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How to invest in cryptocurrency (without losing your shirt) – MoneySense

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Upfront, I should disclose I personally started to dabble in this asset class for the first time in the autumn of 2020, having sat out the first iteration of bitcoin mania in 2017. But this time, growing institutional acceptance seems to have brought back an even stronger wave of enthusiasm and euphoria, buoyed in part over the frustration of minuscule interest rates and inflationary forces unleashed by endless money printing by central banks in the U.S. and the rest of the world.

For me, the impetus this time around was the Profits Unlimited newsletter, edited by Paul Mampilly. I have found Mampilly so insightful with his recommendationsit was he who first twigged me to the actively managedARK ETFsthat focus on the innovation economythat I decided to take a flyer on two of his suggestions for how investors could buy trusts that track the price of bitcoin and ethereum, which trade over-the-counter.

Rather than suggest pure native exposure, which involves setting up complicated wallets that hold pure crypto and other minutiae, he felt it was easier for casual investors accustomed to buying stocks online to use trusts like Grayscale, which trade over-the-counter on U.S. stock exchanges, but are available to most Canadian investors. These trusts roughly track the price of the crypto they target, but often trade at a discount or a premium to the actual price of the native currency.

Mampilly suggests taking an equal-weight approach to more speculative investments, so my first try was to put several thousand dollars into each of theGrayscale Bitcoin Trust(GBTC/OTC) andGrayscale Ethereum Trust (ETHE/OTC). I hold these in non-registered TD Direct Investing accounts.

I soon experienced just how volatile these can be. ETHE quickly doubled butpreferring not to trigger taxable gainsI stood pat, only to watch it plunge below my original cost. Still, I kept holding and continued researching the field, and it eventually reached the level it is right now, well above cost.

I next realized I wanted to hold these experimental positions in registered portfolios (RRSPs and TFSAs) so that the next time I got a double or tripleif indeed they materialized rather than comparable lossesI could book the gains with no immediate tax consequences. I soon discovered the closed-end funds of Toronto-based3iQ Digital Asset Management. First, I tried The Bitcoin Fund [QBTC/TSX], just before the new year, in time to experience a quick triple. This time, I was quick to take partial profits, seeing as there were no tax consequences. Many advisors suggest getting back your cost base, which I did; then you can sit back and watch it run, playing with the houses money.

My third experiment was inspired when Mampilly started to recommend his readers move from the ethereum-tracking ETHE trust to actual native ethereum, or ETH. He suggested buying actual native crypto from places like Coinbase and Robinhoodconvenient for his mostly American subscribers, but less so for Canadians.

I discovered that Canadian company Wealthsimple had launched a way to buy native bitcoin and ethereum:Wealthsimple Crypto. Since I now had some bitcoin through the registered 3iQ funds, I put a few thousand into Wealthsimple Cryptos ETH. This is conveniently accessed as a mobile app and is easy to fund from Canadian financial institutions. However, I soon learned there was not yet a way to hold these two Wealthsimple cryptos in registered accounts, so I was back to the taxable dilemma. Soon enough, I learned that 3iQ not only had a bitcoin fund but also an ethereum fundThe Ether Fund [QETH.U/TSX], which was a way to again hold ethereum, like the Bitcoin Fund, in registered accounts.

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How to invest in cryptocurrency (without losing your shirt) - MoneySense

Liberal rift deepens over bill banning gay conversion therapy – The Age

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The bill is intended to criminalise gay conversion practices, meaning psychiatrists, counsellors or people of faith who intend to change or suppress a persons sexual orientation or gender identity could face a fine of up to $10,000 and 10 years in prison if their actions caused serious injury.

The gay conversion therapy bill has exposed fissures within Opposition Leader Michael OBriens party room.Credit:Joe Armao

While the majority of shadow cabinet members supported the plan, three MPs who were in the meeting told The Age that Forest Hill MP Neil Angus argued against the decision to support the ban, citing concerns from religious groups. Mr Angus position has support from a handful of upper house colleagues who told colleagues they would cross the floor if they were denied a free vote.

Muslim and Catholic community leaders joined forces to take out newspaper advertisements on Tuesday to express profound concern about the bill.

Unfortunately, this bill doesnt just ban outdated and insidious practices of coercion and harm, which we firmly reject, Islamic Council of Victoria president Mohamed Mohideen says in the advertisement.

