Stocks in the next week: what bitcoin is like as a teenager

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What’s Happening: Bitcoin’s dizzying climb has reached new heights. The price of one bitcoin first passed $ 20,000 in December. Last week it surpassed $ 50,000.

The euphoria drawn by the markets certainly plays a role as investors looking for returns in a low-interest world keep an eye out for alternative investments. But a series of recent announcements have also made it clear that cryptocurrencies are entering a new stage of maturity as market participants treat them with growing respect.

“I think the kind of institutions that are starting to come in now speak volumes about adoption,” said Greg King, CEO of Osprey Funds. Last week, his company launched the Osprey Bitcoin Trust, which aims to increase the exposure of everyday investors.

It gave an important signal when Tesla TSLA, an S&P 500 company, said it added $ 1.5 billion in bitcoin to its balance sheet earlier this month, King said. Not long after, BNY Mellon – the oldest US bank – launched a digital asset unit to issue, hold, and transfer bitcoin while MasterCard MA said it would support “select cryptocurrencies” directly on its network later this year.
Even Black rock BLK, the world’s largest asset manager, dips its toe in the water.

“People are looking for valuable warehouses,” said Rick Rieder, Chief Investment Officer Global Fixed Income at BlackRock, in a recent interview with CNBC. “We got into it a little bit.”

Bitcoin is by far the best option for professional investors looking at cryptocurrencies. But ether, the second largest cryptocurrency by market value, is also gaining popularity.

The Chicago Mercantile Exchange, one of the largest derivatives marketplaces, launched ether futures in early February. Prices have risen sharply since then.

King stressed that more work is needed as cryptocurrencies mature.

“All these institutional caliber tools that make up the capital markets ecosystem… which is still in very early stages for the crypto space,” he said.

On the Radar: Most traditional market players are still researching bitcoin, assessing the liquidity of crypto markets, and how they would respond to various shocks.

There remains a deep skepticism. In a research report published last week, JPMorgan strategists called bitcoin an “ economic side show, ” noting that cryptocurrencies “ remain several times more volatile than core asset markets ” and are still used almost exclusively for speculation and not spending.

But given the events of the past month, the direction of travel is hard to dispute.

“The rise of digital finance and the demand for fintech is the real financial transformational story of the Covid-19 era, not the rise in bitcoin prices,” said JPMorgan. “But the recent announcements of greater adoption and acceptance by Tesla, BNY Mellon and Mastercard confirm increased investor demand and interest in handling cryptocurrency payments.”

Biden’s incentive bill is moving forward

Dual support may be difficult to obtain. But after weeks of debate, President Joe Biden’s massive $ 1.9 trillion Covid bill will slide through Congress.

The latter: The House Budget Committee is taking steps to finalize the legislation so that it can pass to a general vote. House speaker Nancy Pelosi said she would like to see that this week.

The sweeping bailout package, which would then be kicked to the Senate, includes another round of $ 1,400 incentive vouchers, an extension of the tax credit for children, and an increase in the minimum wage to $ 15 an hour.

Bottleneck: Democrats plan to pass the legislation through a process known as reconciliation, allowing for Senate approval by just 51 votes. The Senate is divided 50-50 along party lines. Vice President Kamala Harris has the ability to step in and act as a tie-breaker.

That means Democrats cannot afford to lose the support of even a single member of their party. And some moderate lawmakers have made it clear that the $ 15 minimum wage increase is not supported.

Looking at the calendar: Pelosi has said she expects the Covid aid package to be on Biden’s desk on March 14, when current unemployment benefits end. The clock is ticking.

Next one

Tuesday: Confidence of the American consumer; HSBC HBCYF DIY store HD Macy’s M. and Square SQ earnings; Apple AAPL shareholders meeting
Wednesday: Sales of new homes in the US; Lowe’s LOW Office Depot ODP TJX TJX, Booking of holding companies, L brands LB Nvidia NVDA and ViacomCBS LAKE earnings
Thursday: First unemployment claims in the US; Anheuser-Busch InBev BUTTON Domino’s Pizza DMPZF Best Buy BBY Cars.com CARS JM Smucker SJM Modern MRNA Papa Johns PZZA Beyond Meat BYND Etsy ETSY Live Nation LYV, Nikola, Virgin Galactic SPCE and Sales team CRM earnings

Friday: India GDP; Information about personal income and expenses in the US; DraftKings earnings

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