Bitcoin hits another record high in march toward $20,000

Thursday, 14 December 2017 00:00 - - {{hitsCtrl.values.hits}}

New York (Reuters): Virtual currency bitcoin hit another all-time peak on Tuesday, two days after the launch of the first ever bitcoin futures on a U.S. exchange and ahead of the start of another futures contract next week, as investors grew optimistic that the $20,000-mark is within reach.

On Sunday, Chicago-based derivatives exchange Cboe Global Markets launched bitcoin futures, enabling investors to get exposure to the currency via a large, regulated exchange.

The CME Group is expected to launch its futures contract on Dec. 17.

“We’re going to see bitcoin emerge as a payment network,” said Trevor Koverko, chief executive officer of Polymath, a securities token platform.

“Currently bitcoin is being used as a speculative asset and store of value. But as scaling solutions...emerge, bitcoin’s utility dramatically increases along with its price,” Koverko said.

Bitcoin, the world’s biggest and best-known cryptocurrency, was quoted at $17,310 on the Luxembourg-based Bitstamp exchange, up 5.1% on the day. Earlier on Tuesday bitcoin hit a record high of $17,428.42, registering a roughly 20-fold increase in its price for the year as it drew in millions of new investors.

A Reuters technical analysis that measures the ups and downs in trading prices, known as waves, showed bullish momentum for bitcoin.

The technical analysis suggests an extension of a wave, which could mean that bitcoin would easily surge above the psychologically important level of $20,000, according to the Reuters analysis.

“It’s remarkable how back in November $10,000 seemed like a psychological end-of-year target,” said LukmanOtunuga, research analyst at FXTM. “With the current gravity-defying bullish momentum, it may be no surprise if bitcoin concludes 2017 on $20,000.”

But as bitcoin set a new record, digital currency exchange operators Coinbase and Bitfinex reported problems with service through their websites on Tuesday, frustrating traders seeking to cash in on the latest surge in the value of bitcoin and other cryptocurrencies.

The newly launched one-month bitcoin futures on the Cboe Futures Exchange were slightly tepid, with prices generally steady and volumes about a third of those seen on Monday. Bitcoin futures maturing in January XBTF8 were at $18,450, with just 1,416 contracts traded as of late afternoon in New York, compared with 3,956 contracts on the first day.

A total of $26.4 million was notionally traded so far on Tuesday, compared with around $73 million on Monay.