Crypto asset

Speechwriter for Former US President George Bush Says BTC Rally Driven by ‘Historically Low Interest Rates’

23/02/2021 by Idelto Editor

A speechwriter for former U.S. President George W. Bush and a bitcoin critic, David Frum has claimed that the low-interest rates are fueling the crypto asset’s rally. Frum suggests that the crypto asset might experience a “fast and deep price crash” if and when interest rates start to rise.

Institutional Interest in BTC

In comments made via Twitter, Frum, who regurgitates the BTC mining inefficiency claims, also attacks the crypto asset’s store of the value proposition. He states that of “all the pro-bitcoin arguments, surely the worst is the store against inflation.”

Still, despite this criticism, the crypto asset continues to gain support from institutional investors and large companies. For instance, electric carmaker Tesla, which recently amended its investment policy, revealed it had bought BTC worth $1.5 billion.

Furthermore, according to bitcointreasuries.org, the website that tracks companies or institutions that have exposure to BTC, over 1.3 million coins or 6% of the total circulating supply is held by large corporations.

The True Value of BTC

In the meantime, Frum’s remarks about bitcoin have sparked a debate on Twitter concerning the crypto asset’s true value proposition. For instance, in his response to the remarks, Alex Gladstein, the chief strategy officer with the Human Rights Foundation (HRF), reminds the former speechwriter about BTC’s human rights implications. Gladstein, who recently endorsed the crypto asset, said:

Only 13% of humans live under a liberal democracy with a reserve currency. The other 7 billion+ live under authoritarianism or a weak currency. Bitcoin is a powerful tool for them.

Also, another user named Unfettered Nic Carter shares with Frum the other likely outcome of rising interest rates. The user explains that “if interest rates rise, the corporate sector and the government will be insolvent.” Carter then asks: “What do you think is more likely – we bankrupt everything, or we print our way out?”

Meanwhile, other Twitter users like Lepton939 said they were in agreement with the assertion that BTC provides “immunity from inflation.” Nevertheless, this user expresses concern at the crypto asset’s volatility saying:

“Since the price fluctuates so wildly I’m afraid to hold it. But I’m guessing its real value is the scale of illicit transactions it accommodates.”

Still, other users like Jeffrey Smith are praising Frum for making these remarks about bitcoin. In his tweet, Smith remarks:

Exactly. Zero intrinsic value (which is related to your interest rate observation); 100% speculative value (= bigger fool theory); & environmental mess to mine. What’s not to like?

While Smith suggests that “gold is very similar” he is however quick to explain that unlike BTC, the precious metal can be used for making jewelry. He then concludes by saying: “There’s no Bitcoin jewelry as far as I know.”

Do you agree with Frum’s assertion that BTC value will crash once interest rates start to rise? Tell us what you think in the comments section below.

Bitcoin Slides Over 13%, Veteran Trader Peter Brandt Suggests BTC Will Peak at $200k but Hints of Possible Deep Corrections

22/02/2021 by Idelto Editor

Veteran trader Peter Brandt has implied in a tweet that bitcoin will go through deep price corrections before it gets to the $200,000 mark. Brandt points to the 2015-17 bull run when bitcoin went through similar corrections about nine times as the precedent the crypto asset might follow.

More Corrections Expected

Consequently, Brandt is asking his Twitter followers to predict the number of similar 30% price corrections that they expect to see before BTC ultimately gets to the $200,000. Already, as Brandt explains in the tweet, the crypto asset has gone through one such correction since the March 2020 price crash.

Nevertheless, since then the crypto asset, whose price grew by more than 300% in 2020, has been on an upward trend. On February 21, the crypto asset set a new all-time high of $58,228, according to Messari data. As a consequence, some bitcoiners now predict that a price of $100,000 can be achieved in 2021.

In the meantime on Twitter, the reaction to Brandt’s BTC price prediction, as well as his expectation of large corrections, has been mixed. Some users appear to agree with Brandt’s suggestion that there will be many corrections before the $200,000 price is achieved. Still, others think BTC will even surpass $200,000 while many believe the number of corrections will be fewer this time around.

Bitcoiners Expect Fewer Corrections

For instance, in their reply to Brandt, one user named Tho said:

Couldn’t tell, because the end of this bull run is $298,000, not $200,000 and if you ask how many times, the answer is 6 times. it’s mean that 4 more times.

