Tag: bitcoin

Bitcoin snaps slide while leaving everyone in dark on true worth, BFSI News, ET BFSI

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By Eric Lam

Bitcoin steadied Tuesday after flirting with a bear market in a plunge that left investors grasping for clues about what lies ahead for the world’s largest cryptocurrency.

The digital coin rose as much as 8% to about $36,600, but the move higher pales compared to the gyrations that took Bitcoin to an all-time high of nearly $42,000 on Jan. 8 before a precipitous slump over Sunday and Monday.

The latest bout of roller-coaster volatility recalls past boom and bust cycles including the 2017 bubble, and has investors debating whether this is a healthy correction or the end of the latest bull run for cryptocurrencies.

“We think a pull back is healthy,” said David Grider, lead digital strategist with Fundstrat Global Advisors LLC, who added he doesn’t think the recent price action indicates that Bitcoin has already topped out.

Investors who bought the digital coin a year ago are still sitting on gains exceeding 300%. Pinpointing who is mainly responsible for the rally is one of the many crypto mysteries — Bitcoin funds, momentum chasers, billionaires, day traders, companies and even institutional investors have all been cited.
Just as hard is working out what caused the recent two-day drop of as much as 26%. For some, a bounce in the dollar may be among the reasons. The greenback has snapped a prolonged losing streak after rising U.S. government bond yields bolstered its allure.

“The dollar is showing strength,” said Vijay Ayyar, head of business development with crypto exchange Luno in Singapore.

Ayyar is monitoring what happens if the U.S. Dollar Index climbs to 92 from the current level of about 90. “If the dollar powers through that level then we may have seen a Bitcoin top at $40,000,” he said.

At the same time, the world remains awash with monetary and fiscal stimulus, and some of that wall of money could yet gravitate to crypto assets.

Bitcoin believers continue to tout the digital currency as a viable hedge for inflation risk and the potential debasement of fiat currencies. Some forecasts for its long-term price range from $146,000 to $400,000.

“As long as the world is flooded with money and safe assets offer poor compensation, Bitcoin will be relevant,” Howard Wang, co-founder of Convoy Investments LLC, wrote in a Jan. 10 note. “Volatility and asset bubbles will be a fact of life.”



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Crypto inflows slump after December record -report, BFSI News, ET BFSI

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Investment flows into cryptocurrency funds and products were just $29 million in the first week of January, down sharply from a record $1.09 billion in the week before Christmas, according to the latest data on Monday from asset manager CoinShares.

In addition, the data showed pointed profit-taking from record prices, with some investment products seeing outflows.

Nevertheless, total assets under management (AUM) in the industry stood at an all-time peak of $34.4 billion as of Jan. 8. At the end of 2019, the total was just $2 billion.

Bitcoin plunged more than 19% on Monday, putting it on track for its biggest one-day drop since March as its surge to a record $42,000 last week lost steam.

“Bear market plunges and excessive volatility are powerful agents that scare away the uninitiated,” said Edward Moya, senior market analyst, at OANDA in New York.

“But we are initiated and would like to point out that this was to be expected and that we already saw a near-20% decline earlier last week.”

Inflows into bitcoin investment products totaled $24.3 million in the first week of the year. Ethereum, the second largest cryptocurrency in terms of market capitalization, accounted for $5.3 million, according to the latest available data.

The data showed that investors pumped $15.6 billion into bitcoin products and funds in 2020, while ethereum inflows reached nearly $2.5 billion.

“Bitcoin is still up on the year and the current 22% crash won’t intimidate any of the new institutional money that just hopped onto the crypto bandwagon,” OANDA’s Moya said.

Assets under management in Grayscale, the world’s largest crypto fund, rose to a record $28.2 billion as of last week.

CoinShares, the world’s second largest crypto fund, showed assets under supervision of $3.4 billion. Its XBT Provider line of exchange-traded products hit record trading volumes on Jan. 4 of about $202 million. XBT Provider is a Swedish-based issuer of exchange-traded products listed on Nasdaq Stockholm AB, which is part of Nasdaq Inc and wholly owned by the CoinShares Group.



