There has been a significant uptick in bitcoin’s popularity, with its price skyrocketing well over 300% over the past year, which has been marked by a severe health crisis and economic downturn.
Treasury Secretary nominee Janet Yellen has suggested that lawmakers should “curtail” the use of cryptocurrencies such as bitcoin, expressing concerns that they are “mainly” used for illicit purposes, Business Insider reported.
The official’s comments point to the fact that the Joe Biden administration will likely not promote cryptocurrencies, but zero in on tough regulation of them instead. Watchdogs from around the world, from the European Central Bank to national regulators, have in recent time raised questions about the trustworthiness of cryptocurrencies like bitcoin.
rlying the use of digital coins, namely being used by terrorists, the projected Treasury head explained:
"You're absolutely right that the technologies to accomplish this change over time, and we need to make sure that our methods for dealing with these matters, with terrorist financing, change along with changing technology”.
She referred to cryptocurrencies as a “particular concern”, saying she believes an array of them are used in the shadow economy, at least “in a transaction sense”, and stressing the need “to make sure that money laundering doesn’t occur through those channels”.
Yellen thereby shared the stance of ECB President Christine Lagarde, who said last week that bitcoin had been used for some "totally reprehensible money laundering activity".
Digital money has long been in regulators’ crosshairs as it remains mostly uncontrolled and hardly traceable, making it particularly appealing to fraudsters.
Bitcoin bulls have meanwhile been rejoicing about the recent record jump - by roughly 340 percent - in the cryptocurrency's price. It notably breached the $40,000 mark to peak at $40,324.01 on 7 January.
The surge in the rates of the flagship digital currency started with the first flare-ups of the novel coronavirus. Retail investors, and increasingly financial institutions, started to demonstrate trust in it as a safeguard against galloping inflation amid the coronavirus-related economic fallout.
We are currently experiencing record high traffic. This is resulting in some customers having slow performance or issues logging into their http://Coinbase.com accounts. We are actively working to resolve this as quickly as possible.
We do note that GDAX pricing appears to be at a significant premium to several other exchanges.
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Update: Bitcoin just surpased $16,000... speechless...
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In the last 36 hours, Bitcoin has blasted through $12,000, $13,000, $14,000, and now $15,000 levels in an unprecedented 28% surge...
With a market cap of around $250 billion, Bitcoin is bigger than Proctor & Gamble and approaching the size of Wal-Mart as the 12 biggest 'company' in the S&P 500.
As CoinTelegraqph reports, the price is likely being driven by news of the imminent launch of Bitcoin futures trading. CBOE will be launching their futures market this coming Sunday, December 10, with CME Group following on December 18. Nasdaq plans to launch futures trading in the summer of 2018 and Japan’s Tokyo Financial Exchange is preparing to launch futures trading as well.
GDAX, Coinbase’s digital currency exchange, has been leading the rally all day. The price on GDAX is currently about $500 ahead of other Western Bitcoin exchanges. The likeliest - and most bullish - explanation is that Coinbase is the easiest way for new Bitcoin investors to get involved. Consequently, when GDAX leads the charge as it has today, it probably means new “retail” investors are fueling the rally.
Meanwhile, as CoinDesk reports, Ron Paul wants to know: would you take $10,000 in bitcoin, cash or something else?
The former U.S. Congressman from Texas is currently holding a poll on his official Twitter account that asks in which form they would take $10,000 from a "wealthy person". The catch: you can't get rid of it for 10 years.
Paul – who earlier this year called for the U.S. government to "stay out" of bitcoin – put the question to his more than 650,000 followers, asking if they would take $10,000 in the form of bitcoin, dollars, gold or 10-year U.S. Treasury Bonds. The result thus far – one hour remains in the poll at press time – indicate that of the more than 70,000 responses, 54 percent expressed support for bitcoin.
Gold took the second-highest amount with 36 percent, followed by a mere 8 percent for the 10-year bonds. Just 2 percent indicated that they would take the Federal Reserve Notes if offered.
A wealthy person wants to gift you $10,000. You get to choose in which form you'll take the gift. But there's a catch: You must keep the gift in the form that you choose, and you can't touch it for 10 years.
Speaking with TheStreet in October, Paul conceded that he's no expert on cryptocurrencies (back in 2014, he argued that bitcoin wasn't "true money"). That said, he voiced his support for cryptocurrency in the most recent interview, arguing that it lends credence to the emergence of alternative currencies against the U.S. dollar.
"Money is a bubble that never pops," he said at yesterday's Token Summit II in San Francisco.
He told attendees:
"It's a consensus hallucination."
And speaking to the newfound attention to bitcoin, Ravikant said people are interested in growing the wealth that they have. With most savings accounts returning zero these days – as central banks conduct what Ravikant called their "grand money printing experiment" – the general public is looking for alternative places to store their money and watch it grow.
Bitcoin and other protocols seem to offer that, as even the less-developed cryptocurrencies are showing substantial returns.
"I think people are looking to solve their money problems," he said.
Additionally, Coindesk notes that the former chairman of the U.S. Federal Reserve, Alan Greenspan, has joined the many financial luminaries to recently criticize bitcoin's value.
Speaking to CNBC, Greenspan compared bitcoin to that of an early American form of money called "Continental currency" that came into use in 1775 and had become worthless by 1782. The paper-based legal tender was used at the time of the American Revolution and was not backed by a commodity such as gold.
