Category Archives: Bitcoin

Bitcoin has received a lot of attention from investors, especially over the past year, as the price of the cryptocurrency skyrocketed from around $8,000 at the beginning of 2020 to more than $40,000 as 2021 began.

But recently, theprice of bitcoin dropped suddenly, and the slide has once again ignited the debate over whether bitcoin is a viable alternative payment system or just a speculative investment. Whatever side of that argument you may fall on, there are many great companies that are far better long-term investments than bitcoin.

Read on to find out why three Motley Fool contributors believe thatFiverr International (NYSE:FVRR),Square(NYSE:SQ), and PayPal Holdings (NASDAQ:PYPL) have the potential to beat bitcoin.

Image source: Getty Images.

Danny Vena (Fiverr): One of the draws of bitcoin is no doubt the potential for a small investment to pay out big over time. Catching an investment early and riding it to untold riches has a certain appeal, but it rarely works out that way. That's why I believe investors should forget bitcoin and put their money to work in Fiverr International.

It seems that these days, everybody has a side hustle, a way to make a little money on the side. Then there are those who have broken away from the traditional workforce, opting instead for the freedom that comes from self-employment. The challenge for freelancers, however, is finding businesses with needs that match their skillsets. That's where Fiverr comes in.

The company provides one of the world's largest digital sales platforms that helps connect freelancers with these businesses, and does so for as little as $5 -- the reason for its moniker. Sellers (freelancers) post their talents and services (called gigs) in a growing list of 300 categories, allowing for businesses to shop their services. Fiverr acts as the escrow, holding the finds to ensure that both parties are satisfied, charging a 20% commission for its services as matchmaker. The pandemic accelerated the pace of the digital transformation, playing right to Fiverr's strengths.

Its position as gatekeeper and toll collector has been extremely lucrative for Fiverr. The company has generated revenue that's accelerated in each of previous four quarters. In the third quarter, revenue jumped 88% year over year, while Fiverr's net loss improved 95%, knocking on the door of profitability much sooner than investors had anticipated.

Activity on the platform is helping drive its financial results. Active buyers increased 37%, but perhaps more importantly, existing buyers are spending more. In fact, the average spend per buyer has climbed relentlessly, notching gains every single year all the way back to 2012, and has more than tripled during that time frame.

Future growth looks brighter than ever, as each cohort of buyers increases the company's foundation, with many becoming repeat users. In 2019, 58% of revenue came from existing buyers, with the remaining 42% coming from new users. The company is also courting enterprise clients with its Fiverr Business platform, helping match sellers with the big businesses that need their services. This move upmarket will help boost average spending per buyer even further.

The gig economy will only grow from here. Fiverr's management pegs the company's total addressable market at $115 billion and counting. With trailing-12-month revenue of just $100 million, Fiverr has plenty of worlds left to conquer.

Brian Withers (Square): If you are interested in profiting from the bitcoin trend, why not buy into the company that sold $1.6 billion of the cryptocurrency last quarter? Square and its popular Cash App allow users to buy and sell bitcoin, but this fintech has so much more to offer.

Square has two ecosystems: its original business centered around serving sellers, and Cash App, focused on serving individuals. The company started by selling a small square-shaped device that plugs into a mobile device to help sellers and small businesses collect payments. This ecosystem has expanded to support all aspects of running a small business, including payroll, customer engagement, and even setting up e-commerce websites. Last quarter, its seller ecosystem posted $965 million in revenue and $409 million in gross profit, up 5% and 12% year over year, respectively. The coronavirus has hampered growth in the last several quarters, but as vaccines get rolled out globally, small business activity should recover and this ecosystem will return to strong growth.

The Cash App ecosystem has been an incredible growth driver this year. Not only have gross profit gains been in the triple digits year over year, but they have accelerated over the last three quarters, reaching a jaw-dropping 212% growth last quarter. Cash App is popular because of its ability to buy bitcoin, but customers love many of its other features, too. Over 2.5 million customers have used Cash App to buy and sell stocks, and users carried more than $1.8 billion in cash in their accounts, up 180% year over year.

But this fintech is just getting started. With its seller ecosystem's addressable market of more than $100 billion annually and the Cash App market exceeding $60 billion, it's captured less than 3% and 2% of each market, respectively. There's a lot to like about this fintech: accelerating Cash App growth, a seller ecosystem that's set to bounce back when the economy picks up, and a popular bitcoin trading platform. Why just settle for buying bitcoin when you can buy into shares of this tech company with two strong ecosystems serving two massive addressable markets?

