Bitcoin

After ‘Bitcoin’ Google Search Spike, More People are Interested in Buying Bitcoin

Bitcoin searches tripled after it surged past the $5,000 mark, at midnight of second April, 2018. This is evident from the Google Trends showing the number of searches for the word ‘bitcoin’ hitting the highest since November 2018. The following graph from Google Trends clearly puts the search spike in the context of its previous trend.

Image Source: Coindesk

April 2 was the day when bitcoin surged from its standstill of months and became the talk of the entire crypto world. This shows a clear-cut relation of bitcoin’s price with the interest that people have in the asset. The search spike for keyword ‘bitcoin’ was also seen back in December of 2017 when the asset was almost touching the $20,000 mark. Although the recent spike is much less than the spike seen in December of 2017, it is still the highest in the last five months signifying that the interest in bitcoin is now being developed again as its price shoots up.

This correlation between search rise and bitcoin’s price spike is a clear indication that people are more interested in the aspect of gaining profit from bitcoin’s price than using it as a source of making payments while treating it as an actual currency. If bitcoin is to gain more acceptance worldwide, the focus needs to shift from price volatility to its usage in real-world activities. But if there is a link between bitcoin’s price and public interest, what controls the price of this digital asset?

READ ALSO: Bitcoin Volatility Drops, What Does it Mean for the Asset? Explains Founder Morgan Creek Digital

Bitcoin’s price fluctuations are far more often than any other asset or commodity. Speculation is thought to be the most important factor that dictates its price. People are buying into the idea of value carried by bitcoin solely on speculation and there is no physical backing of this internet money. Besides speculation, there is another factor that highly dictates its price direction: futures trading.

Bitcoin has a significant futures market and is listed on two of the biggest options and futures market of the United States, CME Group and CBOE. Futures are essentially contracts of buying or selling a particular asset or commodity at a specified time in future on a mutually agreed upon price. As suggested in a recent report by Bitwise, share of the bitcoin’s futures trading market is much more significant in the overall trading volume than previously thought. Higher activity in the futures market can lead the asset to push its price further up. On April 4, CME Group, which lists bitcoin futures on its exchange, tweeted:


On April 4, bitcoin rallied up in terms of its price and coincidentally, the activity of bitcoin futures on CME Group’s exchange also hit its highest. This is just another affirmation of the report put forward by Bitwise that the futures trading market has a lot to do in terms of bitcoin’s price fluctuations.

READ ALSO: Bitcoin Futures Market is Much More Significant Than Initially Thought

Bitcoin emerged as the replacement to the modern banking system after the economic crisis of 2008. It came forward as a decentralized digital currency free from the control of a single party, unlike central or state banks. It is not under the authority of any government across the globe and is a peer-to-peer currency designed to give everyone the power to join the network and maintain it.

Although the initial use-case of this currency was led by illegal usage, over the years, with more interest developed from the institutional side, the digital asset has been moving towards a more positive direction with developments being made both in the area of technology and regulation. The only issue that is hurting this asset is price volatility and price manipulation by big whales. As the market capitalization of bitcoin is small, buying and selling of the asset by big whales in the market makes its price prone to manipulation. Since public interest is directly linked to its price, one thing is clear — the biggest issue that bitcoin needs to solve for its adoption is its price volatility.

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Ahsan Khalid

Blockchain Developer. An Electrical Engineer with majors in software development. I present forward my insight regarding the latest happenings of the blockchain world. All views on my articles are my own. Email: ahsan@blockpublisher.com or editor.news@blockpublisher.com

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