Category Archives: Cryptocurrency

Bitcoin climbs into positive territory after falling below $33,000 to a new low – CNBC

Bitcoin bounced into positive territory Monday after initially continuing its slide from last week.

On Monday, bitcoin fell to $32,982.11, its lowest point since July, according to Coin Metrics, but the largest cryptocurrency by market cap was up 5.6% in afternoon trading, to $37,183.25, as broader equities reversed course and ended the day higher. Earlier in the session, the Dow fell as much as 1,115 points and the S&P 500 briefly fell into correction territory.

Ether plunged to as low as $2,176.41, its lowest since July, according to Coin Metrics. It last rose 1.1% to $2,444.85. Bitcoin and ether are about 45% and 49% off their respective all-time highs.

Cryptocurrencies have been moving in tandem with stocks, which have continued to fall since the beginning of the year and just came off of their worst week since March 2020. Investors have been selling risk assets like technology stocks, as they prepare for tighter monetary policy from the Federal Reserve.

"It's possible that macroeconomic concerns, such as the Fed's response to inflation rates, have facilitated more de-risking activity in general," said Juthica Chou, head of OTC options trading at Kraken. "The recent price drop, coupled with high volatility, could be leading to further selling as participants look to reduce risk."

Investors also are assessing the impact of further regulation on the cryptocurrency market. Last week, Russia's central bank proposed banning the use and mining of cryptocurrencies.

Given current market sentiment, bitcoin is likely to test the $30,000-$32,000 range, according to Vijay Ayyar, Luno's vice president of corporate development and international expansion. If the cryptocurrency holds above $30,000 for as long as one week, there could be a base formed at those levels before the market moves higher, he said. However, it could be some time for the market to turn bullish given the lack of confidence across the spectrum, he added.

Several other analysts have said they see $30,000 as the next level of support for the cryptocurrency to test. However, analyst John Roque of 22V Research said bitcoin could fall even further. He also has been using $30,000 as a target but noted the median historical bear market for bitcoin is down 78%.

"A 78% decline from the bitcoin high of nearly $69,000 would imply a potential downside figure of about $15,000," he said in a note Monday. "It's probably safe to say that not one bitcoin bull has that figure in their model. To be sure, we don't either but we think it's worth keeping in our back pocket in case we need it."

Investors are also grappling with rising inflation. Bitcoin proponents have long suggested the digital coin is a hedge against inflation, but that theory has not held up for many newer investors. As institutional interest poured into bitcoin last year, there are more short-term investors in the crypto market valuing bitcoin like a tech stock than ever before. Analysts have said there's concern a more hawkish Fed could take the wind out of the crypto market's sails.

"Looking forward, our most immediate concern is how equities markets respond to this week's Fed meeting, especially after having just endured their worst week since the global onset of Covid," said Leah Wald, CEO at digital asset investment manager Valkyrie Funds.

"A consolidation in stocks would lead to a risk-on environment where traders are more willing to take on additional risk assets such as bitcoin," she added, "since digital assets have become increasingly correlated to equities as more companies continue to add bitcoin to their balance sheets. Volatility is likely to be a feature of bitcoin for at least the short term, as traders figure out where market sentiment isfollowing this week's Fed meeting."

Go here to read the rest:
Bitcoin climbs into positive territory after falling below $33,000 to a new low - CNBC

1 Cryptocurrency I’d Buy Right Now Without Any Hesitation – Motley Fool

I'll be the first to admit that I was initially skeptical about cryptocurrencies. Some of legendary investor Warren Buffett's criticisms of crypto seemed to make sense. For example, the legendary investor has stated that "cryptocurrencies basically have no value and they don't produce anything."

Now, my view is that Buffett is missing the mark -- at least with some cryptocurrencies. However, I'm still somewhat reluctant to dive in with some digital coins that I think have real growth potential because of my earlier reservations. But that's not the case across the board. Here's the one cryptocurrency I'd buy right now without any hesitation.

Image source: Getty Images.

Isuspect that Buffett wasn't all that familiar withEthereum (CRYPTO:ETH) when he has made negative comments about cryptocurrencies in the past. The Ethereum blockchain is used to produce things. Plenty of them.

