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18Jun2019

Bitcoin Trades Above $9,000, Proving Digital Currencies Are Here To Stay

By Selina Stoller, Summit Consumer Receivables Acquisitions, LLC ***

After seeing most of their value collapse last year, cryptocurrencies are bouncing back with Bitcoin trading above the $9,000 level. This might be a reason to celebrate — but not for obvious reasons.

When compared to last year, Bitcoin’s value is up by 140%. Other cryptocurrencies such as Litecoin ($134.96) and Ethereum ($267.04) dropped 0.65% and 1.58% respectively, with XRP rising 2.38% to $0.42847.

Investing.com estimates that Bitcoin got a boost following reports that Facebook would announce its cryptocurrency this week. But according to the Wall Street Journal, in addition to Facebook’s announcement, Bitcoin’s price rose as a result of established financial institutions warming up to digital currencies and U.S.-China trade relations remaining sour.

Facebook reported that it’s partnering with PayPal, Visa, Uber, and Mastercard to launch Libra, its very own cryptocurrency, next year. With such a powerful tech company reaffirming digital currency’s position, the market seems to be finally warming up to digital currencies as a whole.

But more than giving investors reason to be hopeful, WSJ explains, Bitcoin’s rise is coming at a time when traditional investments such as gold, oil, and bonds are all taking a beating.

While well below its all-time high of near $20,000, Bitcoin’s incredible rise towers over other investments.

WSJ reports that S&P 500, for instance, is up only 15%, crude-oil futures gained 16%, and gold is up just by 4.8%.

Serving as a hedge against instability worldwide, Bitcoin stands as an outlier in the investment world. And according to founding partner at asset-management firm Morgan Creek Digital Anthony Pompliano, institutional investors should strongly consider Bitcoin — and soon. If only for its near-perfect negative correlation between the digital currency and S&P 500 in May, right when China announced it was raising tariffs on $60 billion of U.S. goods, Bitcoin could help shield many investors from ruin.

With China and the U.S. showing no signs they will stop battling over tariffs soon, many believe Bitcoin could serve as much needed protection from a very unstable financial environment.

  • 18 Jun, 2019
  • Summit Consumer Receivables Acquisitions, LLC

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