Recovering lost ground! Bitcoin price breaks through 4,200 yuan

As bitcoin prices continue to surge and break through the 4,000 yuan mark, market observers have begun to assert that the digital currency's strength could attract the interest of new global traders.

With many market participants unable to generate returns from more traditional asset classes, investors are considering assets they have never previously explored, such as digital currencies.

(Data source: coinbase)

According to Tim Enneking, chairman of cryptocurrency investment fund EAM, the recent rebound in digital currency prices can be attributed in part to investors’ thirst for new investment products.

Enneking told reporters:

“People are not getting great returns right now in any standard asset class, and they are looking further afield to find them.”

Elsewhere, Joe Lee, founder of derivatives trading platform Magnr, pointed to macroeconomic uncertainty as having led investors to explore new options outside of traditional currency and bond markets.

Against this backdrop, the price of Bitcoin rebounded sharply this week, rising from $538.14 at the opening on June 3 to a peak of $642.271 on June 12 (data from OKCoin).

The price fluctuations came at a time when the market was highly bullish. According to data from Whaleclub, on June 3 and June 4, the market's bullish sentiment reached 88% and 87% respectively, but fell back to 69% and 61% in the past two days.

Bitcoin price recovers lost ground

The Bitcoin market has provided traders with plenty of volatility in recent weeks.

In July 2014, the price of Bitcoin reached $643, and then fell all the way to $200 on January 15, 2015.
At 2:15 UTC on June 5, 2016, the price of Bitcoin rose to $582.83. During this week, the price of Bitcoin experienced further increases and has now broken through the $600 mark.

According to data from Bitcoinity, a total of 9.42 million BTC were traded in the market this week, of which OKCoin traded 5.13 million BTC, accounting for 54.47% of the total trading volume, and Huobi traded 3.23 million BTC, accounting for 34.30% of the total trading volume.

Lee told CoinDesk that investors are also becoming more open to non-traditional assets, and digital currencies are increasingly being viewed as a “robust investment class.”

This shift represents some seismic changes.

Bitcoin is approaching “wider adoption” while some of its opponents have been forced into hiding, Lee said.