[Bitcoin Now] Amid Coinbase Listing Celebration... Powell Says "Cryptocurrency Is Speculative"

Bitcoin Stagnates Around 80 Million Won

On the 14th, the Bitcoin price is displayed on the status board at Bithumb Gangnam Center in Gangnam-gu, Seoul. [Image source=Yonhap News]

[Asia Economy Reporter Gong Byung-sun] The leading cryptocurrency Bitcoin is hovering around the 80 million KRW mark. Although Coinbase, the largest cryptocurrency exchange in the U.S., successfully went public on Nasdaq, this appears to be influenced by Federal Reserve Chairman Jerome Powell’s view of cryptocurrencies as speculative instruments.

According to the domestic cryptocurrency exchange Upbit, as of 1:49 PM on the 15th, Bitcoin was recorded at 79.66 million KRW, down 0.91% from the previous day. After rising 3.27% in one day on the 13th and surpassing 80 million KRW, it has been fluctuating slightly around the 80 million KRW level.

On the 14th (local time), Coinbase successfully listed on Nasdaq. The opening price of Coinbase was set at $381, exceeding the pre-market reference price of $250 (approximately 270,000 KRW) set by Nasdaq. During the session, it rose as high as $429.54, reflecting investors’ expectations for the cryptocurrency market. According to U.S. economic media Bloomberg, Ben Weiss, CEO of CoinFlip, a cryptocurrency deposit and withdrawal management company, evaluated that “Coinbase’s listing means the cryptocurrency market has entered the institutional realm.”

However, the cryptocurrency market did not continue its upward trend due to Chairman Powell’s negative remarks about cryptocurrencies. According to U.S. economic media CNBC on the 14th, Powell said at a conference hosted by the Washington Economic Club, “Cryptocurrencies are merely speculative instruments and are not actively used as a means of payment,” adding, “For thousands of years, people have assigned special value to gold without actually possessing it, and Bitcoin is similar to this.” After Powell’s remarks, Coinbase’s stock price closed at $328.28, about 24% lower than its peak.

There are also concerns that Coinbase’s stock price could be shaken if the government moves to regulate the market. On the 14th, Bloomberg mentioned that last month Coinbase paid a $6.5 million fine to the U.S. Commodity Futures Trading Commission for allegations of wash trading, explaining that additional regulations might be possible. Wash trading refers to the practice of inflating trading volume by buying and selling between the same investor or within the same investment firm.

Meanwhile, opinions have been raised that the cryptocurrency market is still in its early stages. On the 14th, Mike Novogratz, CEO of cryptocurrency investment firm Galaxy Digital, said in an interview with CNBC, “The current total market capitalization of the entire cryptocurrency market is about $2 trillion, which is only about 1% of global assets,” adding, “It is expected to increase to 2-3% within the next 2-3 years.” Earlier, on the 1st, CEO Novogratz claimed that Bitcoin would surpass gold’s market capitalization.