1. Market Wrap: Bitcoin Steady Near $54K; RSI Indicator Warns of Limited Uptrend
After two days of sell-offs, bitcoin bulls finally returned.
Bitcoin (BTC) trading around $53,824.22 as of 20:00 UTC (4 p.m. ET). Climbing 3.22% over the previous 24 hours.
Bitcoin’s 24-hour range: $51,267.19-$54,032.05
BTC trades above its 10-hour and 50-hour averages on the hourly chart, a bullish signal for market technicians.
What a dud: Friday’s record $6 billion expiry in the bitcoin options market turned to be a nonevent as prices for the largest cryptocurrency climbed steadily, with nary a glimpse of the feared plunge to the “max pain” point of $44,000.
For bitcoin bulls, the absence of action brought a measure of relief, with prices ticking up 4.8% on the day to about $53,800, allowing the 12-year-old digital asset to reclaim its losses from the past couple days.
With March coming to an end, one analyst said bitcoin should get “a nice tailwind” as hedge funds rebalance for quarterly reports or to manage risks.
2. Duke University’s Early Coinbase Investment Could Now Be Worth $500M
Duke’s direct exposure to Coinbase in one of its early investment rounds has probably increased 100x, two people familiar with the matter said.
The endowment fund of Duke University, the alma mater of Coinbase co-founder Fred Ehrsam, was one of the fortunate few to have made an early investment in the soon-to-list cryptocurrency exchange.
Two people familiar with the matter said the $3.9 billion Duke Endowment was included early on in the cap table of Coinbase, which is expected to command a price tag of around $100 billion when its shares debut on Nasdaq. Those shares are now worth a small fortune, on the order of nine figures, the sources said.
“The Duke University endowment has direct Coinbase exposure because Fred [Ehrsam] approached Duke for one of the early rounds,” said a source who was part of the venture capital community at that time. “They probably 100x’d their money, after dilution. So even if they only put in $5 million, they just made $500 million, which is a lot for an endowment.”
Coinbase declined to comment. Duke Endowment did not immediately return requests for comment.
3. Elon Musk’s Bitcoin Marketing Coup
By embracing bitcoiners, Tesla is likely to make more sales among that crowd even if they pay in fiat. Any extra BTC the carmaker gets is gravy.
Here’s some free advice for the Honda Motor Company: Market your cars to the newly bitcoin rich.
I’ve already got the ad copy for you.
A true bitcoiner is building for the future and deferring gratification. She doesn’t blow her hard-earned savings on flashy toys. She prefers a solid, dependable family car.
4. UK Man Ordered to Pay More Than $571M for Fraudulent Bitcoin Trading Scheme: CFTC
The man solicited at least 22,190.542 bitcoin, valued at about $143 million at the time, from more than 1,000 customers worldwide.
The U.S. District Court for the Southern District of New York entered a default judgment against a U.K. man, for operating a fraudulent scheme to solicit bitcoin (BTC, +4.93%) from members of the public and misappropriated that bitcoin, the Commodity Futures Trading Commission (CFTC) said in a release.
According to the court’s March 2 order, Benjamin Reynolds, purportedly of Manchester, England, was ordered to pay nearly $143 million in restitution to defrauded customers and a civil monetary penalty of $429 million, the CFTC said.
Reynolds also is permanently enjoined from engaging in conduct that violates the Commodity Exchange Act and CFTC regulations, registering with the CFTC, and trading in any CFTC-regulated markets.
Between May 2017 and October 2017, Reynolds used a website, social media accounts, and email to solicit at least 22,190.542 bitcoin, valued at about $143 million at the time, from more than 1,000 customers worldwide, including at least 169 individuals living in the U.S., according to the release.
Among other things, Reynolds falsely represented that his company traded customer bitcoin deposits in virtual currency markets and employed specialized virtual currency traders who generated guaranteed trading profits.
The judgment is the result of a 2019 enforcement action brought by the CFTC.
5. Money Reimagined: NFTs Can Learn From DeFi’s Growth
Once the frenzy around NFTs subsides, the category will need new ways to grow. DeFi is one promising avenue, as we all known.
This week, you could be forgiven for thinking bitcoin has ceded ground at the epicenter of the crypto zeitgeist to non-fungible tokens (NFT). Bitcoin’s price dropped to its lowest level since March 8, after failing to consolidate gains made on yet another Elon Musk tweet. Meanwhile, NFT stories were everywhere again. Another Beeple art piece sold for $6 million to raise funds for the Open Earth Foundation’s efforts to fight climate change, and both The New York Times and Time Magazine announced sales of their own NFTs.
At the same time, it’s rather indisputable that NFTs are in a bubble. The question, asked by this week’s column, is where their real value might be found once that bursts.
It’s also true that bitcoin continues to attract attention in financial troubled parts of the world. There was a spike of interest in Turkey this week as its financial crisis worsened after President Recep Erdoğan got rid of his third central bank governor in less than two years. And there continues to be strong demand for bitcoin in Argentina, the country whose century-long troubles with money are the subject of this week’s edition of our “Money Reimagined” podcast.
We were joined by Lucas Llach, a former vice president of the Central Bank of Argentina, and by Santiago Siri, an Argentine-born crypto developer whose experiences there led him to invent an entirely new, decentralized approach to democracy. Have a listen after you read the newsletter.
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March 27, 2021
