Daily Archives: December 21, 2020

Bitcoin has broken fresh ground this week, climbing above $20,000 per bitcoin for the first time ever and grabbing global attention again three years after bitcoin's 2017 boom and subsequent bust.

The bitcoin price is up around 30% over the last month, adding to gains of more than 200% since Januaryand pushing up other top five cryptocurrencies by value ethereum, Ripple's XRP, and litecoin.

Ethereum, Ripple's XRP, and litecoin, some times known as alt coins, have all soared by more than 30% over the last 30-day period, with the likes of smaller cryptocurrencies cardano, NEM and stellar making even bigger gains.

The bitcoin price has shot above $20,000 this week, climbing as high as $23,780 on the ... [+] Luxembourg-based Bitstamp exchange before falling back slightly.

"While bitcoin has largely dominated the narrative, I believe investors should look to alt coins who have tremendous amounts of development in both the core technology and usership, yet are still a fair way off their all-time highs," Nicholas Pelecanos, head of trading at NEM, which developed NEM's XEM digital token, said in emailed comments.

"Does this leave these alt coins undervalued against bitcoin? I believe it does and am expecting to see the price of these alt coins, such as ethereum and XEM, rally hard when the bitcoin price inevitably slows down."

Many smaller cryptocurrencies are closely tied to the bitcoin price, with moves higher and lower triggered by bitcoin developments and sentiment. However, alt coins often swing by much bigger percentages, often losing or gaining double and even triple digit percentages in mere days.

Cardano, a top ten cryptocurrency, has added around 70% over the last month. Two top 20 cryptocurrencies, NEM and stellar, have more than doubled in price over the last 30 days, as bitcoin puts cryptocurrencies back in focus.

Bitcoin's reputation as digital gold has grown this year, gaining as investors fret over the possibility of increased inflation and helped on by a number of big-name investors who have publicly named bitcoin as an emerging inflation hedge.

Bitcoin's jump higher this week came after news fund manager Ruffer Investment Management moved around $750 million of its clients' money into bitcoina move designed to "primarily a protective move for portfolios" to "act as a hedge" against "some of the risks that we see in a fragile monetary system and distorted financial markets," a Ruffer spokesperson told bitcoin and crypto news website Coindesk.

Ahead of bitcoin's surge over $20,000, many smaller cryptocurrencies, such as ethereum and XRP, were already soaring as investors eyed technical developments and token giveaways.

XRP, a digital token developed by Ripple, made huge gains through November ahead of a hotly-anticipated giveaway of a new cryptocurrency, known as an airdrop. Ripple controls around 60 billion of the 100 billion XRP tokens that will ever be created.

The XRP price has fallen back slightly since it peaked late last month but its currently up by around 90%.

The bitcoin price has surged to fresh all-time highs this week, climbing well above $20,000 per ... [+] bitcoin after brushing the psychological barrier three years ago.

Meanwhile, ethereum, the second-largest cryptocurrency after bitcoin, is up by 32% over the last 30 days. Investors began piling into ethereum over the summer amid a surge of interest in decentralized finance (DeFi)using crypto technology to recreate traditional financial instruments such as loans and insurance.

Ethereum's blockchain is used as rails by many DeFi projects and some investors think the ethereum price will benefit as DeFi's popularity rises. Ethereum was given a further boost by the closely-watched launch of ethereum 2.0 last month.

Litecoin, some times known as the silver to bitcoin's gold, has this week climbed to its highest price since for 16 months, up around 40% on its price 30 days ago. However, litecoin is still far from its all-time highs set in late 2017, down some 75%.

The bitcoin and cryptocurrency community has been quick to talk up bitcoin's 2021 prospects despite its recent sky-high gains, with many pointing to PayPal's PYPL recent support of bitcoin and a handful of other cryptocurrencies and similar digital infrastructure development as potentially supporting the bitcoin price going forward.

