Bitcoin tumbled Wednesday, Feb. 21, as prices skidded below $11,000. A day earlier, bitcoin rallied closer to the $12,000 mark but was lower nearly 10% in afternoon trading Wednesday. The No. 1 cryptocurrency in the world remained heartily ahead of the important $10,000 threshold, though.
Here are the top crypto stories you need to know for Wednesday.
Bitcoin Gets More Attractive
As the price of bitcoin has increased closer to $12,000 from early-February lows, associated transaction fees have gotten smaller, according to Credit Suisse. It’s a reversal of the trend seen in the last half of 2017, when transaction fees shot up as bitcoin increased in price.
“While this is only a two-week retracement, and continued price appreciation could still cause an increase in fees, this early indication is somewhat contrary to what we would have expected given past trends,” Credit Suisse wrote.
In a Feb. 21 note, Andrew Challenger of Challenger, Gray & Christmas said cryptocurrencies could feasibly become the future of how companies pay their employees.
“The benefits of using them are eliminating the hassle of exchanging currencies and clearing the money through banks. When you pay employees in bitcoin, they don’t have to exchange into a fiat currency or spend it right away – although they can easily do so with the growing number of ecommerce companies processing and accepting cryptocurrencies,” Challenger said.
More than 100,000 merchants accept bitcoin as payment, including Overstock.com Inc. (OSTK) , Action Alerts Plus holding Microsoft Corp. (MSFT) and Expedia Inc. (EXPE) .
Elliott Pulls No Punches
One of the biggest hedge funds in the world, Paul Singer’s Elliott Management, has dropped the hammer on bitcoin: “This is not just a bubble. It is not just a fraud. It is perhaps the outer limit, the ultimate expression, of the ability of humans to seize upon ether and hope to ride it to the stars,” the fund wrote in a January note to clients.
Elliott called cryptocurrencies “one of the most brilliant scams in history.” Elliott also added that cryptocurrencies are playing on the marketing power of financiers and tech junkies alike, plus “others who love the idea of buying a black box (which is obviously empty) for the price of a Kia and dreaming that it will turn into a Mercedes.”
Tesla Inc. (TSLA) experienced cryptojacking after hackers targeted its Action Alerts Plus holding Amazon.com Inc. (AMZN) Amazon Web Services software container to mine for cryptocurrencies. The hack was first reported on the blog of cloud security intelligence frim RedLock. Hackers reportedly accessed Tesla’s AWS software credentials through a non-password protected software container. They then used that container to mine for crypto for an unknown amount of time.
It’s not the first instance of cryptojacking using AWS software. The same happened late last year at British insurance firm Aviva and Amsterdam-based digital security company Gemalto.
Action Alerts Plus holding Nvidia (NVDA) is a great way to invest in crypto, notes TheStreet’s Executive Editor Brian Sozzi.