Price Point: Bitcoin surges past $11K to three-week high, on renewed stimulus hopes and follow-through from Thursday's Square-fueled rally.
Market Moves: Square's $50M bitcoin purchase has analysts doing back-of-the-envelope math on the possibility of rising allocations from corporate treasurers.
Bitcoin Watch: Price surge appears to mark long-awaited breakout from contracting triangle pattern in technical charts, CoinDesk's Omkar Godbole writes.
What's Hot: Tether launches on Solana blockchain, Ripple branches into trade finance, BitMEX CTO released on bond, Pelosi refuses to budge on standalone rescue package for U.S. airlines.
PRICE POINT
Bitcoin was higher for a third straight day, shooting above the psychological threshold of $11,000 and breaking out of the remarkably tight range where the largest cryptocurrency had been stuck over the past two weeks, between $10,500 and $10,800.
The market took off on Thursday as the payments company Square announced plans to put $50 million of corporate funds into bitcoin. (Read down for First Mover's take on the announcement.)
In traditional markets, European stocks rose and U.S. futures pointed to a higher open as U.S. President Donald Trump signaled he might reverse his earlier opposition to a broad stimulus package. Gold rose 1.2% to $1,915 an ounce.
MARKET MOVES
Payments company Square's announcement that it would put some $50 million, or 1% of its assets, into bitcoin has touched off speculation that more corporations might do the same.
Jack Dorsey, the Twitter CEO who also helms Square, is a longtime bitcoin bull so it wasn't a huge surprise that his company would put some of its corporate liquidity into the cryptocurrency. He's following the path of MicroStrategy CEO Michael Saylor, who has invested at least $425 million of the company's assets in bitcoin.
None other than Changpeng "CZ" Zhao, CEO of Binance, the world's largest cryptocurrency exchange, tweeted a question: "Who's going to be the 3rd public company to hold #bitcoin in treasury?" Guesses included Twitter, Tesla, Apple, Warren Buffett's Berkshire Hathaway, even the burger chain Wendy's.
"It's a bit surreal to see gigantic corporate entities now going knee-deep in bitcoin," Mati Greenspan, founder of the foreign-exchange and cryptocurrency analysis firm Quantum Economics, wrote to subscribers on Thursday.
One clever, enterprising soul even ginned up a spreadsheet to keep track of the corporate purchases and published it as a new website, bitcointreasuries.org:
Screen grab from the website bitcointreasuries.org. (Bitcointreasuries.org)
Companies in the Standard & Poor's 500 Index of large U.S. stocks have a combined $2.3 trillion in cash and short-term investments. So a 1% across-the-board allocation to bitcoin would amount to $23 billion of purchases. That's just over 10% of bitcoin's total market capitalization, currently about $200 billion.
A big bullish investment thesis for bitcoin is that large institutional investors are on the verge of diving into cryptocurrencies as an asset class, led by money managers like Fidelity Investments that have embraced the new technology and digital-asset markets.
Now it seems like corporate purchases might add to that buying pressure.
Tweet by Jack Dorsey. (Twitter)
Dorsey tweeted out a "whitepaper" to his 4.7 million followers explaining just how Square had come to buy its bitcoin — noting that the transparency was intended "so others can do the same."
"To maintain transaction privacy and price slippage on execution, treasury purchased the bitcoin over-the-counter with a bitcoin liquidity provider that we currently use as part of Cash App’s bitcoin trading product," according to the whitepaper. "We negotiated a spread on top of a public bitcoin index and executed trades using a time-weighted average price (TWAP) over a predetermined 24-hour period with low expected price volatility and high market liquidity, in order to reduce risks associated with cost and pricing."
Got that, corporate treasurers?
SPONSORED BY ETOROX
Conceived and produced for the corporate and institutional-grade crypto trading community, eToro’s professional crypto exchange eToroX is an effective, trusted, and secure crypto trading solution for professional crypto traders. eToroX offers a comprehensive product suite, designed to suit professional first movers in the crypto space, including:
A unique inverted “Taker-Maker” fee model
New Order Types, including OK, IOC, GTC, and GTD, and special Iceberg orders
Bitcoin, gold, S&P 500, and dollar index daily charts. (TradingView)
Bitcoin has jumped over 3% in the past 24 hours to set a three-week high above $11,000.