Another user, Mike Thomas says there will be one significant correction at around $100,000. Still, Thomas argues: “With the (increased) amount of coins coming offline, the increased demand, and barring another black swan event, I do think 30%+ corrections are a thing of the past.”

Meanwhile, another user known as Frank Squisher insists that “if the speed of this parabolic rise increases, the next correction could be the last one…If it slows down a bit, we may be able to handle one more big correction before the final run-up.”

Still, not all users are convinced that the crypto asset will make it to $200,000. One such user, London hold asks: “The question is do you think we’ll hit 200k?”

Meanwhile, on Feb. 22, bitcoin (BTC) prices dipped significantly to the $47,500 region after being above the $55k handle for a short period of time. BTC lost 13.63% in value quickly on Monday, but has since regained some of the losses.

Want to follow all the crypto market action in real-time? Check out markets.Bitcoin.com.

Do you agree that BTC will go through many corrections before it reaches the $200,000 mark? Tell us what you think in the comments section below.

Bitcoin’s Watershed Moment- Crypto Asset Now Commands a $1 Trillion Market Capitalization

19/02/2021 by Idelto Editor

Bitcoin’s market capitalization has crossed the $1 trillion zone after the price per coin surpassed $53,650 per unit. The valuation comes 145 months after the launch of the Bitcoin network on January 3, 2009.

‘The First Trillion Is the Hardest’

The price of bitcoin (BTC) has surpassed the territory needed to have a $1 trillion market capitalization. The valuation is a milestone to many crypto supporters who have rallied for the leading currency for the last decade. For the last two weeks, digital currency advocates discussed BTC’s slow and steady approach toward the 1 trillion dollar zone. For instance, on February 16, The Block’s director of research Larry Cermak said:

If Bitcoin hits ~$53,650, it’s gonna be a trillion-dollar asset. Fully diluted it’s already at $1.04T.

Bitcoin's Watershed Moment- Crypto Asset Now Commands a $1 Trillion Market Capitalization — At 10:42 a.m. (EST) the price of BTC touched an all-time high at $53,743.

The conversation about reaching the 1 trillion dollar milestone was a topical conversation all week, as bitcoiners said it was a long time coming. The same day, the software developer, Jameson Lopp, also talked about the $1 trillion event on social media. “The first trillion is the hardest,” Lopp tweeted to his 262,000 followers.

‘Bitcoin Going for Gold Next’

After Lopp made his statement, a number of people compared the decentralized crypto asset’s market valuation to Apple Inc. (AAPL).

It took Apple Inc. around 504 months (42.0319 years) to get to a $1 trillion market valuation one person responded. Another individual mentioned that after Apple captured the $1 trillion valuation, it only took 26 months to reach $2 trillion, which means the ride to a $2 trillion valuation for bitcoin (BTC) very well could be a far less time frame.

Bitcoin reaching a $1 trillion valuation has been a big deal to a number of proponents and many believe the crypto asset is just warming up. The popular creator of the stock-to-flow (S2F) model, Plan B, discussed the watershed moment.

“Straight line up to a $1trillion market cap,” he said to his 269,000 followers. “Bitcoin going for gold next ($10T),” he insisted.

Civic founder Vinny Lingham, often referred to as the oracle, thinks making it to the $60,000 zone might be in the cards.

“Bitcoin looks primed to make a big break above $50k,” Lingham wrote just before the price surpassed the $50k handle. “Once it clears, it will likely test and break $60k quickly. We could find out which [altcoins] are uncorrelated, as there will likely be some carnage in the alt market, if such a big move materializes,” Lingham added.

What do you think about bitcoin reaching a $1 trillion market valuation? Let us know what you think in the comments section below.

Nigeria Crypto Ban: Bitcoin Sells for $76K as Deposits on Centralized Exchanges Plummet

18/02/2021 by Idelto Editor

According to a website that tracks the price of bitcoin across the globe, the crypto asset’s selling price in Nigeria as of February 18 stood at $ 76,000. At this price, the crypto asset is selling for $20,000 more than the approximately $52,000 that most cryptocurrency exchanges are currently quoting.

The Impact of the CBN Crypto Order

This spike in the premium charged on bitcoin follows the recent Central Bank of Nigeria (CBN) directive that targets cryptocurrency traders and exchanges. According to the CBN order, which became effective on February 5, banks and other financial institutions were asked to end relationships with entities that are associated with cryptocurrencies. Since then, many crypto exchanges have seen activity drop drastically as institutions complied with the directive.

