Whats really driving the price of Bitcoin through the roof

Although Bitcoin is electronic and moves quickly, the real world doesn't.  Since Bitcoin (which is colloquially BTC/USD) has been in the news, millions have decided to put their own money into the Crypto world and press their luck.  So here's what's driving the price.  Let's say you want to buy Golem, it's not offered on Coinbase, you need to first get an account at Bittrex or Cryptopia which are only fundable in Crypto.  That means if you are not a hacker or computer expert, you need to first connect your Coinbase account to your bank account at Wells or BOFA and then buy BTC paying the egregious 7% fee (which ironically is similar to an FX transaction).  Then, and only then, you can fund your Bittrex with BTC and buy XRP or whatever.  So this is driving the price of BTC higher, as there is precious little supply of BTC.  We call this in FX 'real money flows' - as DB noted recently, Japanese men have become 'crypto day traders' - but the real upward pressure is by using BTC as a base/funding currency, which is only beginning.  Crypto exchanges are experiencing huge bottlenecks, which means this squeeze has only started.  This week the price of BTC/USD can run up 100% or more due to this demand.  

That means, millions of people investing thousands of dollars, is driving the price of BTC up, and will likely continue to do so, until there are viable alternatives, which there will be.  Currently BTC is really the only choice for many - although it is slow, inefficient, and feature poor.

Comments

Citxmech TeamDepends Sun, 12/17/2017 - 19:47 Permalink

The thing is, you don't have to buy BTC to load up on your day-trading crypto picks on an exchange.  You're better off buying ETH or LTC.I think BTC is the "name brand" in the space and is pushing the entire market for now.  Over the next year or two, we'll probably learn which of the new players offers functionality that folks will actually pay to use.

In reply to by TeamDepends

Monkeymitts Citxmech Sun, 12/17/2017 - 20:26 Permalink

Every generation has an irrational collectible. In the 1970's people spent thousands of pounds on stamps because they believed they would keep going up now you can buy collections for cents on a dollar of face value and at least people still buy them to use them for postage. It also didn't really cost much to store them for 50 years. The Bitcoin fad, given that Bitcoin is already an obsolete blockchain may last two more years.

In reply to by Citxmech

bunkers Sun, 12/17/2017 - 10:05 Permalink

Ordinarily, the awake would panic into gold, silver, etc but these are not ordinary times so we have to panic into something, else. Cryotocurrencies are it until tptb stop manipulating gold, etc.My problem with Bitcoin is that we're exchanging fiat dollars for fiat Bitcoin.

thebigunit To Infinity An… Sun, 12/17/2017 - 13:23 Permalink

I think you have cracked the code.

Whick Bitcoin are you talking about. There's 3 now and soon Bitcoin Diamond?  Bahaha ..They can duplicate this shit by a thousand. 

Gold is a commodity, but a gold coin is money.Commodities and money are closely related, but different.Silver, platinum, and palladium are not money but they are alternatives to gold (and gold coins).If bitcoin as analogous to a gold coin (i.e. money), then bitcoin cash, bitcoin diamond, etherium, etc. etc. etcs. are analogous to precious metal commodities and are "near money", and COULD become money.As Infinity points out, there's not much in the way of a flood of new cryptocurrencies, some of which will qualify as "near money", and a few will likely make it to the stature of "real crypto money".There may be a limit on the number of bitcoins, but  in the crypto world there is no limit on the number of bitcoin alternatives.

In reply to by To Infinity An…

DC Beastie Boy To Infinity An… Sun, 12/17/2017 - 14:16 Permalink

Here’s a short list of BTC clones, forks and others just using the name.

It’s hyperinflation like the universe has never known

Bitcoin BTC
Bitcoin Cash BCH
Bitcoin Gold GLD
Bitcoin Connect BCC
Bitcoin Diamond
Bitcoin Plus
Super Bitcoin
Bitcoin Ultimate
BitcoinX BCX
Bitcoin Dark BTCD
Bitcloud BTDX
Bitcore BTX
First Bitcoin BIT
Bitcoin Red
Bitcoin Fast
eBitcoin
Bitcoin Scrypt
BitcoinZ
BTC Talk
BTC Moon

In reply to by To Infinity An…

HRClinton DC Beastie Boy Mon, 12/18/2017 - 13:59 Permalink

That's not hyperinflation. It's forking leakage.With hyperinflation of a currency, the supply increases butts so users have no alternative to use anything else. They cannot Escape. Unless they go to a different currency.Forking is completely different. A portion splits off, with some initial followers and the hopes that more will join their 'superior' system.If you're not knowledgeable enough, I'm not going to bother   to spoon-feed you the info.

