By
Temitope Olatunji
April 18th, 2024
Bitcoin price appears to have experienced a sudden and unexplained rise sending the coin soaring to nearly $5,000. Here’s the possible reasons for that.
Bitcoin has seen its biggest positive surge in price for several months, climbing to a 2019 all-time high of $5100 on BitMex. The price increase sees BTC touch November 2018 prices, with the entire market cap also surging over $20 billion.
So what are the possible reasons for Bitcoins price surge today?
At the time of writing Bitcoin was at the 14.95% surge to $4.752. The digital asset has added over $14 billion to its market value in the last 24 hours, according to CoinMarketCap. A simple glance at the price stable shows that all the top-twenty altcoins have surged between 5-15%.
Ethereum (ETH) with a 5.53% gain is trading at $150.20 at the press time. Over the last one week, Ethereum has shown steady progress gaining nearly 15%. Overcoming the crucial resistance of $150, Ethereum’s market cap now stands at $15.8 billion. The number-three cryptocurrency, XRP, also made a 5.33% surge.
Experts attributed the price hike to a breakout from a closely-watched resistance level of $4,200. Bitcoin had been hovering around the $4,000 mark for several months. Mati Greenspan, senior market analyst at trading platform eToro said:
“Bitcoin’s break above $4,200 this morning was critical, as the market had been watching that level for a while. No doubt some entry orders and stop losses were grouped right above.”
Meaning that certain algorithmic trades had kicked in after it reached this higher level. It comes after a massive slump for the cryptocurrency market last year. Bitcoin fell over 76 percent in 2018, and is still well below an all-time high near $20,000 it notched in December 2017.
Forbes’s analyst Naeem Aslan says:
“The fact is that 2019 is turning out to be a good year for Bitcoin. We have three consecutive months of gains as shown in the chart below. This is the first time we have this trend. These three consecutive months have more momentum in terms of price action compared to the last three months of 2018. What could also attract retail money is the fact that we have six consecutive weeks of gains, a trend not seen since the price made an all-time high.”
He adds that the smart money is mostly interested to get involved in a bear market because the risk to reward ratio is at its peak.
“Bitcoin has the potential to topple the $100,000 mark and it is only a matter of time when this becomes a reality .”
Is This Something More than Just a Technical Bounce?
In a tongue-in-cheek response, Blockstream CSO Samson Mow concluded the new spike simply came down to investors buying and holding bitcoin.
“Today’s spike in Bitcoin’s price was caused by more people buying and holding.”
– Samson Mow
(Media, feel free to quote me in the articles.)
— Samson Mow (@Excellion) April 2, 2019
Simon Peters, an analyst at eToro, when this week value started to climb, said:
“As the price of Bitcoin continues its much welcomed momentum, some investors are now eagerly awaiting to see [what happens next]. Bitcoin has failed to break this ceiling so far in 2019, and therefore this price movement would be significant. Investors should hold their horses, as only once we’ve seen a break and, importantly, the price stays above $4,200, can people perhaps start to turn bullish for the long-term.”
April’s Fool Jokes as a Possible Reason? Buffett buys Bitcoin
This news circulated yesterday, during April fools day, stating that the SEC had approved the Bitcoin ETF. This decision has been pending for nearly a year now. The story, however, was fake and was simply an April fools day joke.
Another possible reason could be the news that American business magnate Warren Buffett was said to be diversifying into Bitcoin. However, this news was old shared on April fools day, proving to be fake news as well.
Seems no one had a clue what was really happening. CEO of Binance Changpeng Zhao tweeted:
anyone know any news? I have been asked "a few" times, but honestly clueless.
— CZ 🔶 Binance (@cz_binance) April 2, 2019
Bitcoin has a history of gaining in price, from one year before a halving, history has shown that generally, the price of Bitcoin increases from one year before the halving of the block rewards. With just over 12 months remaining before the 2020 BTC halving perhaps traders have realized this and priced in the potential movements.
At this point, it’s too early to say what the exact catalyst for this Bitcoin run is, but with the positive sentiment in the market, maybe there doesn’t have to be a reason at all.