As always, the value of Bitcoin (BTC) rises and falls, and with it, media coverage. The cryptocurrency clawed its way into the public eye months ago when it reached an all-time high of around $ 250 per coin, then crashed hard and faded from view like it always has. Now, Bitcoin is back thanks to its recent ridiculous surge beyond $ 600 per coin, but what caused it to explode?
The cryptocurrency’s last surge, which saw it reach over $ 250 per coin, is what thrust it into the public eye. News outlets that previously either did not know of the currency’s existence, or did not take it seriously, began to take notice and include Bitcoin’s rise in the daily news cycle. A currency that you can obtain for “free” that had a 250-to-1 exchange rate quite easily grabbed the public’s attention. Then, like all currency eventually does, it crashed. The difference between what we would call standard currency and Bitcoin is that the highs and lows are experienced much faster, given the nature of the system — everything is much more dramatic. Inherent drama isn’t why a single Bitcoin was worth over $ 600 this weekend, though.
Bloomberg is reporting that today at 3PM EST Federal agencies are informing a US Senate committee that Bitcoin is a legitimate, viable currency. Last week, Bitcoin reached an all-time high of $ 400 per — a record that was broken just yesterday when it reached $ 500 per, despite a recent lull in the currency when the Silk Road, a Deep Web marketplace for illicit materials, was shut down. Bitcoin, as it’s an anonymous currency, was the marketplace’s favored form of payment. However, where the Silk Road was responsible for over one billion dollars worth of illegal drugs and services to be purchased with BTC, the closure of the marketplace might have had a positive effect on the currency’s value. Now, instead of being seen as a sketchy way to pay for illegal substances and services, Bitcoin can be seen as a more legitimate (legal) currency. The presentation to the US Senate would only make more people hop on the cryptocurrency train, as Bitcoin making it all the way to Washington can only make the currency more viable in the public’s eye.
Another reason for the explosion to $ 600 per coin is that a surge in Asia is partly responsible. A Bitcoin conference was held in Singapore last week, and speculation suggests that the subsequent coverage in the Chinese press is responsible for the massive surge. When you get a country with a population of one billion people on board, that’s sure to affect a currency. Another related factor could be that BTC China — the world’s largest volume Bitcoin exchange — received five million dollars in financing, further legitimizing Bitcoin in the public’s eye.
It remains to be seen if the recent surge past $ 600 will remain, but since its inception, Bitcoin’s nature is to dramatically rise and fall. Each new rise reaches greater heights, and each new fall seems like the abrupt end of a once-promising virtual currency that will actually stick this time around. It’s possible that the presentation to the US Senate will give the current value some staying power, but Bitcoin is still too volatile to trust at this point.