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Bitcoin hits all-time-high of $29,000 as price surge continues

Yahoo Finance’s Dan Roberts joins Julie Hyman and Myles Udland to talk bitcoin, as the cryptocurrency keeps hitting new records, topping $29,000 on December 31.

Video Transcript

JULIE HYMAN: Let's get to one of the other big topics, the hot assets that we have been watching this year. Bitcoin, of course, has been near the top of the list. We have seen the cryptocurrency, what, just about quadruple in 2020.

Our Dan Roberts tracks Bitcoin and the other cryptocurrencies. Although, Bitcoin really is the one that we talk about these days, Dan. And so I wanted to kind of ask you for your thoughts here as we close out the year. And we did not, obviously, see a late-year crash like we did in 2017. Bitcoin has kept right on going.

DAN ROBERTS: Yeah, Julia, it's hard not to think that all of the factors are converging right now for Bitcoin's argument, both as an investment and even really as a technology. Now that's not to say people are spending it. And, in fact, for a long time, the argument that kind of mainstream investors would make against it is, well, it's not really a currency. You can't buy anything with it. No one is using it as a currency.

Well, that's correct. The appeal right now is as an investment. That said, you know, Paypal planning to add Bitcoin buying and spending with Bitcoin is an interesting one. Of course, as the price goes up, I don't think people are going to want to spend their Bitcoin. But PayPal and Square getting in was really big.

As well, you had a lot of mainstream, real estate-- Wall Street investors, I should say, you know, hedge fund names kind of changing their tune this year. All of those sort of narratives converged. I mean, when we did this three years ago in 2017, it was a little bit more frenzied, a little bit more, you know, what's the argument here, people kind of confused, people talking about it around the Thanksgiving dinner table. That was the joke. Should I buy some? The price hike was so crazy and then the big crash in about February 2018.

It hasn't happened this time. And I think that, arguably, it's because of a few things, right? First of all, there was an interesting report. Jared Blikre and I were tweeting about this yesterday, but a report that the supply of Bitcoin in circulation is much smaller these days. That is a small number of whales and firms old-- own, hold a large percentage of the Bitcoin, and they aren't selling it. And, as a result, you know, that makes the amount that's actually in circulation, selling right now, more scarce and more appealing.

Of course, that could cause more price volatility, but, arguably, it should make it even more appealing and cause the price to continue to go up. That's not to say there won't be continued price corrections, but it is hard to see a dramatic crash happening again.

Of course, no one knows what's going to happen, right? I mean, I always tell people, when they're asking me about the Bitcoin price, don't believe anyone who says that they know for sure what is going to happen with the price, but, again, a lot of narratives converging and a lot kind of going right.

The other thing I should make sure to mention is, you know, the argument that what governments have been doing amid the pandemic strengthens Bitcoin's appeal as an investment, as a store of value, as a hedge. You know, any time there's kind of mainstream uncertainty and any time you have governments printing money and giving stimulus checks, the argument is that that makes Bitcoin more appealing since it has scarcity, since it's digital gold.

So, you know, I think you might see the price continue to rise. Anyone can throw a dart at the board and try and predict what the price is going to do in 2021, but this late 2020 surge is remarkable. I mean, think about it this way. Bitcoin took 10 years in existence to get to $20,000 on December 15. Now, it has gotten to $29,000 in two weeks.

MYLES UDLAND: Dan, what about the other coins, particularly Ether, Litecoin? They're kind of the two, I guess, most credible altcoins, and they're probably not even altcoins at this point. But, you know, really 2017 was defined not only by Bitcoin, but Dogecoin, Dentacoin, Monero, all of this other crap, basically, that kind of came up in the space.

Where are we at with that? Because, you know, when Jared pulls up that heat map, Bitcoin is just way bigger. And that tracks everything by market cap, right? Bitcoin is just the giant in this space, and it seems like we're not wasting our time here talking about Stellar Lumens and all that kind of stuff.

DAN ROBERTS: That's right. And, you know, I do think, to be fair, you know, Ether is still kind of seen as the number two to Bitcoin. And I mean that in a positive way. And you still have a lot of people who try and say, well, Ethereum-- that is the blockchain, the Ethereum blockchain-- is the one that has bigger potential for creating decentralized apps and bigger business application long term than the Bitcoin blockchain.

Now I don't necessarily buy that because, in the last few years, the biggest story about Ethereum was the network being clogged down by a very popular game. Remember CryptoKitties? Of course, you know, people argue that Ethereum has strengthened since then.

And, since we're talking about price here-- that's our real interest-- you know, Ether has really risen huge in 2020 as well. But, that said, I do think that Bitcoin-- if you want to throw in Ether, fine-- they have sort of distinguished and differentiated themselves more than ever from the other coins, from the other altcoins.

You know, boy, we could do a whole separate segment on XRP or Ripple, which, of course, we've all read about the problems happening there because Ripple, the company that created XRP, is now involved in a lawsuit with the SEC. So Coinbase and other big exchanges are suspending trading in XRP, XRP, one of the top five cryptocurrencies by market cap.

So they all kind of have their different some would say appeals. Some would say problems. The companies and systems behind each coin would say use cases, but really I kind of think there's Bitcoin, and then there's Ether, and then there's everything else. And I think you're right that, for the most part, mainstream kind of finance and business media is paying less attention than before to those altcoins or, as some people call them, the word that rhymes with Bitcoin, but starts with an S-H. Right, Myles?

JULIE HYMAN: Indeed, we won't-- we won't say that here today, though, Dan Roberts. And, of course, we didn't even talk about Coinbase going public, possibly, next year, as it intends to do at least, but we'll save that for 2021. Happy New Year, Dan. Thanks for chatting Bitcoin with us.

DAN ROBERTS: Happy New Year.