Key point: Bitcoin has been a fascinating and controversial cyprocurrency. How many Americans really did put some of their stimulus money towards it as an investment?
Ever since the $1,400 stimulus checks began rolling out to Americans a few weeks ago, people have spent their checks on many different things. The most frequent purchase, according to more than one survey, has been paying bills, although Americans did enough discretionary spending that it caused retail sales to surge in the U.S. in March.
But one thing that hasn’t been the recipient of much spending from stimulus checks has been Bitcoin and other cryptocurrencies.
According to a report earlier this month by Coindesk, while crypto exchanges in the U.S. have begun to see an uptick in customers buying Bitcoin and other digital tokens, it hasn’t been enough to push prices upward. That’s what happened last year after the initial CARES Act stimulus.
Coindesk added that while there had been speculation about big purchases of crypto directly brought upon by the American Rescue Plan, “no cryptocurrency exchanges reported any major bump in $1,400 purchases,” at least as of early April. It was early at that point, the site said, although not enough to move the price of Bitcoin up.
As of April 28, one Bitcoin was valued at $55,123, which is down from the high of over $63,000 on April 15, per Coindesk’s index.
Bitcoin was in the news this spring for another reason: Tesla announced in February both that it had purchased $1.5 billion worth of Bitcoin, and that it would begin accepting payment in Bitcoin for its vehicles.
The company revealed in an SEC filing this week that it was now sitting on $2.5 billion worth of Bitcoin, as of the end of March, CNBC said.
We looked back in February at the money impact of Bitcoin mining, which can be very substantial.
“Instead of relying on intrepid voyagers, bitcoin uses a global network of competing computers. Like safe crackers at a safe-cracking contest, these bitcoin mining machines guess the combination to a digital lock (a long string of digits) with the correct combination winning a few new bitcoins. The combination changes every ten minutes, and the contest continues… This might all sound like a harmless game of digital bingo. But with more and more people enticed by the heady rewards, bitcoin mining on some days uses as much energy as Poland and generates 37 million tonnes of CO2 each year.”
Also in February, we looked at why it would be wrong for the Biden Administration to crack down on Bitcoin (no such crackdown has yet materialized.)
“Cross-border terrorism and money laundering is a big problem in this country, and the Biden administration must contend with both issues,” Ryan Nabil wrote. “Restricting cryptocurrency use and threatening much-needed innovation in banking and financial technology is the wrong solution.”
Stephen Silver, a technology writer for The National Interest, is a journalist, essayist and film critic, who is also a contributor to The Philadelphia Inquirer, Philly Voice, Philadelphia Weekly, the Jewish Telegraphic Agency, Living Life Fearless, Backstage magazine, Broad Street Review and Splice Today. The co-founder of the Philadelphia Film Critics Circle, Stephen lives in suburban Philadelphia with his wife and two sons. Follow him on Twitter at @StephenSilver. This first appeared earlier and is being reposted due to reader interest. Image: Reuters.