Bitcoin News April 2021: Bitcoin correction, Nexon buys Bitcoin, Binance Stock Tokens and more!
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In April there was the first major correction of the Bitcoin price of around 27% after the Bitcoin price had put a green monthly candle down for 6 months.
Is this the end of the bull market, or was it just a healthy correction that was long overdue?
In this article I will talk about this and other topics in today's Bitcoin monthly review for April 2021.
1. Bitcoin price correction in April 2021!
After the Bitcoin price started with a sideways movement in April, Bitcoin again recorded a new all-time high of around $ 64,700 on April 14th. Bitcoin did not manage to maintain the upward trend and the first major correction phase of the bull market in 2021 followed.
Source: https://coinmarketcap.com/currencies/bitcoin/
On April 25th, Bitcoin hit the lowest point of the month, around $ 47,500, and has since ricocheted. As of today (May 1st, 2021), Bitcoin is again being traded at prices of over $ 57,000. At the time of the correction, of course, there was again a lot of panic in the market and some people have already spoken of the end of the bull market.
Others saw it as a healthy and long overdue correction that could even go as high as $ 44,000, since that is where the so-called 21 Weekly Emas are located at that time, a moving average line that was tested several times in the last bull market in 2017. This line has not been tested once in this bull market and the corrections are generally smaller than in 2017.
Will Bitcoin test the 21 Weekly Emas in the near future, before it goes up again, or is the correction phase over and is it now going up again steeply to new all-time highs?
We'll know soon ...
In any case, in my opinion and according to technical data, we are still in a bull market and it can be assumed that the Bitcoin price decline is just a healthy correction and not the end of the bull market. (No financial advice of course)
2. Gaming giant "NEXON" buys Bitcoin!
Just a few days ago, on April 28, 2021, the gaming giant "Nexon" from Japan announced that it had bought 1717 BTC for around 100 million US dollars. This equates to a little less than 2 percent of the company's liquid capital, and the average purchase price per bitcoin is approximately $ 58,000. The investment was made to protect cash reserves from inflation, according to CEO Owen Mahoney.
"Our purchase of Bitcoin reflects a disciplined strategy to protect shareholder value and maintain the purchasing power of our cash wealth. In the current economic environment, we believe that Bitcoin guarantees long-term stability and liquidity while maintaining the value of our cash for future investment."
The Japanese company "Nexon" specializes in the development and distribution of online games and has been listed on the Tokyo Stock Exchange since 2011. Since 2020 it has also been part of the Japanese leading index Nikkei 225. The company's more than 50 multiplayer games currently active include Maplestory and KartRider.
Click here for the official Nexon website, with more information about the company: https://www.nexon.com/
3. Reserves in Bitcoin as a store of value are trendy!
Not only Nexon is already using Bitcoin as a store of value and more and more companies are joining them. In our last articles we already informed you about large investments in Bitcoin by the IT giant MicroStrategy, the Chinese company "Meitu" and of course about the investment in Bitcoin by the Tesla company.
It was only recently that "Time Magazine" discovered the benefits of BTC. With the help of Grayscale, the renowned journal now wants to build up Bitcoin reserves, and customers can also use the most important crypto currency to buy media content.
It is obvious that many companies will imitate the pioneers and we will certainly hear from many more large companies in the future that will invest part of their capital in Bitcoin, Ethereum and Altcoins.
4. Binance Stock Tokens, in the sights of BaFin!
It has recently been possible to trade so-called stock tokens on the Binance crypto exchange.
What is it exactly?
"Binance Stock Tokens are tokens of stocks (i.e., shares of public companies) that trade on traditional stock exchanges. Each Stock Token represents one ordinary share of the relevant stock. These Stock Tokens are fully backed by a depository portfolio of underlying securities held by CM-Equity AG, Germany (“CM-E”). Holders of Stock Tokens will qualify for economic returns on the underlying shares, including potential dividends."
