Category: Bitcoin

Categories
Bitcoin Crypto News Institutions Investing

Goldman Sachs Investors Divided on Whether Bitcoin is an Investable Asset

Goldman Sachs investors don’t seem to agree on whether Bitcoin (BTC) is an investable asset or not.

The multinational investment bank issued a report on June 15 called “Digital Assets: Beauty Is Not in the Eye of the Beholder” – concluding that Bitcoin is no longer an investable asset.

Bitcoin is Not “Digital Gold“

This new report was issued by the bank’s Investment Strategy Group and contradicts its plans to launch crypto investment services in Q2 for its wealthiest clients. As reported, Goldman Sachs began trading Bitcoin futures on June 18 in a partnership with Galaxy Digital.

Further, the report concludes that Bitcoin itself is not digital gold, as gold is not a “reliable store of value”:

The argument that Bitcoin and cryptocurrencies are a digital version of gold does not confer any value to Bitcoin and other cryptocurrencies, because gold itself is not a consistent or reliable store of value.

Crypto May Not Be As Viable an Investment as Many Thought

This also contradicts Goldman Sachs’ May 21 report called “Crypto, a New Assets Class?” where several experts in the crypto field, such as Galaxy CEO Mike Novogratz, were gathered to analyse the current market, outlining a positive future for cryptocurrencies and stating that they were a new alternative investment.

The report suggested that despite many advances in blockchain technology, this would become obsolete with time and many enterprises would turn away from it. It concluded by saying cryptocurrencies are not a “viable investment” for their clients:

After analysing various valuation methodologies and our multi-factor strategy asset allocation model, we have concluded that cryptocurrencies are not a viable investment for our clients.

Categories
Bitcoin Crypto News

Bitcoin Has Now Died 420 Times

Bitcoin has had more resurrections than the proverbial cat with nine lives: back from the dead a total of 420 times and counting.

Love it or hate it, Bitcoin just won’t turn up its toes. Despite being known for its high volatility, the asset hailed as ‘Gold 2.0’ has proven itself time and time again to be one of the best-performing assets, ever.

In spite of neverending FUD from high-profile haters and respected mainstream publications alike who declare Bitcoin dead, it continues to rise in value as its adoption by major Wall Street institutions grows.

When in Doubt, Just Zoom Out

The ‘Bitcoin Is Dead’ graph shows a history timeline, pulling from a database of news stories relating to Bitcoin scepticism, #RIPBTC.

I created “Bitcoin Is Dead” in hopes of playing a [tiny] role in telling its eventual story by tracking its most notable sceptics and documenting important pieces of its history. (Also I think freezing cold takes are pretty funny.)

Jerry Feng

All That Glitters is Not Gold, it’s Bitcoin

If you want to have some fun, head over to bitcoinisdead.lol to play the very fun game of ‘Who Else Fcuked Up?’

Rumours of Bitcoin’s ‘Death’ Were Exaggerated

Bitcoin’s “death” can be tracked at Bitcoin Obituaries, a website that collates data from news articles and blogs. The highest number of “deaths” per single year (124) was recorded in 2017, when its market cap hit $100 billion for the first time.

From haters to lovers, major players in the financial industry – including Morgan Stanley, JPMorgan, Goldman Sachs, Visa and PayPal – are guilty of condemning Bitcoin very publicly; now they all rally to support it. Maybe it’s FOMO (fear of missing out), or maybe it’s just smart. Big money is now doing backflips to get in on what’s becoming painfully obvious over time: Bitcoin is here to stay. Get in or stay out.

Categories
Bitcoin Bitcoin Mining Industries

Green Bitcoin Mining Company Bitfarms to Start Trading on the US Stockmarket

Bitfarms, a Quebecois company in charge of one of the largest crypto mining operations in North America, will be listed on NASDAQ on June 21. It will also continue to be listed on the Toronto Stock Exchange (TSX) as BITF.

The company had been waiting for its DTC eligibility check to be passed but is now cleared to enter the US stock exchange.