So far, the Ethereum ecosystem includes thousands of decentralized applications. Over 4,000 developers actively work on the Ethereum platform -- way more than any other blockchain. In fact, more than 40 of the top 100 cryptocurrencies based on market cap are built on top of Ethereum.

The key to Ethereum's success is its support of smart contracts that automatically execute when specified events meeting contractual agreements are completed. Smart contracts make a wide array of applications possible, including non-fungible tokens (NFTs) and decentralized finance (DeFi) apps.

It's not surprising at all that Ethereum ranks as the second-largest cryptocurrency on the market based on market cap, trailing behind only Bitcoin. Ethereum seems destined to gain ground on Bitcoin and could eventually even claim the top spot.

Nothing is perfect, though. Ethereum has its drawbacks. In particular, the blockchain isn't nearly as fast as it could be. Its network can become congested. Ethereum's transaction fees are also high.

These flaws have attracted competition. Several newer blockchains are gaining adoption even faster than Ethereum is by addressing some of these limitations. This would give me pause about buying Ethereum if I didn't know that bigger and better things are on the way.

I like that the developers of Ethereum haven't stuck their heads in the sand and ignored the problems. Instead, they've laid out a clear path to fix the issues with the Ethereum 2.0 upgrade.

The first phase of the major upgrade has already been completed. The Beacon Chain, which supports staking on Ethereum and paves the way for future improvements, is live. Next on the plan is to merge this Beacon Chain with the Ethereum mainnet later this year. The final phase, which should be completed in 2023, will introduce shard chains that expand Ethereum's scalability.

When these upgrades are finalized, Ethereum will be much faster, cheaper, and more scalable. And it should be even more attractive to developers.

Are there any reasons to be hesitant about buying Ethereum? Over the short term, the answer is clearly "yes." I think the single biggest risk for Ethereum (and other cryptocurrencies) is a prolonged environment where investors shift to less risky assets.

If I focused only on the short term, this would definitely make me hem and haw. However, my view is that a long-term perspective is needed when investing in anything. For long-term investors, a "risk-off" period where Ethereum's price is lower presents a great buying opportunity.

There are some cryptocurrencies that I'd be worried about lasting for the long term. I think, though, that Ethereum has staying power. With the Ethereum 2.0 upgrade in progress, this cryptocurrency should be a winner over the next decade and beyond.

This article represents the opinion of the writer, who may disagree with the official recommendation position of a Motley Fool premium advisory service. Were motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.

See the original post:
1 Cryptocurrency I'd Buy Right Now Without Any Hesitation - Motley Fool

Coinbase makes it easier to report cryptocurrency taxes – The Verge

Coinbase, one of the largest and most popular cryptocurrency exchanges, is adding a new tax center to its app and website to help US customers work out how much they might owe to the IRS as a result of their crypto transactions, the company has announced. The section is designed to gather every taxable transaction into one place to simplify matters come tax day.

Although cryptocurrencies like Bitcoin often appear similar to the fiat money were accustomed to, in the eyes of the IRS, the digital assets are actually property, according to this FAQ from the federal agency. That means cryptocurrency transactions may need to be reported as capital gains or losses, and that means keeping track of a cryptocurrencys value as its bought and sold over time. Documenting these transactions can get complicated quickly if youre regularly buying and selling.

According to Coinbase, its new section will show a personalized summary of [a customers] taxable activity on Coinbase, broken out over time by realized gains/losses and miscellaneous income. This information can then be taken to an accountant or used with tax software like TurboTax. If youre someone whos transferred crypto to external exchanges, wallets, or other DeFi (decentralized finance) services, then Coinbase says its customers can also get tax reports for up to 3,000 of these transactions free with CoinTracker.

CNBC reported last year on suspicions that a lot of the taxes due on cryptocurrency transactions are going unpaid. Although confusion about the evolving tax rules about cryptocurrencies is one reason for this, another is that exchanges like Coinbase have historically not given as much help as traditional brokerage houses to customers when it comes to reporting their gains and losses for tax purposes.

The new Coinbase tax section is accessible from the profile icon in the top right-hand corner of the interface, where Taxes will appear as a menu item. In its app, the Taxes section is accessible from the Profile & Settings menu, accessible from the top left of the apps interface. In addition to the new tools, Coinbase is also planning to offer written guides and help videos in the coming weeks to explain cryptocurrency and digital asset taxes, but for now, this overview from CNET is a helpful place to start.

