The electronic Chinese yuan is now being tested in cities such as Shenzhen, Shanghai and Beijing. No other major power is as far along with a homegrown digital currency. From a report: Annabelle Huang recently won a government lottery to try China's latest economics experiment: a national digital currency. After joining the lottery through the social media app WeChat, Ms. Huang, 28, a business strategist in Shenzhen, received a digital envelope with 200 electronic Chinese yuan, or eCNY, worth around $30. To spend it, she went to a convenience store near her office and picked out some nuts and yogurt. Then she pulled up a QR code for the digital currency from inside her bank app, which the store scanned for payment. "The journey of how you pay, it's very similar" to that of other Chinese payments apps, Ms. Huang said of the eCNY experience, though she added that it wasn't quite as smooth.

China has charged ahead with a bold effort to remake the way that government-backed money works, rolling out its own digital currency with different qualities than cash or digital deposits. The country's central bank, which began testing eCNY last year in four cities, recently expanded those trials to bigger cities such as Beijing and Shanghai, according to government presentations. The effort is one of several by central banks around the world to try new forms of digital money that can move faster and give even the most disadvantaged people access to online financial tools. Many countries have taken action as cryptocurrencies such as Bitcoin, which has recently soared in value, have become more popular. But while Bitcoin was designed to be decentralized so that no company or government could control it, digital currencies created by central banks give governments more of a financial grip.

Goldman Sachs Group has restarted its cryptocurrency trading desk and will begin dealing bitcoin futures and non-deliverable forwards for clients from next week, Reuters reported Monday, citing a source. From the report: The team will sit within the U.S. bank's Global Markets division, the person said. The desk is part of Goldman's activities within the fast-growing digital assets sector, which also includes projects involving blockchain technology and central bank digital currencies, the person said. As part of this work, the bank is also exploring the potential for a bitcoin exchange traded fund and has issued a request for information to explore digital asset custody, the source said. The trading desk reboot comes amid growing interest by institutions in bitcoin, which has soared more than 470% over the past year. The largest cryptocurrency is seen by investors and some companies as a hedge against inflation as governments and central banks turn on the stimulus taps.

From a report: Microsoft CEO Bill Gates has an interesting take on who should buy Bitcoins. He being the third richest man in the world said that Bitcoins are not for him because he has less money than Tesla CEO Elon Musk. So basically anybody who has less money than Musk should not invest in Bitcoin...

Gates during an interview with Bloomberg TV had said that Bitcoin is not for everyone and only the richest person in the world should consider investing in it. "Elon has tons of money and he's very sophisticated, so I don't worry that his Bitcoin will sort of randomly go up or down.I do think people get bought into these manias who may not have as much money to spare. My general thought would be that if you have less money than Elon, you should probably watch out," Gates said in the interview.
Last week Australia's national broadcast reported that even Elon Musk "has made it clear that he views cryptocurrency as 'speculation.'" On February 7 (the night before Tesla revealed its massive bet on crypto), Mr Musk was on his way to have dinner with his children at an upmarket steakhouse in West Hollywood. Before he reached its front door, he was intercepted by a legion of adoring fans — who demanded autographs, while peppering him with questions about the cryptocurrency market.

The world's richest man had been talking up bitcoin, along with a "joke" currency called "dogecoin", which has surged about 900 per cent since the year began. There were signs that Mr Musk was worried that some of his fans might be taking his recent crypto jokes as genuine investment advice.

"People should not invest their life savings in cryptocurrency, to be clear — that's unwise," Mr Musk said, in his clearest warning yet.

"There's a good chance that crypto is the future currency of Earth, and it's like... which one's it going to be? Maybe it'll be multiple. It should be considered speculation at this point.

"So don't go too far with the crypto speculation front."
Later in the video Musk adds, "Don't bet the farm on crypto."

