An interesting feature of cryptocurrencies is that their value swings extremely subject to speculation. Thus, whenever the market gets flooded with positive news ranging from hedge fund managers predicting a whopping future value of these digital assets or crypto experts betting on the same, the price of these virtual tokens skyrocket.
After ending 2017 with dampened spirits, the new year seems to be paving a warm welcome path for bitcoin following Wall Street Journal stating that venture capital firm Founders Fund co-founded by Peter Thiel had made a lump sum investment of $15 to $20 million in Bitcoin which added impetus to the rising price graph of the same. This investment had yielded multi million dollars as stated by the fund officials to its investors courtesy the dramatic rise of bitcoin in the fourth quarter of the last fiscal.
From the beginning of 2017 when bitcoin was being traded around $1000, it has undergone a stratospheric rise to almost $20,000 which was its trading value at the fag end of 2017. The exact reason behind this investment decision of Founders Fund is unclear. When asked to comment on the same, they declined to make any statements.
The bitcoin investments of Founders Fund are spread across various hubs of the firm’s funds including one launched in the middle of 2017 as per Wall Street Journal. According to the newspaper report, there does not exist any notable clue hinting at whether the investments of the firm have been sold off. Irrespective of growing popularity and hype concerning the same, various mainstream institutions have taken the risky path of bitcoin investment to benefit from its pricing volatility which has paved numerous rags to riches story till date. It takes just a matter of hours for this dynamic cryptocurrency to report double digit growth percentage. The crypto market also responded graciously to this press release causing its price to report a 12% hike to $ 15,098.57 from an opening range of $13,509.87 on Tuesday. With the climbing price of Bitcoin, futures trading in CBOE was momentarily stalled in accordance with its pre-determined rules.
Thiel had previously compared virtual currencies with the yellow metal and said that people are “underestimating” it’s true potential. He was quoted as saying that, “If bitcoin ends up being the cyber-equivalent of gold it has a great potential left.” Tim Draper, a renowned Venture capitalist purchased about 30000 bitcoins during a 2014 U.S. Marshals Service auction and confirmed his entire holding till date during an early December interview with CNBC.
Also Read: Paypal Co-Founder, Peter Thiel Supports Bitcoin
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Tarunima Ghosh Laha is a Finance Post Grad from St. Xaviers who believes Finance is more than just Balance Sheets and Ledger creation. This filmy bookworm who believes she was a sloth in past life also nourishes a penchant of owning a private zoo someday. Equipped with a laptop and online Lexicon she is all set to give finance a glamorous makeover in the form of exciting writeups with bang on info and flashy new words.
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