Wild ride for London’s Bitcoin companies as digital coin tumbles


    Online Blockchain PLC, UK-listed company that was founded in 1996 but swapped its business to cryptocurrency in 2017, saw its share price surge 200pc since the end of December to January 7, although it has since pulled back more than 50pc.

    Mode, the cryptocurrency app start-up backed by Jonathan Rowland, saw its shares surge 50pc from the end of December in the first week of January before correcting.

    In the US, Bitcoin mining company Riot Blockchain also came skidding to a halt. The cryptocurrency company, which uses powerful processors to do the number-crunching calculations to mine digital coins, had seen its market cap surge to $1.5bn, but it lost more than 11pc yesterday.

    Peter Wall, chief executive of Argo Blockchain, said crytocurrency buyers needed a “strong stomach” when investing. 

    Argo buys up Chinese-made mining “rigs”, graphics processing machines that are used to perform number crunching calculations needed to mint more Bitcoin.

    Mr Wall said he believed state-money printing last year had left investors looking for “hard assets to move into, such as gold, silver and Bitcoin”. 

    But after Bitcoin’s startling rise over December and January, the digital currency has begun to creep lower, hitting a three-week low. 

    Warning signals over the bubble have been picked up by investors, according to Deutsche Bank. A survey of investors found 90pc believed stock markets were in bubble territory, with Bitcoin top of their concerns.

    The Financial Conduct Authority warned last week that Bitcoin investors should be prepared to lose all their money.

    Fears that US President Joe Biden’s administration could attempt to regulate cryptocurrencies have also weighed on sentiment, traders said.

    During a Senate hearing on Tuesday Janet Yellen, Biden’s pick to head the U.S. Treasury, expressed concerns that cryptocurrencies could be used to finance illegal activities.

    “I think many are used, at least in a transactions sense, mainly for illicit financing, and I think we really need to examine ways in which we can curtail their use and make sure that money laundering does not occur through these channels,” said the former chair of the US Federal Reserve.





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