What is causing the Bitcoin bubble?

[stomachgrowls]

Now it is evident that Bitcoin price is at an all-time high. Prices have risen steeply, far too fast for my liking. I don't think such a growth is sustainable. The bubble is going to break very soon.

But what is causing such a price hype? I speculate this phenomenon is caused by the increase in the number of Bitcoin users. Hence, demand increases and supply dwindles. Thus price increases. Are there any other factors that could add to this price hype?

Commonly people will really answer about supply and demand because this is the common thing which do makes a certain price increase,when theres a demand then prices would go up and thats the thing is happening into bitcoin.Adoption is on the move which bitcoin is already been gradually being accepted by some countries already how much more on this upcoming august on which another country would decide to adopt bitcoin.Expect for the prices to increase even more on upcoming months.

[Przemax]

Its hard to say what is causing a bitcoin bubble.

The same thing I guess as with any other rapid price explosions .It happen to be the self fulfiling prophecies and a fear mongering of not using the option to make profits.

People are dazzled by emotions. Mostly people see others gaining money and they are getting terribly envious about their peers. And the greed grows in them to enourmous proportions.

Vuala. The recipe for the bubble - human sinful nature.

[pealr12]

The first thing that comes in everyones mind when somebody ask about why bitcoin price bubble is only the demand in bitcoin increases, many companies and countries accept bitcoin as another payment option, and holding it for a long time.

[aoluain]

I recon its a number of factors causing the Bitcoin Bubble,

The recent news articles relating to Japan, Australia, Russia and the U.K is all good
news and adds to the exposure, hype and excitement which in turn has to create new investors.

I also think existing crypto users are buying in possibly thinking that the value is
not going to fall and that its only going to rise, similar thinking prior to the quick down shift last month!

its all adding to the momentum . . .

[MyBTT]

There are numbers of factors related to this bubble I reckon,

1. The advancement of technology and digitalisation of everything
2. Japan accepting bitcoin.
3. The momentum of all of this.

I hope the bubble doesn't burst soon and we crypto users lose all our money, but I definitely think it will burst in the next 5-10 years.

[Yutikas_11920]

Actually this is indeed such a hype, but you need to know that the system in the bitcoin is very awesome and I'm sure in the future will be adopted or bitcoin technology used by all companies in the world. Indeed one of the factors that makes the price very high bitcoin is because of the growing number of requests to get the bitcoin, while stock available is absolutely not appropriate from the requests always come every second.
 

[mrfreezeh]

There are numbers of factors related to this bubble I reckon,

1. The advancement of technology and digitalisation of everything
2. Japan accepting bitcoin.
3. The momentum of all of this.

I hope the bubble doesn't burst soon and we crypto users lose all our money, but I definitely think it will burst in the next 5-10 years.

The value of Bitcoin will increase more, but not fast as now. One currency can't increase always, need time for down and wait good time for increase again. This bubble Bitcoin and Cryptocurrencies will breakdown, but I can't know when

[ktabb]

Now it is evident that Bitcoin price is at an all-time high. Prices have risen steeply, far too fast for my liking. I don't think such a growth is sustainable. The bubble is going to break very soon.

But what is causing such a price hype? I speculate this phenomenon is caused by the increase in the number of Bitcoin users. Hence, demand increases and supply dwindles. Thus price increases. Are there any other factors that could add to this price hype?

This is a good question. Most of the people here are so in denial that they won't even admit that this is a bubble, so it is refreshing to hear somebody who does recognize the reality of the situation.

The reason for the bubble is the nature of bitcoin investors. I wrote a post sort of related to this recently:

http://www.demoinvestor.com/articles/00000001
Organizations and fund managers on Wall Street have not begun to consider Bitcoin as a reasonable investment as far as risk versus reward goes, and rightfully so. Experienced investors prefer assets that either have a long history, or whose value can be measured by fundamental data about the asset. Bitcoin is severely lacking in both of these areas. As a result, the price is driven up and down by retail investors trying to get rich quick, who do not know how to invest. They fall into buying and selling frenzies far more easily than institutional investors would, which causes snowball effects to build up easily.

