A rapid-fire string of good news over the past week has help nudge up the price of Bitcoin.
A week ago the Bitcoin price was hovering around $225, which is somewhat disappointing since just six weeks earlier it was threatening to break through the $300 level.
But then we started to get some major positive Bitcoin news. Over the past few days, the Bitcoin price is up about 7%, trading in the neighborhood of $240.
The price of Bitcoin hit a 15-month low of $177 in January and has been fighting to rebound ever since.
The biggest jump came last Thursday, when news broke that Goldman Sachs Group Inc. (NYSE: GS) had joined a $50 million venture capital investment in Bitcoin payments startup Circle Internet Financial.
It was the largest and most direct vote of confidence for Bitcoin from Wall Street yet.
For about a year now, Wall Street has been sniffing around Bitcoin. The Big Banks see Bitcoin as a potential threat, but at the same time realize that they could exploit this new “fintech” for their own gain.
Regardless of the motives, Wall Street’s stamp of approval will grease the wheels of mainstream adoption of the digital currency. That’s why the news had an immediate impact on the price of Bitcoin.
Along with the Goldman announcement, several other pieces of positive news also buttressed the price of Bitcoin.
Price of Bitcoin Also Up on This Exchange News
On Tuesday of last week, Coinbase said it would launch a Bitcoin exchange in the UK. Coinbase already operates a Bitcoin exchange in the United States. About 2.1 million customers in 24 countries use the company’s wallet services.
Coinbase is one of the biggest Bitcoin startups, having raised a total of $106 million of venture capital. It has an estimated valuation of $471 million.
The UK Coinbase Bitcoin exchange is major step toward the company’s goal of becoming a global leader in facilitating the use of the digital currency.
Overstock filed a prospectus with the Securities and Exchange Commission (SEC) to issue as much as $500 million in stock and other securities using the blockchain. The blockchain is the technology that underpins Bitcoin. Using the blockchain as the infrastructure for a stock exchange is one of the many possible uses that have venture capitalists excited about digital currency.
Stocks traded on Overstock’s “Medici” system would not go through either the New York Stock Exchange or the Nasdaq. The SEC filing says the all-digital system could be used to trade common stock, preferred stock, debts warrants, and more.
Finally, Barry Silbert’s Bitcoin Investment Trust (OTC: GBTC) finally started trading today (Monday) on the OTC markets. While not a Bitcoin ETF, the BIT fund does offer a way to invest in Bitcoin without actually owning Bitcoin. It evolved from the Bitcoin hedge fund Silbert created back in 2013.
Volume for GBTC was only 763 shares, but it’s a start. That the price rose 10.53%, from $38 to $42, is another good sign.
A much bigger catalyst for the price of Bitcoin will be the SEC approval of the Winklevoss Bitcoin Trust, a full-fledged Bitcoin ETF. The Winklevoss Bitcoin ETF will make it easy for anyone to invest in Bitcoin.
Approval for the Winklevoss ETF is expected sometime this year.
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About the Author
David Zeiler, Associate Editor for Money Morning at Money Map Press, has been a journalist for more than 35 years, including 18 spent at The Baltimore Sun. He has worked as a writer, editor, and page designer at different times in his career. He's interviewed a number of well-known personalities - ranging from punk rock icon Joey Ramone to Apple Inc. co-founder Steve Wozniak.
Over the course of his journalistic career, Dave has covered many diverse subjects. Since arriving at Money Morning in 2011, he has focused primarily on technology. He's an expert on both Apple and cryptocurrencies. He started writing about Apple for The Sun in the mid-1990s, and had an Apple blog on The Sun's web site from 2007-2009. Dave's been writing about Bitcoin since 2011 - long before most people had even heard of it. He even mined it for a short time.
Dave has a BA in English and Mass Communications from Loyola University Maryland.