Read this article:
Coinbase makes it easier to report cryptocurrency taxes - The Verge

Curious about cryptocurrency? 4 ways to start investing without losing your shirt – CNET

Getty Images/Malte Mueller This story is part of So Money (subscribe here), an online community dedicated to financial empowerment and advice, led by CNET Editor at Large and So Money podcast host Farnoosh Torabi.

If I had a dollar for every email with the words "bitcoin" or "NFT" sent to me over the last few years, I'd be richer than some of the cryptocurrency millionaires making headlines.

OK, that may be an exaggeration. But I will say that in this sector it's exceedingly difficult to separate the fanfare from the fundamentals. As "experts" online tout crypto as the "investment of a lifetime," new datashows that a majority of young millionaires hold the bulk of their wealth in it. What's next? Kim Kardashian promoting an obscure cryptocurrency? Oh, wait...

Then there's the cryptocurrency market's recent steep sell-off, which points to its ongoing volatility and uncertainty about the future.

Through my efforts to learn more, I've found that investing experts and financial and tech journalists tend to agree that crypto hasbecome part of our lives andis not going away. At the same time, there's a ton of investor misguidance. Too many people are making financial moves off of pure adrenaline and speculation.

"Investing should be boring," says Georgia Lee Hussey, founder of Modernist Financial in Portland, Oregon. "If you're super duper excited about your portfolio, you're doing it wrong. Full stop."

Spencer Jakab, a longtime Wall Street reporter and author of the new book The Revolution That Wasn't, isn't convinced we have to participate at all. "There's no rhyme or reason to it ... I'm not a fan," he says.

But we can't help but be curious. Many of you have told me you want to understand how to start trying out this market in a clearheaded, substantive way. Are there ways to test the crypto waters that are measured, emotionally intelligent and rooted in a strategy? I have some ideas below.

One way to "invest" in the cryptocurrency market is by working for a crypto company. And now, there are more choices than ever. Crypto-related job opportunities surged 395% in the US between 2020 and 2021, according to LinkedIn. That's about four times more than job listings in the broader tech industry.

After spending most of her career working for conventional financial institutions like TIAA and BlackRock, corporate communications executive Lauren Post was tapped to join Bakkt, an Atlanta-based digital asset platform. Bakkt, which went public last fall, works with noncrypto companies that want to offer their clients cryptocurrency experiences. This includes working with credit card companies that offer cardholders crypto rewards, as well as teaming up with banks to help them integrate crypto trading with their platforms.

"I was both intrigued and slightly apprehensive because I didn't know much about crypto," said Post in an email. "But, after having spent my career at traditional financial services companies, I realized that learning about crypto couldn't be much different from learning about target date funds, fixed income, credit default swaps or any other corner of finance. I also realized that the skills I have unpacking complex topics for general audiences can be applied to any industry and are timely for the crypto space right now."

Not into pegging your cryptocurrency's success to a rally sparked by an Elon Musk tweet?

A new cryptocurrency genre called stablecoins bloomed in 2021, and unlike its peers, it promises less volatility and a more direct connection to traditional forms of value. Stablecoinsare like "cryptocurrency with a twist," according to CNET's Julian Dossett. He explains: "Instead of being 'mined' by an open, distributed network of computers performing a combination of math and record-keeping, a stablecoin derives its price from the value of another asset. In short, a stablecoin is pegged to some other underlying asset." Many stablecoins are fixed to the US dollar.

Think of a stablecoin as you would chips at a poker table, says Dossett. Instead of buying bitcoin or any other cryptocurrency directly with fiat money like the US dollar, you pay cash to buy stablecoins first -- they're available on most crypto exchanges including Coinbase -- and can then trade stablecoins for other forms of cryptocurrency.

The blockchain is the digital ledger that facilitates and records bitcoin transactions, but this technology can do more than power bitcoin. More broadly, due to its decentralization and cryptography, the blockchain can create much-needed efficiency and security to a number of markets from insurance to real estate, banking and legal.

If you're interested in learning about the crypto market, consider looking into the blockchain. It can be time well spent for someone seeking to enhance their business or examining how to leverage the technology where they work.

