Bitcoin’s value just broke $1,000. Again. And then went below. Again. Then up and down again. (Anyone else feeling seasick?)
Following relatively flat growth through the end of January (by cryptocurrency standards, anyway), bitcoin’s value spiked, breaking $1,000 to reach a high of $1,003.92 in Thursday afternoon trading. At the time of this writing, bitcoin sat tenuously at $1,000.73, up 1.36 percent for the day.
Don’t look away — things could always change in the blink of an eye. The last time this happened, the bubble burst about $100 higher, though the People’s Bank of China’s (PBoC) meetings with bitcoin exchanges were likely to blame for investor panic — thus the value drop.
The PBoC spot checks didn’t lead to indictments, arrests or major regulation changes, but Chinese exchanges have since restricted margin trading and introduced trading fees. BTCC, Huobi and OkCoin now charge traders a flat fee of 0.2 percent per transaction.
Unsurprisingly, there has been a shift in the overall ecosystem toward markets that don’t charge trading fees, writes CoinDesk. This shift could be responsible, at least in part, for the recent price rise. Investors are likely waiting with bated breath to see if this holds — or, in this case, waiting with their index fingers postured to take action at any moment. We’ll just have to wait and see.
Stateside, investors continue work toward bitcoin’s financial legitimacy, attempting to shed its seedy reputation and tone down its volatility. On Jan. 20, Grayscale Investments, LLC, filed with the Securities and Exchange Commission (SEC), requesting to have its Bitcoin Investment Trust listed on the New York Stock Exchange.
If the SEC were to approve the fund (analysts say it’s unlikely in 2017), it could increase awareness and grow interest in bitcoin among traders. Given SEC approval, the bitcoin trust would operate as a traditional exchange-traded fund (ETF), with an asset class appeal similar to that of gold. A bitcoin-based ETF could work to downplay some of bitcoin’s more unpredictable tendencies, though it would remain on the riskier side as far as investments go.
While investors wait for the SEC decision, they can pass the time by setting up their own bitcoin kiosks. Peer-to-peer bitcoin technology company Paxful recently launched a new web widget, the Virtual Bitcoin Kiosk, that allows anyone to buy bitcoin worldwide instantly, with over 300 ways to pay up.
Users can reportedly embed the Paxful widget onto blogs, websites or even their Facebook page, allowing them to run a customizable bitcoin kiosk. Users can earn 2 percent commission from every sale made through their personal widget.
Paxful cofounder Ray Youssef was quoted by FinExtra as saying, “Bitcoin is still an early-stage technology. Think about how the web was before Google AdSense. This program is incredible for anyone seeking ground-floor opportunities.”
Meanwhile, in Switzerland (bitcoin’s favorite country), the Swiss Financial Market Supervisory Authority (FINMA) approved U.S. bitcoin wallet and vault Xapo to operate in the country. Xapo has been designated a financial intermediary and does not require a banking license, said Reuters.
While other cryptocurrency firms operate in Switzerland, Xapo stores private-access keys, reportedly leading to questions about whether or not the wallet technically took deposits. Xapo first looked to expand to non-U.S. markets three years ago, deciding on Switzerland in 2015.
Xapo CEO Wences Casares wrote on the company blog that FINMA’s approval was conditional and required the company to take part in a self-regulatory organization, among other things.
“Many regulatory bodies in similar situations would have rejected Xapo (and bitcoin) entirely,” wrote Casares. “By choosing to persevere, however, we believe FINMA has positioned Switzerland as a hub for FinTech innovation and ensured Switzerland’s primacy in global financial services for decades to come.”