I remember when it was trading at $1000. Today, bitcoin surpassed record-shattering $50k a coin. (After just hitting $40k a few weeks ago!)
So, what’s driving this rally?
For starters, this crypto currency has gone mainstream.
Once a favorite among internet users conducting financial transactions on illicit “dark web” sites like Silkroad.com, bitcoin has been normalized. BlackRock, Mass Mutual, BNY Mellon, Skybridge Capital, Tesla, and Mastercard are all buying into the currency, thereby helping to drive prices higher.
But, what exactly are these institutions buying?
Bitcoin, like gold, has no instrinsic value. Nonetheless, the crypto currency does have so amazing blockchain technology backing it up. Meanwhile, though it’s still too volatile to function like an actual currency, it has taken on a new kind of relevance in a cancel culture world.
A “Cancel Culture” Currency
A new report alleges that Bank of America may have handed over the account information of hundreds of innocent people in connection with the deadly riot last month on Capitol Hill.
According to a report on Fox News, the nation’s second largest bank allegedly reviewed the records of certain purchases made in and around Washington DC near the time of the riot, and the reportedly provided the FBI with information on 211 people. None of those people were arrested. Security experts insisted it was a form of overreach.
Regardless of what may or may have not happened and the reasons for it, the Bank of America issue does raise questions as to what kind of access the Feds have to our finances.
Meanwhile, the recent “de-platforming” of Parler highlights the vulnerability of individual businesses who might be subjected to the politically motivated decisions of the government and specific organizations. In Parler’s case, it was kicked off its Amazon server with no real warning and remained off-line for over a month until yesterday. At the time, there was concern about whether Parler may have contributed to the violence by allowing people to connect and communicate on its platform. This is something other social media companies have been accused of in the past and something Parler is trying to address in its resurrection online.
But, again, the sudden deactivation shows the challenges of companies trying to operate online with the help of servers.
If the government can work with banks to comb through your spending habits and servers can be disbanded with the flip of a switch…to some, bitcoin represents a way to protect themselves against an overzealous government. Its transactions are done through a pure-play peer-to-peer platform that is not as easy to track, nor as easy to discontinue or “shut off”.
In this environment, the crypto-currency takes on an added aura of appeal.
Like gold, bitcoin has no instrinsic value. Nonetheless, the technology it represents and the privacy it may afford, are increasingly valuable in today’s society.
Whether or not it becomes a full fledged currency may still be in doubt, but, as I said when it was $1000, and again at $30,000 — this will be in some way part of our future. For more on bitcoin, you can listen to my American Consequence’s interview with SkyBridge Capital’s Founder Anthony Scaramucci by clicking here (the Mooch believes it is heading into the multiple hundred’s of thousands of dollars territory) — and do make sure to download and listen to the second block of today’s podcast for more of my thoughts on the crypto currency here below.