This bill also criminalises conversation between children and parents, interferes with sound professional advice, and silences ministers of religion from providing personal attention for individuals freely seeking pastoral care for complex personal situations.

It includes ill-conceived concepts of faith and conversation, vague definitions and scientifically and medically flawed approaches.

The legislative council is scheduled to debate the bill on Thursday. It is expected to pass with the support of the Labor government and crossbench MPs Fiona Patten, Samantha Ratnam and Andy Meddick.

Justice Party MPs Tania Maxwell and Stuart Grimley, as well as Liberal Democrats MPs Tim Quilty and David Limbrick, have revealed in recent days they will oppose the bill.

Opposition Leader Michael OBrien, while publicly insisting on Monday his party harboured only technical concerns about some parts of the bill, has struggled to bridge the gap between his partys most conservative MPs and the rest of the party room.

The problem isnt with banning gay conversion therapy, because I dont know anybody who supports that, he said.

We can get this done. We can get gay conversion therapy banned, which I think everybody supports, but lets do it in a way that doesnt have a whole lot of unintended consequences.

A party room meeting late last year to settle the oppositions stance on gay conversion therapy laws resulted in a decision to withhold a public position, which allowed the bill to pass the lower house.

If a similar position resulted from Tuesdays meeting, it would cause significant tension among MPs who want the party to strongly denounce gay conversion therapy, according to two Liberal MPs who commented on the condition of anonymity because they were not authorised to discuss internal matters.

Any delay, even technical, is a ruse to cover up for the actual opposition in the party room. Its a tactic, said one MP.

Attorney-General Jaclyn Symes: These views wont be tolerated in Victoria, and neither will change or suppression practices.Credit:Joe Armao

More than 30 religious leaders from such faiths as Christianity, Islam, Judaism and Hinduism have written to Premier Daniel Andrews expressing strong and unequivocal opposition to the bill.

Catholic Archbishop Peter Comensoli will lead a religious prayer walk against the proposed laws on Tuesday. He is expected to be joined by Conservative Liberal MP Bernie Finn, who is one of the MPs expected to oppose the bill.

Attorney-General Jaclyn Symes said: LGBT people are not broken and they do not need to be fixed. These views wont be tolerated in Victoria, and neither will change or suppression practices.

We consulted closely with survivors, LGBTIQ+ organisations and religious organisations on the legislation to make sure it is effective in stamping out abhorrent change and suppression practices once and for all.

The new laws strike the right balance between protecting people from the serious harm caused by change or suppression practices, while respecting the rights to freedom of speech and freedom of religion.

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Writing in an opinion piece for The Age, crossbench MP Andy Meddick, who describes himself as the proud father of two transgender children, argued in support of the criminalisation of gay conversion practices.

My children are perfect. They do not need fixing. Nor do any other children or adults who do not fit an often religiously held belief that gender is binary only, he wrote.

The role of anyone, be they a parent with religious beliefs, an institution, anyone, when someone comes before them and tells them who they are, is to say: I love you, I see you, how can I support you? There is no other answer.

Queensland and the ACT have already outlawed conversion therapy, but the Victorian bill goes further, also targeting prayer-based practices that attempt to change or suppress sexuality or gender identity.

In 2018 a branch of the Victorian Liberal Party linked to conservative federal MP Kevin Andrews, who recently lost a preselection battle for his seat of Menzies, pushed for the party to debate whether the Health Act should be amended so that health practitioners could offer counselling out of same-sex attraction or gender transitioning to patients who request it.

Then state party president Michael Kroger had the motion pulled from the agenda of the partys state conference.

Our Morning Edition newsletter is a curated guide to the most important and interesting stories, analysis and insights. Sign uphere.

Annika is state political editor for The Age.

Sumeyya is a state political reporter for The Age.

Michael is a state political reporter for The Age.

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Liberal rift deepens over bill banning gay conversion therapy - The Age

Walsh declares snow emergency ahead of storm that could drop more than a foot on Boston – The Boston Globe

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Snowfall predictions were creeping up throughout the day Sunday.

As were getting closer to the event, our confidence has grown that the rain-snow line will stay south enough where we will get some more of those high-end snow totals, said weather service meteorologist Rob Megnia.

The potential for the heaviest snow is looking to be in the Worcester Hills area where we could possibly see 18 inches or more, he said. Closer to the coast is more like 8 to 12 inches.

Walsh declared a snow emergency in the city through Tuesday afternoon with a parking ban set to take effect Monday at noon.