"We are only in phase one of the bull-run," Pascal Gauthier, the chief executive of France-based bitcoin and cryptocurrency physical wallet maker Ledger, said via email. "Many big players are investing time and resources to build or buy digital asset infrastructures needed to support the swell of institutional and retail adoption."

Continued here:
Massive Bitcoin Gains Are Being Dwarfed By Ripples XRP, Litecoin, Ethereum And These Minor Cryptocurrencies - Forbes

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Bitcoins price is more than 50% higher than its fair value of about $12,000.

Thats one of the implications I draw from a new analysis of the various valuation frameworks for determining the cryptocurrencys fair price. Entitled Bitcoin Is Exactly Like Gold Except When It Isnt, the analysis was conducted by Claude Erb, a former commodities portfolio manager at TCW Group.

I first wrote about Erbs analysis of precious metals in a February 2013 column for Barrons. His conclusion at the time, reached jointly with Campbell Harvey, a finance professor at Duke University, was that golds fair value was less than half its then-current price.

Gold fell by $600 an ounce over the subsequent 2 years. That alone inclines me to pay close attention to what he is now saying about Bitcoin.

This cryptocurrency has been on a tear of late, with a year-to-date gain of 170%. In recent days, in fact, Bitcoin has risen to new all-time highs, eclipsing its prior high set in late 2017.

The valuation framework that concludes Bitcoins fair price is about $12,000 is based on the thesis that its value derives from whats known as a network effect. That is, a networks value grows faster than the number of connected users. (This framework is related to whats known as Metcalfes Law, which holds that a networks value grows according to the square of the number of users.)

To test the explanatory power of this network-effect framework, Erb made the simplifying assumption that each Bitcoin that has been mined represents one user in a Bitcoin network. He then calculated the way that the price of Bitcoin has traded relative to the number of Bitcoins that have been mined up to that point. As you can see from the accompanying chart, his model does a good job of capturing Bitcoins price rise over the past decade.

According to this model, Erb said in an interview, Bitcoins fair price as of Dec. 14 is $12,315. Bitcoins actual Dec. 14 price of $19,201 is 56% higher.

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Of course, a social-network framework is not the only way in which analysts have proposed calculating Bitcoins fair price. Erb nevertheless suggests we give it serious consideration because no other relative valuation approach is empirically more plausibleand the predictions of the social-network framework are impressively correlated with the trajectory of Bitcoins price history.

Using the social-network framework to value Bitcoin also allows us to forecast how much it will rise in the future. Thats because its underlying code stipulates both the maximum number of Bitcoins that will ever exist (21 million) as well as how quickly they can be mined (this limit isnt likely to be reached until 2140). According to Erbs econometric model, a 21-million-user network translates to a Bitcoin price of $74,000. Relative to its current price, that represents a 1.2% annualized return over the next 120 years.

Some other approaches for valuing Bitcoin contend that its a good inflation hedge. But Erb says those approaches are less empirically plausible than the network effect framework.

He points out that a key precondition for something being a good inflation hedge is that its real, or inflation-adjusted, price is relatively stable. But Bitcoin doesnt satisfy this precondition, at least if we use the consumer-price index as a proxy for inflation. Over the past decade, the ratio of Bitcoin to the CPI has ranged from a low of near zero to a high of over 73.

Bitcoin is even less of a good inflation hedge than gold. Thats relevant because many of Bitcoins supporters argue that it is Gold 2.0. The gold/CPI ratio over the past decade has ranged between a low of around 3 to a high of around 8, and while thats wider than what it should be if gold were a good inflation hedge, its far narrower than the comparable ratio for Bitcoin.

The bottom line? Erbs analysis offers something useful for Bitcoins devotees: a valuation model that can be used to estimate the cryptocurrencys fair value. Its entirely possible that there is another model that does an even better job than his of explaining Bitcoins price history. Meanwhile, Erbs social-network framework introduces a quantitative discipline into an arena that heretofore has been characterized largely by marketing slogans.

Mark Hulbert is a regular contributor to Barrons. His Hulbert Ratings tracks investment newsletters that pay a flat fee to be audited. He can be reached at mark@hulbertratings.com.

