How many shares of Apple Inc. (NASDAQ:AAPL) could you buy with a single bitcoin? This week the value of the bitcoin rocketed up over the price of a single share of Apple and is now trading at around the price of two Apple shares. And the digital currency shows no signs of slowing down, hitting $1,168 at Mt. Gox today, another new high, and continuing to climb as I write.
Bitcoins are also on the cusp of hitting $1,000 on Coinbase, a major U.S.-based exchange and digital wallet where bitcoins have been trading for less than at Mt. Gox. But Coinbase is rapidly catching up.
Here’s what Charlie Munger had to say at the Daily Journal meeting
Charlie Munger spoke at the Daily Journal Corporation's Annual Meeting of Shareholders today. Although Warren Buffett is the more well-known Berkshire Hathaway chief, Munger has been at his side through much of his investing career. Q4 2020 hedge fund letters, conferences and more Charlie Munger's speech at the Daily Journal meeting was live-streamed on Yahoo Read More
Apple and bitcoins at a crossroads
What’s especially interesting right now about Apple Inc. (NASDAQ:AAPL) and bitcoins is that they are both at a key crossroads. The news is a key driver for what makes stocks and currencies rise or fall, and both of them have become key focuses on Wall Street.
Regulators are interested in bitcoins, and the Chinese just can’t get enough of them. And Apple broke out of its holding pattern and looks ready to hit a new year-high. The company’s stock hasn’t traded as high as it is now since January.
Apple to battle bitcoins in payments
And then there are the indications that Apple Inc. (NASDAQ:AAPL)’s and bitcoins’ fates are intertwined within the payments industry. Analysts have been clamoring for some time that Apple needs to get into the payments industry and leverage that massive database of credit card numbers it has on file through iTunes. Now that the iPhone 5S is out with its often-not-working TouchID fingerprint scanner, people seem to want payments services even more on Apple products, particularly with the use of the fingerprint scanner.
In their recent meetings about bitcoins, U.S. regulators made some very interesting comments which are undoubtedly one of the reasons why the digital currency’s value is skyrocketing. Several of them commented about how bitcoins could be used for payment processing. So many investors are probably jumping on the bandwagon here because this digital currency could be the next big player in the payments industry.
Or could it?
Apple moves against bitcoin
Back in June, Forbes contributor Jon Matonis noticed that Apple Inc. (NASDAQ:AAPL) was taking steps to avert bitcoins’ success in the payments industry by removing payment apps which use the digital currency. Blockchain Wallet and BitPak were both removed from the Apple App Store. The company said apps “must comply with all legal requirements in any location where they are made available to user.” As Matonis notes, there are no laws right now—at least in the U.S.—regarding bitcoins, so appears to be nothing more than a standard form response aimed at diverting the real questions. He also discovered that Apple was barring the use of another micro-payment service called Flattr from its App Store, saying that donations “must be done via a web site in Sadari or an SMS.”
Perhaps the most interesting exception to Apple’s push against other forms of digital payment is PayPal, but it’s clear that the company would do more harm to itself than good by blocking PayPal payments. So will bitcoins ever gain the notoriety which would make it impossible for Apple to keep them out of the App Store? We could be heading in that direction right now.