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  • Bitcoin Surges To New Peak Amid U.S. Regulatory Hopes

    Bitcoin Surges To New Peak Amid U.S. Regulatory Hopes

    Bitcoin hit a new all-time high on Wednesday, fueled by rising investor confidence and optimism over U.S. cryptocurrency legislation. Analysts cited growing bipartisan support in Congress for clearer regulations, especially around digital assets and stablecoins, as a key driver.
    Credit: Pixabay

    Bitcoin hit a new all-time high on Wednesday, fueled by rising investor confidence and optimism over U.S. cryptocurrency legislation. Analysts cited growing bipartisan support in Congress for clearer regulations, especially around digital assets and stablecoins, as a key driver.

    The push for regulatory clarity reassures investors and signals a step toward wider adoption and institutional interest. Bitcoin also gained from improving macroeconomic conditions and easing global trade tensions, which boosted appetite for riskier assets. Together, these factors created a strong backdrop for Bitcoin’s rally and signaled growing acceptance of cryptocurrencies in the financial system.

    Regulatory Momentum and Political Shifts Drive Bitcoin to New Heights

    Bitcoin, the world’s leading cryptocurrency, soared to a record high of $109,499.76, surpassing its previous peak set on January 20, the day Donald Trump inaugurated as U.S. president.

    Analysts credit the surge to Congress renewing bipartisan backing for a bill that regulates stablecoins—digital currencies pegged to the U.S. dollar—and raising hopes for broader regulatory clarity, including for Bitcoin, which isn’t dollar-linked.

    The rally gained further support from improved macroeconomic conditions and a renewed appetite for riskier assets as tensions eased between the U.S. and major trading partners.

    Trump, during his re-election campaign, pledged support for cryptocurrencies. However, the introduction of widespread U.S. tariffs had earlier rattled markets and heightened uncertainty.

    Bitcoin surged past the symbolic $100,000 mark on May 8 for the first time since February, following the announcement of a trade agreement between the United States and Britain.

    Cryptocurrencies have remained in the spotlight since their inception, known for dramatic price swings and the downfall of major industry players, most notably the FTX exchange.

    Bitcoin miners generate—or “mine”—Bitcoin as a reward for using powerful computers to solve complex equations that verify transactions on the tamper-resistant blockchain ledger.

    Read the original article on: Tech Xplore

    Read more: Crypto Elite Increasingly Fear for their Safety

  • Bitcoin price plummets amid market uncertainty.

    Bitcoin price plummets amid market uncertainty.

    Credit: Pixabay

    Bitcoin’s price plunged nearly 10 percent on Monday as escalating trade tensions and uncertainty over a proposed U.S. crypto reserve fund drove investors away from risk.

    Initially, Bitcoin and other digital assets surged after President Donald Trump floated the idea of creating a national cryptocurrency reserve. However, prices quickly tumbled as doubts emerged over whether the plan would materialize.

    “Investors are selling everything,” said Forexlive manager Adam Button. “There’s a de-risking unfolding among crypto investors.”

    By late Monday, Bitcoin had fallen 9.47 percent to $85,321.69, with the total market value of Bitcoin still exceeding a trillion dollars. Ether, the second-largest digital asset, dropped more than 15 percent, while major cryptocurrencies like XRP, Cardano, and Solana declined nearly 20 percent.

    Adding to the pressure, Trump confirmed 25 percent tariffs on all imports from Mexico and Canada, prompting both countries to vow retaliation. Button noted that these trade war concerns, coupled with fears of slowing U.S. economic growth in the first quarter, have further rattled the market.

    Trump’s Crypto Reserve Proposal Temporarily Boosts Market

    Earlier in the day, cryptocurrency prices climbed after Trump named five digital assets—Bitcoin, Ether, XRP, Cardano, and Solana—as potential additions to a national strategic reserve fund. The government would build this reserve using digital currencies already in its possession, mainly from court seizures or sanctioned individuals and companies.

    However, industry leaders expressed skepticism over the selection of currencies. Coinbase CEO Brian Armstrong suggested that restricting the reserve to Bitcoin “would probably be the best option.” He argued that Bitcoin’s simplicity and potential role as a successor to gold made it the strongest choice.

    After Trump promoted the idea of a cryptocurrency reserve, investors rushed to buy, only to later question whether it would actually happen, Button explained. Since such a reserve requires congressional approval, he remained doubtful about its prospects.2

    “It’s one thing to tweet about it,” Button said, “but you need to pass legislation to make this happen. And that’s still a long shot.”

    Read Original Article: TechXplore

    Read More: Trump Proposes Establishing a Crypto Strategic Reserve

  • Predictors of Bitcoin Returns: Blockchain Technology, Investor Sentiment, and Economic Stress

    Predictors of Bitcoin Returns: Blockchain Technology, Investor Sentiment, and Economic Stress

    Credit: Unsplash.

