Bitcoin Surge in 2023: Outperforming Tech Companies and Hitting Record Highs in Inflation-Hit Countries
Summary:
Bitcoin has shown a significant rebound in 2023, showcasing a growth of more than 153% year-to-year and 143% over the past 12 months, outperforming many tech companies. Despite this, the cryptocurrency still trades 39% below its all-time high from November 2021. On a global scale, Bitcoin is hitting record highs in countries like Argentina, Turkey, Egypt, Nigeria, Lebanon, and Pakistan, predominantly due to high inflation rates. The IMF data shows the highest annual inflation rates are in Zimbabwe (396%), Venezuela (250%), Sudan (238%), and Argentina (135%). Bitcoin has emerged as a secure store of value for many investors in these countries, providing a hedge against increasing inflation.
In a strong rebound from a low point of about $16,800, Bitcoin (BTC) has shown its formidable stamina throughout 2023. The popular digital currency has grown by over 153% over the course of the year, and 143% in the past 12 months, outshining the performance of many major tech firms. Still, Bitcoin's price currently sits 39% below its record-breaking high reached back in November 2021. Notably, it's hitting new high marks in places like Argentina, Egypt, Nigeria, Lebanon, and Pakistan, where a total of 725 million people are witnessing the usefulness of Bitcoin firsthand.
A post from Dec. 13 reveals that on Dec. 12, a single Bitcoin reached record highs against several currencies. These included 15,176,100.12 Argentine pesos (ARS), 1,202,109.40 Turkish liras (TRY), 32,703,517.06 Nigerian nairas (NGN), and 1,280,955.47 Egyptian pounds (EGP). The value reached peak levels as well against the Lebanese pound and Pakistani Rupee. It's crucial to note these figures correspond to the current Bitcoin price.
Bitcoin's sky-high growth in these nations is a result of punishing inflation, which has decreased the value of their national currencies. Information from the International Monetary Fund (IMF) identifies countries witnessing significant annual inflation rate changes. Zimbabwe ranks the highest, with an annual inflation rate of 396%, followed by the Venezuelan bolivar (250%), Sudanese pound (238%) and the Argentine peso (135%). Turkish lira and Nigerian naira also have annual inflation rates of 64% and 30%, respectively, per the IMF's data.
For most crypto investors in these nations, Bitcoin has proven to be a reliable store of value and a safeguard against soaring inflation. Despite their currencies consistently losing value, nations like Nigeria and Argentina are increasingly embracing cryptocurrencies. Nigeria, Turkey, and Argentina sit at second, twelfth, and fifteenth places when it comes to global cryptocurrency adoption rates, according to a report by Chainalysis from Sept. 12.
Argentina's pro-Bitcoin president, Javier Milei, who won the Nov. 19 run-off, is likely to boost Bitcoin adoption even further. Shortly after taking office on Dec. 10, Milei's Economy Minister Luis Caputo announced a devaluation of the peso over 50% to 800 per dollar as part of an "emergency package" to balance the country's budget by 2024. The package gained the IMF's approval, who praised the measures as "bold."
During a lengthy bear market in 2022, Bitcoin followed the downward trend of tech stocks, but it has since rebounded, outshining all except Meta, which saw a 172% YTD gain versus Bitcoin's own remarkable 162%.
Pantera Capital, an American cryptocurrency hedge fund, credits Bitcoin's 2023 recovery to an array of positive events leading to considerable progress in the blockchain industry. It mentions examples including widespread institutional adoption due to Bitcoin ETFs backed by major traditional finance players like BlackRock and Fidelity, and Bitwise, a blockchain ETFs leader.
The firm also noted that the U.S. court system's perceived fairness has been reassuring, pointing out instances like the judgement declaring XRP is not a security and Grayscale's successful lawsuit against SEC regarding their BTC application. These rulings suggest a promising regulatory environment for cryptocurrency in the U.S., fostering further innovation. Bitcoin's upcoming halving event in 2024 also feeds into the broad enthusiasm for the leading cryptocurrency. This article doesn't provide investment advice or suggestions. Each investment or trading move comes with its own risks, and readers should do their own research before deciding.
Published At
12/14/2023 12:44:05 AM
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