Category Archives: Bitcoin

Bitcoin continued its volatile streak on Tuesday, starting the day with a tumble below the key $30,000 level and then a rally completely back into positive territory. It briefly turned negative for 2021 at one point Tuesday before recovering.

Near its low of the day, bitcoin fell more than 11% to about $28,911, below the $29,026 level where it ended 2020, according to Coin Metrics. The cryptocurrency then bounced and was up 0.43% after 4:00pm EST to $32,637.54 on the session, according to Coin Metrics.

Technical analysts had been watching the $30,000 level as a key support level on the charts after the cryptocurrency had fallen to near that low during its May crash.

Galaxy Digital CEO Mike Novogratz had noted on CNBC's "Squawk Box" Tuesday morning that bitcoin could still rebound after the early decline and if it didn't recover, there was significant downside to the next support level.

"Thirty-thousand, we'll see if it holds on the day. We might plunge below it for a while and close above it. If it's really breached, $25,000 is the next big level of support," Novogratz said. "Listen, I'm less happy than I was at $60,000, but I'm not nervous."

Bitcoin has been struggling to reclaim its highs from earlier in the quarter. It fell dramatically in May following some market-moving tweets by Elon Musk about bitcoin-related environmental concerns, and then even further in early June around fears of the cryptocurrency's use in the Colonial Pipeline ransomware attack.

It's been on a roller-coaster ride since then, battered by a stream of headlines out of China, where regulators have imposed new restrictions on energy-intensive mining and ordered financial institutions like Alipay to stop doing business with crypto companies. The price briefly touched $40,000 last week and fell again Monday.

With Tuesday's losses, bitcoin has been cut in half from its all-time high of more than $64,000 in mid-April, taking other cryptocurrencies along with it. Ether fell 5.6% and dogecoin dropped 12%.

Significant pullbacks have happened before in the cryptocurrency market, with bitcoin falling about 80% from its late 2017 highs at one point. Professional crypto investors have warned that the space should continue to be volatile in the years ahead.

"The only guarantee with the cryptocurrency space is volatility, and obviously that's what we have right now," Fairlead Strategies founder Katie Stockton told CNBC. "It's not new, we've had days like this before, it's just a matter of navigating through this noise."

Crypto investment product providers, such as CoinShares, Grayscale and Bitwise, are experiencing their sixth consecutive weeks of outflows, though some providers are seeing inflows, according to CoinShares. Bearish sentiment is more focused on bitcoin, with outflows for the week totaling $89 million and totaling $487 million for the year, or 1.6% of assets under management. Ether outflows, by contrast, are at $1.9 million for the week and $14.6 million for the year, or 0.14% of AUM.

Novogratz also noted that despite previous pullbacks, crypto market infrastructure is only becoming more mature, which has helped usher in more institutional support over the past year, with major hedge fund managers, pension funds and banks jumping into crypto, while registered investment advisors seek ways to get clients exposure to cryptocurrencies in ways that are compatible with their current workflow and wait for custody banks to introduce crypto services.

The price of bitcoin rose nearly 500% between mid-September and its April peak. Even with the recent decline, the cryptocurrency is still up more than 200% over the past 12 months.

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Bitcoin turns positive on day in wild session where it briefly dropped below $30,000 - CNBC

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Dont believe the Bitcoin bounce. The U.K.s decision to block Binance from engaging in regulated activity in that country is bad news for cryptocurrencies.

The U.K. government announced that Binance, a crypto exchange, is not allowed to engage in regulated activities and must make that clear on its website. Its not a banBinance can still offer crypto trading on its websitebut a limit placed on what it can do.

In an email to The Wall Street Journal, U.K. regulators highlighted that a significantly high number of crypto businesses are not meeting the required standards under money-laundering regulations as the reason for its actions.

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Thats not a surprise. Traditional banks and brokers are required to check on the legitimacy of their clients. Ultimately, crypto brokers and exchanges might have to do the same, require them to know their clients, something that isnt really part of the crypto ethos.

Bitcoin is rallying, up almost 5% Monday. The gain, however, doesnt matter much. It gets the worlds leading crypto to where it was on Thursday, before a 7.8% drop.

Bitcoin remains stuck at the lower end of its $30,000 to $40,000 trading range its been bouncing around in for more than a month.

It might have trouble gaining momentum and breaking out as global governments take a closer look at all things crypto.

Al Root

*** In this weeks Barrons Streetwise podcast, columnist Jack Hough talks with Pfizer CEO Albert Bourla about vaccines, cancer treatments, rising drug prices, and more. Listen here.