Comments? E-mail us at editors@barrons.com

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Why Bitcoin Is Overpriced by More Than 50% - Barron's

Many cryptocurrencies have been developed after the invention of bitcoin, but it is one of the most demanded and appreciated crypto assets. Crypto enthusiasts appreciate both bitcoin and blockchain, and this has inspired a lot of developers to invest time and efforts in developing a cryptocurrency like bitcoin. The bitcoin market is unstable and highly unpredictable, but the rise in bitcoins value has pleased investors and attracted them towards the mining process. To understand more about this digital currency, search bitcoin circuit, and learn about it for trading.

The increasing popularity and value of bitcoin have attracted investors and traders, and undoubtedly businesses and agencies have started accepting bitcoin as a medium of exchange. Still, there are some of the challenges that the bitcoin community needs to overcome, which are as follows:

List of Challenges that must be overcome includes:

Less supportive mobile platform

Undoubtedly many businesses and agencies have started supporting bitcoins, but it is quite shocking to see that the tech-giants companies still do not support bitcoin on mobile platforms. In fact, tech giants like Google and Apply are deciding to ban a bitcoin wallets applications on their App Store. Even after knowing that tech-giants are not supporting bitcoins, some developers are still creating bitcoin wallet applications and harming the economic ecosystem.

The popular and well-renowned companies are not participating in deals of bitcoin. They are a helping hand for the government as they are using their powers in not regulating bitcoin by not providing them a platform. This is quite a challenge for bitcoin users because bitcoin is an outstanding payment method that allows fast and easy transactions. It allows users to easily send and receive bitcoin using mobile wallets instead of going to bank accounts to carry out the transactions.

Dawdling Transactions

The biggest challenge that the bitcoin network is facing is the long time that is taken by the system to process the bitcoin transactions. This prevents businesses from accepting crypto tokens. The challenge of dawdling transaction occurs when the transaction is processed on the blockchain. The average time that a bitcoin transaction takes to get verified is around 43 minutes. The main reason behind the dawdling transactions is the transaction cost fee that is for people who want to get their transactions to verify first.

Users who dont pay the transaction fee need to wait for hours to complete their transactions. For instance, when you go to a retail store to buy something, you pay for that item with bitcoin. The transaction is required to be verified first on the blockchain, and miners do this task. The miners are the specialized computers that use specialized computing power to solve the complicated mathematical algorithms to verify the transactions and mine new coins.

Costly Transactions

The bitcoin transactions are subject to the transaction cost fee, which creates a pending line of transactions. The transactions are implemented according to the transaction fee that is paid to verify the transaction fast. Users who want to complete their transaction need first to pay an extra transaction fee to get it completed. This will, in turn, make the transaction expensive gratuitously. Businesses hesitate to accept bitcoin as a payment method because of the slow and costly transactions it offers. Due to this issue, people are switching to other methods or currencies to complete transactions quickly and easily.

Less privacy

Another major challenge that bitcoin users face is the lack of privacy. Each transaction is recorded on a distributed public ledger, i.e., on the blockchain, making users switch from bitcoin to other cryptocurrencies. People trust bitcoin because they have heard of a misconception that says bitcoin is a private system. But the reality is completely different, and users must understand that the bitcoin network is anonymous but not completely private.

In reality, bitcoin transactions are hashed and not encrypted, and this makes all the transactions available for analysis and public scrutiny. People consider it a privacy concern that must be linked to bitcoin transactions. Many wallets and other projects have reported less privacy, and therefore, it is important to know the wallets and choose the one carefully.

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What are the challenges faced by Bitcoin and its users and need to be overcome? - Blog - The Island Now

Bitcoins ascent above $19,500 was cut short early on Tuesday, possibly due to profit taking by large Asia-based investors, according to one analyst.

The top cryptocurrency fell from $19,555 to $19,035, with most of the drop unfolding during the two hours to 06:00 UTC, according to CoinDesk 20 data.

