The European Central Bank is expected on Thursday to leave interest rates at record highs but to imply that a cut in borrowing costs is likely by the summer
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If you have more than $250,000 in deposits at a bank, you may want to check that all of your money is insured by the federal government.
The Federal Insurance Deposit Corporation, or FDIC, implemented new requirements for deposit insurance for trust accounts starting April 1.
While the FDIC’s move is intended to make insurance coverage rules for trust accounts simpler, it may push some depositors over FDIC limits, according to Ken Tumin, founder of DepositAccounts and senior industry analyst at LendingTree.
The FDIC is an independent government agency that was created by Congress following the Great Depression to help restore confidence in U.S. banks.
FDIC insurance generally covers $250,000 per depositor, per bank, in each account ownership category.
If you have $250,000 or less deposited in a bank, the new changes will not affect you.
How FDIC coverage of trust accounts has changed
Under the new rules, trust deposits are now limited to $1.25 million in FDIC coverage per trust owner per insured depository institution.
Each beneficiary of the trust may have a $250,000 insurance limit for up to five beneficiaries. However, if there are more than five beneficiaries, the FDIC coverage limit for the trust account remains $1.25 million.
“For those who do go above $1.25 million under the old system, they definitely should be aware that changed,” Tumin said.
That may cause coverage reductions for certain investments that were established before these changes. For example, investors with certificates of deposit that are over the coverage limit may be locked into their investment if they do not want to pay a penalty for an early withdrawal.
“If you’re in that kind of shoes, you have to work with the bank, because you might not be able to close the account or change the account until it matures,” Tumin said.
The FDIC is also now combining two kinds of trusts — revocable and irrevocable — into one category.
Consequently, investors with $250,000 in a revocable trust and $250,000 in an irrevocable trust at the same bank may have their FDIC coverage reduced from $500,000 to $250,000, according to Tumin.
“That has the potential of causing loss of coverage, too,” Tumin said.
The agency is also revising requirements for informal revocable trusts, also known as payable on death accounts. Previously, those accounts had to be titled with a phrase such as “payable on death,” to access trust coverage limits. Now, the FDIC will no longer have that requirement and instead just require bank records to identify beneficiaries to be considered informal trusts.
“The bank no longer has to have POD in the account title or in their records as long as the beneficiaries are listed somewhere in the bank records,” Tumin said.
To amplify FDIC coverage beyond $250,000, depositors have several other options in addition to trust accounts.
That includes opening accounts at multiple FDIC-insured banks; opening a joint account for two people, which would bring the total coverage to $500,000; or opening accounts with different ownership categories, such as a single account and joint account.
Saving $1 million in your 401(k) is no easy accomplishment. Most people never make it to that milestone.
Only the top 3.3% of retirement savers had accumulated over $1 million across their accounts as of the end of the last decade, according to estimates from the Employee Benefit Research Institute, based on the latest Federal Reserve Survey of Consumer Finances. But if you know what those 401(k) millionaires know, you could join this elite group.
They don’t have any insider information. And most didn’t get lucky by vesting company stock in their 401(k) before the price went parabolic. They just understand how to make the most of their 401(k) plan.
Here are three secrets of 401(k) millionaires.
Image source: Getty Images.
1. They always get their full company match
If there’s one thing you must do to make the most of your 401(k), it’s to get the full company match. If you aren’t contributing enough to get it, you’re practically leaving free money on the table.
Every 401(k) plan will have a different matching policy, but the basics are the same for most companies. If you contribute up to a certain percentage of your salary, your company will also contribute an amount up to 100% of your contribution. Some common 401(k) matching contributions are $0.50 per dollar up to 6% of your pay or a dollar-for-dollar match on the first 3% and $0.50 per dollar on the next 2%.
It’s worth pointing out that unless you’re earning a very high income, you can usually get your full company match with contributions well below the limit for a 401(k). For 2024, the 401(k) deductible contribution limit is $23,000, or $30,500 for workers age 50 or older. So it’s not like you need to be some super saver to set yourself up for a $1 million 401(k).
Getting your full company match will typically put your savings rate close to 10% of your salary per year. Even with an average salary of just $60,000 per year, you’ll end up contributing $6,000 per year. If you can consistently do that for a full 40-year career, you’re very likely to end up with $1 million in your 401(k).
