FILE PHOTO: Representation of the virtual currency Bitcoin is seen on a motherboard in this picture illustration taken April 24, 2020. REUTERS/Dado Ruvic/Illustration/File Photo
(Reuters) – Bitcoin dropped 6.39% to $43,165.78 on Sunday, losing $2,944.20 from its previous close.
Bitcoin, the world’s biggest and best-known cryptocurrency, has fallen 26% from the year’s high of $58,354.14 on Feb. 21 when it soared amid increasing confidence that it will become a mainstream investment and payments vehicle.
Major firms such as BNY Mellon, asset manager BlackRock Inc and credit card giant Mastercard Inc have backed cryptocurrencies. Tesla Inc, Square Inc and MicroStrategy Inc have invested in bitcoin.
Ether, the coin linked to the ethereum blockchain network, dropped 8.88% to $1,329.46 on Sunday, losing $129.57 from its previous close.
Reporting by Juby Babu in Bengaluru; Editing by Lisa Shumaker
FILE PHOTO: A representation of virtual currency Bitcoin is seen in this illustration taken November 19, 2020. REUTERS/Dado Ruvic/Illustration/File Photo
(Reuters) – Bitcoin continued gaining on Sunday, rising to a fresh high and extending a two-month rally that took its market capitalization above $1 trillion on Friday.
The world’s most popular cryptocurrency rose to a record $58,354, taking its weekly gain to around 20%. It has surged around 100% this year.
Bitcoin’s gains have been fueled by evidence it is gaining acceptance among mainstream investors and companies, such as Tesla Inc, Mastercard Inc and BNY Mellon.
Reporting by Megan Davies in New York; Editing by Daniel Wallis
Telsa billionaire Elon Musk, whose tweets about the meme-based cryptocurrency dogecoin helped push it to a $10 billion valuation, has warned the price of bitcoin and ethereum “seem high.”
The bitcoin price has surged by almost 500% over the last 12 months, partly due to Musk’s pro-bitcoin and cryptocurrency tweets and his electric car company Tesla adding bitcoin to its balance sheet—following in the footsteps of U.S. software company MicroStrategy
MSTR
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MORE FROM FORBESExclusive: YouTube Stars Jake Paul And Ben Phillips ‘Discussed’ Creating A Cryptocurrency As Bitcoin And Dogecoin Mania SpreadsBy Billy Bambrough
Elon Musk, the chief executive of both Tesla and SpaceX, has long been known as a cryptocurrency … [+] supporter but has recently increased his participation in the space as the price of bitcoin and ethereum have soared.
AFP via Getty Images
The bitcoin price climbed to $57,000 this week, giving it a total value of over $1 trillion, while ethereum, the second-largest cryptocurrency, broke $2,000 per ether token for the first time—giving it a total value of $226 billion.
Musk made the bitcoin and ethereum price warning during a discussion on Twitter about the nature of money. Replying to gold investor and bitcoin skeptic Peter Schiff, Musk said: “Money is just data that allows us to avoid the inconvenience of barter. That data, like all data, is subject to latency and error. The system will evolve to that which minimizes both. That said, bitcoin and ethereum do seem high.”
Earlier this week, Musk sought to distance himself from Tesla’s $1.5 billion bitcoin-buy, which pushed the price of bitcoin sharply higher when it was revealed.
“Tesla’s action is not directly reflective of my opinion,” Musk said via Twitter in response to a Bloomberg interview with the chief executive of bitcoin and cryptocurrency exchange Binance.
“Having some bitcoin, which is simply a less dumb form of liquidity than cash, is adventurous enough for an S&P 500 company … When fiat currency has negative real interest, only a fool wouldn’t look elsewhere. Bitcoin is almost as bs as fiat money. The key word is ‘almost.'”
Bitcoin’s mega 2021 rally has seen its price almost double since the beginning of the year thanks to a combination of Wall Street institutional adoption, corporate interest, and retail traders piling into the market.
“There are a number of reasons why bitcoin is soaring, but what stands out most is the trend that MicroStrategy started and Tesla popularised: moving institutional balance sheets into bitcoin to hedge against inflation,” Nicholas Pelecanos, head of trading at blockchain network NEM, said in emailed comments.
MORE FROM FORBES‘Doge Is Underestimated’-Elon Musk’s ‘Fav’ Bitcoin Rival Dogecoin Is Getting A Surprise UpgradeBy Billy Bambrough
The bitcoin price rally has accelerated in recent weeks, helped higher by Elon Musk and Tesla.