As an investor, I'm bullish on the concept of the blockchain. To that end, I've chosen to contribute a tiny portion of my retirement savings in a fund called BLOK, which comprises established companies such as Square, Paypal and Nvidia that are investing in blockchain technology.

Invest in cryptocurrency if you'd like to, but just because this is a new asset class doesn't mean abandoning tried-and-true methods of portfolio management. For starters, don't bet the farm. Hussey and many financial planners recommend limiting our holdings of so-called alternative and relatively high-risk assets like cryptocurrency, real estate and start-ups to no more than 5% of our total portfolio. "It is an asset class in its infancy," says Hussey. "We don't really understand the market because it's not built to be understandable."

Finally, invest in a bunch of currencies. No matter how confident you may be in a particular digital coin, remember that diversification helps to mitigate losses over time. (You don't want to be like some of the early investors during the dawn of the internet who went all in on pets.com.)

"If you're really confident about some bet, if you have some reason to believe you've got an edge, you still don't bet all your money because there's no sure thing," says Jakab. "To invest exclusively in a single category is something not even the best gamblers do."

Continue reading here:
Curious about cryptocurrency? 4 ways to start investing without losing your shirt - CNET

City council to hear request that would allow cryptocurrency mining tonight – Greenville Daily Reflector

The Greenville City Council is scheduled to meet online today to hear a dozen requests including one that would allow large data processing centers to operate in the city's jurisdiction.

The request that would allow Minnesota-base Compute North to build a facility that would support crypto currency mining has stirred opposition.

Opponents gathered at East Carolina University on Thursday to rally the support of students against the proposal.

A small group of organizers posted up between ECUs Main Campus Student Center and Joyner Library at 1 p.m., about a half an hour after ECU announced it was cancelling Friday classes due to expected inclement winter weather. Few students stopped at the rally site, but they did accept fliers from Chad Carwein, one of the organizers.

That the students accepted the flier, which had information about cryptocurrency mining and QR codes with a link to a change.org petition and the city councils meeting information, was positive, said Carwein.

They have so much information coming at them from so many sources, if they can take some time today to get some information . I think its a win, he said. Many people dont seem to know much about cryptocurrency, he said.

They dont know where it comes from or how much energy it uses, Carwein said. They were surprised to learn a bitcoin transaction uses as much energy as a household does in one month, he said. The data came from Digiconomist.com, a website dedicated to exposing the unintended consequences of digital trends.

All of a sudden their jaws drop, their eyes open up and they are paying attention, he said.

Carwein is ECUs sustainability manager, coordinating efforts to reduce energy usage and address other environmental challenges. Carwein said Thursday he wasnt on duty and was participating as a private citizen.

The council meets at 6 p.m. It will hold 12 virtual public hearings including a public hearing on a request to establish modular data processing facility and data processing center as two new uses in the city code and to define the associated standards and zoning districts where they will be permitted.

The data processing that occurs at these locations involves large groups of computer systems and accessory components that are used for remote storage, processing or distribution of large amounts of data, such as the computer processing needed for cryptocurrency mining.

Compute North sought to open an 89-unit modular data processing site on property near Belvoir Elementary School in the fall. The company withdrew its request after encountering intense opposition from parents whose children attend the school and neighboring residents.

Opponents raised concerns about noise from more than 1,000 fans used to cool the computing equipment and the amount of electricity the facility would require. There have been some locations that saw electric rates increase because the facilities drew too much power.

Greenville Utilities Commission said that will not happen locally because it has access to enough electricity to meet Compute Norths needs.

In December staff brought a request to Greenvilles Planning and Zoning Commission to amend the city rules permitting such a facility to operate in or near the city. Compute North confirmed it is working with local officials to find property in areas with industrial zoning to locate.

Opponents still worry about negative effects from its operation because some industrial zoned areas are near houses.

Were trying to address Greenville allowing cryptomining to happen in our community. Its effects are not well known and the (effects) that are known are not beneficial, said Owen Bergquist, one of the organizers of Thursdays event.

Crypto mining uses a lot of electricity to verify transactions, Bergquist said. GUCs electric supply comes from providers that use fossil fuels.

When these high energy computations are being used to validate transactions with cryptocurrency that is putting a lot of CO2 (carbon dioxide) into the atmosphere and setting us back on our energy goals, Bergquist said.