Chris Neiger (PayPal): If you're drawn to bitcoin because of its potential to disrupt traditional ways of buying and selling goods, then you may want to consider PayPal's bet on digital payments.

PayPal has long been a household name for online payments, but the company has continued to grow far beyond its original payment platform. For example, the company's Venmo app, which allows peer-to-peer payments, has become an important service for the company over the past few years.

Venmo can now be used to pay for goods and services at physical locations, and, if you're still interested in bitcoin, can be used to buy and sell cryptocurrencies as well.

Aside from Venmo's potential in digital payments, PayPal also recently partnered with CVS HealthandNike to allow PayPal users to make contactless payments with QR codes at physical stores. This move by PayPal blends digital payments with physical locations and is helping the company continue to expand how it generates sales through its platform.

In the most recent quarter, PayPal added an impressive 15.2 million net new active accounts, sales jumped 25%, and the company's earnings skyrocketed 121% from the year-ago quarter. And the company's management estimates that the company's full-year 2020 generally accepted accounting principles (GAAP) earnings will be up 38% year over over.

The U.S. digital payments market will reach an estimated $2 trillion by 2025,and PayPal is already a clear leader in this space. For investors who are looking for a great investment in digital payments, PayPal's customer growth, solid earnings, and expansion into new services make it a more solid bet than guessing whether the price of bitcoin will rise or fall.

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3 Stocks That Are Better Than Bitcoin - The Motley Fool

Bitcoin is showing signs of maturity but the level of institutional investment in the nascent market is still very small, according to Goldman Sachs' Jeff Currie.

The investment bank's head of commodities research said that more money from the financial world would need to flow into bitcoin in order for it to stabilize. Bitcoin and other cryptocurrencies saw a brutal sell-off on Monday that wiped off as much as $200 billion from the market value of all digital coins combined in just 24 hours.

That came after a remarkable surge for bitcoin in the last few months, with the world's most valuable virtual currency hitting a record high near $42,000 last week. Bitcoin is still up roughly 15% since the start of the year, trading 4% higher at a price of $33,873 as of 10:30 a.m. ET on Tuesday. Ether, the second-largest digital currency, was up 5%, trading at $1,058.

"I think the market is beginning to become more mature," Currie told CNBC's Steve Sedgwick in an interview Monday. "I think in any nascent market you get that volatility and those risks that are associated with it."

"The key to creating some type of stability in the market is to see an increase in the participation of institutional investors and right now they're small," he said, adding that, of the more than $600 billion invested in bitcoin right now, "roughly 1% of it is institutional money."

Investors increasingly view bitcoin as a store of value similar to gold, amid worries that unprecedented economic stimulus in the face of the coronavirus pandemic will devalue major sovereign currencies like the dollar.

Last year saw the emergence of well-known Wall Street investors like Paul Tudor Jones and Stanley Druckenmiller betting on bitcoin. Some asset managers have also allocated a small portion of their portfolios to the cryptocurrency, seeking to get some exposure to its wild gains.

Strategists at JPMorgan have said bitcoin could surge as high as $146,000 in the long term as it competes with gold as a safe-haven asset. They also noted, however, that bitcoin would have to become substantially less volatile to reach this price.

Digital currencies are notoriously volatile. The last time bitcoin had a rally similar to this was in 2017, when it soared close to $20,000 a coin before crashing as low as $3,122 the following year. Skeptics, such as stockbroker Peter Schiff and economist Nouriel Roubini, view bitcoin as a speculative asset and a market bubble likely to burst.

A big question among investors has been how to value bitcoin. Bitcoin isn't like a stock, which has traditional metrics for figuring out whether it is overpriced or undervalued. The cryptocurrency has a market value of more than $600 billion, and this is calculated by multiplying the price by the total number of coins in circulation.

"That can give you some long-run equilibrium," Currie said. But he added that the level of volatility and uncertainty in the market "makes it very difficult to forecast it."

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Goldman says bitcoin is starting to mature but institutional money is a tiny fraction of the market - CNBC

The wonder of the universe is that it is always in motion and, because of this, that everything changes over time. So, anything can be something completely different tomorrow, just like that no guarantees.

Karl Marx expressed this brilliantly with the phrase "All that is solid melts into air." The same occurred with Bitcoin (BTC), which over the years has undergone transformations, and from a cypherpunk idea, it has become a simple Che Guevara T-shirt.

