Bitcoin soared 6% in 20 minutes Friday morning U.S. Eastern, continuing the rollercoaster ride that has characterized its 12-year existence.
The digital currency recently traded at $47,310, up 10%. To give you an idea of its volatility, Bitcoin has slid 20% in the past six months but more than quadrupled (up 347%) in the past 12 months.
As for Friday’s gain, market participants offered several explanation to Bloomberg.
Some said the proliferation of other digital currencies creates lower volume for Bitcoin, which can mean sharper ups and downs.
Others cited comments from Federal Reserve Chairman Jerome Powell on Thursday that the Fed has “no intention” of banning cryptocurrencies. Still others gave the nod to chart-based trading.
The debate as to what bitcoin really is continues to rage among bulls and bears.
Bulls say bitcoin’s use as a medium of exchange in normal commercial transactions will grow.
Bears point out that few consumers and companies will want to use such an unstable currency to buy and sell goods and services.
Bitcoin bulls say the digital asset is a hedge against inflation and a store of value. Bears note that the only thing bitcoin has proved to be so far is a vehicle for speculation.
The bulls also maintain that the currency can protect investors against declines in other markets, like stocks. But the bears note that since bitcoin was created in 2009, no sustained drop in stocks has occurred to test that theory.
And on plenty of days, stocks and bitcoin have fallen in tandem.