Mondays council meeting begins at 6 p.m. and is being held remotely via Zoom. It was originally scheduled for Jan. 13 but postponed because of COVID safety protocols.

Anyone who wants to participate in the public hearing can sign up at http://www.greenvillenc.gov on the city council meetings page. Written comments were due no later than 6 p.m. Sunday.

The proposed rule changes that supports cryptocurrency mining is one of 12 public hearings scheduled for Monday.

The other public hearing involve:

Other business on Thursdays agenda includes:

Go here to read the rest:
City council to hear request that would allow cryptocurrency mining tonight - Greenville Daily Reflector

Bitcoin price today: Cryptocurrency near its 6-month low after weekend battering – HT Tech

Bitcoin price today: The dollar traded steady on Monday ahead of the U.S. Federal Reserve's January policy meeting later this week, while Bitcoin lay bruised near a six-month low hit over the weekend, hurt by a sell-off in technology stocks.

"The Fed has got markets by the leash. And this week, it will once more tug and yank," said Frederic Neumann, HSBC's co-head of Asian economics research, in a morning note.

Attempts to predict when and how quickly central banks will raise interest rates and conclude stimulus programmes launched when COVID-19 hit are a major factor driving currency markets at present.

"What will prompt investors to scurry about will be the guidance Chair Powell might give at his press conference about quantitative tightening later in 2022," Neumann said, adding that he was not expecting a policy change.

The Fed's rate-setting Federal Open Market Committee kicks off its two-day meeting on Tuesday with some analysts starting to speculate that it is possible, though unlikely, that it will raise interest rates for the first time since the pandemic began.

"We consider the higher risk is the FOMCs statement portrays an urgency to act soon, likely in March, in the face of very high inflation. The urgency could culminate in a decision to abruptly stop quantitative easing by mid-February," said analysts at Commonwealth Bank of Australia in a note.

"A bullish statement and/or a faster end to the QE programme could even encourage markets to price a risk of a 50bp rate hike in March," they added, saying they thought this would lead to a knee-jerk reaction higher in the dollar.

The dollar index, which measures the greenback against six major peers was steady at 95.682 on Monday morning.

Also on traders' agenda this week is the Bank of Canada's January meeting, wrapping up just before the Fed, where a rate hike is a possibility, and Australian inflation data due Tuesday, which will guide the Reserve Bank of Australia's stance at its meeting next month.

On Monday morning the Aussie dollar was at $0.7180, the lower end of its recent range. The risk-friendly currency sold off late last week as traders dumped assets like equities, as well as even riskier assets like cryptocurrencies.

Bitcoin price was at $36,026, having fallen 10% on Friday and dropping as low as $34,000 on Saturday, its lowest level since July 2021.

The world's largest cryptocurrency has nearly halved in value since its record peak of $69,000 hit November.

The sell-off hurt most digital assets, and ether, the world's second-largest cryptocurrency was at $2,516, also having hit its lowest level since July on Saturday, which was $2,300.

Traders say that as institutional investors increase their exposure to cryptocurrencies, their moves are more closely correlated with other risk assets.

The Nasdaq Composite lost 7.55% last week, its worst week since March 2020.

Back in traditional currency markets, sterling was near a two-week low at $1.3551, and the euro was at $1.1333.

The yen was at the stronger end of its recent range, with one dollar at 113.7 yen not far from the 113.47 touched 10 days earlier. A fall below that level would be a five-week low for the dollar.

Continue reading here:
Bitcoin price today: Cryptocurrency near its 6-month low after weekend battering - HT Tech

Cryptocurrency in India: Demographic Survey of the Domestic Cryptocurrency Market – Analytics Insight

Cryptocurrency in India: Demographic Survey of the Domestic Cryptocurrency Market

The Analytics Insight survey showed that Indians who prefer to buy cryptocurrencies or have an interest in the cryptocurrency market are mostly in the age range of 20-40, the tech-savvy generation. Since there is a legal issue with transactions through cryptocurrencies from the Government of India, almost all age groups of Indians have started taking initiatives to have a strong understanding of the cryptocurrency market and its benefits.

