Spike in bitcoin price sees 400 point leap from day lows

Bitcoin spiked higher today, 2 JulyBitcoin spiked higher today, 2 July

Another spike in the bitcoin price, and on similar volumes witnessed in the previous 500 point leap seen late Friday, saw the crypto move ahead nearly $400 in the space of 15 minutes.

The bitcoin price has jumped from a session low of $6,275  to $6681, although has slipped back a little at the time of writing for a 5% gain. It these sharp spikes are to continue in the same vein as the past few days, then the price will be above $7,000 by 7 July. Bitcoin is pulling up the rest of the crypto market with it. EOS is 12% ahead at $8.93, Bitcoin Cash at $793 for a 9.2% gain, while NEO has rocked nearly 20% to $36.3

The price spike today, taken together with Friday’s sharp move, is unusual even by bitcoin standards.

With US regulator the Commodity Futures Trading Commission (CFTC) looking at bitcoin market manipulation and persistent claims about Tether being used for manipulative purposes, the latest spurt is likely to attract their attention.

Following a report by Bloomberg reporters who pointed to what they considered to be abnormal movements in the Tether price on the Kraken exchange, something of a flame war has broken out. Kraken has defended its markets and responded by making accusations of its own, claiming that the Bloomberg story appeared just before the end of trading on the July bitcoin futures contract on 29 June.

The Bloomberg investigation shows two charts of bitcoin and Tether price movements. In the case of bitcoin price changes are reflected in the volumes, while no such correlation exists with Tether on Kraken’s markets. The distribution of trading patterns on Kraken’s Tether market shows a concentration of unusually large trades in contrast to bitcoin’s more even distribution.

The Bloomberg reporters say they found no evidence that Kraken was manipulating the markets: “No evidence that Kraken itself is involved in any manipulation has emerged”. However, it did also highlight the Kraken chief executive Jesse Powell’s dismissal of the need for regulatory oversight. In a blog “Krakenfx” sticks it to Bloomberg, with incendiary gusto:

It’s scary to think that our lawmakers are reading this stuff. The title sure was sensational, and it undoubtedly grabbed eyeballs but what of the readers who are not following the outrage on Reddit and Twitter? What of those who rely on the journalistic integrity and expertise of their news sources? If we are to take up our pitchforks against market manipulation, guide your torches toward this illumination: the Bloomberg News piece was published on June 29th, the last business day of trading for Q2, and expiration date of numerous futures contracts.

Other factors that may be helping the bitcoin price may be that start of trading in the new futures contract with buyers seeing less risk in going long from here. Also, miners may be entering the market to bolster the price.

The $50,000 price target from BitMex founder Arthur Hayes may have helped spike the markets with some bullishness, although his target was predicated on a bitcoin exchange traded fund (ETF) being approved, and there is no sign of that just year, although ETF providers VanEck has resubmitted a reworked offering that is being considered by the Securities and Exchange Commission.

About the Author

Gary McFarlane
Gary has been writing about cryptocurrencies since 2013 and currently works as the cryptocurrency analyst at interactive investor, the UK's second-largest online investment platform. Gary contributes for Coin Intelligence News in a personal capacity and none of his commentary should be considered investment advice. Gary is the winner of the ADVFN International Financial Awards 2018 Cryptocurrency Writer of the Year. Contact Gary on twitter at: @gary_mcfarlane

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