Our Public Works Department will be working around the clock to pre-treat and clean our roads, and I thank them for their hard work, Walsh said in a statement. We are asking residents and businesses to do their part by staying safe, shoveling their sidewalks and walkways, clearing catch basins and the area around fire hydrants, and by offering help to your older neighbors and residents with disabilities.

Boston Public Schools announced Sunday that all buildings will be closed Monday and Tuesday and students will attend classes online with early dismissal. BPS meal sites are open Monday from 10 a.m. to 2 p.m.

Governor Charlie Baker has ordered non-emergency executive branch state employees to not report to their workplaces Monday, and he asked residents to avoid going out if they can.

Driving tomorrow will be hazardous due to the high winds and snow in the forecast, so we are asking everyone to stay off the roads, avoid traveling if possible and to use public transportation if they have to go out, Baker said in a statement.

RMV customer service centers will close at noon on Monday. The Steamship Authority warned Sunday that wind gusts could disrupt the service of ferries to Nantucket and Marthas Vineyard.

Forecasters expect hazardous road conditions Monday during the afternoon and evening commute, and a coastal flood watch is also in effect beginning Monday at 1 p.m.

The Massachusetts Department of Transportation will impose a ban prohibiting tractor-trailers from traveling on Interstate 90 beginning at 10 a.m. Monday. Connecticut and Rhode Island are also banning travel by tractor-trailers beginning at 5 a.m., according to Jonathan Gulliver, highway administrator for MassDOT.

Massachusetts State Police may also impose a 40 mph speed limit on Interstate 90 between specific interchanges if conditions warrant, the governors office said.

Gulliver said he expects trucks will begin spreading salt on the highways in some areas of the state about 10 a.m., and soon after that the plows will be put to work.

With this kind of intensity, you hit a point where salt cant keep up and you go to the plows, he said. With this storm, I think well go right to the plows really quickly.

The Department of Transportation has approximately 3,900 pieces of state and vendor equipment available for snow and ice operations, the governors office said, including 1,400 plow and spreader combos, 2,100 plows, and 460 front-end loaders.

Those trucks will be out in full force Monday, Gulliver said, and he hopes people will avoid venturing out if they can.

Messy roads arent his only concern. With heavy wind gusts in the forecast, Gulliver said travelers will likely have a hard time seeing whats in front of them as the storm ramps up.

Were really encouraging people who work remotely that [Monday] is a great day to do that, he said. If people have to be on the road, do what you can to be off it by noon. Were concerned about that time frame when things are at full peak with limited visibility and slippery roadways.

The storm reached the mid-Atlantic on Sunday and is expected to drop at least half a foot of snow from Washington D.C. to Maine by Wednesday morning, the weather service said.

Its packing a punch, said weather service meteorologist Kristie Smith. Its affecting a lot of people.

In Massachusetts, the snow is expected to be wet and heavy and could be accompanied by wind gusts of 40 miles an hour in Boston and as high as 60 on the Cape and Islands, forecasters said.

The most snow is likely to fall in the Metrowest area in a band running through Framingham and Wayland up through Middlesex County, according to Smith.

The storm could bring minor coastal flooding and scattered power outages, particularly with higher wind gusts on the Cape, she said.

Although precipitation will almost certainly start as snow in Boston, there is a chance it will turn to rain at some point Monday, depending on the exact track of the storm, Smith said.

Its a tricky system, she said.

The workweek is expected to bring some relief from the weekends bitter cold, which saw temperatures fall to single digits overnight, according to the weather service.

After a low of 7 degrees in Boston Sunday morning, temperatures increased into the 20s in the afternoon, forecasters said. Mondays temperatures are expected to climb into the 30s.

The impending storm may bode well for an early spring, at least if groundhogs are to be believed.

Groundhog Day predictions will be coming Tuesday morning, and cloudy days when groundhogs cast no shadow traditionally prophesy a shorter winter.

But Renata Pomponi, who oversees Massachusetts official groundhog at Mass Audubon Drumlin Farm in Lincoln, said it could easily go either way this year when Ms. G goes live on Facebook at 10 a.m.

One of the things we New Englanders love about nature in our region is the unpredictability of the weather, and this year will be no exception, she said.

Enough sun can sometimes peek through the clouds to cast a shadow, so it is always an up-to-the-minute situation as to what her prediction will be.

Lucas Phillips can be reached at lucas.phillips@globe.com. Nick Stoico can be reached at nick.stoico@globe.com. Follow him on Twitter @NickStoico.