2. They always minimize their fees
For all the benefits of a 401(k) plan, they typically come with one major drawback: The fees can be a significant drag on your investment returns. But if you know what the 401(k) millionaires know, you can minimize the impact of fees on your account.
There are three types of 401(k) fees: administrative, service, and investment fees. Unfortunately, you’re stuck paying whatever administrative fees your company plan dictates. But when it comes to service and investment fees, you can exercise a lot more control.
Service fees are the one-time charges you might pay for using some of the features of your 401(k) plan. For example, you might have to pay a service fee to take out a 401(k) loan or use a participant-directed account. Those services are totally optional, so you won’t pay anything if you don’t use them, but the fee could be worth it in some instances.
The bigger cost for most retirement savers are the investment fees. These are charged by funds offered by your 401(k). Finding funds with a low expense ratio will have a massive impact on your overall returns. And the good news is that funds with low expense ratios are usually broad-based index funds, which have historically outperformed actively managed mutual funds, which you might also find in your 401(k) plan.
If you can stick to the lowest-cost funds and avoid unnecessary service fees, you’ll be well on your way to joining the 401(k) millionaires.
3. They never interrupt their investments unnecessarily
The biggest secret of 401(k) millionaires is that they’ve been investing for a long time. What’s more, they haven’t stopped or withdrawn funds until they need to in retirement.
That means they invested in good times and bad. When stocks looked expensive, they still contributed to their 401(k). When the stock market was crashing and everyone was running for the hills, they still contributed to their 401(k). The discipline of consistently contributing and letting compound earnings work for them is what truly separates 401(k) millionaires from the average retirement saver.
If you want to become a 401(k) millionaire, you have to understand the power of compounding. It might not seem like much that first year you contribute 10% of your salary to your 401(k). It might not even feel like much after the fifth year.
But eventually, you’ll see your account growing quicker than you ever imagined as it pushes toward $1 million. That only happens, though, if you keep your money invested and never disrupt it unnecessarily.
If you can manage to consistently invest throughout your career, you should find yourself joining the small group of 401(k) millionaires by the time you’re ready to retire.
Respiratory syncytial virus – viral vaccine under research
Hailshadow | Istock | Getty Images
A vaccine from Pfizer showed the potential to protect adults ages 18 to 59 who are at increased risk of getting severely sick from respiratory syncytial virus in a late stage clinical trial, the company said Tuesday.
The initial data suggests that Pfizer’s shot, known as Abrysvo, could help protect a far wider population from RSV. The jab is currently approved in the U.S., Europe, Japan and other countries for adults ages 60 and older and expectant mothers who can pass on protection to their fetuses.
But there are no RSV shots approved worldwide for younger, high-risk adults.
RSV causes thousands of hospitalizations and deaths among older Americans and hundreds among infants each year. The virus can also cause severe illness in younger adults with weakened immune systems or underlying chronic conditions such as asthma and diabetes.
Nearly 10% of U.S. adults ages 18 to 49 have a chronic condition that puts them at risk of severe RSV disease, according to Pfizer. That number rises to around 24% for those aged 50 to 64.
“I think about my own family and my friends who have asthma or were carrying conditions from childhood,” Dr. Iona Munjal, Pfizer’s executive director of clinical vaccine research and development, told CNBC. “That population is at risk of getting RSV every single winter … over and over again. There’s no durable immunity without vaccination.”
Munjal added that high-risk adults aged 18 to 59 are the “next logical step” after working to drop rates of RSV disease in older populations.
The data comes as Pfizer tries to win more share of the RSV market after lagging behind GlaxoSmithKline last year. GSK’s RSV vaccine for adults ages 60 and above booked around £1.2 billion ($1.5 billion) in sales last year. Meanwhile, Pfizer’s shot recorded about $890 million in revenue in 2023.
Pfizer said it plans to submit the data to regulatory agencies and file for an expanded approval of Abrysvo for ages 18 and up. The company did not provide any details on the timeline for those plans.
Pfizer also intends to present final results from the trial at an upcoming scientific conference and submit them for publication in a peer-reviewed journal.
Initial safety and efficacy data
CFOTO | Future Publishing | Getty Images
Pfizer said Tuesday its vaccine met the phase three trial’s main goals for efficacy and safety in high-risk adults ages 50 to 59.
