It's driven by speculation, any serious speculator will never miss this vehicle, this is just the beginning
5 hedge funds, each push the price to a target area (like 4x) and dump it to the next one, they keep buying and selling with profit, same game wallstreet guys have been playing for decades
Actually I think the biggest enemy of BTC are these players with huge amount of fiat capital, although BTC was designed to be a currency free of central banks manipulation, it still could be manipulated by the powerfull players in the market
I think there is a real risk of people with deep deep FIAT reserves realizing the publicity of Bitcoin has given them a perfect vehicle through which to pump money from inexperienced speculators. The higher the price, the more press coverage, the more ordinary people come and put 1-2K USD into it, the more they dump and buy it back cheaper.
These are very real concerns, however as people rich in FIAT will try to destabilize the price of bitcoin, people rich in bitcoin could act to stabilize it. Sell when the price is rising too quickly, sit on the dollars and buy back bitcoins when the price is crashing. I think it's really a moment when we will see if the community is serious about bitcoin or just a bunch of greedy speculators.
No hedge fund can break bitcoin if there are enough early adopters that are willing to stand up to them.
If you care for bitcoin, you should sell when prise is rising and buy when price is falling!
Unless of course their game is to slowly buy up ALL the BTC. Remember it's divisible to 8 decimal places. Why not have some hedge fund buy up now a good portion of a future world currency? It would be like the cartel on the diamond market. Most diamonds are bought up just to be stored in vaults and thus protect the price level.
Lets say some fund decided they wanted half of all BTC, they slowely buy it all up. We don't notice except our glee at a rising price. The rising price raises BTC's value, and we start dealing in mili BTC like nothing's happened. Except something has happened, and this funds control over so many BTC means that they can artificially inflate the price of BTC, and when they sell it, demand ever higher amounts of FIAT. It *could* (read COULD!!!!) be a perfect way to suck money out of those afraid of central banks.