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Walsh declares snow emergency ahead of storm that could drop more than a foot on Boston - The Boston Globe

Yes, bitcoin could be the new GameStop – CNBC

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It has been a volatile few months for bitcoin.

On Friday alone, the cryptocurrency briefly shot 20% higher after billionaire Tesla founder Elon Musk changed his Twitter bio to "#bitcoin."

Though it quickly gave up those gains, there are parallels between bitcoin's swift move higher and the GameStop stock mania, which continues to dominate the global news cycle.

The battle of hedge-fund short sellers versus retail traders who are coordinating on social media to drive the price higher could be a sign of what's to come for the world's biggest cryptocurrency.

Data from crypto news and analysis company The Block shows that hedge funds are short bitcoin by more than $1 billion.

That term "shorting" means that traders and hedge funds are betting that the price of bitcoin will go down. Those short positions ramped up starting in October 2020, just as bitcoin's latest rally began to take hold.

Meanwhile, individual investors are still buying into bitcoin, among other cryptocurrencies, as they bet that the price will go up.

Sound familiar?

Retail brokerages including Robinhood have extended trading restrictions on stocks such as GameStop, and as of Friday, the trading app is also limiting trading in cryptocurrencies.

Unlike GameStop, a brick-and-mortar mall business that was closing stores even before the pandemic led to widespread shutdowns, analysts say the fundamentals underlying bitcoin tell a more promising story.

Analysts at JPMorgan think the price of bitcoin could rally as high as $146,000, and the global head of CitiFXTechnicals says the charts signal that bitcoin could reach $318,000 by December.

Part of what's different about bitcoin's rally in 2020 versus its last run higher, in 2017, is that institutional investors are now adopting bitcoin, lending it newfound legitimacy and helping to erase the reputational risk of investing in the cryptocurrency.

"We've seen the majority of folks like insurance firms, asset managers, hedge funds and corporate balance sheets come into the market in 2020," said Michael Bucella, general partner at crypto firm BlockTower Capital.

The surge in interest from mainstream financial players hasn't just reformed bitcoin's image, it's also fomented a supply shortage.

"There is a large and emerging group of institutions that have an enormous capital base that are reallocating to this space," Bucella said. "And if you think about the supply-demand model of a commodity, the supply curve is declining over time to effectively zero, and the demand is increasing exponentially."

There will only ever be 21 million bitcoins in existence, because, like other cryptocurrencies, it was built around the principle of a finite supply. The total number of mined bitcoin is at roughly 18.6 million, so it's nearing its maximum threshold.

And that interest from institutional investors doesn't appear to be slowing down.

"There's a lot of demand, and there's not enough supply of bitcoin for every financial institution to have their own reserve to serve their clients," said McKenzie Slaughter, a member of the Black Women Blockchain Council.

The GameStop saga has been driven by a large group of Reddit day traders, at least some of whom are motivated by wanting to stick it to Wall Street. They coordinated online to pile into GameStop in order to drive the price of the stock higher, with the specific purpose of causing hedge funds to lose money.

That same underlying anger and frustration over how institutional investors make profits has also played a role in bitcoin's rise. A big part of the cryptocurrency's intrinsic value is derived from the fact that it isn't tethered to any one governmentnor is it pegged to other currencies.

Investing in an independent cryptocurrency such as bitcoin, therefore, means you are putting your money toward a technology and a currency that could one day replace the modern financial system. This is certainly not lost on retail traders looking for the ultimate way to cut institutional investors out of the equation.

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Yes, bitcoin could be the new GameStop - CNBC

This Is Why Bitcoin Will Hit $59,000 In 2021 – Entrepreneur

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Seven compelling factors that are driving Bitcoin higher.

Let the business resources in our guide inspire you and help you achieve your goals in 2021.

February1, 20216 min read

As technical as cryptocurrency and Bitcoin (BTC) markets are there are some fundamentals driving the market. These include cryptocurrencys growing mainstream acceptance, the amount of power put into mining the coin, and its availability to name a few. Now that BTC/USD is trading at new all-time highs the market can expect the bullish trends to continue because there isnt much reason for the market to reverse until a clear top is formed. Based on what were seeing inthe marketBTC/USD could easily hit the $59,000 this year and that estimate might be too low.

