19 February 2021

Bitcoin Tops $50,000 As Crypto’s Institutional Takeover Soars

The reported ‘bubble’ that is not showing signs of bursting any time soon, Bitcoin’s price surged to a new all time high of $52,000 this week before settling at around $51,700 at the time of publishing. This record shattering rally brings the coin’s year to date gain to an impactful 74%, and showing a growth of 260% since November of 2020. As Bitcoin’s rally has continued, the world’s second largest cryptocurrency Ether also hit a record high of $1,918, translating into a year to date price surge of 160%, surpassing even that of Bitcoin.  

Tesla Purchase Signals Institutional Takeover

This comes after an eventful couple of weeks for the world of cryptocurrency as major firms have given it a boost of confidence, creating unprecedented rally for the coins. 

The digital assets were lunged into their latest climb when the electric vehicle company Tesla announced an impressive purchase of $1.5 billion worth of Bitcoin. The clean energy car company also signaled that they would likely begin accepting payments in Bitcoin in exchange for their products. This use of corporate cash in exchange for crypto sparked excitement amongst many who saw it as the beginning of the future of cryptocurrency. Additionally, the latest price trends in the crypto market prove that this current bull run is different than that of the 2017 bubble as they involve unprecedented demand from major players in the market. In comparison, the 2017 bubble was mainly fueled by retail speculation.  

Investment Firm Predicts Bitcoin’s Price Could Quadruple in 2021

Amid this rally, boutique investment research firm Fundstrat has more than doubled their 2021 Bitcoin price prediction, repositioning their projected valuation from $40,000 to $100,000. The firm cited several factors influencing this updated projection, many of which revolving around strong and growing institutional interest in the coin. 

Fundstrat also released a list of other possible reasons for Bitcoin’s bullish price, including an anticipated governmental stimulus, the interest of equity investors in BTC, and a surge in the coin’s demand on both PayPal and Coinbase. The firm also cited domestic tension as a possible factor that could push the price of Bitcoin further up, as well as “tension abroad”. If their target is accurate, this could mean that Bitcoin may just top $100,000 by the end of 2021. 

MasterCard Announces Further Crypto Integration Coming This Year

Multinational financial services corporation MasterCard has announced that it would be allowing customers to use select cryptocurrencies on its network later on this year. MasterCard Inc.’s CEO Michael Miebach detailed this plan of crypto embrace by saying that they have put forth a set of principles (including regulatory compliance, stability, and consumer protection such as data privacy) that would be guiding in order to begin the process of deciding which currencies to adopt onto the MasterCard network. Miebach stated that they were working to enable crypto owners to make use of their digital assets as fiat currency through MasterCard’s network. 

Additionally, MasterCard has also launched a prepaid card service for one of the world’s first central bank digital currency (CBDC) in the Bahamas. People using this card now have the option to load their MasterCard with CBDC and use it anywhere around the world as it can be converted into Bahamian dollars right on the network. This CBDC is called the Sand Dollar, and aims to resolve the existing problem of moving cash around and between the Bahamas’ 700 islands. The Sand Dollar is also set to be made available to tourists, solving yet another annoyance for future travelers. Miebach also revealed that MasterCard was talking to several other central banks around the world in order to hopefully replicate this move. 

Morgan Stanley Evaluates Bitcoin, While BNY Mellon is Ready to Roll-Out

Also hopping on the institutional train are major banking and finance firms Morgan Stanley and BNY Mellon, each at their own speed. The $150 billion investment arm of Morgan Stanley Counterpoint Global is currently evaluating the possibility of getting involved in Bitcoin as crypto continues to inspire even the most traditional investors of Wall Street. This Morgan Stanley unit is currently looking into how cryptocurrency could make for a strong choice for their investors. 

With more eagerness, Bank of New York Mellon is leaping into the world of crypto by announcing plans to issue, hold, and transfer Bitcoin, effective later on this year. BNY Mellon has already started the process of building a platform to support crypto transactions, and aims to launch in 2021. This comes nearly two months after the Office of the Comptroller of the Currency announced that banks could begin using blockchain based currencies for transactions, thus signaling adoption on both a governmental and institutional level. BNY Mellon’s embrace of crypto would make it one of the most traditional financial institutions to take on digital coins as of yet, and certainly the oldest. 

With large firms like Tesla, BNY Mellon, and MasterCard on board, many are considering 2021 to be the year of institutional adoption in the world of crypto. As more big names begin expressing interest in digital coins, key players such as Uber have not failed to comment on the matter, stating that they would be open to accepting crypto on their networks. 

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