The following words, which Eric Hughes published in A Cypherpunk's Manifesto, was the great orientation of the developers in the creation of e-cash, or electronic money, that was universal, private and without control:

It was this idea that gave rise to Bitcoin, a decentralized money oriented toward privacy and for each one to be their own bank.

Chancellor on brink of second bailout for banks: This phrase from The Times is even recorded forever in the genesis block of the Bitcoin blockchain. However, time has transformed Bitcoin, and from a restricted circle of cryptographers, BTC has conquered the world and arrived at the International Monetary Fund, Bank for International Settlements, G-20 and G-8. Who knows before the moon, it can reach Mars.

So, as Bitcoin changed, so did the ideas around it. The desire for privacy gave way to to the moon, and the fruit of a manifesto became just another product of what we wanted to fight.

Today, instead of the phrases include unbanked people and be your own bank, we celebrate that major traditional banks advertise Bitcoin custody services. Instead of privacy, we rush to take selfies with documents in search of higher limits for trades, leverage, options and futures. We are happy that billionaire funds and big companies and corporations are buying all the Bitcoin they can, believing that they are now also Bitcoiners.

In politics, there is a phrase that says that if you did something so good and so wonderful to change the world that even your opponents are applauding you, it means you did everything wrong.

We are applauding the great capitalists those who were bailed out by the governments, those who caused the economic crises and those same banks that spit in our face. We are happy today to sit beside them and sell our Bitcoin to them, believing that they love us.

We celebrate that countries create regulations for Bitcoin, highlighting that it brings security to the crypto industry, and were proud to see that the biggest companies in the market are collaborating with authorities to reveal hackers and malicious agents.

Many big players are ashamed to say that Bitcoin is used by hackers, and they forget the history of BTC and its main objective: to be anonymous money.

We accept giving up our privacy to sit at the table with those we criticize all the time, thinking that they really love us when, in fact, they are only looking for profits.

Stamping Fiat is a shitcoin on dollar bills is like being an "independent" teenager who decides to live alone but whose parents pay rent, buy food and do the laundry. What matters is the dollar value that Bitcoin will break $30,000, $50,000, $100,000 or $300,000 inventory, and flow... To the moon.

Fiat sucks, but the more Bitcoin is worth in U.S. dollars, the better. After all, what matters is that 1 Bitcoin will always be equivalent to 1 Bitcoin. It matters how much I bought and how much I hope to sell in order to buy more.

We went so far as to find silly people who traded Bitcoin for pizzas or acted like Sirius, who sold 5,000 BTC to help create the first Bitcoin exchange. Hold, hold and hold so that it can be worth more and more I just heard that.

Accumulate, accumulate, accumulate and accumulate more and more value in Bitcoin. After all, it is the digital gold and value reserve of a new era. But the new normal is nothing but the old normal with a new face.

Whales went from names like Joe007 to Paul Tudor Jones, MassMutual, MicroStrategy and other institutional investors the same ones that will be bailed out by the government if a bankruptcy approaches.

I have nothing against this. After all, "Lamborghini" and "Bitcoin lifestyle" were already part of this market, and the world, like all things, is always in transformation.

I am happy to buy my Bitcoin, just as I buy a Che Guevara T-shirt and light a cigarette, believing that I am fighting the system while I wait for my mom to bring me dinner.

To the moon. Or better, to Mars, in Elon Musk style.

This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.

The views, thoughts and opinions expressed here are the authors alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.

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Bitcoin has become nothing but the new Che Guevara T-shirt - Cointelegraph