The University of Cambridge Centre for Alternative Finance has calculated that Bitcoin's total energy consumption is somewhere between 40 and 445 terawatt hours (TWh) a year, with a central estimate of about 130 terawatt hours, reports the BBC: The UK's electricity consumption is a little over 300 TWh a year, while Argentina uses around the same amount of power as the CCAF's best guess for Bitcoin. And the electricity the Bitcoin miners use overwhelmingly comes from polluting sources. The CCAF team surveys the people who manage the Bitcoin network around the world on their energy use and found that about two-thirds of it is from fossil fuels....

We can track how much effort miners are making to create the currency. They are currently reckoned to be making 160 quintillion calculations every second — that's 160,000,000,000,000,000,000, in case you were wondering. And this vast computational effort is the cryptocurrency's Achilles heel, says Alex de Vries, the founder of the Digiconomist website and an expert on Bitcoin. All the millions of trillions of calculations it takes to keep the system running aren't really doing any useful work. "They're computations that serve no other purpose," says de Vries, "they're just immediately discarded again. Right now we're using a whole lot of energy to produce those calculations, but also the majority of that is sourced from fossil energy."

The vast effort it requires also makes Bitcoin inherently difficult to scale, he argues. "If Bitcoin were to be adopted as a global reserve currency," he speculates, "the Bitcoin price will probably be in the millions, and those miners will have more money than the entire [U.S.] Federal budget to spend on electricity."

"We'd have to double our global energy production," he says with a laugh. "For Bitcoin."
Ken Rogoff, a professor of economics at Harvard and a former chief economist at the IMF, tells the BBC that Bitcoin exists almost solely as a vehicle for speculation, rather than as a stable store of value that can be easily exchanged.

When asked if the Bitcoin bubble is about to burst, he answers, "That's my guess." Then pauses and adds, "But I really couldn't tell you when."

"Bitcoin's rally this year has hit a speed bump, putting it on track for the worst weekly slide in almost a year amid wider losses in risk assets," reports Fortune: The largest cryptocurrency slumped as much as 20% this week, the most since March, and was holding at about $46,925 as of 10:22 a.m. in Hong Kong. The wider Bloomberg Galaxy Crypto Index, tracking Bitcoin, Ether and three other cryptocurrencies, is down 22% this week...

Bitcoin's weakness in the face of market gyrations raises questions about its efficacy as a store of value and hedge against inflation, a key argument among proponents of its stunning fivefold rally over the past year. Detractors have maintained the digital asset's surge is a speculative bubble and it's destined for a repeat of the 2017 boom and bust.

While Bitcoin is often touted as the new "digital gold," the yellow metal is winning out at the moment with spot gold holding at $1,768 per ounce, down less than 1% for the week.

In the 10 years since Chris Torres created Nyan Cat, an animated flying cat with a Pop-Tart body leaving a rainbow trail, the meme has been viewed and shared across the web hundreds of millions of times. On Thursday, he put a one-of-a-kind version of it up for sale on Foundation, a website for buying and selling digital goods. In the final hour of the auction, there was a bidding war. Nyan Cat was sold to a user identified only by a cryptocurrency wallet number. The price? Roughly $580,000. From a report: Mr. Torres was left breathless. "I feel like I've opened the floodgates," he said in an interview on Friday. The sale was a new high point in a fast-growing market for ownership rights to digital art, ephemera and media called NFTs, or "nonfungible tokens." The buyers are usually not acquiring copyrights, trademarks or even the sole ownership of whatever it is they purchase. They're buying bragging rights and the knowledge that their copy is the "authentic" one.

Other digital tokens recently sold include a clip of LeBron James blocking a shot in a Lakers basketball game that went for $100,000 in January and a Twitter post by Mark Cuban, the investor and Dallas Mavericks owner, that went for $952. This month, the actress Lindsay Lohan sold an image of her face for over $17,000 and, in a nod to cryptocurrencies like Bitcoin, declared, "I believe in a world which is financially decentralized." It was quickly resold for $57,000. People have long attached emotional and aesthetic value to physical goods, like fine art or baseball cards, and have been willing to pay a lot of money for them. But digital media has not had the same value because it can be easily copied, shared and stolen.

