Earlier today, on October 12, CCN reported that the Bitcoin price had achieved a new all-time high at $5,150. Within the past few hours, the Bitcoin price has increased from $4,150 to $5,419, establishing a new all-time high again.
Since October 11, in a 24-hour span, the Bitcoin price surged from $4,750 to $5,384, recording a staggering 13.34 percent daily increase.
Three Major Factors of Bitcoin Price Surge
The recent price surge of Bitcoin can be attributed to three major factors: increase in demand from institutional investors, the rapid growth rate of the South Korean and Japanese Bitcoin markets, and the upcoming SegWit2x hard fork in November.
Earlier this week, in an interview with CNBC, billionaire hedge fund legend Mike Novogratz revealed that several large institutional investors have been preparing to engage in the Bitcoin and cryptocurrency markets. Novogratz stated that a rapidly increasing number of retail traders have started to consider investing in Bitcoin and including cryptocurrencies as a part of diversified portfolios.
“I can hear the herd coming. I was just in San Francisco, met with a few big institutional investors and their still a ways away but they’re coming. Lots of funds are being raised and so I’m pretty confident to say that it [Bitcoin price] is going higher.”
In addition to the increase in demand from institutional investors, leading Bitcoin markets including Japan and South Korea, which control over 65 percent of the global Bitcoin exchange market share, have demonstrated an increase in demand from local traders and investors.
Specifically, subsequent to the authorization of cryptocurrency exchanges as regulated financial service providers by the Japanese government, the demand for Bitcoin in both Japan and South Korea has increased significantly.
As Korbit founder and CEO Tony Lyu told Nathaniel Popper of the New York Times:
“Word just spreads really fast in Korea. Once people are invested, they want everyone else to join the party. There’s been this huge, almost a community movement around this.”
Yuzo Kano, the CEO of BitFlyer, Japan’s largest cryptocurrency exchange with over 800,000 active users, further emphasized that conservative Japanese investors are turning toward Bitcoin, which has become the norm in the Japanese market.
Due to the overwhelming demand for Bitcoin, South Korean and Japanese exchanges are processing Bitcoin trades at a premium rate. Korbit, the second largest cryptocurrency exchange in South Korea, has been facilitating Bitcoin trades with a premium of at least $100.
Since achieving its new all-time high at $5,419, the Bitcoin price has slightly corrected itself to $4,370. Still, in the South Korean Bitcoin exchange market, the Bitcoin price is being traded at above $5,500.
JPMorgan CEO Jamie Dimon Will No Longer Comment on Bitcoin, CFO Expresses Optimism
JPMorgan CEO Jamie Dimon, who has been harshly criticized by experts in the finance industry and cryptocurrency sector including prominent venture capitalist and the owner of Golden State Warriors Chamath Palihapitiya, CNBC analyst Brian Kelly, and former JPMorgan executive and head of global macro Alex Gurevich, stated at a conference call that he will no longer comment on Bitcoin.
“I wouldn’t put this high on the category of important things in the world. But I’m not going to talk about bitcoin anymore,” said Dimon during the bank’s third-quarter earnings call with media.
In late September, Dimon falsely described Bitcoin as a fraud, which prompted the criticism of highly regarded experts like Palihapitiya, who explained:
“Absolutely not [bitcoin is not a fraud]. It cannot be a fraud. What countries can constrain today is how it [bitcoin] is effectively traded but it cannot be controlled. It is a fundamentally distributed system that exists peer to peer. And so to the extent that you can basically eliminate the will and the actions of every single person in the world, you can eliminate it. But in the absence of that, the genie is fundamentally out of the bottle.”
JPMorgan CFO Marianne Lake further emphasized that the firm will remain open-minded towards the cryptocurrency market.
Featured image from Shutterstock.