Bitcoin Surged By $300 in the Past 24 Hours. Here’s Why
After plunging for the majority of July, Bitcoin is clawing back toward its all-time high.
The cryptocurrency jumped 15% to $2,628 in trading Thursday, adding about $316 over the course of 24 hours. For comparison, Bitcoin was trading at about $1,863 this past Sunday. Now it’s about 15% off from its all-time high of $3,019 from this past June.
Coincidentally, Bitcoin’s price surge coincided with law enforcement agencies in the U.S. and Europe taking out two of the biggest “dark web” operations known to accept Bitcoin and Ethereum Thursday, including online black market Alphabay.
But the surge also comes amid growing confidence in Bitcoin’s scalability: As the cryptocurrency has grown more popular, processing transactions has become slower and more costly, with some trades lasting days. But in the search for a solution to the problem, Bitcoin’s adherents have split into two factions called Bitcoin Unlimited and Bitcoin Core—both of whom consider their idea the better option, Slate reported.
Part of the reason for Bitcoin’s volatility in recent months comes from a fear that those two factions won’t be able to compromise, effectively forcing Bitcoin into two incompatible cryptocurrencies.
There is hope, however, for compromise—with statistics website Coin Dance showing that this “middle ground” dubbed BIP (Bitcoin Improvement Proposal) 91 has about 72% support. It needs roughly 80% support before August 1 to be implemented.
BIP 91 could also help Bitcoin scale its blockchain, a record of all past transactions. As of now, it can only add about 1 megabyte of data every 10 minutes. BIP 91 would introduce an update that would up that limit to 2 MB in about three months. It would also introduce a way to fit in more transactions using that 2 MB of data. This, in theory, would make transactions faster and cheaper.
At the same time, fellow cryptocurrency Ethereum has also bounced back by about $40 since the start of the week, a 26% increase. In general, cryptocurrencies have recovered from their respective dips this week, as fears of a bubble appeared to abate slightly.
At Fortune’s Brainstorm Tech conference on Wednesday, SoFi’s CEO even voiced his support for Ethereum, which he says has a better chance of being used as a currency than Bitcoin.
Ethereum, though, has dipped over the past 24 hours, falling to about $200 from above $240.