Blockchain technology, which is most often associated with Bitcoin, is changing that. NFTs rely on the technology to designate an official copy of a piece of digital media, allowing artists, musicians, influencers and sports franchises to make money selling digital goods that would otherwise be cheap or free. In an NFT sale, all the computers hooked into a cryptocurrency network record the transaction on a shared ledger, a blockchain, making it part of a permanent public record and serving as a sort of certification of authenticity that cannot be altered or erased. The nascent market for these items reflects a notable, technologically savvy move by creators of digital content to connect financially with their audience and eliminate middlemen. Some NFT buyers are collectors and fans who show off what they have bought on social media or screens around their homes. Others are trying to make a quick buck as cryptocurrency prices surge. Many see it as a form of entertainment that mixes gambling, sports card collecting, investing and day trading. Eye-popping NFT sale prices have attracted some of the same confusion and derision that have long haunted the cryptocurrency world, which has struggled to find a good use for its technology beyond currency trading.

Coinbase on Thursday released documents for its public debut on the Nasdaq stock exchange via a direct listing. In the filing, the digital trading platform cited as a risk factor Bitcoin's creator, Satoshi Nakamoto -- the pseudonym used by the person or group of people who created bitcoin. From a report: If the identity of the creator was revealed, it could cause bitcoin prices to deteriorate, according to the filing. The filing also referenced Nakamoto's personal stash of bitcoins, which totals over 1 million. As of February, one bitcoin was worth about $50,000. Nakamoto could negatively affect Coinbase, the company said, and destabilize the entire crypto market if the creator decided to transfer his bitcoins, which are valued at over $30 billion.

Square said today it has purchased approximately 3,318 bitcoins at an aggregate purchase price of $170 million. From a statement: Combined with Square's previous purchase of $50 million in bitcoin, this represents approximately five percent of Square's total cash, cash equivalents and marketable securities as of December 31, 2020.

The price of bitcoin — now over $57,000 — has nearly doubled in the last 7 weeks. Even Elon Musk tweeted that its price seems high — though one analyst tells Bloomberg that Tesla has already made a profit of nearly $1 billion from its recent Bitcoin investment, more than it earned selling electric cars in all of 2020.

Yet speaking about bitcoin, Bill Gates said "It'd be good to get rid of that" in a recent interview with the Wall Street Journal, arguing that cryptocurrency "allows for certain criminal activities."

And the world's third-wealthiest man also seemed dubious about the significance of GameStop's stock surge: Bill Gates told CNBC the Reddit-fueled trading mania in GameStop and other stocks was reminiscent of betting at a casino and not investing. "People enjoy gambling. Sadly, it's a zero-sum game," the billionaire philanthropist told CNBC's Andrew Ross Sorkin in an interview that aired Thursday on Squawk Box. "The idea that you drive a valuation way, way beyond what is rational, it's hard to see that societally as a good use of time," Gates added. "And, you know, the people who get in it early get a windfall. The people who get in late feel like suckers...."

Gates expressed concern about the role social media played in the GameStop saga and its potential implications for the U.S. equity market. "Reddit forums where people have a reason to kind of push something and get out at those high prices, you know, the SEC has got to look at this because we don't think of the stock market as just performing a casino-like role," said Gates, the third-wealthiest person in the world. "We have restrictions on gambling activities...."

Some have said the GameStop craze carried populist characteristics, with smaller investors trying to stick it to hedge funds and big Wall Street firms. Gates said if that really were the aim of individual investors, it will not end well. "If the general public investor is pitted against the hedge funds, over time, the hedge funds will come out ahead," said Gates. "I'm sure there'll be lots of stories of people who got caught up in the frenzy, which really served no societal purpose."

