Whats really driving the price of Bitcoin through the roof
Although Bitcoin is electronic and moves quickly, the real world doesn’t. Since Bitcoin (which is colloquially BTC/USD) has been in the news, millions have decided to put their own money into the Crypto world and press their luck. So here’s what’s driving the price. Let’s say you want to buy Golem, it’s not offered on Coinbase, you need to first get an account at Bittrex or Cryptopia which are only fundable in Crypto. That means if you are not a hacker or computer expert, you need to first connect your Coinbase account to your bank account at Wells or BOFA and then buy BTC paying the egregious 7% fee (which ironically is similar to an FX transaction). Then, and only then, you can fund your Bittrex with BTC and buy XRP or whatever. So this is driving the price of BTC higher, as there is precious little supply of BTC. We call this in FX ‘real money flows’ – as DB noted recently, Japanese men have become ‘crypto day traders’ – but the real upward pressure is by using BTC as a base/funding currency, which is only beginning. Crypto exchanges are experiencing huge bottlenecks, which means this squeeze has only started. This week the price of BTC/USD can run up 100% or more due to this demand.