Bitcoin and ethereum prices ‘seem high,’ says Musk
FILE PHOTO: Tesla CEO Elon Musk speaks during the E3 gaming convention in Los Angeles
(Reuters) - Billionaire CEO Elon Musk said on Saturday the price of bitcoin and ethereum seemed high, at a time when the cryptocurrencies have hit record highs, with bitcoin crossing the $1 trillion market-capitalization threshold.
The chief executive of Tesla Inc, whose recent tweets have fueled the digital-currency rally, made the remark on Twitter while replying to a user who said that gold was better than both bitcoin and conventional cash.
Musk, who earlier in the week remarked that he found the prospect of holding bitcoin adventurous for an S&P 500 company, said in a tweet: “Money is just data that allows us to avoid the inconvenience of barter …”
“That said, BTC & ETH do seem high lol,” he added.
Bitcoin, the world’s most popular cryptocurrency, hit a fresh high in Asian trading on Saturday, extending a two-month rally a day after the digital currency’s market capitalization exceeded $1 trillion.
Ethereum or ether is the second-largest cryptocurrency by market capitalization and daily volume.
Musk, an ardent proponent of digital currencies, has defended Tesla’s recent purchase of $1.5 billion of bitcoin, which has ignited mainstream interest in the digital currency.
(Reporting by Bhargav Acharya in Bengaluru; Editing by Matthew Lewis)
Elon Musk admits that bitcoin and ethereum ‘seem high’ in exchange with ‘gold bug’ Peter Schiff
Elon Musk admitted that bitcoin and ethereum “seem high” in Twitter exchange with Peter Schiff.
The Tesla CEO retorted Schiff’s claim that Gold was a better asset allocation than crypto.
On Friday night, bitcoin hit record highs pushing its market cap to more than $1 trillion.
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Elon Musk isn’t one to shy away from speaking his mind on Twitter.
In his latest social media comments, the Tesla chief admitted the price of bitcoin and ethereum “seem high” as the crypto assets hit record highs.
Last night, bitcoin smashed through the $55,000 level, bringing the crypto’s market cap to more than $1 trillion. Its latest rally has largely been attributed to Tesla’s $1.5 billion purchase revealed in an SEC filing on Feb 8, sending Bitcoin up 16% on the day.
Musk’s comment was in reply to Peter Schiff, a well-known crypto skeptic and ‘gold bug,’ who claimed that gold was a better asset allocation than bitcoin or fiat currency.
Schiff’s was quoting Musk’s tweet that bitcoin was a “less dumb” version of cash.
“When fiat currency has negative real interest, only a fool wouldn’t look elsewhere,” Musk tweeted on February 19. “Bitcoin is almost as bs as fiat money. The key word is ‘almost.'”
But Musk responded to the veteran stockbroker claiming that: “An email saying you have gold is not the same as having gold. You might as well have crypto. Money is just data that allows us to avoid the inconvenience of barter.”
An hour later, the Musk followed up with a post saying: “that said, BTC & ETH do seem high lol.”
Musk/Schiff Twitter Exchange. Twitter
Bitcoin is now trading 55,563.02, according to exchange site Coinbase. Ethereum has gained 174.20% year-to-date, now trading at $2001.77.
Ether Rally Continues, For Now
Ether (ETHUSD), the digital currency native to the Ethereum ecosystem, is nearing a $2,000 milestone as more institutional buyers have boosted their positions in recent weeks. One Ether is currently equal to $1,962.09, an increase of more than 22 times compared to a year ago.
“We believe investors are looking to diversify and are growing increasingly comfortable with Ethereum fundamentals,” wrote James Butterfill, an investment strategist at CoinShares, in a research note on Feb. 8. The asset manager noted that the total fund flows were “unusually focused” on Ethereum, with 80% of the totaling $245 million allocated to Ethereum.
Grayscale Investment Holdings, the biggest global crypto asset manager, now has 3.16 million Ether under management as of Feb. 18, with Ether accumulation showing the biggest change in its portfolio over the past seven days, according to data compiled by bybt.com.
Institutional buyers, inclusion by companies like PayPal Holdings, Inc. (PYPL), and praise from individual investors like Mark Cuban have helped to make the case for ether. Cuban has said “ETH has an advantage over bitcoin as a store of value,” noting he’s buying more Ether, not Bitcoin (BTCUSD), in an interview with The Defiant podcast.
That makes sense, as Ethereum is more than just a cryptocurrency by design, allowing for so-called “smart contracts” on the blockchain. “Thanks so Ethereum, a blockchain could be about much more than digital currency,” writes Jeff Roberts in his book Kings of Crypto: One Startup’s Quest to Take Cryptocurrency Out of Silicon Valley and Onto Wall Street. “It was now also a one-stop shop where people could sign contracts over anything from sports wagers to investment agreements to data storage.”
In that sense, Roberts compares Ethereum to an ecosystem like Apple, Inc. (AAPL). “It served as a platform much like what Apple provides developers so they can build apps for its iOS operating system,” he wrote. “And unlike Bitcoin, Ethereum offered an easy-to-learn programming language, called Solidity, for anyone who wanted to build applications.”
Like any cryptocurrency, Ethereum exposure is not without inherent risk, with some analysts noting that the behavior of top traders at Huobi, Binance, and OKEx may suggest a “lack of appetite for long positions.” However, other observers forecast the cryptocurrency’s price pushing through to $2,700. Ether is still a relatively new digital currency, and its promise and applications across different industries may take time to unfold.
“Smart contracts on blockchain are real and they remind of the early days on the internet when people realized there was a network effect,” Cuban said, noting that it took 25 years from that early stage of development. “We are right at that point right now where smart contracts on top of blockchain allow people to take anything that’s digital and turn into a product and sell it.”