The dogecoin market has a pack leader. From a report: Records show that a person, or entity, owns about 28% of all of the cryptocurrency in circulation -- a stake worth about $2.1 billion at current prices [Editor's note: the link may be paywalled; alternative source]. The holder's identity isn't known, which is common in the opaque world of digital currencies. It is hard to tell what to make of this giant position in what has long been a small and niche corner of the cryptocurrency world. Dogecoin was created in 2013 as a satirical homage to bitcoin. Its developers were riffing off the meme of a Shiba Inu dog with bad spelling habits. It wasn't designed to be used as a form of payment, or as anything except a joke. At the start of 2021, a dogecoin was worth about half a cent, even as bitcoin prices had surged to nearly $30,000.

Things have changed this year. Dogecoin surged in popularity after business and pop-culture icons including Tesla's Chief Executive Officer Elon Musk, rapper Soulja Boy and "Malcolm in the Middle" star Frankie Muniz began promoting it online. It isn't clear what caught their attention. Dogecoin's price has climbed over 900% this year to 5 cents apiece, according to CoinDesk. That makes the market worth about $6.9 billion, and puts its largest owner's holdings at roughly $2.1 billion. Like bitcoin, dogecoin is created by a process known as mining: people solve complex mathematical puzzles using computers to unlock new coins. It is nearly impossible to identify the holder due to the anonymity offered by cryptocurrencies.

The price of Bitcoin (BTC) has reached a new all-time high of $53,670, pushing the coin's total market capitalization above $1 trillion, according to crypto metrics platform CoinGecko. Market capitalization is the total number of coins currently in circulation multiplied by their current market price -- basically, the combined worth of all existing BTC. From a report: By various estimations, the value of all money in the world is around $95 trillion -- and now Bitcoin represents about 1% of that. While it's not totally fair to compare Bitcoin to money (it can be seen as an asset instead), it provides one way to put it in perspective. Speaking to Decrypt, Quantum Economics analyst Jason Deane noted that for people who were involved in the crypto space from its early days, the $1 trillion BTC market capitalization may have been a long time coming but it was inevitable.

New York's attorney general filed a lawsuit on Wednesday to shut down the cryptocurrency platform Coinseed for allegedly defrauding thousands of investors, including by charging hidden trading fees and selling "worthless" digital tokens. From a report: Attorney General Letitia James said Coinseed traded cryptocurrencies such as bitcoin without registering as a broker-dealer, and sold "CSD" tokens without authorization to raise money for its mobile application startup. James also sued Coinseed Chief Executive Delgerdalai Davaasambuu and former Chief Financial Officer Sukhbat Lkhagvadorj, saying they overstated the midtown Manhattan-based company's management experience, while Lkhagvadorj misrepresented himself as a former Wall Street trader. Coinseed's fraud totaled more than $1 million, according to James, who is also seeking restitution for investors. The U.S. Securities and Exchange Commission filed a related lawsuit against Coinseed and Davaasambuu over the tokens, which both regulators said were sold from December 2017 to May 2018.

Bitcoin blew through another milestone, surging past $50,000 for the first time as the blistering rally in the largest cryptocurrency continues to captivate investors worldwide. From a report: The world's largest cryptocurrency jumped as much as 4.9% to $50,548 and is now up about 70% so far this year. Bitcoin pared its gain after setting the record high. Ether, a rival crypto, hit a record on Friday and is up about 140% year-to-date. After ending last year with a fourth-quarter surge of 170% to around $29,000, Bitcoin token jumped to $40,000 seven days later. It took just nearly six weeks to breach the latest threshold, buoyed by endorsements from the likes of Paul Tudor Jones, Stan Druckenmiller and Elon Musk. Bitcoin traded for a few cents for several years after its debut more than a decade ago.

Miami's mayor Francis Suarez is trying to attract tech talent to his city. (The New York Times recently noted he's joined by "a few venture capital influencers trying to tweet the city's startup world into existence.") So he's still pushing a proposal to use bitcoin in a few city operations as "part of a larger play if you will to position Miami as one of the most tech-forward cities in the country," according to Reuters.

