Bitcoin Banks Coming

BITCOIN’S 40,000 MPH SPEED BUMP

If you didn’t check the price of bitcoin this week, you would be forgiven for thinking that nothing happened of consequence. However, it had a very volatile couple of days. After staying above $40,000 for much of January 10, by the next morning bitcoin was threatening to fall below $30,000. Additionally, this sudden fall led to double-digit drops in many altcoins, such as ether, litecoin and XRP. In what could only be considered perfect timing, the U.K.’s financial regulator issued the following statement, “As with all high-risk, speculative investments, consumers should make sure they understand what they’re investing in… If consumers invest in these types of product, they should be prepared to lose all their money.”

That said, as it has done countless times in the past, by midweek the market had come back around. On Thursday bitcoin recrossed $40,000, albeit briefly, and ether started to threaten its all-time high price of $1,432. Now that crypto is back to the line of scrimmage, analysts are trying to determine what lies ahead. Many analysts are predicting that bitcoin will bounce around $40,000 until a new direction becomes clear. That said, crypto will probably get a short-term boost from additional stimulus coming out of Washington.

BITCOIN HOARDERS HAVE THE LAST LAUGH

Sometimes vindication is more valuable than material gain. But it does not hurt when it comes with a giant mountain of cash, or crypto. When the market crashed at the end of 2017, outside observers thought that crypto’s moment was over, destined for the dustbin with all the other bubbles that have burst over time.
However, as the world dealt with Covid-19, the industry roared back to life, richly rewarding many true believers that held and grew their holdings during the crypto winter. Now, some of crypto’s biggest backers are ready to take a victory lap, many as newly-minted billionaires.This 180 is probably sweetest for Cameron and Tyler Winklevoss, the founders of Gemini and early backers of Mark Zuckerberg, who each own more than $1.5 billion worth of crypto.

AN END TO THE ERA OF GOOD FEELINGS?

During an interview at a Reuters conference, the president of the European Central Bank (ECB), Christine Lagarde, noted that bitcoin had some “funny business” and asked for a global layer of regulation for bitcoin.This sentiment is not original. After all, crypto has had to deal with a perception that it is primarily geared towards illicit actors. However, this statement came with some crucial context, principally that the ECB is making progress on its own digital currency.

In fact, it came at the same time as the ECB releasing the results of the end of public consultation around the digital euro, as well as a statement from Christine Lagarde that the digital euro was likely to come about in the next five years. However, despite the open process being undertaken by the ECB, crucial questions remain about the level of privacy that will be protected by a digital euro, one of the key value propositions underpinning cryptocurrencies.

Source : Forbes