More Than 99% Clean Energy

The company, soon to be listed as $BITF, is committed to using green energy – and more than 99% of the power it uses to run its operations comes from hydroelectric energy.

Bitfarms Fulfils Long-Range Ambition

Argentinian entrepreneur Emiliano Grodzki – founder and CEO of Bitfarms – commented on the news, stating that a NASDAQ listing had been in the company’s sights for a while. Now that it’s finally achieved this goal, he said it was proud to be largest publicly traded eco-friendly mining farm:

This belief has guided us as we worked to build one of the largest Bitcoin mining operations worldwide. When Bitfarms begins trading on the NASDAQ, it will be the largest publicly traded Bitcoin miner in North America using greater than 99% hydroelectric renewable electricity. We are proud to be a leader in the industry in setting the highest standards for ourselves and our mining operations and to be uplisting to one of the most prestigious stock exchanges in the world. Having reached this milestone we are even more excited about where it will take our company next.”

Emiliano Grodzki

The company was founded in 2017 and controls five mining facilities in Quebec. Rated as a “Rising Star” by the TSX in February, Bitfarms apparently mines nearly 1% of all Bitcoin currently in circulation.

Bitfarms is just one of several eco-friendly Bitcoin projects, with Texas crypto mining rush and El Salvador volcano Bitcoin mining, working on ways to make Bitcoin less of a problem for the environment.

Categories
Bitcoin Crypto News

In 2012, Only Computer Nerds Used Bitcoin, Now Countries Are Using It

Over the past decade, Bitcoin has evolved from obscure digital collectible held by cypherpunks to globally recognised institutional asset being adopted by countries such as El Salvador as a currency. Over the past decade, its value has skyrocketed and, with a compound annual rate of return of over 200%, it has outperformed all other asset classes by a factor of at least 10.

In a tweet by an avid Bitcoin supporter, outlines Bitcoin’s adoption so far.

— Charlie Shrem (@CharlieShrem) June 15, 2021

Given Bitcoin’s meteoric rise into mainstream discourse, it’s worth reflecting on some of its major milestones along the way.

Bitcoin’s Historical Milestones

2008 – The Bitcoin Whitepaper is published by Satoshi Nakamato.

2009 – Bitcoin is launched and towards the end of the year, the first exchange publishes an exchange rate of US$1 = 1,309.03 BTC.

2010 – The first real world transaction in Bitcoin takes place, the infamous 10,000 BTC for two pizzas, valued at $25.

2011 – Bitcoin achieves parity with the US dollar.

2012 – Bitcoin crosses $100 for the first time.

2013 – Bitcoin crosses $1,000 for the first time and the FBI shuts down darknet marketplace Silk Road (the market’s funds have since been returned).

2014 – The biggest exchange at the time, Mount Gox, is hacked with 840,000 Bitcoins stolen, valued at roughly US$460 million.

2017 – Bitcoin forks and reaches a new all time high of $19, 834.

2020 – Bitcoin reaches a new all-time high of $28,949 and institional adoption accelerates. Insurance companies buy bitcoin, the first bitcoin fund is launched, the first bitcoin ETF is launched and MicroStrategy becomes the first listed company to convert corporate treasury into bitcoin.

2021 – Bitcoin reaches a new all-time high of $63, 346. El Salvador becomes the first country to adopt bitcoin as legal tender. A growing number of companies accept bitcoin as payment.

You can view more events on Bitcoin Timeline by TradingView.

The Path isn’t Straightforward

Despite its exponential growth and increased global recognition, Bitcoin has had to overcome innumerable threats and challenges over the years. Notwithstanding, today it’s arguably as resilient and antifragile as ever.

While bitcoin remains somewhat de-risked relative to its early days, HODLing isn’t easy. If it was, everyone would do it:

Categories
Bitcoin Cryptocurrencies Investing

$43 Billion of Bitcoin is Locked Up in Trusts and Global Investment Funds

A report by Financial News London shows that over US$43 billion worth of Bitcoin is currently held by investment companies.

