Bitcoin is making a comeback

(Photo by Marc Atkins / Getty Images)

Bitcoin was trading up 4.85% Monday morning after a bullish weekend for the largest digital currency by market capitalisation.

Bitcoin, which is known for its wild price swings, soared to $US6,646 after a $US200 pop around 9 a.m. ET, according to data from Markets Insider. That’s its highest price in nearly 10 days, as the coin has climbed from its recent bottom near $US5,900 hit on June 24.

Since the beginning of 2018, the market for digital currencies has been under pressure, hitting a year-low in market cap of close to $US230 billion on Friday. Autonomous NEXT, the financial-technology research firm, estimates recent market woes are tied to the market for initial-coin-offerings, the crypto-based fundraising mechanism.

“ICOs were the reason the crypto prices shot to the moon last year, and they are also (part of) the reason why we are now seeing a prolonged weak market,” the research group said in a note Monday morning.

Autonomous’ hypothesis suggests companies that raised funds at the end of 2018 for ICO projects are now selling off the ether they raised in order to pay employees.

Still, the market was making a roaring comeback Monday with ether up close to 4% at $US471 and bitcoin cash trading up 6.5% at $US786.

Pasted image 0eToro

Mati Greenspan, a senior market analyst at eToro, said in a note out Monday morning that crypto charts show “several positive progressions” for bitcoin.

“The most obvious is the break above the downward channel that we’ve been tracking,” Greenspan wrote.”The price has managed to sustain above $US6,250 all weekend but is yet to show if the breakout is real or false.”

He added, “The second is a double bottom that can be seen as the price reached the lowest price of the year ($US5,780) on two separate occasions (purple circles) but didn’t go any lower.”

Elsewhere, Coinbase announced Monday that its crypto-custody product went live. Coinbase custody aims to safeguard cryptocurrencies for institutional clients such as hedge funds, according to a blog post.

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