Bitcoin Rockets Upward, Thanks To China

Bitcoin Rockets Upward, Thanks To China
geralt / Pixabay

Bitcoin prices have climbed over the last 30 days or so, mostly thanks to investors in China, according to Ben Rooney of CNN Money. According to Mt. Gox, perhaps the world’s most well-known bitcoin exchange, the digital currency has traded for between $356 and $391 today.

The Winklevoss twins voiced their support of bitcoins today at the DealBook conference, saying they think the currency is worth 100 times its current trading value. They’ve been one of the currency’s most outspoken advocates over the last few months.

David Einhorn At The 2021 Sohn Investment Conference: Buy These Copper Plays

david einhorn, reading, valuewalk, internet, investment research, Greenlight Capital, hedge funds, Greenlight Masters, famous hedge fund owners, big value investors, websites, books, reading financials, investment analysis, shortselling, investment conferences, shorting, short biasThere's a gold rush coming as electric vehicle manufacturers fight for market share, proclaimed David Einhorn at this year's 2021 Sohn Investment Conference. Check out our coverage of the 2021 Sohn Investment Conference here. Q1 2021 hedge fund letters, conferences and more SORRY! This content is exclusively for paying members. SIGN UP HERE If you Read More

Bitcoin sees ups and downs

This year has certainly been one for ups and downs in the bitcoin market. The currency only exists online and is mined by specialized computers which solve math problems to discover certain algorithms which turn out to be bitcoins. The currency is not currently regulated, and once the world’s computers discover all of the limited number of them which will ever exist, there will be a fixed amount of them to go around.

First Cyprus, now China

The role played by the world’s economies in the value of the bitcoin has been interesting. Scared investors in Cyprus while the country was going through its bailout earlier this year put their cash into bitcoins, helping their value surge earlier this year. They were concerned about how stable the euro would be, so they opted for digital currency instead. After the Cyprus situation had been quieted, bitcoin prices dropped, also being helped by the closing of the online drug den Silk Road and technical problems at Mt. Gox.

Suddenly, bitcoins are hot again, and ConvergEx Group market strategist Nick Colas told CNN Money that there’s strong demand for them in China right now. He says Chinese demand has been the currency’s major driver, and this is clear in bitcoins’ volume charts.

Mt. Gox no longer world’s biggest bitcoin exchange

Interestingly enough, Mt. Gox no longer holds the title of being the world’s largest bitcoin exchange by volume (better tell them to change their website!). Last week BTC China passed Mt. Gox in global trading volume for bitcoins.

China’s state-run media recently reported favorably on bitcoins. Also China’s most popular search engine Baidu Inc (NASDAQ:BIDU) said it would start accepting bitcoins as payment. SecondMarket, which owns Bitcoin Investment Trust, called Chinese demand for the currency “staggering.” BIT is the first U.S.-based investment fund dedicated to bitcoins. SecondMarket founder and CEO Barry Silbert said they’re starting to see “the early signs of money coming into bitcoin as an asset class.” BIT has racked up $15 million since it launched only about two months ago.

What will regulators do with bitcoins?

There have been some concerns about putting money into bitcoins. After all, the transactions are untraceable and we now know that hackers can steal bitcoins stored in the cloud. Regulators from more than one agency have been considering just what to do with the digital currency. For now, though, there’s little they can do about them. The Federal Reserve Bank of Chicago said recently that bitcoins could “eventually be used by banks and governments.” When that happens though, you can bet regulators will be putting their mitts all over them—somehow.

No posts to display