IT'S AN ALL-TIME HIGH FOR BITCOIN AS IT RACES PAST $5,000Date: 2017-10-13
Bitcoin has blown past the $5,000 mark.
The price for the controversial crypto-currency soared by more than $500 on Thursday to over $5,380, bringing it to an all-time high.
The latest rally appears to have been driven by a mix of upcoming engineering changes that make it easier to acquire new coins as well as confirmed rumours that China, Amazon and Google will soon be more open to the asset in the near future.
“There’s the fear of missing out,” Sam Doctor, quant strategist at Fundstrat Global Advisors.
“Psychologically a lot of investors may feel like now is the time to pull the trigger,” he added. “That might be one of the factors at play.”
In 2017 Bitcoin soared 456% making it one of the best-performing assets and most divisive investment on and off Wall Street. By comparison, the S&P 500 Index's 14.1% rise this year looks downright paltry. On September 1, Bitcoin approached the first $5,000 mark and the currency related to as low as $3,058 on September 15 after China closed an exchange in the country.
The sudden move forward comes weeks before the latest split that will result in a new form of currency called Bitcoin Gold.
Once Bitcoin Gold is established it will be easier and cheaper for investors to "mine" new coins, which is a process that takes substantial computing power to the next level.
Before the last time Bitcoin was forked, August 1, investors freaked out and sent the currency down by as much as a third on a single day in June, to just above $2,000 a coin.
But there are other factors at play among traders, says Oliver Bussmann, former CIO at UBS who runs his own Bitcoin consultancy.
“There are rumours on the street that Amazon and Google are ready to accept bitcoin for their services,” he said. He added that investors are spreading rumours that China may reverse its decision from last month and issue licenses for bitcoin exchanges.
“Do I think we are just in the beginning?” Bussmann asked. “Yes. I think so.”