Could the recent dramatic increase in the market capitalization of Monero be linked in some way to the Bitfinex hack and theft of $70 million in Bitcoin?
Monero, which has competed fiercely for the label of the anonymous and private cryptocurrency, experienced a recent growth spurt, over tripling in value over the course of just a few days. This came just a couple weeks after a hacker stole a large amount of Bitcoin, a more easily traceable cryptocurrency, from a major online exchange, prompting speculation that those funds may have been converted into Monero for more private use, causing the currency’s price to spike dramatically.
Monero’s Spike Coincides Well With The Aftermath Of The Bitfinex Hack
The relation between Monero’s increase in market capitalization and the Bitfinex hack seems plausible from a timeline standpoint. The funds were stolen at the beginning of August, and the ensuing cleanup, including the drama over the plan to “socialize” the exchange’s losses over its entire customer base, took place over the next couple of weeks. Then, around August 22nd, the market cap began to rise in two sharp increments from around $30 million to over $100 million. Though price increases are by no means as simple as an addition of the amount of money abruptly coming into the market, it is fun to think about how Monero’s market cap of around $30 million plus the stolen Bitcoin of about $70 million does approximate the final XMR market cap.
According to Genitrust CEO Robert Genito, getting rid of stolen Bitcoin would make the most sense by converting it to something less traceable before being able to spend it more freely:
“WELL, IF I STOLE OVER $70 MILLION WORTH OF BITCOIN, I CERTAINLY WOULD NOT LIQUIDATE THAT ON A BITCOIN EXCHANGE. FIRST, I WOULD PUT IT INTO ALTCOINS–ESPECIALLY “MIXING” ALTCOINS.”
Possible Hacked Funds Only Part Of The Picture
In addition to a potential growth spurt fueled by the movement of stolen Bitcoin, darknet markets and services, such as Sigaint and Alphabay, integrated Monero into use, providing another good explanation for part of the market cap surge.
Cryptocurrency investor Marc De Mesel thinks that a host of other factors and recent events may be responsible for Monero’s market cap increase, including recent dark market integrations:
“Maybe, I’m not aware of this. I think Monero had a good chance to go up a lot once it broke its ATH of 400k satoshi as this had been reached twice the past few years but never broke. So traders were ready to jump on it once it finally did. In addition more and more bitcoiners are starting to realize Bitcoin won’t become a currency for the common man if it’s fees continue to go up. Probably some hardcore bitcoin whales have started to invest in Monero as well. And of course the news that some dark markets are considering implementing Monero gave more confidence to investors.”