    A groundbreaking paper from the Illinois Institute of Technology researchers highlights that blockchain technology, investor sentiment, and economic stress levels are significant predictors of Bitcoin returns. The empirical evidence presented in the paper aims to provide valuable insights for investors, economists, and academics.

    Co-authored by Sang Baum “Solomon” Kang, associate professor of finance at Illinois Tech’s Stuart School of Business, the study reveals that Bitcoin is detached from economic fundamentals, suggesting that it may not effectively serve as a diversifier or safe-haven asset. 

    Additionally, the research indicates that returns on commodities, securities, and other assets do not reliably predict Bitcoin returns.

    The paper “What Information Variables Predict Bitcoin Returns?“

    The paper “What Information Variables Predict Bitcoin Returns? A Dimension-Reduction Approach” was published in The Journal of Alternative Investments. Kang collaborated with two former doctoral students: Yao Xie, an associate quantitative analyst at Morningstar Inc., and Jialin Zhao, an associate professor of quantitative management at St. Mary’s University in San Antonio.

    Using predictive analytics techniques and dimension-reduction models, the team analyzed data from January 2011 to January 2020, examining 25 information variables across macroeconomics, blockchain technology, other assets, stress levels, and investor sentiment.

    Kang explains, “We find blockchain technology, investor sentiment, and stress levels have predictive power for Bitcoin returns. Similar to traditional assets, Bitcoin exhibits higher return predictability with longer horizons. These findings support the dual nature of Bitcoin as both a technical artifact and speculative asset.”

    The Key findings

    Key findings from the study include:

    1. Increased mining difficulty positively predicts Bitcoin returns, indicating that as blockchain technology requirements rise, the reduced supply of Bitcoin leads to higher returns.
    2. Bitcoin returns are driven by positive investor sentiment, underscoring the speculative nature of the cryptocurrency as an asset.
    3. Higher stress levels or financial turmoil in the economy are associated with a decrease in future Bitcoin returns, emphasizing the risks associated with holding Bitcoin as an asset.

    The researchers suggest that Bitcoin has played three distinct economic roles over time: a currency, a speculative security, and a safe-haven commodity due to its scarcity and mining costs.

    Kang explains the significance of the research, stating, “In academia, there is a research methodology called the asset return predictability study. The underlying principle is that variables predicting the future movement of an asset price may be important in the economic system. So understanding those variables is important not only for traders seeking to take a position in Bitcoin but also for economists aiming to comprehend the nature of Bitcoin.”

    Read the original article on PHYS.

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  • Wharton Professor Explains What All the Buzz Around Bitcoin is About

    Wharton Professor Explains What All the Buzz Around Bitcoin is About

    Credit: Alesia Kozik/pexels.com

    The Wharton School’s Mauro Guillén, a professor of international management, responds to inquiries about the increased interest.

    Elon Musk energized the possibilities for Bitcoin stock earlier this month when he promised that Tesla, Inc. will soon accept payment for its electric vehicles in the much-discussed but little-known currency.

    Mauro Guillén, previously the head of the Lauder Institute and the Zandman Endowed Professorship in International Management at the Wharton School, discussed Bitcoin with Penn Today.

    What is Bitcoin?

    One of the first and undoubtedly the most well-known cryptocurrencies is Bitcoin. It differs from government-issued fiat money in that there is no centralized authority supporting it. The number of bitcoins in exchange, which can only slowly rise over time, the verification of transactions, and the manner in which ownership is recognized are instead controlled by a set of mathematical rules.

    What distinguishes it from money produced by central banks?

    Money has three functions: first, as a means of exchange for sending and receiving payments; second, as a standard of measurement used to determine the value of various items; and third, as a store of value used to hold savings or surpluses. Due to the fact that only a small number of people, businesses, or governments currently accept Bitcoin as payment, it is currently an extremely limited mode of exchange. Although it has no function as a unit of account, it can be thought of as a store of value because it is an asset that can be bought and whose value may be preserved or even grow over time.

    What is the cause of the price rise?

    Bitcoin’s price is solely governed by supply and demand because, unlike gold, it does not produce a dividend and has no intrinsic worth. Design constraints on the supply mean that the price is a function of demand. Price increases are inversely correlated with demand, as has been the case over the past few months.

    Is it volatile at all?

    Bitcoin is really erratic. The demand determines the price primarily. If present Bitcoin owners foresee or perceive problems, their sales could bring the price down. If it is restrictive, governmental or central bank regulation may also lower its value. For instance, the Fed has vocally opposed unregulated cryptocurrencies on numerous occasions over the past few years, leading to a sharp decline in value. Bitcoin’s price is one of the most erratic.

    How do you exchange it, spend it, and store it?