TipRanks

Watching the markets with an eye to the main chance, Raymond James strategist Tavis McCourt sees both risk and opportunity in current market conditions. The opportunity, in his opinion, stems from the obvious factors: the Democrats won both Georgia Senate seats in the recent runoff vote, giving the incoming Biden Administration majority support in both Houses of Congress and increasing the odds of meaningful fiscal support getting signed into law in the near term. More importantly, the coronavirus vaccination program is proceeding, and reports are showing that Pfizers vaccine, one of two approved in the US, is effective against the new strain of the virus. A successful vaccination program will speed up the economic recovery, allowing states to loosen lockdown regulations and get people back to work. The risks are also coming from the political and public health realms. The House Democrats have passed articles of impeachment against President Trump, despite the imminent natural closure of his term of office, and that passage reduces the chances of political reconciliation in a heavily polarized environment. And while the COVID strain is matched by current vaccines, there is still a risk that a new strain will develop that is not covered by existing vaccinations which could restart the cycle of lockdowns and economic decline. Another risk McCourt sees, beyond those two, would be a sharp rise in inflation. He doesnt discount that, but sees it as unlikely to happen soon. product/service inflation is only really a possibility AFTER re-openings, so the market feels a bit bullet proof in the very near term, and thus the continued rally, with Dems winning the GA races just adding fuel to the stimulus fire, McCourt noted. Some of McCourts colleagues among the Raymond James analyst cadre are keeping these risks in mind, and putting their imprimatur on strong dividend stocks. Weve looked into Raymond James' recent calls, and using the TipRanks database, weve chosen two stocks with high-yield dividends. These Buy-rated tickers bring a dividend yield of 7%, a strong attraction for investors interested in using the current good times to set up a defensive firewall should the risks materialize. Enterprise Products Partners (EPD) Well start in the energy sector, a business segment long known for both high cash flows and high dividends. Enterprise Products Partners is a midstream company, part of the network that moves hydrocarbon products from the wellheads to the storage farms, refineries, and distribution points. Enterprise controls over 50,000 miles worth of pipelines, shipping terminals on Texas Gulf coast, and storage facilities for 160 million barrels oil and 14 billion cubic feet of natural gas. The company was hurt by low prices and low demand in 1H20, but partially recovered in the second half. Revenues turned around, growing 27% sequentially to reach $6.9 billion in Q3. That number was down year-over-year, slipping 5.4%, but came in more than 6% above the Q3 forecast. Q3 earnings, at 48 cents per share, were just under the forecast, but were up 4% year-over-year and 2% sequentially. EPD has recently declared its 4Q20 dividend distribution, at 45 cents per common share. This is up from the previous payment of 44 cents, and marks the first increase in two years. At $1.80 annualized, the payment yields 7.9%. Among the bulls is Raymond James' Justin Jenkins, who rates EPD a Strong Buy. The analyst gives the stock a $26 price target, which implies a 15% upside from current levels. (To watch Jenkins track record, click here) Backing his bullish stance, Jenkins noted, "In our view, EPD's unique combination of integration, balance sheet strength, and ROIC track record remains best in class. We see EPD as arguably best positioned to withstand the volatile landscape With EPD's footprint, demand gains, project growth, and contracted ramps should more than offset supply headwinds and lower y/y marketing results" Its not often that the analysts all agree on a stock, so when it does happen, take note. EPDs Strong Buy consensus rating is based on a unanimous 9 Buys. The stocks $24.63 average price target suggests an upside of 9% from the current share price of $22.65. (See EPD stock analysis on TipRanks) AT&T, Inc. (T) AT&T is one of the markets instantly recognizable stock. The company is a member in long standing of the S&P 500, and it has reputation as one of the stock markets best dividend payers. AT&T is a true large-cap industry giant, with a market cap of $208 billion and the largest network of mobile and landline phone services in the US. Its acquisition of TimeWarner (now WarnerMedia), in a process running between 2016 and 2018, has given the company a large stake in the mobile content streaming business. AT&T saw revenues and earnings decline in 2020, under pressure from the corona pandemic but the decline was modest, as that same pandemic also put a premium on telecom and networking systems, which tended to support AT&Ts business. Revenues in 3Q20 were $42.3 billion, 5% below the year-ago quarter. On positive notes, free cash flow rose yoy from $11.4 billion to $12.1 billion, and the company reported a net gain of 5.5 million new subscribers. The subscriber growth was driven by the new 5G network rollout and by premium content services. The company held up its reputation as a dividend champ, and has made its most recent dividend declaration for payment in February 2021. The payment, at 52 per common share, is the fifth in a row at current level and annualizes to $2.08, giving a yield of 7.2%. For comparison, the average dividend among tech sector peer companies is only 0.9%. AT&T has kept its dividend strong for the past 12 years. Raymond James analyst Frank Louthan sees AT&T as a classic defensive value stock, and describes Ts current state as one with the bad news baked in. [We] believe there is more that can go right during the next 12 months than can get worse for AT&T. Throw in the fact that shares are heavily shorted, and we believe this is a recipe for upside. Large cap value names are hard to come by, and we think investors who can wait a few months for a mean reversion while locking in a 7% yield should be rewarded for buying AT&T at current levels, Louthan opined. In line with these comments, Louthan rates T an Outperform (i.e. Buy), and his $32 price target implies room for 10% growth from current levels. (To watch Louthans track record, click here) What does the rest of the Street think? Looking at the consensus breakdown, opinions from other analysts are more spread out. 7 Buy ratings, 6 Holds and 2 Sells add up to a Moderate Buy consensus. In addition, the $31.54 average price target indicates ~9% upside potential. (See AT&T stock analysis on TipRanks) To find good ideas for dividend stocks trading at attractive valuations, visit TipRanks Best Stocks to Buy, a newly launched tool that unites all of TipRanks equity insights. Disclaimer: The opinions expressed in this article are solely those of the featured analysts. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.

