Bitcoin, the flagship cryptocurrency, has recently reached a five-month high after hitting the $5,000 mark on various exchanges, before the price fell slightly. The cryptocurrency’s jump was seemingly caused by a mysterious 20,000 BTC order.
The order, according to available data, helped BTC/USD trading pairs get to nearly 75% of the cryptocurrency’s total trading volume against fiat currencies and stablecoins for a short time, up from its usual 15%.
This was notably the first time BTC hit $5,000 since mid-November of last year, when it fell from over $6,000 to over $3,400 in the peak of the bear market that saw it drop from its near $20,000 all-time high in late 2017 to a low of $3,200 in December of last year.
The flagship cryptocurrency’s recovery from $3,200 to now close to $5,000 has seen some analysts claim the bear market has ended, and that in 2019 the crypto market will keep on recovering. Nevertheless, options traders have shown little confidence in the cryptocurrency hitting $10,000 this year.
After cryptocurrency prices collapsed by more than 75% last year, trading was dominated by small hedge funds and crypto-related firms according to Reuters. The recent 20,000 BTC order – worth nearly $100 million – was spread access Coinbase, Kraken, and Bitstamp, according to the CEO of cryptocurrency firm BCB Group, Landsberg-Sadie. He was quoted as saying:
There has been a single order that has been algorithmically-managed across these three venues, of around 20,000 BTC. If you look at the volumes on each of those three exchanges – there were in-concert, synchronized, units of volume of around 7,000 BTC in an hour.
What was behind the mysterious $100 million order is so far unclear, as analysts weren’t able to point to any specific development that could justify such a move. Since December’s low, the crypto markets have been relatively calm, with the recovery being slow and steady.
Altcoins See Significant Gains
Bitcoin wasn’t the only cryptocurrency moving upwards this week, as most altcoins followed suit, and some even outdid it. Bitcoin Cash, for example, is up by about 42% in the last 24-hour period, as it’s trading at $262, while Litecoin is up 20.2%, trading at $82.
Ethereum and XRP, the second and third-largest cryptoassets by market cap, rose 9.2% to $167.6 and 5.2% to $0.353 respectively, with BTC leading the rally. Speaking to Reuters, Charles Hayter, founder and CEO of CryptoCompare, noted these large orders “tend to spark buying by algorithmic traders.”
Hayter added that as bitcoin surged, 6 million traders occurred in only an hour, an amount “three to four times” larger than the usual. Most of these were concentrated on Asian-based exchanges, he said.
Speaking to CryptoGlobe Mati Greenspan, a senior market analyst at eToro, revealed the reasons behind the jump were “pretty simple.” He stated:
The market was eyeing the $4,200 level quite closely and it seems that crossing that barrier ended up triggering a bunch of stops and entry order.
When asked if he believes bitcoin’s price is going to stay on these levels or go back down, Greenspan thinks that at this point it remains unclear.