• Bitcoin’s value has now soared by 364 per cent over the last year to $45,791  
• Apple, Google and Twitter have been touted as potential future investors 
• A major issue with cryptocurrency is its vulnerability to wild price swings

Bitcoin’s value hit another record this week after Elon Musk’s electric car company Tesla revealed its $1.5billion (£1.1billion) investment in the cryptocurrency and said customers would soon be able to buy its vehicles with it.

The virtual currency’s value has now soared by 372 per cent in the last year to over $45,000, and remains way out in front of other digital currencies.

But what does Tesla’s purchase mean for Bitcoin and the wider cryptocurrency market? Is this investment a sign of how the business world is about to change?

Why has Tesla put its money into virtual currency?

In a filing with US authorities, Tesla said it had changed its investment policy to ‘provide us with more flexibility to further diversify and maximize returns on our cash that is not required to maintain adequate operating liquidity.’

Buying Bitcoin and promising to accept it in payment form soon is part of that strategy, as is a possible investment in other reserved assets like gold bullion.

Tesla thinks its Bitcoin holdings are ‘highly liquid,’ though it admitted that digital currency prices can become very volatile, and could hurt them should they need to be liquidated.

Simon Peters, a cryptocurrency analyst at eToro, says he thinks Tesla’s action ‘cements a long-term interest in Bitcoin’s potential,’ partly through its use as a bulwark against traditional currency devaluation.

Will other big corporate names follow Tesla in?

Digital currencies are becoming increasingly popular with businesses, both as a means of transaction and investment. 

Twitter founder Jack Dorsey has a lot of Bitcoin on the balance sheet of his mobile payment company Square, while Silvergate Bank revealed in its latest earnings report that it had about $5billion of digital currency, most of it in Bitcoin. 

Peters says: ‘Twitter has revealed it has laid the groundwork for the integration of Bitcoin into its business, strengthening the long-term prospects for the world’s largest cryptoasset.’

‘Amid all the doubts around its use in the real world, the simple fact is people want alternatives to the existing financial system. They want democratisation of money and Bitcoin and other cryptoassets represent a chance to achieve that.’

‘We would expect many more companies to follow suit by both integrating Bitcoin into payrolls, or by investing in it as part of a diversification of their balance sheets.’

Tesla’s announcement sent shares in other virtual currency investors higher, such as software giant MicroStrategy, which bought $250million of Bitcoin in August and now has over 71,000 of them on hand.

Many analysts, including Eric Turner of cryptocurrency research firm Messari, also believe Tesla’s investment will encourage more companies to follow suit.

Apple and Google are rumoured to want to get involved, while Paypal is already in the process of rolling out full Bitcoin integration for its millions of users.

Read more: This is Money

Bitcoin has soared to trade at an eye-watering $48,000 (£34,820), following the news that Tesla has bought $1.5bn of the crypto-currency.

Enthusiasts will tell you it’s the future of money – but investing in the notoriously volatile virtual currency can be a rollercoaster, and it’s not without risk. The hunt for new coins, using powerful computers, is also causing a surge in energy demand – which is not so good for the environment.

Here are some of your Bitcoin adventures.

‘It paid for a holiday in Iceland’

James Saye, tech consultant

I first invested in Bitcoin in 2017 – I was nervous about putting too much in, so I went for around £500.

I cashed it in for £2,500 during one of its peaks, and had a great holiday in Iceland – the cash came in handy, Iceland is lovely but expensive.

I bought in again in 2018 when the price was lower so I’m still in but I don’t regret cashing out when I did.

‘It’s part of my pension plan’

Heather Delaney, founder of Gallium Ventures

I’ve been the silent crypto-investor. I put in £5 at the very beginning and I’ve built it slowly and steadily over time. I see it as a long-term strategy, meaning the rapid highs and lows are not ones that cause me anxiety – although ask me as I near my retirement and we shall see what I think then!

Based on how much I have invested in Bitcoin over time versus what I see today, I have a 585.41% increase in my investment.

I’ve never cashed it out – but I have converted some to other currencies as the market has fluctuated.

I know loads of people who have done exciting things with their investments but for me it’s part of my pension plan. I know I’m not typical.

‘He didn’t get a single penny back’

David Stubley, founder of 7 Elements cyber-security firm

We had a client whose Bitcoin wallet was fraudulently accessed and all the money was transferred out of it. He had intended to use it as a deposit on a house.

The man had been spooked by reports of fluctuations in the currency and decided to check his wallet. But he clicked on a fraudulent link, which led him to a phishing site, a complete clone of the real thing.

He had 84 bitcoins, and the fraudsters transferred 83 of them. At the time, in 2017, they were worth $475,000.

We tracked the payment on the blockchain [a kind of shared digital public ledger] – we could see it rolling across various wallets and finally it reached a wallet containing $15m of currency.