The company specifically released data on a sub-study examining nearly 700 patients who are at high risk of severe RSV due to underlying medical conditions. Pfizer expects to release data on another sub-study on roughly 200 patients with weakened immune systems later this year, Munjal told CNBC.
A single dose of the drugmaker’s shot elicited an immune response against RSV A and RSV B, which are the two major subtypes of the virus, according to the results.
The immune response was similar to that observed in adults 60 and above. Previous late stage research on more than 30,000 adults in that older age group found that Pfizer’s shot maintained protection against RSV across two full seasons of the virus.
“The level of antibodies that you see after vaccination in those who are 18 to 60 are similar to those who are 60 and up,” Munjal told CNBC. She later added that it “gives you confidence that across those two populations, they’re actually responding to vaccine the same, and therefore are likely to have a similar efficacy.”
Participants also saw a fourfold increase in their levels of protective antibodies against RSV A and RSV B one month after they received Pfizer’s shot compared to before vaccination.
The company said patients tolerated the vaccine well in the trial. Safety data in high-risk adults ages 18 to 59 was consistent with the results in adults 60 and above, Pfizer added.
GSK released late stage trial data in October suggesting that its shot could protect adults ages 50 to 59.
The Food and Drug Administration in February granted “priority review” to GSK’s application to expand approval of its drug, Arexvy, to that new age group. That designation speeds up the review process for certain drugs for serious conditions.
The FDA is expected to decide whether to approve GSK’s RSV vaccine for adults ages 50 to 59 on June 7.
These companies are close to launching new products that could supercharge revenue.
Eli Lilly shares have soared more than 100% over the past year, bringing the company to a market value of more than $740 billion. Investors are excited about the pharma company because of its dominance in the billion-dollar weight loss drug market. Lilly sells two weight-loss drugs that, together, are bringing in billions of dollars in revenue, and demand for the products has even outpaced supply.
If you’ve missed out on Lilly’s big gains, though, don’t worry. You still can catch other opportunities thanks to the biotech and pharma industries’ endless flow of innovation and product launches. These may fuel immediate as well as long-term share price gains. Let’s check out two healthcare stocks with big catalysts on the horizon that could supercharge your portfolio right away and over time.
Image source: Getty Images.
1. Moderna
Moderna (MRNA 6.18%) today is known for its blockbuster coronavirus vaccine. That product, the company’s one and only, helped the stock soar in earlier stages of the pandemic but, in more recent times, prompted investors to worry about future growth as demand for vaccination dropped.
The good news is Moderna may not be a one-product player for long. The company has a big catalyst coming up, with the U.S. Food and Drug Administration (FDA) set to decide on its respiratory syncytial virus (RSV) vaccine by May 12.
Though Pfizer and GSK already have commercialized their RSV vaccines, Moderna could have an edge for two reasons. First, the two big pharma companies reported cases of rare neurological condition Guillain-Barre syndrome in their clinical trials. Moderna didn’t. So, healthcare providers may prefer the safety profile of the potential Moderna product.
And second, Moderna’s investigational vaccine is the only one to come in a prefilled syringe format. This, too, could win over those who administer the vaccine because it cuts down on the potential for errors and speeds up the vaccination process. All of this means that, even though Moderna is later to market than Pfizer and GSK, it still could carve out significant share and even leadership.
The peak annual RSV market could be $10 billion, according to Moderna, so this vaccine may become a significant growth product for the biotech. And that makes now a great time to get in on Moderna, at the bargain level of 8.5 times forward earnings estimates.
2. Vertex Pharmaceuticals
Vertex Pharmaceuticals (VRTX 0.02%) doesn’t just have one big catalyst around the corner: It has two. The biotech giant aims to submit two approval requests to the FDA by the middle of this year, one for a new cystic fibrosis (CF) treatment candidate and another for its investigational pain medication. Both of these have blockbuster potential.
Vertex already is known as the world’s leader in CF treatment thanks to its drugs’ top performance, extending patients’ lives and quality of life. It already has the drugs and intellectual property to maintain this through the mid-2030s. Now, it may extend this by launching “the vanza triple,” an investigational treatment that’s even better than its current best-seller.
The big biotech also is expanding beyond this specialty, and through its clinical trials has shown it has what it takes to excel in other areas too. Vertex recently reported positive data from phase 3 trials of its non-opioid pain candidate, VX-548. The company aims to win a broad label for the treatment of moderate-to-severe acute pain, and later gain approval in chronic pain indications. This could be a huge opportunity because, today, pain treatments are limited to over-the-counter ones with limited efficacy or prescription opioids, which are linked to addiction.
