Bitcoin’s surge gives the blockchain firms a boost
BITCOIN started the week with a bang as the flagship crypto-currency jumped by as much as 7pc.
Investors piled in after card payment giant Visa said it would allow the use of another digital currency, USD Coin, on its payment network. USD Coin is a different beast to bitcoin as it is tied to the US dollar, whereas bitcoin is not pegged to anything.
But the news was an encouraging sign for the crypto-currency community that it is becoming more mainstream.
The price of a bitcoin was hovering at around $58,000 last night.
The rise was welcome news for people invested directly in bitcoin, but it was also a boon for people who own bitcoin-related stocks.
Online Blockchain rose 6.4pc, or 4p, to 66.5p, while bitcoin ‘miner’ Argo Blockchain – which uses algorithms to unlock new bitcoins – closed 4.6pc higher, or 10p, to 230p. Although the bitcoin price is up by more than 500pc since a stonking rally kicked off in October, it is still some way off the record highs of $61,000 it hit earlier this month. Bitcoin backers will be hoping prices will stay sky-high, Devere boss Nigel Green insists that any drops will ‘trigger a surge of institutional investment, driving the price up permanently’.
According to Green, inexperienced investors are likely to cash in if bitcoin reverses, and this is when ‘institutional investors, many of whom are just beginning to dip their toe in the crypto water, will likely dive in. They will employ the “buy the dip” mantra.’
The stock market spent the day treading water, with the FTSE 100 slipping 0.1pc, or 4.42 points, to 6736.17 by the close, while the FTSE 250 slid 0.2pc, or 51.19 points, to 21435.54. Optimistic buyers scooped up shares in a handful of stocks that could do well from the UK’s first steps out of lockdown.
Upper Crust-owner SSP rose 4.5pc, or 15.2p, to 351.2p, as shareholders prepared for the return of commuting and a summer of staycations after ministers warned overseas holidays could be prohibited until August.
Greggs rose 4pc, or 86p, to 2262p – nudged higher after UBS raised the target price on its stock from 2190p to 2430p.
One of the ways the Government is plotting to get Britons back out to pubs and restaurants is to use a ‘vaccine passport’, giving greater access to those who have already had their jabs.
Tim Martin, the founder of Wetherspoons (up 0.2pc, or 3p, to 1339p), is not so convinced.
He slammed plans for a ‘papers for pints’ scheme, which he said would be the ‘last straw’ for hundreds of struggling pubs.
Martin said the industry is ‘hanging on for dear life’ after it was ‘devastated by g-force changes of direction’ in restrictions, implemented over the last 12 months to stop the spread of the virus. All Bar One and Harvester-owner Mitchells & Butlers dropped 1.5pc, or 5p, to 319p, and Marston’s fell 0.6pc, or 0.55p, to 99p.
The promise of a staycation summer wasn’t enough to lift bowling alley operator Ten Entertainment, which tumbled 3pc, or 7p, to 223p, as it revealed it swung from a £9m profit in 2019 to a £17.7m loss in 2020.
AJ Bell expects to smash annual revenue estimates after the surge in retail trading that started last spring continued in force. The platform said it expects turnover to hit £136m – £6m higher than previously forecast. Shares rose 1.7pc, or 7p, to 415.5p.
Sunbelt Rentals UK, the British arm of Ashtead Group, placed a £65m order for 2,100 diggers, dumpers and forklifts from JCB – the biggest from a British customer in JCB’s 75-year history.
But it failed to make waves with Ashtead’s shareholders, with its stock falling 1pc, or 41p, to 4278p.