Coinbase
Ethereum, meanwhile, has benefitted from the rise of decentralized finance (DeFi)—using cryptocurrency technology to recreate traditional financial instruments such as interest, known as “yield,” and insurance. Many of the biggest DeFi projects are built on top of ethereum’s blockchain, pushing the ethereum price higher as users flood the network.
“We’ve reached an inflection point where people are questioning traditional monetary systems and recognising that there are better, fairer options,” Jai Bifulco, chief commercial officer at blockchain-based precious metals exchange Kinesis, said in emailed comments.
The broad bitcoin and cryptocurrency market, made up of thousands of digital tokens, is now worth a staggering $1.7 trillion—up from $800 billion at the beginning of January.
The OG Nyan Cat meme uploaded to YouTube in 2011. Gif: Chris Torres
Nyan Cat is turning 10 years old in April (feel old yet?), and to celebrate the anniversary of one of the internet’s most wholesome memes, the artist behind the gif, Chris Torres, put a newly remastered version up for auction. On Friday, the piece sold for 300 Ether on the crypto art platform Foundation, which translates to roughly $587,000 based on the cryptocurrency’s value at the time of publication.
In an interview with the Verge, Torres said he doesn’t ever plan to sell another original image file of Nyan Cat, meaning this gif’s patron now owns a truly one-of-a-kind piece.
“I think it’s cool knowing you own the only piece in existence,” he told the outlet. “And I feel like Nyan Cat will be a really special one to own.”
Torres made a series of tweaks and changes to the almost decade-old gif, which included enlarging the gif and making minor touch-ups to the art to correct details that bugged him over the years. For example, one particular star would appear and disappear randomly in the original 12-frame animation, so he took this opportunity to just remove it entirely. Torres told the Verge that he thought the remastered version “turned out really well this time around.”
If your eyebrows shot up at that multi-thousand-dollar price tag, you should know that the crypto art marketplace is having one hell of a moment. A number of online platforms have sprung up in recent years such as SuperRare, Zora, and Nifty Gateway where artists and patrons exchange digital works worth thousands of real-world dollars. Foundation is one of the newest faces on the scene, having launched just two weeks ago, but it’s already reportedly recorded $410,00 in sales, per the Verge.
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These crypto art platforms generally sell works through “non-fungible tokens,” or NFTs, blockchain-based digital tokens that represent unique assets. Since NFTs aren’t divisible and no two are alike, their ownership can be verified and tracked through blockchain. Though it should be noted that on many crypto art platforms, the actual sales, such as that of the new-and-improved Nyan Cat gif, are made with Ether, a cryptocurrency that runs on the Ethereum blockchain and is second only to Bitcoin in terms of market capitalization and volume, according to Reuters.
The crypto community has been buzzing about NFTs for a while, but traditional branches of the art world have only recently begun embracing blockchain technology. This week, Christie’s famed auction house announced its first-ever auction of a purely NFT-based collection: “Everydays: The First 5000 Days” by Beeple, a digital artist whose NFT-based series of digital works sold for $3.5 million in December. Christie’s also confirmed with Bloomberg that it plans to accept Ether as payment for the artwork’s principal price (collectors will still have to use old-fashioned dollars to cover any additional auction house fees).
U.S. Treasury Secretary Janet Yellen has reaffirmed that it is important to ensure that bitcoin and other cryptocurrencies are not used for illicit financing. In addition, she stresses the importance of regulating institutions that deal with bitcoin.
Janet Yellen Claims It’s Important to Make Sure Bitcoin Is Not Used for Illicit Financing
U.S. Treasury Secretary Janet Yellen answered some questions regarding bitcoin and cryptocurrency regulation in an interview with CNBC Thursday.
Yellen said she considers bitcoin a “highly speculative asset,” emphasizing its high levels of volatility in recent years. Responding to a question about whether bitcoin and cryptocurrencies need to be regulated, the treasury secretary said:
I think it’s important to make sure that it is not used as a vehicle for illicit transactions and that there’s investor protection. And so regulating institutions that deal in bitcoin, making sure that they adhere to their regulatory responsibilities, I think is certainly important.
The price of bitcoin hit an all-time high again Friday, pushing its market capitalization above $1 trillion. At the time of writing, the BTC price stands at $54,757.
This is not the first time Yellen has talked about cryptocurrencies fuelling illicit transactions. At her Senate confirmation hearing in January, she said: “Cryptocurrencies are a particular concern. I think many are used … mainly for illicit financing.” She subsequently clarified her position and promised to work with other federal regulators to implement “effective” crypto regulation. Then last week, she said the misuse of cryptocurrencies “is a growing problem,” reiterating that they “have been used to launder the profits of online drug traffickers” and have “been a tool to finance terrorism.”