These funds are spread across hedge funds, ETFs and wrapped Bitcoin (wBTC).

19 Firms Declare $6.5 Billion Share of Investments

Another report by Nickel Digital shows that of this total sum, around $6.5 billion worth of BTC has been declared by 19 companies, such as Goldman Sachs, Blackrock, Deutsche Bank and JPMorgan.

MAJOR DEVELOPMENTS IN DIGITAL ASSETS – Report by Nickel Digital

Commenting on the reports, Nickel Digital CEO Anatoly Crachilov said that not only can BTC serve as a hedge against inflation, its adoption by financial institutions may reduce its overall volatility in the near future.

The cryptoassets space remains volatile as it is going through the early stages of an adoption curve. [This is] a very important endorsement for Bitcoin’s emerging functionality of the hedge against inflation. Increasing allocations by large-scale institutional investors and corporate players is expected to lead to a reduction of [Bitcoin’s] volatility over time, due to a longer-term, stickier type of capital brought by those investors.

Nickel Digital CEO Anatoly Crachilov

The same report estimates that $4.3 billion was spent by these companies purchasing the BTC, bringing a profit of over $2 billion.

The vast majority of these companies are based in the US, with a few other publicly declared Bitcoin investors located in Europe, Australia and Asia. However, another survey by Nickel Digital shows that 81% of European institutional investors believe the amount of crypto purchased by wealth management firms is about to sharply increase.

Although the wind may be blowing in favour of mass crypto adoption, it’s important to remember that in the financial world things can change on a whim – so, as always, Do Your Own Research.

Categories
Australia Bitcoin Crypto News

An Estimated 19% of Bitcoin Supply Has Been Lost Forever

Of the approximately 18.5 million Bitcoins currently held (and of a total 21 million that will ever be created), it’s estimated that as many as 4 million have either been lost or stolen.

According to cryptocurrency data firm Chainalysis, 20 per cent of all Bitcoin accounts are owned by people who can’t access them.

Hard Drives, Hard Luck Stories

Stories are legion of lost Bitcoin, all of them sad though some not bereft of humour:

Very expensive landfill
  • British IT worker James Howells lost US$127 million in Bitcoin (BTC) when a forgotten hard drive containing a wallet with 7,500 BTC wound up in council landfill in 2013. Howells had spilt lemonade on his laptop and dismantled it, putting the hard drive in a drawer and later throwing it out after a clean-up. Those 7,500 BTC would be worth a cool $375 million today, if he could only convince council to dig up the landfill site to find the missing hard drive.
  • Earlier this year, a lost password locked San Francisco software developer Stefan Thomas out of his Bitcoin stash worth $US220 million. The secure hard drive, on which 7,002 BTC were stored, was an IronKey device that gives owners 10 chances to guess their password before encrypting the contents. Thomas only had two attempts left to guess correctly before the lockout occurred. His stash is worth about $350 million today.
  • When Gerald Cotten, CEO of Canadian crypto exchange QuadrigaCX.com, died unexpectedly aged 30 in 2018, he was the only person who knew the private keys used to access Quadriga’s crypto. An investigation by Ernest & Young identified six cold wallet addresses used by Quadriga to store Bitcoin. One of those wallets was since subject to an inadvertent transfer of Bitcoin. What happened to US$150 million in Quadriga crypto remains unresolved.

A Cautionary Tale From Closer To Home

Melbourne games developer Alex could have been a millionaire. In late 2009, when Bitcoin was still in its infancy and a single PC could “mine” a few coins in a day, the self-described technology enthusiast “got into it just for fun”. As it progressed, the Bitcoin program Alex was using grew to several gigabytes in size. “It kept on ballooning so eventually I deleted it [and] backed up the encrypted wallet file to keep on my USB stick.” That wallet contained the unique cryptographic keys for thousands of Bitcoins Alex had mined.