Related:How a Series of Elon Musk Tweets Helped Lead Investors to Dogecoin, a Meme-Inspired Cryptocurrency Worth 4 Cents

1. There is a cost to mine Bitcoin

While mining Bitcoin used to be very easy, an influx of miners (along with other factors discussed below) drove up the difficulty rate while driving down the reward. Now it is virtually impossible for a lone operator to mine a single BTC without the help of either 1) a vast quantity of expensive mining resources or 2) the aid of a mining pool. The mining pools tend to operate where electricity is cheap but there is still cost, not to mention the overhead of running a large mining operation. The latest estimates put the cost of 40 TH/s of computing power at $4.32 per day. Thats may seem small but it adds up over the year. The annual cost runs about $1,576 with an expected reward of 0.08875 Bitcoins or about $3,017 with BTC trading at $34,000. Thats a gross margin of 47% and then add in the cost of buying or renting a unit. The takeaway, it costs money to mine Bitcoin and that is where a lot of its intrinsic value lay.

2. There is not an unlimited supply

Bitcoins value is also driven in large part by supply, and the supply is dwindling. There are only ever going to be 21 million real BTCs ever minted. That doesnt count wrapped BTC or other kinds of defi-sourced BTC which ultimately will also affect BTCs price. But, back to the supply, of the 21 million nearly 90% have already been mined leaving just over 2 million for the mining community to split up. And, not only that, but there are the halvings to consider. A halving is when the Bitcoin mining reward is cut in half. The purpose of this is to help control BTC inflation and extend the lifespan of the mineable BTC pool. The halving occurs every four years, there have been three so far, and the most recent was just this past year. The takeaway here, people who want to own a Bitcoin or use a Bitcoin have to buy one of the few that are already out there.

3. There are a growing number of BTC addresses

Technically, the way that the BTC network is set up, there are already an infinite # of addresses. The system is set up that way to help make it more difficult to find a specific address and hack into it. The more important figure, however, is the number of Bitcoin wallets that currently hold BTC >0. That figure posted a YOY increase in 2020 that has the total number of wallets in use at over 1 million. That doesnt sound like a lot but you have to remember that supply is limited and the number of large holders and whales is rising by mid-single-digits. The number of whales, BTC holders with over 1000 BTC in their account rose by 7% while smaller accounts with 5 to 100 BTCs rose by 4%. In total, BTC whales are holding nearly 2.3 million BTCs while smaller investors account for upward of 10 million BTC. Thats not a lot left for the truly small retail investors who are also flooding into this market.

4. The mining community is still growing

If Bitcoin wasnt an attractive and lucrative investment the mining community would not be growing and it is growing. The latest data shows hashing power or the amount of computing power attributed to the BTC network at a new all-time high. The takeaway here is that Bitcoins hashing power has only risen over the long-term and is likely to continue setting new highs long into the future. Thats a lot of competition for a dwindling supply of coins.

5. Bitcoin is the worlds reserve cryptocurrency

Bitcoin has long been the worlds reserve cryptocurrency because its the easiest to use, themost widespread, the first that most new users buy, and its role in defi. The proof of this is in the coins market dominance of its percentage of the total cryptocurrency market cap. Except for a brief period during 2017 and 2018 when the Altcoin craze was going on Bitcoin has always commanded at least 50% of the total market cap. Lately, that has risen to over 60% where it has trended since mid-2019. The takeaway here is that when the world turns to crypto Bitcoin is the first name they seek. And the world is warming up to crypto.

6. Bitcoins get lost, locked, and burned every day

As if the limited and dwindling supply was not enough to support BTCs price movement there is the lost BTCs to consider. The estimates vary but investors should assume that roughly 3.7 million BTCs are already lost or irrecoverable. One analyst estimates that 1,500 BTCs are lost every day. What lost means is that they are in unrecoverable wallets. We know where they are on the blockchain but no one can get to them for 1 of 2 reasons. The first is that they are really lost due to password protection and/or lost devices. Those coins will never come back to the market. The second is burning. Some operations on blockchains require you to lock or burn coins. This essentially loses coins on purpose but in a way that spawns new value. For example, if we wanted to launch our own cryptocurrency we could burn $1 million worth of BTC and produce 1 million $1 MarketBeat Coins.

7. Defi is growing

Defi isdecentralized financewhich, in a nutshell, means locking BTC or another cryptocurrency into a smart-contract. The total value of defi grew at an exponential pace in 2020 and now amounts to over $27 billion in value. Thats not all BTC value but BTC is well-represented. The takeaway here is that defi is growing and will continue to suck up BTC value and drive demand for BTC.

