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Bitcoin skeptics often argue that the top cryptocurrency is similar to the fiat monetary system in the sense that it isn't backed by anything.

However, the article by Unchained Capital's Parker Lewis states that bitcoin is backed by the only thing that backs any form of money: the credibility of its monetary properties.

To start with, bitcoin is finitely scarce and more easily transferable than incumbent competitors. It is also more decentralized and resistant to censorship or corruption. Further, its supply is fixed - there will only ever be 21 million bitcoin.

The cryptocurrency is divisible to eight decimal points (1 one-hundred millionth) and the value can be transferred to anyone and anywhere in the world on a permissionless basis, and final settlement does not rely on any third-party.

Put simply, its monetary properties appear vastly superior to the fiat money used today.

The article concludes by stating that central banks will be forced to expand the monetary base in order to sustain the legacy system, making bitcoin look attractive as a viable alternative.

Back Into Five Figures

BTC: Price: $10,150 | Market cap: $184 billion | 24-Hr Volume: $47 billion

Trend: Bullish

Bitcoin has crossed into five figures with conviction, validating the long-term bullish shift in the sentiment highlighted by the golden crossover on the daily chart.

Additionally, Tuesday's strong bounce from the ascending trendline support confirmed another bullish higher low at $9,467 (Feb. 17 low) and strengthened the case for a continuation of the rally from January lows near $6,850.

With the bulls back in the driver’s seat, a re-test of the recent high of $10,500 looks likely, more so, as the price of gold, a classic safe haven asset, is again rising.

The yellow metal jumped 1.32 percent on Tuesday – its biggest single-day gain since Jan. 3 – on haven demand amid losses in the U.S. stock markets and is currently trading above $1,600 per ounce. Technical charts show it could revisit the six-year high of $1,611 reached on Jan. 8.

Bitcoin has increasingly moved in tandem with gold this year. Its one-month correlation with gold strengthened to 0.70 in January from December’s -0.12, according to cryptocurrency exchange Kraken’s January volatility report.

Read Analysis

In this feature of the Markets Daily newsletter, we aggregate news, reports, ideas and tweets relevant to crypto traders and investors.

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The U.S. Is Very Worried About Bitcoin—And It’s Finally Doing Something About It (Forbes)
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Disclaimer: The information presented in this message is intended as a news item that provides a brief summary of various events and developments that affect, or that might in the future affect, the value of one or more of the cryptocurrencies described above. The information contained in this message, and any information liked through the items contained herein, is not intended to provide sufficient information to form the basis for an investment decision. The information presented herein is accurate only as of its date, and it was not prepared by a research analyst or other investment professional. You should seek additional information regarding the merits and risks of investing in any cryptocurrency before deciding to purchase or sell any such instruments.

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