MicroStrategy Making Gains; Iran Turns To Crypto; PayPal Crypto Launches (Sort Of)
This week, MicroStrategy is swimming in gains, Iran is embracing cryptocurrency in the face of sanctions, and PayPal’s cryptocurrency service has already rolled out to some users. More Info @ Talk.Bitcoin.Tax Full Show Notes: (00:27) As you probably have heard if you are a frequent listener of this podcast, many companies are investing in Bitcoin in a big way. Back in August, the largest independent publicly-traded business intelligence company Microstrategy purchased 21,454 BTC at an aggregate purchase price of $250 million dollars. Shortly after the initial investment, they purchased an additional $175 million dollars’ worth of BTC. These purchases were stated to be part of a capital allocation strategy to invest in alternate investments or assets to maximize long-term value for shareholders. With the recent price increase of BTC, which is currently floating around $13,500, their strategy is already paying off. Coinfomania reports that “MicroStrategy’s 38,250 BTC haul acquired at an average price of $11,111.11 is now worth $525.5 million. That represents a $100 million gain within the space of two months.” That’s a lot of profits - so much profit, in fact, that it reportedly dwarfed three and a half years of earnings for the company. Of course, crypto can be volatile, which any investor of this size understands – but the amount of gains in such a short period of time is certainly going to be attracting other large companies to invest in a similar fashion. (1:42) Companies aren’t the only entity investing in cryptocurrency, as we have seen with many countries and talks of centralized currencies throughout the world. Iran, a country currently hit with heavy US sanctions, has recently amended legislation that would allow cryptocurrencies to fund imports. Last year, Iran legalized cryptocurrency mining, but prohibited cryptocurrency trading. According to a Decrypt report, “The edict, put forth by the Ministry of Energy and Central Bank of Iran (CBI), requires the country’s legally registered cryptocurrency miners to sell the tokens they mine to CBI. However, the country has yet to announce the rates at which it will compensate miners.” There are certainly political implications here, which may or may not overshadow the role this plays in global cryptocurrency adoption. Something like this will almost inevitably play a role in how the rest of the world embraces, treats, and legislates cryptocurrency. (02:32) Finally, an update to last week’s story about PayPal getting involved in cryptocurrency services. If you missed it, last week PayPal revealed that they would let users buy, sell, and use crypto for purchases. PayPal stated that the services would be rolling out soon, and there have already been reports of users buying multiple cryptocurrencies through PayPal. A Reddit user posted a screenshot showing off the mobile interface, exclaiming that the process was “1000x easier than any other crypto purchase I’ve made and with zero fees”. The user has some Bitcoin, Litecoin, and Ethereum in his account. Reportedly, users who signed up for early access are able to utilize the PayPal crypto services starting today, although it’s certainly not yet been made available to all users. Regarding the fee structure, it looks like the no-fee buying and selling is temporary, as PayPal’s own fee page lists a flat rate of .50 USD for any sale or purchase under $24.99, and then a percentage based fee between 1.5% and 2.3% for amounts above $25. As discussed in the original story, the reception to PayPal getting into the crypto game has been consistently mixed. Many see it as a huge step for adoption, while others see it an impediment to cryptocurrency users actually owning their own crypto. Certainly, it’s possible to view it both ways – as with most things in life, not everything should be viewed as simply black or white, good or bad. That’s it for this week’s episode of The Cryptocurrency Informer. Don’t forget – if you