CALIFORNIA – The world’s largest cryptocurrency Bitcoin rose to an 18-month high on Wednesday with many crediting the rise to Facebook’s Libra introduction.
According to market analysts, the surge was caused by nervous traders looking for safety in alternative investments and expectations that Facebook’s Libra could turn cryptocurrencies mainstream.
Although it remains below its all-time high of nearly $20 000, Bitcoin has surged in value since April 2019 and was trading close to $13 000 on Wednesday and it is now up 240% since the start of the year.
According to Moneyweb, investors have flooded back into digital currencies following a bruising 2018 and that allowed Bitcoin to rise for eight consecutive days.
With Facebook having already announced that it would offer its own cryptocurrency, the Libra coin, by end of June 2020 the biggest cyrpto rrmains unaffected.
According to Michael Hewson of CMC Markets, he reckons that the social media giant’s announcement this month has revived interest in coins, while investors seeking safety have also pushed up bitcoin’s price.
“It obviously does appear to be benefiting from some sort of flows that gold is benefiting, too,” said Hewson.
“You’ve got all this stuff about Libra going on, which is renewing interest in bitcoin. Crypto is back in vogue,” he concluded.
On the other hand, with major central banks keeping interest rates near all-time lows, investors have been looking for ways to diversify their portfolios, including through cryptocurrencies, analysts say.
The website further reports that Bitcoin CME futures volumes have increased in the past few days as investors look for ways to get their hands on the coin via the derivatives market.
A look at the previous ratings, Bitcoin last traded at $12,430 on the Bitstamp exchange after reaching a high of $12 935 earlier in the Asian session but the cryptocurrency has rocketed 150% since early May, along with big rises in other smaller digital currencies such as Ethereum’s ether and ripple’s XRP.