In reply to by DC Beastie Boy

AnarchistRex To Infinity An… Mon, 12/18/2017 - 01:13 Permalink

For those who do not understand forking and think that it is 'counterfeiting' ... it is NOT like counterfeiting AT ALL ... because the relative value owned by all investors REMAINS CONSTANT ... counterfeiting on the other hand causes an imbalance in the relative ownership, with the counterfeiters owning more and more of a percentage of the total as the counterfeiting continues.New versions are effectively only increasing the decimal place of the overall pool - effectively it is still a limited quantity of VALUE.  And hence NON-INFLATIONARY.  Simple math really, but so many people just think intuitively, instead of step by step logically and they just don't get math and miss the boat.Quite different from fiat/bankster funny money which is counterfeited.

In reply to by To Infinity An…

HRClinton maxblockm Mon, 12/18/2017 - 13:25 Permalink

I too have some heartburn with the term intrinsic value.Value is the relationship between the Performance and Price of an item or service:   Value = Performance / PriceHow this applies to gold at this stage is unclear at best. A low price gives it high value? LOL. People -- even those who should know better -- play fast and loose with diction. Sloppy!What gold does have, is Utility, given its Properties and Supply:    U = P / SThe higher the Properties and the smaller the Supply, the greater its Utility as Currency.

In reply to by maxblockm

flyonmywall Sun, 12/17/2017 - 11:02 Permalink

Yep. It only took them 5 months to catch up to the real world....Mr. and Mrs. Watanabe have nothing else to invest in that will give them any real hope of any real returns, except cypto.Hold on for dear life, it is about to get very interesting once Mc. Shitstain gives the thumbs down on the tax "cut". Hope you are hedged accordingly. 

PumpherDumper Sun, 12/17/2017 - 11:02 Permalink

It is infinitely more smart to buy Litecoin from Coinbase, more correctly, GDAX, then transfer to the exchange that is selling the crypto of your choice.  The time needed for a Litecoin purchase is much, much faster.  I know, next week he'll come out here and use the same reasoning for why LTC is soaring.  /sWhat the author doesn't address is the fact that most people purchasing BTC are NOT using BTC as he describes.  It is going straight into cold storage for the future.  The story is not just about demand, it is about supply, too.

ZH Snob PumpherDumper Sun, 12/17/2017 - 12:06 Permalink

agreed.  anywhere you see BTC you will see LTC as the better way to go.  anywhere but investing...for now.   BTC is absolutely going into cold storage, while LTC is the worker.  this is a great symbiosis, and as the public becomes more educated about it, the value and price of LTC will continue its rise.I tried to lay this out for ZHers on another thread and was soundly down-voted.  couldn't care less about the votes, but when LTC goes 10 or 20 times its present value next year the same mockers will bitch about that too.

In reply to by PumpherDumper

Jay PumpherDumper Sun, 12/17/2017 - 12:16 Permalink

LTC fees are 2 orders of magnitude lower than BTC and the confirmations much quicker. You can swap it with other altcoins at bittrex just as easily as BTC. Plus there are the benefits of not being part of the big block/ small block war and the struggle for miners between BCH and BTC. LTC works today the way BTC promises to work someday.

In reply to by PumpherDumper

Endgame Napoleon PumpherDumper Sun, 12/17/2017 - 12:20 Permalink

Since you have to provide your bank information, I do not see how they are getting so many people to do this. With PayPal, you just give an email address, but it does not sound like you can do as many things with the Bitcoin yet if you choose that route. Maybe, if you are not affluent, you could just buy it in tiny amounts and store it in PayPal. Maybe, people go to the bank and set it up, which might seem more secure than putting info. on a site.

Unclear:

https://support.coinbase.com/customer/en/portal/articles/1404398-what-i…-

In reply to by PumpherDumper

roddy6667 PumpherDumper Mon, 12/18/2017 - 04:21 Permalink

"7% doesn't bug me at all with these returns! "Reminds me of another get-rich-quick MLM scam, Primerica. They would tell prospective customers that they had such a good deal that "interest rates don't matter". They did get in trouble for that eventually. Most of these scams target the financially illiterate.Nothing new here.When you have seen as many scams as I have, you notice they all smell the same. 

In reply to by PumpherDumper