Bitcoin rise

This post will try to list all possible reasons why Bitcoin price rise. you can also read about reasons why bitcoin price rise HERE.

Some concepts presented in this post make no sens for ordinary people, but they are extremely important in some finance or corporate communities. Please read with caution or moderation!!

So why Bitcoin constantly or suddenly rise?

1- Blockchain

halving

supply reduction every 4 years lead to price surge, the next halving is expected in 2028

2- Corporate

Payments

Many are already accepting Bitcoin as payment, each week or month additional small and large companies are announcing that they started accepting Bitcoin as payments, it's an implicit acceptance of the crypto as a treasury asset at least for a one day.

Treasury

companies allocating bitcoin as a treasury asset

i recently published a post about the reasons pushing companies to consider BTC as a treasury asset.

Shareholders votes

announcements of shareholders vote on BTC adoption are periodically announced on the media, they are significant if we consider the size of treasuries in companies like microsoft or amazon.

Yield strategy

Microstrategy is bitcoin large holder and a public company that communicate constantly about plans to purchase bitcoin, you can expect a price rise each time such announcements are made.

3- Economic

Big economies economic policy announcement

Government are responsible for the economic situation in their respective countries, they can increase spending on infrastructure projects and they also have access to tools like fiscal policy. if a government expect a recession in the coming year, they can for example lower or ease taxes to maintain medium companies afloat or stimulate consumers spending.

the cash injection resulting from such policies can for example increase saving, feed demand for bitcoin and the rise of bitcoin price.

Inflation

Data

There is a plethora of indexes published periodically by different institutions like the Bureau of Labor Statistics for example.

1. US inflation data
2. US CPI data / consumer price index
3. PPI- Producer price index
4. Unemployment - initial jobless claims
5. real estate

at a professional level, Monitoring those indexes in major economies like the US, EU, china, Japan,...are routine task for traders

Central bank rate decision

Central banks are responsible for the control of inflation, they have access to a tool like the interest rate. To SIMPLIFY what central banks do i would say:

1. if inflation rise, they rise the interest rate.
2. if inflation go down, they lower the interest rate.

an investor having the choice between Bitcoin and treasury bonds will basically choose to invest in bitcoin if interest rate are low.

4- Government

National, state or local Governments can propose, vote new laws that are in favor of crypto regulation, if they have the support of the majority of the population or the majority of the members of the parliament

Payments

if a government allow Bitcoin as a legal currency, there will be potentially more demand that will lead to the rise of BTC price

Reserves

Gov reserve asset

Plans for bitcoin partially replacing gold can push BTC price up, you can find HERE what some government are doing or planing to do in the future

5- Institutions

institutions are organization managing risks and funds at a professional level, they are large investors that can accumulate large amounts of bitcoin, by doing so they reduce supply in the market which push prices up

ETF

inflows into BTC ETFs are daily metric that are key to understanding daily price changes.

Sovereign wealth funds

Endowments

Pension funds

6- Media

Many analyst, advisors and asset managers accumulated significant credibility over the years because of their results or position in the past. Portfolio recomendation by the financial world public figures can encourage retail investors to buy Bitcoin, this will increase demand and push prices up.

7- Technology

The day to day change in price and speculation depend on the unstoppable influx of news and data. this may disconnect you from the fundamentals that are not financial but reliant on technology development and engineering.

a lot of plans and hopes are placed on the future development of blockchain technology and DeFi, with some significant change in infrastructure, transaction and regulation.

Those change will imply an increase in use of bitcoin as payment for example which can lead the rise of BTC price.

Status: Soon to be updated.

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