Bitcoin Over $7100 As Investors Start to See 'Light at the End of the Tunnel'

Siamak Masnavi

President Trump and the White House Coronavirus Task Force's uplifting daily press briefing on Sunday (April 5) plus declining COVID-19 related mortality rates in various regions around the world seem to have increased investors' appetite for risk, with both U.S. stock futures and Bitcoin currently up around 4%.

So, what are the reasons for investors in stocks and cryptocurrencies to be more optimistic?

Well, let's start with this past weekend's press briefings at the White House.

At Satuday's briefing, Dr. Deborah Birx, the White House coronavirus response coordinator, said that she expeceds counties in New York, Detroit and New Orleans to see a peak in COVID-19 cases in the next few days. 

And at Sunday's briefing, President Trump referred to New York State's first drop in the number of coronavirus-related deaths as a "good sign", and said that he and the task force could see "light at the end of the tunnel." As for Dr. Birx, she also seemed optimistic:

"We're very hopeful that over the next week... we'll see a stabilisation of cases across these large metropolitan areas where the outbreak began several weeks ago."

Later at the same briefing, she went into more detail about why the task force was hopeful:

"We are hopeful because last time I was here I wasn't able to really tell you that Italy and Spain were coming across their apex and coming down the other side...

"To me, that's extraordinarily hopeful. They just completed four weeks of really strong mitigation, and I think that our word to the American people is we can look like that...

"So, that's what the promise is. The promise is if we do this, we could potentially be better."

On Sunday, we also heard from New York State Governor Andrew Cuomo, who said during his daily press briefing that coronavirus-related deaths, ICU admissions, and daily intubations had all gone down, while the  hospital discharge rate had gone "way up."

Also, this week, there is a good chance that Saudi Arabia and the Russian Federation will agree to end their oil price war, which would benefit the U.S. oil industry, therefore helping to drive up both the Dow and the S&P 500.

At the time of writing (09:30 UTC on April 6), premarket trading data shows the Dow, S&P 500, and Nasdaq futures up 3.64%, 3.69%, and 4.00% respectively

As for cryptocurrencies, even though several major central banks have already launched massive quantitative easing programs in a bid to fight the economic threat posed by COVID-19, the growing realization that much more "money printing" will probably be needed in the future to stop the global economy from going into a depression could be enough to convince at least some investors to look at hard assets such as Bitcoin and gold. 

Michael Novogratz, a former Goldman Sachs partner, as well as Founder, Chairman, and CEO of crypto-focused merchant bank Galaxy Digital, talked about his high hopes for both Bitcoin and gold in a tweet he sent out on March 24:

According to data from CryptoCompare, Bitcoin, which has been having a pretty close correlation with the S&P 500 during the COVID-19 crisis, is currently trading at $7,129, up 4.59% in the past 24-hour period:

BTC-USD 24 Hour Chart on 6 Apr 2020.png

Last Friday (April 3), asset management firm VanEck released an Investment Outlook report titled "Bitcoin Correlation to Gold Jumps in 2020" that offered the following key takeaways:

  • "Long-term, bitcoin correlations with traditional asset classes remain low."
  • "Short-term, the market sell-off induced by the COVID-19 pandemic increased bitcoin correlations with traditional asset classes—particularly gold, potentially hinting at bitcoin’s increasing safe-haven status."
  • "A small bitcoin addition to a 60% equity/40% bond blended portfolio significantly reduced portfolio volatility during the recent market sell-off."

'Big Spender' Bitcoin Wallet Exploit Is an 'Issue With BTC Itself', Says BCH Supporter

Michael LaVere
  • Crypto security firm ZenGo has identified a double-spend exploit dubbed "BigSpender" which affected popular bitcoin wallets.
  • Exploit allows an attacker to cancel a bitcoin transaction without the receiving user knowing. 

A crypto security firm has identified a double-spend exploit targeting popular bitcoin wallet providers. 

According to a report by ZenGo, the security firm has discovered a double and multiple spend wallet exploit for bitcoin dubbed “BigSpender.” The report claims the exploit allows an attacker to cancel a bitcoin transaction but still have it appear in a victim’s vulnerable wallet. 

The report reads, 

The core issue at the heart of the BigSpender vulnerability is that vulnerable wallets are not prepared for the option that a transaction might be canceled and implicitly assume it will get confirmed eventually.

As CryptoGlobe reported, ZenGo found that a user’s balance would be increased following an unconfirmed incoming transaction, without a subsequent decrease in the event the transaction being double-spent. The firm outlined how an attacker could use the exploit to cancel transactions of sent bitcoin while still receiving goods and services in return. 

The security firm tested nine popular cryptocurrency wallets and found BRD, Ledger Live and Edge to be vulnerable to the exploit. All three companies were notified by ZenGo of the threat and subsequently updated their products. However, the firm noted that “millions” of crypto users may have been exposed to the attack prior to the update. 

Bitcoin Cash supporter Hayden Otto told Cointelegraph the exploit is particularly concerning for bitcoin-accepting merchants. 

He said, 

The technique is facilitated by RBF (replace by fee), a so-called ‘feature’ added at the protocol level by the Bitcoin Core developers.The issue exists if you use BTC. Wallet software can only make some trade off, which results in a worse BTC user experience, in order to try to protect BTC users.

Otto claimed the exploit was derived from “an issue with BTC itself” and had little to do with wallet software. 

Featured Image Credit: Photo via Pixabay.com