BITCOIN saw a sudden spike, to drive prices up by more than $1,000 in just under an hour as the cryptocurrency market surges into the green today. What is happening with BTC?
Cryptocurrency prices this morning are all in the green as an inexplicable price surge boosted the values overnight.
In just one hour, bitcoin prices rose by more than $1,000, pushing it over the $8,000 barrier for the first time in a fortnight.
A 13% percent increase this morning sees BTC trading at $7,811.52 as of 8:42am on April 13.
The world’s most successful cryptocurrency appears to be back on a bull run that investors hope will last for the rest of 2018.
What is happening with bitcoin?
Last night saw the biggest hour of trading in bitcoin’s entire history, with more than $270 million changing hands in 55 minutes.
More than 38,500 coins were traded last night to help boost the price up by more than $1,000.
There doesn’t appear to be any single explanation for the sudden spike in price, however, as cryptocurrencies are extremely volatile and subject to vast price swings at the drop of a hat.
“In this scenario traders with short positions will start to lose money and liquidate their positions by buying bitcoin,” Ed Cooper, head of mobile at fintech start up Revolut explains.
“This causes the price to rise further and as more people start to notice the rise they buy in for a quick gain. This continues the cycle.”
2018 has not been easy for bitcoin or the crypto-market in general, with more than half of its market cap being wiped off in the first quarter.
Traders were expecting a positive mid-April, with the US tax deadline forcing traders to make cash to pay capital gains tax.
The deadline is not for a few days so it is still unusual for such a spike to hit the market.
Bitcoin prices have encountered several headwinds lately, including regulation speculation and the decision of the Mt. Gox trustee to sell hundreds of millions of dollars’ worth of digital currency, noted David Johnson, CEO of Latium.
However, these bearish factors have weakened as of late, he stated.
This development has helped the digital currency rally.
— Armin van Bitcoin ⚡ (@ArminVanBitcoin) April 12, 2018
“I believe the surge in bitcoin price is connected more with decreased selling pressure than anything else,” said Johnson.
Most other major cryptocurrencies saw major price spikes as well.
Ethereum and Ripple have both seen prices improve by more than 13% percent in a matter of hours and prices are looking to continue.
The bull-run could last for the rest of mid-April as traders pick up a momentum.
Despite the gains, Cooper advised investors to be cautious about betting on a positive direction of the market beyond the short term.
“We’d need to see a sustained rise over a number of weeks to signal the end of the bear market,” Cooper said. “We’re definitely not there yet, but it’s a good start!”
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