After a strong rally from the 2020 lowws the Bitcoin market is very bullish. BTC is likely to move sharply higher over the next year and basied on the recent move, it could run close to 100%. Assuming the recent consolidation at all-time-high levels will lead to a continuation we project at least $27,000 in upside from the $32,000 level.

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This Is Why Bitcoin Will Hit $59,000 In 2021 - Entrepreneur

Behind the Bitcoin Bubble – The Wall Street Journal

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To figure out if youre in a bubble, you need to find the source of the hot air. Obvious for GameStop , but for bitcoin, not so much.

In July 2018, we wrote about the cryptocurrency company Tether, which issues tokens called tethers that trade under the symbol USDT and should be valued at $1making the currency a stablecoin. Tethers creators might have manipulated bitcoin, a University of Texas paper suggests, by issuing tokens willy-nilly unbacked by real dollars and then buying bitcoin to jack up its price. (The company claims the research is flawed.)

At the time, Tethers total value was some $2.7 billion, and its website claimed: Every tether is always backed 1-to-1 by traditional currency held in our reserves. So somewhere there should have been $2.7 billion in real moneythats how a stablecoin is supposed to work. In November 2018, New York state Attorney General Letitia James invoked the Martin Act to begin an investigation into iFinex, which owns Tether and the Bitfinex cryptocurrency exchange, in connection with ongoing activities that may have defrauded New York investors. The company has disputed the attorney generals claims, denied it misled customers, and said it will fight any action. An appellate court last year rejected its challenge to the probe.

Bitcoin peaked at the end of 2017 at $19,000 and over the next year collapsed to $3,200. Welltheyre baaack! On Friday Elon Musk was the latest to pump Bitcoin, which briefly reached almost $38,000. And there are now some $26.4 billion of USDT tokens, $18 billion of which were created since March 2020. Why the increase? No one has a good explanation.

All that glitters is not gold. In 2019 Tether subtly updated its claim to say reserves may include other assets and receivables from loans made by Tether to third parties. Tether has even admitted it only has 74% of the cash or cash equivalents to back its stablecoin. Hmmm. Basically unbacked.

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Behind the Bitcoin Bubble - The Wall Street Journal

This investor in both gold and bitcoin says only one offers real long-term safety – MarketWatch

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Spoileralert: I own both gold and Bitcoin in my portfolio.

As a longtime participant and observer of the shifting currents of monetary policy and financial markets, I believe both can play vital roles as repositories of value, especially in a world plagued by economic and political uncertainty.

But although they share some similarities, there are important differences that persuade me that contrary to growing opinion, bitcoin BTCUSD, +3.55% will not supplant gold GC00, -1.73% as the choice of investors seeking long-term safety.

Admittedly, bitcoin advocates have some momentum on their side, as its price hit a record above $40,500 in early January. After a recent pullback, bitcoin still trades around $30,000. Prominent institutional investors have become bitcoin fans; BlackRock, the worlds largest money manager, called it a durable mechanism that could take the place of gold to a large extent.

Yet, to paraphrase Mark Twain, the reports of golds demise have been greatly exaggerated. Bitcoin is certainly a legitimate asset and has the potential to be a true store of value joining a select group of assets, commodities and currencies that can be saved, retrieved and exchanged without deteriorating in value.

However, gold has at least a 2,500-year head start as a widely-accepted, global medium of exchange and value. Compared to bitcoin, the gold market enjoys great depth and liquidity. The total amount of physical gold held by investors and central banks is an estimated $3.7 trillion. Thats nearly seven times the market capitalization of all bitcoin created. Both gold and bitcoin enjoy highly liquid markets, but golds average daily volume in 2020 was $125.3 billion, or 30 times bitcoins daily spot volume of $4.1 billion.

I own gold for insurance to offset the effects of inflation and as a safe haven to offset any steep losses in other parts of my portfolio. Bitcoins role in my portfolio is that of a speculative asset, rather than to protect wealth. I became interested while I was director of the U.S. Mint and wanted to understand cryptocurrencies, and the best way was to try it. Since leaving government service, I have become an investor in bitcoin.

While both gold and bitcoin can be seen as islands of security in an ocean of financial turbulence, we must understand their similarities and significant differences.

