Bitcoin was expected to explode in 2024 as two transformative events sent the price rocketing to $50,000, $100,000 or even $250,000 by the end of the year, depending on who you believed.
January was supposed to blast the cryptocurrency right into the mainstream, when the US Securities and Exchange Commission finally gave the green light to spot Bitcoin exchange-traded funds. Call it the Bitcoin big bang.
Spot Bitcoin ETFs will open the controversial asset class to a vast new pool of investors by making it easier, cheaper and safer to track the No 1 cryptocurrency’s price movements.
The second big move is the next Bitcoin block reward “halving”, due in April, when the amount paid to miners is slashed in a pre-programmed move to reduce supply and maintain its scarcity value.
Well, the first is in and has turned out to be a damp squib. After an initial sharp rise in interest on the SEC's approval, Bitcoin quickly gave up its gains.
Has hype raced ahead of reality again?
On January 10, the SEC announced the supposedly game-changing news that it was giving regulatory approval to the first spot Bitcoin ETFs in the US.
The SEC approved 11 ETFs in total, including offerings from fund management behemoths BlackRock, Fidelity, Ark, VanEck and Invesco, plus specialists including Grayscale, Bitwise and Hashdex.
Binance chief executive Richard Teng spoke for many by claiming the SEC move brings added credibility to the digital asset industry and “signals an exciting new era of adoption and legitimacy, not just for Bitcoin but also for the broader crypto space”.
Trading began last Thursday and was brisk, with $4.6 billion worth of shares traded by close of day, according to London Stock Exchange Group data.
Bitcoin soared to $48,711 on January 11, up another 15 per cent following last year’s hyper-powered 150 per cent surge. It then plunged back to about $42,000 in a classic case of “buy the rumour, sell the fact”.
Everyone knew spot Bitcoin ETFs were coming. Their arrival was priced in, as is April’s Bitcoin halving.
So much for the Bitcoin big bang. Yet, these are early days.
BlackRock claims that its iShares Bitcoin Trust (IBIT) offers investors two main advantages.
First, it allows investors to gain access to Bitcoin within a traditional broker's account. Second, it spares them the “operational burdens” associated with buying Bitcoin directly, such as “high trading costs and tax reporting complexities”.
Fund manager Ark reckons its 21Shares Bitcoin ETF (ARKB) offers investors a “tool for diversification” by allowing them to add an asset with low correlation to traditional portfolio assets.
Investors no longer have to master “arcane details of how to safely trade or store” Bitcoins, which Ark will keep in “cold storage” – secure offline environments safe from hacking and theft.
Given that a million or so Bitcoins have been lost or stolen, these are real benefits.
Charges are low, too. Ark has no initial fees and an annual management charge of 0.21 per cent. BlackRock charges slightly more at 0.25 per cent but with an initial 12-month reduction to 0.12 per cent on the first $5 billion.
What spot ETFs have not done is change Bitcoin’s speculative nature, says Laith Khalaf, head of investment analysis at UK-based fund platform AJ Bell.
He notes that in 2021, London’s Financial Conduct Authority banned the sale of exchange-traded notes offering Bitcoin exposure.
“Its argument was that crypto had no inherent value, was wildly volatile, rife with financial crime and didn’t fulfil a financial planning need. So, what’s changed? Not much.”
Sometimes you should be careful what you wish for, Mr Khalaf says.
“It’s hard to make a case that crypto fulfils a genuine financial planning need that can’t be met by other assets, but it definitely does open up investors to the possibility of very heavy losses.”
The new breed of spot Bitcoin ETFs are not available for sale in the UK and Europe, where regulators remain wary, Mr Khalaf adds.
Others are more optimistic. Lukman Otunuga, senior market analyst at online trading broker FXTM, calls the SEC move a “historic moment” that will bring in fresh inflows from retail and institutional investors.
He also rightly predicted that early price falls were likely “before investor inflows push prices higher down the road”.
Wild price fluctuations represent a huge opportunity for traders, but they will need cool heads, Mr Otunuga adds.
“They should be conscious that resistance may be around $47,000, then $50,000. Beyond this point is the all-time high just below $69,000.”
It could go the other way, too. “Should prices slip back below $37,000, this may open the doors towards $30,000 and $20,000 instead,” he cautions.
Vijay Valecha, chief investment officer at Century Financial, says Bitcoin has strong technical support around $39,000 on the downside, while warning that $48,000 still holds as a “major line of upside resistance”.
Bitcoin’s newfound respectability has done more to help smaller cryptocurrencies, with second-biggest Ether the clear winner.
While Bitcoin was trading at $42,850.09 on Tuesday morning, Ether was up almost 1 per cent at $2,532.36, driven by hopes that it will soon have a spot ETF of its own, Mr Valecha says.
“Altcoins such as XRP, Cardano, Avalanche, Polkadot, Dogecoin, Polygon, Shiba Inu and Chainlink rose between 5 per cent and 14 per cent.”
