I am not sure why there is such a discrepancy between the interest in Bitcoin (as measured by google searches in the U.S.) and the price.
Until recently, there was a reasonably high degree of correlation between Bitcoin prices and interest in bitcoin.
Could it be that
- Everyone who wants to know about Bitcoin now knows about it?
- The daily price swings are too wild for many ‘investors’ to care?
- Has Bitcoin become dominated by players outside the U.S.?
- that would coincide with the fact that the recent dramatic increase in prices started around the time tensions between the U.S. and China also increased.
- Could it be that institutions are buying bitcoin and it takes fewer large investors to influence the price?
I don’t know the answer, but it feels that we are at an inflection point again with Bitcoin. If we retreat from these high prices, the naysayers will be able to argue that once again, bitcoin has proven too volatile and susceptible to short-term prices that don’t reflect long-term value.
If we stay at these levels, or get further increases, it seems difficult to believe that more investors won’t start dabbling.
At the very least, it is interesting to think about why this dichotomy exists, and I suspect that figuring out why it exists and how it will resolve itself will be worth a lot of money – either to the bulls or bears.