Sen. Joe Manchin (D., W.Va.) said Sunday he could support an additional spending bill of up to $2 trillion that could include a corporate tax rate increase to 25%, as GOP senators told the morning talk shows they were reassured by President Joe Bidens comments about the $1.2 trillion bipartisan infrastructure deal.

Whats Next: Democrats hope to pass a broader anti-poverty bill under a special budget process known as reconciliation that requires only a simple Senate majority vote. Senate Majority Leader Chuck Schumer (D., N.Y.) plans to address both bills in July.

Janet H. Cho

India confirmed more than 395,000 Covid deaths, but public health officials, statisticians and families believe the actual figure is much higher. That may affect the worlds understanding of the scope of the highly infectious Delta variant discovered in India, The Wall Street Journal reported.

Whats Next: The Delta variant made up 20.6% of U.S. cases as of June 19, including 29% of cases in Missouri and 10% of cases in Colorado, according to the CDC. In California, the Delta variant is 14.5% of the states cases and is growing rapidly.

Janet H. Cho

Unemployment is falling in the states where extra federal pandemic assistance is ending early, according to The Wall Street Journal, suggesting the move is forcing people to find jobs.

Whats Next: The governments report on job creation in June is slated for Friday, and Wall Street is looking for a somewhat bigger increase. Economists predict almost 700,000 new jobs were added this month, and the unemployment rate is expected to slip to 5.7% from 5.8%.

Liz Moyer

Didi Global, the Chinese ride-hailing company, is expected to raise $4 billion in an initial public offering this week on the New York Stock Exchange, while anticipation is also growing over Krispy Kremes return to the public market.

Whats Next: The listings illustrate the renewed vigor of the IPO market as investors try to take advantage of rising markets and generous valuations.

Pierre Brianon

The U.S. military said Sunday it had carried out defensive precision airstrikes against Iran-backed militia groups in the Iraq-Syria border region.

Whats Next: U.S. officials are concerned by the increasing use of drones by the militias in the region. But Biden is still trying separately to revive the 2015 nuclear deal with Iran.

Pierre Brianon

Whats the difference between a vacation home and a rental property, and what does the answer mean for your taxes?

A MarketWatch correspondent will answer this question soon. In the meantime, send any questions you would like answered to thebarronsdaily@barrons.com.

Newsletter edited by Liz Moyer, Stacy Ozol, Matt Bemer, Ben Levisohn

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Dont Believe the Bitcoin Bounce. The U.K.s Binance Restrictions Are Bad News for Cryptocurrencies. - Barron's

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David Gerard has not a kind word to spare for any part of the $1.4 trillion cryptocurrency market. Its dumb nerd money that nerds use to try to rip each other off, he says. Bitcoin in particular earns his ire. Its history is a series of get-rich-quick schemes, says Gerard, a 54-year-old IT administrator in London. He does not even have anything nice to say about the widely applauded technology underlying crypto, the digital ledger system known as the blockchain. A pile of nonsense, he concludes.

He has amassed a modest Twitter following spouting off like this (13,300 followers) and has self-published several books on the subject (Attack of the 50 Foot Blockchain and Libra Shrugged: How Facebook Tried To Take Over the Money). When Gerard wants to commune with other crypto haters, he heads over to a burgeoning corner of the web: a Reddit forum called Buttcoin, the name a suggestion that cryptocurrencies are, well, a waste of time. He often posts there several times a day and spends more time commenting on what the groups other 63,000 members publish. Every other Reddit about cryptocurrency is full of cultists! Or marketing shills. Or both, he says.

Cryptocurrencies including Bitcoin have made millions for investors large and small and become popularized by such mainstream figures as Jack Dorsey, who has said hed be working in cryptocurrency if he wasnt running Twitter and Squareand, of course, Elon Musk. The Tesla CEO made a $1.5 billion Bitcoin investment earlier this year that prompted a spike in the currency's value and later sold some of his holdings to help his electric-vehicle company report a first-quarter profit. Crypto has legions of devoted fans but also an army of critics. And sometimes those lines blur: Musk turned on Bitcoin last month and triggered a plunge in its price by saying Tesla would no longer accept the currency as payment for its vehicles, citing "the rapidly increasing use of fossil fuels" by miners who create the currency with banks of computers that create blocks of verified transactions which are then added to the blockchain.

Crypto foes on Reddit cheered Musk's retreat and trumpet any such negative news to fuel their own strident criticism of Bitcoin and other currencies, pointing out that they are underpinned by little other than hype of the kind initially inspired by Musk. Like those true believers, the denizens of Buttcoin tend to be men interested in technology who are constantly online and enjoy communicating through things like memes. (The group motto: Buttcoin: backed by gold, comedy gold!) But rather than devote themselves to talking up an asset, Buttcoin does the opposite, schadenfreude firmly established as the groups lingua franca.