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Why Jack Dorsey Sees Bitcoin As The Answer To Donald Trump Ban Controversy - Yahoo Finance

One prognosticator following PayPal Holdings (NASDAQ:PYPL) feels the company is deserving of far more investor love. In a research note circulated on Friday, Dan Dolev of Mizuho Securities raised his price target on the stock to a "street high" of $350 per share, quite a hike from the previous $290. His recommendation, not surprisingly, is a buy. The new level is 46% higher than the shares' most recent closing price.

One big factor is at play with Dolev's increase -- bitcoin specifically, and cryptocurrencies generally.

Image source: Getty Images.

"Both our survey and management commentary unveil a dramatic increase in engagement due to crypto," he wrote in his note. He pointed out that PayPal said 50% of its users active in cryptocurrency were interacting with the company's app on a daily basis.

Dolev believes that this activity will add roughly 10% to PayPal's adjusted net revenue in 2023, or around $2 billion.

PayPal and cryptocurrency are recent partners. Following a pilot program, in November the company opened cryptocurrency services to all customers throughout the various PayPal services. At the time, it said it would roll this out to its popular peer-to-peer service Venmo too.

In doing so, PayPal was and is heeding high demand for such functionality. In a recent company earnings call, CEO Daniel Schulman said that "our base is very eager for us to offer these capabilities."

Cryptocurrencies have been on a serious tear lately. This rally has been led, as ever, by pace-setter bitcoin. In just the last month, even after several pull-backs, one bitcoin has zoomed in value to over $36,843 from a shade over $19,194.

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Analyst: PayPal Holdings Has 46% Upside Thanks to Bitcoin Surge - The Motley Fool

The reflection of bitcoins in a computer hard drive.

Thomas Trutschel | Photothek via Getty Images

LONDON A British man who accidentally threw out a hard drive with a trove of bitcoin on it is once again urging local city officials to let him search for it in a landfill site.

James Howells, a 35-year-old IT engineer from Newport, Wales, said he discarded the device while clearing out his home in 2013. He claims he had two identical laptop hard drives, and that he mistakenly put the one containing the cryptographic "private key" needed to access and spend his bitcoins in the trash.

After all these years, Howells is still confident he'd be able to recover the bitcoin. Though the external part of the hard drive may be damaged and rusted, he believes the glass platter inside may still be intact.

"There is a good chance the platter inside the drive is still intact," he told CNBC. "Data recovery experts could then rebuild the drive or read the data directly from the platter."

Howells says he had 7,500 bitcoins which, at today's prices, would be worth more than $280 million. He says the only way to regain access to it would be through the hard drive he threw in the trash eight years ago.

But he needs permission from his local council to search a garbage dump he believes contains the lost hardware. The landfill is not open to the public and trespassing would be considered a criminal offense.

Howells has offered to donate 25% of the haul worth around $70.8 million to a "Covid Relief Fund" for his home city if he manages to dig up the hard drive. He has also promised to fund the excavation project with the backing of an unnamed hedge fund.

But the Newport City Council has so far rejected his requests to look through the landfill, citing environmental and funding concerns. And it doesn't seem like local officials are about to budge anytime soon.

"As far as I am aware they have already rejected the offer," Howells said. "Without even having heard our plan of action or without being given a chance to present our mitigations to their concerns regarding the environment, it's just a straight up 'no' every time."

A spokesperson for the council told CNBC it had been "contacted a number of times since 2013 about the possibility of retrieving a piece of IT hardware said to contain bitcoins," the first being "several months" after Howells first realized the drive had gone missing.

"The council has told Mr Howells on a number of occasions that excavation is not possible under our licencing permit and excavation itself would have a huge environmental impact on the surrounding area," the council spokesperson said.

"The cost of digging up the landfill, storing and treating the waste could run into millions of pounds without any guarantee of either finding it or it still being in working order."

It's not hard to imagine why Howells would want to salvage the equipment. Bitcoin prices have skyrocketed in the past few months, hitting an all-time high near $42,000 last week before pulling back sharply.

The New York Times reported Tuesday that a programmer in San Francisco has been locked out of 7,002 bitcoins worth about $267.8 million today because he forgot the password needed to unlock a small hard drive containing the private key to a digital wallet.