Bloomberg reports: The mayor wants to allow the City of Miami's workers to choose to receive all or a portion of their pay in Bitcoin, according to a resolution passed by the city's governing commission. In addition, the mayor proposed allowing people to pay all or part of property taxes or city fees in crypto.

Although the commission approved the resolution 4-1, it significantly dialed back its original wording. It only agreed to study the practicality of such steps, rather than taking action, as the original proposal had suggested...

Suarez also wants the city to analyze the feasibility to invest some government funds in Bitcoin, the resolution said. It's not clear how much of that is actually possible: Florida statutes have strict limitations on how local governments can invest surplus funds, generally restricting investments to low-volatility instruments such as those issued by the U.S. government. In the past year alone, Bitcoin has shown it can double in price — or lose half its value — in a month's time....

Ken Russell, vice-chairman of the city commission, said he's "certainly not opposed" to the idea of integrating Bitcoin into the city's business, but it's important to ensure "we all know what we're getting into."

"What needs to be done is diligence, and not just from the legal perspective," he said in an interview Wednesday. "It's not just a currency, it's a concept."
Bloomberg also points out that the mayor of the City of Miami "doesn't control the budget or municipal workforce or get a vote on the commission.

"He asked voters to give him more managerial power, but the initiative failed."

Canada's main securities regulator has cleared the launch of the world's first bitcoin exchange traded fund, an investment manager said on Friday, providing investors greater access to the cryptocurrency that has sparked an explosion in trading interest. Reuters reports: The Ontario Securities Commission has approved the launch of Purpose Bitcoin ETF, Toronto-based asset management company Purpose Investments Inc. said in a statement. The OSC confirmed the approval in a separate statement to Reuters. "The ETF will be the first in the world to invest directly in physically settled Bitcoin, not derivatives, allowing investors easy and efficient access to the emerging asset class of cryptocurrency," Purpose Investments said.

Investors have been able to trade bitcoin using futures contracts on the CME derivatives exchange. They can also buy closed-end investment funds, such as the Bitcoin Fund on the Toronto Stock Exchange. [...] In the United States, eight firms have tried without success since 2013 to create a bitcoin ETF, according to Todd Rosenbluth, director of ETF and mutual fund research at New York based CFRA. Among issues the Securities and Exchange Commission appears to be focused on are the potential for market manipulation and the process of custody audits that verify that a fund holds its purported assets.

The kingpin or kingpins of the world's biggest illicit credit card marketplace have retired after making an estimated fortune of over $1 billion in cryptocurrency, according to research by blockchain analysis firm Elliptic shared with Reuters. From the report: The "Joker's Stash" marketplace, where stolen credit cards and identity data traded hands for bitcoin and other digital coins, ceased operations this month, Elliptic said on Friday, in what it called a rare example of such a site bowing out on its own terms. Criminal use of cryptocurrencies has long worried regulators, with U.S. Treasury Secretary Janet Yellen and European Central Bank President Christine Lagarde calling last month for tighter oversight. While terrorist financing and money laundering are top of law-enforcement concerns, narcotics, fraud, scams and ransomware are among the chief areas of illegal use of digital currencies, according to Elliptic co-founder Tom Robinson. Joker's Stash was launched in 2014, with its anonymous founder "JokerStash" -- which could be one or more people -- posting messages in both Russian and English, Elliptic said. It was available on the regular web and via the darknet, which hosts marketplaces selling contraband.

Twitter and Square CEO Jack Dorsey and rapper Jay Z have created an endowment to fund bitcoin development initially in Africa and India, Dorsey said Friday. From a report: The duo is putting 500 bitcoin, which is currently worth $23.6 million, in the endowment called Btrust. The fund will be set up as a blind irrevocable trust, Dorsey said, adding that the duo won't be giving any direction to the team. Btrust is looking to hire three board members. The mission of the fund is to "make bitcoin the internet's currency," a job application describes. Government in India has so far been reluctant to embrace bitcoin and other cryptocurrencies. Friday's move comes as New Delhi is inching closer to introduce a law that would ban private cryptocurrencies in the nation. It is also looking to create its own digital currency.