Some of the most popular posts over the past week: a screenshot from a pro-crypto Reddit of someone losing $35,000 on DogeCoin; a photo of red and green chiles tracing out Bitcoins trading chart; and one simply headlined 30k finally broken , a reference to Bitcoins recent descent from all-time highs earlier this year. This type of thing is what Amy Castor, a Buttcoin fan and online crypto pundit, calls shitposting. Within the crypto world, there are a lot of ridiculous things that happen, so ButtCoin is a place where you go to poke fun at all that, she says. As you can tell, Buttcoiners arent any more buttoned-up online than their idealist counterparts, and much of the thinking on both sides tends to be pretty simplistic, accepting little nuance. But Buttcoins antics at least arent gyrating financial markets.

Despite two decades of steadily increasing mainstream acceptance, crypto remains an undeniable easy targetsomething that some people love to hate, like say, the tax man and the New York Yankees. Owning it requires a remarkable leap of faith many cannot justify: Theres nothing backing it. It has no value tied to a physical object. Plus, the stuffs super volatile, its value seeming to ping-pong madly on a consistent basis. (Bitcoin, for instance, was worth over $60,000 at one point this year. Today it fetches around half that.) The combination of these elements makes crypto even easier to ridicule than an aging retail chain or an ailing movie-theater business.

McCormicks actions get at the real weightiness of these social media-led financial manias. He didnt believe what he was saying at all. But other people did.

Its not real, actual finance, declares Stephen Brown, 40, a software engineer in Portland, Oregon, one of the moderators of the Buttcoin Reddit group. No one is sure who created Buttcoin almost 10 years ago; Brown and the seven other moderators represent as much authority as it has known since. Theyre just trying to build this other system and replace it with something thats either a joke or a huge bubble.

Brown can seem like something of an anomaly within his own group. He admits to having dabbled in short term trades of crypto over the years, though insists he would never buy and hold for the long haul. Most Buttcoiners are more like another group moderator who would only identify himself by his handle, AmericanScream, or by his preferred pseudonym, Adam Smith. (Since the latter seems rather like unearned aggrandizement, lets refer to him by the former.) AmericanScream attests to never owning any cryptocurrency, and his complaint about the asset class is a familiar one: That it lacks fundamental value, and it can only increase in price if enough people successfully convince more people into buying: Once you hold Bitcoin, PR is all youve got.

AmericanScream, who says he is a 50something semi-retired software engineer, is a near-constant presence on ButtCoin, talking about upcoming changes to Ether, the death of crypto proponent John McAfee and the recent vanishing of two South African crypto-preneurs, whose disappearance could represent the largest scam in the industrys history. Youll see me post at 8 in the morning, sometimes 11 at night, sometimes at 3 a.m., he says, proudly. His prolific publishing has had consequences, he says, and its why he studiously refuses to give his name. He claims to fear that if he did, pro-crypto Redditors would read this, track him down and punish him for his many contrary comments, perhaps by doxing him. Were the little guys saying the emperor has no clothes, he says. People want to shut us up.

Buttcoiners by nature arent afraid to go poke the bear. And Jim McCormick, a 28-year-old from Houston, is another of those types. McCormick discovered Buttcoin only recently, but in one of his first actions to amuse the group, he pulled a prank on a rival crypto-supporting Reddit, publishing several wildly ludicrous posts on the pro-crypto page going bullish on Bitcoin. (In one, McCormick purported to have found a rare Iron Gremlin movement on Bitcoins stock chart, a surefire sign to buy; to be clear, such a thing does not exist.) Not exactly to my surprise but still to my dismay, a lot of people believed it and supported it without a hint of irony or skepticism, he says. Afterward, he posted screenshots of their enthusiastic responses to Buttcoin.

McCormicks actions get at the real weightiness of these social media-led financial manias. He didnt believe what he was saying at all. But other people did, and possibly after reading his faux posts and taking them at face value, they went out and bought more crypto. Now imagine what else has been said across the web over the past yearand whos said it and who has chosen to believe itto get the markets behaving as schizophrenically as they have recently. It was kind of a brief experiment to see if people would be able to distinguish mockery of what they believe in from the actual thing, McCormick says. And to their demerits, I guess they couldnt.

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Inside The Reddit Forum That Wants To See Bitcoin Die - Forbes

Cathie Wood's Ark Invest filed with the Securities and Exchange Commission on Monday to create a bitcoin exchange-traded fund.

Wood a longtime bitcoin bull has been buying up proxies for the digital asset in names such as Coinbase and Grayscale Bitcoin Trust. Now, the innovation investor is seeking to own the actual asset itself.

