After weeks in the doldrums, Bitcoin price jumps $50 in a matter of hours

Home » After weeks in the doldrums, Bitcoin price jumps $50 in a matter of hours
Image credit: https://www.flickr.com/photos/zcopley/

Image credit: https://www.flickr.com/photos/zcopley/

After months of steeply declining prices in the wake of the Mt.Gox implosion and an increasingly restrictive environment in China, bitcoin prices have spent most of the last month hovering around $450. For many, this relative stability has been seen as a positive development, providing a window for new services to make plausible claims that bitcoin’s inherent volatility was finally quieting down. And then, for reasons that are still unclear, the price shot up from $444 to $493 in a matter of hours.

Clearly, there’s still a little volatility left in the “honey badger of currency.”

What’s causing the price spike? Does it indicate the end of the overall price-decline trend? Or is this just a fluke caused by a short-term lack of supply? There are no obvious answers, but there are some plausible theories floating around at the moment. The “real” cause may well be a combination of these factors, or something completely undiscovered.

1. Bitcoin2014 made some converts. With the heavy hitters in the bitcoin industry all in one place at one time, and many of those people pitching new and exciting bitcoin businesses, cryptocurrency fever is spreading. Even a relatively small corporate investment in the tens of millions could move the price. In fact, today’s buying spree seems to have started with a 700 BTC ($315,000) sell order that was instantly snapped up.

2. BTCXIndia is finally gaining ground. India’s first legally compliant bitcoin exchange officially launched earlier this month, opening the country’s massive and severely “underbanked” population to bitcoin. India has been seen by hopeful members of the bitcoin community as the “next China” in terms of the potential impact on price, and today’s rise may well be one indication this this is true. India’s national currency, the rupee, has been increasingly unstable in recent months, making bitcoin seem like a relatively appealing hedge.

3. False price stability is ending. One fringe theory that has popped up from time to time is that investment funds like SecondMarket and venture-capital backed bitcoin payment processors like Coinbase, BitPay and Circle have been quietly moving to keep the price stable. With volatility a major concern for investors, a relatively stable period that just happens to coincide with Q2 deal making does seem a little too convenient for some. Now that those companies have made their pitches and kept prices artificially stable and low, the thinking goes, the price will only naturally rebound with a new hard bottom of around $450.

4. The end of the Falling Wedge. While it doesn’t explain why the price may be recovering, many point to a chart analysis technique called the “falling wedge” to indicate the reversal of a downward pricing trend. The basic idea is that as a price falls, it tends to bounce within a given range, creating a triangle shaped wedge when drawn on a chart. At the end of the wedge, trading volume steeply declines, exactly what has been happening to bitcoin in recent months. If accurate, the end of this falling wedge would hint that a major upward trend is approaching.

5. Federal Reserve advisors call bitcoin a “boon” and other positive news. There has been a fair amount of positive news coming from regulators of recent, from the Fed’s Federal Advisory Council (FAC) claiming that bitcoin could be a powerful positive force in global commerce to the Conference of State Bank Supervisors (CSBS) holding a seemingly receptive meeting with bitcoin company representatives. Increased confidence might create a rising price.

None of these theories are home runs, and the rise in prices could be explained by many other theories. Given that bitcoin is global, has been on the receiving end of an unprecedented amount of publicity of late, and that hundreds of millions of dollars in venture capital money is moving into the ecosystem, even a tiny change could result in a significant price gain. In any case, it’s nice to be out of the doldrums for a bit.

New Casinos

Get 180 free spins and up to 5 BTC in bonuses

CasinoMax: 325% match bonus up to $9750 + 25 bonus spins for 7 consecutive days

400% welcome bonus up to $8000. 40x wagering requirement is required prior to your first withdrawl

Great Welcome Slot Bonus!

Claim a HUGE 500% deposit bonus with no maximum with Crypto

use code WELCOME 200 and get up to $10,000 + 100 Free Spins!

© Copyright 2024 The Best Crypto and Bitcoin Casinos and Sports Betting Sites | Bitcoinx
Powered by WordPress | Mercury Theme