Two major factors are behind the crazy surge in Bitcoin!

Since the beginning of this year, the highest intraday price of Bitcoin has reached $5,843.00. After the price of Bitcoin soared to break through the $5,000 mark, some analysts predicted that the price of Bitcoin will exceed $6,000 in the future.

On October 20, the intraday high of Bitcoin against the US dollar reached 5638.90. A large number of encrypted digital currencies, including Ethereum and Litecoin, are imitating the price trend of Bitcoin. Compared with the beginning of this year, the price of Bitcoin has increased by 546%. The prices of Ethereum and Litecoin have soared by 4000% and 1325% respectively.

Since the number of cryptocurrencies in the market is limited, the upward momentum is also limited. At present, there are two main factors affecting the price of cryptocurrencies.

1. Increased investment interest from institutional investors

A recent report from Bank of America noted that the increase in the value of cryptocurrencies is due to increased interest from institutional investors. As financial services companies begin to offer cryptocurrency products to their clients, Bank of America predicts that this could affect “liquidity and market capitalization of cryptocurrencies.”

Currently, it is European institutions that are leading the way in designing new products using cryptocurrencies. The Swiss Financial Supervisory Authority has approved Swiss private bank Falcon Group to provide Bitcoin asset management for clients.

In addition, Goldman Sachs is also considering Bitcoin transactions, and JPMorgan Chase recently launched a payment network based on the Ethereum blockchain.

2. Increased demand for cryptocurrencies in the Asian market

Although South Korea and China are currently tightening their Bitcoin regulations, the investment interest of Asian investors has not been suppressed. According to a report by Bank of America, investors in both countries even invested their excess funds in Bitcoin and cryptocurrencies.

Demand for cryptocurrencies continues to grow in the Asian market. Asian countries have become the largest markets for Ethereum. Earlier this year, Japan recognized the legal trading status of Bitcoin, which is one of the reasons for the rise in the price of cryptocurrencies so far this year.