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Why Is Everybody Talking About Bitcoin?

Why Is Everybody Talking About Bitcoin?
Written by publishing team

It’s no secret that Bitcoin (CRYPTO: BTC) It is a hot commodity these days. The biggest and oldest cryptocurrency grabs the headlines, from enthusiastic analyzes of the bright future of the digital currency to skeptical compromisers focused on massive electrical power demands and uncertain value.

The widespread interest sparked the massive gains in Bitcoin prices over the past year and the change. Suppose you adjust the timing of the stock market perfectly, and you buy in Standard & Poor’s 500 Index Fund at the Bottom of the Coronavirus Crash of 2020. That investment could have doubled by now — but Bitcoin’s returns over the same period have made the stock market’s generous gains seem completely frozen by comparison:

Bitcoin price data by YCharts

And the Bitcoin chatter has moved far beyond the water cooler and the barbershop. Nowadays, you will find leaders of popular companies taking cryptocurrencies very seriously, often discussing Bitcoin and its peers in their earnings calls. Some of the things they say are quite surprising – and the best ideas don’t always come from the usual suspects. Here is a collection of the most attractive Bitcoin comments I found on recent earnings season earnings calls.

Jack Dorsey supports the Bitcoin network in many ways

Let’s start with a fairly straightforward Bitcoin bull. Twitter (NYSE: TWTR) And Square (NYSE: SQ) CEO Jack Dorsey is a longtime crypto enthusiast, so it doesn’t shock them when he spends a lot of his conference call explaining how his companies use cryptocurrency.

In a Square third-quarter call at the beginning of November, Dorsey outlined the digital payment company’s recent launch of a Bitcoin mining platform and Bitcoin hardware wallet for consumers. The idea is to enhance Bitcoin’s exposure to the general public.

“Our focus is on helping bitcoin become the original currency of the internet,” Dorsey said. “So we have a number of initiatives in place to achieve that goal.”

One week ago, Dorsey poeticized Twitter’s microblogging service, where Bitcoin-based advice offers Twitter creators unique advantages over traditional monetary contributions.

“What makes Bitcoin interesting is that it is globally accessible, no matter where in the world you are. If you have a Bitcoin address to receive and you have Bitcoin to specifically send via [high-speed Bitcoin transfer feature] “Lightning Network, you can do it,” he said on his Twitter Q3 call. “We can get involved, rather than having to go market by market and look for services that work with a bank within each one of those [markets]So it gives us more speed.”

In other words, Jack Dorsey sees the Bitcoin network as a valuable digital payment system with real value and useful applications. He is doing what he can to promote this view, and also to build more use cases for Bitcoin payments. Twitter and Square give him two completely different platforms on which he can pursue this vision of everyday Bitcoin payments.

Two people sitting next to each other looking at a laptop.

Image source: Getty Images.

Al Kelly builds digital partnerships

In a fourth-quarter call in late October, Visa (NYSE: V) CEO Al Kelly highlighted how crypto support is helping the credit card giant to form new partnerships:

Whether it’s leveraging account data for value-added services, facilitating the movement of funds from account to account, or paying by bank, Open Banking creates opportunities for Visa to offer our customers and partners a one-stop shop for money transfer, security, data, and valuable customer experiences. Blockchains will also continue to expand our network of networks. Our leveling capabilities and continuous innovation around crypto-specific APIs and services have been key to winning new partnerships. We have approximately 60 crypto platform partners with the ability to issue Visa credentials, and we already raised over $3.5 billion in payment volume in fiscal year 21.

That’s $3.5 billion out of $165 billion in transactions processed for fiscal year 2021. Visa can rely more on the blockchain-based payment space before unexplored growth opportunities run out. Currently, the company is happy to help its credit card issuer partners launch Visa cards linked to Bitcoin and other digital assets. Most of the company’s cryptocurrency payments process passes through international borders, fulfilling an unfilled need for fast and inexpensive international money transfers.

The Bitcoin metal symbol stands on a large red question mark dot.

Image source: Getty Images.

Chuck MacFarlane Sees Opportunity in Bitcoin Mining Deals

Here’s a different view. In the third quarter, a Minnesota-based energy company otter tail (NASDAQ: OTTR) I secured a large scale energy contract with a privately owned crypto-mining specialist. Otter Tail CEO Chuck MacFarlane celebrates Bitcoin and Ethereum (CRYPTO: ETH) Mining agreement in third-quarter earnings call on November 2.

“Demand from client facilities can approach 100MW with a high load factor and capacity [lower their power draw as necessary]”We expect this download to be fully online by the end of the first quarter of 2022,” MacFarlane said.

The digital mining deal is made possible by the lower tariff rates in the North Dakota market of Otter Tail. MacFarlane said that the blockchain implementation is a “low-margin client,” even under these favorable conditions, but the slim margins still lead to meaningful returns and operating profits thanks to the massive power requirements of a crypto miner.

MacFarlane would be happy to get more bitcoin mining contracts like this one, if other opportunities materialize. Political pressure may lead to more bitcoin business. Applied Blockchain originally planned to operate mining facilities in China, but had to move elsewhere when regulators in Beijing cracked down on bitcoin miners over the summer. Many other miners in China are certainly looking for low-cost energy deals on US soil as well.

This article represents the opinion of the author, who may disagree with the “official” recommendation position of the Motley Fool Premium Consulting Service. We are diverse! Asking about an investment thesis — even if it’s our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.

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