According to CryptoCompare, at 07:30 UTC on Sunday (May 12), the Bitcoin (BTC) price surged past $7,500 to reach $7,536 half an hour later, a level last seen on 2 August 2018. We take a closer look at Bitcoin’s recent price action, and discuss several potential reasons that could (at least in part) explain it.
And it is not just Bitcoin that is enjoying a tremendous bull run, as all of the major altcoins in the top 10 seem to have now joined the party.
Here are the 24-hour price charts for Ethereum (ETH), Bitcoin Cash (), Litecoin (LTC), and Cardano (ADA):
Before we examine some potential reasons for why the crypto markets are enjoying a very nice bull run at the moment, let’s take a closer at what has been happening this weekend.
Here are a few tweets from prominent members of the crypto community that might give you a better idea of what the mood is like:
Vinny Lingham, CEO at Civic:
If Bitcoin can hold the $6200 level for the next 24-48 hours, then the bear market is officially over and I’m going to become a raging bull!
— Vinny Lingham (@VinnyLingham) May 10, 2019
Dovey Wan, Co-Founder of Primitive Ventures:
If we break out $7300, we are going to the fucking moon.
As it’s both a former level of support/resistance as well as a big round number of ￥50000 RMB
— Dovey Wan 🗝 🦖 (@DoveyWan) May 11, 2019
Asia wakes up 🚀🚀🚀 ￥50000 RMB accomplished🔥🔥🔥 this gonna be massive if it holds for another 8 hours or so
$7300/￥50000 maybe the the most strategic level of this cycle pic.twitter.com/q1FOT50Dyj
— Dovey Wan 🗝 🦖 (@DoveyWan) May 12, 2019
Arthur Hayes, Co-Founcer and CEO of BitMEX:
New record for BitMEX trading volume. Praise be to volatility and our wonderful traders! pic.twitter.com/iLMGdpz65n
— Arthur Hayes (@CryptoHayes) May 12, 2019
We can’t be sure if we are firmly in the bull territory or if we are, how long this crypto price rally will continue, but we can speculate as to the reasons behind it. The most popular and pluasible explanations (in no particular order) seem to be as follows:
- Improving technicals, such as last month’s double break out of Bitcoin price upon the “Golden Cross”;
- Traders exiting their Tether (USDT) positions and getting into Bitcoin and the major altcoins, especially after the office of the New York Attorney General (NYAG) announced that it was investigating Bitfinex and Tether (and the resulting revelation that Tether was only 74% backed by cash and cash equivalents).
- Tether (USDT) managing to maintain its peg to the dollar despite all the drama surrounding Bifinex and Tether (unlike what happened in October 2018, when USDT fell to as low as $0.86).
- The countdown to Bitcoin’s next block reward halving event, which is estimated to take place on 23 May 2020.
- Bloomberg reporting on May 6 that Fidelity Investments “will buy and sell the world’s most popular digital asset for institutional customers within a few weeks.”
- Reports that came out towards the end of last month about two of the biggest brokerages in the U.S., E*Trade Financial and TD Ameritrade, preparing to launch Bitcoin trading on their platforms.
- The Wall Street Journal’s article (published on May 2) about Facebook’s crypto-based payments system.
- Diar Research reporting on May 6 that for Bitcoin the number of transactions on-chain is “just shy of the all-time-high of December 2017.”
- The realization by many that “we must be in a bull market” after the attack on Binance on May 7 since it seemingly had no negative impact on the price of Bitcoin.
- U.S. Congressman Bradley Sherman (D-CA) asking his colleagues to introduce “a bill to outlaw cryptocurrency purchases by Americans” being taken as a bullish sign by many fans of crypto, such as Anthony Pompliano (aka “Pomp), who said on May 10 that Congressman Sherman’s remarks only served as an ad for crypto and helped to confirm its validity.
- New York City Blockchain Week.
- The Fear of Missing Out (FOMO).
Featured Image Credit: Photo via Pixabay.com