Thelasko shares a report from the BBC: Bitcoin uses more electricity annually than the whole of Argentina, analysis by Cambridge University suggests. 'Mining' for the cryptocurrency is power-hungry, involving heavy computer calculations to verify transactions. Cambridge researchers say it consumes around 121.36 terawatt-hours (TWh) a year -- and is unlikely to fall unless the value of the currency slumps. Critics say electric-car firm Tesla's decision to invest heavily in Bitcoin undermines its environmental image.

The online tool has ranked Bitcoin's electricity consumption above Argentina (121 TWh), the Netherlands (108.8 TWh) and the United Arab Emirates (113.20 TWh) - and it is gradually creeping up on Norway (122.20 TWh). The energy it uses could power all kettles used in the UK for 27 years, it said. However, it also suggests the amount of electricity consumed every year by always-on but inactive home devices in the US alone could power the entire Bitcoin network for a year. "Bitcoin is literally anti-efficient," David Gerard, author of Attack of the 50 Foot Blockchain, explained. "So more efficient mining hardware won't help -- it'll just be competing against other efficient mining hardware. This means that Bitcoin's energy use, and hence its CO2 production, only spirals outwards. It's very bad that all this energy is being literally wasted in a lottery."

In regard to Tesla's decision to buy bitcoin, Mr Gerard added: "Elon Musk has thrown away a lot of Tesla's good work promoting energy transition. This is very bad... I don't know how he can walk this back effectively. Tesla got $1.5 billion in environmental subsidies in 2020, funded by the taxpayer. It turned around and spent $1.5 billion on Bitcoin, which is mostly mined with electricity from coal. Their subsidy needs to be examined."

Twitter's finance chief said the social-media company has thought about how it might pay employees or vendors using the popular cryptocurrency bitcoin. From a report: Chief Financial Officer Ned Segal, in speaking Wednesday with Andrew Ross Sorkin on CNBC's "Squawk Box," said the company continues to review potential uses of the digital currency. "We've done a lot of the upfront thinking to consider how we might pay employees should they ask to be paid in bitcoin, how we might pay a vendor if they ask to be [paid] in bitcoin and whether we need to have bitcoin on our balance sheet should that happen," Mr. Segal said. "It's something we continue to study and look at, we want to be thoughtful about over time, but we haven't made any changes yet."

Twitter Chief Executive Jack Dorsey is a bitcoin advocate. Payment company Square, which Mr. Dorsey also leads, recently acquired about $50 million worth of bitcoin for its corporate treasury. Mr. Segal's comments came days after electric-vehicle maker Tesla said it had purchased $1.5 billion in bitcoin. Tesla also said Monday that it expects to start accepting the cryptocurrency as payment from customers soon. The Twitter CFO said the company is weighing a number of factors in considering what role, if any, the cryptocurrency might play in its business.

Bitcoin jumped to a record high after Mastercard and Bank of New York Mellon moved to make it easier for customers to use cryptocurrencies. From a report: The largest digital asset rose as much as 7.4% to $48,364, surpassing the all-time high reached Monday after Tesla announced it would hold $1.5 billion of the cryptocurrency on its balance sheet. The wider Bloomberg Galaxy Crypto Index also touched a record. "The crypto-asset world is bursting into the realms of traditional finance at a staggering pace," said Simon Peters, an analyst at investment platform eToro. Mastercard singled out so-called "stablecoins," which often peg their value to that of another asset, such as the U.S. dollar. Mastercard has already partnered with crypto card providers such as Wirex and BitPay, but has required digital currencies to be converted into fiat before processing payments for transactions on its network.