Bitcoin stealthily moved over the $9,000 mark overnight, despite the continuing noise coming out by financial watchdogs.
While I still believe bitcoin is the blue chip of the cryptocurrencies, over the last month’s rise it has lagged other acceptable digital currencies in appreciation. Ripple soared 85% and ethereum is up almost 65% over the last two weeks, while litecoin and bitcoin trail with roughly 36% appreciation over the same time frame.
Over the same two months the US dollar has strengthened 200 bps, which if you consider BTC a currency, has more to do with bolstering investor sentiment than market regulators pronouncements.
Plot dollar index against any crypto over the last two months and you will see the correlation, though the crypto moves are far more dramatic due to liquidity.
However, incoming NY Fed chief John Williams (cue “Star Wars” opening theme) felt the need over the weekend to share his thoughts of cryptos in general:
“The setup or institutional arrangement around bitcoin and other cryptocurrencies, first of all they have problems with fraud, problems with money laundering, terror financing. There’s lots of problems there… The idea of the supply of currency and thinking about currency really belongs more in the sphere of government and central banks. My view is it’s more a promise of technology.”
Praise the blockchain, hate the currency. Where have I heard that before.
I believe the best way to broadly move cryptos into general acceptance is to curtail ICO market from offering digital coins based on flimsy — if at all — white papers cribbed from other unsuccessful ICOs.
Public confidence needs to be built to expand the base for true price appreciation.