Bitcoin surging again, nears its highest price
Celebrity endorsements, exchange outages, rafts of new trading accounts — Bitcoin mania is back.
In a flashback to the frenzied runup to Thanksgiving 2017, retail traders are piling into cryptocurrencies and driving prices back toward all-time highs. The number of first-time buyers is on course to eclipse December 2017, said EToro, an Israeli-British company. Bitcoin trades per day are 81 percent greater than the rest of 2020 combined. Google searches for “coinbase,” the crypto exchange, reached the highest level in at least a year, according to Google Trends.
And Crypto Twitter hasn’t been this giddy in a long time. A quick tour through various hashtags yields a wealth of frothy posts. There’s the GIF of a beaming waitress serving up glasses of champagne. “We bout to be rich,” goes the tweet. Another fan charts Bitcoin’s performance since 2017 and says, “and herewe are again.”
“Nothing like a pre-Thanksgiving Bitcoin run,” said Catherine Coley, CEO of Binance.US.
Bitcoin climbed within $100 of its all-time high after surpassing $19,000 for the first time since 2017. It’s now up more than 40 percent in November and has more than doubled in 2020. And the frenzy has spread to other coins. Dash surged 28 percent Tuesday, and Bitcoin Cash jumped15 percent. XRP rallied so quickly overnight that it reportedly caused an outage on the Coinbase exchange.
Overwhelming demand
First-time buyers have been flooding online investing apps with orders. Meanwhile, providers of digital wallets and payment apps are also seeing a big jump in crypto sales. Square Inc., a payments company based in San Francisco, said customers purchased $1.6 billion worth of Bitcoin using its Cash App in the third quarter, an 83 percent jump from the prior period.
Even celebrities are jumping in — Maisie Williams, the actor who played Arya Stark on “Game of Thrones,” bought Bitcoin even though a snap poll she held on Twitter said she shouldn’t. “Thank you for the advice. I bought some anyway,” she tweeted.
“We are only just beginning to see some of our retail clients borrowing against their Bitcoin to buy more Bitcoin, and that will ultimately propel the rally well into the $20,000s and beyond,” said Antoni Trenchev, co-founder and managing partner of Nexo in London, which bills itself as the world’s biggest crypto lender.
Trading got so intense over
night in XRP that U.S. cryptocurrency exchange Coinbase crashed, according to media reports. That sparked a plunge in the coin after the massive rally took it to a record.
Coinbase’s official status page says its website is operational and that an incident lateMonday has been resolved.
A spokesperson from Coinbase said they are looking into Bloomberg’s request for comment.
While Main Street investors may be dreaming about hitting a jackpot, more seasoned market veterans remain wary about the sudden boom. The crypto world is notoriously opaque, and unlike stocks or bonds, which are rooted in economic and business fundamentals, getting a read on what makes Bitcoin tick can be impossible even for the savviest investors
“Whenever I see mainstream media attention like this, that usually leads to a sell- off,” said Kevin Murcko, founder and CEO of CoinMetro, an Estonia-based crypto exchange.
“The big fish need to lay off risk, so they open the floodgates to bring in retail guys to dump on. Not sure this is the case this time around, but it seems a bit suspect.”
Even so, institutions are also jumping into the mix. In a report released last week, analysts with JPMorgan Chase& Co saidmoney managers were dumping gold and buying into the Grayscale Bitcoin Trust BTC, a listed security popular with institutions. The trust, which has amarket capitalization of $12 billion, is running at three times its numbers in the third quarter, the bank’s analysts said.