The ETF's investment objective is to track the performance of bitcoin, according to the SEC filing. The fund would trade under the ticker symbol "ARKB," if approved by the SEC. Ark Invest is working in partnership with 21Shares to launch the ETF.

Bitcoin has hovered around $34,000 for the past couple of weeks as it struggles to reclaim its May highs. Many in the trading community have kept a watchful eye to see if it would hold at $30,000 as it continued its decline. Some still say it could drop as low as $20,000 before rebounding.

However, the digital asset has nearly been cut in half since its all-time high of about $63,000 in April. China's bitcoin crackdown, Tesla CEO Elon Musk's decision to stop accepting bitcoin for its electric vehicles, and excessive risk taking by crypto traders have all contributed to recent price swings.

Ark Invest acknowledged the volatility associated with the digital asset in the "risk factors" section of the filing.

"The market value of bitcoin is not related to any specific company, government or asset. The valuation of bitcoin depends on future expectations for the value of the Bitcoin network, the number of bitcoin transactions, and the overall usage of bitcoin as an asset. This means that a significant amount of the value of bitcoin is speculative, which could lead to increased volatility. Investors could experience significant gains, losses and/or volatility in the Trust's holdings, depending on the valuation of bitcoin," the S1 filing stated.

The SEC last week again postponed a decision to approve the first bitcoin ETF. The latest action comes as SEC Chairman Gary Gensler has called for more regulation of cryptocurrency exchanges and greater investor protections.

So far, there have been eight other bitcoin ETFs filed with the SEC.

Coinbase, the world's largest cryptocurrency exchange, is a top 10 holding in Wood's flagship fund Ark Innovation. Grayscale Bitcoin Trust is a top 10 holding in Ark Next Generation Internet ETF.

Wood has said she sees a future where bitcoin is part of a balanced investment portfolio. Ark Invest estimates that if 1% of the corporate cash of every company in theS&P 500 were converted into bitcoin, then the asset's price would balloon by more than $40,000 from its current levels. If the cash level increased to 10% from each company in the broader stock index, bitcoin's price would increase by more than $400,000, the firm said.

With Gensler a longtime financier who taught a digital currency class at the Massachusetts Institute of Technology being nominated to lead the Securities and Exchange Commission, the watchdog could warm to crypto during the Biden administration, Wood told CNBC earlier this year.

Wood's disruptive innovation funds have recently turned a corner after months of underperformance amid a rotation into value stocks. Shares of Ark Innovation are up more than 16% in June.

CNBC's Tanaya Macheel and Yun Li contributed to this report.

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Cathie Wood's Ark Invest files to create a bitcoin ETF - CNBC

Bitcoin's brief drop below the symbolic price threshold of $30,000 on Tuesday has reignited talk of a crypto winter. It doesn't help that cryptocurrencies like dogecoin, XRP and others saw sharp drops in the last 24 hours.

But experts tell CNBC that bitcoin's fundamentals are good, and the market conditions in 2021 are very different than the last big crypto crash in 2018.

"We are far from a bear market, only traders are freaking out over technicals seen on exchanges like volumes and price action," said popular on-chain analyst and statistician Willy Woo.

Bitcoin's rise in the last 12 months has had a lot to do with the billionaires and corporations that are buying bitcoin in big amounts. The surge in interest from mainstream financial players has not only reformed bitcoin's image but has also fomented a supply shortage, which helped drive up the price of the token.

But since the price of bitcoin peaked over $63,000 in April, the last few months have been rough for the world's biggest cryptocurrency.

China's countrywide crackdown on the nation's bitcoin miners certainly isn't helping.

"Recent news on the China mining shutdown is very reminiscent of China every few years. They've banned banks from using bitcoin, but this is actually different. I've never seen an exodus like this before," said Darin Feinstein, founder of Blockcap, one of the largest bitcoin mining operators in North America.

More than half the world's bitcoin miners are in China, and Beijing has made it clear that it wants them out. In May, the government called for a severe crackdown on bitcoin mining and trading, setting off what's been dubbed "the great mining migration."

"Much of this downward momentum in bitcoin's price has been ascribed to China's latest moves with mining that have led to a lower global hashrate," said Jason Deane, an analyst at Quantum Economics, which specializes in research and analysis on financial markets and cryptocurrency.

"While long-term bitcoiners view this as an extremely positive move for the network ... short-term traders are spooked by uncertainty."

At present, the Fear and Greed Index shows a reading of 10, indicating "extreme fear."

"Markets are often driven by momentum which can sometimes overwhelm fundamentals and the current sentiment seems to reflect that this is what we're seeing here," said Deane.

But Deane and others think it is unlikely to be the start of a so-called crypto winter. Instead, they predict we are headed for a period of overreaction that will correct itself in due course.