Commenting on Yellen’s remarks about bitcoin on Thursday, Rich Dad Poor Dad author Robert Kiyosaki wrote:
Sec Treasury Yellen just said on CNBC bitcoin is used in criminal activity. Give me a break. And the US dollar isn’t. Who can believe these Academic Elites? Do they think we are that naive? Definitely buy more gold, silver, bitcoin.
A growing number of large corporations have embraced bitcoin. The cryptocurrency recently got a massive boost when Elon Musk’s electric car company, Tesla, revealed that it had purchased $1.5 billion of BTC and will soon accept the cryptocurrency as a means of payment for its products. Mastercard also announced that it will allow certain cryptocurrencies on its network, and the nation’s oldest bank, BNY Mellon, unveiled a crypto unit to provide bitcoin services. In addition, the U.S. city of Miami is trying to become a bitcoin hub.
Meanwhile, the pro-bitcoin U.S. Senator from Wyoming, Cynthia Lummis, is on a mission to convincing Yellen that bitcoin is a great store of value. Lummis said she met with Yellen and believes that she has an open mind on this subject. However, the senator still believes that it will take some time to convince the treasury secretary.
What do you think about Yellen’s bitcoin remarks? Let us know in the comments section below.
Image Credits: Shutterstock, Pixabay, Wiki Commons
Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.
FILE PHOTO: A collection of bitcoin (virtual currency) tokens are displayed in this picture illustration taken Dec. 8, 2017. REUTERS/Benoit Tessier/Illustration/File Photo
SINGAPORE (Reuters) – Bitcoin pulled back from a record high on Monday and other cryptocurrencies slipped, as investors took profits from a record-breaking rally that had pushed bitcoin close to $50,000.
Bitcoin fell as much as 5.6% to $45,914 in Asian trading hours after having posting a record peak of $49,714.66 on Sunday, while rival crypto ethereum slid more than 8%.
Once on the fringes of finance, bitcoin is fast gaining legitimacy as an asset class and has leapt 20% in the week since electric carmaker Tesla Inc announced it had $1.5 billion in bitcoin and would accept the currency as payment.
It is up more than 60% for the year to date and has gained more than 1,100% since hitting a one-year low last March.
“There’s this unadulterated wave of big players (buying) that has continued to push the price higher,” said Chris Weston, head of research at Melbourne brokerage Pepperstone. “We might be seeing one or two big funds just cashing out,” he said.
“The big question is: OK, you want to buy the pullback, but how big is the pullback that we are talking about?”
Besides Tesla’s investment, Bank of NY Mellon last week said it formed a new unit to help clients own and trade digital assets.
Bloomberg reported on Saturday that Morgan Stanley’s investment arm is weighing a bet on bitcoin.
Reporting by Tom Westbrook; Editing by Kim Coghill and Sam Holmes
Crypto asset manager CoinShares has reported that investment inflows into institutional cryptocurrency funds surged last week, and the majority of it was Ethereum.
The report states that of the $245 million crypto inflow last week, 80% of it or $195 million was invested into Ether products ahead of the launch of the Chicago Mercantile Exchange Ethereum futures contracts on Feb. 8.
Comparatively, Bitcoin had $41.9 million of the weekly flows, with a year-to-date total of $2.02 billion. The report suggested that investor diversification was starting to occur, adding that there was little evidence of taking profits with investors preferring to buy and hold.
“We believe investors are looking to diversify and are growing increasingly comfortable with Ethereum fundamentals. Bitcoin had its lowest inflows (US$42m) since the all-time highs were achieved in the week ending 8th January 2021.”
Total inflows into digital asset investment products for 2021 so far now totals $2.6 billion — equating to 39% of the $6.7 billion in institutional capital that was invested in crypto funds during 2020 in just six weeks.
The report stated that investment product trading volumes remain high, averaging $670 million per day last week — representing 5.4% of total Bitcoin trading volumes.
Grayscale remains the largest institutional crypto asset fund with a record $33.4 billion in assets under management (AUM) as of Feb. 8.
02/08/21 UPDATE: Net Assets Under Management, Holdings per Share, and Market Price per Share for our Investment Products.
Grayscale’s Ethereum Trust has been growing in terms of the total share of the AUM figure and has now reached over $5 billion which equates to over 15%. The Bitcoin Trust still contains the lion’s share of all investments, however, with 82% of the total.
CoinShares reports that 21Shares is the second-largest institutional fund by weekly inflows with almost $21 million, followed by WisdomTree with $11.5 million.
Many pundits expected the launch of CME’s Ether futures would be followed by a sharp crash to repeat the collapse in prices that followed the launch of Bitcoin futures in December 2017.
