Why?
Don’t get me wrong I want Bitcoin to go into the $10,000 but we need to be realistic. What really caused the first bubble in december that took Bitcoin to $1000? According to Coindesk:
There is more speculation today that bitcoin’s November 2013 surge and Mt. Gox’s trading volume’s were built in part on fraudulent trading activity
To summarize the story about the MtGox Bot, it simply pumped the price of bitcoin by initiating huge buys on regular intervals. This caused the price of Bitcoin on MtGox to diverge from the other exchanges and seem alot more inflated. If you want to read how the Willy Bot was discovered and exposed you can read The Willy Report
What will happen
As a disclaimer the following will be pure speculation. We had quite a run up for Bitcoin, according to the following chart:
We see Bitcoin rose over $100 in the last week, however we had quite a dump today. This was most likely caused by the news of the Willy Report. Because now we understand that the first Bubble might have been fake, we can look at it two ways. The first more rational way is that because the first bubble never happened then maybe Bitcoin’s price is inflated and we are not going to go to the $10,000. However, the other more positive way to look at it is that maybe the first bubble never happened so we are still waiting for the true bubble of Bitcoin. Comment below about what you think, will Bitcoin experience another bubble but this time it will be huge, or are we not going to climb much farther and stay in the triple digits?
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