Bitcoin enjoys bullish run with crypto-believers’ backing

Bitcoin is enjoying a moment in the sun after rolling past the $10,000 mark on Monday evening. The currency had spent most of Monday sitting at $9,600 until it rocketed to a high of $10,429 on digital currency exchange. The sudden surge caught many traders by surprise as over $123 million worth of short positions were squared away on the BitMEX system alone. While the digital currency hit a three-month high, the US president was preparing to send local police and the National Guard to disband crowds of protestors on White House grounds.

It’s been a tumultuous week for the country as the death of George Floyd sparked riots across cities and states. While bitcoin's buoyancy is notable in the middle of the country’s mayhem, the link between cryptocurrency and political rights movements has been seen in other countries experiencing civil unrest – such as when Hong Kong's protests spurred a broader acceptance of alternate currencies like bitcoin. Similar themes have been seen in the 2019 protests of Chile, Colombia, Venezuela, Argentina, Bolivia, Ecuador, and Peru.

Conversely, a Goldman Sachs (NYSE: GS) report released last week slammed Bitcoin as an option for their clients. "We do not recommend bitcoin on a strategic or tactical basis for client's investment portfolios even though its volatility might lend itself to momentum-oriented traders,” they said. The firm asserts that cryptocurrencies are not an asset class as they do not generate cash flow or earnings or provide consistent diversification benefits.

Crypto-believers took to Twitter in defense of blockchain-based currencies and pointed to its current run as proof of positive things. Illustrious Wall-Street-investor-cum-crypto-evangelist Michael Novogratz shared his thoughts in a Tweet shortly before the currency run north of $10,000: "BTC is coiling. It will take out 10k soon. All the tragic turmoil in the USA adds to the narrative. Budgets are going one way, and it's the opposite of balanced. When 10k goes, it will move fast. Get on the train."

Raoul Pal, the current CEO of Real Vision and former Goldman Sachs head of hedge fund sales in Europe, also chimed in with his bullish take on cryptocurrency. The chief executive shared a tweet with a chart after bitcoin hit $10,000. The graph showed the coin's upward trend past the five-digit mark with the attached comment "No big deal."

Even investment legend Paul Tudor Jones is sidling up to cryptocurrency after buying bitcoin futures through his $40 billion hedge fund. Jones likened buying bitcoin to “owning the fastest horse” in the approaching inflationary race ahead, stating, “If I am forced to forecast, my bet is it will be bitcoin.’” While it wasn’t clear whether his futures investment would be settled in cash or bitcoin, the real message is a growing acceptance of crypto as a potential Wall Street asset.

 

Photo by Clifford Photography on Unsplash

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Disclaimer: The writer is an experienced financial consultant who writes for Finscreener.org. The observations he makes are his own and are not intended as investment or trading advice.