Bitcoin has hit its highest level since October as the cryptocurrency gains support at a time global markets are skittish over the effect that Wuhan coronavirus may have on global trade.
Heading towards $10,000, a level that was last seen in late September, bitcoin hit a high of $9552,53 as of 8 p.m. EST before declining to $9,405.02 as of 11:10 p.m EST.
The price increase naturally has investors excited with CCN writing that “it appears that conditions are right for this metric to breakout and possibly foreshadow the next bull run.” The price, if maintained, also sees bitcoin having one of its best months in history. Bitcoin was up 21% from the beginning of the month as of Jan. 15 when it was trading around the $8,500 mark and is now up approximately 30%.
How far bitcoin will grow is, as always, open to speculation. Bitcoin does not always react in line with equities markets but is at time seen as a safe-harbor investment when equities markets are facing issues. Thomas Lee, co-founder of market research firm Fundstrat Global Advisors LLC wrote on Twitter that demand for a “safe haven” is boosting bitcoin.
– Gold is up a decent 3% vs a whopping 26% for Bitcoin pic.twitter.com/GWKEfYGcut
— Thomas Lee (@fundstrat) January 28, 2020
Others disagree with Peter Schiff, chief executive officer of Euro Pacific Capital writing that those buying bitcoin are merely speculating that others will buy it as a safe haven.
For now Bitcoin may be the best performing asset this year, but it has nothing to do with safe haven buying. Those buying #Bitcoin are merely speculating. Some may be speculating that others will buy it as a safe haven, but none actually are. There is nothing safe about Bitcoin!
— Peter Schiff (@PeterSchiff) January 29, 2020
Concerns of global trade issues may not be the only driving factor behind the bitcoin’s current rise. CME Group Bitcoin Futures, launched in December continue to grow in popularity among institutional investors. The futures contracts are notably settled in bitcoin, driving further demand for the cryptocurrency.
The forthcoming bitcoin “halving” in May may also be playing a role. The halving will see the supply of new bitcoin available through bitcoin mining halved, hence the name. The halving creates scarcity of new supply and basic economic 101 dictates that a scarcity of supply causes prices to increase.
The price of bitcoin is often compared to a rollercoaster ride and this current price spike may yet again be part of the ride. That aside, if bitcoin breaks through $10,000 again, the rise up this time around may see a return to prices last seen in 2017.
Since you’re here …
Show your support for our mission with our one-click subscription to our YouTube channel (below). The more subscribers we have, the more YouTube will suggest relevant enterprise and emerging technology content to you. Thanks!
Support our mission: >>>>>> SUBSCRIBE NOW >>>>>> to our YouTube channel.
… We’d also like to tell you about our mission and how you can help us fulfill it. SiliconANGLE Media Inc.’s business model is based on the intrinsic value of the content, not advertising. Unlike many online publications, we don’t have a paywall or run banner advertising, because we want to keep our journalism open, without influence or the need to chase traffic.The journalism, reporting and commentary on SiliconANGLE — along with live, unscripted video from our Silicon Valley studio and globe-trotting video teams at theCUBE — take a lot of hard work, time and money. Keeping the quality high requires the support of sponsors who are aligned with our vision of ad-free journalism content.
If you like the reporting, video interviews and other ad-free content here, please take a moment to check out a sample of the video content supported by our sponsors, tweet your support, and keep coming back to SiliconANGLE.