"We may never see another crypto winter again," said Mati Greenspan, portfolio manager and Quantum Economics founder. "There's a lot more utility, adoption, and diversification in the industry than we had in 2014 or 2018."

Bitcoin bulls insist the underlying fundamentals of bitcoin are much stronger in 2021, than they were during its last bear market in 2018.

"It's the bitcoin blockchain's more than a decade of unblemished security, bitcoin's breadth of utility, and the level of adoption that establish bitcoin's intrinsic value," said Alyse Killeen, founder and managing partner of bitcoin-focused venture firm Stillmark.

That last point is particularly important -- bitcoin adoption is on a tear, creating a broader group of users who believe in the currency's value, which reinforces it.

"All the network fundamentals are bullish, most of all we are at all-time highs of new user growth," said Woo.

Bitcoin also recently locked its first major upgrade in four years, promising additional functionality, privacy and efficiency.

Short term, bitcoin believers think crypto prices will stabilize at price levels that are still higher than previous plateaus.

"It definitely fits the pattern of crypto assets rising well above previous all time highs, then settling into a new normal for a few years to come while builders continue to innovate on the technology front," said Auston Bunsen, co-founder and CTO of QuikNode, which provides blockchain infrastructure to developers and companies.

Read more here:
Bitcoin drop below $30,000 sparks fears of another crypto winter here's why bulls aren't worried - CNBC

Fundstrat Global Advisors has issued a word of caution to its bitcoin and crypto investing clients, advising them to take some risk off the table, or hedge their bets, over the weekend, due to brewing concerns about mounting leverage in the nascent market.

We think its possible that the selling weve seen over the last day or so is related to concerns over leverage and counterparty risk of some lenders, wrote David Grider, lead digital asset strategist at Fundstrat. Counterparty risk refers to the possibility that a trading partner runs into trouble and is unable to fulfill obligations usually tied to derivatives contracts.

At last check Saturday, bitcoin BTCUSD, -0.07% was trading down over 4%, changing hands at $31,481.62, but off a low, under $30,000, for the worlds No. 1 crypto put in earlier in the week.

Fundstrat, an independent research shop, co-founded by prominent bitcoin bull Tom Lee, pointed to a Thursday tweet by crypto mogul Barry Silbert, who offered his own words of caution about counterparty risk and leverage in crypto that could potentially translate into further turbulence in digital-asset markets.

Silbert warned that there is a daisy chain of borrowers and lenders in the crypto spaceand warned that it is important to understand counterparty risk and where the weak links in the chain are.

Silbert is considered a luminary in the world of digital assets, after founding two of the most widely known enterprises in crypto: Grayscale Investments, which runs the popular Grayscale Bitcoin Trust GBTC, +5.67%, and the Digital Currency Group, which also owns CoinDesk.

See: Heres how much bitcoin is worth, says JPMorgan, as crypto faces this summer headwind

Worries about leverage in crypto come amid the broad swoon in crypto that has taken down values in bitcoin, as well as Ether ETHUSD, -0.59% on the Ethereum blockchain, and meme assets like dogecoin DOGEUSD, -0.69%.

Bitcoin is down over 50% from its mid-April peak, Ether is off 60% from its all-time high in May and dogecoin is down nearly 70% from its record high achieved early last month.

To be sure, the appeal of those assets is their outsize year-to-date returns, with dogecoin boasting an over 5,000% gain so far in 2021, Ether up more than 140% in the first six months of this year.

But those gains have been significantly pared, with bitcoin up a relatively pedestrian 9% on the year, compared with traditional equity benchmarks the Dow Jones Industrial Average DJIA, -0.44%, the S&P 500 index SPX, +0.23% and the Nasdaq Composite Index COMP, +0.98%, which are all up by at least 11% in the year to date. Bitcoin had been up by more than 100% in the spring.

Cryptos recent downtrend has been partly blamed on a crackdown by China on bitcoin mining and trading, but analysts are also warning that the slump may reveal poor positioning by some investors and the dangerous use of leverage, or borrowed money, to amplify returns.

Fundstrat also warned of potential volatility emanating from some popular crypto lending platforms, who promise hefty returns to those depositing digital assets.

We want to remind clients that crypto lenders are not regulated and insured in the same way as banks are with the [Federal Deposit Insurance Corporation]. The FDIC collects fees from member lenders to provide insurance to depositors in the financial institution runs out of cash.

Read: Dogecoin meme crypto Shiba Inu scores modest fillip from Elon Musk Twitter mention

Depositors have counterparty risk to the lenders and if they go insolvent, they could lose their funds, Fundstrat wrote.

At very worst, we get a run on the banks that causes asset prices fall too far, otherwise good lenders could go underwater. We are not expecting thisBut we dont think its a bad idea to take some risk off the table over the weekend, Grider wrote.