I think Asian whales sold around $19,500 causing prices to drop, Ki Young Ju, CEO of South Korea-based blockchain analytics firm CryptoQuant, told CoinDesk, referring to those with big crypto holdings. He highlighted an increased inflow of coins onto crypto exchange heavyweight Huobi Global, which has a Hong Kong presence, soon before prices began falling.

A total of 2,013 coins were transferred to Huobi in blocks 661,425 to 661,430 just 15 minutes before the price dip, Ju said, adding that block number 661,425 carried 1,017 coins, the highest single-block inflow on Huobi since Nov. 30.

Monday saw 8,836 BTC arrive on Huobi in total, with a mean transaction of 4.5 BTC, the highest since March 2018, according to CryptoQuant.

Bitcoin inflows on Huobi

The uptick in the average size of exchange deposits indicates that larger investors were transferring their coins to Huobi and may have liquidated their holdings around $19,500, a level which has acted as stiff resistance of late.

Bitcoin has failed multiple times to establish a foothold above that point since Nov. 25, thought to be largely due to some investors booking profits on fears of a near-term sell-off.

At press time, bitcoin has rebounded to near $19,300 and the path of least resistance for the cryptocurrency remains to the higher side, according to analysts.

The options market sees a 35% probability of bitcoin ending December above $20,000, according to data source Skew. Thats significantly higher than the single-digit probability seen three months ago when bitcoin was trading near $10,000. Some investors look to have bought call options at the $20,000 strike price on Monday.

Bitcoin: Daily change in options open interest

Skew data shows the open interest or the number of open positions in the bullish $20,000 call rose by 1,054 contracts on Deribit, the worlds largest crypto options exchange by volume and open interest.

However, forcing a breakout above $20,000 in the short term may prove to be an uphill task for the bulls, as there are sizable sell orders open in the approach to a new record high spot price.

There are still offers above $19,500 up to $20,000, Patrick Heusser, head of trading at the Zurich-based Crypto Broker AG, told CoinDesk. The U.S.-based cryptocurrency exchange Coinbase shows 700 bitcoin for sale right at $20,000, but all other exchanges show some offers up there as well in the region of 200-300 coins.

Link:
Bitcoin May Have Hit Wall of Profit Takers Around $19,500: Analyst - CoinDesk - CoinDesk

