The Spanish "Le Monde" website published a report on December 18 reporting bitcoin will not collapse for now, The full text is excerpted as follows:
In 2020, people's understanding of Bitcoin has undergone major changes. US PayPal users can already use their accounts to buy, sell and keep bitcoin. The Spanish Foreign Bank recently announced the launch of a test, which will be the first trading service provided by the bank for the sale and custody of digital assets. This new service allows users of the bank to use Bitcoin for transactions or use it for savings.
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JPMorgan Chase Bank, which once called Bitcoin a "scam" in 2017, now also believes that Bitcoin will eventually replace gold as a safe-haven asset.
To sort out the source of the change in concept, one must look at Wall Street. The Wall Street financial community has begun to treat Bitcoin as an investment asset, and its status can be comparable to traditional investment assets. This concept is in contrast to 2017. At that time, the price of Bitcoin rose to US$20,000, but fell to a trough in 2018, dropping to US$3,500.
Could the Bitcoin price collapse happen again? As far as investment is concerned, it is difficult to make predictions, everything is possible. However, analysts generally believe that it is precisely the change in people's perceptions and the participation of institutional investors that provide some protection for Bitcoin. Specifically, even if Bitcoin collapses, it will not be as violent as it was three years ago.
The participation of institutional investors has become a "soft cushion" that can ease the frequent ups and downs of bitcoin prices, allowing bitcoin to stabilize at a level that was unimaginable a year ago. A recent survey conducted by Bank of America confirmed the growing interest of such investors in Bitcoin. The survey shows that Bitcoin is the third most popular asset in the hands of traditional asset managers. "The biggest driver of Bitcoin's current price increase is institutional funds," said Alejandro Sala, the manager of the digital asset company Bitpanda Spain. The change in investor thinking cannot be ignored because "the new generation (investors) will Bitcoin is regarded as gold".
Intergenerational issues are only one of them. The impact of the new crown pneumonia epidemic on the economy and the stock market is another major reason for Bitcoin's renewed success. The expansionary monetary policies implemented by major central banks and high fiscal deficits have prompted managers to find alternatives that can provide higher returns.
Bitcoin is one of the alternatives. Bitcoin has a limited supply and is an excellent choice for value storage. In addition, Bitcoin has a clear distinction from traditional assets. Javier Molina, spokesperson for the Spanish trading platform of eToro, said: "In this way, the risk of Bitcoin's return seems to be within the range that investors can bear."
