Bitcoin, the pioneer of cryptocurrencies, has captivated enthusiasts with its extraordinary trajectory that mirrors a rollercoaster ride through financial markets. In 2024, it stands on the cusp of surpassing its own record high, showcasing resilience and volatility in equal measure.
From its remarkable run-up to an all-time peak of US$68,649.05 in November 2021, Bitcoin underwent a staggering 1,200 percent surge between March 2020 and November 2021 before encountering turbulence in 2022.
Starting the year 2024 modestly above US$44,000, Bitcoin has swiftly climbed to reach a trading price of US$61,113 as of February 29, 2024.
Welcome to the gripping saga of Bitcoin’s price evolution. What forces have propelled Bitcoin’s recent resurgence, and what lies ahead? Let’s delve into the intricacies.
The Genesis: Unraveling the Enigma of Bitcoin
Bitcoin emerged in response to the 2008 financial crisis, unveiling a saga of extreme price fluctuations. After soaring to US$19,650 in 2017, Bitcoin endured years stagnating below US$10,000. Introduced in late 2008 via the cryptic white paper named “Bitcoin: A Peer-to-Peer Electronic Cash System,” the brainchild of the elusive Satoshi Nakamoto ignited a revolution in monetary systems.
Featuring cryptographic security, the decentralized system aimed to resist censorship, leveraging blockchain technology to forge an immutable ledger banishing double-spending woes. Bitcoin’s allure lay in emancipating power from traditional banking institutions, resonating particularly during the aftermath of the 2008 global financial meltdown.
Tracing the Bitcoin Ecosystem: Limited Supply, Maximum Impact
In stark contrast to conventional fiat currencies susceptible to inflationary pressures via endless printing, Bitcoin operates on a stringent supply cap. With a total limit of 21 million coins, nearly 19.1 million are already in circulation, leaving a meager 2 million awaiting mining.
The core fabric of Bitcoin’s algorithm enforces scarcity to thwart inflation. Miners craft new Bitcoins by verifying transaction blocks using specialized software. Approximately 900 fresh Bitcoins enter circulation daily, halved automatically after every 210,000 blocks. The upcoming halving, anticipated in April 2024, promises further intrigue in Bitcoin’s supply dynamics.
Unmasked: Bitcoin’s Dance with COVID-19 Turmoil
Bitcoin’s upward trajectory commenced in 2016, initiating a notable climb from US$433 to US$959 by year-end, reflecting a robust 121 percent uptick in value. The watershed year of 2017 heralded Bitcoin’s mainstream embrace, propelling its value to an astronomical 1,729 percent surge — soaring from US$1,035.24 in January to US$18,940.57 in December.
While grappling with its own volatility, Bitcoin maintained a floor above US$3,190, resisting a revisit to the nadir post-2017. Despite naysayers leveraging its short timeline to sow doubt, Bitcoin weathered the storm during the COVID-19 turmoil. The digital coin peaked at US$29,402.64 by the end of 2020, signifying a monumental 323 percent annual gain, eclipsing even gold’s exceptional rise during the same period.
The Zenith: Bitcoin’s Record High and Beyond
Bitcoin’s ascent culminated in a groundbreaking all-time high of US$68,649.05 in November 2021, rocketing by 98.82 percent from January. Despite a partial pullback to US$47,897.16 at year-end, the cryptocurrency notched an impressive 62 percent annual surge.
Multiple factors fueled this historic milestone, including heightened investor risk appetite and Tesla’s monumental Bitcoin investment. Tesla’s subsequent plan to accept Bitcoin as payment for electric vehicles further stoked market fervor. The year was a testament to Bitcoin’s enduring allure and adaptability amidst evolving trends.