Bitcoin on Monday was mounting a comeback, continuing to rally off its mid-September low ptember as speculative purchases around the No. 1 cryptocurrency shifts into higher gear.
Where are crytocurrencies trading?
A single bitcoin was most recently trading at $4,712, up 2.2% on the day, but up around 60% since the world’s most prominent currency hit a recent low of $2,951.15, according to research and data site Coindesk.com. That nadir followed critical comments from Wall Street heavyweights, including J.P. Morgan Chase & Co.
Chief Executive Jamie DImon, who declared bitcoin “a fraud” that would “eventually blow up.” “It’s worse than tulip bulbs and won’t end well,” Dimon said, referring to the classic, 17th century asset bubble.
Ether tokens, trading on the Ethereum blockchain, meanwhile, were down about 5.2%, at $293. Ether tokens have risen about 25% since their mid-September retreat.
So far this year, Ether has soared more than 3,500% from around $8, while bitcoin has climbed 390%.
What’s driving cryptocurrency markets?
Cybercurrency participants say bitcoin has gotten a bump from expectations of two separate forks on the bitcoin blockchain that could create alternative versions of the core currency. Before, the prospects of such forks rattled the digital currency, dragging prices lower. However, traders are using it as an opportunity to sell alternative coins, including Ether, and buy bitcoin, expecting to receive the new currencies when expected splits in the currency occur later this month and in November.
What are digital-currency participants saying?
“If you own bitcoin prior to [hard fork] then you own bitcoin and the new coins. So people are rotate from altcoins back into bitcoin,” said Rob Viglione, co-founder of ZenCash, a privacy-oriented cryptocoin.
Bharath Rao, CEO of Leverj, a decentralized exchange for cryptocurrency derivatives, referred to the scenario as “free money” and said he expects the price of bitcoin to continue to rise into November as traders employ this rotation.
What is the fork in bitcoin?
A pair of controversial forks, not seen as gaining wide acceptance by the digital currency community are in the works.
In late October, so-called Bitcoin Gold designed to address challenges mining for bitcoin using computers to solve complex problems, will be launched.
In November, bitcoin will face a second version of Segregation Witness, or SegWit2x, which would create an alternative version of the bitcoin that would increase its so-called block size to 2 mega byes from the current 1MB.
If completed, those forks would create two additional versions of bitcoin, about two months after Bitcoin Cash erupted out of bitcoin back in early August.
Holders of bitcoin before those forks will receive an equivalent amount of the alternative coins after the so-called hard forks.