The price moved mostly sideways during the month. The exceptions were two sharp shifts with a large spike in volume, where a mouseover on Cointelegraph's original chart generates crosshairs that pinpoint the action to six hour time ranges:-
- 10 Oct between 1800 & 2400 (=0000 11 Oct)
- 15 Oct between 0000 & 0600
Cointelegraph's Analysis category had no articles to explain these movements.
Could the other news and analysis services explain the sharp shifts? The first of the events, a drop, had a straightforward explanation, which damages bitcoin's reputation as a 'safe haven' for money.
- 2018-10-11: Bitcoin slumps more than 5%, puts ‘digital gold’ status in jeopardy (marketwatch.com) • 'Bitcoin prices on Thursday finally broke out of a recent lull, dropping as much as 6% [...] The decline comes on the heels of one of the worst sessions for global equities in 2018, putting bitcoin’s “digital gold” status in jeopardy. Bitcoin proponents have argued that the cryptocurrency would be a haven in times of turmoil, just like gold, and go up in value.'
The subsequent rebound was less straightforward. I chose another story from MarketWatch.
- 2018-10-15: Bitcoin jumps after credit scare; Fidelity enters crypto sphere - MarketWatch (marketwatch.com):- • 'Bitcoin rose sharply Monday after a credit scare on a major cryptocurrency exchange created a rush for the No. 1 digital currency. [...] The move higher in bitcoin came at the expense of Tether (USDT), the stablecoin on the Bitfinex exchange, which traded to 88 cents. A stablecoin traditionally trades at or very close to $1 as it is a U.S. dollar backed coin that investors use to trade between different cryptocurrencies as opposed to going in and out of fiat.'
Tether the stablecoin? Sounds like an exercise involving horses. In fact, my '2018-10 Price' post gave a similar explanation -- 'Stable coin Tether is being cited as one of the main reasons for the spurt in crypto prices' -- although I failed to understand its meaning at the time. Here's another story from a reputable source.
- 2018-10-15: Bitcoin Has Leapt Sharply Higher -- Here's Why (forbes.com):- • 'Bitcoin, which just last week had its first major sell-off in months, has this morning jumped almost 10% [...] The sudden rise in the bitcoin price this morning was signaled by a sell-off of the dollar-linked tether digital coin — the only cryptocurrency which is down today, according to CoinMarketCap data. Traders often sell tether to buy other cryptocurrencies and a sudden influx of tether sellers would push down the tether price — and boost the bitcoin price if that's what traders are moving their money to. Tether was down by some 3% in the run up to bitcoin's sudden price rise.'
This sounds suspiciously like the cart leading the horse. The phrase 'signaled by' doesn't necessarily imply a cause-effect relationship. It could be a side-effect, like smoke rising from a fire. As long as I'm on animal analogies, whales also received some attention. Here's another analysis from MarketWatch.
- 2018-10-18: Bitcoin whales aren’t responsible for volatility, research firm finds:- (marketwatch.com) • 'The bitcoin whales are back. At least, that’s the conventional narrative that takes hold when the world’s largest cryptocurrency exhibits significant price swings, often over a short period. However, new data from Chainalysis, a blockchain research firm that specializes in detecting fraud and money laundering, suggest this isn’t to be the case. In fact, it is quite the opposite.'
The following chart shows four categories of whale, one of which is 'Lost'.
The last day of October marked a significant milestone in the bitcoin saga.
- 2018-10-31: Factbox: Ten years of bitcoin (reuters.com) • 'Bitcoin, the world’s first and most famous cryptocurrency, celebrates its tenth birthday on Wednesday [31 October].'
The 31st of October is also known as Halloween. How's that for a scary coincidence?
