Bitcoin price hangs in balance after chaotic week – latest

The price of bitcoin is down 7 per cent overnight, dropping to below $35,000 on Saturday morning and bringing other leading cryptocurrencies down with it.

Ethereum (ether) fell to $2,300, building on losses over the last seven days to register a week-on-week drop of around 15 per cent. It’s even worse news for dogecoin, which is now down by nearly 20 per cent.

The reason for the dip is not immediately clear but it remains a delicate time for the market, with whichever direction it takes from here potentially confirming a longer term trajectory.

The president of El Salvador has shared his vision for how the 100 per cent renewable, volcano-powered bitcoin mines will look – and it may not be a vision for long.

President Nayib Bukele revealed that he has instructed LaGeo, El Salvador’s state-backed energy company, to allow bitcoin miners to tap into the constant energy flowing from the country’s geothermal plants.

“This is going to evolve fast,” he said, less than two days after securing the cryptocurrency’s legal tender status.

A day later he wrote: “Designing this as we tweet.”

The International Monetary Fund has raised concerns about El Salvador adopting bitcoin as legal tender, saying it “raises a number of macroeconomic, financial and legal issues that require very careful analysis”.

The IMF is expected to meet with El Salvador president Nayib Bukele to discuss the Bitcoin Law, which received Congressional approval on Monday and will put the cryptocurrency on equal footing with the US Dollar in the Central American country.

Potentially complicating things for Bukele, should these discussions not go well, is that El Salvador is currently in separate talks with the IMF over a $1 billion program.

Early bitcoin advocate and financial journalist Max Keiser suggested the bitcoin community could easily step in, should this be the case. “The IMF can go f*** themselves,” he tweeted.

The CEO of Twitter has said it is “only a matter of time” before Twitter integrates the Bitcoin Lightning Network.

The Layer 2 payments network significantly improves the efficiency of bitcoin transactions, with some claiming it is the key to transforming the cryptocurrency into a day-to-day currency. (You can read more about it here.)

Jack Dorsey, whose Twitter bio simply reads “Bitcoin”, was responding to a follower’s suggestion to “build LN into BlueSky or Twitter please and thank you”.

Elon Musk will not be involved with the Bitcoin Mining Council, which has been set up to address the environmental concerns surrounding the cryptocurrency.

The newly formed group describes itself on its website as a “voluntary and open forum of bitcoin miners committed to the network and its core principles”. It is open to any bitcoin miner and will hold quarterly meetups to discuss industry trends.

Musk spoke with North American bitcoin miners last month, describing the initiative as “potentially promising”.

Clarifying his involvement with the group, the Bitcoin Mining Council’s website states: “Elon Musk has no role at the BMC. The extent of his involvement was joining an educational call with a group of North American companies to discuss bitcoin mining.”

These are the founding members:

The president of Iran has become the latest world leader to propose a legal framework for cryptocurrencies.

President Hassan Rouhani told the government’s Economic Coordination Board that there should be cooperation between “agencies in the field of capital markets” and people within “the field of information, education and public awareness”.

According to his official website, President Rouhani said: “For legalizing the activity of cryptocurrencies and protecting people’s capital in this area, we must think of a solution as soon as possible and lay down and communicate the necessary laws and instructions.”

State Street, the second oldest bank in the US, has announced plans to launch a “multi-asset platform” that will support cryptocurrency trading.

The custody bank, which oversees more than $40 trillion in assets, said the move was driven by customer demand.

“We are at a tipping point now where this is moving fast,” Nadine Chakar, who will head State Street Digital, told the Financial Times.

“We are getting calls from endowments and foundations that are getting donations in crypto and saying ‘what do we do with this?’ We are seeing companies that are thinking of adding crypto to their balance sheets.”

Bitcoin has been formally recognised as an asset class by the Basel Committee, the arbiter of international banking standards, by proposing rules for banks to hold the cryptocurrency.

The rules will also apply to other leading cryptocurrencies like Ethereum (ether), with all of them being placed in the high risk category.

Bitcoin saw an immediate jump in price of $2,000, further boosting an already buoyant crypto market. It marks yet another major milestone for bitcoin into the world of traditional finance.

And the Basel Committee’s press release here:

Yet another multi-billion dollar asset management company has announced plans to enter the cryptocurrency space.

Victory Capital, which manages nearly $160 billion in assets, established exclusive agreements with Nasdaq and crypto-focussed asset manager Hashdex in order to launch a private fund for accredited investors that will track the Nasdaq Crypto Index (NCI).

“We continually strive to provide our clients with the forward-thinking choices they want and believe cryptocurrency is a viable asset class that can be part of a well-diversified portfolio,” said Mannik Dhillon, CFA, CAIA, President, VictoryShares and Solutions.

“By investing in a portfolio designed to track the NCI, investors can seek returns that align with the cryptocurrency market in a diversified manner, gaining exposure to multiple digital assets as this market continues to evolve and mature. We are actively considering other vehicles and wrappers to bring these capabilities to a broader set of investors.”

More positive news coming out of El Salvador this morning, this time relating to bitcoin’s environmental impact.

President Nayib Bukele has instructed the head of the country’s state-owned geothermal electricity company to offer facilities for bitcoin mining, to allow the cryptocurrency to be created using 100 per cent renewable energy.

“This is going to evolve fast!” he tweeted.

Engineers are reportedly already working on designs for the project, while mining firms appear to be keen to offer any help they can in setting up rigs.