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Two-day bitcoin plunge shakes faith in cryptocurrency boom, BFSI News, ET BFSI

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The white-knuckle Bitcoin ride took another twist Monday as a two-day tumble in the digital currency stoked concern that the polarizing cryptocurrency boom may run out of steam.

Bitcoin, the largest cryptocurrency, slid as much as 18 per cent over Sunday and Monday to as low as about $33,500. That’s the biggest two-day slide since May last year and follows a record high of almost $42,000 on Jan. 8.

“It’s to be determined whether this is the start of a larger correction, but we have now seen this parabola break so it might just be,” said Vijay Ayyar, head of business development with crypto exchange Luno in Singapore.
Bitcoin’s price has more than quadrupled in the past year, evoking memories of the 2017 mania that first made cryptocurrencies a household name before prices collapsed just as quickly.

True believers in Bitcoin argue the difference this time is the asset has matured with the entry of institutional investors and is increasingly seen as a legitimate hedge against dollar weakness and inflation risk. Others worry that the rally is untethered from reason and fueled by vast swathes of fiscal and monetary stimulus, with Bitcoin unlikely to ever serve as a viable currency alternative.

“Bitcoin is almost certainly in another bubble and its current growth rate is not sustainable,” Howard Wang, co-founder of Convoy Investments LLC said in a Jan. 10 note. “While it may mature in the future, Bitcoin as it exists is largely a speculative asset.”

Bitcoin has shrugged off recent dips and may do so again, potentially recovering to as much as $44,000 “before the actual correction,” Luno’s Ayyar said.

The coin pared some losses Monday and as of 2:03 p.m. in Tokyo was around $35,600. Rival digital assets are also slumping, with second-largest coin Ether tumbling as much as 20 per cent.



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Nifty and Sensex hit its fresh record highs in today’s market rally, BFSI News, ET BFSI

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Nifty bank index traded Green at Rs 32,084 adding 0.40%, while BSE Bankex ended at 36,658 adding 0.46%. The rally in the market was broad-based as the Midcap and Smallcap indices clocked gains of about a percent.

Shares that contributed the most were- Bandhan Bank at Rs 419 adding 3.35% followed by HDFC Bank at Rs 1,431 (1.09%), Kotak Mahindra at Rs 1,970 (0.94%), Axis Bank at Rs 672 (0.24%), ICICI Bank at Rs 542 (0.18%). While all the other major indices remained green, Induslnd Bank at Rs 939 (-1.29%) and SBI traded lower at Rs 286 (-0.59%).

Nifty Financial Services ended at 15,511 adding 0.56%. Amongst the top gainer were Indiabulls HSG at Rs 241 adding 3.08%, followed by Bajaj finserv at Rs 9,171 adding 2.02%, Power Finance at Rs 120 (1.38%), Cholamandalam at Rs 431 (0.10%). HDFC Shares traded lower at Rs 2,657 (-0.14%).

Other key takeaways

India’s GDP to contract by 7.7% in 2020-21: Government
The central government projects the country’s economy to contract by 7.7 percent in the current fiscal year 2020-21, as per the first advance estimates of GDP released by the National Statistical Office on January 7.

“The movement of various high-frequency indicators in recent months, points towards broad-based nature of resurgence of economic activity. The relatively more manageable pandemic situation in the country as compared to advanced nations has further added momentum to the economic recovery,” the government said in a press release.

Bitcoin hit $40,000 for first time and falls by 5% a day later
Bitcoin topped $40,000 for the first time on Thursday, as it continues a rally that has seen the digital currency climb more than 700% from a March 12 closing low.

Bitcoin fell more than 5 percent on Friday, a day after topping $40,000 for the first time. The world’s most popular digital currency fell as low as $36,750 on Bitstamp exchange, after reaching an all-time high of $40,402.46 in the previous session

Rupee trades flat
Indian rupee erased early losses and traded flat around 73.32 per dollar, amid buying witnessing in the domestic equity market. It opened lower at 73.39 per dollar against Thursday’s close of 73.32.

