The price of bitcoin has taken a huge beating in the market, dropping from almost $20,000 in December 2017 to less than $6,000 in the early days of February 2018. So far in 2018, the bitcoin price has yet to show any signs of improvements as price climbs haven’t lasted more than a couple of days. As at the time of writing this article, the price of bitcoin has dropped over the last 24 hours to below $7,000. A number of experts and analysts have sounded the death knell for bitcoin declaring that the good days are over. However, one individual, the founder of crypto payments startup, believes otherwise.
The Influx of Hedge Fund Money
Bill Barhydt is the CEO of Abra, a crypto payments startup company that was established in 2014. According to an article published on Business Insider, Barhydt expressed optimism that the price of bitcoin will explode again in the year 2018 despite the current price slump. Barhydt’s confidence isn’t just a matter of blind optimism as he gave a supporting argument for his assertion that bitcoin is set to experience another boom.
There isn’t a great deal of investment in the bitcoin by institutional investors in Europe and America. Meanwhile, in Japan, the situation is the exact opposite. Barhydt believes that institutional investors in Europe and America will soon take a leaf from their Japanese counterparts and begin to invest heavily in the market.
Issues pertaining to crypto regulations have been identified as a major reason for the downward trend in not only the bitcoin market but the crypto market in general. Barhydt is of the opinion that the market and the regulatory authorities are getting closer to real clarity in terms of the regulatory framework for the crypto market. Once this happens, according to Barhydt, more institutional investors will begin to bet heavily on the market by putting a considerable percentage of their funds into the market.
Imminent Bitcoin Boom Regardless of Google Trends
There is a known correlation between the level of public interest in bitcoin and the value of bitcoin. This level of public interest in bitcoin is determined via data obtained from Google Trends based on a number of metrics. Barhydt believes that the bitcoin boom will occur irrespective of the prevailing Google Trends. The Abra CEO maintains that the entry of big investors into the market will not necessarily have an effect on the Google Trend metrics. Changes to the metrics will only become apparent when the price of bitcoin begins to surge.
A Catalyst for the Boom
Using the 2017 surge as a case study, Barhydt pointed out the extent of the effect that institutional investors have on the price of bitcoin. He declared that Japanese institutional investors were a major player in the sudden jump in bitcoin price from $7,500 to almost $20,000 in only a matter of a few short weeks. If a handful of Japanese investors contribute to causing such a spike, Barhydt believes the far greater number of Western investors would be able to cause an even greater price spark.