In both cases, their value is supported, in part, by scarcity. Gold is limited by physical supply and the difficulty of extraction, while bitcoin creation is capped at 21 million by its source code. These qualities, as well as the deep, liquid markets I noted earlier, mean that both gold and bitcoin have the potential to retain value, and in fact appreciate, during difficult economic cycles.

And unlike government-made currencies like the U.S. dollar, whose value derived from confidence in the issuing government and laws requiring citizens to accept it, gold and bitcoin have other uses, and the markets generally determine their value.

Gold, however, has an unmatched long-term record as a store of value. Economists have shown that, over the past 50 years, gold more than held its own in times of low inflation and rallied strongly during periods of high inflation. Since bitcoin has only existed since 2009 and its active trading market is even more recent, it is too soon to tell how its value will hold up over time.

The differences between gold and bitcoin are meaningful. For one, bitcoin is volatile, having fallen more than 20% from its Jan. 8 high. Over the same period, gold declined about 3%. This lack of volatility is one reason investors gravitate toward gold.

The run-up in bitcoin over the last year may largely be due to a new class of investors, attracted to a more transparent regulatory environment. Many new bitcoin owners are institutions, including private-equity firms, hedge funds, insurance companies, pension funds and endowments. Once this initial institutional surge of buying normalizes, bitcoins price escalation may not be sustainable.

Another advantage of gold is that one can take physical delivery, while digital currency exists as an electronic ledger entry. Weve heard about the British investor claiming to have accidentally thrown away a hard drive containing a cryptographic key to about $300 million in bitcoin that may now reside in a trash dump in South Wales. Its hard to imagine misplacing that amount of gold coins or bars. By holding physical gold, the investor owns its full value and has no counterparty risk.

Furthermore, despite expectations that Bitcoin would be used for everyday transactions, that degree of wide acceptance has not yet occurred. Bitcoin is more likely to be used as money in countries where there is little confidence in government currency and will take longer to be widely accepted as money in economies where government money is generally trusted, like in the U.S., Japan and across Europe.

While these differences explain why bitcoin wont entirely replace gold, both make sense in a well-managed portfolio. The continuing economic uncertainties wrought by COVID-19, the lower-for-longer interest rate policies of central banks, and the volatility of the highly valued equity market make a strong case for owning assets whose value is not tied to economic vagaries or government policies.

As an investor, why should I have to choose between the two? I think there advantages to owning both.

Edmund C. Moy was the 38th director of the United States Mint and is now chief market strategist at Valaurum, a company that enables investors to buy gold in small, more affordable increments.

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This investor in both gold and bitcoin says only one offers real long-term safety - MarketWatch

As Bitcoin Remains Muted, Traders Find Time To Eat Sushi – Benzinga

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Bitcoin is struggling to find momentum even as Tesla Inc (NASDAQ: TSLA) CEO Elon Musk expressed explicit support for the world's apex cryptocurrency on Monday.

What Happened: Bitcoin traded mostly unchanged over 24 hours at $33,670 at press time late Monday, retreating from the above $38,000 levels it was trading at last week after Musk initially updated his Twitter bio to #Bitcoin.

The cryptocurrencys gains are outshined by a decentralized finance, or DeFi, cryptocurrency.

SushiSwap (SUSHI) traded about 32% higher at $13.43 at press time. The cryptocurrency has surged about 61.4% against the U.S. dollar over the past seven days and 281% over 30 days, as per data from Messari.

It outshines Bitcoin, up 1025.9% against the apex cryptocurrency over a period of 90 days.

Among other Defi coins, Uniswap (UNI) has surged 13.2% to $19.74 over 24 hours.

Aave (AAVE), another DeFi coin that has added 211.7% gains over 30 days, is down 2.5% to $290.49 at press time.

Ethereum (ETH) cryptocurrency, which supports the primary blockchain platform associated with DeFi projects, is up 5% at $1,387.30.

Why It Matters: DeFi cryptocurrencies have been seeing momentum over the past month as total value locked (TLV) in such projects increases. According to DeFi pulse, the TLV for overall DeFi projects has increased to $27.68 billion as of press time.

SushiSwap, the DeFi project supported by the SUSHI cryptocurrency, has a TLV of $2.34 billion.

SushiSwap's share of the decentralized-exchange market is also increasing rapidly, as per Dune Analytics data. The SushiSwap trading volume made up for 23.3% of the DEX market at press time. UniSwap has a DEX trading volume market share of 48.9%.

2021 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.