    To purchase bitcoins, one must open an account on a fintech platform, or increasingly, a financial institution or bank, and use another currency, such as dollars. The so-called blockchain, a computerized database or ledger that keeps track of all operations, is the foundation of the Bitcoin market. This registry is decentralized in the sense that it is present on each computer connected to the network. Given the lack of a centralized authority,’miners,’ who receive a commission for confirming that a transaction has occurred, verify Bitcoin transactions.

    On the same platforms, one can sell bitcoins. Only a small portion of all businesses around the world accept it as a form of payment.

    One key issue with Bitcoin’s design is that, due to the size of the global economy, it is hard for it to become a major participant in payments if the quantity of cryptocurrency in circulation grows extremely slowly. Thus, the alleged objective of developing into a currency that competes with the dollar or the euro is hampered by the goal of achieving stability through a supply restriction. This cryptocurrency cannot potentially function as a medium of exchange for billions of people until additional bitcoins are produced.

    What awaits us in the future?

    Cryptocurrencies like Bitcoin won’t ever be accepted as a stand-alone form of payment by governments or central banks, in my opinion. They don’t want to cede control of the monetary system or the amount of money in circulation. Governments will inevitably create their own virtual money, as China is set to do.

    However, if cryptocurrencies evolve beyond being merely money, they may have a future. They can be a component of a package of services, such as digital tokens that let users sign up for smart contracts, get discount coupons, vote in elections, or as shareholders, etc.

    Read the original article on Scitechdaily.

    Read more: Will Central Bank Digital Currencies Doom Dollar Supremacy?

  • What’s the Buzz About Bitcoin Cryptocurrency and Blockchain Technology?

    What’s the Buzz About Bitcoin Cryptocurrency and Blockchain Technology?

    We understand Elon Musk is a fan; however, what is all the fuss around, and when will the Bitcoin bubble burst?

    Comparable to the stock market, the cryptocurrency market is regularly subjected to extreme cost variations– both upwards and downwards. Tesla recently buying $1.5 billion worth of Bitcoin is simply one example of how the crypto market can transform.

    For example, from the end of 2013 to the start of 2014, throughout the middle of 2017 to the middle of 2018, and currently, once more, as we’ve seen in the past months, there have been many high and low cryptocurrencies.

    If we analyze the fluctuation of cryptocurrencies throughout a 52-week period, it is clear that the most significant market capitalization is what we have seen in the past couple of weeks:

    • Bitcoin (No. 1 cryptocurrency by market capitalization) had a 52-week low of US$ 4106 and a 52-week high of US$ 58,330 (a factor of 14.2 apart).
    • Ethereum (second by market capitalization) had a 52-week low of US$ 95 and a 52-week high of US$ 2036 (factor of 21.4 apart).
    • Cardano (No. 3 by market capitalization) had a 52-week high of US$ 1.48 and a 52-week low of US$ 0.01913 (factor of 77.4 apart).

    (source: https://coinmarketcap.com, consulted on March 2, 2021.)

    This level of variation within one year is rarely seen in the stock market, and it’s usually not something that’s taking place once-off to one specific cryptocurrency; it’s occurring commonly and to several cryptocurrencies.

    Comprehending the blockchain ecosystem

    Blockchain technology has quickly progressed over the past couple of years as even more researchers, businesses, and developers start to take on and recognize it.

    In the first generation of blockchain systems, there were many limitations to scalability, the high consumption of power, limited assistance for smart contracts, and more.

    Currently, thousands of projects and platforms are trying to boost various elements of blockchain technology, involving hundreds of highly qualified researchers and countless skillful engineers.

    Leading worldwide establishments think blockchain solutions can have a significant financial impact.

    Nevertheless, the realization of this potential will depend on technical developments, the acceptance of blockchain solutions by the industry and the basic populace, the regulation passed to regulate the blockchain space, and the growth of new business models based on the technology.

    Linking back to the crypto market

    There is a possibility that the recent cryptocurrency price hikes are partially or entirely justified by changes in market participants’ of the factors influencing the future potential customers of blockchain platforms. Nonetheless, in the long run, the worth of cryptocurrencies will undoubtedly depend on the financial added value produced by the blockchain ecosystem.

    If we look back to the 1990s and the dot-com boom, there was a massive development in internet use, and it was recognized that it would alter the globe. Hundreds of net-related companies appeared and began establishing technologies, solutions, and applications.

    A market bubble eventuated because of excessive conjecture, and in the crash, many firms were required to close down.

    However, the web, of course, ended up being cutting edge, and some of the companies created back then are today among the globe’s most significant.

    If blockchain technology’s potential is realized, perhaps the majority of existing platforms and jobs will not make it, substantially lowering in worth or disappearing altogether.

    However, there is a reasonable possibility that a few of them will undoubtedly be big winners.

    Read the original article on Scitechdaily.