News.Bitcoin.com reached out to Chiagozie Iwu, the CEO at Naijacrypto cryptocurrency exchange for his perspective on the surging premium. Iwu starts by confirming that different exchanges have different prices for BTC, and he says this has been necessitated by increased costs of acquiring crypto assets. Before CBN issued the directive, “all crypto exchanges had a unified liquidity source” and this source ensured that getting “naira against crypto was easy.”

However, after financial institutions began implementing the CBN order, the liquidity situation has changed for the worse. As Iwu explains, prior to the CBN order:

Trading in Nigeria was smoother than ever, all exchanges had unified liquidity and the markets were very liquid. There was basically little to no spreads in the market.

As a result of the changes in the liquidity situation, the gap between the BTC price in Nigeria and that across global exchanges has been widening.

Regarding the price disparities, the Naijacrypto CEO says these reflect the cost of getting the naira currency to exchanges. This increased cost, in turn, eliminates any arbitrage opportunities that might exist as a result of the price differences. However, Iwu does concede that for users with “better access” these arbitrage opportunities are real and can be exploited.

Deposits Plummet

Turning to the impact of the CBN order, Iwu also explains how this has badly affected the operations of his company. According to the CEO, deposits on the Naijacrypto exchange dropped by 80% on the day the announcement was made. Before the CBN directive, crypto exchanges had arrangements with banks that enabled “automated deposits” as well as “easy withdrawals.” While activity has since picked up, Iwu reveals that deposits are still 20-25% lower than their usual levels.

The CEO also observes how this CBN order appears to be affecting locally established exchanges more than it has those based outside Nigeria. In explaining this observation, Iwu said:

For the foreign cryptocurrency exchanges its been different since they do not operate from Nigeria so they can flout laws.

Meanwhile, despite the CBN order, which has sent the Nigerian crypto industry back to the “Wild West”, Iwu says he is hopeful that “the ban will be lifted and things will be better than before.”

What else do you think is causing the BTC price in Nigeria to surge? Tell us what you think in the comments section below.

Survey Finds Many Finance Managers Are Not Planning to Hold BTC— Volatility Cited as Key Concern

17/02/2021 by Idelto Editor

A new poll of finance managers by Gartner Finance finds that a majority are not planning to hold bitcoin as a corporate asset. In their responses, most of the 77 finance leaders interviewed cite bitcoin’s volatility as one characteristic of the crypto asset that is “extremely difficult to mitigate.”

The Concerns of Finance Executives

The survey’s findings appear to contradict the growing sentiment that many more listed companies will follow in the footsteps of Telsa, Microstrategy, and Square Inc. In a statement released alongside the survey’s findings, Alexander Bant, chief of research at Gartner Finance reveals that 84% of the respondents believe that “bitcoin’s volatility posed a financial risk.” In addition to the cryptocurrency’s volatility, the executives also name six other areas of concern.

As shown by the survey’s findings, about 39% of the respondents cite their board’s risk aversion as another factor that contributes to the decision not to hold BTC. About 38% cite the slow adoption of the crypto asset as an accepted form of payment or exchange. Regulatory concerns (32%) and lack of expertise in dealing with cryptocurrencies (30%) are the next major reasons cited by the top finance leaders.

Still, the findings suggest that understanding the impact of holding BTC on companies like Telsa and Microstrategy will become a factor for finance managers that may want to follow suit. According to Gartner Finance’s statement:

(About) 71% of respondents said one of the top things they’d like to know is what others are actually doing with bitcoin. (A further) 68% want to hear more from regulators about bitcoin and better understand the risks involved with holding it.

Prospective Buyers Are Not in a Hurry

Meanwhile, the findings also show that 16% of respondents that are willing to adopt cryptocurrency as part of their organization’s financial strategy, appear to be in no rush to do so. Regarding those that have near term plans, the findings show:

Five per cent of respondents indicated they would begin to hold bitcoin in 2021, 1% said they’d hold bitcoin at some point in 2022-2023, and the remaining 9% who indicated they would begin holding bitcoin said it would be 2024 or later.

In the meantime, the survey findings show that “there was no difference in intent to hold bitcoin between small organizations ($1 billion revenue).” Fifty percent of respondents from the technology sector anticipate holding the leading cryptocurrency in the future. Private company finance executives were less favorable towards bitcoin with just 7% saying they would ever hold it.

Do you agree with the findings of this survey? You can tell us what you think in the comments section below.