In its attempt to regain past glory, Bitcoin price breached another major milestone and crossed the $9,000 mark over the weekend. The original cryptocurrency first struck past the mark yesterday evening. It retraced its steps for a brief period of time two hours later before striking out again past $9,000.
As of this writing, Bitcoin is changing hands at $9,285.84 per Coindesk. Yesterday’s increase means that Bitcoin price is up by 150 percent since the start of this year. That’s an impressive reversal from the same time last year, when it was down by 57% from Jan 2018.
Cryptocurrency markets are following Bitcoin’s lead and have added approximately $10 billion to their overall value in the last 24 hours, based on statistics from coinmarketcap.com.
The top 10 cryptocurrencies by market capitalization are also inching upwards. Litecoin, which surged recently because it is expected to become scarce after undergoing halving, mostly remained flat and is priced at $135.60 by traders. Cryptocurrency exchange Binance’s BNB coin lost some value during Bitcoin’s ascent yesterday but has regained all of it and further added to its market cap. As of this writing, it is trading at $34.45, an increase of almost 5% from the same time yesterday.
What Caused the Bitcoin Price Rise?
Most experts and commentators are pointing to announcement of social media behemoth Facebook’s entry into cryptocurrencies as a catalyst for recent price moves.
The company has already signed up major financial services institutions and e-commerce companies for a foundation to govern its cryptocurrency. It has ambitious plans to use the crypto for e-commerce as well as money transfers between borders on its platform. RBC analysts released a note last week stating that Facebook will use crypto to “facilitate a platform for payments, commerce, and applications & gaming.” They wrote that the Facebook’s crypto gamble could become one of the most important initiatives in the history of the company to unlock new engagement and revenue streams.”
Facebook will release a whitepaper with details about its cryptocurrency tomorrow. Online publication Coindesk has also listed Binance’s decision to bar US traders on its platform as another factor driving trader enthusiasm for Bitcoin. The move is largely seen as preparation for its debut in US. Binance is the world’s biggest cryptocurrency exchange by trading volume.
Will it Continue to Rise?
The good news is that the fundamentals underpinning Bitcoin’s network are all flashing green. The number of transactions on its network has increased and the amount of hash rate, computing power devoted to mining Bitcoin and maintaining its network, has also increased. Analysts at Coindesk have forecast a brief drop in Bitcoin price after tomorrow’s announcement. “The long duration charts indicate that corrections, if any, could be short-lived,” they write. “Overall, it’s great to see that this breakout has not gotten out of control. We’ve seen the deterioration of a psychological resistance level that’s been holding for three weeks, but the breakout did not come with a drastic surge. This shows that the market is in a healthy incline, which is really the best possible scenario,” writes Mati Greenspan, analyst at eToro.