Bitcoin Reaches Past $50,000, Now Worth 2.4 Million Pesos

“Learn as much as you can about Bitcoin and what it means from a technological, monetary, and network standpoint. Bitcoin is still very new.”

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Bitcoin breaches past $50,000, a new all-time high for the dominant cryptocurrency after a parabolic rally that saw it first drop to $3,800 in March 2020 then break past the psychological resistance of $20,000 in December 2020. Bitcoin continued its momentum in 2021, culminating in a new all-time high today.

At this price milestone, it is worth looking back at Bitcoin’s incredible rally within the past 5 months and the news that accompanied each milestone. A series of key events contributed to the turnaround in the price that we see today.

For every price level, we also highlight it with art created for that specific Bitcoin milestone by Luis Buenaventura, the artist behind “CryptoPop!” and also the Co-founder of BloomX, a licensed virtual asset service provider in the country. Luis’ pieces can be found on MakersPlace.

May 2020, Bitcoin at $8,000

In May 2020, Bitcoin underwent an event called the “Bitcoin halving,” when the issuance of Bitcoin rewards got cut down in half. From 12.5 bitcoins that miners receive after confirming a block, it was cut to 6.25. Also in May, Paul Tudor Jones, the legendary investor publicly announced that he put a portion of his portfolio into Bitcoin. At that time, Jones said he saw Bitcoin’s movement akin to gold’s in the 1970s. “The best profit-maximizing strategy is to own the fastest horse,” Jones told Bloomberg. “If I am forced to forecast, my bet is it will be Bitcoin.”

August 2020, Bitcoin at $9,000

On August 11, 2020, Microstrategy, the largest independent publicly traded company in the U.S. announced acquisition of 21,454 bitcoins as its primary reserve asset. CEO Michael Saylor said their decision is a “capital allocation strategy” driven by the depreciating long term value of fiat currencies. “Bitcoin is digital gold – harder, stronger, faster, and smarter than any money that has preceded it,” Microstrategy said in a statement.

October 2020. Bitcoin at $10,724

Square, a fintech company whose CEO is Bitcoin advocate and Twitter Co-founder Jack Dorsey, announced it bought 4,709 bitcoins, worth $50 million at that time, as part of its larger investment to the cryptocurrency ecosystem. This amount is 1% of Square’s total assets. Square, in a statement, said that as Bitcoin grows in adoption, it plans to learn and participate in the ecosystem in a disciplined way. “For a company that is building products based on a more inclusive future, this investment is a step on that journey.”

On October 21, 2020, PayPal Holdings announced it would soon allow its 246 million users to buy, sell and hold cryptocurrency within its PayPal and Venmo apps. Initially only available to U.S. customers, it would be rolled out to more countries by 2021.

Bitcoin is not without its share of negative news. OKEx, one the major global cryptocurrency exchanges announced suspension of withdrawals after one of its key executives, which holds one of the “keys” needed to execute withdrawals, was arrested by Chinese authorities. At the time this article is written, OKEx customers still cannot withdraw on the platform.Also last October, the U.S. Commodity Futures Trading Commission charged BitMEX, one of the largest Bitcoin derivatives exchanges, of failing to impose adequate Anti-Money Laundering (AML) and Know-Your-Customer (KYC) procedures. The U.S. Department of Justice also charged BitMEX key executives for violating the country’s Bank Secrecy Act.

December 2020, Bitcoin at $20,000

After breaking past $20,000, the three-year psychological resistance, a massive inflow of institutional investors have revealed they own Bitcoin or put a portion of their portfolio into Bitcoin. Guggenheim Investments’ Chief Investment Officer Scott Minerd, in an interview that shocked Bloomberg TV hosts said his firm is valuing Bitcoin at $400,000.

January 2021, Bitcoin at $30,000

Bitcoin briefly went past $40,000 but was unable to sustain that in January. What instead happened were massive price $8k – $10k price swings that would normally give a heart attack to anyone new to crypto. Reports surfaced that institutional investors were taking advantage of the “dips” to add more Bitcoin into their holdings. 

But while Guggenheim continued fomo-ing the market by advising retail traders to sell to take profit, one key personality, Elon Musk, the world’s richest man, edited his Twitter bio to simply say “#Bitcoin”, and then tweeted: 

February 2021, Bitcoin at $40,000

Weeks later, it was revealed that Musk’s company – Tesla, has invested $1.5 billion into Bitcoin. Just like that, and the price never went below $40,000.

At $50,000, What Now

Eventually, if we subscribe to Guggenheim’s idea of a six-digit Bitcoin price, one would say that the current price point is still very early. However, Bitcoin and its wild price swings are never friendly to retail investors. It’s one reason why regulators have been keen to regulate crypto companies, ensuring that retail investors participating in the cryptocurrency economy are well informed of the risks involved when  purchasing crypto.

Bitcoin, the dominant cryptocurrency outside a thousand others, is classified as a “virtual asset” in the Philippines by the Bangko Sentral ng Pilipinas. While the central bank acknowledges crypto’s “potential to transform the provision of financial services,” it is also aware of the risks it posed to the financial system and the consumers who may be less informed about how crypto works. Recognizing that the crypto space are not just trading platforms and to better align with the standards set by the Financial Action Task Force (FATF), a global policy-setting body on anti-money laundering, the BSP released its “updated guidelines for virtual asset providers,” while at the same time, encouraging Filipinos to deal only with licensed VASPs.

“The BSP has issued public advisories to encourage the public to deal only with BSP-registered VCEs, and to be mindful of the risks of using virtual currencies,” – BSP

What’s Next For Bitcoin?

In an interview on ANC, Miguel Cuneta, Co-founder of Bitcoin company Satoshi Citadel Industries Ventures said $50,000 is the price level where people will start paying attention to Bitcoin. “I emphasized on START,” Miguel told me in a Telegram interview. “We are almost at $1 trillion market cap for BTC, and after $1T, $2T, and so on. There’s no foreseeable top because of the trillions of fiat flooding the market. The macroeconomic environment is a perfect storm for this,” he added.

With Tesla investing in Bitcoin, he believes other large companies will follow in allocating a small single digit % of their free cash flows, cash that is losing purchasing power, said Miguel. “There’s nothing much out there in terms of an alternative asset, a hedge, much like gold. Bitcoin has WAY more upside than gold in the networked age, and is better in every property that makes gold a good monetary asset,” he added, citing that Bitcoin’s volatility might mean more big swings but these companies are not day trading but rather “hodling” for the long term. 

Advice to New Entrants

At this price level, many new investors might be more interested in buying Bitcoin, but Miguel advised new entrants to learn more about Bitcoin first. “Learn as much as you can about Bitcoin and what it means from a technological, monetary, and network standpoint. Bitcoin is still very new.”

“Get a feel for it, how to use it, how to store it, etc. It isn’t for everyone, not everyone will want or need it, so find out it if it is for you. But it is there, it exists, it is open to everyone, it’s all voluntary.”

This article is published on BitPinas: Bitcoin Breaks Past $50,000, Worth 2.4 Million Pesos

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