As Bitcoin Nears $10,000 "Central Banks Kept Up At Night"

The price of the largest cryptocurrency soared 16% over the weekend, bursting through $8,000 and $9,000 at a record pace and nearing the Maginot Line so many predicted at $10,000.

image courtesy of CoinTelegraph

$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

Bitcoin highs over the weekend at $9,721...

The 16% surge is, however, only the 4th biggest jump this year as Bitcoin is up 950% year-to-date.

As the price has soared, more and more mainstream interest has grown with one major exchange - Coinbase - now having more client accounts that Charles Schwab

“The Coinbase data is evidence that adoption is not slowing down,” Alistair Milne, the Monaco-based manager of the Altana Digital Currency Fund, told Reuters.

 

Furthermore, "promises of bitcoin futures opening the door to institutional money are supercharging the price," said Charles Hayter, founder of cryptocurrency data analysis website Cryptocompare.

Notably, as Bitcoin tops $160 billion, the market cap of all cryptocurrencies topped $300 billion for the first time - making their estimated market value greater than that of Wal-Mart.

However, as Reuters reports, the staggering price increases seen in the crypto-market have led to multiple warnings from central bankers, investment bankers and other investors that it has reached bubble territory.

Some say that this could prompt regulators in the West to crack down on the market in a similar fashion to China, where bitcoin exchanges were shut down earlier this year.

“Regulators know the rewards of cryptocurrency and blockchain could be huge but (they) have more than one eye on the catastrophic ramifications if good governance, stability and control are not preserved,” said David Futter, a fintech partner at law firm Ashurst, in London.

 

“If the carrot of self-regulation proves insufficient, the regulators will not hesitate to use their stick.”

Most critically though it is the central bankers that matter and they appear confused by crytpocurrencies' surge - some unable to sleep due to the disruptive change looming and others dismissive of the 'bubble'. As Reuters reports, it keeps them awake at night because these private currencies threaten their control of the banking system and money supply, which could undermine the monetary policies they use to manage inflation.

“The problem with bitcoin is that it could easily blow up and central banks could then be accused of not doing anything,” European Central Bank policymaker Ewald Nowotny told Reuters.

 

“So we’re trying to understand whether bank activity in relation to cryptocurrency trading needs to be better regulated.

“Bitcoin is a sort of tulip,” ECB Vice President Vitor Constancio said in September, comparing it to the Dutch 17th century trading bubble.

“It’s an instrument of speculation.”

China and South Korea, where cryptocurrency speculation is popular, banned fundraising through token launches, whereby a newly cryptocurrency is sold to finance a product development.

Russia’s central bank said it would block websites selling bitcoin and its rivals while the ECB told European Union lawmakers last year:

“they should not seek... to promote the use of virtual currencies” because these could “in principle affect the central banks’ control over the supply of money” and inflation.

But St. Louis Fed President James Bullard admitted to Reuters in a recent interview what the real concern was:

“(We could) wake up one day and most of the big banks have been eviscerated and most of that activity has moved elsewhere."

Yet Japan in April recognized bitcoin as legal tender and approved several companies as operators of cryptocurrency exchanges but required them register with the government.

Finally, in an effort to counter the private decentralized cryptocurrencies, some central banks such as Sweden’s Riksbank and the Bank of England are also looking at the merits of introducing their own digital currency.

But not everyone is concerned...

While US exchanges anxiously await the $10,000 as some sell-the-news event, Korean exchanges are already trading above $10,000 and holding it...

Source: Bithumb

Comments

overbet BaBaBouy Mon, 11/27/2017 - 12:45 Permalink

Yes of course long BTC is all about dumping fiat. Point being those post 2 months ago, we let the haters paper sell the high after it had dumped to about low 3k then popped back to 4300 over a couple strong days.The haters were saying no way id buy here no fucking way im buying these highs at 4300.  OoooppppssssOnly way anything makes new highs is when people buy new highs. Somebody was buying the AMZN ath friday. Nice trade today.  Sure those haters would say the same thing today.

