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Has the time come to jump onto the Bitcoin bandwagon?

Bitcoin has risen from $3,000 lows in December 2018 to sniffing the $11,000 milestone this weekend, which is more than a 150 percent jump in six months!

Days after Facebook announced its upcoming new cryptocurrency 'Libra', the more popular Bitcoin touched $11,000 highs Data released by Google Trends backs the notion that institutional interest in the popular cryptocurrency is on the rise While the chatter in the crypto industry seems to be "high risk, high reward", it comes with a word of caution

The interest in Bitcoin seems to be on the rise again. Days after Facebook announced its upcoming new cryptocurrency 'Libra', the world's largest cryptocurrency Bitcoin ($BTC) climbed above the $10,000 milestone for the first time in more than a year on the Luxembourg-based Bitstamp exchange. For those keeping a close eye on $BTC, this was not surprising, as it had crossed the $9000 mark a week ago.

What is surprising, however, is that it took all of one day for Bitcoin to move from the $10,000 milestone to sniffing the $11,000 mark. At the time of writing this article, Bitcoin was priced at about $10,750. This indicates that the cryptocurrency rose about 7 percent in a day, before stabilizing on its upward climb. 

Source: Coinmarketcap.com

Is Bitcoin on the cusp of another boom?

One of the prime reasons investors advise caution while considering Bitcoin is because the cryptocurrency is subject to volatility and is therefore riskier than other traditional investments such as mutual funds and stocks. Bitcoin soared during 2017 at $20,000 highs before swooping down to about $3,000 in December 2018. 

2019 has ushered in new era of hope for cryptocurrencies such as Bitcoin, which has steadily climbed more than 150 percent in less than six months to cross the "psychological barrier" of $10,000. Data released by Google Trends backs the notion that interest in the popular cryptocurrency is on the rise. However, most of the interest that has led to the recovery of $BTC through the first half of 2019 has been driven by institutional investors. 

Google Trends data indicates that if retail investors begin showing interest in a "fear of losing out", Bitcoin could rally to new heights. Despite, its incredible rise to the $10,000 mark, the popularity of the keyword is currently 88 percent lower than what it was when Bitcoin peaked in 2017, data from Google Trends confirms. In fact, top analysts including Fundstrat Global Advisors’ research chief Tom Lee told CNBC Futures Now that Bitcoin could "easily" climb to $20,000 again – and possibly even further to a $40,000 mark.

Furthermore, news that the Intercontinental Exchange (ICE), which is the New York Stock Exchange's owner, is soon going to be launching its own cryptocurrency exchange called Bakkt, has spurred positive sentiment toward the cryptocurrency ecosystem. Trusted American financial planning and advisory corporation Fidelity Investments' foray into cryptocurrency through the development of a service to store Bitcoin has also fueled positive sentiment. The U.S. Federal Reserve's complete U-turn from a minimum of two expected interest rate hikes at the start of 2019, to keeping its rates unchanged, and possibly even considering a rate cut in the near future has peaked investor sentiment. 

Global investors are also taking note of other interesting U-turns by respected industry leaders. Mark Mobius, co-founder of Mobius Capital Partners, and James Dimon, CEO of JPMorgan Chase, who were both skeptical of Bitcoin, have now changed their mind on the subject. JPMorgan Chase is now developing its own blockchain-based cryptocurrency called JPMCoin, making it the first major U.S. bank to launch its own cryptocurrency. 

While the chatter in the crypto industry seems to be "high risk, high reward", it comes with a word of caution. The industry is still working to overcome serious security concerns such as hacks and fraud. The perpetrators of the January 2018 Coincheck theft worth $530 million were revealed recently. SANS, one of the most trusted and largest provider of cyber security training and certification to professionals at governments and commercial institutions world-wide, disclosed recently that cyber security risk is at critical levels. 

In such a climate, will investors continue to be drawn to Bitcoin and cryptocurrency investments? Time will tell.