The vanza triple and VX-548 could offer Vertex’s already solid revenue growth a big boost. And that makes the shares, trading at 24 times forward earnings estimates today, look like a great deal.
Adria Cimino has positions in Vertex Pharmaceuticals. The Motley Fool has positions in and recommends Pfizer and Vertex Pharmaceuticals. The Motley Fool recommends GSK and Moderna. The Motley Fool has a disclosure policy.
No next-big-thing investment trend has arguably been hotter since the advent of the internet than artificial intelligence (AI) is right now.
When discussing “AI,” I’m referring to software and systems handling tasks that would normally be overseen by humans. Machine learning gives software and systems the ability to learn and evolve without human intervention, which can make these systems more proficient at their tasks over time.
The utility of AI can’t be overstated enough. Almost every sector and industry can benefit from its use, which is probably why the analysts at PwC believe artificial intelligence will add $15.7 trillion to the global economy come 2030.
While most institutional money managers and Wall Street analysts view AI and the companies deploying AI infrastructure and software favorably, this bullishness isn’t universal. Based on the low-water price targets issued by a select group of Wall Street analysts, the following five AI stocks could plunge by as much as 86%!
Nvidia: Implied downside of 30%
The first AI stock that could tumble after a monstrous run higher is none other than the infrastructure backbone of the AI revolution, Nvidia (NASDAQ: NVDA). In February, D.A. Davidson analyst Gil Luria raised his and his firms’ price target on Nvidia to $620 from $410. Despite this epic increase, it implies that the third-largest public company by market cap in the U.S. will shed 30% of its value, based on where it closed on April 5.
Although Nvidia’s A100 and H100 graphics processing units (GPUs) have been the overwhelming top choice of businesses for AI-accelerated data centers, there are plenty of reasons to be believe Nvidia stock could be in a bubble.
To start with, Nvidia’s top four customers, which comprise about 40% of its sales, are all developing AI GPUs of their own. Even if these companies continue to rely on Nvidia’s GPUs as complements to their in-house GPUs, future orders from these industry leaders would be expected to decline.
To add to the above, Nvidia’s pricing power on its A100 and H100 GPUs is expected to take a hit in the latter-half of 2024. The lion’s share of its 217% increase in data center sales in fiscal 2024 (ended Jan. 28, 2024) was driven by GPU scarcity. As new competitors enter the arena and Nvidia ramps up its own production, GPU scarcity will diminish — as will the company’s pricing power.
Further, every next-big-thing trend over the last 30 years has navigated its way through an early stage bubble. Suffice it to say, I fully expect Luria’s price target to be hit.
Super Micro Computer: Implied downside of 74%
A second artificial intelligence stock that could plummet in the not-too-distant future if one Wall Street analyst is correct is server and storage solutions company Super Micro Computer (NASDAQ: SMCI). Senior equity research analyst Mehdi Hosseini of Susquehanna stood firm on his price target of $250 for Super Micro just two months earlier in an interview on CNBC. This would imply Super Micro Computer losing almost three-quarters of its current value.
It’s understandable why investors have gone head over heels for Super Micro. The company incorporates Nvidia’s top-tier GPUs in its energy-efficient and highly customizable rack servers that are utilized in AI-accelerated data centers. Sales for the company are expected to double in 2024 to north of $14 billion.
However, we’ve been here before with Super Micro. It was expected to be a prime beneficiary of the cloud-computing revolution in the late 2010s, but failed to maintain its sales momentum. This speaks to the fact that investors have a terrible habit of overestimating the adoption of new trends and innovations.
Super Micro Computer also finds itself at the mercy of Nvidia. If the latter continues to deal with supply issues/scarcity for its GPUs, Super Micro will fail to realize its full potential.
While a retracement to $250 may not be in the cards anytime soon, Super Micro Computer definitely has a lot to prove after its stock appreciated by 767% over the trailing year.
Tesla: Implied downside of 86%
The potential disaster du jour among AI stocks is North America’s leading electric-vehicle (EV) manufacturer Tesla (NASDAQ: TSLA). CEO and founder Gordon Johnson of GLJ Research believes Tesla will retrace to $23.53 per share, which would represent 86% downside from where it closed on April 5.
