2021W9 - WTF has happened in bitcoin this week?

Bitcoin is undefeated

Mar 05, 2021

TLDR: Bitcoin is getting regulated and attracting institutional and private investors.

Hey there niblings, its uncle Bam again, with a summary of the most insightful events surrounding Bitcoin. I got to say, I am quite happy for this issue, I am glad to be your filter you need, to digest all the important news for you.

Last week was a crazy one, 22,770 bitcoins out of the market, as we previously told you, over 25 days of mining supply were ripped off from the market, by our boys Saylor and Jack, through MicroStrategy and Square.

This week we saw MicroStrategy taking possession of 533 bitcoins, for about $25 million. This is basically only a little more than half a day of bitcoin daily’s supply. In any case, the statement is clear “We will not stop buying bitcoin, not while it is this cheap” – Michael Saylor (according to Bam’s interpretation)

The great thing is to see that Bitcoin is becoming more normalized. The mainstream media is basically talking about it daily. And every week we get to see a new “bitcoin denier” being converted. In a previous issue, we talked about Mark Cuban stating that bitcoin is better than gold, now we got one of the Shark Tanks, Kevin O’Leary, investing 1.5% of his net worth in bitcoin. Correct, if his net worth is about $400 million, we could speculate that he purchased around $6 million worth of bitcoin.

It is interesting how I still hear some people arguing that “they do not invest in bitcoin, because it could be banned, and then the value could go to zero”. Uncle Bam burns when he hears this statement. Of course, bitcoin being banned is indeed a possibility, we have seen last week in Nigeria, only spiking its price to unprecedented highs. But the truth is, that the trend doesn’t show that direction. We have been following the space, and we can clearly see bitcoin is being not only regulated but adopted. These creates confidence in private and institutional investors. Today, there is no reason to believe that bitcoin might be banned either in Europe or in the U.S.

“Changes in the regulatory environment have changed my mind about participating” – Kevin O’Leary

And this is how the f*#$ing week started:

1. Michael Saylor does it again. This time he bought bitcoin and made two announcements on the same week.

- Monday 1st of March he announced having bought 328 bitcoins for ~$15 million at an average price of $45,710.

- Friday 5th of March, he announced having bought 205 bitcoins for ~$10 million at an average price of $48,888.

2. Kevin O´Leary changes his opinion and says that bitcoin is here to stay. "I am fascinated. I’m investing. I’m holding a 3% weighting in it between Ethereum and bitcoin. The volatility sickens me but I’m getting used to it." - Kevin

3. Citi Bank indicates that bitcoin is at the “tipping point of its existence” due to large institutional investments. Their report suggests bitcoin could "become the currency of choice for international trade”, mainly due to its “decentralized design, lack of foreign exchange exposure, fast money movements, secure payment channels, and traceability”.

4. Coinbase filed for IPO and reported quite astonishing statistics. The platform reached 43 million verified users after adding almost 45,000 new users a day. The average number of monthly transacting users grew by over 30% in the fourth quarter alone, to 2.8 million.

5. Japanese retail giant Rakuten, a mobile payment app which allowed customers to purchase and store bitcoin, is now enabling users to spend their cryptocurrency holdings in everyday transactions without conversion fees between fiat and cryptocurrencies.

6. Goldman Sachs Group Inc. has restarted its cryptocurrency trading desk and will begin dealing bitcoin futures and derivatives for clients from next week.

7. MIT’s Bitcoin Initiative receives initial funding of $4 million in charitable contributions from Jack Dorsey, Michael Saylor and Cameron and Tyler Winklevoss, to “kick off an ecosystem-wide focus on longer-term strategies to harden the underlying protocol”

8. Kentucky lawmakers approve a bill providing tax break for bitcoin miners, aiming to bring more mining operations to the U.S. state.

9. Nigeria climbs up to be the third place in cryptocurrency trading volumes, after their local currency was devalued 24% last year. A survey took place showing that 32% of Nigerians have used cryptocurrencies – highest proportion of any country in the world.

“Some people arrive to bitcoin by coincidence, others through research, and some by necessity” - Bam

10. Square Financial Services begins banking operations. Its primary purpose will be to offer business loan and deposit products, beginning with underwriting and originating business loans for Square Capital’s existing lending product. Basically, Square became an official bank.

FUNDAMENTALS

11. William Clemente shows us the how whales continue to be birthed. Now, these basically means there are more addresses with more than 1000 bitcoins, but we can not disregard that some corporations may be holding multiple of these ones. In any given case, these are good news for the acceptance and adoption of the system.

12. Willy Woo shows us a beautiful chart which basically indicates that the “Hodlers” are gaining strength. The trend shows on the side of the accumulators and not of the sellers. To summarize this, we could argue that we are about to see an appreciation, a supply shock.

13. Jan & Yann, makes an analysis displaying that each bull-run is consisting of 3 major market tops. So far, we have seen only the first one, so basically, there is a chance, a probability, that we are about to see two more waves of appreciation. How far could we go? That is for you to speculate.

But honestly, here in WTFBitcoin, we think we will see prices above $150K per bitcoin this year. Yes, we are bullish.

As a summary note…

Ok niblings, I guess we can say, bitcoin is undefeated. The network effect seems to continue to grow at an exponential pace. It seems that every week, a new public figure is being drawn down to the rabbit hole. Governments seem to be adopting it, from allowing taxes to be paid in bitcoin (Miami), to mining tax benefit, or even creating mining facilities (Iran, Venezuela, Russia). But lets not forget it is the duty of us, the users, to continue growing and protecting the network, from ‘hodling’, running a node, and even spreading the word.

This week I read an amazing piece by Alex Gladstein from the Human Rights Foundation, titled: Can Governments Stop Bitcoin? Short answer: Seems unlikely. In any case, lets dismiss us with this beautiful quote:

“In the end, the only way to kill Bitcoin may be to make it so that people don’t need it anymore. If no one wants a devaluation-proof, censorship-resistant, permissionless, borderless, non-discriminatory, teleporting financial asset, then no one will feed it energy, and it will die. Perhaps humanity can come up with another technology that addresses these needs.
But until then, Bitcoin will thrive.” – Alex Gladstein

Bitcoin is artificially designed to appreciate forever.

Have a great weekend niblings.

Stay humble & stack sats.

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