Bitcoin tops $60,000, a six-month high, on U.S. ETF expectations

October 15th, 2021

By Tom Wilson, Alun John and Gertrude Chavez-Dreyfuss

LONDON/NEW YORK/HONG KONG (Reuters) – Bitcoin topped $60,000 for the first time in six months on Friday, nearing its all-time high, as hopes grew that U.S. regulators would allow a futures-based exchange-traded fund (ETF), a move likely to open the path to wider investment in digital assets.

Cryptocurrency investors have been waiting for approval of the first U.S. ETF for bitcoin, with bets on such a move fuelling its recent rally.

The world’s biggest cryptocurrency rose to $61,869.05, its highest since mid-April, and was last up 6.9% at $61,346. It has risen by more than half since Sept. 20 and is closing in on its record high of $64,895 hit in April.

The U.S. Securities and Exchange Commission (SEC) is set to allow the first American bitcoin futures ETF to begin trading next week, Bloomberg News reported on Thursday. Such a move would open a new path for investors to gain exposure to the emerging asset, according to traders and analysts.

“Crypto ETFs are inevitable. A product like this will eventually come to fruition since there is a demand for it,” said Chris Kline, chief operating officer and co-founder of Bitcoin IRA.

“It seems clear that regulators will approve some version of a crypto ETF soon, most likely by Monday,” Kline added. “As regulators become more familiar with the space, the SEC is starting to understand how these assets are stored, secured and reconciled so that it makes sense in traditional finance.”

Bitcoin’s moves on Friday were spurred by a Twitter post from the SEC’s investor education office urging investors to weigh risks and benefits of investing in funds that hold bitcoin futures contracts, said Ben Caselin of Asia-based crypto exchange AAX.

Bitcoin on the rise

Several fund managers, including the VanEck Bitcoin Trust, ProShares, Invesco, Valkyrie and Galaxy Digital Funds, have applied to launch bitcoin ETFs in the United States.

The Nasdaq on Friday approved the listing of the Valkyrie Bitcoin Strategy ETF.

After months of back-and-forth between the SEC and potential bitcoin futures ETF issuers, the regulator appears prepared to greenlight a handful of filings that will open the door to wider access to cryptocurrencies to retail and institutional investors alike.

Under the rule sets used by the ETF issuers, the SEC does not have to give explicit approval to the ETFs, which can be launched at the end of a 75-day period if the U.S. regulator has no objections.

The 75-day time period for the ProShares Bitcoin Strategy ETF ends on Monday, and the ETF can be launched on Tuesday.

The SEC declined to comment.

Crypto ETFs have launched this year in Canada and Europe, growing in popularity amid surging interest in digital assets.

Futures exchange operator Cboe Global Markets Inc applied for a rule change with the SEC that would allow it to list certain complex ETFs. The SEC approved that application on Oct. 1.

SEC Chair Gary Gensler has previously said the crypto market involves many tokens that may be unregistered securities and leaves prices open to manipulation and millions of investors vulnerable to risks.

Citing people familiar with the matter, the Bloomberg report said proposals by ProShares and Invesco, based on futures contracts, were filed under mutual fund rules that Gensler has said provide “significant investor protections”.

“It’s one of the final frontiers for mandate access,” said Joseph Edwards, head of research at crypto broker Enigma Securities. “Plenty of Americans in particular have strings attached to how they deploy a lot of their wealth. It allows bitcoin to get in on the sorts of windfall that keep U.S. equities as consistently strong as they are.”

(Reporting by Tom Wilson in London, Alun John in Hong Kong, Gertrude Chavez-Dreyfuss and John McCrank in New York; Medha Singh, Mrinmay Dey, Shubham Kalia in Bengaluru; Editing by Alexander Smith, Jason Neely, Will Dunham and Jonathan Oatis)

Brought to you by

Wall St ends higher as Goldman rounds out parade of strong bank results

October 15th, 2021

By Caroline Valetkevitch

NEW YORK (Reuters) – U.S. stocks ended higher on Friday after Goldman Sachs became the latest big bank to report strong quarterly earnings, and Wall Street’s three major indexes posted gains for the week.

Goldman Sachs Group shares jumped, giving the Dow its biggest boost, as a record wave of dealmaking activity drove a surge in the bank’s quarterly profit.

Other big lenders also rose and were among the biggest positive for the S&P 500. The index’s bank index ended sharply higher.

