Market Update for January 10th

Friday, January 10th 2020

Recent Headlines

Bitcoin Set for Growth in 2020 Due to Fixed Supply and Increasing Adoption, says Bloomberg Analyst

The price of bitcoin is likely to increase this year, predicts Bloomberg analyst Mike McGlone, a senior commodity strategist for Bloomberg Intelligence. McGlone believes bitcoin's fixed supply of 21 million coins and increasing commercial adoption are likely to support the world's largest cryptocurrency's appreciation in 2020. Bitcoin is winning the adoption race, notably as a store-of-value in an environment that favors independent quasi-currencies. In 2020, Bitcoin supply should increase about 2.5%, an all-time low on the way to zero growth. Increasing gold prices are also likely to favor bitcoin’s price this year, believes McGlone. Read more...

Bitcoin Hits New 2020 High Above $8,400 After Iranian Missile Attack

On the evening of Jan. 7, the world’s largest cryptocurrency by market cap began a strong upward trend from $8,080 (USD) to above $8,400 before topping out at $8,438 in just over 40 minutes. Spot prices for bitcoin have since retraced to around $8,000 (at the time of writing) as the easing of political tensions by President Trump has calmed global markets. The 2020 highs came after Iranian missiles struck U.S. and coalition bases in Iraq, causing traders to reallocate capital into safe-haven assets such as gold and oil away from riskier assets.

Bitcoin’s recent price jump after the U.S. killing of a top Iranian general has rekindled a long-running debate among investors: whether it will work as a safe-haven asset like gold in times of heightened geopolitical and economic turmoil. Bitcoin has moved in tandem with gold since Friday, Jan 3rd. Read more...

ECB’s Lagarde: We Want to Develop Digital Currencies but Won’t Discourage Private Initiatives

In an interview on Wednesday with French business magazine, Challenges, European Central Bank (ECB) governor, Christine Lagarde, reiterated the ECB wants to play an active role in cryptocurrencies. As businesses and individuals make more cross-border payments around the clock, Lagarde said the bank would continue looking into "the feasibility and merits" of a Central Bank Digital Currency (CBDC). CBDCs may have significant implications for the European bloc's financial sector and changes in monetary policy going forward, Lagarde said. The ECB formed a cryptocurrency task force last month that would work closely with eurozone central banks to understand the benefits and costs of a possible eurozone CBDC. Read more...

Sony Car Points to a Future of Machine to Machine Crypto Payments

There is a school of thought that believes the future of cryptos and blockchain happens when robots begin paying robots. Enter Sony into the electric automotive market. The Japanese electronics and software giant now wants a seat at the mobility table. We know very little about Sony's future car plans and the concept model is far from ready for the market. But eventually, this car and many like it will be facilitating digital payments seamlessly and communicating with each other wirelessly and negotiating traffic automatically. Read more...

What is Bitcoin Halving?

Around every four years, bitcoin undergoes an important event known as “halving” to ensure the continued sustainability of the currency. This first happened in 2012, and again in 2016 (next up, May 2020). To better understand halving, it’s important to revisit the bitcoin mining process.

Bitcoin mining is the process by which the cryptocurrency is secured and transactions processed via the blockchain. In order to encourage network participants to mine, each block contains a reward in the form of some amount of bitcoin. Each four years (or specifically, every 210,000 blocks), the coin reward decreases, and in May of this year the reward will decrease from 12.5 to 6.25 bitcoins. Read more...

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