After a tough January, bitcoin (BTC) started trading in February in the $38,000-$39,000 range. The coin is now trading around 17% below its January open of $46,312, but around 16% above the January 24 six-month low of $33,184.
Bitcoin is now 44% below its January all-time high, but institutional investors aren’t giving up on the world’s oldest cryptocurrency just yet.
For example, Boston’s asset management arm, US financial giant Fidelity Investments, is the fourth largest asset manager in the world, with assets under management (AUM) estimated at $3.319 billion (2.45 billion pounds sterling, 2.937 billion euros) and more than 27 million customers worldwide. Its Fidelity Digital Assets segment provides professional-grade custody and execution services to institutional investors.
As such, its researchers have made quite a pro-bitcoin statement. In a report titled Bitcoin First, Fidelity Digital Assets research director Chris Kuiper and research analyst Jack Neureuter argue that bitcoin should always be considered “an entry point for investors” and that it constitutes “a superior form of money”.
“Bitcoin should be viewed as an entry point for traditional allocators looking to gain exposure to digital assets.”
They also stated that “bitcoin is best understood as a monetary good, and one of the primary investment theories for bitcoin is as the store of valuable assets in an increasingly digital world.”
According to CoinMarketCap.com, there are currently over 17,000 cryptocurrencies/tokens/coins, all of which are types of digital assets.
Yet of these, the authors of the Fidelity Digital Assets report, Kuiper and Neureter, asserted that: “No other digital asset is likely to improve bitcoin as a monetary good, because bitcoin is the most ( compared to other digital assets) secure, decentralized and solid digital money, and any “improvement” will necessarily face trade-offs.”
“Bitcoin clearly has a lot of the good qualities of money, combining the rarity and durability of gold with the ease of use, storage, and transportation of fiat (even bettering it).”
Other crypto news:
- The Coachella Music and Arts Festival will auction 10 Non-Fungible Token (NFT) Lifetime Passes in the form of a digital “Coachella Key”.
The sale will begin on Friday January 4 on the American exchange FXT, with which Coachella says it has partnered to “build an environmentally friendly market” via Solana. A portion of the proceeds from each item will be donated to Give Directly, Lideres Campesinas and Find Food Bank, with royalties to support artists and other planned NFTs.
Since Coachella general admission tickets start at $449 (now $549, with other passes sold out), lifetime tickets are expected to command premium prices.
Quote of the day:
Michael Saylor is the co-founder, chairman and CEO of MicroStrategy, the largest bitcoin-owning company. As a renowned crypto proponent, when asked if his company was selling BTC during a recent market drop, Saylor told Bloomberg, “Never. No. We are not sellers. We only acquire and hold bitcoins, right? This is our strategy.
MicroStrategy purchased an additional 660 bitcoins for approximately $25.0 million in cash at an average price of approximately $37,865 per #bitcoin. As of 01/31/22, we #hodl ~125,051 bitcoins acquired for ~$3.78 billion at an average price of ~$30,200 per bitcoin. $MSTRhttps://t.co/bF6VImC0Qy
— Michael Saylor⚡️ (@saylor) February 1, 2022
Top Coins by Market Cap
From 9:00 GMT:
Winners and losers
- Bitfinex’s LEO token jumped 10.05% in the past 24 hours to an all-time high of $4.54.
- Cosmos (ATOM) was the biggest weekly loser among the top 50 virtual tokens, losing 19.37% over the period.
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The difference between trading assets and CFDs
The main difference between trading CFDs and trading assets, such as commodities and stocks, is that you do not own the underlying asset when trading a CFD.
You can always profit if the market moves in your favor or suffer a loss if it moves against you. However, with traditional trading, you enter into a contract to exchange legal ownership of individual stocks or commodities for cash, and you own them until you sell them again.
CFDs are leveraged products, which means that you only have to deposit a percentage of the total value of the CFD transaction to open a position. But with traditional trading, you buy the assets for the full amount. In the UK there is no stamp duty on CFD trading, but there is when you buy shares, for example.
CFDs attract overnight costs to hold trades (unless you are using 1-1 leverage), which makes them more suitable for short-term trading opportunities. Stocks and commodities are more normally bought and held longer. You might also pay a commission or brokerage fee when buying and selling assets directly and you would need a place to store them securely.
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