Daily Archives: March 10, 2024

Bitcoin hit a record high of more than $69,000 on Tuesday, capping a remarkable comeback for the volatile cryptocurrency after its value plunged in 2022 amid a market meltdown.

Bitcoins price has risen more than 300 percent since November 2022, a resurgence that few predicted when the price dropped below $20,000 that year. Its previous record was just under $68,790 in November 2021, as crypto markets boomed and amateur investors poured savings into experimental digital coins.

The cryptocurrency was pronounced dead for the 150th time, said Cory Klippsten, the chief executive of Swan, a financial services firm focused on Bitcoin. And Bitcoin continues to do what Bitcoin does, which is win people over as they take the time to actually learn about it.

Bitcoins recent surge has been driven by investor enthusiasm for a new financial product tied to the digital coin. In January, U.S. regulators authorized a group of crypto companies and traditional finance firms to offer exchange-traded funds, or E.T.F.s, which track Bitcoins price. The funds provide a simple way for people to invest in the crypto markets without directly owning the virtual currency.

As of last week, investors had poured more than $7 billion into the investment products, propelling Bitcoins rapid rise, according to Bloomberg Intelligence.

The price of Ether, the second-most-valuable digital currency after Bitcoin, has also risen more than 50 percent this year, reaching about $3,800. Its increase has been driven partly by enthusiasm over the prospect that regulators may also approve an E.T.F. tied to Ether.

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Bitcoin Reaches Record High of $69,000, Recovering from 2022 Meltdown - The New York Times

Cryptocurrency enthusiasts celebrated on Tuesday, as the price of Bitcoin reached a record high of more than $69,000. For believers, it was a moment of vindication after a 2022 industry downturn that sent several major companies into bankruptcy and tainted cryptos reputation.

But is crypto really back from the dead? While the numbers suggest the industry is starting to thrive again, there are major differences between this bull run and the euphoria that drove crypto prices to previous highs.

Heres what to know about the new crypto surge.

The last time Bitcoin hit a record was November 2021, as cryptocurrencies became a cultural phenomenon. Crypto executives hung out with celebrities, and their companies conducted giant marketing campaigns featuring Super Bowl commercials.

Prices crashed in the spring of 2022 as some of the most prominent crypto firms were exposed as frauds. People who had poured their savings into crypto lost everything. The decline culminated in November 2022 when the FTX crypto exchange, founded by Sam Bankman-Fried, collapsed after the equivalent of a bank run, costing customers $8 billion.

Since then, Bitcoin has been on a tear. After hitting a low of roughly $16,000 after FTXs implosion, the virtual currencys price has soared to $69,000.

A major turning point for the crypto industry arrived in August when a court ruling paved the way for financial firms to offer new investment products tied to the price of Bitcoin. The products, called exchange-traded funds, or E.T.F.s, gave investors a way to dabble in cryptocurrencies without owning them directly.

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What to Know About Bitcoins Record High in Latest Crypto Surge - The New York Times

ZyCrypto

BlackRock, one of the worlds largest asset managers with over $9 trillion assets under management, is positioning itself to capitalize on the growing interest in Bitcoin by filing to add spot Bitcoin ETFs to its Global Allocation Fund (MALOX), according to an SEC filing on March 7.

This move marks a significant development in the institutional adoption of Bitcoin, as BlackRock seeks to invest in spot Bitcoin ETFs listed and traded on national exchanges, including its own iShares Bitcoin Trust (IBIT) and ETFs issued by other institutions.

The fund may acquire shares in ETPs that seek to reflect generally the performance of the price of Bitcoin by directly holding bitcoin Bitcoin ETPs including shares of a Bitcoin ETP sponsored by an affiliate of BlackRock, Blckrock said in a statement.

Blackrocks Growing Interest in Bitcoin

The decision to invest in spot Bitcoin ETFs comes as BlackRocks IBIT has seen a remarkable increase in Bitcoin holdings since its approval on January 11,2024.

The funds Bitcoin holdings have surged from 2,621 on January 11 to 187,531 as of March 7, representing a growth rate of over 7,000%. This substantial increase in Bitcoin holdings underscores BlackRocks bullish outlook on the digital asset.

