Bitcoin hit $9,300, its highest level in 13 months

Bitcoin hit $9,300, its highest level in 13 months
Source: CNN.COM
Date: 18-06-2019 Time: 09:06:49:am

Bitcoin's stunning spring continues: It soared past $9,300 Monday, reaching its highest level in 13 months.

The cryptocurrency has risen 148% in 2019.

Many investors are betting on more growth ahead. As JPMorgan (JPM), Fidelity and the New York Stock Exchange get into the cryptocurrency business, investors have grown to trust bitcoin more as an asset for growth in their portfolios, says Kirill Bensonoff, CEO of OpenLTV, a platform which offers cryptocurrency and fiat loans for real estate debt.

But as the price continues to rise, "we may see more corrections ahead," Bensonoff said.

Some bitcoin watchers anticipate the price could exceed $13,500 this year — eventually hitting an all-time high of $30,000 this year, bets Jehan Chu, co-founder and managing partner at Kenetic, a blockchain platform.

Chu owns bitcoin and has repeatedly told media he anticipates bitcoin will rise to $30,000 in between steep rises and valleys. He said that low supply and increased demand, plus potential investment from established companies like Google and Apple, will fuel a price upswing.

But others remain skeptical bitcoin's growth will last, especially after its stunning rise to just under $20,000 and its subsequent plummet.

"Technically, we're actually still in a bear market unless we see prices soar well above $11,000," said Lars Seier Christensen, chairman of Concordium, a business blockchain network, "With this highly volatile and thin [volume] market, it doesn't take much to push the price up or down by a thousand dollars."

Facebook (FB) has been rumored to be preparing to announce its own cryptocurrency, which is helping drive bitcoin's price higher, Bensonoff and Christensen say.

Christensen said that his "trading instinct" tells him to short bitcoin if it rises above $10,000 instead of going all in. He has sold off bitcoin in the past, and currently doesn't own any bitcoin, although he invests into cryptocurrency funds that include various coins and blockchain projects related to the space.

"I don't think bitcoin is well suited for short-term trading," he said. "I generally prefer to trade in traditional fiat currencies.... If bitcoin moves into the $10,000 to $11,000 area, I would be more comfortable shorting it than buying it right now."

Bitcoin may be becoming mainstream, but it remains a volatile asset that's not suited for investors with low appetite for risk.

"While the rise in the price of bitcoin might initially be good news for investors, they must also consider the high volatility risk and inevitable price plunges that could follow," said Matt Branton, chief technology officer of Neutral, a cryptocurrency that serves as a basket of five other cryptocurrencies.

The last time bitcoin went down this road two academics at the University of Texas at Austin studied the market and found evidence that its price had been manipulated higher during its massive 2017 run-up. That shadow continues to loom over bitcoin.

"These wild fluctuations in Bitcoin prices are not the sign of an efficient market, but consistent with the telltale signs of rampant price manipulation," said John Griffin, a finance professor at the University of Texas at Austin and one of the two academics who wrote that paper. "Despite some time passing and though the mechanism may differ slightly, the same crypto trading forces alive in late 2017 are still present today."