The global average bitcoin price crossed the $10,000 threshold on Tuesday after Korean traders bid the flagship cryptocurrency up to double-digit premiums.
Well, that was certainly quick.
Less than two days after reaching the $9,000 mark, the global average bitcoin price has pierced the five-figure barrier, rising to a new all-time high of $10,069, according to CoinMarketCap.
Though seemingly a psychologically-significant barrier, the bitcoin price cruised through $10,000 with relative ease, a much different scenario than when it clawed past $5,000 earlier this year.
The rally has been almost single-handedly fueled by insatiable demand from Korean traders. At the time of writing, BTC/USD pairs were still trading near $9,900, and Western traders seemed hesitant to cross into five-figure territory. However, BTC/KRW was trading above $10,800 on both Bithumb — the second highest-volume bitcoin exchange — and Coinone, the seventh highest-volume exchange. At this rate, it is conceivable that BTC/KRW could crack the $11,000 mark before USD pairs see $10,000.
As reported yesterday, the parabolic price surge is likely tied to the impending launch of bitcoin futures on regulated U.S. derivatives exchange CME. However, it could also be linked to new buyers entering the market. During the weekend following the U.S. Thanksgiving holiday, the iOS app for Coinbase became the top trending search term in the App Store, indicating that a significant number of people are at least interested in onboarding into the bitcoin markets.
So where does bitcoin go from here? Billionaire hedge fund legend Mike Novogratz — a long-term bull who thinks the bitcoin price could reach $40,000 in 2018 — stated on CNBC that he would not be surprised if the markets undergo a short-term correction as the rally cools off and traders take profits.
Similarly, Brian Hoffman, project lead at OpenBazaar, wrote on Twitter that he believes many early investors have set $10,000 as their target to take profits. Erik Voorhees, CEO of cryptocurrency exchange service ShapeShift, advised investors with large holdings to take a portion of their profits and pay down their consumer debt — a sentiment that was echoed by several other industry observers.
In any case, it’s hard to imagine the markets sustaining such a rapid climb without some sort of pullback. Remember, bitcoin was valued at just $1,000 when the year began, so to see it sustain that large a climb in such a short time period would be unprecedented. However, bitcoin has made a habit of defying expectations this year, and — as many amateur investors have learned — perhaps it is best to not try to time the market.
Featured image from Shutterstock.
Last modified: May 20, 2020 9:22 PM UTC