This basically describes what I believe is the reason. Bitcoin has historically consistently formed bubbles. This is because of the nature of bitcoin investors. They are retail investors who want to get rich quick. They are inexperienced and usually investing small amounts of money. They are basically just weaker hands who jump on board with buying and selling frenzies very easily.

If you read the article, you'll see that I mention a solution. The solution is that bitcoin needs to earn the trust of institutional investors. I am not sure that there is not a whole lot that can be done to achieve this other than wait.

[maku]

Now it is evident that Bitcoin price is at an all-time high. Prices have risen steeply, far too fast for my liking. I don't think such a growth is sustainable. The bubble is going to break very soon.

But what is causing such a price hype? I speculate this phenomenon is caused by the increase in the number of Bitcoin users. Hence, demand increases and supply dwindles. Thus price increases. Are there any other factors that could add to this price hype?

This is standard argument against bitcoin - the price of BTC has risen too fast, therefore it is no sustainable, and it must fall.
But as you said yourself - prices are high because number of bitcoin users is growing - this would indicate organic growth and not a bubble!
Bubble would mean totally artificial price spike - caused by actions of market speculators, whales and bots.
Scaling resolution is upon us, also Japan legal adoption happened, Australia will adopt BTC in July, Russians changed their anti-crypto stance etc.

[Kizaki]

Maybe in my own perspective the hype that we are currently seeing right now are caused by big countries adopted bitcoins as a mainstream payment.Big exchange are built on those countries which helps bitcoins price to pumps up

[Mia Wallace]

Now it is evident that Bitcoin price is at an all-time high. Prices have risen steeply, far too fast for my liking. I don't think such a growth is sustainable. The bubble is going to break very soon.

The notion of breaking bubble in a short time is heard for a long time and in the past nine months the price of bitcoin has always moved up and nothing happened and the price still keeps on moving higher,where is the bubble and when is it popping,we are seeing more people investing in bitcoin and so is the reason we are seeing higher valuation and not a simple bubble which can be broken altogether.

[ALWASA]

The first thing that comes in everyones mind when somebody ask about why bitcoin price bubble is only the demand in bitcoin increases, many companies and countries accept bitcoin as another payment option, and holding it for a long time.

i agree with you, thats what i am thinking also.
 there are so many companies already who accepts bitcoin and this will lead to the increase of the demand.
yet low supply because of the fact that some have bought and just plan to hold it.

[Viviyang]

Last time I read news that Japan have legalized bitcoins in their country,and most of the Japanese people love investing and most of their life savings are held in investments, so many Japanese people are interested in buying bitcoins and thus the Japanese exchanges also show this fact that there is a great demand for bitcoins in Japan, by watching the price chart of Japanese exchanges. Last time I checked there was a $100 difference between other exchanges and Japanese exchanges where bitcoin was trading very high and demand is still pretty much high.

[lionheart78]

Well I guess RSK have something to do with this increase, aside from that Bitcoin had been in a bullish position for months now.  The big company in Japang joining the bitcoin blockchain technology, and the upcoming Australia acceptance.  This probably hype Bitcoin and bring FOMO to new investors that result in this spike in price.

[Searing]

What is causing the bitcoin bubble you say?

1) people holding BTC

2) people adopting BTC

3) places where having BTC makes real sense (Venezuela, South Korea, Japan, India, China, etc etc)

As to frigging WHY all this is going on at the level that it seems to happening (perhaps FOMO) I've not a clue.