On one hand, Tesla has made history by becoming the first automotive company to build itself from the ground up to mass production in well over a half-century. It’s also the only EV pure-play that’s generating a recurring profit (four consecutive years, as of the end of 2023).
At the same time, Tesla is encountering game-changing challenges as EV demand tapers off. The company slashed the sales price of its four production models (3, S, X, and Y) on more than a half-dozen occasions in 2023. The end result has been a more-than-halving in Tesla’s operating margin since the end of September 2022 (17.2% to 8.2%, as of Dec. 31, 2023).
Perhaps an even bigger issue is that Tesla has failed to become more than just a car company. Its Energy Generation and Storage segment sales have stagnated in recent quarters, while Services is generating a low-single-digit gross margin. I’ll add that solar has been a money-loser since SolarCity was acquired in 2016.
Despite being nothing more than a car company, Tesla is valued at nearly 60 times forecast earnings in 2024. With most auto stocks trading in a range of 6 to 8 times expected earnings per share (EPS), there’s definite reason to believe Tesla stock will head lower.
MicroStrategy: Implied downside of 85%
A fourth artificial intelligence stock that could get absolutely crushed if the most-bearish Wall Street analyst proves accurate is enterprise analytics software company MicroStrategy (NASDAQ: MSTR). Last August, Jefferies analyst Brent Thill defended his firms’ lowball price target of $210 for MicroStrategy, which would imply a decline of 85% from where shares closed this past week.
One issue for MicroStrategy is that its AI-driven enterprise analytics software division stopped growing 10 years ago. Sales have fallen by an aggregate of 14% since peaking.
But let’s face the facts: MicroStrategy is best-known for CEO Michael Saylor’s strategy of issuing convertible debt and using the proceeds to buy Bitcoin (CRYPTO: BTC), the largest cryptocurrency by market cap. On March 19, Saylor made a post on X (the platform formerly known as Twitter) that noted his company held 214,246 Bitcoin — more than 1% of the eventual supply — at an average price of roughly $35,160 per token.
With each Bitcoin valued at $67,600, as of the time of this writing, MicroStrategy’s crypto stake is worth $14.5 billion. However, the company’s market cap currently stands at $24.4 billion. Accounting for the company’s modestly profitable (but non-growing) software business, as well as its growing debt pile, MicroStrategy is trading at around a 70% premium to the Bitcoin it holds.
If investors want to buy Bitcoin, a spot Bitcoin exchange-traded fund (ETF) or a direct purchase of the cryptocurrency on an exchange would be a considerably smarter move than buying into MicroStrategy, whose premium valuation to the current price of Bitcoin makes no sense.
Palantir Technologies: Implied downside of 78%
The fifth AI stock that could plunge, according to the prognostication of one Wall Street analyst, is data-mining company Palantir Technologies (NYSE: PLTR). Analyst Rishi Jaluria of RBC Capital doesn’t believe Palantir’s Commercial segment margins can continue expanding at their current pace. This compelled Jaluria to recently reiterate his and his firms’ $5 price target on Palantir, which implies 78% downside.
There’s no question Palantir’s stock is pricey. The company’s nearly $51 billion market cap is closing in on a multiple of 19 times forecast sales this year. It’s also valued at 70 times consensus EPS in 2024 despite slowing sales growth.
But one thing Palantir has working for it that merits a hefty premium is its irreplaceability. No company at scale comes anywhere close to the solutions it can provide. Palantir’s AI-driven Gotham platform helps governments cull data and plan military operations. The contracts Palantir wins from the U.S. government tend to span multiple years and generate highly predictable cash flow.
Meanwhile, its Foundry platform is just getting off the ground and helping businesses make sense of their data so they can streamline their operations. Whereas a sales ceiling exists with Gotham — i.e., Palantir won’t offer access to its platform to certain countries (e.g., China) — Foundry has a theoretical growth runway that stretches decades into the future.
Though it could take some time for Palantir to grow into its current valuation, I don’t anticipate Jaluria’s low-water price target being hit.
Should you invest $1,000 in Nvidia right now?