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As Bitcoin Remains Muted, Traders Find Time To Eat Sushi - Benzinga

OKEx to integrate the Bitcoin Lightning Network, enabling cheaper and faster transactions for users – PR Newswire India

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VICTORIA, Seychelles, Feb. 2, 2021 /PRNewswire/ -- OKEx (www.okex.com), a world-leading cryptocurrency spot and derivatives exchange, is thrilled to announce the integration of the Bitcoin Lightning Network, a second-layer scaling solution based on the Bitcoin blockchain, in the coming quarter. This major development will dramatically decrease transaction fees and times, improving user experience on the exchange. Lightning integration also highlights OKEx's deep commitment to deep commitment to bringing the most advanced Bitcoin technology to the world and furthering the development of the Bitcoin ecosystem.

Originally proposed by Joseph Poon and Thaddeus Dryja in 2015 as a Layer 2 scaling solution, the Lightning Network is a decentralized network that uses smart contracts on Bitcoin's blockchain to facilitate instant payments across the network. An off-chain scalability solution to Bitcoin's network congestion, the Lightning Network acts as a payment protocol on top of the Bitcoin blockchain, routing payments through participating nodes through a peer-to-peer system that greatly reduces transaction fees and times.

As BTC adoption becomes increasingly widespread and more users interact with the Bitcoin blockchain, the cost of transactions rises significantly, while transaction speed is greatly reduced. Currently, the average BTC on-chain fee is more than $10 and takes between 10 to 30 minutes to complete, discouraging many users from interacting with the network. Integrating Lightning with the OKEx platform will allow users to send and receive BTC in near real-time at next-to-no cost.

As OKEx becomes a participant node in the Lightning Network, users will be able to select the Lightning Network option when depositing and withdrawing BTC.

"OKEx is extremely proud to be one of the first major exchanges to integrate the Lightning Network. We are always looking for new ways of decreasing user transaction fees and times. By integrating Layer 2 payment protocols like the Lightning Network, we can offer more competitive products to our users and, at the same time, openly demonstrate our support for the Bitcoin network by increasing the number of participant nodes in the Lightning Network," commented OKEx CEO Jay Hao.

"OKEx's Lightning integration marks a big step for its users and the bitcoin community as a whole, enabling instant, global, low fee transactions. OKEx's leadership in adopting Lightning will help bring bitcoin to the next billion people around the world," said Elizabeth Stark, CEO and Co-Founder at Lightning Labs.

About OKEx

A world-leading cryptocurrency spot and derivatives exchange, OKEx offers the most diverse marketplace where global crypto traders, miners and institutional investors come to manage crypto assets, enhance investment opportunities and hedge risks. We provide spot and derivatives trading including futures, perpetual swap and options of major cryptocurrencies, offering investors flexibility in formulating their strategies to maximize gains and mitigate risks.

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http://www.okex.com

SOURCE OKEx

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OKEx to integrate the Bitcoin Lightning Network, enabling cheaper and faster transactions for users - PR Newswire India

Bitcoin miners raked in more than $1 billion in revenue last month – Techradar

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Mining bitcoin is finally profitable again as new data has revealed that miners were able to bring in $1.09bn in revenue last month.

This is significant due to the fact that bitcoin revenue in January reached its highest point since December of 2017 before the cryptocurrency bubble crashed later that month.

At the same time, the revenue for bitcoin miners in January of 2021 also surpassed the level seen during the same time period in 2018 when miners were able to rake in $1.02bn. However, both last month and January 2018 failed to surpass the monthly revenue of $1.25bn for bitcoin miners recorded during December 2017.

Of the over $1bn in revenue made from mining bitcoin last month, $977m came from the network's block subsidies. These block subsidies increased sharply as the cryptocurrency's price jumped above $30k to reach a high of $42k.

Mining bitcoin has also become more expensive recently due to a bidding war for the latest ASIC mining equipment including Bitmain's AntMiner S19 Pro and S19. According to The Block, some customers who preordered the latest ASIC machines due to be delivered last month tried to resell them at premiums of at least 75 percent.

The supply shortage coupled with bitcoin's recent rise lead to miners' daily revenue per each terahash second (TH/s) of computing power increasing to as much as $0.25 which has not been seen since mid-2019.

If you have an unused bitcoin mining rig lying around, now may be the perfect time to fire it up again.

Via The Block

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Bitcoin miners raked in more than $1 billion in revenue last month - Techradar


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