But if people are holding ..mined or otherwise....and more and more folk are adopting with 80% of coins already made...

and hyper adopting in some places due to the nature of their countries issues/plans/desires

well hell it is zoom, zoom time

All the above means it is fulfilling a need for those doing the above actions

but at the very least..it is like way, way more folk are coming on board and or holding at a rate that is unexpected by me

so heck....it is just a likely to hyberbolic as not ..especially if adoption ..or what do they call it 'market growth' continues

at this rate...hell...it is obvious it is providing some kinda relief to the countries mentioned above to boot

for all I know this very fact of NON gov't controlled currency is not its biggest draw now...as a store of value

so I wonder...what if even more come on board from word of mouth from these countries with like-minded issues and desires?

assuming btc and crypto offer some real relief...hell we could be at 5,000 usd BTC by next month at this rate

as a holder this is great thou the pucker factor at these prices is getting pretty intense

I'm out of ideas, no idea why it is happening as I guess above...but hard to ignore it is happing as we speak

boom or bust, chump or champ, we will be the first to know I guess...bubble it may be..but hell at this rate it may bubble to 8k and
fall back to 4k ...where it breaks is at anyone's guess right now

wild stuff

[2bfree]

I think it's stupid to asume it's a bubble how do you know? Maybe it is maybe it isn't. Maybe some big bank has 2 trillion sitting ready to pump into BTC if that was true then this IS NOT A BUBBLE so your statement is wrong. But maybe it is. I guess it bothers me that everyone is just statiing it as a fact that we are in a bubble when you damn don't know. Time will tell us if it pops then it's a bubble.

[Pamadar]

Well I guess RSK have something to do with this increase, aside from that Bitcoin had been in a bullish position for months now.  The big company in Japang joining the bitcoin blockchain technology, and the upcoming Australia acceptance.  This probably hype Bitcoin and bring FOMO to new investors that result in this spike in price.

Well for this newcomers are believing that this could be the break out japan and australia is a well established countries and with them joining this project many things will be expected. Just wanted to really make sure that this could go up and not just a hype always research and do your homework.

[Searing]

I think it's stupid to asume it's a bubble how do you know? Maybe it is maybe it isn't. Maybe some big bank has 2 trillion sitting ready to pump into BTC if that was true then this IS NOT A BUBBLE so your statement is wrong. But maybe it is. I guess it bothers me that everyone is just statiing it as a fact that we are in a bubble when you damn don't know. Time will tell us if it pops then it's a bubble.

Well to me there is good bubbles and bad bubbles....if it bubbles to 10k and drops to say 6k ...I can live with that

slow adoption and price would be best..but bitcoin does not seem to work that way it is all drama

so pump (bubble) to 10k and dump to 6k works....IF the fundamentals work ..and at 6K it resumes its climb steadily (non-bubble)

or balls to the wall (bubble) as a repeat....

crap can't go up forever.it can go up too fast and still recover and go up too fast again in this bubble like cycle

anyway just saying.....its a bubble in my view because of the speed it is going up ..but hell ..... when it busts are

the fundamentals good enough that however it dumps ..is it just to catch it breath and resume again

seems to be the pattern..I certainly don't see a bubble to 5k and then crash to 1k...but I am expecting if it did get to 5k
a crash to say 3.5k and btc being btc and loving sideways sit there for say 3-4 months between 3.5 and 4k while it
digests at this price..then start the merry go round again for the next great overshoot up and a repeat

btc seems to be how it works

(take all with caution I say...at one time I drank the BFL kool aid..thus am tainted by often being wrong)

[amacar2]

Now it is evident that Bitcoin price is at an all-time high. Prices have risen steeply, far too fast for my liking. I don't think such a growth is sustainable. The bubble is going to break very soon.

I think you are wrong this time, bitcoin is not in a bubble right now. New money have actually flown into crypto world. If you look at other alts you will find similar surge in them that suggest new investors are interested in cryptocurrency as a whole and not only in bitcoin, but to buy all of the other alts they have to buy bitcoin that could be the reason behind this massive pump we have.

[cryp24x]

Assuming this increase is a bubble, I believe the one that caused it is the good news that is coming from the development and adoption of Bitcoin in a different country.  Now that July is coming, many speculators think that bitcoin would probably double in price just like what happened when Japan accepted Bitcoin.