Bitcoin's network is decentralized, meaning it isn't controlled by a single individual but a network of computers. Each transaction originates from a wallet which has a "private key." This is a digital signature and provides mathematical proof that the transaction has come from the owner of the wallet.

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Man makes last-ditch effort to recover $280 million in bitcoin he accidentally threw out - CNBC

After closing out last week at over $40,000 on Sunday, bitcoin hit that price again Thursday while traders are pushing ether volumes to new liquidity levels.

Bitcoin trading on Bitstamp since Jan. 11.

Bitcoins price was back to bull mode Thursday, steadily climbing to as high as $40,066, according to CoinDesk 20 data. Its a reversal from this weeks bearish-to-sideways action, with the worlds oldest cryptocurrency at $39,318 as of press time.

Bitcoin passing $40,000 was seen by many as inevitable, and reaching this level is just the continuation of a trend of smart money continuing to buy even as traders with less conviction shake out during sell-offs, Guy Hirsch, managing director for U.S. at multi-asset brokerage eToro, told CoinDesk. The last time bitcoin was over $40,000 in the spot markets was Sunday, Jan. 10, prior to a precipitous fall opening the week.

Bitcoins historical price the past week.

Institutions are still buying up BTC in huge quantities, said cryptocurrency over-the-counter trader Alessandro Andreotti. I think this rally can continue as before, but its too early to call.

In the derivatives market, funding rates are still in positive territory, signalling that leveraged traders are more than willing to pay up to pile more margin on long plays, according to data aggregator Skew.

BTC swaps funding on major derivatives venues.

High volatility is having little impact on risk appetite, noted Denis Vinokourov, head of research at crypto brokerage Bequant. Recent success in these opportunistic and somewhat ambitious market bets is also likely driving herd-like behavior.

Indeed, volatility is high in the bitcoin market: The cryptocurrencys 30-day realized volatility was at over 89% Wednesday, the highest it has been since April 17, 2020, when that metric was at 92% in the early days of coronavirus-induced turmoil across all markets.

Bitcoins 30-day volatility the past year.(Shuai Hao/CoinDesk Research)

Analysts dont expect volatility in the cryptocurrency market to abate, which can actually be good for traders but can be horrendous for long-term investor balance sheets, particularly institutional funds with limited partners to whom they must answer.

People need to understand that bitcoin is a hyper-asset with a built-in steam engine that is explosive up and down, noted over-the-counter crypto trader Henrik Kugelberg. With all the money printing and the sad developing spread of COVID-19 throughout the world, widespread agonizing economic hardship and a few more factors spell advantage to bitcoin.

Chad Steinglass, head of trading for digital assets capital markets firm CrossTower, agrees gyrations in crypto will continue. I believe that the trend of bull runs briefly interrupted by short duration profit taking dips will continue for the foreseeable future.

Ether volume bonanza so far in 2021

Ether (ETH), the second-largest cryptocurrency by market capitalization, was up Thursday, trading around $1,210 and climbing 8.5% in 24 hours as of 21:00 UTC (4:00 p.m. ET).

In 2020, ether volumes on the eight major CoinDesk 20 spot exchanges averaged $231 million per day. In 2021 so far, those volumes are up almost twelvefold, averaging $2.7 billion per day.

Ether volumes on major spot exchanges the past year. (Shuai Hao/CoinDesk Research)

Brian Mosoff, chief executive officer of investment firm Ether Capital, noted decentralized finance, or DeFi, as a spark leading to volumes beginning to rise in 2020. For 2021, Mosoff cites the ongoing bull run and new derivatives tools coming online for traders.

Although 2020 ended in a bull market, the first half of the year saw the ETH prices average just a couple hundred dollars and a lack of positive sentiment due to the prolonged bear market and then COVID-19, Mosoff said. Adding fuel to the fire, 2021 has kicked off with the continuation of the crypto bull and the pending launch of the CME futures and institutions waking up to the narrative around Ethereums value proposition.

Other markets

Digital assets on the CoinDesk 20 are mixed Thursday, mostly in the green. Notable winners as of 21:00 UTC (4:00 p.m. ET):

The CoinDesk 20: The Assets That Matter Most to the Market

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Market Wrap: Bitcoin Hits $40K Again While Ether Volume Is Erupting This Year - CoinDesk - CoinDesk

It been three years since the great Bitcoin crash that followed a cryptocurrency frenzy of 2017. These days, some Bitcoin fans think this has matured as an investment vehicle.

