As bitcoin, ethereum and other cryptocurrencies get increasing attention from investors, Wall Street and its traditional banks continue to adjust to the shift. Catch up on this week's top stories highlighting the intersection of these old guard and new school areas of finance with this recap compiled by The Fly.
1. SQUARE REPORTS BITCOIN TRADING REVENUE: Square (SQ) reported earnings for its third quarter on Wednesday and revealed that the company generated $43M in revenue from cryptocurrency in Q3. The report comes after the company launched bitcoin trading through its Cash App in January. “We do see people use the Cash App fundamentally as you would expect them to use a bank account,” Chief Executive Officer Jack Dorsey said.
2. CRYPTO HEADWINDS: On Thursday, Morgan Stanley analyst Joseph Moore said the end of the crypto-related shortage has caused headwinds in gaming for Nvidia (NVDA), particularly at the low end of the market. He also sees headwinds from weaker end demand in China due to regulatory issues and from delayed take-up of what he still expects "will be a very exciting product cycle" for the Turing family. Given all of this, he said it was "prudent" to lower his estimates going into Nvidia's earnings report. Moore lowered his price target on Nvidia shares to $260 from $273, but kept an Overweight rating on the stock.
3. OVERSTOCK CEO SEES MASS ADOPTION FOR CRYPTO: On Monday, Overstock (OSTK) CEO Patrick Byrne told YouTuber Naomi Brockwell he is still expecting mass adoption of cryptocurrency. "When people start getting into it is when their own financial systems collapse,” said Byrne. “Given that I think the entire modern financial system is a big Keynesian, magic money tree Ponzi scheme, I do expect that the day will come when people turn to crypto...Whether bitcoin is the one, whether bitcoin has solved its speed problems or it’s another cryptocurrency, only time will tell.”
4. MIDTERM ELECTIONS: Bitcoin prices moved higher on Wednesday following the U.S. midterm elections as voters elected Jared Polis as governor of Colorado and Gavin Newsom as governor of California, MarketWatch reported. Polis, a Democrat, has long campaigned for decentralized technology to help local business. “As governor, I will ensure that Colorado explores the potential use of blockchain technology and works alongside the business community, policy experts, local communities, and Coloradans to build a robust economy for the future,” he previously wrote. Newsom, also a Democrat, was one of the first politicians to accept donations in bitcoin back in 2014.
5. DPW TO SIMPLIFY STRUCTURE: On Tuesday, DPW Holdings (DPW) announced that its board of directors approved a proposed reorganization of its corporate structure. DPW Holdings will acquire, grow and spin off companies in two separate groups: DPW Technology Group and DPW Financial Group. DPW will own 100% of these two groups and anticipates beginning accounting for them separately in 2019. DPW Technology Group will focus on advanced technology, design, power solutions and manufacturing businesses in defense, aerospace, telecom, medical, and textiles. DPW Financial Group will focus on lending, cryptocurrency mining, hospitality, and real estate.
CRYPTO STOCK PLAYS: Cryptocurrency revenues have been pointed to as reasons to be bullish on Advanced Micro Devices (AMD) and Nvidia in select research. Overstock, DPW Holdings, Kodak (KODK), Ideanomics (SSC), Riot Blockchain (RIOT), Pareteum (TEUM) and Social Reality (SRAX) are other stocks that have been touted, or promoted themselves, as a way to play the crypto theme.
PRICE ACTION: As of time of writing, bitcoin was roughly flat this week at $6,362 in U.S. dollars, according to CoinDesk.
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Bitcoin
+ (+0.00%)
Bitcoin
+ (+0.00%)
Block
-3.22 (-4.28%)
Nvidia
-1.89 (-0.92%)
OSTK
+
Ault Global Holdings
-0.0136 (-4.62%)
AMD
-1.01 (-4.76%)
Eastman Kodak
-0.19 (-5.96%)
Ideanomics
-0.05 (-1.50%)
Riot Platforms
+ (+0.00%)
Pareteum
-0.11 (-4.68%)
Srax
-0.02 (-0.78%)