Bitcoin Soars Past US$7,000 Mark

Bitcoin has surpassed the US$7,000 mark, reaching a new all-time high of around US$7,350 on Bitstamp on Thursday.

Image credit: Close-up computer monitor with trading software, Bitcoin on dollar note visible on the background, g0d4ather, Shutterstock.com

The digital currency is up by over 620% this year after starting 2017 near US$1,000. At current prices, the total market capitalization is of about US$121 billion. But for Iqbal Gandham, eToro’s managing director for the UK, the run is far from over. “Despite another fork lurking just around the corner, we expect to see bitcoin hit new highs in the weeks ahead”, he said.

“Now part of the US$100 billion club, with a market cap bigger than Goldman Sachs, investors are increasingly confident in its future.”

Traders are speculating that this week’s bull run is partly helped by the coming Segwit2X hardfork, which is set to occur on November 16.

But bitcoin has also been boosted by news that leading derivatives marketplace CME Group is planning to launch bitcoin futures later this year, pending regulatory approvals.

Terry Duffy, the chairman and CEO of CME Group, said the company decided to introduce a bitcoin futures contract following “increasing client interest in the evolving cryptocurrency markets.”

“As the world’s largest regulated FX marketplace, CME Group is the natural home for this new vehicle that will provide investors with transparency, price discovery and risk transfer capabilities.”

Since November 2016, CME Group and Crypto Facilities Ltd. have calculated and published the BRR, which aggregates the trade flow of major bitcoin spot exchanges during a calculation window into the US dollar price of one bitcoin.

Bitstamp, GDAX, itBit and Kraken are the constituent exchanges that currently contribute the pricing data for calculating the BRR.

The move could help cryptocurrencies gain legitimacy in the financial world and bring more institutions investors into the market. It represents a major step forward in mainstream adoption.

“This is bitcoin crossing the divide from the wild west of finance to the mainstream”, Charles Hayter, CEO of Crypto Compare, told CNBC.

“Futures from an incumbent exchange bring bitcoin and cryptocurrencies into the regulatory fold. This allows more complex financial products to be created and will eventually open the doors to institutional money.”

Cryptocurrencies have grown to a US$190 billion market with bitcoin representing over 60% of that total. Ether, the second largest cryptocurrency, has gained over 3,500% to about US$300 since the start of the year.

In July, Bitcoin split into bitcoin and bitcoin cash. Bitcoin cash now has a market value of about US$9.3 billion and is the third largest cryptocurrency in the world.

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