A Bitcoin is a store of value made up zeros and ones, which hit an all-time high of nearly $42,000 a week ago today. With ascent of this digital asset as things like Bitcoin or Ethereum are called, some deeper-pocketed people have been turning to their investment advisers and wondering if they might be able to sprinkle some of this in among their stocks, bonds and gold.

There has been quite significant demand, said Joel Revill with the investment firm Two Ocean Trust, which pushed for and now received legal and regulatory approval in its base in Wyoming to add digital assets to portfolios.

There are many cryptos, but right now Bitcoin is the star. Revill see two groups that want this stuff in their mix, starting with the Bitcoin super fans, whove been following its development all along.

Thats the crypto native investor, someone who is well aware of the unique characteristics of say, Bitcoin, and has created their wealth by investing in Bitcoin, but has not really thought much about traditional wealth or estate management, or tax planning, Revill said.

Beyond these folks, there are now also just wealthy investors, or the outfits representing wealthy families, who are intrigued by the asset class, are dipping their toe in this for the first time, but they come with the expectations that they will have the same legal protections, and regulatory clarity, and trade execution, and reporting that they expect with investments in traditional assets, Revill said.

Individuals can get just order Bitcoin if they have the money. But financial advisers and professional money managers generally havent been able to add Bitcoin to the portfolios they manage. It has to do with a 1940s law and third-party custodians.

What we havent seen is sort of mainstream adoption by the banks and broker dealers, because of the lack of clarity thus far from their regulators, Revill said.

But heres the thing: Wyoming wants to attract this kind of business and has now passed a series of laws spelling out how to handle Bitcoin-style digital assets. The regulators there, Revill said, are also on board.

Our firm Two Ocean Trust is based in the state of Wyoming and we recently received a letter from our regulator that has permitted us to provide qualified custody for both traditional and digital assets, Revill said. It was the first of its kind issued by a bank regulator.

At the national level, the Securities and Exchange Commission is also considering ways to clarify these rules. In recent weeks, it sought feedback from financial professionals.

Thats the news, but to back up, why would non-tech-savvy investors be interested in Bitcoin at all? First, if inflation were to rise from the dead, by definition, traditional money drops in value. Thats Bitcoin as an inflation hedge.

Also, by design, there wont be much more Bitcoin created and this limited supply might drive up its price. Lastly, Revill said, Bitcoin is also useful in new financial technology that emerges.

Think of it as a replacement for global payment and settlement systems, Revill said. There are many significant advantages.

That is, if the global laws and regulations that govern this world of digital assets allow these things to happen, or if some other technology doesnt supplant it.

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With Bitcoins popularity increasing, what new regulations will we see? - Marketplace

What is bitcoin?

Bitcoin is a type of digital currency that emerged after the 2008 financial crisis. It allows people to bypass banks and traditional payment methods. It has become the most prominent among thousands of so-called cryptocurrencies.

It relies on blockchain technology, which is a shared database of transactions, with entries that must be confirmed and encrypted. The network is secured by individuals called miners who use high-powered computers to verify transactions, with bitcoins offered as a reward. There are more than 18m in existence, and the mathematical system controlling the generation of new bitcoins which is decentralised and therefore has no overarching institution such as a central bank has a hardwired maximum of 21m coins.

There are several currency exchanges where consumers can swap traditional fiat money backed by governments for cryptocurrencies, which must be stored using a digital wallet. Some of the biggest exchanges include Bitstamp, Coinbase and Gemini. However, finance firms have also created new investment products based on bitcoin and other cryptocurrencies, such as contracts for difference, which are used to track the value of an asset without needing to directly own it.

There are problems when it comes to using bitcoin as a currency, with many people simply owning it as a speculative investment instead, given its tendency for extreme swings in value.

Within the space of a single hour on Monday alone, its value fell by about $3,000 (2,230), then rose again by about $2,000. This makes it almost impossible to put a reliable price on goods and services.

Instead, there are ways to pay using applications such as BitPay, which converts bitcoin funds in a digital wallet to pay for goods in traditional currencies used by retailers. Transactions are growing, more so online than in physical shops, with firms including Microsoft, Lush and Expedia accepting payments. The first-ever bitcoin transaction was made in 2010, when a Florida man paid a British man 10,000 bitcoins to order him two Papa Johns pizzas. Today that would be worth more than $300m.

The City regulator is concerned crypto investment firms could be overstating potential payouts, or understating the risks, from investing in bitcoin and products related to the digital currency.

