- Bitcoin crosses $5,100 key resistance level, investors hoping for a huge price rally
- Speculations buzz social media and news websites calling
- Skeptics believe it is another bull-trap; ask not to read too much into the price spike
Predicting the next move of the cryptocurrency market is almost as hard as coming across haters of Tom Hanks. Bitcoin, the premier cryptocurrency was trading at roughly $4,200 on April 2, 2019, while today it’s trading over $5,100. This burst in price has fueled speculations whether this is, indeed, the start of another bull run for digital currencies.
While the latest price rally of bitcoin has created enough buzz in the cryptosphere, skeptics are still holding their ground and aren’t entirely sold on the idea of an incoming bull run, at least, not yet.
Media outlet Bloomberg suspects that the recent surge in price is nothing more than the result of preset algorithmic trades.
Quoting data market intelligence firm Flipside Crypto, Bloomberg posits that a large number of inactive bitcoin wallets suddenly woke up from their sleep in the past two weeks.
In the below graph, it can be inferred that there’s has been a steep decline in the number of inactive bitcoins from about 8 million to less than 2 million.
(Source: Flipside Crypto)
Further, the news site also notes that most often, such dramatic price swings are a result of increased trading from the so-called bitcoin “whales.” Whales, in cryptocurrency terminology, refer to people or institutions with substantially large bitcoin holdings.
Flipside co-founder and Chief Executive Officer Dave Balter said:
“We see this move much more valid than a few whale moves in October. This probably signifies a change in perception or confidence in this asset class.”
Speculations Run Rife
As previously reported by Blockchain Reporter, a Reuters report states that a massive bulk order worth $100 million of bitcoin might actually be the event that caused the spike in the digital asset’s price. According to the report, an unknown buyer recently purchased bitcoin worth almost $100 million from exchanges such as Coinbase, Bitstamp, and Kraken.
With that said, investors should practice caution and perform due diligence before being lured by the recent price behavior.