Results from the big financial institutions this week have provided a strong start to third-quarter U.S. earnings, though investors will still watch in coming weeks for signs of impacts from supply chain disruptions and higher costs, especially for energy.

Forecasts now call for S&P 500 earnings to show a 32% rise in the third quarter from a year ago. The latest forecast, based on results from 41 of the S&P 500 companies and estimates for the rest, is up from 29.4% at the start of October, according to IBES data from Refinitiv.

“We’re starting to get into an earnings-driven rally here that I hope lasts. We’ll really see the results in the next couple of weeks as a great bulk of companies in all sectors report,” said Peter Tuz, president of Chase Investment Counsel in Charlottesville, Virginia.

Alcoa Corp shares surged after the aluminum producer reported stronger-than-expected results, announced a $500 million buyback program and initiated a quarterly cash dividend.

According to preliminary data, the S&P 500 gained 33.35 points, or 0.75%, to end at 4,471.61 points, while the Nasdaq Composite gained 73.55 points, or 0.50%, to 14,896.98. The Dow Jones Industrial Average rose 384.83 points, or 1.10%, to 35,297.39.

The U.S. Commerce Department reported a surprise rise in retail sales in September, although investors still worried that supply constraints could disrupt the holiday shopping season. A preliminary reading for consumer sentiment in October came in slightly below expectations.

Some airline and other travel-related company shares edged higher, with the White House announcing it will lift travel restrictions for fully-vaccinated foreign nationals effective Nov. 8.

Moderna Inc shares were lower. A Wall Street Journal report, citing people familiar with the matter, said the U.S. Food and Drug Administration is delaying its decision on authorizing Moderna’s COVID-19 vaccine for adolescents to check if the shot could increase the risk of heart inflammation.

On Thursday, an FDA panel voted to recommend booster shots of its COVID-19 vaccine for Americans aged 65 and older and high-risk people.

Shares of cryptocurrency and blockchain-related firms including Riot Blockchain gained as bitcoin hit $60,000 for the first time since April.

(Additional reporting by Devik Jain in Bengaluru and Federica Urso in Gdansk; Editing by Anil D’Silva, Arun Koyyur and Nick Zieminski)

Brought to you by

German couple take refuge on boat as volcano threatens their Spanish home

October 15th, 2021

By Bart Biesemans

LA PALMA (Reuters) -Juergen Doelz and his girlfriend Jacqueline Rehm were in the process of selling their small sailboat on the Spanish island of La Palma when the Cumbre Vieja volcano erupted, forcing them to flee their dream home and move to the boat.

Doelz, 66, and Rehm, 49, who are from Germany, had been trying to sell the boat to save money after she lost her job at a car rental company due to the coronavirus pandemic.

On Sept. 19, when the volcano starting spewing red-hot lava just 4 km (2-1/2 miles) from their home in Todoque, the couple had just returned from a trip with a potential buyer. But the sale fell through as the yacht was “not sporty enough”, Doelz told Reuters on the boat, moored in Tazacorte port.

A few hours later, they were ordered to evacuate their rented house with its vineyard and terrace with a sea view and had to leave behind most of their belongings.

“Luckily we still had the boat. … And since then we have been living on this boat. It’s small, but it’s OK,” said Doelz, who is retired.

A new vent spewed gas at the southeastern side of the main vent on Friday, said the Canary Islands Volcanology Institute.

“What the volcano is leaving behind is a desolate scene for many families, for the island in general because it has a very direct impact on the island’s economy. If strong action is not taken people will have a bad time,” Civil Guard officer Raul Campillo told Reuters.

Streams of lava have laid waste to more than 600 hectares (1,480 acres) of land and destroyed about 1,600 buildings on La Palma. About 6,000 people have been evacuated from their homes on the island, which has about 83,000 inhabitants.

“We moved here (La Palma) two and a half years ago and after half a year we found our dream house. … To lose that after two years, it’s hard,” Doelz said.

Although the lava has not yet engulfed their home they believe it’s just a matter of time after the flow destroyed their Swiss neighbours’ place and as the eruption is showing no signs of abating.

“We’ll stay on the boat as long as we don’t know what to do next. Shall we stay here or shall we maybe go to another island, like Tenerife? No idea, I don’t know. It’s written in the stars,” Rehm explained.

(Aditional reporting by Graham Keeley, Emma Pinedo and Jesus Aguado, writing by Emma Pinedo, editing by Andrei Khalip, Jane Merriman and Jonathan Oatis)

Brought to you by