BlackRocks confidence in Bitcoin is further highlighted by its belief that the optimal allocation for Bitcoin in a portfolio should be approximately 84.9%. This view aligns with the growing sentiment among institutional investors that Bitcoin is a viable store of value and a hedge against inflation.

Institutional Uptake and BTC Price Prediction

The approval of spot Bitcoin ETFs is expected to drive further institutional uptake of Bitcoin. Ernst & Young estimated that approximately $200T of institutional asset managers were sceptical about Bitcoin until the spot ETFs were greenlighted.

With more institutions entering the market, Ark Invests Cathie Wood speculates that Bitcoins price could surpass $600,000.

The approval of spot Bitcoin ETFs could have a significant impact on the market. Even with a conservative 0.5% allocation into Bitcoin by the $200 trillion institutional funds, Bitcoin could see a market cap increase of over $1 trillion. This influx of institutional capital could drive Bitcoins price to new all-time highs.

At the time of writing, Bitcoin was trading at $68,220, showing a slight pullback from its recent record highs. However, with the growing institutional interest and the approval of spot Bitcoin ETFs, Bitcoins price trajectory remains optimistic, with the potential to reach new all-time highs.

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BlackRock's Global Allocation Fund Eyes Spot Bitcoin ETFs, Expects Institutional Uptake to Drive BTC Above $600k - TradingView

While one bitcoin miner revealed Wednesday it seeks to reduce costs by closing one of its facilities, another looks to bolster revenue by supporting high-performance computing.

Texas-based Core Scientific, which emerged from bankruptcy in January, said it is set to lease up to 16 megawatts of capacity in its Austin datacenter to cloud provider CoreWeave.

The Core Scientific facility that once housed tech giant Hewlett Packard will now host infrastructure supporting applications in artificial intelligence (AI) and high-performance computing (HPC).

Possible revenue via the CoreWeave deal exceeds $100 million, the company said in a Wednesday news release.

We believe todays Core Scientific has the valuable ability to flex our asset base in order to maximize revenue and earnings, Core Scientific president Adam Sullivan said in a statement. Our diversified business model and leading scale enable us to continue operating as a low-cost bitcoin miner while also expanding our hosting customer base and diversifying our earnings streams.

The multi-year contract with CoreWeave is just the latest example of a large mining player seeking to get more involved in the AI and HPC realms.

Hive Digital Technologies went through an AI-inspired rebrand last July as part of a pivot to high-performance computing. Industry peers Hut 8 and Iris Energy also last year pointed to the segment as a priority.

Read more: Bitcoin miners seek revenue with AI, high-performance computing

Aside from diversifying revenue streams, boosting efficiency and reducing costs has been on the minds of bitcoin miners particularly as mining rewards are set to be cut in half next month.

At the time of the next Bitcoin halving, slated for mid-April, per-block rewards for BTC miners are set to drop from 6.25 BTC to 3.125 BTC.

The halving event occurring roughly every four years is expected to put financial stress on companies in the sector, likely spurring some to shut down operations or look to be acquired.

Coming off its merger with US Bitcoin Corp., Hut 8 said Wednesday it would shutter its Drumheller site in Alberta, Canada.

The move comes about a month after Hut 8 CEO Asher Genoot called out the facility for having an aging fleet and high energy rates. Repeated electrical problems at that site in recent quarters has contributed to decreased bitcoin mining production, executives have noted on earnings calls.

Read more: New Hut 8 CEO prepared to make hard decisions to nix inefficiencies

Genoot said in a statement Wednesday that elevated energy costs and underlying voltage issues has continued to impact the sites profitability.

Our restructuring plan aims to drive maximum value from our assets and position the company for profitable growth, he added.

The sites more efficient miners will move to Hut 8s Medicine Hat facility also in Alberta. Machines with an efficiency worse than 38 joules per terahash (J/TH) will no longer operate, the company noted.

Hut 8 is keeping its lease at the site to give it the option of re-energizing there if market conditions improve.

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Miners continue money-conscious moves ahead of the Bitcoin halving - Blockworks