However, Ethereum rallied after contracts launched, posting a new all-time high of $1,780 on Feb. 9. ETH last changed hands for $1,750 at the time of writing.
A 24-year-old founder of two cryptocurrency hedge funds pleaded guilty to securities fraud on Thursday.
The two hedge funds had more than $100 million in assets, the Department of Justice said.
He embezzled almost all of one’s capital to pay for personal expenses including a penthouse apartment.
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The founder of a cryptocurrency hedge fund that claimed to use a trading algorithm to capitalize on price differences in several crypto assets pleaded guilty to securities fraud on Thursday, the Department of Justice said.
Stefan He Qin, a 24-year-old Australian national, admitted in court that he had embezzled nearly all the assets raised in his Virgil Sigma Fund, which along with his VQR Multistrategy Fund had more than $100 million in assets, the DOJ said.
Qin used the assets to pay for personal expenses including a penthouse apartment.
Prosecutors said Qin stole money from investors in Virgil Sigma, then tried to pay them back with the assets raised from investors in his second multistrategy fund.
“The whole house of cards has been revealed, and Qin now awaits sentencing for his brazen thievery,” Audrey Strauss, the acting US attorney for the Southern District of New York, said in a statement.
For years Qin made misrepresentations and false promises to lure new investors into his funds. Marketing materials for Virgil Sigma claimed that the strategy had been profitable every month since August 2016 except for March 2017, the DOJ said.
Qin faces a sentence of as long as 20 years in prison.
In a statement, Qin’s lawyers said he “has accepted full responsibility for his actions and is committed to doing what he can to make amends.”
Read more: Market wizard Michael Kean has averaged a 29% annual compounded return since starting his company 10 years ago. He shares his unique stock-picking strategy and 4 pieces of advice for anyone who wants to become a trader.
Joe Biden’s pick to become the new U.S. Treasury Secretary, Janet Yellen, has clarified her stance on bitcoin and cryptocurrencies. This follows her remarks during a Senate hearing when she said that cryptocurrencies are mostly used for illicit financing.
Janet Yellen Clarifies Her Crypto Plans
Janet Yellen clarified her position on the regulation of cryptocurrencies in a written testimony published Thursday following the Senate hearing on her nomination as the Treasury Secretary. During the hearing, Yellen made some statements regarding cryptocurrencies which were heavily criticized as being inaccurate.
The finance committee began by briefly describing the benefits and risks of bitcoin and other cryptocurrencies. “Bitcoin and other digital and cryptocurrencies are providing financial transactions around the globe, like many technological developments, this offers potential benefits for the U.S., and our allies,” the written testimony reads. “At the same time, it also presents opportunities for states and non-state actors looking to circumvent the current financial system and undermine American interests. For example, the Central Bank of China just issued its first digital currency.”
“Dr. Yellen, what do you view as the potential threats and benefits these innovations and technologies will have on U.S. national security? Do you think more needs to be done to ensure we have appropriate safeguards and regulations for digital and cryptocurrencies in place?” the finance committee asked the Treasury Secretary nominee.
Yellen replied: “I think it important we consider the benefits of cryptocurrencies and other digital assets, and the potential they have to improve the efficiency of the financial system.”
She continued, “At the same time, we know they can be used to finance terrorism, facilitate money laundering, and support malign activities that threaten U.S. national security interests and the integrity of the U.S. and international financial systems,” elaborating:
I think we need to look closely at how to encourage their use for legitimate activities while curtailing their use for malign and illegal activities.
“If confirmed, I intend to work closely with the Federal Reserve Board and the other federal banking and securities regulators on how to implement an effective regulatory framework for these and other fintech innovations,” Yellen concluded.
Yellen’s clarification marginally softens her stance on cryptocurrency, contrasting her previous statements made during her confirmation Senate hearing. “Cryptocurrencies are a particular concern. I think many are used … mainly for illicit financing and I think we really need to examine ways in which we can curtail their use and make sure that anti-money laundering (sic) doesn’t occur through those channels,” Yellen said a few days prior.
Last week, the president of the European Central Bank (ECB), Christian Lagarde, also made a statement about bitcoin that drew much criticism. She said bitcoin “has conducted some funny business and some interesting and totally reprehensible money laundering activity.” Many were also quick to point out how wrong Lagarde was, including a famed economist who said her statement was “outrageous.” He stressed that “we all know that the vast majority of money laundering globally is conducted in fiat currencies, particularly in U.S. dollars and euros.”
What do you think about Janet Yellen’s follow-up remarks about bitcoin? Let us know in the comments section below.
Image Credits: Shutterstock, Pixabay, Wiki Commons
Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.
