Cloud Hosting

Bitcoin BTCUSD, +1.41% caught fire this weekend, taking out yet another record high and pushing above $50 billion in market capitalization for the first time ever. This after selling off in the wake of the split last week.

So whats triggering the latest push?

Apparently, a deep-pocketed trader (or group of traders), nicknamed Spoofy, is rumored to be manipulating the bitcoin market by employing his namesake tactic on the Bitfinex cryptocurrency exchange, according to Cointelegraph.

Read: 10 things you need to know about bitcoin.

Spoofing is when a trader makes a deceptive bid or offer with the intent of canceling it before execution, thus giving the illusion that somebody is getting ready to buy or sell and potentially triggering a notable move in price.

For example, if Spoofy places a large buy order that entices smaller traders to hop aboard, he can turn around and instead use the uptick to execute a sell order.

Weve seen it before in other markets, like when Navinder Sarao, the British trader accused of contributing to the 2010 stock market flash crash, pleaded guilty to using the shady tactic.

So yes, spoofing is illegal, but since bitcoin markets are mostly unregulated, its quite common, Cointelegraph reports. The difference in Spoofys case is that hes got a massive bankroll that allows him to regular place orders upward of $60 million.

The BitCryptoed blog described the impact hes had on bitcoin.

Spoofy makes the price go up when he wants it to go up, and Spoofy makes the price go down when he wants it to go down, the blogger wrote. And hes got the coin both USD, and bitcoin, of course, to pull it off, and with impunity on Bitfinex.

Read: It could get ugly soon for bitcoin if this chart is right.

Continue reading here:
Why is bitcoin surging? Ask 'Spoofy,' the trader who's reportedly manipulating prices - MarketWatch