Globe Newswire

Dublin, Dec. 21, 2020 (GLOBE NEWSWIRE) -- The "U.S. Steel Merchant and Rebar Market Size, Share & Trends Analysis Report by Product (Merchant Bar, Rebar), by Application (Construction, Infrastructure, Industrial), and Segment Forecasts, 2020 - 2027" report has been added to ResearchAndMarkets.com's offering. The U.S. steel merchant and rebar market size is anticipated to reach USD 14.1 billion by 2027, expanding at a CAGR of 5.2%. The construction segment dominated the market with the highest revenue share in 2019. Construction is one of the largest end-use industries of steel products. As per the World Steel Association, it accounts for more than 50% of the global demand for steel.Various infrastructure and construction sites require massive amounts of steel to enhance the strength of structures. Steel is affordable, easily available, and has various properties including versatility, durability, high strength, and 100% recyclability. Steel rebars have a wide range of applications in infrastructure development and residential and commercial construction sectors in high-rise structures, highways, braces, brackets, and ornamental work.Due to the recent COVID-19 outbreak, numerous businesses and governments were operating at limited capacity in the first half of 2020. However, the construction sector has shown positive signs of recovery in the second half of 2020. For instance, as per the U.S. Census Bureau, completions of privately-owned housing projects increased by 3.6% in July 2020 from the previous month. Similarly, completions of single-family housing projects witnessed a rise of 1.8% during the same period.Rising demand for Fiber-Reinforced Polymer (FRP) rebars is likely to restrain the market growth over the coming years. Corrosion of steel rebars affects the life expectancy of reinforced concrete structures. In some cases, repair costs can be double of the original construction costs. Corrosion leads to faster degradation of reinforced structures, which increases the costs associated with it. To reduce the infrastructure gap, the U.S. government is introducing various investment plans.For instance, in the 2019 budget, USD 100 billion were provided as incentives to prioritize infrastructure maintenance, generation of revenue streams, and modernization of procurement practices. Also, USD 50 billion funds were allocated for the development of the rural infrastructure of the country, and additional funds were dedicated to various infrastructure needs of the country. Thus, long-term investment in infrastructure development is projected to boost the demand for steel merchant & rebars over the coming years.U.S. Steel Merchant and Rebar Market Report Highlights In terms of volume, the infrastructure segment is projected to register the fastest CAGR of 4.7% from 2020 to 2027Key driving factors for the segment are increasing investments by the U.S. Federal government in the infrastructure segmentThe industrial segment accounted for a considerable revenue share in 2019. Demand for commercial spaces in high-rise buildings is projected to push the product demand in this segmentRebars was the largest product segment and accounted for a volume share of 60.4% in 2019A moderate boost to the residential construction after the first half of 2020 is likely to push the demand for rebars over the short termIn the merchant bar product segment, angles & channels were the fastest-growing subsegments and are anticipated to expand further on account of rising spending in public and private infrastructure developmentSluggishness in the economic activities in 2019 and the outbreak of COVID-19 in 2020 have created an impact on the U.S. steel merchant & rebar demand in the recent past. In terms of volume, the market has declined by 2.1% from 2018 to 2019. Key Topics Covered: Chapter 1. Methodology and ScopeChapter 2. Executive Summary2.1. Market SnapshotChapter 3. U.S. Steel Merchant & Rebar Market Variables, Trends & Scope3.1. Penetration & Growth Prospect Mapping3.2. Industry Value Chain Analysis3.2.1. Raw material trends3.3. Regularity Framework3.4. Market Dynamics3.4.1. Market Driver Analysis3.4.2. Market Restraint Analysis3.4.3. Market challenges3.5. Business Environment Analysis: U.S. Steel Merchant & Rebar market3.5.1. Industry Analysis - Porter's3.5.2. Pestel AnalysisChapter 4. U.S. Steel Merchant & Rebar Market: Product Estimates & Trend Analysis4.1. Definition & Scope4.2. Product Movement Analysis & Market Share, 2019 & 20274.3. Market size & forecasts and trend analysis, 2016 to 20274.3.1. Rebars4.3.1.1. Market estimates & forecasts, 2016 - 2027 (Kilotons) (USD Million)4.3.2. Merchant barsChapter 5. U.S. Steel Merchant & Rebar Market: Application Estimates & Trend Analysis5.1. Definition & Scope5.2. Application Movement Analysis & Market Share, 2019 & 20275.3. Market size & forecasts and trend analysis, 2016 to 20275.3.1. Construction5.3.1.1. Market estimates & forecasts, 2016 - 2027 (Kilotons) (USD Million)5.3.2. Infrastructure5.3.3. IndustrialChapter 6. U.S. Steel Merchant & Rebar Market - Competitive Analysis6.1. Key players & recent developments & their impact on the industry6.2. Vendor Landscape6.2.1. List of potential end-usersChapter 7. Company profiles Gerdau S.A.NucorCMC SteelSteel Dynamics Inc.Schnitzer Steel Industries, Inc.Nippon Steel CorporationJFE Steel Corporation For more information about this report visit https://www.researchandmarkets.com/r/do06z7 Research and Markets also offers Custom Research services providing focused, comprehensive and tailored research. CONTACT: CONTACT: ResearchAndMarkets.com Laura Wood, Senior Press Manager press@researchandmarkets.com For E.S.T Office Hours Call 1-917-300-0470 For U.S./CAN Toll Free Call 1-800-526-8630 For GMT Office Hours Call +353-1-416-8900

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Beware the 2021 Bitcoin price crash. Im buying the best UK shares to get rich instead - Yahoo Finance UK