Bitcoin (BTC) pinballs from $14k to $12k to $13k amidst Coinbase outage
Bitcoin is treating speculators to another white-knuckle ride right about now.
Bitcoin enthusiasts are being treated to a hair-graying white-knuckle price ride as Bitcoin careens around.
At the price party, it basically ghosted US$10,000 late last week to shake hands with $11,000. Then yesterday it stormed past $12,000 to slap $13,000 in the face. And today, just as it introduced itself to $14,000, a Coinbase outage pulled the fire alarm and dumped cold water on everyone.
Bitcoin doing Bitcoin stuff
The outage was brief but corresponded tightly with a sharp market plunge. Since then, Bitcoin has been doing what analysts might describe as "Bitcoin stuff", which consists mostly of going up and down in price.
The main question on people's minds now is whether this rally is exhausted, or if people are going to keep throwing money at Bitcoin to make it dance. Exchange volumes are hitting their 2019 highs, so it sure looks like it.
It's a universal truth that these kinds of price rallies get more fragile the longer they go on, but it's worth noting that the markets managed to hang on in the $13,900 range for a few hours before snapping. So traders are definitely getting twitchy in the face of this rally, but they weren't immediately ditching in the $13,900 range.
The next step for markets right now is probably to eye a solid break back into $13,000. In recent days there's been a profound lack of resistance in the markets following breaks past each $1,000 increment, so there's a very real chance of Bitcoin very rapidly making its way back to near $14,000 if it cracks $13,000.
And while it could all come tumbling down easily enough, it's worth noting for the sake of perspective that if Bitcoin rises another 55% or so, it will take out its previous all time high. That sounds like a lot until you consider that Bitcoin is up almost 40% in the last week alone.
Sceptics point at relatively low interest in "Bitcoin" on Google Trends right now compared to late 2017 as a sign that retail FOMO isn't in to drive the markets yet, but the markets are probably still sufficiently illiquid that whales alone could drive that rally back to $20,000.
Plus, Google Trends is cool, but it's not the be all and end all of measuring public interest.
So, how about that Coinbase outage, eh?
Exchange outages were common in the late 2017 bull run, as a wave of traffic engulfed unprepared trading platforms. But these days exchanges are much better prepared, and it seems unlikely that Coinbase would get buried in that way.
The cause of the outage is not clear, but one conclusion conspiratorial minds can jump to without any evidence is that someone on the outside attacked Coinbase to try to bring it down and make bank on shorting the market.
It's not entirely outrageous.
In February 2018 someone went to quite sophisticated lengths to present a hoax cryptocurrency ban in China. They stole access to the email account of a People's Bank of China employee, and then used that email account to launch convincing press releases announcing a complete cryptocurrency ban. It's believed they faked the entire thing so they could profit from shorting the markets.
Of course, China subsequently pseudo-banned cryptocurrency anyway, so maybe those market manipulators were just a little bit ahead of their time.
Either way, Bitcoin is eyeing a crack at $13,000 at the time of writing.
Disclosure: The author holds BNB, BTC at the time of writing.