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Bitcoin soars overnight as short sellers feel the squeeze and Amazon rumours continue

The price of bitcoin surged by 11.07% overnight, reaching its highest point in over one month, above £28,000.

It follows a reversal in the crypto market to a more bullish sentiment following mass sell-offs across April, May and June.

Bitcoin’s rally coincided with other cryptocurrencies, including Ether, up by 8.14% in the past 24 hours, and Chainlink, up 14.47%.

While it is not immediately obvious what caused the upwards surge, there are a few contending possible factors.

Firstly, there is the ‘B’ word conference which caused an initial spike, as Jack Dorsey, Cathie Wood and Elon Musk discussed bitcoin’s credentials in front of the world.

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Last night’s move could be a continuation in the momentum established after Musk made a series of revelations regarding his rocket company SpaceX, bitcoin and a potential u-turn by Tesla.

Then there are rumours continuing to circulate that major business institutions are set to take steps to incorporate bitcoin into their operations.

It has been reported elsewhere that Amazon is planning to accept bitcoin payments by the end of 2021, in addition to exploring the possibility of creating a token of its own.

“This isn’t just going through the motions to set up cryptocurrency payment solutions at some point in the future – this is a full-on, well-discussed, integral part of the future mechanism of how Amazon will work,” a source told City AM.

“It begins with Bitcoin – this is the key first stage of this crypto project, and the directive is coming from the very top… Jeff Bezos himself.”

Another possible cause is investors, who are short on bitcoin, betting the price off the cryptocurrency would fall further.

Such investors, when the price goes higher against their expectations, are forced to cut their losses and exit their positions.

“I think the extent of the jump was probably driven by over-leverage shorts,” said Vijay Ayyar, head of business development at cryptocurrency exchange Luno.

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