The Cryptocurrency Informer
Bitcoin gains a Baron; A Nasdaq company invests big into Bitcoin; JPMorgan continues to apologize for anti-crypto sentiments by investing more money!
This week is all about big mainstream money going into crypto: famous internet pizza man Dave Portnoy goes all in on Bitcoin, a publicly-traded NASDAQ company bought a couple hundred million dollars worth of BTC, and JPMorgan may be investing $50 million in a very well-known blockchain tech company.
August 14th, 2020: Bitcoin gains a Baron; A Nasdaq company invests big into Bitcoin; JPMorgan continues to apologize for anti-crypto sentiments by investing more money!
(00:36) First up, Dave Portnoy has become the self-proclaimed Baron of Bitcoin. For those unfamiliar, Dave Portnoy is the founder of the sports and pop culture blog Barstool Sports. He’s also well-known for his pizza review video channel, One Bite Reviews, and his fairly recent foray into day trading.
On Thursday, Portnoy released 10 minute a video of him, Tyler Winklevoss, and Cameron Winklevoss.
The video starts with Portnoy talking about how he got into crypto – his followers continuously told him to move from day trading traditional stocks to investing in crypto. From there, via the magic of Twitter, the Winklevoss twins became involved in the effort to convert Portnoy into a crypto connoisseur. Cameron and Tyler Winklevoss are the founders of the cryptocurrency exchange Gemini, and are very vocal about their support for mainstream crypto adoption. Enticing the well-known internet personality known to many as El Presidente was likely a no-brainer and should yield returns for them on both their company and their adoption endeavors. The brothers have attempted to educate and convert other high profile celebrities in the past, including J.K. Rowling and Kanye West.
The video consists of the Winklevoss Twins attempting to explain some of the basic tenets of Bitcoin, cryptocurrency, and blockchain technology. They clarify distinction between mining and buying Bitcoin, and how their crytpcurrency exchange Gemini is similar, in the crypto world, to a stock-trading website like E*Trade. They call Bitcoin “internet gold” and explain how the scarcity affects the value – contesting that real gold’s scarcity can be changed by Elon Musk space mining asteroids, whereas Bitcoin’s scarcity can not be changed, cementing it as the “only fixed asset in the galaxy”.
Portnoy semi-jokes about creating his own token, the “Dave Coin”, and muses on the idea of Elon Musk and the Winklevoss twins promoting his coin so that they all become Bitcoin Billionaires. The joke becomes a bit more serious when the brothers offer up some engineers to help code his coin, which leads Portnoy to talk about the coin’s potential success helping the three of them “zoom past the success” of Mark Zuckerberg.
After the brief lesson, Portnoy purchases $200,000 worth of Bitcoin and $50,000 worth of the Ethereum-based coin Chainlink (LINK), which has “had a pretty big month or two”.
After all is said and done, what does this pretty unique interaction and video mean for cryptocurrency? Well, Dave Portnoy has already consistently been tweeting to his 1.7 million followers to buy BTC since the video’s release – that’s certainly a good thing for overall adoption and increasingly visibility to a mainstream audience. Some are hoping for a “Portnoy Effect” that will push Bitcoin past the $12,000 mark. We’ll have to wait and see if that happens!
(03:14) From $200,000 invested into BTC to $250 million invested in Bitcoin…our next story is about largest independent publicly-traded business intelligence company MicroStrategy. On Tuesday, the company announced via press release that they had purchased 21,454 BTC at an aggregate purchase price of $250 million dollars. According to the release, this purchase was part of a two-pronged capital allocation strategy to invest in “alternate investments or assets” to “maximize long-term value for our shareholders”.
The CEO of MicroStrategy stated “This investment reflects our belief that Bitcoin, as the world’s most widely-adopted cryptocurrency, is a dependable store of value and an attractive investment asset with more long-term appreciation potential than holding cash.” And that “Our decision to invest in Bitcoin at this time was driven in part by a confluence of macro factors affecting the economic and business landscape that we believe is creating long-term risks for our corporate treasury program…[including], among other things, the economic and public health crisis precipitated by COVID-19, unprecedented government financial stimulus measures including quantitative easing adopted around the world, and global political and economic uncertainty…[which] may well have a significant depreciating effect on the long-term real value of fiat currencies and many other conventional asset types.”
Of course, these are arguments that we hear quite often in the cryptocurrency community, but this move by a publicly traded company worth 1.2 billion is unprecedented and could yield some seriously positive implications for Bitcoin and cryptocurrency in general.
(04:55) Our final story involves another traditional financial giant, JP Morgan Chase. We’ve discussed their (recent) heavy interest in cryptocurrency and blockchain technology in past episodes – they have their own blockchain called Quorum and their own digital coin JPMcoin.
In the past, JPMorgan certainly wouldn’t be considered an ally of cryptocurrency – the CEO Jamie Dimon infamously called Bitcoin a “fraud” back in 2017. However, he later walked those words back, and since then, the company has certainly been pumping resources into crypto and blockchain tech.
This week, it has been rumored, and reported, by multiple crypto news outlets that JPMorgan is close to investing $20 million into the blockchain technology company ConsenSys. ConsenSys is an Ethereum-based blockchain development company with “full-stack Ethereum products [that] help developers build next-generation networks and enable enterprises to launch more powerful financial infrastructure.” The development company already has an established relationship with JPMorgan, as a merger between Quorum and ConsenSys has been in the works since the beginning of 2020.
The rumors this week of a potential $20 million dollar investment seems to indicate a full-on partnership is on the horizon. This massive deal involving a traditional financial company that historically rejected cryptocurrency is one of many events that speaks to the resilience, legitimacy, and adaptability of crypto and blockchain tech. It’s almost inevitable that we’ll be reporting on more traditional financial institutions investing major resources into the world of cryptocurrency and blockchain.
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