Bitcoin Explodes Above $14,000 - Korean PM Fears "Serious Pathological Phenomena"

Tyler Durden's picture

Well that escalated quickly...

Just a few hours ago, Bitcoin surged above $13,000 and now, on notable volume, it has reached the stunning $14,000 level... up 20% today...

The real surge began at 1715ET...

For those keeping track, this is how long it has taken the cryptocurrency to cross the key psychological levels:

  • $0000 - $1000: 1789 days
  • $1000- $2000: 1271 days
  • $2000- $3000: 23 days
  • $3000- $4000: 62 days
  • $4000- $5000: 61 days
  • $5000- $6000: 8 days
  • $6000- $7000: 13 days
  • $7000- $8000: 14 days
  • $8000- $9000: 9 days
  • $9000-$10000: 2 days
  • $10000-$11000: 1 day
  • $11000-$12000: 6 days
  • $12,000-$13,000: 17 hours
  • $13,000-$14,000: 4 hours

As Bitcoin has soared, it appears traders have sold other cyrptocurrencies to chase it as Ether has dropped in sync..

One of the regions in the world with the most active Bitcoin community is South Korea where so many Koreans have embraced bitcoin that the prime minister recently warned that cryptocurrencies might corrupt the nation’s youth.

As Bloomberg reports, while neighboring Japan hosts more transactions by some measures, Korea punches far above its weight: In the 24-hour period through Wednesday evening in Seoul, about 21 percent of the world’s bitcoin trades on fee-charging venues involved the Korean won, according to Coinmarketcap.com. The country accounts for about 1.9 percent of the world economy.

As Korean policy makers grow increasingly worried that the mania has gone too far, the nation could become a focus for bitcoin traders around the world. Korea’s top financial watchdog, which briefly roiled cryptocurrency markets with its ban on initial coin offerings in September, said this week that it has “grave concerns” about overheated speculation and has formed a task force with other government bodies to increase supervision.

While it’s unclear what measures will emerge from Korea’s cryptocurrency task force, the government seems intent on acting. The tax authority is considering a levy on cryptocurrency trading gains, Yonhap News reported on Tuesday, while Prime Minister Lee Nak-yon warned last month that cryptocurrencies could become gateways to pyramid schemes and other illicit activity if left unchecked.

“If we let things continue, I feel some serious pathological phenomena could occur,” Lee said.

Bitcoin’s stateless status appeals to some Koreans who’ve grown wary of keeping their savings in a country that shares a border with Kim Jong Un’s increasingly belligerent regime in North Korea, according to Kwak Keumjoo, professor of psychology at Seoul National University.

“People want to take comfort in something outside and beyond the country,” Kwak said.

Finally, we note that growth continues as Coinbase CEO today noted they currently have 220 customer service reps and will add 400 next year:

"it's very difficult to keep up with the user influx."

As CoinTelegraph reports, since ChinaRussia, and a few others cracked down hard on Bitcoin, it has been relatively quiet on the regulations front as Bitcoin has continued to soar unbridled. However, the head scratching on how to regulate continues.

The next fear, for Former Fortress Hedge Fund Manager Michael Novogratz, is that Bitcoin’s continued rise and prominence in the mainstream media could reawaken the regulation beast.

However, Novogratz still feels that Bitcoin is difficult to regulate and it will be hard for governments to make an impact immediately. Novogratz, who has been outspoken on Bitcoin for some time now, claiming it could be a bubble, but one to profit from has his concerns now.

"I've got concerns that if price movements go higher, we're going to get more regulation," Novogratz said.

 

“But I think it's hard to shut down. ... I don't think that's a probability."

 

"One of the big risks out there right now is that prices are moving so fast that regulators are going to get nervous," he added.

 

"I could legitimately see Bitcoin go $13,000, $14,000, $20,000, $25,000 and see somebody balk."

Novogratz adds:

"We're in a speculative frenzy. Period. Stop. How long can it go? Who knows," Novogratz said. "What's interesting about this is it's global."

Another reason that Bitcoin has hit such heights must also be attributed to it finding its identity. Many were scratching their heads as to what Bitcoin is - a currency or an asset - but recent changes have set it straight.

"Bitcoin is winning out as digital gold," Novogratz explained.

 

"I don't think it's going to be a currency... Nothing that volatile is going to be a currency."

