Is Bitcoin waiting for a huge dump following the pump?

Highlights

• On 8 October, the Bitcoin prices have been well over US $55,000 and is currently trading at US $55,479.12 with a 24-hour volume of US $38,136,669,124.
• Bitcoin’s total market cap reaching US $2.33 trillion, an increase of 1.68% in just 24-hour period.

Bitcoin has been on a bull run for the past few days. As Bitcoin touched US $55,000 on 6 October, an elongated bull run is being predicted by the market participants. Even on 8 October, the Bitcoin prices have been well over US $55,000 and is currently trading at US $55,479.12 with a 24-hour volume of US $38,136,669,124. Bitcoin was up by 2.81% in the last 24 hours with a live market cap of US $1,045,112,817,817.

Historically though, October has been a good month for Bitcoin. It’s a month when the market moves upwards and hence the social media circles are quick to jump on the term ‘Uptober’ indicating that this is the month that Bitcoin along with other cryptocurrencies will see an upward trends. So far in 2021, the Bitcoin has registered a gain of 2.49% with another 22 days to go. Bitcoin’s total market cap reaching US $2.33 trillion, an increase of 1.68% in just 24-hour period.

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So, the big question that there on everyone’s mind is for how long can one expect the bull run to continue, or will it be a shortish run before it comes all crashing like the one witnessed in May?

Well again historically speaking, that’s very unlikely. Barring some untoward incident, it’s safe to assume that Bitcoin’s pump is here to stay.

Bitcoin surge

It all started on 30 September night, when United States Federal Reserve Chair Jerome Powell stated that the country has no intentions to ban cryptocurrencies. That surged the prices and pushed the prices further to US $48000 on 1 October. Then came the Bitcoin exchange-traded fund (ETF) approval by the US Securities and Exchange Commission, which was another important reason for the price pump. Following which Bitcoin broke into US $50000 for the first time in three months.

Also read: Uptober, Rektember: Why is it creating a buzz in crypto market?

Then came the Wall Street effect, when the big-ticket players started piling on Bitcoins which ensured that the Bitcoin break the US$55000 mark and has been steadily trading since then. November is also considered to be a green month for cryptocurrencies. Rarely do we have seen November month going bad from the cryptocurrencies.    

Many sceptics believe that market is flooded with whales doing rounds and not the actual investors. While people can see increase increasing volume. Experts believe that an estimated 38.2% Bitcoin supply has been lost in the recent rally. An estimated 92% of the supply hasn’t moved in last 30 days. Hence the BTC availably is scarce this could have a situation where the demand is there, but supply is less.

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What could cause the dump?

Investors who are looking to who are looking to earn some heavy profits could end up dumping the crypto onto the platform. Besides, scammers could take advantage of the positive price movements and could look to lure people to dump the prices to take advantage of the situation and would create a situation of a dump to cheat customers.

Another interesting development that could have an effect could be the Japan-based Mt. Gox’s recent insolvency case. The case has raised a lot of speculation that there could be potential Bitcoin recipients, who could well dump the world’s leading cryptocurrency on various exchanges thereby impacting the market. Mt. Gox, which was at one point world’s largest Bitcoin exchange had to file for bankruptcy following a series of hack. Approximately 850,000 Bitcoins disappeared, of which the company has managed to recover only 200,000 BTC.

The former exchange is expected to return the money to the investors who had incurred losses due to that either in the form of 2014 fiat currency prices or in the form of Bitcoin, assuming that the civil rehabilitation plan is passed, which is on October 8.

Experts around the globe have warned of major market shock should such a thing happen. Experts feel that the investors could dump bitcoins to earn profit, and this could lead to a price coming down severely.

All in all, pump and dump go hand in hand when it comes to Bitcoin.