Bitcoin and other major cryptocurrencies are soaring—pushing the combined value of the crypto market back over $200 billion.
Bitcoin, along with top ten tokens ethereum, Ripple’s XRP, litecoin and bitcoin cash have all climbed between 6% and 12% over the last 24-hour trading period, adding over $10 billion to the crypto market.
The bitcoin price has this week rallied back above $7,000 per bitcoin—approaching levels not seen since the coronavirus pandemic sent global markets into meltdown last month.
Bitcoin’s rally comes after social media giant Facebook revealed its embattled libra cryptocurrency project will move forward with a pared-down version in an attempt to satisfy global regulators.
Libra now looks set to be broken up to support multiple coins backed by individual currencies. Libra’s blockchain will also be significantly more centralised than expected, forcing companies to comply with regulations or face removal.
The bitcoin and cryptocurrency community reacted to the news, announced by the Facebook-led non-profit Libra Association, with a mixture of glee and scorn.
“This is good for bitcoin,” said Mati Greenspan, the founder of financial advisory firm Quantum Economics, in a note to clients.
“Facebook’s new watered-down version of libra is an admission that even they are not able to replicate the immaculate conception of bitcoin and that their blockchain will no longer be a serious competitor to any existing crypto-asset. It will however be a serious contender to Paypal, Venmo, and Square,” Greenspan said, adding he’s “not surprised that bitcoin is up 6%.”
“The main downside of these changes is that the system is less open, and less decentralized, therefore the bitcoin community will probably disregard this as another centralized project,” said Yoni Assia, the chief executive of brokerage eToro.
Meanwhile, global markets have cheered the early signs a handful of countries around the world are beginning to lift wide-spread lockdowns that have crippled their economies.
U.S. president Donald Trump has said state governors can re-open businesses in a staggered, three-stage process while German chancellor Angela Merkel has announced plans to slowly ease restrictions brought in to tackle the coronavirus pandemic.
Elsewhere, construction and manufacturing work is back under way in Spain and some regions in Italy have reopened small stores.
U.S. stocks closed marginally higher on Thursday, despite the weekly jobs report showing a further 5.2 million Americans filed for unemployment benefits—taking total first-time unemployment numbers to around 22 million, or 13.5% of the U.S. labor force, since mid-March.
The latest economic numbers out of China show the country’s powerhouse economy shrank for the first time in decades during the first quarter of 2020 as it battled to contain and slow the coronavirus.