Check out: Elon Musk and Jack Dorsey plan bitcoin chat at July event, and ARK Invests Cathie Wood thinks its brilliant

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Crypto analyst warns of weekend tumble, as bitcoin bull points to 'daisy chain of borrowers and lenders' - MarketWatch

Stocks are moving higher on Thursday, extending gains as markets relax about inflation risks and exact details of whats coming from the U.S. Federal Reserve.

The cryptocurrency market is down significantly on the week, having lost $1 trillion of market capitalization from its peak of $2.5 trillion in early May, said a group of analysts led by Nikolaos Panigirtzoglou at investment bank JPMorgan JPM, +0.18%.

Panigirtzoglou and his team have our call of the day, giving bitcoin a fair value of $23,000 to $35,000 over the medium term, based on the relationship between its volatility and golds, as the crypto faces new headwinds.

The signal of the newest major challenge bitcoin faces, according to the team at the investment bank, is that the discount to the net asset value for the biggest bitcoin fund the Grayscale Bitcoin Trust has widened deep into negative territory.

This reflects the anticipated selling of shares in the trust in the secondary market as a lock-up period for investors ends.

As the six-month lock-up period expires in June and July these investors are likely to sell at least some of their GBTC shares exerting downward pressure on GBTC prices and on bitcoin markets more generally, the analysts said.

More broadly, recent volatility and the boom-and-bust dynamics of crypto represent a barrier to the adoption of crypto markets by institutional investors, Panigirtzoglou and his team said.

The mere rise in volatility, especially relative to gold, is an impediment to further institutional adoption as it reduces the attractiveness of digital gold vs. traditional gold in institutional portfolios, the analysts said.

Based on the idea that institutional investors account for the volatility of assets in allocating capital, Panigirtzoglou and his team use a bitcoin/gold volatility ratio to gauge the valuation of the crypto asset.

JPMorgan views bitcoin as having a theoretical target price of $140,000, based on the convergence of bitcoin volatility with gold GC00, -0.22% volatility and the equalization of bitcoin and gold allocations in investor portfolios.

But bitcoin is headed to the milestone of being six times as volatile as gold, giving it a fair value of one-sixth of $140,000, or $23,000.

The best we can hope for over the medium term is for this volatility ratio to partially revert from around x6 currently to around x4 by year-end, the JPMorgan analysts said. The fair value for bitcoin at four times golds volatility is $35,000.

Needless to say, full convergence or equalization of volatilities or allocations is unlikely in the foreseeable future, Panigirtzoglou and his team said.

The chart

Whats the relationship between bitcoin and stocks?

Michael Batnick of the Irrelevant Investor financial blog said he believes it wasnt a coincidence that people were selling everything at the same time in 2020 stocks, bonds, gold, and crypto but dont bet on a crypto crash taking down equities.

Our chart of the day, courtesy of Batnick, show the correlation between bitcoin and the S&P 500 SPX, +0.23% index.

Sometimes when people talk about noncorrelated assets, what they really want are negatively correlated assets. Such a strategy is difficult to find, Batnick said. With noncorrelated assets, you have to take the bad with the good.

Sometimes bitcoin moves with the stock market, and sometimes it doesnt.

The buzz

Elon Musk said he will look to float satellite internet venture Starlink once its revenue becomes predictable, likely in a few years. Replying to a user on Twitter TWTR, +0.53%, the billionaire chief executive of electric-car maker Tesla TSLA, +2.51% said going public sooner than that would be very painful, noting that he would do his best to give long-term Tesla shareholders preference in an initial public offering.

On the U.S. economic front, 411,000 Americans filed for unemployment last week, just a slight decrease from 418,000 in the week prior and more than the 380,000 expected by economists, while there were 3.39 million continuing jobless claims in the week of June 12. Durable goods orders snapped back in May, to 2.3% from -0.8% in the period prior, as the U.S. advance trade deficit widened 2.8% to $88.1 billion May as imports rose 0.8% to $232.4 billion. The pace of growth for the U.S. economy in the first three months of 2021 was calculated at 6.4% year-over-year, unchanged in the latest revision. And the president of the Richmond Fed, Thomas Barkin, said he thinks U.S. inflation pressures are temporary, but that the Federal Reserve must be careful and the central bank shoul watch prices closely.

Shares in data-management company Confluent are set to begin trading on the Nasdaq, after the Mountain View, California-based group priced its IPO well above its forecast range late Wednesday. Confluent priced its shares at $36 each, above the $29 to $33 range estimated by the company last week.

Financial services company Visa has bought fintech group Tink, an open banking platform, for 1.8 billion ($2.15 billion) from Swedish bank SEB.

