2021W17 - WTF has happened in bitcoin this week?
Bitcoin is the most liquid asset
TLDR: Bitcoin recovers ground above $55,000, athletes getting paid in bitcoin, restaurants accepting bitcoin and central banks recognizing bitcoin as money.
Hey there niblings, it’s uncle Bam again, with a summary of the most insightful events in the Bitcoin space. Back at it again digesting all the important news for you.
Last week was a tough one for many new ‘hodlers’. In the last issue of WTFBitcoinW16 I explained by sharing a thread some of the reasons of the sudden price fall that we lived. I got calls from friends and family, wondering what was happening. “Bam, is this hype over?”, “Is bitcoin appreciation done?”, “Bam should I sell?”… The best strategy is to stack, relax and enjoy the ride.
It is interesting how we humans tend to have short memory. Last weekend the price oscillated around $48,000, and many were losing their minds. Mainstream media was coming with clickbait articles declaring bitcoin’s death, and it’s entering into a “bear market”, just as if we had not see this before. People who preach anti-bitcoin ideas were dancing and claiming victory, as Bitcoin’s price drop as low as $47,000 after having visited $64,000 just some days ago. In other words, we saw a completely normal correction, in terms of historical price swings, but for some, it was chaos, and there was fear in the streets.
Why do I say that we have short memory then? Well the price immediately recovered its ground, and push to highs of around $58,000 and everybody is enjoying themselves, and feeling bullish again.
It is definitely not a bad thing to be bullish, in fact, we have a million reasons to be so, just as all the interesting news we share here with you every week. But let’s focus on one question that many people have.
Can Bitcoin go higher?
Uncle Bam thinks so. There is a specific metric shared by William Clemente, the Realized Price.
The Realized Price, is basically the average price of all the bitcoins evaluated at the price they were last moved. Right now we are still under $20,000, which is significant because this represents the top of the last cycle. In the previous cycle, this metric suppressed the previous ATH, when bitcoin was trading around ~$3200, and the price ran up generating ~600% returns from that point.
Now this does not mean that it is a guarantee that we will see 600% returns in the short term, but might as well be an indication that we are nowhere near the top for now, and things might start to get heated…
And this is how the week started.
0. Gaming company Nexon has bought $100M Bitcoin, the largest amount by a listed Japanese company.
1. JPMorgan Chase will offer an actively managed bitcoin fund to certain clients, becoming the largest U.S. bank to embrace bitcoin as an asset class.
The JPMorgan bitcoin fund could roll out as soon as this summer. Institutional bitcoin shop NYDIG will serve as JPMorgan’s custody provider.
2. “Demand on the crypto side has been multiple-fold to what we initially expected. There's a lot of excitement.” - Dan Schulman, CEO of Paypal
3. Coinbase hit a record high in downloads after their IPO.
4. Kansas City's Sean Culkin just became the 1st National Football League player to be paid entirely in bitcoin. His entire contract of $920,000 will be paid using Zap, by Jack Mallers.
5. Trevor Lawrence has signed an endorsement deal with cryptocurrency portfolio management app Blockfolio. He accepted his signing bonus in bitcoin and other cryptocurrencies.
6. George Residence, a luxury hotel in Lagos, Nigeria , will adopt Bitcoin as a form of payment and its primary reserve currency as concerns about inflation continue to grip Africa’s largest economy. They will become the first Nigerian hotel to accept Bitcoin payments.
“Bitcoin permits our guests a faster and more secure way to enjoy the comfort we offer. Our residents desire simplicity, and we are excited to be able to offer that to them.” - George Residence
7. Iran’s central bank says Bitcoin from licensed miners can be used by banks to pay for imports.
8. The Central Bank of the Arab Emirates has described crypto currencies, such as Bitcoin, as money.
9. Germany will allow 4,000 investment ‘Spezialfonds’, managing $1.8 Trillion,to invest up to 20% in Bitcoin and other crypto.
10. Muscle Maker Inc. publicly traded company (Nasdaq: GRIL), announced it will start accepting bitcoin as an alternative to cash, credit or debit forms of payment.
11. Bequia, a small caribbean island, is becoming the world's first fully Bitcoin-enabled community. Bitcoin will be accepted for everything, from real estate to the grocery store.
12. Kari Due-Andresen, the Chief Economist in Norway at Handelsbanken, just went public announcing that she believes in bitcoin, and she holds the asset.
13. Tilman Fertitta announced that most of his Landry's restaurant brands will soon accept bitcoin as payment.
As a summary note..
Bitcoin is proving to get adopted every week by different players and different countries. This week we saw Tesla announcing in their Q1 results they sold 10% of their bitcoin holdings. This was immediately criticized in the media, to which Elon came out to made things clear.
Now some people might argue that this is not true, that they were basically taking profit. But think about it for a second, Tesla sold at an unknown time for us 10% of their holdings, and the price did not tanked in any crazy way. This is a great message for their stakeholders who were not on board on this decision. Tesla just proved they own one of the most liquid and appreciating assets ever existed.
Who knows what will happen next, maybe they will even buy more.
Have a great weekend niblings.
Stay humble & stack sats.
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Reference:
0. https://www.bloomberg.com/news/articles/2021-04-28/nexon-joins-tesla-in-bitcoin-bet-with-100-million-purchase
1. https://www.coindesk.com/jpmorgan-to-let-clients-invest-in-bitcoin-fund-for-first-time-sources
2. https://time.com/5957001/paypal-cryptocurrencty-bitcoin-dan-schulman/
3.
4.
5. https://www.marketwatch.com/story/trevor-lawrence-expected-to-be-the-no-1-pick-in-the-nfl-draft-signs-endorsement-deal-with-crypto-app-blockfolio-11619457969
6. https://cointelegraph.com/news/nigerian-hotel-becomes-country-s-first-to-accept-bitcoin-payments
7. https://www.coindesk.com/iran-central-bank-money-changers-imports-mined-crypto
8. https://centralbank.ae/sites/default/files/2020-11/Stored%20Value%20Facilities%20%28SVF%29%20Regulation%20AR%20%26%20EN.pdf
9. https://decrypt.co/69323/damn-huge-germany-opens-up-to-institutional-crypto-funds
10. https://www.globenewswire.com/news-release/2021/04/29/2219759/0/en/Muscle-Maker-Grill-Now-Accepting-Bitcoin.html#:~:text=(Nasdaq%3A%20GRIL)%20the%20parent,or%20debit%20forms%20of%20payment.
11.https://www.euronews.com/2021/04/26/this-small-caribbean-paradise-is-set-to-become-the-world-s-first-fully-bitcoin-enabled-com
12.
13. https://www.msn.com/en-us/money/companies/tilman-fertitta-says-most-of-his-landrys-restaurant-brands-will-soon-accept-bitcoin-as-payment/ar-BB1g7khB