Potential political scandals and increased demand from Japan and South Korea are named as the most possible reasons for current Bitcoin boost.
Bitcoin has exceeded the $1,900 barrier for the first time ever. The cryptocurrency is currently traded at $1,932, according to the CoinMarketCap.
Bitcoin experts explain the growth with the intention of investors to find safe haven trades. Increased interest from Asia also contributed to the boost of the digital currency.
The fall of major stock markets was observed in the last two days as separate reports of potential scandals in the U.S. and Brazilian presidencies bewildered investors.
The S&P 500 underwent its worst day since September due to the growing worries that U.S. President Donald Trump might fail to carry out his promises of tax reform, deregulation and infrastructure spending due to legal issues. A late Tuesday night report alleged Trump asked recently fired FBI Director James Comey to “let go” of an investigation into former national security advisor Michael Flynn.
Wednesday evening brought disturbing news from Brazil as it was reported that back in March President Michel Temer discussed bribing former House Speaker Eduardo Cunha to prevent him from testifying about a massive corruption case. Temer assured that he will not resign and will prove his innocence in the Supreme Court
As a result, the Brazil Bovespa fell more than 8 percent Thursday showing the worst results since October 2008.
Chris Burniske, blockchain products lead at ARK Investment Management, said Brazil has a “decent bitcoin community there already”.
It is doubtful that such volatile asset as bitcoin has managed to earn a reputation of a “safe haven” but some experts believe the digital currency is capable of challenging gold as a go-to safe store of value in turbulent times. Gold futures are up almost 2 percent in the last one week.
Increased demand from Japan and South Korea is named as one more factor driving bitcoin’s price higher. The cryptocurrency price rose slightly from prior days. As for now, Japan’s share reached 40 percent, up from near 36 percent, and South Korea’s share makes up about 5.6 percent from 5 percent.
Both countries are reported to start trading to retail investors in the next few months.
Bitcoin has seen more support recently as the future of blockchain, the technology supporting the digital currency, appears more stable. Bitcoin has a market capitalization of $30.8 billion while the total cap of all cryptocurrencies has reached $66 billion.