As a newer and relatively lightly regulated market, consumers are unlikely to have access to state-backed compensation if something goes wrong. There has also been a boom in bitcoin scams.

There are three main factors influencing the bitcoin price. First, the media frenzy over its boom in value, drawing in new buyers looking to make money. Second, more traditional finance firms are investing in the market. And finally, comparisons between bitcoin and gold, which fit with trends in the global economy.

The development of Covid-19 vaccines could enable a swift economic recovery from the pandemic, at a time when governments and central banks are still providing vast amounts of emergency support which could trigger a burst of inflation. Some investors view bitcoin as a store of value, similar to gold, which can hold its worth during times of economic stress or rising inflation.

Bitcoins value is almost entirely defined by perceptions. Some economists believe it is entirely worthless. However, analysts at JP Morgan have said it could hit $146,000 if it became as established as gold for investors. However, to match this reputation built up over millennia as a thing worth owning, with otherwise little intrinsic value it would need to become much less volatile.

More here:
What is bitcoin and why are so many people looking to buy it? - The Guardian

Bitcoin is making gains, though much of the day saw the cryptocurrency in a holding pattern. Meanwhile, a quarter of ether options are expiring in March, meaning traders are making some bets on the first fiscal quarter of 2021.

Bitcoin trading on Bitstamp since Jan. 10.

Bitcoin was able to recover from a drop in price Wednesday. After going as low as $32,463 around 01:00 UTC (8 p.m. ET Tuesday), it was able to stay in a $34,500-$35,000 range before breaking out to $36,464 before settling at $36,286 as of press time.

Despite the past few hours of price gains, analysts refer to a day of little price action as a sideways or flat market. Its not clear after so much excitement for the worlds oldest cryptocurrency in the first few days of 2021 what might happen next for the price, according to Misha Alefirenko, founder of crypto market maker VelvetFormula.

I have no clear view at the moment, Alefirenko told CoinDesk. Looks like big guys stepped away to wait and see. The market has to find its own balance.

Bitcoin spot volumes were clearly taking a breather after Mondays record-high daily zenith of $13.5 billion for the eight exchanges tracked by the CoinDesk 20. For Wednesday, the tally was at $4 billion as of press time, closer to the past months $3.8 billion daily spot average.

Daily BTC/USD volumes on major exchanges the past month.(Shuai Hao/CoinDesk Research)

However, Constantin Kogan, partner at crypto investment firm Wave Financial, has a bearish view of the bitcoin market. We may go even lower to $23,000, Kogan said. Because buy the dip is a strategy deployed in the crypto market if digital assets start dumping, prices may eventually find their near-term bottom. There is a zone from which they (traders) will start to actively buy back, Kogan added.

Another chart to note as bitcoins price has lifted over 23% so far this year is that of the dollar index (DXY), a measure of the greenbacks strength versus a basket of other fiat currencies. This time last year, the DXY index price was over 97. So far in 2021, its struggling to stay above 90.

The US Dollar index 4-hour chart the past year.

Wave Financials Kogan also noted there has been a closer, albeit opposite, relationship between United States duckets and bitcoin of late. The decline in bitcoin Monday occurred simultaneously with the strengthening of the dollar index, he said. As a result, the two largest currencies digital and traditional once again showed an inverse correlation.

Ether options expirations piling up in March

The second-largest cryptocurrency by market capitalization, ether (ETH), was up Wednesday, trading around $1,110 and climbing 2.5% in 24 hours as of 21:00 UTC (4:00 p.m. ET).

The amount of open interest in ether options is heavily favoring the March 21 expiration. That is where 25% of current options open interest are to be found, according to data from aggregator Skew.

Ether options open interest by expiration date.

Mostly its rolling, said Vishal Shah, founder of derivatives exchange Alpha5, referring to a strategy where traders roll up to a higher strike price. And while most strikes are favoring a sub-$800 spot price, the majority of the trades for Wednesday were calls (62%) versus puts (39%).

Current-day option flow orientations.

Shah told CoinDesk the March 21 expiration date pile-up correlates nicely with the end of the fiscal quarter and may explain why its taking the lions share of ether options open interest. Quarterly expirations are typically larger than monthly, and March is now the nearest quarterly expiry, he said.

Other markets

Digital assets on the CoinDesk 20 are all green Wednesday. Notable winners as of 21:00 UTC (4:00 p.m. ET):

The CoinDesk 20: The Assets That Matter Most to the Market

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Market Wrap: Bitcoin Claws Back to $36.4K While 25% of Ether Options Will Expire in March - CoinDesk - CoinDesk