Noting that bitcoin will likely suffer similar fate, Greenspan said that a "significant share" of Continental currency was still used to create "real goods and services," even though it had no ultimate worth.
He continued:
"Bitcoin is really a fascinating example of how human beings create value, and is not always rational ... It is not a rational currency in that case."
Greenspan's comments come as the value of a bitcoin is soaring beyond most expectations, having gained thousands of dollars in value in the last two days.
And finally, for those calling this a "bubble" - we would humbly suggest you ain't seen nothing yet...
Steve Keen and Max Keiser debate bitcoin and whether it is a store of value or a bubble
The Bitcoin debate: Max Keiser vs. Steve Keen
Max
Keiser and Alex Jones on bitcoin
Austin/We
Have A Problem. Alex Come Back/The Great Deception is Strong. The
Beast System is like a Casino. It must have many winners at first to
draw in the multitudes. The Black Hole.
Eric
Holthaus discusses the ecological costs of the bitcoin revolution
If
you’re like me, you’ve probably been ignoring the bitcoin
phenomenon for years — because it seemed too complex, far-fetched,
or maybe even too libertarian. But if you have any interest in a
future where the world moves beyond fossil fuels, you and I should
both start paying attention now.
Last
week, the value of a single bitcoin broke the $10,000 barrier for the
first time. Over the weekend, the price nearly hit $12,000. At the
beginning of this year, it was less than $1,000.
If
you had bought $100 in bitcoin back in 2011, your investment would be
worth nearly $4 million today. All over the internet there are
stories of people who treated their friends to lunch a few years ago
and, as a novelty, paid with bitcoin. Those same people are now
realizing that if they’d just paid in cash and held onto their
digital currency, they’d now have enough money to buy a house.
That
sort of precipitous rise is stunning, of course, but bitcoin wasn’t
intended to be an investment instrument. Its creators envisioned it
as a replacement for money itself — a decentralized, secure,
anonymous method for transferring value between people.
But
what they might not have accounted for is how much of an energy suck
the computer network behind bitcoin could one day become. Simply put,
bitcoin is slowing the effort to achieve a rapid transition away from
fossil fuels. What’s more, this is just the beginning. Given its
rapidly growing climate footprint, bitcoin is a malignant
development, and it’s getting worse.
Cryptocurrencies
like bitcoin provide a unique service: Financial transactions that
don’t require governments to issue currency or banks to process
payments. Writing in the Atlantic, Derek Thompson calls bitcoin an
“ingenious and potentially transformative technology” that the
entire economy could be built on — the currency equivalent of the
internet. Some are even speculating that bitcoin could someday make
the U.S. dollar obsolete.
But
the rise of bitcoin is also happening at a specific moment in
history: Humanity is decades behind schedule on counteracting climate
change, and every action in this era should be evaluated on its net
impact on the climate. Increasingly, bitcoin is failing the test.
Digital
financial transactions come with a real-world price: The tremendous
growth of cryptocurrencies has created an exponential demand for
computing power. As bitcoin grows, the math problems computers must
solve to make more bitcoin (a process called “mining”) get more
and more difficult — a wrinkle designed to control the currency’s
supply.
Today,
each bitcoin transaction requires the same amount of energy used to
power nine homes in the U.S. for one day. And miners are constantly
installing more and faster computers. Already, the aggregate
computing power of the bitcoin network is nearly 100,000 times larger
than the world’s 500 fastest supercomputers combined.
The
total energy use of this web of hardware is huge — an estimated 31
terawatt-hours per year. More than 150 individual countries in the
world consume less energy annually. And that power-hungry network is
currently increasing its energy use every day by about 450
gigawatt-hours, roughly the same amount of electricity the entire
country of Haiti uses in a year.
That
sort of electricity use is pulling energy from grids all over the
world, where it could be charging electric vehicles and powering
homes, to bitcoin-mining farms. In Venezuela, where rampant
hyperinflation and subsidized electricity has led to a boom in
bitcoin mining, rogue operations are now occasionally causing
blackouts across the country. The world’s largest bitcoin mines are
in China, where they siphon energy from huge hydroelectric dams, some
of the cheapest sources of carbon-free energy in the world. One
enterprising Tesla owner even attempted to rig up a mining operation
in his car, to make use of free electricity at a public charging
station.
In
just a few months from now, at bitcoin’s current growth rate, the
electricity demanded by the cryptocurrency network will start to
outstrip what’s available, requiring new energy-generating plants.
And with the climate conscious racing to replace fossil fuel-base
plants with renewable energy sources, new stress on the grid means
more facilities using dirty technologies. By July 2019, the bitcoin
network will require more electricity than the entire United States
currently uses. By February 2020, it will use as much electricity as
the entire world does today.
This
is an unsustainable trajectory. It simply can’t continue.
There
are already several efforts underway to reform how the bitcoin
network processes transactions, with the hope that it’ll one day
require less electricity to make new coins. But as with other
technological advances like irrigation in agriculture and outdoor LED
lighting, more efficient systems for mining bitcoin could have the
effect of attracting thousands of new miners.
It’s
certain that the increasing energy burden of bitcoin transactions
will divert progress from electrifying the world and reducing global
carbon emissions. In fact, I’d guess it probably already has. The
only question at this point is: by how much?
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