Signs of a widening embrace across the financial services industry sent bitcoin to new heights, with the cryptocurrency closing in on US$50,000 for the first time before falling back.
A week after Tesla announced its US$1.5 billion investment in bitcoin, the digital asset continues to make inroads into traditional finance, including news that an investment unit of Morgan Stanley is considering whether to bet on bitcoin. Canada also approved the first North American bitcoin exchange-traded fund.
And there is evidence that more companies are beginning to add services for cryptocurrencies — an asset class that is still lightly regulated and controversial among policymakers. On Thursday, BNY Mellon said it formed a new team that is developing a custody and administration platform for traditional and digital assets. Mastercard Inc has said it will begin allowing cardholders to transact in certain cryptocurrencies on its network.
The combination of luminaries like billionaire Elon Musk and powerhouse banks is adding fresh ammunition to bitcoin’s meteoric gains. The cryptocurrency neared US$50,000 in weekend trading before retreating. Prices are up 40 percent this month, and were at about US$46,800 as of 11am in Hong Kong yesterday.
“The key for bitcoin’s path higher is to win over more corporate endorsements,” Oanda Corp senior market analyst Edward Moya said. “Bitcoin is no stranger to massive weekend moves and the next several days could easily see some wild swings.”
There remains a fierce debate over whether bitcoin is a legitimate asset with any real purpose or value. The token has been derided for its role in money laundering and scams, and recently Nassim Nicholas Taleb, author of The Black Swan, said he is getting rid of his bitcoin. A currency is never supposed to be more volatile than what you buy and sell with it, Taleb said on Twitter, adding that you cannot price goods in the cryptocurrency. “In that respect, it’s a failure (at least for now).”
Even so, the price trend has been up, and bitcoin stands as another example of the speculative excesses that are defining this bull market — along with penny stocks and cannabis companies.
There are hints that more Wall Street heavyweights could dip into the crypto market. In an interview with CNBC, JPMorgan Chase & Co co-president Daniel Pinto said that client demand is not there yet on bitcoin, but he’s certain that’ll change.
Bloomberg reported that Counterpoint Global, a unit of Morgan Stanley Investment Management, is exploring whether the cryptocurrency would be a suitable option for its investors, according to people with knowledge of the matter. Moving ahead with investments would require approval by the firm and regulators.
“With each major announcement like the one BNY Mellon made, other institutions are spurred to more rapid adoption and deployment of digital assets,” Patrick Campos, chief strategy officer at Securrency, a developer of blockchain-based financial and regulatory technology, said on Friday.
“Tesla’s recent announcement will embolden other large corporates and institutions to accept crypto as not just a worthy asset class, but perhaps even an essential one,” he said.
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TEMPORARY TRUCE: China has made concessions to ease rare earth trade controls, among others, while Washington holds fire on a 100% tariff on all Chinese goods China is effectively suspending implementation of additional export controls on rare earth metals and terminating investigations targeting US companies in the semiconductor supply chain, the White House announced. The White House on Saturday issued a fact sheet outlining some details of the trade pact agreed to earlier in the week by US President Donald Trump and Chinese President Xi Jinping (習近平) that aimed to ease tensions between the world’s two largest economies. Under the deal, China is to issue general licenses valid for exports of rare earths, gallium, germanium, antimony and graphite “for the benefit of US end users and their suppliers
Dutch chipmaker Nexperia BV’s China unit yesterday said that it had established sufficient inventories of finished goods and works-in-progress, and that its supply chain remained secure and stable after its parent halted wafer supplies. The Dutch company suspended supplies of wafers to its Chinese assembly plant a week ago, calling it “a direct consequence of the local management’s recent failure to comply with the agreed contractual payment terms,” Reuters reported on Friday last week. Its China unit called Nexperia’s suspension “unilateral” and “extremely irresponsible,” adding that the Dutch parent’s claim about contractual payment was “misleading and highly deceptive,” according to a statement
Artificial intelligence (AI) giant Nvidia Corp’s most advanced chips would be reserved for US companies and kept out of China and other countries, US President Donald Trump said. During an interview that aired on Sunday on CBS’ 60 Minutes program and in comments to reporters aboard Air Force One, Trump said only US customers should have access to the top-end Blackwell chips offered by Nvidia, the world’s most valuable company by market capitalization. “The most advanced, we will not let anybody have them other than the United States,” he told CBS, echoing remarks made earlier to reporters as he returned to Washington
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