In brief
- Crypto markets rose on renewed investor confidence.
- Bitcoin surged on the news Goldman Sachs was reopening its crypto trading desk.
- Tech stocks also rallied after the Federal Reserve assuaged investor concern around inflation.
The market recovery continued across crypto today as assets are enjoying renewed confidence from investors.
Global market cap gained 5% in the last 24 hours, putting it back above $1.5 trillion. Total market cap has gained $200 billion in the last 48 hours after last week’s rout.
Bitcoin is up 2% at the time of writing. Overnight its gains were as high as 8% thanks to reports Goldman Sachs is reopening its crypto trading desk after shuttering it during the crypto winter of 2018.
Goldman Sachs to Resume Trading Bitcoin Futures in Mid-March
Goldman Sachs has revived plans to open a trading desk for cryptocurrency, and will begin dealing Bitcoin futures contracts in mid-March, a person close to the banking giant told Decrypt on Monday. The decision, first reported by Reuters, is significant because it reflects how the biggest names on Wall Street are coming to view cryptocurrency as part of their day-to-day operations. It's also notable because Goldman Sachs announced plans for a crypto trading desk in 2018 but then quietly shelved...
There was also news that big Bitcoin buyers MicroStrategy had added another $15 million worth of the cryptocurrency to its already sizeable $4.3 billion stash. The Saylor Super Cycle theory appears to be continuing - more on that in another post.
MicroStrategy Invests $15 Million in Bitcoin—Adding to $4.3 Billion Stash
Business intelligence firm MicroStrategy has bought another 328 Bitcoin ($15 million) at an average price of $45,710, according to a statement today. This brings its total Bitcoin holdings to 90,859 Bitcoin, currently worth around $4.3 billion. In total, the firm has paid $2.186 billion for its enormous stash of cryptocurrency. This represents a 96% gain, so just shy of double. While the firm has made significant profits on its earlier investments, its recent purchases have been at much higher p...
The two day rally brings the world’s biggest crypto asset back above $900 billion, but it's still someway from the dizzy heights of the $1 trillion mark it hit in mid February.
Most projects in the crypto top 20 experienced a similar bump. Ethereum is up 5.3%, Binance 7.4%, and Chainlink 12.49%. The only noticeable exception was Cardano, which is down 5.45%. It’s performance over the past week has trended in the opposite direction from the rest of the market place.
The renewed confidence in the markets came as a direct result of the US Federal Reserve’s announcement yesterday that it will continue to buy at least $80 billion in government debt every month until America’s employment rate recovers and inflation reaches 2%.
Fed's Plan for 'Open-Ended Stimulus' Is Like an Ad for Bitcoin, Analysts Say
The United States Federal Reserve has no plans to curb coronavirus stimulus packages, it announced yesterday. The stimulus packages, long feared to plummet the value of the US dollar, could make a strong case for Bitcoin, analysts told Decrypt. The Fed announced yesterday that it would continue to buy at least $80 billion in government debt each month and keep interest rates near zero until the unemployment’s down and inflation averages 2% again. The Fed thinks that it could take years until th...
According to its projections, that could take years meaning money printing is likely to go on until around 2023. This open-ended spending helped tamper down those pesky Treasury Bond yield rates that rattled the markets last week, and lead to a surge in spending on assets in both the fiat and crypto markets.
In the US, the Dow closed up, as did the S&P 500. The tech centric Nasdaq reported its best start to a month in a year, thanks to a boom in tech stock performance.
Apple closed up more than 5%, Tesla up 6.2%, Paypal, up 5.2% and Facebook up a smidge below 3%. Zoom is also up 10% after it posted earnings reports at the top end of expectation.
These “growth stocks” have ridden the COVID wave of unlimited Federal spending for nearly a year now, as investors looked to them to deliver better performance than the markets at large.
And thanks to the words of support from the Fed, Apple et al are being eyed up as stocks with yet more growth to come.
Why Bitcoin and Stocks Went Wild During A Global Recession
When historians look back on 2020 and ask what will it be most known for, there are two stories they could tell. On the one hand, 2020 could be defined by a planet rocked by a pandemic that caused millions to die, and an economic fall out that will be felt long after a vaccine is rolled out. On the other hand, historians might say that 2020 was the year investors and their returns took off into the stratosphere. In particular, Bitcoin’s record-breaking price surge, and the American stock market...
As we’ve seen previously crypto courts the same type of cyclical investors as those who have gone big on tech stocks in the last 12 montsh: buyers with an appetite for risk, short to mid-term investment horizons who are happy to spend as long as there’s a federal safety net to keep confidence high.
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