The thinking was that it’s offline, not on my PC, so in case something bad happened to the PC – [if] it blew up, or [was] hacked – I still had a backup.

‘Alex’, former Bitcoin miner

In late 2013, when the Bitcoin price peaked at just under $US980, Alex suddenly remembered his wallet. “[I plugged] the USB stick back in to access the file, but it died. It was one of those cheap made-in-China ones,” he said. His losses? Immeasurable. By the way, Alex is not his real name “because if my wife knows, I’m dead”.

World’s most valuable cheap USB?

Alex says now that if he “had the spare cash” he would consider getting back into Bitcoin, which he believes is a “fantastic gold substitute for long-term storage of wealth” that has many other useful applications.

Earlier this year, he mined “a lot” of Ethereum, the now second-most valuable cryptocurrency, which has similarly soared in value. “One day, maybe Ethereum might restore what I lost with Bitcoin.”

On average,  1,500 Bitcoins are lost every day. Again, those losses are permanent. As Bitcoin.com support has warned potential buyers, “All Bitcoin transactions are irreversible, so there is no way to reverse a transaction that has already been sent.” 

Categories
Bitcoin Crypto News Payments

El Salvador’s Government Considering Paying Workers’ Salaries With BTC

DCIM/100MEDIA/DJI_1758.JPG

El Salvador’s government is discussing if companies should pay their workers with Bitcoin, according to a tweet by a local radio station, 107.7 Fuego, on June 15.

El Salvador’s Minister of Labor Rolando Castro said three other government ministries were considering the possibility of companies paying workers’ salaries in BTC. The decision will be made once the country’s Bitcoin legal tender status comes into law. The ministry of labor will coordinate with the ministries of the economy and finance to put the plan forward.

El Salvador Setting the Pace With BTC Adoption

While El Salvador has been criticised by financial institutions for putting BTC as legal tender, the crypto community has praised the move as one of the key steps towards global adoption. The country now plans to use its wasted energy to mine Bitcoin in the country, using its state-owned geothermal electric company.

El Salvador has become a pacesetter for BTC adoption and other countries are now following its example. While many at first thought it would come from powerful countries like the US or Japan, adoption is taking place in less developed countries. Besides, Bitcoin and cryptocurrencies could help the unbanked – 75% of Salvadoreans are unbanked – to become more financially independent.

Tesla to Reconsider BTC Transactions … With One Condition

El Salvador and Elon Musk are the two main topics of discussion in the crypto community right now. While El Salvador prepares to make Bitcoin its official currency, Musk stated that Tesla could resume allowing BTC payments if its energy consumption were reduced by 50%.

Categories
Bitcoin Crypto News Investing

Hedge Fund Manager Paul Jones Calls Bitcoin ‘a Way to Invest in Certainty’

Billionaire hedge fund manager Paul Tudor Jones says he would want to have 5% in Bitcoin now that he sees how it can protect wealth in the long term.

In an interview with CNBC on June 14, when talking about Bitcoin (BTC) Jones stated that he likes investing in something that is “reliable, consistent, honest, and 100% certain”, and added that he favours Bitcoin as a portfolio diversifier.

Jones’s firm, Tudor Investment Corp, has US$44.6 billion assets under management (AUM) and has recently secured custodial ties with institutional crypto powerhouses Coinbase and Bakkt. Jones had previously recommended 1% to 2% BTC holdings in a portfolio in 2020 but has now stated that 5% would be a good allocation given the current state of the US Federal Reserve.

Uncertainty About Inflation

One of the reasons for changing his position is that Jones is “going all in on inflation trades” depending on US Federal Reserve decisions to address inflation by shifting its policies this week.

If they say, ‘We’re on path, things are good’, then I would just go all in on the inflation trades. I’d probably buy commodities, buy crypto, buy gold …

Paul Tudor Jones

If the FED decides not to do anything about inflation and prices continue to go up, investing in things that increase as price increases is a strategy (inflation trades). In the meantime, inflation data revealed the biggest price spikes in 13 years for two months in a row.

