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Bitcoin is On the Verge of Reaching $50,000

Bitcoin is On the Verge of Reaching $50,000

The word "fear" is rapidly being replaced by "hope," but will Bitcoin's price action be able to successfully breakthrough and hold $50,000?

Bitcoin (BTC) drew closer to $50,000 on December 22 as signs emerged that the recent price correction might be coming to an end.

Get excited when the $50,500 barrier is broken — Analyst

BTC/USD reached highs of $49,600 on Bitstamp, according to data from Cointelegraph Markets Pro and TradingView — the highest level since December 13.

While the turmoil in the Turkish lira on Monday has subsided in spirit, Bitcoin and altcoins have continued to rise, with investors' attention now focused on the new year and price levels above $50,000.

"The first significant breakthrough has occurred with Bitcoin. "However, we still need to break through a sufficient number of levels before we can declare ourselves bullish," Cointelegraph contributor Michael van de Poppe stated overnight.

Because $50,000 represented psychological resistance, others looked to on-chain metrics for additional evidence of the underlying strength of the Bitcoin currency network.

There were a number of them, including fund manager Dan Tapiero, who noticed bullish signals on the moving average convergence divergence (MACD) indicator at a time when historically it was a good time to buy.

As he put it, "Rallies begin when it is least expected/when tired bulls give up."

The MACD indicator on Bitcoin/USD measures the relationship between two exponential moving averages, and a rebound from a downtrend has historically preceded price run-ups.

The last time the buy signal appeared was at the end of September, just as Bitcoin was about to reach new all-time highs a little more than a month later.

The index of consumer sentiment nearly doubles.

With more significant daily gains beginning on Wednesday, altcoins have begun to provide more encouraging signals for investors.

Ether (ETH), the most valuable altcoin in terms of market capitalization, has maintained its value of $4,000, while Terra (LUNA), a standout cryptocurrency, has gained 16 percent at the time of writing.

Ripple's XRP token rose by 9 percent on the day, with none of the top ten cryptocurrencies by market capitalization trading in the negative.

In addition, van de Poppe stated that if he wanted to be in a good position, he would invest in cryptocurrency at this time.

Overnight, the Crypto Fear & Greed Index experienced a significant increase, rising from 27 to 45, but the index continues to characterize the market as being in "fear" mode.

Bitcoin reached unexpectable heights in 2021, but it also experienced some extremely low points at the same time. Here's a detailed look at how the flagship cryptocurrency fared throughout the year.

While the year 2021 did provide some measure of respite for investors operating across the global crypto landscape, it was still largely driven by fears that first surfaced in the year 2020 and continued into the following year. While everyone's attention was focused on other things, the ground beneath their feet continued to shift, whether it was due to rising inflation rates or another wave of coronavirus-related outbreaks.

For example, while everyone — including many traditional financial institutions — predicted that Bitcoin (BTC) would easily reach a price target of $100,000 by the beginning of the new year, despite having reached an all-time high of $69,000 earlier in November and having essentially moved in a broad sideways channel for the previous ten months, the flagship cryptocurrency has maintained a high level of volatility.

Having said that, there have been numerous developments involving Bitcoin this year, the majority of which have been positive, but there have also been some negative developments as well. Many of these themes, as well as many others, will be explored in greater depth in this piece. So, without further ado, let's get right down to business.

BTC News: As El Salvador takes the lead in adoption, the movement gains momentum.

The Central American nation of El Salvador, known as the "Land of Volcanoes," surprised everyone in 2021 by becoming the first country to recognize Bitcoin as legal tender, potentially paving the way for other countries to follow suit, particularly those dealing with issues related to rampant inflation, such as Turkey, Venezuela, and Zimbabwe, to name a few.

And, despite the fact that the move hasn't completely converted El Salvadorans into BTC supporters overnight, President Nayib Bukele has taken a very strategic approach to resolving the country's economic woes in recent years. Citizens were given access to a Chivo cryptocurrency wallet, and he has promised to address the country's internet connectivity issues, which are currently a source of contention.

Finally, El Salvador's highly publicized "Bitcoin Bond" — which makes use of a federated BTC sidechain to issue a legally viable monetary bond — is being hailed as a promising money-making opportunity because it provides users with a novel means of investing in the currency while also offering them the opportunity to become citizens of the country.

Bitcoin transactions are gaining popularity.

After years of development, the Lightning Network (LN) experienced tremendous growth in 2021, with an increasing amount of funds being poured into various LN channels — particularly as more nodes came online, seemingly with each passing day.

More than 3,300 BTC has been locked across various public Lightning channels at the time of writing, with additional funds likely located within other private/unannounced channel networks that are currently being operated between various exchanges.

The Lightning Network infrastructure has undergone a number of major overhauls in the last year (such as Amboss), which have improved the system's native node administrative capacity as well as the retail customer UX for Lightning wallets (among other things). Thus, the BOLT-12 module developed by LN is expected to simplify the process of making recurring payments and, in the future, will also enable other useful features such as donations through static QR codes.