As per the survey, out of 281 respondents, 76.5% of the respondents were in the age group between 20 years to 40 years old who were highly interested in the cryptocurrency market. 12.3% belonged to the age group 40-60 years old while only 11.1% comprised the age group below 20 years.

Cryptocurrencies are thriving in every part of the world despite getting banned from a few countries. The cryptocurrency market can drive smart decision-making processes to introduce alternative fast payment options according to the geographic locations. The findings in the Analytics Insight survey revealed that the western region of India including Mumbai, Pune, etc. has the highest number of investors for popular cryptocurrencies.

On the basis of geographic region, out of 281 respondents, 34.6% belonged to the West of India while the Northern region was in the second position with 24.7%. Tagging in the third position was the East of India with 17.9% whereas it could be seen that the South Indian region had shown only 17.3% interest in cryptocurrency in India.

It is estimated that the cryptocurrency-tech market in India can add an economic value of US$184 billion in 2030. Thus, multiple Indian industries have started leveraging blockchain technology for seamless payment processes with cryptocurrencies. 281 respondents work in different industries and this survey showed that people from almost all kinds of industries are highly interested in cryptocurrencies.

According to the survey of Analytics Insight with 281 respondents, the highest number of respondents belonged to the information technology and software industry with 24.7% while the second industry was the education industry at 23.5%, followed by the business sector with 12.3%. The banking and financial industry as well as the media and entertainment industry consisted of 9.9% of the respondents. It is followed by 1% of the respondents each for multiple industries such as engineering, house, medical and industrial gas, housewife, food, market research, and other industries.

The rising demand for multiple cryptocurrencies such as Bitcoin, Dogecoin, Ethereum, and hundreds of others has created a major impact on the economy of any country. Being a developing country, India is now focused on the cryptocurrency market and multiple investors, business people, companies, banks, and other financial institutions have started taking a huge interest in popular cryptocurrencies. Thus, this survey showed that the maximum respondents are interested in Bitcoin to yield profit in the nearby future.

The survey showed that 54.2% of the 281 respondents were highly interested in Bitcoin while Ethereum had 15.3% interest. Dogecoin is favourable to 10.2% of the respondents followed by Cardano with 5.1%. The survey further revealed that other cryptocurrencies such as Tether, Bitcoin Cash, Ripple, Binance Coin, Shiba, Ripple, Solana, and many more are favourable to 1% of the respondents each.

Share This ArticleDo the sharing thingy

About AuthorMore info about author

Analytics Insight is an influential platform dedicated to insights, trends, and opinions from the world of data-driven technologies. It monitors developments, recognition, and achievements made by Artificial Intelligence, Big Data and Analytics companies across the globe.

See more here:
Cryptocurrency in India: Demographic Survey of the Domestic Cryptocurrency Market - Analytics Insight

Cryptocurrency Fantom Down More Than 11% Within 24 hours – Benzinga – Benzinga

Over the past 24 hours, Fantoms (CRYPTO: FTM) price has fallen 11.03% to $1.97. This continues its negative trend over the past week where it has experienced a 37.0% loss, moving from $3.07 to its current price.

The chart below compares the price movement and volatility for Fantom over the past 24 hours (left) to its price movement over the past week (right). The gray bands are bollinger bands, measuring the volatility for both the daily and weekly price movements. The wider the bands are, or the larger the gray area is at any given moment, the larger the volatility.

The trading volume for the coin has risen 15.0% over the past week diverging from the circulating supply of the coin, which has decreased 0.31%. This brings the circulating supply to 2.54 billion, which makes up an estimated 80.04% of its max supply of 3.17 billion. According to our data, the current market cap ranking for FTM is #28 at 5.03 billion.

If you are interested in purchasing Fantom and want to know the best cryptocurrency exchanges, follow this link to Benzinga Money.

Do you want to learn more about trading and be able to analyze your own portfolio of stocks or cryptocurrencies? Consider signing up for Benzinga Pro. Benzinga Pro gives you up-to-date news and analytics to empower your investing and trading strategy. You can follow the link here to visit.

Powered by CoinGecko API

This post contains affiliate links from which Benzinga may earn a commission.

This article was generated by Benzingas automated content engine and reviewed by an editor.

Go here to read the rest:
Cryptocurrency Fantom Down More Than 11% Within 24 hours - Benzinga - Benzinga

Cryptocurrency Investing | Cryptocurrency Investment Types …

Why have cryptocurrencies like Bitcoin become so popular?

