Bitcoin just surmounted the ₦2.91M ($8,000) level, topping out at ₦2.919 ($8,020)on Bitfinex before retreating to ₦2.876 ($7,900) at press time. Right now, reading about Bitcoin’s breach of its previous high may be getting repetitious, so strong gets the currency’s bull run been. This time around can be an exception, though, because Bitcoin just pulled the mother of head fakes.
A couple of days back, the SegWit2x hard fork was cancelled and the price immediately spiked from ₦2.620Mln ($7,200) to ₦2.839 Mln ($7,800). But within the hour, the purchase price had dropped and continued to fall further. Just a couple of days later, Bitcoin had sunk to a nearby low of ₦2.000Mln ($5,500) while rival Bitcoin Cash shot up from ₦218K ($600) to ₦946K ($2,600). During the time, a big quantity of Bitcoin miners had moved to Bitcoin Cash and the amount of unconfirmed transactions soared to over 135,000. Fees increased commensurately.
Things didn’t look good. Bitcoin had just officially eschewed the only real near-term treatment for the scalability crisis. SegWit, that has been adopted back August, will take care to gain traction as wallet providers must add the feature and users must voluntarily go with it. Lightning Network, Bitcoin’s long-term scaling plan, remains in testing and not ready for primetime yet. With the cancellation of 2MB blocks, it became obvious that there will be no quick fix to the currency’s scaling problem.
Waves of good news
However, Bitcoin Cash began rapidly dropping from its nearly vertical price ascent, miners came back once again to Bitcoin, and the transaction backlog subsided. Bitcoin’s price began to go up, and of the same quality news arrived, the cost moves became even larger.
What good news? Well, the British hedge fund Man Group, with over $100 bln in funds under management, announced they’ll begin trading Bitcoin once CME’s futures market is launched. Immediately following this, Payments app Square announced its full integration of Bitcoin in to the payments platform. The organization stated:
“We’re always listening to our customers and we’ve found that they are interested in using the Cash App to buy Bitcoin. We’re exploring how Square can make this experience faster and easier, and have rolled out this feature to a small number of Cash App customers. We believe cryptocurrency can greatly impact the ability of individuals to participate in the global financial system and we’re excited to learn more here.”
Square’s market capitalization swelled from ₦5.46 Trillion ($15 bln) to ₦8.824 Trillion ($16 bln) after the announcement, so Wall Street is apparently in the same way pleased while the Bitcoin community.
Adding to the good news, Coinbase today announced Coinbase Custody, a Bitcoin storage service intended for hedge funds that might want to invest in the digital currency. Coinbase’s announcement states:
“Over 100 hedge funds have been created in the past year exclusively to trade digital currency. An even greater number of traditional institutional investors are starting to look at trading digital assets (including family offices, sovereign wealth funds, traditional hedge funds, and more). By some estimates there is $10B of institutional money waiting on the sidelines to invest in digital currency today. When we speak with these institutions, they tell us that the number one thing preventing them from getting started is the existence of a digital asset custodian that they can trust to store client funds securely.”
The announcement continues, describing the benefits of the service:
We are designing Coinbase Custody to meet the needs of institutional clients. In particular, we feel that institutional clients require:
- Strict financial controls (multiple signers, audit trails, limits, etc)
- Dedicated account representatives and phone support
- SLAs on funds transfers
- A regulated digital currency custodian
- Multi-user accounts with separate permissions
- Support for a wide range of digital assets and currencies
- Insurance (in some cases)
- And high levels of cyber and physical security
The new service is expected to launch in 2018.
Expect sharp moves
Bitcoin’s technical analysts, who look at chart patterns to use and predict price moves, claim that the currency is approximately to see an important price move. Due to the rapid climb, analysis would appear to point that the purchase price should experience a pullback here to regroup and consolidate before pushing higher. However, around ₦2.9120Mln ($8,000) may be the the surface of the trading channel that Bitcoin has been around for months, and if the purchase price can resoundingly break through this barrier, it may go parabolic.
In an expression, Bitcoin’s value is even more than it seems, at the very least for people who owned Bitcoin prior to the August 1 fork and who held the resulting Bitcoin Cash they received. User csasker on the /r/BitcoinMarkets subreddit wrote:
BTG + BCH + BTC now over 9000! :D:DDD