Gold Updates
Gold prices traded down with COMEX spot gold prices fell below USD 1,890 per ounce on Friday losing more than 1 percent. Gold February future contracts at MCX were trading down to Rs 50,242 per 10 grams with fall in COMEX prices. Experts Expect gold prices to trade down with COMEX gold resistance at USD 1,910, support at USD 1,860. MCX Gold February support lies at Rs 49,700 with resistance at Rs 50,400.

Wall St ends higher:
Stocks on Wall Street hit record levels on Thursday as investors bet a Democrat-controlled Congress will deliver more stimulus spending to help the U.S. economy overcome a steep pandemic-induced downturn.

The Dow, S&P 500 and Nasdaq all set new highs amid growing calls for President Donald Trump’s removal, one day after Trump supporters stormed the U.S. Capitol in a harrowing assault on American democracy.



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Nifty Bank & financials trade in green; ICICI, Kotak Mahindra Bank top gainers, BFSI News, ET BFSI

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Nifty bank index traded at Rs 31,797 adding 0.24%, while BSE Bankex ended at 36,396 adding 0.34%. Shares that contributed the most were – RBL Bank at Rs 284 adding 5.40% followed by ICICI Bank at Rs 546 (1.80%), SBI at Rs 284 (1.12%), Kotak Mahindra Bank at Rs 1,970 (0.55%), federal Bank at Rs 72 (0.55%). While all the other major indices remained green, Axis Bank at Rs 654 (-1.48%) and HDFC Bank traded lower at Rs 1,420 (-0.43%).

Nifty Financial Services ended at 15,393 adding 0.09%. Indiabulls HSG was the top gainer at Rs 220 adding 0.32% followed by Power Finance at Rs 118 (0.13%). Shares that traded lower were- Bajaj Finance at Rs 5,030 (-1.73%), Cholamandalam at Rs 434 (-0.55%) and HDFC at Rs 2,638 (-0.49%).

Other key takeaways

India receives highest FII inflows in 2020
Indian equities received more than Rs 1.6 lakh crore ($23 billion) from foreign institutional investors in 2020, the highest among emerging markets. In fact, most Asian and emerging markets witnessed outflows in the year gone by. This was the second year in a row when FII inflows into Indian equities were highest among emerging markets. In 2019, the inflow was $14.2 billion.

Bitcoin breaks above $35,000 to touch new high
Bitcoin traded above $35,000 for the first time in Asia on Wednesday, rising to a high of $35,879 and extending a rally that has seen the digital currency rise more than 800% since mid-March.The world’s most popular cryptocurrency crossed $20,000 for the first time ever on December 16.

Rupee trades flat
Indian rupee erased the gains and trading flat at 73.18 per dollar, amid selling seen in the domestic equity market. It opened flat at 73.17 per dollar against Tuesday’s close of 73.17.

Gold Updates
On the Multi-Commodity Exchange (MCX), February gold contracts were trading lower by 0.31 percent at Rs 51,561 per 10 gram at 0920 hours. March silver was trading 0.72 percent lower at Rs 70,346 a kilogram.

Gold has support at 51440-51200 and resistance is placed at 52000-52200 levels. Silver has support at 70200-69500 while resistance is placed at 71500-72200 levels. Gold and silver extend gain on Tuesday amid weakness in the dollar index and 7-weeks lockdown in the UK. Both the precious metals were settled on a positive note.



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Bitcoin falls after a spectacular rally; what led to this?, BFSI News, ET BFSI

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Bitcoin took a downfall around 17% after a long rally which began in March 2020 with touching new highs around $34,800 a whopping 800% increase.

However, the world’s most popular cryptocurrency sank 17% wiping out the gains which were made over the start of 2021.

Sumit Gupta, Co-Founder & CEO at CoinDCX, India’s largest crypto-exchange said, “Bitcoin’s growth is largely attributed to how it is designed and in May 2020, we witnessed third halving , a supply shock event, where the number of daily mined Bitcoin gets cut in half. In the previous 2 halvings, Bitcoin and overall crypto market cap has risen exponentially, and a similar trend is expected this time around.”

