BUSINESS & AG
2B — THE OBSERVER & BAKER CITY HERALD
THURSDAY, FEBRUARY 18, 2021
Cost of a single Bitcoin exceeds $50,000 for fi rst time
By MATT OTT
Associated Press
SILVER SPRING, Md.
— The seemingly unstop-
pable rise of Bitcoin con-
tinued Tuesday, Feb. 16,
with the cost of a single
unit of the digital currency
rising above $50,000 for the
fi rst time.
The same Bitcoin just
one year ago would have
cost you $10,000. The price
is up almost 200% in the
last three months alone. It
rose sharply early Tuesday
and while giving up some
of those gains, continues to
climb.
Bitcoin has rallied as
more companies signal
the volatile digital cur-
rency could eventually gain
widespread acceptance as
a means of payment. The
vast majority of those who
have acquired Bitcoin have
treated it as a commodity,
like gold, with few places
accepting it in exchange for
goods or services.
Companies have been
leery because of Bitcoin’s
volatility and its use by par-
ties who want to avoid the
traditional banking system
for a myriad of reasons. On
Tuesday, the price crossed
and recrossed the $50,000
barrier at least a half dozen
times.
On Feb. 8, however, the
electric car company Tesla
sent a tremor through the
FRIENDS
Continued from Page 1B
year,” she said, adding gov-
ernment aid has helped.
“We’ve defi nitely taken
advantage of all the oppor-
tunities to get a little bit of
help.”
Still, Friends has man-
aged to thrive amid the
pandemic.
“It defi nitely affected
us, but we had a pretty
good year and we were able
to open back up in May,”
she said of the fi rst shut-
down. “We had really great
Charles Krupa/Associated Press
The Bitcoin logo appears on the display screen of a crypto
currency ATM at the Smoker’s Choice store, Tuesday, Feb.
9, 2021, in Salem, New Hampshire. After a wild week in
which Bitcoin soared to new heights, Bitcoin is crossing
the $50,000 mark.
digital currency markets,
saying it was buying $1.5
billion in Bitcoin as part of
a new investment strategy,
and that it would soon
be accepting Bitcoin in
exchange for its cars.
Then Blue Ridge Bank
of Charlottesville, Virginia,
said it would become the
fi rst commercial bank to
provide access to Bitcoin at
its branches. The regional
bank said Feb. 10 that card-
holders can purchase and
redeem Bitcoin at 19 of its
ATMs.
BNY Mellon, the oldest
bank in the U.S., followed
a day later, saying it would
include digital currencies
in the services it provides
numbers for a while so I
imagine we would’ve had
a really great year if we
hadn’t had to be shut down
for a few months.”
Gladden said she thinks
her patrons’ eagerness to
get out of the house helps.
“After the second freeze
we had in November, I
think a lot of people are
just tired of not being able
to go out if they want,” she
said. “So now, when places
are open, I feel like more
people are ready to go
out because you never
know when it’s going
to get shut down again.”
to clients. Mastercard said
it would start supporting
“select crypto currencies”
on its network.
While most expect a
slow evolution toward
widespread usage of bit-
coins as currency, Richard
Lyons, a fi nance professor
at the University of Cali-
fornia at Berkeley, said it’s
inevitable. Lyons predicted
Bitcoin and other digital
currencies “will become
transactional currencies
increasingly over the next
fi ve years. It’s not going to
happen overnight,” he said.
Lee Reiners, who
teaches fi ntech and cryp-
tocurrency courses at
Duke University School of
Law, said BNY Mellon’s
move makes sense because
“there are now numerous
high-net-worth individ-
uals and investment funds
embracing crypto as an
asset class to be added to
their portfolio.”
But Reiners said he
believes companies will
remain hesitant to accept
Bitcoin for payment
because of its volatility.
“If you were a merchant,
why would you accept
payment in an asset that
could be worth 20% less a
day after you receive it?,”
Reiners said in an email.
Investors will have to
grapple with that volatility
as well. The price of Bitcoin
has soared and dipped since
its debut on the futures
market in 2017. A year
ago, Bitcoin sold for below
$10,000. Those fl uctua-
tions, analysts warn, could
wreak havoc on a compa-
ny’s bottom line and deter
investors.
Assuming Tesla bought
Bitcoin at the volume
weighted average price of
$34,445 in January, the
company is sitting on a
gain of about 38% with
its investment. But in the
regulatory announce-
ment unveiling the invest-
ment, Tesla warned about
the volatility of Bitcoin,
its reliance on technology
for use and lack of a cen-
tralized issuer, such as a
government.
“While we intend to
take all reasonable mea-
sures to secure any dig-
ital assets, if such threats
are realized or the mea-
sures or controls we create
or implement to secure our
digital assets fail, it could
result in a partial or total
misappropriation or loss
of our digital assets, and
our fi nancial condition and
operating results may be
harmed,” Tesla said in the
fi ling.
“Tesla is going to have
to be very careful and com-
prehensive in accounting
for its Bitcoin investment
on its books,” said Anthony
Michael Sabino, a professor
of law, at St. John’s Univer-
sity. “Like any other fi nan-
cial asset other than actual
cash, it might fl uctuate.”
There appears to be
some reluctance among
traditional companies
regarding Bitcoin, at least
as an investment vehicle.
During a recent con-
ference call with inves-
tors, General Motors CEO
Mary Barra said her com-
pany had no plans to invest
in Bitcoin, but would con-
tinue to “monitor and eval-
uate” potential use of digital
currency.
“If there’s strong cus-
tomer demand for it in
the future,” Barra said,
“there’s nothing that pre-
cludes us from doing that.”
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FAMILY
OWNED
Bill Bradshaw/Wallowa County Chieftain
Friends Restaurant and Pub proprietor Bree Gladden,
right, shares directions to Wallowa Lake with customer
Brooke Hampton of California. Last week, the Enterprise
City Council endorsed a liquor license for Friends, and
Gladden hopes to start serving beer and wine in March.
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