He expects more short-term volatility, but a longer-term boost as “leading institutions, including hedge funds, sovereign wealth funds and registered investment advisers” pile in.
Manuel Villegas, digital assets analyst at Julius Baer, is also accentuating the positives, citing “long-term holder accumulation, slowing miner supply growth and the upcoming block-reward halving, paired with a growing conviction that the fastest and steepest US monetary tightening cycle has ended”.
However, it will remain volatile, he warns, with a “consolidation, nevertheless, on the cards, following the steepness of the recent rally”.
Mr Villegas predicts an ETF “fee war” as fund managers slash charges to grab market share.
Giving that most spot Bitcoin ETFs do the same job, tracking the price, “fees are one of the only notable differences”.
Matthew Weller, global head of research at Forex.com and City Index, says the launch of the SPDR Gold ETF in November 2004 provides a positive parallel.
“For the first time, Americans had an easy, liquid way to invest in the precious metal and money poured in. That contributed to gold’s big rally from below $500 to nearly $2,000 over the next eight years.”
Mr Weller shrugs off the Bitcoin price pullback.
“As long as the ETFs are attracting assets, dips may be relatively limited,” he says.
Bitcoin spot ETFs have not put a rocket under cryptocurrencies and nor will the Bitcoin halving. Instead, 2024 could be a slow burner.
LIVING IN...
This article is part of a guide on where to live in the UAE. Our reporters will profile some of the country’s most desirable districts, provide an estimate of rental prices and introduce you to some of the residents who call each area home.
ABU%20DHABI'S%20KEY%20TOURISM%20GOALS%3A%20BY%20THE%20NUMBERS
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MATCH INFO
South Africa 66 (Tries: De Allende, Nkosi, Reinach (3), Gelant, Steyn, Brits, Willemse; Cons: Jantjies 8)
Canada 7 (Tries: Heaton; Cons: Nelson)
Global state-owned investor ranking by size
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China
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UAE
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Japan
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Norway
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Canada
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Singapore
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Australia
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Saudi Arabia
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South Korea
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Wonka
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Pakistan T20 series squad
Sarfraz Ahmed (captain), Fakhar Zaman, Ahmed Shahzad, Babar Azam, Shoaib Malik, Mohammed Hafeez, Imad Wasim, Shadab Khan, Mohammed Nawaz, Faheem Ashraf, Hasan Ali, Amir Yamin, Mohammed Amir (subject to fitness clearance), Rumman Raees, Usman Shinwari, Umar Amin
UAE currency: the story behind the money in your pockets
It's Monty Python's Crashing Rocket Circus
To the theme tune of the famous zany British comedy TV show, SpaceX has shown exactly what can go wrong when you try to land a rocket.
The two minute video posted on YouTube is a compilation of crashes and explosion as the company, created by billionaire Elon Musk, refined the technique of reusable space flight.
SpaceX is able to land its rockets on land once they have completed the first stage of their mission, and is able to resuse them multiple times - a first for space flight.
But as the video, How Not to Land an Orbital Rocket Booster, demonstrates, it was a case if you fail, try and try again.
COMPANY PROFILE
Name: Kumulus Water
Started: 2021
Founders: Iheb Triki and Mohamed Ali Abid
Based: Tunisia
Sector: Water technology
Number of staff: 22
Investment raised: $4 million
Most match wins on clay
Guillermo Vilas - 659
Manuel Orantes - 501
Thomas Muster - 422
Rafael Nadal - 399 *
Jose Higueras - 378
Eddie Dibbs - 370
Ilie Nastase - 338
Carlos Moya - 337
Ivan Lendl - 329
Andres Gomez - 322
Ain Dubai in numbers
126: The length in metres of the legs supporting the structure
1 football pitch: The length of each permanent spoke is longer than a professional soccer pitch
16 A380 Airbuses: The equivalent weight of the wheel rim.
9,000 tonnes: The amount of steel used to construct the project.
5 tonnes: The weight of each permanent spoke that is holding the wheel rim in place
192: The amount of cable wires used to create the wheel. They measure a distance of 2,4000km in total, the equivalent of the distance between Dubai and Cairo.
Like a Fading Shadow
Antonio Muñoz Molina
Translated from the Spanish by Camilo A. Ramirez
Tuskar Rock Press (pp. 310)
Keane on …
Liverpool’s Uefa Champions League bid: “They’re great. With the attacking force they have, for me, they’re certainly one of the favourites. You look at the teams left in it - they’re capable of scoring against anybody at any given time. Defensively they’ve been good, so I don’t see any reason why they couldn’t go on and win it.”
Mohamed Salah’s debut campaign at Anfield: “Unbelievable. He’s been phenomenal. You can name the front three, but for him on a personal level, he’s been unreal. He’s been great to watch and hopefully he can continue now until the end of the season - which I’m sure he will, because he’s been in fine form. He’s been incredible this season.”
