Bitcoin has been trading around the 8,200 dollar mark for the past few days after reaching the $8,000 cap on Friday. Several marketing analysts are pointing to another rally that will bring Bitcoin well into the $9,000 territory by the end of the month. This is a stunning achievement vfor a crypto currency that was trading at just over $2500 in August and was no more than $800 at the beginning of the year.
Bitcoin is a "real" asset but it's currently in a bubble, according to a CNBC survey of global finance bosses, with many calling it a "fraud."
Ninety-seven chief financial officers (CFOs) on CNBC's Global CFO Council were asked their view on bitcoin. Out of the 43 that responded, 27.9 percent said the cryptocurrency is "real but in a bubble." Another 14 percent said that bitcoin is "real and still going higher."
Meanwhile, 27.9 percent said bitcoin is a "fraud" while 30.2 percent of CFOs said they don't know enough about the digital currency to have an opinion.
Of the finance chiefs based in Europe, the Middle East, and Africa, 41.7 percent said that bitcoin is "real but in a bubble" compared to 20.8 percent in the U.S. and 28.6 percent in the Asia Pacific region. A third of respondents in EMEA also think bitcoin is a "fraud," higher than their counterparts in the other regions across the world.
The bitcoin price touched the $8,000 mark on Friday morning (or Thursday night, depending on your time zone), enabling the flagship cryptocurrency to check another milestone off its to-do list before it reaches five-figure territory.
Bitcoin Price Touches $8,000
Just days prior, the bitcoin price had been trading below $6,000, but a mid-week rally raised bitcoin back to its pre-dip level and ultimately vaulted it to a new all-time high of $8,040 on cryptocurrency exchange Bitfinex.
At present, the bitcoin price is trading at a global average of $7,741, which translates into a $129.2 billion market cap.
3 Factors Behind Bitcoin’s Rally
While a multitude of factors contribute to the movement of the bitcoin price, three stand out as primary drivers of the present rally:
1. Wall Street’s Anticipated Entry Into the Markets
Ever since regulated U.S. derivatives exchange operator CME announced it would add bitcoin futures contracts to its product offering, analysts have been counting down the days until Wall Street makes its first major entry into the cryptocurrency ecosystem. Anecdotal evidence indicates that prominent institutional investors are eying the markets with interest — enough interest that Coinbase is launching a cryptocurrency custodial service specifically targeted at institutional investors with more than $10 million in crypto assets.
Related to this is the fact that Wall Street investors are increasingly bullish on publicly-traded companies that enter the bitcoin or blockchain space. Payment processor Square, for instance, received a significant bump to its share price after it rolled out a bitcoin pilot program to a limited number of users of its Square Cash app.
2. Successful Lightning-Based Atomic Swap
Though less likely to make its way into the mainstream press, another factor influencing bitcoin’s rally is the successful completion of the first off-chain atomic swap. Accomplished using lightning network technology, developers at Lightning Labs traded testnet bitcoin for testnet litecoin trustlessly and without leaving a record of the transaction in either blockchain. Once the lightning network reaches mainnet implementation, this feature will enable the creation of decentralized cryptocurrency exchanges.
Finally, some analysts believe that the bitcoin price received a small bump due to the fact that a minority percentage of miners continued to signal for SegWit2x even though the fork’s most prominent advocates had called for its cancellation. Spencer Bogart, head of research at Blockchain Capital, had told Bloomberg Quint that he believed “some capital is rotating out of other crypto-assets and into bitcoin to make sure they receive coins on both sides of the fork” in the event that it did execute as planned. However, the fork did not occur— or at least has not yet — and fork-compatible nodes remain stuck at block 494782.