While the final identity of the fraudsters could not be identified, we were able to have the wallets frozen, so at least denying access to the stolen funds.

Our client was irate but philosophical. Today, that stolen Bitcoin would be worth £2.8m.

Once it’s gone, it really has gone.

Read more: BBC

• The conversion of cash to Bitcoin is a threat to traditional currencies.
• The U.S. may impose a ban on cryptocurrencies if a threat is seen. 

Recently, the rate of Bitcoin investments in the U.S. has become increasingly worrying for its administration, with reports suggesting that a decision to ban the use of cryptocurrencies may arise. A famous analyst in the U.S. said that the government might have no option other than to regulate the digital currency once seen as a threat to the nation’s fiat currency, the dollar.

Bitcoin investments dominating markets

After Elon Musk’s Dogecoin tweets, Tesla is the recent top name to show interest in cryptocurrency. Presently, Tesla’s Bitcoin purchase is topping the charts as per Bitcoin investments. Now, every crypto investor is looking to convert cash into BTC. However, the cash conversion may have a negative effect on the value of the dollar. 

Last year, an analyst from JP Morgan spoke about Bitcoin investments. He claimed Grayscale’s GBTC investment dominated Gold ETF distribution in two years, thereby predicting that Bitcoin’s value will dominate the digital market and Gold will only come close. 

Bitcoin investments a real source of insurance for organizations

The recent investments in BTC by top companies like MicroStrategy and Tesla are a good source of insurance. However, these investments are threatening to destroy the value of the dollar. In contrast to the value of USD, Bitcoin is looking to hit $50000. If the trend of converting BTC to cash continues, the value of the dollar may yet decrease. 

Presently, the value of BTC is rising at a high rate, and it is expected that the quality of Bitcoin investments will increase as well. Tesla’s BTC acquisition is just a start as the world should expect more companies to follow suit. With more billionaires looking to add Bitcoin to their portfolios, the fiat system may be at the brink of extinction. One question that persists will be when or if cryptocurrencies may eventually end the reign of fiat currencies. 

Read more: Cryptopolitan

• Mike Novogratz makes new Bitcoin price prediction.
• Novogratz’s previous Bitcoin price prediction.

Popular Hedge investor and founder of crypto firm Galaxy Digital Michael Novogratz has said that Bitcoin price would hit $100,000 this year. He predicts that every company in the U.S would invest in Bitcoin this year.

The investor who said this in a Bloomberg interview reacted to Tesla’s recent Bitcoin investment. He said Tesla CEO, Elon Musk, is a genius for listening to people and investing in Bitcoin. “You’re going to see every company in America do the same thing. It doesn’t have to be a lot. It’s the messaging that matters, you’re seeing the herd here, and it’s coming, he said.

Why firms would invest in Bitcoin

The investor said that U.S firms would invest in Bitcoin as a Hedge investment and because of a falling dollar. He noted that a rising generation includes cryptocurrencies, Tesla, Solar stocks, and ESG investing. Novogratz said that young people are buying into the future as they see crypto as their currency.

He revealed that his firm’s coins are now worth over $760 million after they invested $134 million to buy 71,079 coins. He also said the richest man in the world has now invested in cryptocurrency, which he predicts has seen CEOs’ and CFOs’ thinking about investing in the crypto asset.

Michael Novogratz previous Bitcoin price prediction

Last year, the hedge investor predicted that the price of Bitcoin was going to hit $65,000 as he advised Maisie Williams to invest in the crypto asset. While responding to Maisie’s poll on Twitter on if she should buy Bitcoin, Novogratz said he expected the price to hit $20,000 before getting to $65,000 because of a “network effect” in which there are a ton of new buyers and low supply.

“So YES, buy it,” he said.

Back then, Bitcoin was priced around $18,480. Bitcoin began to surge in October when PayPal announced it would allow its users to buy, sell, and hold the cryptocurrency on its network. The price gained 70 percent in August alone last year. Novogratz has long advocated Bitcoin and said he expected its price to keep increasing as more people warm up to the idea of adding it to their portfolio.

Read more: Cryptopolitan

The conventional media has expressed mixed emotions about Elon Musk and Tesla’s move into the world of crypto – announcing yesterday that it purchased bitcoin (BTC) worth USD 1.5bn and hinting the carmaker may be set to start accepting crypto pay.

In a damning assessment, Guardian financial columnist Nils Pratley bristled at the idea of Telsa and Musk foraying into crypto, suggesting the latter should “leave punting on bitcoin to the devotees.” “Tesla should stick to what it’s good at,” he wrote, “and that isn’t bitcoin.”

Pratley added,

“The move […] looks like pure speculation. […] This adventure looks to be mostly about Musk’s taste for disruption and publicity.”