The adoption came largely from institutional investors and institutions across the globe.

Sumit explained how Microstrategy included Bitcoin in their company’s treasuries and payment rails like PayPal, Square are integrating cryptocurrencies due to rising demand from retail investors. He added, “In 2021, if the increase in Bitcoin’s demand continues we can expect even greater demand from institutional investors, hedge funds, family offices, and from retail investors as well.”

Arjun Vijay, Co-Founder & COO at Giottus Cryptocurrency Exchange has noticed more and more BTC leaving exchanges across the world, 19% more transfer than the 2017 price increase, which is a signal that investors are holding BTC as long-term investments. UK-based Ruffer investment, a recent example of investors looking to hedge their investment, had invested 2.7% of its AUM in Bitcoin in November 2020. Even Insurance companies like MassMutual, the Massachusetts insurance firm with $235 Billion in AUM, dipped its toes into Bitcoin with a $100 million purchase.

Vijay believes that with more players joining the bandwagon we will be noticing more price increases in the days to come. Also, a lot of new investors are waiting for a correction to enter this rally but Bitcoin price growth has been relentless all this while.

On the crash of 2018, Sumit noted, “This is the first time we are witnessing such a huge demand from such large players at such a scale. This is significantly different from 2017, where the huge demand was primarily from retail investors, followed by a crash in 2018.”

If the global demand from institutions and investors continues, we might see higher price action in coming months and years.



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Bitcoin falls most since March as volatility grips trading, BFSI News, ET BFSI

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Bitcoin fizzled in Monday trading as the famously volatile cryptocurrency pulled back after a spectacular rally.

Prices sank as much as 17% in the biggest intraday retreat since March, wiping out gains made over the weekend. After a parabolic 2020, the digital currency had started the new year with a bang, surging as high as $34,000 and hitting all-time highs.

As ever in the world of crypto, it’s hard to pinpoint the proximate cause for the latest bout of volatility. Still, Bitcoin is up more than 300% over the past year, driven by a speculative fever from retail and institutional investors on the belief that cryptocurrencies are emerging as a mainstream asset class and can act as a store of value.

Believers in Bitcoin have pointed to the market’s supply constraints and supposedly rampant money printing by central banks as key drivers of bullish narrative. Others say that cryptocurrencies are a bubble in the making and another sign that crazy risk taking has taken over global markets.

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Bitcoin trades near Sunday record of $34,800 following 800% surge, BFSI News, ET BFSI

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By Kevin Buckland

TOKYO: Bitcoin traded at $33,365 in Asia on Monday, after soaring to a record high of $34,800 on Sunday as investors continue to bet the digital currency is on its way to becoming a mainstream asset.

The latest milestone for the world’s most popular cryptocurrency came less than three weeks after it crossed $20,000 for the first time, on Dec. 16, and bitcoin has now surged some 800 per cent since mid-March.

With bitcoin’s supply capped at 21 million, some see it as a hedge against the risk of inflation as governments and central banks turn on the stimulus taps in response to the Covid-19 pandemic. Some also view it as a safe-haven play during the Covid-19 pandemic, akin to gold.

“Some of it is reflecting the fear of a weaker dollar,” Bank of Singapore currency analyst Moh Siong Sim said of the most recent rally.

“It seems like people are preferring bitcoin as an expression of concern over currency debasement, relative to gold.”

Bitcoin’s advance also reflects increasing expectations it will become a mainstream payment method, with PayPal opening its network to cryptocurrencies.

The potential for quick gains has also attracted demand from larger US investors, as well as from traders who normally stick to equities.

“The rally gained even more momentum as insatiable investors continued trading from home” during the New Year holidays, said Dave Chapman, Executive Director at Hong Kong based digital asset company BC Group.

Institutional investors see the potential for greater risk-adjusted returns compared to traditional investments, he said.

Bitcoin trades on numerous exchanges, one of the largest of which is Coinbase, itself preparing to go public to become the first major US cryptocurrency exchange to list on Wall Street.

