A lot of people wondered in the past weeks whether or not it was the end for Bitcoin. After suffering from a significant plunge days after the digital currency experienced its highest value, many are asking if it was really a bubble after all.
Over the last few weeks, Bitcoin struggled to even get to $14,000. And it could be a number of things that have led to this. In 2017, Bitcoin experienced a 1,500% jump. But after series of announcements to regulate exchanges in Asia including China and South Korea, a lot of people thought that Bitcoin hype was actually over.
But Bitcoin price surged back to $14,900 on Tuesday after Wall Street Journal reported that Peter Thiel, a Silicon Valley investor, amassed hundreds of millions worth of Bitcoin. According to the report, around $15 to $20 million worth of Bitcoin was made by the Thiel-backed venture capital firm Founders Fund.
Founders Firm and Bitcoin Going Mainstream
What makes this investment crucial for Bitcoin? Peter Thiel was an early investor of Facebook. He is also the co-founder of PayPal. Until today, Thiel-backed Founders Firm is the most mainstream investor that Bitcoin has. It is speculated that Thiel’s company may have acquired Bitcoin late 2016 or early 2017 right before the bullish trend in the latter half of 2017.
This simply means that Bitcoin is in the same investment portfolio as startups and popular companies that we have currently today including Facebook, Airbnb, SpaceX, and Lyft. In a report made by Wall Street Journal, it was added that the decision to invest in Bitcoin is a decision made personally by Thiel. And what made them go for Bitcoin? The firm is hoping that it can help fund a large number of high-risk startups in the future.
Is Founders Firm the largest holders of Bitcoin to date? It is Tyler and Cameron Winklevoss who made the largest investment to Bitcoin. These tech entrepreneur twins made a smaller investment of around $11 million four years ago to the cryptocurrency. This means that it was only worth $120 during that time. They are believed to be the very first Bitcoin billionaires.
How Does It Affect Bitcoin’s Future?
Bitcoin and cryptocurrencies have become popular especially during the last months of 2017. There are already two exchanges that have launched Bitcoin futures contracts last December. In addition to this, Goldman Sachs is also reportedly looking closely at having their own cryptocurrency trading desk.
Now that Peter Thiel entered the picture, does it mean that Bitcoin is going to be back to its bullish trend in the beginning of 2018? Are we seeing a possibility of Bitcoin regaining its all-time high soon? Or does it only mean that Thiel’s big bet on Bitcoin just slowed down the Bitcoin bubble?
With Thiel’s Bitcoin investment, the digital currency gained much-needed support especially after series of drop in its value over the last weeks. However, we will have to wait and see how things are going to unfold in the coming weeks whether this announcement will spike the interest of many investors to head towards Bitcoin.