Zlatan Ibrahimovic’s instant impact at former club LA Galaxy: “Brilliant. It’s been a great start for him and for the club. They were crying out for another big name there. They were lacking that, for the prestige of LA Galaxy. And now they have one of the finest stars. I hope they can go win something this year.”
Director: Laxman Utekar
Cast: Vicky Kaushal, Akshaye Khanna, Diana Penty, Vineet Kumar Singh, Rashmika Mandanna
Rating: 1/5
Company%20profile
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Killing of Qassem Suleimani
UAE currency: the story behind the money in your pockets
How to watch Ireland v Pakistan in UAE
When: The one-off Test starts on Friday, May 11
What time: Each day’s play is scheduled to start at 2pm UAE time.
TV: The match will be broadcast on OSN Sports Cricket HD. Subscribers to the channel can also stream the action live on OSN Play.
Killing of Qassem Suleimani
Ronaldo's record at Man Utd
Seasons 2003/04 - 2008/09
Appearances 230
Goals 115
SERIES INFO
Cricket World Cup League Two
Nepal, Oman, United States tri-series
Tribhuvan University, Kathmandu
Fixtures
Wednesday February 5, Oman v Nepal
Thursday, February 6, Oman v United States
Saturday, February 8, United States v Nepal
Sunday, February 9, Oman v Nepal
Tuesday, February 11, Oman v United States
Wednesday, February 12, United States v Nepal
Table
The top three sides advance to the 2022 World Cup Qualifier.
The bottom four sides are relegated to the 2022 World Cup playoff
1 United States 8 6 2 0 0 12 0.412
2 Scotland 8 4 3 0 1 9 0.139
3 Namibia 7 4 3 0 0 8 0.008
4 Oman 6 4 2 0 0 8 -0.139
5 UAE 7 3 3 0 1 7 -0.004
6 Nepal 0 0 0 0 0 0 0
7 PNG 8 0 8 0 0 0 -0.458
Credit Score explained
What is a credit score?
In the UAE your credit score is a number generated by the Al Etihad Credit Bureau (AECB), which represents your credit worthiness – in other words, your risk of defaulting on any debt repayments. In this country, the number is between 300 and 900. A low score indicates a higher risk of default, while a high score indicates you are a lower risk.
Why is it important?
Financial institutions will use it to decide whether or not you are a credit risk. Those with better scores may also receive preferential interest rates or terms on products such as loans, credit cards and mortgages.
How is it calculated?
The AECB collects information on your payment behaviour from banks as well as utilitiy and telecoms providers.
How can I improve my score?
By paying your bills on time and not missing any repayments, particularly your loan, credit card and mortgage payments. It is also wise to limit the number of credit card and loan applications you make and to reduce your outstanding balances.
How do I know if my score is low or high?
By checking it. Visit one of AECB’s Customer Happiness Centres with an original and valid Emirates ID, passport copy and valid email address. Liv. customers can also access the score directly from the banking app.
How much does it cost?
A credit report costs Dh100 while a report with the score included costs Dh150. Those only wanting the credit score pay Dh60. VAT is payable on top.
The specs: 2018 Dodge Durango SRT
Price, base / as tested: Dh259,000
Engine: 6.4-litre V8
Power: 475hp @ 6,000rpm
Torque: 640Nm @ 4,300rpm
Transmission: Eight-speed automatic
Fuel consumption, combined: 7.7L / 100km
The specs: Volvo XC40
Price: base / as tested: Dh185,000
Engine: 2.0-litre, turbocharged in-line four-cylinder
Gearbox: Eight-speed automatic
Power: 250hp @ 5,500rpm
Torque: 350Nm @ 1,500rpm
Fuel economy, combined: 10.4L / 100km
World record transfers
1. Kylian Mbappe - to Real Madrid in 2017/18 - €180 million (Dh770.4m - if a deal goes through)
2. Paul Pogba - to Manchester United in 2016/17 - €105m
3. Gareth Bale - to Real Madrid in 2013/14 - €101m
4. Cristiano Ronaldo - to Real Madrid in 2009/10 - €94m
5. Gonzalo Higuain - to Juventus in 2016/17 - €90m
6. Neymar - to Barcelona in 2013/14 - €88.2m
7. Romelu Lukaku - to Manchester United in 2017/18 - €84.7m
8. Luis Suarez - to Barcelona in 2014/15 - €81.72m
9. Angel di Maria - to Manchester United in 2014/15 - €75m
10. James Rodriguez - to Real Madrid in 2014/15 - €75m
Company Profile
Founder: Omar Onsi
Launched: 2018
Employees: 35
Financing stage: Seed round ($12 million)
Investors: B&Y, Phoenician Funds, M1 Group, Shorooq Partners
The specs
Engine: four-litre V6 and 3.5-litre V6 twin-turbo
Transmission: six-speed and 10-speed
Power: 271 and 409 horsepower
Torque: 385 and 650Nm
Price: from Dh229,900 to Dh355,000