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buttmusk's picture

how many people who own bitcoin use it? how many people who own a facebook account use it

Omega_Man's picture

so....when the war starts in NK... there will be no more inflows as banks will stop letting the fools pour their money in... then it crashes... mericans sell... can't get your money from exchanges... Mt. Gox 2.0 ...  hahha... suckers.... gold and silver will rocket... mericans will be hated after 1 million dead in korea, then all will hate and despise mericans 

Nature_Boy_Wooooo's picture

Try fleeing from your post in North Korea to South Korea with gold bars in your pockets while your buddies are shooting at you.

Gold sucks.

 

FreeEarCandy's picture

The idea of preserving value means the instrument cannot rise or fall in value under any circumstance. If the value of an instrument rises and falls, then one does not have preservation of value. One has risk, uncertainty, chance. Think of preservation of wealth as a container. If there are holes in the bottom of your container and the lid is missing, then chances are stuff/value is going to leak in and/or leak out. There are not many things that do not have holes in them and accordingly their value rises and falls. In terms of preservation, the containers that have the smallest holes are the most sought after, because their value is not prone to leak out as quickly as the ones with big holes. Generally speaking, if you want to preserve value, then you want your stuff sealed tightly so that what you put into your container is still there when you want it-no more and no less. Anything else is an investment that comes with risk and chance. 

Victor999's picture

Not quite correct.  Preserving value means that the asset will fluctuate in an inversely proportional manner with the current monetary standard.  So if the dollar loses value, gold then increases proportionally in value relative to the dollar, thus preserving wealth.

Victor999's picture

Bitcoin is rising so fast because there are few capital controls on it.  When the governments start cracking down on the bitcoin exchanges, regulating what goes in, identifying who is realising profits for sales over a certain amount, and begin taxing those realised profits, then we will see a steadying out of the market, perhaps even a precipitous fall in value.  There is even the outside possibility that the government might even stop the exchanges from doing business altogether - if that happened, then where would bitcoin pricing go when people lose easy access?  Never believe that bitcoin or any cryptocurrency is untouchable by government - it is and it will be.

 

And when chaos reigns in the financial markets, and bitcoin exchanges are outlawed to protect capital outflows, then what will people do who have invested their savings in it?  I don't really think this will happen, because I believe the bitcoin phenomenon is in reality a'controlled opposition' to cash, a means to convince people to give up cash and move to a global all-digital society where the government and the banks will have complete control over your spending.  They would never be able to convince people to give up cash by forcing it down their throats, so bitcoin was created to make them think they were doing it voluntarilly... ;-)

 

At least gold in my hands, though not as dramatic today, is something I can always trade for value.

Nature_Boy_Wooooo's picture

Because we all know the government would never force you to forfeit all of your gold.

 

 

Victor999's picture

That's possible.  Certainly there is precedent for it.  But gold then just goes underground, being traded under the covers.

 

The government will ultimately guaranteee cryptocurrency success as it wants to control every penny you do business with - and if you don't behave, they can cut you off, just like that.

Exponere Mendaces's picture

Bitcoin exchanges are regulated in the USA.

And other places too, but that messes up your convenient narrative, doesn't it.

Any government that outlaws Bitcoin only hastens its adoption.

For comparison, certain drugs are outlawed - and they've never been stopped. What makes you think Bitcoin, with a global network and satellites in space, is going to have any problems being traded anywhere else?

Oh that's right, you're a gold maximalist.

 

Thom Paine's picture

Bitcoin will $400,000,000 before Christmas

JPMorgan's picture

Convert some gains into hard assets, that's the smart move.

 

buttmusk's picture

stock market = speculative bubble created by the rich, bitcoin = speculative bubble created by the poor. all the result of central bank policies

quasi_verbatim's picture

You can put your money in, but can you get your money out?

buttmusk's picture

only if you sell before the final peak. if not u will lose it all

MusicIsYou's picture

Good the higher it goes the more fun it will be when Bitcoin gets obliterated.

East Indian's picture

"the prime minister recently warned that cryptocurrencies might corrupt the nation’s youth."

 Yeah. The digital debt instrument that is whipped out of thin air by the banksters and passes for money is healthy and moral. 

 

The Prime Minister is scared that his masters are losing their controlling positions in the economy.

To hell with the banksters. 

Satoshi hated the banksters. 

And BTC is the digital thermometer that shows if you are suffering from hyperinflation.

Apparently the whole worlds is. 

This is the breaking of the liquidity trap. Run for your life. Buy an asset you can keep in your person or within the range of your gun.

buttmusk's picture

nope its a poor man's bubble. that's why you don't see things like real estate skyrocketing. they can't qualify for mortgages. and too stupid to buy real assets apparently.