The move has confirmed a contracting triangle breakout on the daily chart.
Even so, some analysts remain cautious and want to see the cryptocurrency take out resistance at $11,200 before calling a bullish revival.
"We consider the breakout of the Sept. 19 high of $11,200 to be a more significant catalyst for further upside," Lennard Neo, head of research at Stack Funds, told CoinDesk. He added that the price range of $10,000 to $11,200 may hold until more clarity surfaces going into November U.S. elections.
The rise comes a day after payments company Square announced that it had put 1% of its total assets into the largest cryptocurrency by market cap.
Prices hit $11,023 at 11:05 UTC – the highest since Sept. 20, according to CoinDesk's Bitcoin Price Index.
The rally to $11,000 marked an upside break from the past two week's range of about $10,500 and $10,800.
- Omkar Godbole
The move to ETH 2.0 will bring the Ethereum network ever closer to fulfilling its original vision: that of a "world computer" that plays host to a parallel, decentralized financial system. Will it be the rocket fuel that takes Ethereum's financial engine mainstream?
CoinDesk's invest: ethereum economy virtual event Oct. 14 will address the ramifications for investors of the sweeping changes underway within the Ethereum ecosystem.
Keynote speakers and panelists including Ethereum founder Vitalik Buterin and Commodity Futures Trading Commission Chairman and CEO Heath P. Tarbert will offer deep dives into Ethereum’s adoption of a proof-of-stake consensus mechanism, sharding and other elements of its impending 2.0 upgrade, as well how the new framework impacts the rapidly advancing business of DeFi, stablecoins and decentralized exchanges.
Tether (USDT), Solana (SOL): Tether launches on Solana, the "web-scale" blockchain, designed to compete with Ethereum and hopes to increase its transaction speeds while lowering costs.
The latest quarterly review from CoinDesk Research is out! In this 24-chart report, we look at major developments in crypto markets over the third quarter, focusing on growth in stablecoin liquidity, surging interest in decentralized finance applications, and the notable uptick in crypto derivatives volumes.
At invest: ethereum economy on Oct. 14, we will address the ramifications for investors as decentralized finance takes the crypto world by storm.
In a run-up to the event, our two-part CoinDesk Live: Inside the Ethereum Economy virtual miniseries introduces trending narratives we will break down at the main event: Why all the hype behind yield farming and food-inspired tokens? Should investors take them seriously or are they a fading trend?
Whether it’s wBTC, renBTC or tBTC, tokenized bitcoin is the hottest thing on Ethereum right now. A phenomenon that hardly existed at the beginning of this year has pushed the total value locked in bitcoin past $1.3 billion.
On Oct. 12, CoinDesk markets reporter Zack Voell discusses the yield farming phenomenon with Matt Luongo of Thesis, Jeff Garzik of Bloq, Loong Wang of Ren Project and Kiarash Mosayeri of BitGo.
Disclaimer: The information presented in this message is intended as a news item that provides a brief summary of various events and developments that affect, or that might in the future affect, the value of one or more of the cryptocurrencies described above. The information contained in this message, and any information liked through the items contained herein, is not intended to provide sufficient information to form the basis for an investment decision. The information presented herein is accurate only as of its date, and it was not prepared by a research analyst or other investment professional. You should seek additional information regarding the merits and risks of investing in any cryptocurrency before deciding to purchase or sell any such instruments.
ATTENTION: Scammers have been sending fraudulent emails with links to sites disguised to look like coindesk.com. If you are in doubt about a link, type https://www.coindesk.com directly into your browser; do not copy and paste. Remember, if something seems too good to be true, it probably is.
First Mover: Bitcoin Hits $11K as Square Exposes $2.3T Corporate Money Pot