Bitcoin Price Breaches $8,000 Mark, Up 11% in 24 Hours

Bitcoin price continued its ascendant path today, breaching the $8,000 price for the first time since the end of last July. As of this writing, the original cryptocurrency is trading at $8,154.27, up 10.91% from its price 24 hours ago. Just last week, it was changing hands for $5860.40 at the same time.

With the exception of stablecoin Tether, all other cryptocurrencies in the top ten are flashing green. Ripple’s XRP skyrocketed by more than 27.48% from its price 24 hours ago. Stellar’s Lumens also recorded double-digit gains. The overall market capitalization for cryptocurrencies also spiked higher to $241 billion, up from $222 billion a day earlier. Trading in bitcoin futures at CME also spiked up beyond $1 billion in a 10-month high.

What Caused the Price Spike?   

As in the past, there are several theories floating around. “Investors are looking at bitcoin as a way to diversify their portfolios against the volatile equities market,” said Ben Waters, Head of International Markets at IOST, a blockchain infrastructure company. He referenced the current trade tensions between the United States and China as proof. But correlation does not equal causation, as eToro analyst Mati Greenspan pointed out yesterday.

Rather, the reasons for Bitcoin’s price spike might be closer to home. Commentators and experts are pointing to a flood of positive news, mostly from industry conference Consensus taking in New York. There are rumors that eCommerce giant eBay might soon begin accepting cryptocurrencies on its site. Microsoft is reported to be building a decentralized identity blockchain project. Cryptocurrency exchange Gemini has tied up with a payments network company to enable retail purchases using cryptocurrency. Samsung and HTC have also announced features on their smartphones related to cryptocurrencies. Ripple’s XRP, meanwhile, is now available on North America’s largest cryptocurrency exchange Coinbase.

Institutional investors have also made announcements about their cryptocurrency products. For example, Fidelity Investments announced that it had signed up five clients, mostly crypto-native funds, for its custody solution. NYSE-backed bitcoin futures exchange Bakkt is readying itself for a July launch.

Will the Rally Last?

For long-time cryptocurrency investors, the current flurry of positive news about the industry is a script they’ve read before. Bitcoin’s trajectory towards $20,000 in 2017 was marked by a series of such news reports that claimed it would revolutionize the world of finance and investing.

That future did not materialize and the cryptocurrency, instead, fell into a prolonged swoon through all of 2018. Regardless of whether this rally sustains or not, the fundamentals of cryptocurrency markets still remain problematic. Liquidity is still a problem as is the absence of clear regulatory guidelines.

But the inflow of cash portends a good omen for blockchain development, at least. “Although discussions surrounding cryptocurrencies are often characterized by a level of speculation, positive market sentiments are always a good sign for the industry and an increase in bitcoin prices is often accompanied by a price spike for other altcoins,” said Matt Luczynski, founder of travala.com, a blockchain-based hotel booking platform. “With bitcoin confidently trading in the green once again, we can hope to see further advancements and investments in the blockchain space.”