June 9, 2016- In This Issue:

 

  

Bitcoin Prices Soar in May: Analyzing the Market's Second Best Month of 2016 
With the price of bitcoin appreciating nearly 20% in May and breaking past $500 for the first time since 2014, it's safe to say the digital currency is once again back in the mainstream spotlight as an investment opportunity.

However, what may be most notable is that the gains took place amid strong overall sentiment. Data reveals the gains coincided with high long-short ratios and other indicators that sentiment is turning strongly bullish as we enter the summer months.

But, while May's price rally may seem impressive due to the substantial media interest it's achieved, it was only the fourth-largest monthly gain in the last year, CoinDesk USD Bitcoin Price Index (BPI) data reveals.

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U.S. Election Puts $1,000 Bitcoin Within Reach
In my now bi-weekly look at Bitcoin I tend to focus on the news rather than the price. Bitcoin is a long-term challenge to banking and even money as we know it, and I have felt that progress in terms of recognition and understanding is more important than the vagaries of the market.

I last looked at price back in April, when I argued that the long term chart for BTC/USD was supportive of the bull case. At that time BTC/USD was trading at around $425, and is now around $576, about 35 percent higher, so I guess that worked out okay. The recent consolidation above $500, though, prompts an interesting question, and one that many people thought would never again be asked, or at least not for a long time: Is BTC/USD above $1000 a possibility in the near future?

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Maker of First Bitcoin Mining ASIC Acquired in What Could Be Industry's Largest Sale
The China-based company behind the first bitcoin mining ASIC has been acquired, though the exact details of the sale vary.

Canaan Creative, the company that produces the Avalon chip series, confirmed its acquisition by Shandong Luyitong Intelligent Electric PLC today in an email to CoinDesk. Shandong Luyitong is an electronics firm founded in 2003, and that is publicly listed on the Shenzhen Stock Exchange.

As for the exact amount paid in the acquisition, initial statements from parties involved or close to the deal indicate it could be the largest-ever exit for bitcoin startup.


According to news source Ifeng.com, Shandong Luyitong paid ¥3.06bn (roughly $466m) in stock purchases and cash to acquire 100% ownership of the firm. Further, it said Shandong Luyitong is planning a private share offering in conjunction with the sale, looking to sell as many as 6.79 billion shares at a price of ¥24.57 per share.

In a separate Twitter post, Jihan Wu, CEO of China-based bitcoin mining firm Bitmain, reported that the firm was to be publicly listed through its relationship with Shandong Luyitong, and that it is seeking to raise ¥0.67bn at a valuation of ¥3.1bn.

Representatives of Canaan did not immediately provide more details, stating they were unable to disclose more than what is public at this time.

The Avalon chip was the first application-specific integrated circuit (ASIC) designed for bitcoin mining to hit the market, or the process by which new transaction blocks are created on the bitcoin network. Canaan Creative was founded in 2012, releasing its first Avalon chip the following year.

The company has made no official announcement about the deal through its social media channels. Shandong Luyitong did not immediately respond to requests for comment.

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