Is the current price boom in Bitcoin a pumping action?

The price of bitcoins released Tuesday reached $ 8,300 at Coinbase, its highest level since 2019, its highest level since July 2018.

This rise occurred as part of a long-term bull market that gained momentum, especially after April 2, 2019. The BTC / USD instrument rose 23% that day, which triggered a series of similar buying shares in April and the first half of the year. from May. The strengthening of the bullish bias helped Bitcoin to move beyond critical areas of resistance, such as those hiding around $ 6,000, $ 6,400 and $ 7,500. As a result, the world's first cryptocurrency had raised its net recoveries to 162% as of the publication date of this publication.

Artificial pump?

The speed with which bitcoin has grown has led many to call the "manipulated" movement. The crypto skeptic, David Gerard, wrote in his blog on Monday that the price of bitcoin was a "proxy for margin trading," adding that one could earn more money by manipulating crypto -money "lean and poorly regulated market to burn the traders of margins. "

New York-based Byrne & Storm partner Preston Byrne draws on Gerard's storyline. He wondered why each spike in bitcoin prices coincided with one or more major exchanges facing "banking problems, withdrawal and possibly solvency". BitFinex was in a difficult situation due to the management of $ 850 million of funds from its clients. An event of such magnitude could have brought down the bitcoin market. But on the contrary, the reverse has occurred because of potential price manipulation.

"This was the case with, for example, Mount. Gox in 2013, and some argued that this was also the case with Bitfinex in 2017 […] If you are a trader or investor, pay attention. It is possible that the current price of a Bitcoin has a connection with the evolution of regulation and that it is particularly vulnerable to it, "Byrne said.

Everyone seems to forget that when Bitfinex received the CFTC's subpoenas, the price increased by 40% in two days. The price of Bitcoin has finally doubled before collapsing.

This was not good news.

– Bitfinex 'ed (@Bitfinexed) May 10, 2019

Tether Pumping Bitcoin

Gerard reiterated that he did not believe that institutional investors were behind the soaring prices of bitcoin. Instead, the additional $ 800 million of Bitfinex, each in US dollars, has accumulated in the bitcoin market. Excerpts from Gérard's article:

"The attachments are dollar substitute tokens, each representing a $ 1 liability in the books of Tether, Inc., hypothecally payable on demand against a real dollar. The idea is that they are quite expensive – compare the Eurodollars on the real financial markets – but evolve at the speed of crypto. Tether is owned and managed by the same people as Bitfinex cryptochange.

"There is the minor detail that no one has already verifiably confirmed to be able to redeem a Tether for a dollar. "

The other bitcoin case

The last time Bitcoin broke $ 8,000:

Microsoft did not build on it.

Congress did not fight him.

Bakkt did not start with that.

Square did not sell it.

Fidelity did not store it.

TD Ameritrade did not trade it.

Whole Foods did not accept it.

– The Rhythm Trader (@Rhythmtrader) May 13, 2019

The rise in bitcoin prices has closely followed the disruption caused by the US-China trade war on world markets. The move comes after traditional financial companies such as Fidelity Investments, E * Trade Financials and TD Ameritrade announced new bitcoin trading services for institutional investors. Tom Jessop, Fidelity's Digital Asset Services Manager, told The Block that institutional interest in the bitcoin market has increased over the last 12 months.

"We just finished a survey of about 450 institutions," Jessop said, "everything from family offices to registered investment advisers to hedge funds. Interestingly, I think about 20% indicated that they are currently allocating to digital assets with the intention of developing them. "