John McAfee, the maverick software pioneer who created the antivirus software that bore his name, was found dead in his Spanish jail cell on Wednesday in an apparent suicide. His death came hours after a court approved his extradition to the U.S. to face tax charges, which may have seen him face decades in prison.

The markets

U.S. stocks marched higher by midday DJIA, -0.44% SPX, +0.23% COMP, +0.98%, joining the buoyant performance of European equities SXXP, -0.59% UKX, -0.88% PX1, -0.98% DAX, -0.34% and stocks in Asia NIK, -0.73% HSI, -0.05% SHCOMP, -0.23%, which were firmly in the green.

Random reads

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Dirty clothes to the moon: Astronauts dont do laundry in space they wear clothes until they cant take the smell, and then eject them to burn up in the atmosphere. NASA and detergent maker Tide have joined up to change that.

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Heres how much bitcoin is worth, says JPMorgan, as crypto faces this summer headwind - MarketWatch

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Bitcoins recent tumble, which has seen it lose more than half its value, took it briefly below $30,000.

Bitcoin has been tumbling for more than three months now, and the move has started to intensify. The cryptocurrency, which is down 54% from its all-time high of $63,237 hit in mid-April, has fallen as much as 24% in the past 5 days. Bitcoin is now up 9.1% in 2021.

Bitcoin was off just over 1% at $32,243 at 1:25 p.m. after trading as low as $28,600

A decline below $30,000 a dangerous sign according to market technicians. Thats where Bitcoin found support in January before quickly racing to its record high. That $30,000 level is particularly important for Bitcoin, as Barrons recently noted, and if it breaks, Bitcoin has a lot more room to drop.

The question is how much. [If] for any reason Bitcoins critical $30,000 support were breached, it would be vulnerable to decline back to $20,000, The Institutional Views Andrew Addison wrote in Barrons back in May. Instinets Frank Cappelleri, notes that the 61.8% retracement of the entire 2020-21 movean important level when using Fibonacci sequences to determine support and resistance, is near 27,200. ICAP Technical Analysis puts the next important support level at $25,000.

And after that? Look out below. If the price falls to $25,000, the price could sink to $6,000, according to ICAP, an almost 80% drop from its current level. That might seem extreme, but history suggests its realistic. After hitting a high in December 2017, Bitcoin fell 83% before beginning the rally that took it to above $60,000 this year.

Still, with Bitcoin bouncing back, maybe history doesnt have to repeat.

Write to Jacob Sonenshine at jacob.sonenshine@barrons.com

More here:
Bitcoin Is Holding $30,000. Why That's Important. - Barron's

NEW DELHI: Major cryptocurrencies were trading with mild gains on Monday. Crypto traders turned cautious over valuations of digital tokens, following volatility in the previous session. Seven out of top 10 digital tokens were trading with gains at 9.30 hours IST, led by Ethereum.

Britain's watchdog Financial Conduct Authority (FCA) ordered cryptocurrency exchange Binance to stop undertaking any regulated activity in the country, saying the firm lacked authorization. The exchange would not be allowed to undertake any regulated activities without the prior written consent of the FCA.

Mexican billionaire Ricardo Salinas Pliego said his banking business may begin using Bitcoin, becoming the country's first bank to start accepting the cryptocurrency. He is ranked as the third richest Mexican with an estimated fortune worth over $15.8 billion.

Prior to this, Bitcoin will become a legal tender in El Salvador, another South American country in September. It is the first nation to elevate the digital token to the status of a currency.

"The major selloff across the crypto spectrum observed last Friday seems to have subsided for now. Volume data from various exchanges show that several investors bought the dip in the markets over the weekend. However, it cannot be termed as a bullish momentum as the markets are clearly range-bound," said Edul Patel, CEO and co-founder, Mudrex.

"BTC began the day at a decent 5 per cent higher over the previous day. Altcoins continue to be under some selling pressure. Overall, the markets can be expected to remain in consolidation for the short term."

In India, where households own more than 25,000 tonnes of gold, investments in crypto grew from about $200 million to nearly $40 billion in the past year, according to Chainalysis.

Tech View by Siddharth Menon, COO WazirXThe Bitcoin chart has formed the double bottom pattern which is known for the trend reversal. RSI breaking the trendline may be a confirmation of the trend reversal.

Crypto veteran Bobby Lee says Bitcoins recent 50 per cent collapse from all-time highs does not mirror market tops of the past and he expects Bitcoin price to see $100K by end of this year.

(Views and recommendations given in this section are the analysts' own and do not represent those of ETMarkets.com. Please consult your financial adviser before taking any position in the asset/s mentioned.)

