Digital Currency Revolution Series: Two Driving Forces That Take-off Bitcoin Prices Towards $10k

Bitcoin price (at Coinbase) has surged more than 42% from the last 4-5 days and flirted with $10k level over the last weekend (refer above chart).

After break out of prolonged range-bounded trend, the pioneer cryptocurrency has finally closed above $9k mark 4th consecutive days in a row. 

Technically, we traced out hammer and bullish engulfing pattern candles at 7,515 and 7,630 levels respectively, consequently, you could see gap-up formation on CME Bitcoin Futures price chart which was expected to fill-in as shooting star hampers buying momentum as expected.

We believe nothing moves without an underlying factor, such bullish price is factored in by key news. Firstly, the Chinese President’s commentaries, and the second one is that the mounting interests in Bakkt’s Futures volumes. The duos are driving the bitcoin’s upward price movement.

Some analysts have emphasized on the Chinese Prime Minister Xi Jingping’s statements last week. He called for China to boost its adoption of blockchain, and to increase its use within China’s government, industry, and technology sectors. Consequently, the statement seemed to have stimulated the constructive speculation amongst crypto market participants 

Quite a few analysts are even suggesting the Chinese government is planning to accumulate Bitcoin, and others expecting a wave of new investment into Chinese blockchain companies.

Commentators have pointed out that President Xi’s comments referred specifically to blockchain technology - there was no mention of Chinese government interest in public blockchains like Bitcoin. This implies that the move was primarily driven by trader speculation as opposed to fundamentally led investors. It appears that it wasn’t only the Chinese news event driving the bullish price activity. 

On the flip side, Bakkt’s physically-settled bitcoin futures contracts have been steadily gaining interest as the market has seen a few new records since launching. Bakkt futures market hit an all-time volume high. During the course of this time, over US$ 300 million in Bitcoin short contracts were liquidated on Bitmex. This indicates a cascading price effect on crypto derivatives markets, and a strong short squeeze as short-sellers were forced to cover their positions. 

There were sources of news to divulge it had conducted its first block trade while also seeing a 796% jump in futures trade volume in a one intra-day trading session. A little more than a week later, Bakkt contracts reached another milestone with 640 BTC swapped on October 23. Courtesy: Bakkt & BNC