The price spike recorded Thursday on some exchanges reflects traders’ confidence that Wall Street may pour their funds into the cryptocurrency when bitcoin futures enter the scene, market analysts think.
The total value of bitcoins worldwide is estimated at $300 billion. By contrast, Goldman Sachs investment portfolio is valued at $90 billion.
Experts think that the surge in price was triggered by multiple factors. But the riskiest factor is the irrationality of people betting on something such speculative as the bitcoin. Bitcoin is being purchased worldwide by people who hope that other people will need the cryptocurrency even more in the future.
However, the astronomical gains can only herald a looming crash, experts believe. The currency’s average price is currently estimated at $14,953.
Banking Giants’ Entering the Market Likely Behind Bitcoin Price Surge
One more factor would be who is driving the surge in price. If the answer is the black market, things could get even more complicated. But most experts believe that the influence of such toxic entities is greatly limited.
Instead, the recent price spikes are caused by the enthusiasm over the entrance of hedge funds managers and top investors into the trading game. Large investors will be able to place a bet on bitcoin on the Chicago Board Options Exchange starting Sunday.
The Chicago Mercantile Exchange will also introduce the digital coin next week. The two exchanges are focused on future contracts for bitcoin, which will make the currency even more speculative.
Most banking giants have access to these exchanges so, theoretically, they could start trading bitcoins immediately. It remains unclear how popular the digital token will be among institutional investors.
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