News about Bitcoin and other cryptocurrencies have been impossible to ignore. Investors hear news about overnight millionaires who lose their fortunes just as quickly. For example, a single bitcoin ranged in price from $1,000 in early 2017 to a high of over $64,000 in April 2021, with intense volatility in between.

Like many new technologies or products, cryptocurrency has attracted adherents interested in innovation and the perceived absence of governmental control. Traders saw it as an alternative to traditional investments such as stocks, bonds, and cash, and trading momentum led to a rising, if highly volatile, price. All of this attracted media attention, which drove mainstream awareness and, ultimately, increasing acceptance. Major companies, including Microsoft, PayPal, and Overstock now accept Bitcoin as a form of payment.

Cryptocurrencies are speculative investments, with significant volatility of cryptocurrency prices and the prices of indirect investments that have exposure to the cryptocurrency market. Cryptocurrency doesn't fit within traditional asset allocation models, as it is neither a traditional commodity, such as gold, nor a traditional currency. Its volatility is driven primarily by supply and demand, not inherent value. Bitcoin, for example, doesn't have earnings or revenues. It doesnt have a price-to-earnings ratio, price-to-sales ratio, or book value. Traditional value metrics don't apply, so there are no methods for assessing its value that we endorse or find persuasive beyond the trading value. Considering its volatility and the possibility that the entire value of a cryptocurrency investment could disappear, investors who dont think they could handle the market swings might want to steer clear.

There is also cryptocurrency risk besides volatility, as no regulatory infrastructure is in place for cryptocurrencies. Nothing exists yet to back you up like the Federal Deposit Insurance Corporation does for U.S. bank customers. That means investors are entirely responsible for the security of any cryptocurrency spot holdings. The SEC has noted that with cryptocurrencies, there is "substantially less investor protection than in our traditional securities markets, with correspondingly greater opportunities for fraud and manipulation."

Though you can get exposure to cryptocurrencies in multiple ways at Schwabtrusts, futures, and individual equitiesyou cannot currently buy or sell individual cryptocurrencies directly in a Schwab account.

We understand there is some client interest and engagement in cryptocurrencies, and we are looking closely and cautiously at this space. Clarity from regulators will be important before we consider offering a retail cryptocurrency experience. If we do, you can expect it to be a great value, designed to support client need and surrounded by the advice and education our clients have come to expect from us and deserve.

No, Schwab does not accept cryptocurrency deposits, nor do we accept or disburse cryptocurrencies for settlement of securities or futures transactions.

Some ETF products are available that provide indirect exposure to cryptocurrency and digital assets. Schwab clients can trade them in their brokerage account. They can be found in the Morningstar categories "Sector-Miscellaneous" and "Trading-Miscellaneous" using Schwab'sETF Fund Finder tool.

While several investment firms have submitted applications to the SEC for ETFs that hold cryptocurrency directly, none have been approved to trade in US markets.

Yes, a futures account is required to trade Bitcoin futures contracts, and certain requirements must be met to trade futures. Clients can log in and apply online to open a futures account.

The IRS treats cryptocurrency as property, not currency. Transactions in cryptocurrency spot markets are thus considered taxable by the Internal Revenue Service (IRS) whenever a taxable event occurs, such as selling cryptocurrency for a fiat currency (i.e., U.S. Dollars, Euros, etc.) or when traded for another asset. Investors are responsible for tracking cost basis, gains, and other reporting. If you have questions or concerns about the potential tax implications of transacting in cryptocurrencies, you should refer to this IRS publication or consult with a tax advisor.

Blockchain is the underlying technology that supports cryptocurrencies like Bitcoin. It is an open-source, public record-keeping system operating on a decentralized computer network that records transactions between parties in a verifiable and permanent way. Blockchain provides accountability, as the records are intended to be immutable, which presents potential applications for many businesses. While blockchain has often been associated with cryptocurrency, it has many potential uses beyond payments, including smart contracts, supply chain management, and financial services. Note that ownership of Bitcoin or other cryptocurrencies is not an investment in blockchain, the technology, or its current or future uses.

View original post here:
Cryptocurrency Investing | Cryptocurrency Investment Types ...