Today’s contribution to the rally is unusual, as bitcoin prices have typically stabilized or dropped over the weekend for the past two years. Last Saturday prices did briefly dip, but Sunday saw a nearly $50 gain. While it is possible that prices are being manipulated by some very large buyers or trading bots, a likely alternative is that newfound demand in anticipation of Q3 announcements is causing buyers to keep an eye on bitcoin over the weekend.
The timing is interesting, as only two months ago bitcoin prices were in virtual freefall, scraping at the edge of $360. The last time prices were in the $630 range was in mid March, shortly after Mt.Gox filed for bankruptcy protection in Tokyo. While there are many, many factors involved in the current price recovery, a rebound to pre-Mt.Gox fiasco levels does have at least a symbolic resonance for many in the bitcoin community.
The current rally does seem to have had a powerful impact on the community, with several posts on sites like Reddit celebrating a return to overall profitability for bitcoin investors. Given the slow, painful decline bitcoin has seen since the December peak, a genuine and seemingly sustained upward trend has helped to shake the sense of fatalism often observed in over the last six months.
While there is no way to know how long the rally will continue, it is worth noting that both traditional banks, Wall Street investment firms, traditional ATM manufacturers and a host of mainstream businesses are all currently investigating how bitcoin’s nearly friction-free infrastructure might benefit their business models.