Why is Bitcoin surging?
Quite curious to find out why Bitcoin is surging (now past $400). What's causing this? How does Bitcoin surge because it is not a stock?
There are lots of financial instruments that are traded on markets that are not stocks. Things like oil, cattle futures, and currencies are all exceedingly commonly market traded instruments.
When people are saying that Bitcoin is "surging" what they are saying is that the price is going up on a variety of markets where Bitcoin can be exchanged for USD.
It is comparable to when the Euro goes up in value in comparison to the Dollar.
Bitcoin is different than most currencies in that macro-economic factors largely drive the price differences in most headline currency prices. Bitcoin is still such a tiny market that minor fluctuations in a small set of speculative market participants can cause large price swings.
http://www.ft.com/intl/cms/s/2/ee93bc2e-82f6-11e5-8095-ed1a3...
Top theory was that the world's most infamous Ponzi scheme architect is heavily promoting a BTC-based pyramid scheme based around "community" and "sharing" in multiple new markets, including China. Other theories include market manipulation by the Winkelvosses, and mainstream coverage of non-BTC "blockchain tech" being used by major financial institutions.
All of these effects may be pretty minor, but once BTC starts to surge it doesn't take much to get the speculators going
Last year it was worth over $400, and then it crashed down to just over $200. There's no reason to assume this year's surge won't go the same way.
Bitcoin needs sustainable growth, not these crazy spikes caused by people seeing the jump and joining in to "get rich." Who knows what started it? Maybe just a very large single trade.
I will say at the current price ($480 ish) you'd be foolish to invest, it is more likely to crash than it is to keep surging (at least looking at historical data).
The expression "get in on the ground floor" applies here.
Speculative market participants smooth price imbalances in most markets.