Exponere Mendaces's picture

I don't know any poor Bitcoin holders.

But I do know a lot of people underwater on their "safe" houses.

buttmusk's picture

it sounds like you know a lot of very stupid people. maybe you are too? how could anyone be "underwater" on a house in 2017. are you trying to say they are overleveraged and can't afford the mortgage payment because they purchased a home above their means? underwater means the saleable market value is lower than the mortgage principal owed. you must live in a really crappy area if that is the case. detroit?

Bananamerican's picture

and for one brief golden moment in human history, some 17th century Dutchman, with an attic full of purple flowers, was the Jeff Bezos of HIS day.

"At one point 12 acres of land were offered for a Semper Augustus bulb"

Bananamerican's picture

i think buttmusk is right (I can't believe i just typed that)...

the peanuts gallery missed ALL those other lovely bubbles in tech, housing, stock, bonds, commodities...tehy are NOT going to miss THIS one. – Love and kisses, all the gang down at Illuminati™ HQ

ThePhantom's picture

 its pulling everyone in... a type of black hole or event horizon.  its going up. you just can't resitst 5% up per day with some 30 %updays and the chart is going big time hockey stick... the general public is still scratching their asses wondering WTF is bitcoin... they are coming ... guaranteed this "ponzi" is not over.... if it is a ponzi. but what isn't? 

HRH of Aquitaine 2.0's picture

The price could go past $15K in a few minutes! HOLY COW THIS IS INSANE!

MusicIsYou's picture

Congress can't even legislate repairing U.S infrastructure or the D grade given to U.S infrastructure. Congress can't effectively legislative jackshit.

ThePhantom's picture

no one knows.... take a risk and see.

MusicIsYou's picture

Congress is too busy sucking off each other  and feeling up interns and staff members for them to even legislate repairing U.S infrastructure. 

MusicIsYou's picture

If the dollar tanks everything bought with dollars tanks. Like case in point only 1% of people own bitcoin or gold- so most people won't exchange their goods for your electrons or rocks. 

Cast Iron Skillet's picture

strange logic. I would have thought that by nature "the dollar tanking" would mean that other goods rise in value as measured with Dollars.

Bananamerican's picture

you heard the man..."ya can't eat electrons"

MusicIsYou's picture

If the dollar tanks society is going back in time 10,000 years to  a time before gold even had value. That's because most millennials see no value in gold, hell they aren't even getting married and buying gold wedding bands.

buttmusk's picture

sugar daddies will still be buying their sugar babies lots of nice jewelry

Bananamerican's picture

no. they won't be out charging Bitcoins for 20 year-olds...they'll be IN court defending themselves against 20 year old molestation charges

Lparadise's picture

Thare is a really interesting angle on what is going on with Bitcoin, based on option prices.

Basically it could go to 100,000 or 1,000 and the catalyst will be the introduction of new exchanges

This is the article

https://www.smartkarma.com/insights/the-volatility-of-bitcoin

Exponere Mendaces's picture

https://www.buybitcoinworldwide.com/volatility-index/

Volatility is 4%... but good luck with the "binary option" presented in that "article".

We've been around this bush before, it only gets dragged out again when we rally or have a big decline.

 

MusicIsYou's picture

Civilization is completely utterly fcked, people just don't realize yet how much.

MusicIsYou's picture

It's funny how people think the government is going to takeover our healthcare and have cameras and security everywhere. Those fcking idiots can't even manage the U.S infrastructure we already have

 

East Indian's picture

Just breached the $15k barrier (08:52 GMT) 

NickPeeMe's picture

It is time to mortgage the house and borrow every penny you can steal to catch this train before it leaves the station. Be the first Buttcoin billionaire on your block. Your nobody until your entire portfolio is riding the bits and bytes of the internet. What could possibly go wrong? 

MrNoItAll's picture

We're living in a time when there are very few truly productive investments left. Markets are saturated. Companies are buying back their own stock rather than investing because there isn't much worthwhile left to invest in. The only "profitable" places to put money these days are into speculation and gambling. The global economy these days is nothing if not a debt-fueled speculative frenzy. Ponzi-like activity everywhere. Bitcoin is expanding so fast because the media narrative that gets through to most people has succeeded in semi-legitimizing Bitcoin (i.e., it is "currency", or a viable substitute for holding precious metals). Whatever. I see the Bitcoin phenomena as a last gasp of this sick no-rules everything goes global economy. Of course the ones who get out soon enough will be filthy rich geniuses, but looking at all the speculative frenzies of the past and counting the winners and losers, I think I'll sit this craze out.