Also in the UK, the Financial Times waded into the argument, calling the investment a “bet” and quoting Jerry Klein, managing director at Treasury Partners, a New York-based investment management firm, as stating that the move made “no sense” and was “risky.”

Economist Campbell Harvey, a professor at Duke University, agreed that the move “won’t necessarily provide that hedge that [Musk and Tesla] are looking for.”

Meanwhile, Berlin-based Bloomberg columnist Chris Bryant took a slightly more sympathetic view, writing,

“Accounting rules were created before cryptocurrencies were invented. The bean counters don’t want to be blamed if companies get their fingers burned. Still, with interest rates at zero, I doubt Tesla will be the last tech company to try to earn a better return on its cash holdings.”

Read more: Cryptonews

BITCOIN’s price has surged to a new historical high, sparking the panic of the European Central Bank’s President Christine Lagarde, whose recent comments have exposed a “widespread misunderstanding” among policy makers, a political commentator has claimed.

The President of the European Central Bank (ECB), Christine Lagarde, has announced she wants to regulate cryptocurrencies. Ms Lagarde expressed her concerns and scepticism, saying: “It is not a currency. Cryptocurrencies are not money. “It is a highly speculative asset.”

The ECB President then underlined the lack of guarantees of real stability, as in the case of the euro or the dollar.

Explaining the risks consumers are exposed to, Ms Lagarde continued: “It is imperative that, if an activity is carried out by a private actor, this activity, if it is similar to money, is subject to exactly the same rules, exactly the same rations, exactly the same control mechanisms.

“So even if they are not money, but are ‘similar’ to them, the rules for cryptocurrencies and fiat currencies must be the same.”

In a recent report, the head of Oxford-based think-tank Euro Intelligence Wolfgang Munchau hit out at Ms Lagarde, arguing her comment “goes to the heart of the misunderstanding of the economics and central bank professions about the nature of Bitcoin“.

He wrote: “It will not be up to them to decide whether or not it is money.

“That question will be settled by those who use it.

“Fiat money is a social contract that exists because people trust it.

“The betting on Bitcoin, including Elon Musk’s €1.5billion (£1.1bn) investment, constitute a bet that this might not always be so.”

Mr Munchau noted the world may only be a couple of policy mistakes away from an environment in which the use of digital money, Bitcoin and others, could become more widespread.

He explained: “Bitcoin is not only a bet against inflation like gold or silver. It is a bet against a system in which money is used as a policy tool. It is no surprise that the launch of Bitcoin, in 2009, coincided with the advent of quantitative easing.

“The widespread misunderstanding of policy makers is that the intention of Bitcoin was never to create a rival to the euro or the dollar but to create a device that protects from economists and central bankers or governments that want to track electronic payments.

“The group of techies who started the project with an article in 2009 saw Bitcoin as a device to protect individuals from state control of all kinds – by creating a stateless currency that could be used in transactions and a store of value.

Read more: Express

• Mike Novogratz says many companies in America will eventually add Bitcoin to their balance sheet.
• He also thinks that the price of the cryptocurrency will double in value as more firms will hold BTC.

The founder and CEO of Galaxy Digital, Mike Novogratz, is among the many crypto industry players that believe Tesla’s move to Bitcoin (BTC), the largest cryptocurrency, would be an eye-opener for other companies to buy BTC. The electric car company allocated $1.5 billion of its cash reserve to the cryptocurrency. Novogratz is optimistic that many other companies in the United States will follow suit.

Mike Novogratz foresees Bitcoin doubling in price

At the time of writing, Bitcoin was trading at $46,495 on Coinmarketcap, with a market valuation of over $865 billion. The cryptocurrency is more likely to double in value as the herds gradually arrive, the Galaxy Digital CEO told Bloomberg Television. “You’re seeing the herd here, and it’s coming,” Mike Novogratz said, adding that every company in the United States will eventually hold Bitcoin. “It doesn’t have to be a lot. It’s the messaging that matters.”

Mike Novogratz applauded Elon Musk’s decision to listen to the people, saying he is a genius. “Now you got the biggest, the wealthiest man in the world and one of the biggest stories doing it. […] You’ve got to think other CFOs and CEOs are saying, what should we be doing?”

What company is next?

Mike Novogratz and other prominent industry players are pretty much confident that more companies will follow Tesla, with Apple being at the top list. RBC Capital Markets thinks that the tech giant will be the next big company to add Bitcoin to its Balance sheet. They also think that Apple will debut their own digital currency exchange and wallet. 

Read more: Cryptopolitan

• Bitcoin spikes to $47,450 for the first time after closing the day above $40,000.
• The technical breakout eyes $53,620, suggesting that the top is nowhere near.
• BTC’s list resistance path is still on the upside as projected by the MACD.

