Bitcoin’s recent rise above the sentimental price marker of $10,000 has not gone unnoticed in the cryptocurrency space, nor in the eyes of potential new investors. Google Trends for the term “Buy Bitcoin” has seen a big spike towards the end of January.
The correlation between Bitcoin’s price and activity in Google searches is not particularly new. In fact, the excitement in searching for terms related to the leading cryptocurrency has even been attributed to its rising in price.
Additionally, a virtuous cycle can form and — looking back at August 2017, just before Bitcoin started its rally towards its all-time high of $20,000 — crypto VC Chris Burniske coined this phenomenon as a ‘virtuous Satoshi cycle.’ This is where an increasing price drives interest in Bitcoin and that interest further drives the price of BTC.
Now, with Bitcoin pushing upwards again, this Satoshi cycle seems to be being realized as commentator @themooncarl has noted that the phrase “buy Bitcoin” has seen a big spike. This, according to the analyst, also indicates that new money should be entering the market — which, in turn, can mean a price increase for BTC and altcoins.
Is the Satoshi Cycle a Good Bitcoin Predictor?
Historically, the virtuous Satoshi cycle, as proposed by Burniske, has proven itself — especially when there are significant price rises that are large enough to spill over into mainstream media and to entice new investors into the market.
Burniske plotted the price rise of Bitcoin, going all the way back to 2010, and transposed it over the Google search trends for the term ”Bitcoin” — and the correlation was noteworthy.
It is also worth noting that, when Bitcoin was not as well known in the mainstream — such as in June 2011, when the price spiked 720 percent in a month — there was not much growth in Google searches. However, when Bitcoin grew 70 percent in a month in 2017, the year it entered mainstream consciousness, Google searches skyrocketed.
What Will Happen in 2020?
The search term “Buy Bitcoin” has seen a massive spike in this recent rally and it is important to separate this term from simply “Bitcoin” — which is up 33 percent in the last week. As noted, the former term could indicate that new investors and new money are entering the space, whereas the latter term could be more indicative of people already invested who are keeping an eye on what is happening in the news.
More so, 2020 is a very different year in terms of investment in Bitcoin as compared to 2017. Interest from individuals in 2017 had a huge effect on the growth of Bitcoin’s price. However, 2020 sees a more mature market that probably needs bigger money to move its needle.