Bitcoin prices climbed as Christine Lagarde, the managing director of the International Monetary Fund (IMF) praised blockchain, the technology behind bitcoin and other cryptocurrencies.
The price of one bitcoin hovered at $8,107 early Tuesday afternoon Eastern time, up from $7,972 hours earlier, according to multiple cryptocurrency exchanges.
There are several factors that are buoying the bitcoin price, not the least of which is the post-Tax Day rally presaged by noted bitcoin bull and Fundstrat co-founder Tom Lee, who has set a $25,000 bitcoin price target for the end of 2018.
Adding to the wave of positive news for the cryptocurrency market is a nod by IMF boss Christine Lagarde. In an April 16 blog post, Lagarde praised cryptocurrencies as efficient and convenient.
“Crypto-assets enable fast and inexpensive financial transactions, while offering some of the convenience of cash.”
Lagarde explained, “Some payment services now make overseas transfers in a matter of hours, not days. If privately issued crypto-assets remain risky and unstable, there may be demand for central banks to provide digital forms of money―an idea we explore in the forthcoming Global Financial Stability Report.”
Christine Lagarde also heaped praise on blockchain and distributed ledgers, the technologies underpinning bitcoin.
“The underlying technology of crypto-assets — distributed ledger technology, or DLT — could help financial markets function more efficiently,” Lagarde wrote. “Self-executing and self-enforcing ‘smart contracts’ could eliminate the need for some intermediaries. Already, the Australian Securities Exchange has said it plans to use DLT to manage the clearing and settlement of equity transactions.”
A Call For Bitcoin Regulation
Lagarde cautioned that most of the 1,600 cryptocurrencies currently in circulation will not survive, but the big ones, like bitcoin, can pave the way for a transformation of the financial industry.
But in order for that to happen, Lagarde said virtual currencies must rise above their reputation as go-to vehicles for money-laundering and tax evasion.
“Before crypto-assets can transform financial activity in a meaningful and lasting way, they must earn the confidence and support of consumers and authorities,” she wrote. “Understanding the risks that crypto-assets may pose to financial stability is vital if we are to distinguish between real threats and needless fears. That is why we need an even-handed regulatory agenda, one that protects against risks without discouraging innovation.”
Meanwhile, a bitcoin revolution is already quietly underway. Last week, a hedge fund millionaire announced that he’s selling his six-story townhouse in New York City for $30 million, or $45 million in cryptocurrency. Similarly, a Texas resident bought a home using only bitcoin for payment in 2017.
Another sizzling trend is the purchasing of flashy Lamborghinis using bitcoin, as the Inquisitr has reported.
Peter Saddington, an Atlanta computer coder, used 45 bitcoins to buy a $200,000 Lamborghini Huracan in the fall of 2017. Sadding started buying bitcoin in 2011 when it cost less than $3 a coin.
“Buying the Lambo with bitcoin is proof it can be used for real transactions, buying really cool stuff,” Saddington said. “It’s not only used by criminals.”