The rally in cryptocurrency prices yesterday may have come from an unexpected source
There was a large short covering rally that took place yesterday which helped boost prices, but what caused those shorts to cover?
Yesterday in a post I mentioned how there was likely a large short covering that took place which helped boost prices rather dramatically and did so rather quickly.
The post can be found here:
https://steemit.com/bitcoin/@jrcornel/curious-why-bitcoin-just-jumped-usd1-200-in-less-than-an-hour
That theory was supported by the fact that many margin short positions were indeed closed on Bitfinex.
However, what caused them to close their positions, what caused them to get margin called?
Yesterday there was a piece of news that seemed to fall through the cracks, a piece of news that just so happened to come out right around the same time that Bitcoin prices started to rally.
What piece of news might that be you might ask?
How about something like this?
"Bitcoin market suddenly opens to 1.6 billion Muslims as cryptocurrency declared halal under Islamic law."
According to the news release, an Islam scholar delcared that bitcoin is now permissibile under Sharia Law.
Which would mean that the bitcoin market would now be open to investments from potentially billions of Muslims around the world.
This announcement was released right around the same time that Bitcoin started to go on a major run.
(Source: http://cointhud.com/islamic-scholar-bitcoin-sharia-law/)
Could it be that the run was kick started by money flowing in from Muslim investors?
That also would jive with the narrative from Olga Feldmeier, the CEO of fintech startup Smart Valor.
He had this to say regarding the price surge:
"Many speculated that the sentiment around bitcoin was getting more positive, and that it may have been related to Sharia law compliance. Others assumed there was unwinding of a large short-selling position. I personally think that this rise was due to a large institutional investor.”
Could that large institutional investor have been a rich Muslim "allowed" to enter the cryptocurrency markets for the first time?
Due to the semi-anonymous nature of bitcoin transactions we can't know for sure, but the timing of the surge leads me to believe that this news likely sparked a short covering rally that may have also coincided with new money coming in due to the updated classification of bitcoin and cryptocurrency under Sharia Law.
Stay informed my friends.
Image Source:
https://bravenewcoin.com/news/sharia-law-and-bitcoins-fatwa/
Follow me: @jrcornel
Thanks for your commentary! STEEM on brother 🤑
there's no doubt that Muslims would rather choose bitcoin than fiat currency from federal reserve, because of fiat dollar it created so much war in the middle east that killed countless innocent Muslims just to suck out all their oil.
beautiful mosque
Awesome catch. Something must have triggered the initial increase, which led to the short squeeze and price spike.
Just needed a spark. :)
Spark is the keyword. This market is needs only the smallest of postive or negative sentiment to skyrocket or collapse.
Makes sense as more adoption leads to interest and thus demand for the asset. Given the limited supply of Bitcoin, there can also be a imbalance that leads to dramatic price changes.
Yes there could be. The supply is mostly fixed, which means prices will respond to changes in demand.
I read something about this... that BTC was approved as Halal, by Sharia Law. That opens up the market to 1.5 billion potential buyers!
Some wealthy folks in the middle east looking for some diversification of their assets perhaps.
I also see that George Soros is going to start trading BTC. This is going to be interesting (thank God for altcoins)
Muslims, Soros, and start of second quarter (tax season selling over, tax refunds coming in, extra cash coming in) is usually good for crypto.
If true, this gives a boost to the hopes for a sustained rally for crypto prices. Who else has faith in STEEM?
That is my thought as well. If it's really the reason for the rally, this rally could have some major legs to it.
Now, some people are going to start hurrying to buying without doing their home work well. It is the beginning of the bull run and anyone can make profits from it. However, caution is still needed at this time.
Yes, if that is indeed the case, we could see another FOMO type rally in the very near future.
Interesting news, clearly the adoption is growing and this will have a great impact on the market. Cheers!
Thank you for posting @jrcornel.
This is good news indeed.....appreciate your reporting.
Cheers.