Source: https://www.binance.com/en/support/announcement/68f6ebadb16045e297db4a644d795dcc
While the federal government is paving the way with the planned law for the introduction of electronic securities security tokens, stock tokens are enjoying growing popularity. In contrast to security tokens, stock tokens are not digitally securitized assets. Rather, they are synthetic assets that are linked to the price of a particular stock. Each stock token represents a whole share. Because tokens are divisible, the detour via stock tokens also allows proportional investments in the underlying shares. With stock tokens, investors do not acquire voting rights, but the prospect of participating in a rising share price and the distribution of dividends.
According to the German financial regulator BaFin, stock tokens should be treated like securities, as they offer both cash compensation and dividend entitlement.
"If tokens are transferable, can be traded on a crypto-exchange and have economic claims such as dividends or cash settlement, they represent securities and are subject to the prospectus requirement."
Given this background, it seems likely that BaFin will take a closer look at the financial instrument - if it is not already at it. Nevertheless, a classification as a security is far from being set in stone.
5. Tesla sells 10% of its Bitcoin inventory!
Why is this news bullish anyway?
As recently as March, Tesla announced that it had made a $ 1.5 billion investment in Bitcoin. Now, in April, the company's quarterly figures caused a stir in the crypto community ...
The quarterly report shows that of the $ 438 million in net income Tesla generated in Q1 2021, $ 101 million was earned through Bitcoin sales.
Elon Musk was then heavily criticized on Twitter, including by sports blogger David Portnoy, who tweeted the following question of understanding to Elon Musk to his 2.4 million subscribers:
"So am I understanding this correctly? @elonmusk buys #bitcoin. Then he pumps it. It goes up. Then he dumps it and make a fortune. Listen I own 1 #Bitcoin but #bitcoin is exactly who we thought it was. Just don’t be last 1 #HODLing the bag."
Source: https://twitter.com/stoolpresidente/status/1386797551794499592
Elon Musk then spoke up very quickly and made it clear that he had personally not sold any of his Bitcoins. With this, he indirectly announced for the first time that he also holds Bitcoin personally.
Rather, the Bitcoin sale by Tesla served to prove that BTC was a liquid asset. His exact answer was:
"No, you do not. I have not sold any of my Bitcoin. Tesla sold 10% of its holdings essentially to prove liquidity of Bitcoin as an alternative to holding cash on balance sheet."
Source: https://twitter.com/elonmusk/status/1386821144037236737
With the sale of 10% of the Bitcoin stocks of the company Tesla, it has now been proven to other companies and institutions that Bitcoin is a sensible investment and a store of value. So this news is more positive for the crypto market and not negative.
6. Germany pens the way for institutional Bitcoin investors!
As the last of the many news from April 2021, we would also like to share some news from Germany with you, because things are progressing in this country as far as the adoption of Bitcoin and Co. is concerned ...
On July 1, 2021, a new law is expected to come into force that grants around 4,000 special funds more freedom and thus allows investments in cryptocurrencies.
The draft law has already passed the Bundestag and now only needs the approval of the Bundesrat. According to the new law, funds managed for institutional investors can invest a good 20 percent of their assets in crypto assets. This clears the way for institutional crypto funds in Germany.
Source: https://dip21.bundestag.de/dip21/btd/19/288/1928868.pdf
This new law opens the gates to a huge surge of fresh capital for the crypto market. Special funds are not accessible to the general public, but are aimed exclusively at institutional investors.
Analysts assume that the interest from institutional investors will be enormous. Not only will the around 4,000 existing special funds benefit, but also new ones that are usually set up by institutions such as pension funds, insurance companies and banks.
Theoretically, up to 350 billion euros could flow into crypto assets such as Bitcoin through the entry of special funds. With prospects like this, the still bullish crypto market should pick up even more momentum from the summer ...
It remains exciting!
Hear you in my next article and greetings from Germany!
Jonas - @future24