From a low of $3072 after the double slap from the Chinese government banning ICO’s and Jamie Dimon’s calling bitcoin a fraud, bitcoin has been rising steadily since Friday afternoon, September 15. For almost a week bitcoin’s price was hovering between $4,300 and $4,400 but last night around 7 PM EST, the price starting climbing again. This morning bitcoin reached $4,500 and now sits at $4,560. That’s practically a 50% rise in price in 25 days. So, what’s going on?
Bitcoin commerce, that is, commercial payments for goods and services made with bitcoin, is still in its infancy. Most bitcoin transactions are probably made by speculators wishing to acquire bitcoin for its price appreciation potential rather than using it to purchase stuff. The price appreciation then is speculation, pure and simple.
The biggest driving force is Asia where bitcoin reached today’s U.S. $4,500 level in Korea in May. Japanese prices tend to be even higher. I haven’t heard from the Chinese yet but the fact that they are now going to issue cryptocurrency guidelines rather than outlaw it is very optimistic news. What happens from this point on is new territory.