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This week in Bitcoin price: Feb 9-16

Published on February 16, 2021

The big picture

Even if you’ve become accustomed to major Bitcoin news breaking almost every day this year, the past week has been particularly action-packed. On the morning of February 16, Bitcoin prices briefly broke the $50,000 mark for the very first time — eclipsing the previous all-time high set just last week, following Tesla’s announcement (via a SEC filing last Monday) of a $1.5 billion investment in the cryptocurrency.

Also in the wake of the Tesla announcement, a slew of banks and other institutions — including some of Wall Street’s most historic names — announced Bitcoin news of their own. As the Wall Street Journal reported, “Bank of New York Mellon Corp., the nation’s oldest bank, is making the leap into the market for bitcoin, a sign of broader acceptance of the once-fringe digital currency." (The bank plans to hold and transfer the digital currency for its clients.) Similarly, Bloomberg reports that Morgan Stanley’s $150 billion investing arm “may bet on Bitcoin.” And for the second time this year, Bitcoin was featured on the front page of the Financial Times, under the headline, “Is Bitcoin going mainstream?”

Key points

Alongside Morgan Stanley’s announcement, the investment bank’s chief global strategist Ruchir Sharma published a blog post that made a strong case for Bitcoin’s enduring utility as a store of value. “Cryptocurrencies are here to stay as a serious asset class,” he noted, adding that the base of support for Bitcoin is only growing among younger investors and emerging markets. “Traditionalists [who] continue to dismiss the seriousness of the crypto challenge at their own risk.” 

  • While Bitcoin has seen its value swing by 20 percent or more in a single day recently, a Bloomberg analysis suggests that its volatility has gone down compared to the last bull run in 2017: “What makes the current run-up different than four years ago is a wider belief that Bitcoin will develop into mainstream asset class and the backing of big investors, such as Paul Tudor Jones and Stan Druckenmiller.”

  • The city of Miami (whose mayor, Francis Suarez, has emerged as a major proponent of crypto), passed a resolution to study the feasibility of paying workers and collecting taxes in Bitcoin, in addition to potentially holding the asset in the city’s treasury.

  • Former presidential candidate Andrew Yang — who currently leads polls in the race for New York City mayor — has made Bitcoin part of his pitch to voters: “As mayor of NYC — the world’s financial capital — I would invest in making the city a hub for BTC and other cryptocurrencies,” he tweeted

  • According to a recent interview with its CFO, Twitter has been looking into paying employees and vendors in Bitcoin, and is considering adding the cryptocurrency to its corporate treasury. (Twitter CEO and founder Jack Dorsey is also the founder and CEO of Square. The payment processor became one of the first publicly traded companies to  add Bitcoin to its balance sheet, when it made a $50 million investment early in the current bull run.)

  • Bitcoin proponents in North America have long pushed regulators to approve crypto-based “exchange traded funds” (or ETFs), which would allow investors to access Bitcoin and other cryptocurrencies via traditional brokerages as easily as buying stock. This week Canada’s securities regulator approved the nation’s first Bitcoin ETF, raising hopes that the U.S. will follow suit.

  • Following last week’s news that Visa will open its platform to cryptocurrencies including Bitcoin, Mastercard declared that it will support “select digital assets”. (Details around which assets will be accepted remain unclear.)

  • New York-based asset manager Ark Invest — which has around $50 billion under management — boosted its holdings of Grayscale Bitcoin Trust (GBTC) by 2.14 million shares this week. Ark now holds around 7 million shares of Grayscale’s main crypto fund (worth around $357 million). GBTC allows investors to buy, sell, and hold Bitcoin indirectly. Ark analysts believe that Bitcoin’s trend of institutional adoption will continue following Tesla’s purchase.

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