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Bitcoin Bounces Back: Up 60% From September Lows

Bitcoin Bounces Back: Up 60% From September Lows

in Bitcoin & Cryptocurrency published on 16, October 2017

Bitcoin prices have recovered strongly from September trading lows, bouncing 60% higher than the month’s floor price as investors prepare for the next hard fork.

Bitcoin was up to $4712 during trading, a full 60% higher than the September low of just over $2915, driven by comments from JP Morgan’s Jamie Dimon, who brandished the currency ‘a fraud’.

Likening the rise of bitcoin to the 17th century tulip bubble, Dimon’s comments were flatly rejected by analysts and industry insiders. Nevertheless, they were enough to panic investors, sending the price of the currency tumbling.

However, with consistently strong average price growth since, it seems as though bitcoin markets are firmly back in the ascendency.

The same can be seen in the markets for ether, the tokens traded on the ethereum blockchain. Ether is also up some 60% from its September lows, as part of a broader recovery in the core cryptocurrency markets.

Much of the rise can be attributed to the growing expectation of a further two hard forks, where the bitcoin blockchain splits to create new rival currencies. While traditionally this had been seen to have a destabilising effect on price, investors now view it as a chance to capitalise on new coins, in what some describe as a ‘free money’ scenario.

“If you own bitcoin prior to [the hard fork] then you own bitcoin and the new coins. So people are rotating from altcoins back into bitcoin,” according to Rob Viglione of ZenCash.

This has led to an expectation of further price rises through October and November, as the bitcoin blockchain prepares for the next hard fork to take hold.

The two upcoming forks have yet to win widespread support from the blockchain community. However, were they to come into effect, they would create two new forms of bitcoin currency, in the same way as Bitcoin Cash emerged from the previous hard fork on the blockchain.

Investors holding bitcoin during these hard forks receive an equivalent amount in the alternative currency, effectively increasing the total value of their holdings. On that basis, it looks like bitcoin prices are only set to increase in the weeks and months to come.