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This file photo taken on June 17, 2014, in Washington, DC, shows bitcoin medals.

KAREN BLEIER/The Globe and Mail

Bitcoin's fantasy meets reality with volatile week

Bitcoin's deep plunge and subsequent recovery this week underlines the battle of wills over how to value the world's best-known cryptocurrency. The virtual money, which soared as high as $18,674 (U.S.) in mid-December, has been losing ground this month. It started Wednesday by plummeting as much as 14 per cent, sinking below $9,300, before rebounding to pass $11,000 on Thursday. The gut-wrenching volatility demonstrates how divided investors are when it comes to valuing a pseudo-money that has no backing in either precious metals or government support. Ian McGugan reports.

These stocks offer a smart and less risky way to bet on blockchain

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Do you suffer from blockchain anxiety? This recently diagnosed condition describes the stress that people feel as they watch other folks get rich by stampeding into an area most of us know nothing about.

The malady hit a feverish new peak last  week thanks to Eastman Kodak Co., a company that for decades has produced only misery for its shareholders. The fading giant reignited investors' enthusiasm by announcing that, hey, it too was now a cool blockchain kid. Its stock price more than doubled on the news.

Kodak is just the latest of a growing number of companies, from iced-tea makers to tiny startups on the Toronto Venture Exchange, that have discovered the wondrous effects of aligning themselves with the trendiest fad in technology. Whatever else blockchain might be, it's a tonic for ailing share prices.

So should you bet on this phenomenon? Maybe so. But you can improve your odds of success by realizing where the real money is most likely to be made. Ian McGugan reports.

This is how cryptocurrency craze may come crashing to a bitter end

Is this the end of the crypto-boom? Probably not. Too many people are still full of high hopes about new forms of computer-generated money despite bitcoin's nearly 40-per-cent slide over the past couple of months. But investors are wising up to some of the practical difficulties that go along with attempting to overturn the world's existing monetary order. Ian McGugan reports.

Marijuana stocks, blockchain transform Canada's investing landscape

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There's life on the Venture. In a corner of the Canadian public market still darkened by the commodity downturn, the mania for all things marijuana and cryptocurrency has ignited a spark. Frenzied trading in pot stocks and blockchain companies has abruptly transformed the TSX Venture Exchange from a market almost wholly dependent on natural resources into a clearinghouse for some of the hottest trends in investing. Tim Shufelt reports.

The charts are saying something telling right now about where bitcoin prices are heading

There are cases such as cryptocurrencies, however, with no conventional means of valuing the asset, where sentiment is more or less the only guide to future returns. In these cases, technical analysis can be extremely telling. Technical analysis is far from foolproof, and not on its own a reason to make market transactions, but in cases such as bitcoin, there's little else to go by. The magnitude of bitcoin's 2017 September-to-December rally – the value in U.S. dollars increased more than fivefold – is such that it makes most charts of technical indicators longer than three months unintelligible. The exception, where some information can be gathered, are moving average trend lines. Scott Barlow reports.

As bitcoin tumbles, new fund offers crypto holders an easy exit

Managers of a new investment fund have a message for those who made staggering gains from bitcoin before the recent sell-off: diversify and avoid the fate of early dotcom believers who were wiped out when tech crashed. "They need to diversify -- take a portion of the profits and do what Mark Cuban did," says Marcus New of InvestX Financial (Canada) Ltd., referring to the billionaire who made his fortune in the early days of the Internet. "What we've tried to do is to make it really easy for them." While a slew of funds already accept cash to invest in virtual currencies, Mr. New believes his fund may be the first to do the opposite: take cryptos to invest in a traditional asset class, in this case private companies about to go public. There's a reason most of the money has been going the other way. Nine funds buying digital currencies tracked by Eurekahedge Pte soared 1,167 per cent in 2017, trouncing the 8-per-cent returns of hedge funds globally. Bloomberg News reports.


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Did Bitcoin just burst? How it compares to history's big bubbles

Hackers have walked off with about 14% of big digital currencies

This is the Globe Investor newsletter, published three times each week. The Thursday issue focuses on cryptocurrencies. If someone has forwarded this e-mail newsletter to you, you can sign up for Globe Investor and all Globe newsletters here.

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Compiled by Gillian Livingston

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