Bitcoin rally short-lived? Google search trends show a bearish outlook
For many Bitcoin enthusiasts, the flagship of the cryptocurrency has arrived on Wall Street with sovereignty.
It now costs around $ 14,500 to buy a bitcoin – about twice as much as it did at the beginning of the year. This is also the highest level since January 2018, when the cryptocurrency was revised down from its record high of almost $ 20,000 in the previous month.
Many analysts agree that Bitcoin’s renewed price rally has to do with growing investor demand for safe investments. Some, including Bloomberg, even believe the cryptocurrency will soar back to $ 20,000 by the end of this year – due to skyrocketing federal deficits caused by trillions of dollars in government spending and inflation fears.
The Bitcoin Era cheerleaders have long projected the coin as the ultimate hedging tool against fiat money, as it has a definite supply cap of 21 million tokens. Since individual mainstream companies have decided to replace part of their cash reserves with Bitcoin, the thesis gained enormous traction through social media.
Unfortunately, the same enthusiasm cannot be felt on Google Trends.
Lack of interest in searches
The latest data from the world’s largest online search engine shows a lack of interest in Bitcoin among everyday internet users. On a scale from zero to 100 over a five-year period, Bitcoin scores 9 points. If the period is changed to 12 months, the value increases to 63.
In contrast, Bitcoin’s trending value was 100 in December 2017, when the cryptocurrency was headed for $ 20,000. Most of the sentiment mentioned had to do with BTC being the first coin to boom.
Startups raised resources in BTC by posing as the next blockchain unicorns and getting ordinary citizens to look for how to buy Bitcoin.
The search for the keyword „Bitcoin“ remains low despite the enormous interest at the macro level. Source: Google Trends
The boom ended in a major collapse as most of these projects failed or turned out to be fraudulent. Bitcoin fell 84 percent from its $ 20,000 high as a result.
The same thing happened with his Google Trend Score, which crashed from “100” in December 2017 to “5” in November 2018.
In contrast, Bitcoin’s main hedging rival, gold, saw a steady trend. Its values fluctuated between „82“ and „51“ – mostly over a period of five years. For the past 12 months they have remained stable above ’71‘.
Interestingly, in the week of May 10-16, 2020, Bitcoin hit a perfect „100“ within a 12 month timeframe. This step coincided with the third “halving” of the cryptocurrency – an event that periodically reduces its daily supply by half, exacerbating its scarcity against fiat currencies.
Good news for Bitcoin, after all
Hans Hauge, head of quantitative strategy at Ikigai Asset Management, thinks the absent “Bitcoin” interest against the rising price is good news. He comments that the lower values for the Bitcoin keyword show that the cryptocurrency has matured.
„This is not the height of a bubble mania, it’s orderly and calm,“ said Hauge, comparing the 2017 trend with the current one. And:
„The next spike in Google Trends will make the last one look like nothing.“