In reply to by BaBaBouy

Luc X. Ifer Think for yourself Mon, 11/27/2017 - 13:20 Permalink

Bitcoin, ethereum, bitcoin, ethereum, bitcoin, ethereum ... *BS* etc.
Folks, Litecoin is the shit, LTC is the only one with fast enough *NOW* transaction times to become a real payment channel not only a store of value.
People understood this and Litecoin is exploding right now just look at the chart.
Litecoin has solid technical foundation and is led by an experienced, pragmatic industry expert
not by kids and speculants.

https://www.worldcoinindex.com/coin/litecoin

In reply to by Think for yourself

hedgeless_horseman Spaced Out Mon, 11/27/2017 - 14:10 Permalink

 Still only a few weirdos like all of us here on ZH have actually figured out how to own it...

http://www.zerohedge.com/news/2017-09-11/hedgelesshorsemans-e-z-interne…

I have asked maybe a hundred people in my day-to-day life if they own any Bitcoin.  Zero (0) have said yes.Most have no idea what it is.A minority have heard of it.In the last 6 months, I have been able to help exactly three interested friends (not on ZH) actually obtain their first crypto currency.We are still very early in Geoffrey Moore's technology adoption curve, having yet to cross the chasm to the Early Majority, as far as I can tell.I am not selling my gold, or investing any money I cannot afford to lose, but I am thrilled at this opportunity to disintermediate the banks.So, for now, my plan is... With McAfee's price target of $500,000 inside of three years.I have seen crazier things happen.

In reply to by Spaced Out

Robert A. Heinlein hedgeless_horseman Mon, 11/27/2017 - 14:16 Permalink

I'm with ya. None of my friends know about this yet. Yea, they've 'heard' about it, but they go no idea what it is let alone how to buy. Took me months to figure it out. The majority of my coin is LTC but I have the three bigs one, BTC AND ETH. Last week was at the bank moving money to buy more bitcoins and talking to the manager about them, he was clueless.  Had no idea what I was talking about. Just then a woman walked up and exclaimed 'bitcoin'?!, my son was into that years ago. She then went on to tell me he bought some and decided for secruity he would put them on a memory stick. Oh, this is sick. He lost the stick some how. The coins he bought back years ago she said are worth some $12,000,000 ($12M) dollars! Yikes. Hope they find it.  If I was them, I'd tear that house down piece by piece till I found it!  LOL 

In reply to by hedgeless_horseman

MonetaryApostate Robert A. Heinlein Mon, 11/27/2017 - 21:57 Permalink

You aren't seeing why Max Keiser & the British Kleptocrats are pumping Crypto, they are trying to totally crash the economy & end cash, & if the CIA & MIC importing in BILLIONS in drugs doesn't tell you something, you'll never see it coming...So the only question the serfs need to ask themselves is, why did they permit all of the massive immigration?D E C O L O N I Z A T I O N!!!!

In reply to by Robert A. Heinlein

Urban Roman hedgeless_horseman Mon, 11/27/2017 - 18:31 Permalink

I had about 40 of them, several years ago. Sadly, I didn't take them seriously. I thought they were wildly overbought at $250.Cashed out most of them (from Mtgox at the time, just before it went titsup)... moved the remaining coins to a non-authenticated BTC-e account. Never got around to cold storage. Was swapping back and forth between LTC and BTC, trying to figure out this 'trading' thing ... eventually got frustrated, leaving most of them as LTC.By the way, congratulations to the BTC-e technical team. They salvaged around 65% of the Cryptos, whle thieving 'regulators' seized all their fiat cash. That they could do this is a testament to the security designed into Cryptos.So I still have this little fraction of a BTC, left over from the experiment a few years ago. Most of it now in LTC & DASH, and in 'Tokens'.Hmmm ... does it make sense to put any more fiats into the Crypto space? And into what? IOT, VTC, DOGE, ETH, or ZEC? (jk, not DOGE)

In reply to by hedgeless_horseman

Luc X. Ifer Spaced Out Mon, 11/27/2017 - 14:39 Permalink

Nope. None like LTC. LTC has particularities. It has a long industry/market life span and moved steady. It shown what enterprise is looking for - a proven, strategically led & driven stack, a stack which 'can do it and deliver'. CL moved smartly Chinese style, long term strategic thinking not trying to exploit & cheat on the hype of the moment. CL wants to win the war not only few battles. He has Google & Coinbase experience and the fact that he recently decided to go along shows that this is his intention, long term strategy to win & lead.

