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Bitcoin's back on top, but it's not a boon for everyone in the space

Dan DeFrancesco   

Bitcoin's back on top, but it's not a boon for everyone in the space
  • This post originally appeared in the Insider Today newsletter.

Happy Super Tuesday! Here's a rundown of everything that's at stake for the slew of primaries and caucuses set to take place across the country.

In today's big story, we're looking at bitcoin's latest rally and what's driving it so high this time around.

What's on deck

But first, a crypto comeback for the ages.

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The big story

Bitcoin's breakout

Stop me if you've heard this before: Is bitcoin back?

The world's largest and most well-known cryptocurrency is close to eclipsing its all-time high of nearly $69,000. The milestone comes amid a massive rally for bitcoin over the past month, where its price has surged almost 60%. The NFT market even showed signs of life!

You're forgiven if you're not sold on bitcoin's latest bump. The crypto community has a history of hyping big price moves only for bitcoin to fall back to Earth.

But this time around, things do feel a bit different. Business Insider's Phil Rosen has a full rundown on what's pushing bitcoin's price so high this time.

One puzzle piece is bitcoin ETFs, which launched earlier this year. BlackRock's iShares Bitcoin Trust drew $520 million in a single day, the second-largest daily inflow for a US ETF.

A bitcoin halving event is also expected next month, the first since 2020. That means lowering the incentives for bitcoin miners and cutting the amount of bitcoin issued daily, which puts more pressure on supply.

Bitcoin's resurgence also comes in the face of high interest rates, in contrast to its peak at the end of 2021 when rates were almost zero.

A boon for bitcoin doesn't mean everyone in the space wins.

One industry insider I spoke with last week said crypto startups remain in a tough spot, especially those later in their lifecycle. The funding environment is difficult for all young companies, but those banking on reinventing industries like gaming with crypto tech are really struggling.

Others see the momentum from the halving being short-lived. JPMorgan predicted bitcoin could drop as low as $42,000 once the dust settles. (To be sure, the bank's CEO, Jamie Dimon, is notoriously bearish on bitcoin.)

But what might be most concerning is the range of speculation surrounding the rally's root cause. The insider I spoke to said there's no single, agreed-upon narrative for what's driving crypto toward a new peak.

As worrisome as that might seem, it's also reminiscent of the state of the wider economy. On any given day, you can likely find strong cases from market experts for and against the chances of a hard or soft landing.

3 things in markets

1. The economy is in too good of a shape, according to Dr. Doom. Perma-bear Nouriel Roubini said the biggest threat to stocks is that the economy is doing so well. If growth stays high, the Fed could abandon its plans to cut interest rates, sending shockwaves through the market.

2. Speaking of growth, Bank of America just bumped its S&P 500 price target. The bank is now projecting the benchmark index will hit 5,400 by year-end, which would mean a 5% increase from its current level. But it won't be easy, as BofA still sees a market pullback occurring along the way.

3. China sets itself an ambitious growth goal. Beijing wants the economy to grow 5% this year, Premier Li Qiang said Tuesday. Hitting that target won't be easy, he acknowledged, with policymakers still battling headwinds including deflationary pressures and a seemingly neverending property-market crisis.

3 things in tech

1. Apple has a massive problem. The company was hit with a nearly $2 billion fine after the European Commission determined it had restricted app developers from informing users about other, cheaper music services. But Apple's real problem is the way its investors reacted.

2. How to work under Mark Zuckerberg's "Eye of Sauron." Meta CEO Andrew Bosworth used the "Lord of the Rings" reference to describe Zuck's intense focus on the company's most important tasks. He said being "in the fire" is an invaluable experience for employees.

3. OpenAI workers feel confused. Employees at the ChatGPT developer still don't have much clarity about CEO Sam Altman's dramatic ousting and return late last year, two witnesses to a recent all-hands meeting told BI. Altman has promised that an internal investigation will be "over soon," without going into any more detail.

3 things in business

1. Using a bot to apply to jobs isn't as smooth as it seems. A new breed of bots promises to send out applicants' résumés to hundreds of jobs at a time. But sometimes the AI makes stuff up about the applicant, making them look really, really bad.

2. Boomers explain how they overcome loneliness in retirement. With loneliness at an all-time high following the pandemic, some older people are organizing meetups and making new friends within their community. They say even small connections can be a "lifesaver."

3. We got another hint that the new sports streamer will cost around $50 a month. Fox CEO Lachlan Murdoch said on Monday that pricing will "be in the higher ranges of what people have talked about." He believes the new service can pick up 5 million subscribers within five years of its launch — but questions remain about who'd actually want to pay so much money for it.

In other news

What's happening today

  • Today's earnings: Nordstrom, Target, and other companies are reporting.

  • Today is Super Tuesday, when voters in 16 states cast their ballots.

The Insider Today team

Dan DeFrancesco, deputy editor and anchor, in New York. Jordan Parker Erb, editor, in New York. Hallam Bullock, editor, in London. George Glover, reporter, in London.

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