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Bitcoin Holds Gains, Heads for the Best Week Since July

October 28, 2016 at 19:08 by Andriy Moraru

Bitcoin is on the rise, maintaining a level above $680 for the second day in row as demand for it increased following declines in the Chinese yuan. The digital currency is set to record its highest price against the US dollar since June 20 after having the best weekly performance in 4 months.

Markets speculate that further declines in the yuan are likely to happen as officials are allowing the exchange rate of the Chinese currency to take a negative route against the US dollar before the potential interest rate hike from Federal Reserve in December. One way Chinese investors are using to hedge against the yuan depreciation is to buy bitcoin due to capital regulations imposed by the People’s Bank of China.

Rising Chinese demand is forecasted to support bitcoin until it crosses $700 by the end of the year according to Gatecoin, a trading platform for the digital currency, with the yuan trading near its lowest level in 6 years. Political uncertainty in the USA is also affecting the currency as investors closely watch the nation’s presidential elections that will take place on November 8.

These factors are helping bitcoin traders overcome the mega-theft that hit Bitfinex with $66m of losses on August 3 when about 120,000 bitcoins simply disappeared in the second largest bitcoin exchange hack ever since Mt Gox lost $350m in 2014. Massive losses were inflected to Bitfinex clients and a very sharp decline in the currency’s price forced it down to $480.

Following a brief dip to $671 yesterday, bitcoin rose to $679.09 as of 18:57 GMT today after reaching as high as $682.89 earlier. It rose from $647.20 since last Monday, scoring a 6% weekly gain. The cryptocurrency did not touch rates higher than $680 since July 4.

If you have any questions and comments on bitcoin today, use the form below to reply.

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