In reply to by Spaced Out

CHX13 Spaced Out Tue, 11/28/2017 - 05:22 Permalink

Yes, stocks, bonds, real estate (topping?), BTC, etc. But the bubble is debt-fueled fiat money. And when (not if, but there is no knowing about the "correct" timing) the music stops it will all flow back to the metals (first gold), the CB's base money. *THEY* benefit from BTC as this is the modern age confiscation of phyzz IMHO. Time will tell how it all pans out. For most likely not too good when it is all said and done. That said, I wish GLTA as we all will need it before long - BCT @ 1mm or not.

In reply to by Spaced Out

Luc X. Ifer JimmyJones Mon, 11/27/2017 - 13:46 Permalink

I don't recommend that. Truth is, it takes solid technical background to understand why, but shortly, it is because Ethereum grew to fast on a pure research but weak technical foundation and they face enormous technical challenges as they close on the scalability limits due to poor initial choices of technologies meant just to deliver a PoC level of functionality. Between great theoretical white/yellow papers and technical realisation is a big distance and only seasoned industry experience can close the gap effectively - the guys who started Ethereum lacked the 2nd but critical part.https://www.forbes.com/sites/cbovaird/2017/11/27/litecoin-reaches-a-fre… 

In reply to by JimmyJones

yardsale Think for yourself Mon, 11/27/2017 - 17:36 Permalink

ASIC resistant algos are in a bullish undercurrent at the moment.  Zcash is strong as is the first fork, KMD (Komodo).  Bitcoin gold also uses equihash like Zcash.   As far as the bullish themes go, I think store of value is obviously #1 given BTC gains, then new-new thing with IOTA, then TX speed is still strong with Dash, then perhaps the ASIC resistant coins. Privacy is always big, but I'm not sure I see that action in the coins at the moment.

In reply to by Think for yourself

IH8OBAMA overbet Mon, 11/27/2017 - 12:41 Permalink

I'm dissappointed that the Bitcon ran up near $10,000 before the CME futures start date. (Dec. 10th)  Institutions will start yanking the price all over the place when trading starts and I was hoping to get close to $10k just before that volitility starts.But now that it is here already is the $10k print going to cause more volatility than the futures start or will it run higher into that date?  Ahh, delimmas. 

In reply to by overbet

Think for yourself IH8OBAMA Mon, 11/27/2017 - 13:02 Permalink

Expecting a short-term correction meanwhile alts like LTC & ETH will keep performing. Shift 50% of ETH and LTC into BTC if it drop below 7k, 75% if it drops below 6k.I know Tmos (fairly enough) doesn't trust the fundamentals of BTC. But I think that the psychological game of adoption momentum still favors BTC before people realize that alts are more promising.BTW, Dash kind of caught up from it's sideways trading but ZCash is still looking undervalued with lots of upwards pressure building up. What do crypto traders (with skin in the game) think about Zcash?

In reply to by IH8OBAMA

Two-bits Think for yourself Mon, 11/27/2017 - 13:20 Permalink

I'm right there with you. I expected a 10% swing to $9k before pushing through $10k. Not sure about Zcash. Seen some talk about it, but nothing that I'd go throwing money at while BTC does its dance with $10k Those looking to get into the crypto space to see how transactions work, get your fractional BTC, LTC, Dash, and Doge stop by cryptodrip. Not 7k a week, but it is a way to exchange your time for crypto if your dollars aren't ready to leave your pocket.

In reply to by Think for yourself