Originally posted here:
Top cryptocurrency prices today: Bitcoin, Ethereum, Cardano gain up to 5% - Economic Times

Stocks are pushing higher and crypto is surging, as the slow days of summer trading continue to keep the sun shining on financial markets.

It may not last for long.

Our call of the day, from strategists Barry B. Bannister and Thomas R. Carroll at the equity trading desk of investment bank Stifel, is that the S&P 500 is heading for an 11% pullback while bitcoin could fall to $12,000.

The recovery trade that has defined the recent bull market is headed for a further correction in the second half of 2021, the strategists said. Cyclical stocksindustrials, energy, materials, financials, tech, and discretionarywill fall relative to defensive stocks like staples, healthcare, utilities, and real estate, Bannister and Carroll said.

This will weigh down the S&P 500 SPX, +0.23%, and Stifels strategists say that the blue-chip index is heading for an 11% drop to 3,800 points.

The likely catalysts for this major shift, according to the team at the investment bank, are the U.S. PMI Manufacturing Index fading faster than expected in the second half of the year, and the dollar strengthening.

Bannister and Carroll said the primary causes are a slowing global money supply in U.S. dollar termsas central banks ease pandemic-era supportsas well as distortions from quantitative easing, and the lagged effect of Chinas policy tightening.

A sea change of this magnitude will create distinctive winners and losers, the strategists said. Investors can prepare by buying shares in companies focused on defensive industries: pharma and biotech; food and staples retailing; commercial and professional services; food, beverage, and tobacco; utilities; healthcare equipment and services; household products; consumer services; and telecommunications.

But avoid the stocks set to be losers, identified by the team at Stifel as: banks; insurance; software and services; real estate; energy; diversified financials; semiconductors; technology hardware; materials; capital goods; and autos and components.

Other casualties that Bannister and Carroll expect to see are bitcoin BTCUSD, -0.07% and copper HG00, -0.27%, which are both sensitive to slowing global liquidity and the stronger dollar. The strategists at Stifel see bitcoin falling from around $34,000 to $12,000 if global M2a measure of the money supplydrops to low-single digits year-over-year, as they expect.

The buzz

Tesla TSLA, +2.51% is recalling more than 285,000 vehicles in China, including more than 90% of the cars the company makes locally, because of safety risks associated with the cruise control system, the Chinese market regulator said Saturday. The regulator said an investigation found that the Teslas cruise control system could be accidentally activated and potentially result in an unexpected speed increase.

Its a light day on the U.S. economic front. Investors can expect more questions about inflation when the New York Federal Reserve President John Williams speaks at 9:00 a.m. Eastern, before the Dallas Fed publishes Texas manufacturing outlook survey.

More than 150 people remain missing at the site of the condo building that collapsed in Miami, Florida, early last Thursday, with nine people confirmed dead. No one has been pulled alive from the rubble since hours after the collapse on Thursday.

Over the weekend, the U.K.s lead financial regulator banned Binance, one of the worlds most popular crypto exchange networks, in the latest regulatory crackdown on digital assets. But cryptos have shrugged off the news, with the likes of bitcoin, ethereum ETHUSD, -0.59%, and dogecoin DOGEUSD, -0.69% surging.

European-listed shares in Nokia NOKIA, +5.76% jumped more than 6%, catching up the U.S.-listed stocks NOK, -0.92% rally from Friday after investment bank Goldman Sachs upgraded the telecom equipment maker to buy from neutral.

The markets

U.S. stocks were mixed but mostly higher DJIA, -0.44% SPX, +0.23% COMP, +0.98%, while European equities were broadly lower SXXP, -0.59% UKX, -0.88% PX1, -0.98% DAX, -0.34% along with Asian stocks NIK, -0.73% HSI, -0.04% SHCOMP, -0.23%.

The charts

Investor expectations are way out of whack with reality, according to Michael Batnick, of the Irrelevant Investor financial blog.

Our chart of the day, from investment bank Natixis, via Batnick, shows the expectation gap between financial professionals and individual investors in 17 countriesand that American investors expect 17.5% real returns over the long term.

The S&P 500 has returned 10.4% over the long term. The idea that were going to get 17% real, after getting 17% nominal over the last 5 years, is nothing short of absurd, Batnick said.

Moreover, return expectations have continued to rise year-over-year:

Random reads

Doe, doh! Two Australian men were sunbathing nude on a beach when they were startled by a deerso they ran into a nearby forest, and got lost. Police fined the pair after aircraft and emergency services were scrambled to rescue them.

Ive never seen that many zeros: A couple from Baton Rouge, Louisiana were the recipients of $50 billion mistakenly deposited into their bank account.

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Buy these stocks as S&P 500 heads for 11% correction and bitcoin risks fall to $12,000, say strategists. - MarketWatch