Bitcoin's Amazing Week
$66K Bitcoin! ETFs Approved! Putin a Bitcoiner, who knew?
Bitcoin Prices Smashes New All-time High, over $66,000
Bitcoin hit a new all-time record price on Wednesday, and did so in smashing fashion. See that chart below, a dizzying ascent past $66,000. The previous all-time high was achieved this May, at just over $64,000.
Spurred by the approval by the SEC of the first US-based Bitcoin futures ETF, buyers came out in force. As many analysts have been saying since July, long-term holders (HODLers) of Bitcoin have been remaining strong, not selling for anything. Short-term traders, weaker hands, have been flushed out, and as such a supply squeeze was inevitable. Anyone following the on-chain analytics of Will Clemente III and Willy Woo could see this coming for the past two months.
To put this price in perspective, one year ago, Bitcoin’s price was $13,031. An increase of 400%! I feel like not enough people zoom out and realize what a run Bitcoin has been on for the past year. There’s more: A year and a half ago, Bitcoin was at $5,922. No other asset class can boast that kind of meteoric rise. Woulda, shoulda, coulda.
I captured a magnificent screen shot on Wednesday of the sudden rise of Bitcoin’s price, shown below. Right place, right time. I probably should have been working.
Bitcoin Futures ETF Starts Trading
On Tuesday, ProShares debuted its recently-approved Bitcoin Futures ETF (BITO). With over $1 billion in volume on its first day, BITO’s launch was the second biggest ever for an ETF, behind only the Invesco QQQ Trust.
Monday marked the end of the 75-day review period for the fund, and the SEC gave it the go ahead to start trading. Approval of an exchange-traded fund is considered a major step in advancing widespread adoption of Bitcoin and other cryptocurrencies.
The ProShares Bitcoin Strategy Fund will not buy and hold actual Bitcoins, but rather will track the price of Bitcoin futures traded on the Chicago Mercantile Exchange. Nonetheless, the fund and others like it will make Bitcoin exposure available to most any investor with a brokerage account. The SEC actually prefers the futures-based funds for Bitcoin, since they eliminate any fears concerning security and custody issues around the underlying assets.
Bitcoin maximalists, however, contend that these futures-based ETFs won’t perform as well as the underlying Bitcoin asset will during rising markets. In other words, investors may feel they have a Bitcoin exposure, but could receive lesser performance than they could by buying Bitcoin directly.
Second Bitcoin Futures ETF, from Valkyrie, Debuted Wednesday
The Valkyrie Bitcoin Strategy exchange-traded fund was the slated to become the second US-based Bitcoin ETF to hit the market, one day after ProShares. Before this week, the new fund was slated to trade under the ticker symbol “BTF.” In a late switch, however, fund management changed the symbol to “BTFD,” much to the delight of many Bitcoin fans. The online Bitcoin community, when prices fall a bit, enthusiastically encourage investors to “Buy The Dip.” From BTD, it takes little imagination to know what the Bitcoin Twitter crowd is saying when the phrase “BTFD” is used. IYKYK.
Said Leah Wald, Valkyrie CEO, the firm “decided to make the change in a nod to the broader crypto community.” The Bitcoin crowd has always been a bit different. However….at the eleventh hour, Valkyrie decided to revert back to the originally-chosen ticker symbol, BTD.
More Bitcoin Adoption - Morgan Stanley, Goldman Sachs, Citigroup
Sorry, Jamie Dimon.
Shortly after Dimon, CEO of JP Morgan & Co., questioned the Bitcoin cap of 21 million coins and called Bitcoin “useless,” (See last week’s issue!) his industry counterparts came out with positive statements and made plans to roll out new crypto products for their investors.
Morgan Stanley CEO James Gorman acknowledged the power of blockchain technology and doesn’t feel that crypto is going away.
“I don’t think crypto’s a fad. I don’t think it’s going away.” Also, “these things aren’t going away and the blockchain technology supporting it is obviously very real and powerful.” - James Gorman.
Morgan Stanley was the first major Wall Street bank to allow its customers to trade cryptocurrencies and has invested some of its own money in crypto. Literally putting its money where its mouth is. Citigroup announced that it is looking to begin trading cryptocurrencies through one of its own funds very soon. Goldman Sachs already has a derivative product that allows qualified clients to trade crypto assets.
Vladimir Putin to Don Laser Eyes?
It was Russian Energy Week in Moscow, and Russian President Vladimir Putin was asked by CNBC if he thought Bitcoin could replace the US dollar in settling oil trades. “I believe it has value,” said Putin. While saying it was too early to know if Bitcoin would replace the dollar, Putin “was clear about his efforts to become less reliant on the US dollar for international trade,” according to the New York Post. Putin also commented:
“Cryptocurrency has the right to exist and can be used as a means of payment” - Vladimir Putin.”
Bitcoin Magazine - Look who got published in BM!
Link: Bitcoin Magazine October 17th
Issue No. 26, October 22, 2021
Rick Mulvey is a CPA, forensic accountant and crypto consultant. He writes about all things Bitcoin, and yells at the Yankees and Giants. He also runs marathons and makes wine, neither professionally.
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