Multiple competitor cryptocurrencies use similar blockchain, or electronic ledger, technology. Ethereum, the second biggest, shot to a record $1,014 on Sunday.



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Wall Street revives dream of Bitcoin ETF with new SEC filing, BFSI News, ET BFSI

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For years, regulators have quashed hopes of a Bitcoin exchange-traded fund, citing worries about everything from market volatility and industry manipulation to thin liquidity. Just like Bitcoin itself, issuers keep fighting back.

VanEck Associates Corp. has started a new push to launch an ETF tracking the world’s largest digital currency, according to a filing Wednesday to the U.S. Securities and Exchange Commission. The VanEck Bitcoin Trust would reflect the performance of the MVIS CryptoCompare Bitcoin Benchmark Rate.

It’s a bold move for the New York-based firm. There have been multiple applications for crypto-tracking ETFs over the years, and the SEC has denied them all.

VanEck may be betting that a change in SEC leadership — with Jay Clayton stepping down as chairman — combined with Bitcoin’s growing adoption on Wall Street have improved the odds of regulatory approval, according to analysts.

“All indications from the SEC are that a bitcoin ETF still faces an uphill battle,” said Nate Geraci, president of the ETF Store, an investment advisory firm. “That VanEck has the confidence to file for a Bitcoin ETF might indicate some shifting viewpoints within the SEC. Clearly, a key to watch as this drama continues unfolding is who President Biden taps as SEC chair.”

VanEck’s filing comes in a week when Bitcoin has continued to set record highs. The world’s largest digital asset has advanced about 300% this year, catching the attention of some of Wall Street’s most famous investors, including Paul Tudor Jones, as well as mainstay firms like PayPal Holdings Inc.

While crypto fans see its rally continuing, many are also aware its high-profile surge could attract greater scrutiny. The new SEC chair may take a softer line than Clayton, but President-elect Joe Biden has nominated Janet Yellen as Treasury secretary. In the past she has described Bitcoin as a “highly speculative asset” and “not a stable store of value.”

“By filing now, it will restart the clock for a review when there will be new SEC membership and leadership,” said Todd Rosenbluth, director of ETF research for CFRA Research. “However, I think the SEC has made it clear they have concerns that need to be overcome.”

According to the filing, VanEck’s ETF plans to hold Bitcoin and will value its shares based on prices contributed by exchanges that MV Index Solutions GmbH believes represent the top five exchanges for the cryptocurrency.

Bitcoin was trading 0.3% lower at around $28,800 as of 7:49 a.m. in New York.

Such an ETF “could be taken as bullish for Bitcoin because it does broaden the universe of investors who could be aware of Bitcoin,” said Everett Millman, finance expert with Gainesville Coins.



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XRP cryptocurrency tumbles as Coinbase exchange moves to suspend trading, BFSI News, ET BFSI

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Cryptocurrency XRP slumped 19% on Tuesday after Coinbase, a major U.S. virtual coin exchange, said it would suspend trading in the digital currency.

California-based Coinbase said on Monday it would suspend trading in XRP after the U.S. Securities and Exchange Commission (SEC) last week charged an associated blockchain firm, Ripple, with conducting a $1.3 billion unregistered securities offering.

Ripple has rejected the charges, saying XRP is a currency and does not need to be registered as an investment contract.

XRP, the third-biggest cryptocurrency, was last down 18.7% at an intra-day low of $0.20, its lowest since July. It has slumped by over half since the SEC move.

The move by Coinbase comes as it prepares for a stock market listing, with a confidential application to the SEC to go public. It would be the first major U.S. crypto exchange to list on the stock market.

Coinbase, one of the most well-known cryptocurrency platforms, said trading in XRP moved into limit only from Monday, and would be fully suspended on Jan. 19.

Financial regulators around the globe are still grappling with how to regulate bitcoin, XRP and rival cryptocurrencies. Investors are watching for regulatory developments that could determine whether cryptocurrencies leap from a niche to a mainstream asset.

XRP, which often moves in tandem with Bitcoin, had rocketed in November to hit its highest level since 2018 as a rally in cryptocurrencies gathered pace.



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