Why has Bitcoin surged in price by over $1,200 in a week to $6,900?

Bitcoin on the 4th May was trading $5,600, what has caused it to surge to $6,900 in just one week? In weekly gains not seen since the bull market of 2017, we take a look at some of the reasons why it’s rocketing in price.

1. The Golden Cross

A forerunner to this past week’s bull run was the “Golden Cross”. This is classified as when the 200 and 50 day moving averages cross, with the 50 day crossing above the 200 day, demonstrating a sustained change of direction for the markets. This happened on the 22nd April.

2. Fidelity Investments report suggests institutional money is coming

Fidelity, which hosts a digital assets division, ran a survey to find out how pensions, family offices, hedge funds, endowments and foundations feel about owning cryptocurrencies.

The survey found that 47 percent of institutional investors said digital assets are worth investing in, and the same percentage said they appreciate crypto for being innovative.

Just as important is the fact that 46 percent of respondents like the low correlation between cryptocurrencies and other asset classes. This proves that cryptocurrencies are the perfect hedge, and a good asset class to include in a diverse portfolio of investments. Does this mean institutional money is coming?

3. Facebook’s Project Libra

Recent reports say Facebook is actively recruiting allies to support its under-construction cryptocurrency-based payments system. Internally dubbed ‘Project Libra’, the blockchain-powered initiative will reportedly feature a U.S. dollar-collateralised stablecoin. Visa and Mastercard are rumoured to be supporting the initiative and the Wall Street Journal even suggests Facebook might reward users with fractions of the stablecoin in exchange for viewing advertisements or even by simply using the social platform.

Backing up this news was a softening of rules regarding crypto ads on Facebook. It doesn’t get much more mainstream than Facebook, if the company gets behind crypto in a big way it could open the door to retail investors again.

4. New Cryptocurrency-based ETF Filed with US SEC

The US Securities and Exchange Commission (SEC) received another application for a cryptocurrency-based exchange traded fund (ETF). Submitted on May 9, 2019, the latest crypto ETF application was prepared by Crescent Crypto Index Services LLC.

The SEC postponed its decision on whether to approve ETF applications filed by both VanEck/SolidX and Bitwise Asset Management – there’s a definite sense that they cannot postpone these applications indefinitely, and ETFs open the door to institutional investment.

5. The Consensus Conference Bull Run

It notably didn’t happen last year, but the big conference of the year – Consensus New York – begins in a few days and it brings a feel-good factor with it as the movers and shakers get together to debate the issues of the day.