Additionally, Jones stated that stockmarket value has increased to 220% of the US gross domestic product (GDP); at the time the dot.com bubble burst, it was around 200%. This is something Jones said is of concern to him. The FED is currently meeting behind closed doors to discuss the economic figures, with a statement and press conference expected on June 16.

Categories
Bitcoin Crypto News

MicroStrategy Buy Another $500 Million Worth of Bitcoin

Michael Saylor is at it yet again, this time issuing debt to buy more bitcoin. Yesterday, he announced via Twitter that MicroStrategy had closed an offering of US$500 million in senior secured notes due in 2028 at an annual rate of 6.125%.

In the formal press release, some interesting information emerged:

  • MicroStrategy’s existing approximately 92,079 bitcoins are being held by a newly formed subsidiary, MacroStrategy LLC
  • The notes are fully and unconditionally guaranteed by MicroStrategy Services Corporation and certain subsidiaries (existing and formed in the future), and secured by all assets within such entities, including bitcoin acquired on or after closing
  • The notes however would not be secured by any existing bitcoin or bitcoin acquired from the proceeds of any sale of existing bitcoin

MicroStrategy May Sell $1 Billion in Stock to Buy More Bitcoin

In addition to the announcement above, MicroStrategy filed paperwork for the proposed sale of up to $1 billion in class A common stock, essentially giving the company the ability to sell stock, from time to time, as it deems fit.

Founder and CEO Michael Saylor has embraced the laser-eyes meme

According to the filing with the Securities and Exchange Commision (SEC):

We intend to use the net proceeds from the sale of any class A common stock offered under this prospectus for general corporate purposes, including the acquisition of bitcoin.

While it is not clear how much of the proceeds would be used to purchase more bitcoin, it would be surprising if Saylor deviated from the “convert corporate treasury into bitcoin” strategy that has been in place since last year.

Is the Bet Paying Off?

So far, with the Bitcoin price hovering at around US$40,000, it would appear as if it has:

As Dan Held has said, for a company called MicroStrategy, this strategy may well be one of the best macro strategies yet.

Who Else Has Been Buying Bitcoin?

If you’re interested in following the latest developments in this space, be sure to check out our Crypto Institutional Purchases List 2021 which we regularly update when new announcements are made.

Categories
Bitcoin Crypto News Venezuela

Venezuelans Are Using Bank Notes to Make Handcrafted Bags

On the streets of Colombia, from Bogotá to Cúcuta, artists are selling intricately crafted handbags and other beautiful accessories made from Venezuela’s colourful bolívar bank notes.

The old Venezuelan bolívars (also known as bolívar fuerte) are no longer in circulation and have been replaced by bolívar soberano.

Old Bolívar Notes Worth More As Raw Material

Due to hyperinflation, Venezuela’s currency has been devalued to the point that it is literally not worth the paper it is printed on. The notes are worth more to artists as a raw material than as actual money. An item made up of 1,000 bills totalling 100,000 bolivares is worth around US 20 cents in notes, but can sell at around $20 as a purse. As one merchant in Cúcuta commented:

 It would make more sense to rip this up and turn it into confetti than to try to use it to buy confetti, which would be more expensive.

Capino Porra (a merchant and retired Venezuelan military official)
Wallets and bags made from Venezuelan currency. Photo: Guillermo Legaria/Getty

The Government is So Poor It Cannot Even Afford to Print Money

Millions of Venezuelans have fled to neighbouring Colombia to escape civil unrest and a growing financial crisis. Venezuela is in dire straits. Even paper money itself is scarce. The government is so poor that it cannot even afford to print more money, forcing many to rely on bank transfers for even the smallest payments.

Venezuela and other Latin American countries are turning to Bitcoin and cryptocurrencies as their currencies see rising inflation and lose purchasing power. We have also seen that Argentina inflation has hit 42.6% as Bitcoin prices surge in the country.