Jack Dorsey and Jay Z announce bitcoin fund as cryptocurrency becomes popular

Dorsey tweeted the news Friday, writing that they are accepting requests for an “irrevocable blind trust” focused on Africa and India. He promises that the fund will have “zero direction” from him and Jay Z and that the partners are looking for three board members. Dorsey and Jay Z are investing 500 bitcoin in the project, currently valued at about $ 23 million.

Bitcoin is already in Dorsey’s portfolio. His other company, Square, bought 4,709 bitcoins in October 2020, equivalent to $ 50 million at the time. In 2018, the company expanded its mobile payment service Cash App to support bitcoin trading, even for users without a bank account. And in 2019 it launched Square Crypto, which grants concessions to bitcoin developers and designers.

Also this week, a Twitter executive said in an interview that the company is looking at other new uses of digital currency, including paying employees.

Tesla’s big bet

In its annual filing with the Securities and Exchange Commission, Tesla said it hopes to “start accepting bitcoin as a form of payment for our products in the near future … that we may or may not settle on receipt”.

This news followed the revelation that the automaker is holding $ 1.5 billion in bitcoin on its balance sheet as part of a move to “invest a share of [the company’s] money on certain specified alternative reserve assets. “Tesla lists $ 19 billion in cash and cash equivalents on its balance sheet as of December 31.

Tesla CEO Elon Musk has lately been signaling interest in bitcoin and other cryptocurrencies. In a December 20 tweet, he said “Bitcoin is almost as good as fiat money”, suggesting his belief that it may be less “good” than traditional government-backed currencies.

Mastercard enters

This change “will allow many more merchants to accept encryption” as well as “eliminate inefficiencies, allowing consumers and merchants to avoid having to make conversions between cryptography and traditional [currency] to shop, “said Mastercard.

Bitcoin arrives at America’s oldest bank

BNY Mellon – America’s oldest bank – which dates from the founding of Bank of New York by Alexander Hamilton in 1784 – announced on Thursday that it had formed a “digital assets” unit. It will begin helping customers meet needs related to the growth of digital assets, including cryptocurrencies, on an unspecified date later this year.

Customer demand and clearer regulation “present a tremendous opportunity for us to extend our current service offerings to this emerging field,” said Roman Regelman, CEO of asset maintenance at Mellon.

Bitcoin is becoming an “alternative asset”

“As more and more companies start accepting bitcoin, this will only lead to further increases in demand in a market with limited supply,” wrote Fawad Razaqzada, an analyst at ThinkMarkets, in a note to customers.

“Bitcoin is becoming an alternative asset,” said Brad Bechtel, global head of FX at Jefferies. “It is not related to anything else on the market.” And that makes it an attractive asset to add to a portfolio, he added.

This is quite optimistic for the long-term perspective of bitcoin, even though some, notably Bank of America, have called the crypto rally “the mother of all bubbles”.

– Anneken Tappe and Chris Isidore of CNN Business contributed to this report.