Another day. Another record for bitcoin. The most widely used digital currency will now cost you about US$6 125 apiece after blowing past the $5 000 and $6 000 price levels for the first time earlier this month. Bitcoin’s total value is just over $100bn, meaning it makes up more than half of the overall cryptocurrency market.
Cryptocurrency prices have been unfazed by recent regulatory crackdowns across the world and scepticism from Wall Street stalwarts including Warren Buffett and JPMorgan Chase & Co CEO Jamie Dimon. More than $3bn has poured into initial coin offerings this year despite warnings from the US Securities and Exchange Commission and other government watchdogs.
The price of ether, the second most valuable virtual coin, has climbed 8% in the past week, eclipsing bitcoin’s 4.8% gain during the same period, according to Coinmarketcap.com. That comes amid cautious comments from Advanced Micro Devices, a company that makes hardware for mining ether.
“In terms of the headwinds, we have the semi-custom seasonality and we’re also predicting that there will be some levelling-off of some of the cryptocurrency demand,” AMD CEO Lisa Su said last week on the company’s third quarter earnings call.
Morgan Stanley downgraded the stock on Monday, citing the likelihood of a significant slowdown in graphics chip sales to cryptocurrency miners.
“We believe that the cryptocurrency mining demand should fade in the coming quarters, similar to what AMD indicated on its conference call,” Morgan Stanley analyst Joseph Moore wrote in a note to clients. “We think this creates a large hole for the company next year.” — Reported by Lily Katz, (c) 2017 Bloomberg LP