Bitcoin resumed the uptrend on Monday after confirming support at $38,000. Closing the day above $40,000 also encouraged more buyers to join the market. The flagship cryptocurrency broke past the previous all-time high at $42,000, pushing the bullish leg above $45,000.

The rally was unstoppable towards $50,000 but Bitcoin stalled slightly above $47,000. At the time of writing, the bellwether cryptocurrency is trading at $45,780 after making a minor retreat from the new record highs at $47,450.

Short-term analysis on the 4-hour chart suggests that Bitcoin’s list resistance path is still upwards. For instance, the upward trend has been reinforced by the Moving Average Convergence Divergence (MACD). The technical indicator is moving higher above the midline at the same time the MACD line (blue) shows that Bitcoin is still in a buy zone.

At the same time, an inverse head-and-shoulders pattern has formed on the same 4-hour chart. This pattern is bullish and currently suggests that Bitcoin has some distance to cover before hitting the target at $53,620.

Therefore, trading above $45,000 will be a bullish signal for investors to hold onto their bags while anticipating a breakout above $50,000. Moreover, it has been found that only 11% of the entire Bitcoin supply is available for trading. In other words, demand is currently high amid constricted supply. Thus, the pioneer cryptocurrency could continue to rally in the near term.

Note that, a correction will come into the picture if Bitcoin closes the day under $45,000. The trend reversal could go as far as $38,000 in search of formidable support. However, subtle buyer congestions at $43,000 and $40,000 will absorb the selling pressure, preventing a sharp price drop.

Bitcoin intraday levels

Spot rate: $46,175

Relative change: -290

Percentage change: -0.6%

Trend: Bearish

Volatility: High

Read more: CoinGape

The amount of Bitcoin physically available to buy is continuing to fall as nobody really wants to sell at the moment, despite a new all-time high of $47,600.

Recent research by on-chain analytics provider Glassnode has revealed that Bitcoin’s liquid supply is continuing to decrease as investors progressively acquire and hodl the asset for the long term.

The findings indicate that there is currently around 78% of issued Bitcoin are either lost or being hodled. It added that this leaves less than 4 million BTC to be shared amongst future market entrants including large institutional investors such as PayPal, Square, S&P500 companies, ETFs, and the like.

Where is the Bitcoin Going?

The recent surge in BTC price may have been driven by retail traders as social sentiment on Twitter has hit record highs following the Tesla announcement that the firm bought $1.5 billion worth in January.

Grayscale also continues to add to its Bitcoin Trust and its most recent tweet suggests that assets under management for the institutional investment firm are at a record high of over $33 billion.

The Bitcoin Trust still contains the lion’s share of all Grayscale investments with 82% of the total AUM.

Crypto asset manager CoinShares confirmed that BTC investment product trading volumes remain high, averaging $670 million per day last week, representing 5.4% of total Bitcoin trading volumes.

Analyst Willy Woo stated that the big players have been adding to their stashes

“Whales have been adding to their balances throughout this dip, and new whales continue to be birthed. This shows that new coins have been bought by strong hands.”

On Feb. 5, CryptoPotato reported that the number of Bitcoin whales holding more than a thousand coins has increased by more than 200 since the start of 2021.

Bitcoin Price All-Time High

At the time of press, Bitcoin was trading at $47,600, a new all-time high eclipsing the one hit a few hours ago during early trading in Asia on Tuesday morning.

Read more: CryptoPotato

Bitcoin gets the rocket fuel as BTC smashes past $42,600 levels upon Tesla announcing its $1.5 Billion Bitcoin purchase. After fueling the DOGE rally over the weekend, its Elon Musk once again that has taken the Bitcoin community by storm.

The world’s richest man has endorsed Bitcoin quite a few times over the last few weeks. A week back, Elon Musk also changed his Twitter handle to #bitcoin raising speculation of his entry into Bitcoin.

In its recent SEC filing, Tesla has disclosed its latest Bitcoin purchase. The filing states:

“In January 2021, we updated our investment policy to provide us with more flexibility to further diversify and maximize returns on our cash that is not required to maintain adequate operating liquidity. As part of the policy, which was duly approved by the Audit Committee of our Board of Directors, we may invest a portion of such cash in certain alternative reserve assets including digital assets, gold bullion, gold exchange-traded funds and other assets as specified in the future. Thereafter, we invested an aggregate $1.50 billion in bitcoin under this policy and may acquire and hold digital assets from time to time or long-term”.

The Bitcoin Price is 9.84% high as of writing this story trading at $42,938 levels with a market cap of $791 billion. Tesla’s entry into Bitcoin space has helped to break the resistance ceiling of the previous ATH and once again enter into the price discovery mode.

Tesla to Accept Bitcoin Payments on Car Purchases
The great news is that in addition to adding Bitcoin to its reserves, Tesla is also planning to accept payments in BTC against its car sales. The filing states:

Read more: CoinGape