Bitcoin is, once again, smashing records with the cryptocurrency having surged past $12 thousand on Wednesday. While the rise will reassure traders once again of the cryptocurrency’s value, many are still worried about a potential bubble burst.
Bitcoin racked 4.48 percent at $12,200.40 on the Bitstamp exchange after which it made its way to $12,276.00.
On Friday, the main US derivatives regulator announced it would allow CME Group Inc and CBOE Global Markets to list bitcoin futures contracts, which contributed to the recent cryptocurrency boost.
Bitcoin futures contracts will allow traders to buy or sell the cryptocurrency at a predetermined price at a later date. The move is believed by some, to be the starting point of a future financial crisis similar to that of 2008. Others, however, think futures contracts will control the unstable nature of the cryptocurrency.
According to cryptocurrency ranker, CoinMarketCap, the combined market capitalization of all digital currencies values at around $370 billion. As of now, the cryptocurrency market has surpassed JPMorgan’s value which currently sits at $366.8 billion. The bank’s CEO, Jamie Dimon has frequently criticized bitcoin, calling it a „fraud” and that it will eventually fade away. While bitcoin has lifted the market instead, there are lots of analysts who say it’s only a matter of time until the cryptocurrency bubble will burst. Another high-profile bitcoin critic is Nobel Prize-winning economist, Joseph Stiglitz who thinks the digital currency should be made illegal.
„We are in the throes of a bubble market, and one of the characteristics of a bubble market is that there is no way to know when the bubble will burst,” said Mick McCarthy, CMC Market’s chief market strategist in Sydney.
Leonhard Weese, president of the Hong Kong-based Bitcoin Association, states that bitcoin’s market value increase stems from „fear of missing out” and „greed.”
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