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Bitcoin Goes Through The Roof After CME Plans Bitcoin Futures

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Bitcoin Goes Through The Roof After CME Plans Bitcoin Futures
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The breathtaking rally in bitcoin continues unabated, with the most popular among a myriad of cryptocurrencies hitting a fresh high of $6,600.84 Wednesday.

The trigger for the most recent record run is indication from the CME Group Inc (NASDAQ: CME) that it would launch bitcoin futures in the fourth quarter.

The bitcoin is currently trading up about 1 percent at $6,510.66.

The gains have catapulted bitcoin's market cap to a record $108.83 billion, with the total market cap of all cryptocurrencies combined together also at a record $183.59 billion, according to Coinmarketcap.com.

Putting things in perspective, the combined market cap of all digital currencies have now exceeded the market cap of Goldman Sachs Group Inc (NYSE: GS) and Morgan Stanley (NYSE: MS) put together, according to Reuters.

See also: Cryptocurrency Mining: What It Is, How It Works And Who's Making Money Off It

Created in 2009, bitcoin did not trade in any exchange in 2009, giving it a technical value of zero in the year of its inception. In 2010, when it began trading on exchanges, the highest value recorded was 39 cents. Given the $6,600, plus, value at which bitcoin is trading now, early investors, if they would have held onto their investment, would have pocketed staggering gains.

bitcoin.png Source: Coindesk.com

The surge in the valuation of cryptocurrencies should now keep skeptics, especially among Wall Street firms, at bay. JPMorgan Chase & Co. (NYSE: JPM) CEO Jamie Dimon had expressed his displeasure with the digital currencies at multiple forums in the past.

Analysts are optimistic that the rally in bitcoin has a further leg to play out, with some predicting bitcoin to hit $7,000 in the next few days and soaring to $10,000 by the end of 2017.

However, a near-term correction is seen amid the Nov. 16 hard fork of SegWit2x, which would change the size of the blocks passed around the network and stored in the blockchain from 1 MB to 2 MB.

Meanwhile, gold coins and other related products are losing luster, the Wall Street Journal said quoting analysts. Sales of gold dealers fell by a mammoth 70 percent year-over-year, the report added. Also, the value of "American Eagles," a gold coin considered a proxy for physical gold, is at a decade low.

The culprit that robbed the sheen off gold is said to be cryptocurrencies, which have now become safe havens, supplanting gold, which has traditionally served as a safer bet in times of distress.

Bitcoin has "taken some of the dedicated interest in gold away from gold," the Journal said quoting Mohamed El-Erian, chief economic adviser at Allianz SE.

El-Erian had warned at a CME Group event in September that cryptocurrencies could pose a long-term threat to the precious metal.

Posted-In: Cryptocurrency News Wall Street Journal Commodities Forex Markets Movers Media Best of Benzinga

 

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