Boosted By ‘Facebank,’ Bitcoin Surges Past $13,000, Reviving Memories Of Last Boom-And-Bust Cycle

Boosted By ‘Facebank,’ Bitcoin Surges Past $13,000, Reviving Memories Of Last Boom-And-Bust Cycle

Bitcoin surges
Pile of bitcoin keychains. Photo: BTC Keychain

Bitcoin is up 245 percent in 2019 so far, but it’s not all because of Facebook’s plans to launch a cryptocurrency called Libra and a digital wallet.

Bitcoin was already up nearly 200 percent before June 18 when “Facebank” made the Libra announcement, which initially sent bitcoin lower for the first few days before it recovered.

A new surge of interest in the U.S. took Wednesday’s bitcoin price above $13,000 for the first time since early 2018. In Asian trading, bitcoin rose as much as 10 percent. By mid-afternoon in New York, the one-day move was as much as 18 percent, with the price of bitcoin rising to $13,816, according to Bloomberg.

At this rate, bitcoin could bypass its current record within a few days,Financial Times reported.

Some thought Libra would be bad for bitcoin, especially since the goal for Libra is to “put the term ‘currency’ back in cryptocurrency” by being a coin for everyday use, according to Yahoo. Libra has big-name backers like Visa, MasterCard, PayPal, Stripe, Spotify, Uber, and Lyft on board as “founding members.”

It also has critics such as Rep. Maxine Waters, who called for a moratorium on Facebook’s Libra project until Congress can weigh in. “With the announcement that it plans to create a cryptocurrency, Facebook is continuing its unchecked expansion and extending its reach into the lives of its users,” Waters said in a statement. “The cryptocurrency market currently lacks a clear regulatory framework to provide strong protections for investors, consumers, and the economy.”

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Facebook said it will be using all the same verification and anti-fraud processes that banks and credit cards use, with automated systems “that will proactively monitor activity to detect and prevent fraudulent behavior.”

Facebook’s crypto push is partly helping push other cryptocurrencies higher but it’s not the main driver, according to Yahoo. The real reason bitcoin is moving higher in 2019 is growing signs of institutional interest, according to CME Group, which launched bitcoin futures trading in December 2017.

Ethereum, the No. 2 cryptocurrency, was up 13 percent on Wednesday and 150 percent for the year, according to Coindesk.

Bitcoin has struggled for legitimacy among traders since the last crypto boom-and-bust cycle at the end of 2017 which sent the price down 80 percent from its near-$20,000 high.