Before you buy stock in Nvidia, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Nvidia wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Consider when Nvidia made this list on April 15, 2005… if you invested $1,000 at the time of our recommendation, you’d have $539,230!*
Stock Advisor provides investors with an easy-to-follow blueprint for success, including guidance on building a portfolio, regular updates from analysts, and two new stock picks each month. The Stock Advisor service has more than quadrupled the return of S&P 500 since 2002*.
*Stock Advisor returns as of April 8, 2024
Sean Williams has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Bitcoin, Jefferies Financial Group, Nvidia, Palantir Technologies, and Tesla. The Motley Fool has a disclosure policy.
5 Artificial Intelligence (AI) Stocks That Can Plunge Up to 86%, According to Select Wall Street Analysts was originally published by The Motley Fool
In this video, I will talk about two beaten-down stocks that are down 78% from their all-time highs and down 40% and 60% in the past five years.
*Stock prices used were from the trading day of April 5, 2024. The video was published on April 8, 2024.
Should you invest $1,000 in Alibaba Group right now?
Before you buy stock in Alibaba Group, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Alibaba Group wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Consider when Nvidia made this list on April 15, 2005… if you invested $1,000 at the time of our recommendation, you’d have $539,230!*
Stock Advisor provides investors with an easy-to-follow blueprint for success, including guidance on building a portfolio, regular updates from analysts, and two new stock picks each month. The Stock Advisor service has more than quadrupled the return of S&P 500 since 2002*.
*Stock Advisor returns as of April 8, 2024
Neil Rozenbaum has positions in PayPal. The Motley Fool has positions in and recommends PayPal. The Motley Fool recommends Alibaba Group and recommends the following options: short June 2024 $67.50 calls on PayPal. The Motley Fool has a disclosure policy. Neil is an affiliate of The Motley Fool and may be compensated for promoting its services. If you choose to subscribe through his link, he will earn some extra money that supports his channel. His opinions remain his own and are unaffected by The Motley Fool.
2 Growth Stocks Down 78% to Buy Before It’s Too Late was originally published by The Motley Fool
Major cryptocurrencies rallied to new highs thanks to multiple tailwinds.
Several major cryptocurrencies started the week on a high note today amid a confluence of positive catalysts, including potential short squeezes, technical trading tailwinds, and — perhaps most surprising — geopolitical tailwinds from leading Chinese money management firms.
When all was said and done, as of the close of Monday’s regular session, the price of Ethereum (ETH -0.27%) was up 9.1%, Bitcoin (BTC -2.04%) had rallied 3.8%, and Dogecoin (DOGE -3.82%) gained a little over 2%.
On a possible crypto short squeeze, technical tailwinds
According to Coinglass data this morning, the digital asset market has seen more than $176 million in liquidations over the past 24 hours, the vast majority of which (around $124 million, or 72%) came from liquidations of open short positions.
As the price of major cryptocurrencies has rallied in recent weeks — spurred by a combination of factors, including strong inflows into Bitcoin ETFs, an upcoming Bitcoin halving event, and expectations for the possible approval for the first spot Ethereum exchange-traded funds (ETFs) — it appears that short-sellers are effectively being forced to close their bearish positions. The resulting surge in buying demand can cause a so-called short squeeze, sending digital asset prices even higher in the process.
Meanwhile, technical trading patterns may also be playing a role. According to the widely followed Bitcoin analyst TechDev on social media platform X, the price of Bitcoin appears to be consolidating above key technical levels and trading averages that have historically preceded significant rallies for the world’s most prominent cryptocurrency.
Is China entering the Bitcoin ETF market?
If that wasn’t enough, Chinese financial news site Securities Times reported on Monday that multiple China-based financial giants, including Harvest Fund and Southern Fund, have submitted applications through Hong Kong subsidiaries for their own spot Bitcoin ETFs. Those applications are currently awaiting regulatory approval.
This news is particularly significant, given China’s previous public hostility against Bitcoin. In 2021, China’s top regulators even banned crypto trading and mining, sending the price of Bitcoin plunging at the time. It became evident in recent years, however, that China’s ban on crypto wasn’t absolute, and crypto trading and mining has reportedly continued to thrive in the country. If China is indeed softening its stance, it would serve as only the latest significant validation for the global adoption of Bitcoin and other cryptocurrencies.
The U.S. Securities and Exchange Commission (SEC) only approved the world’s first 13 Bitcoin ETFs in January 2024. The historic approvals served as arguably the most prominent validation yet of cryptocurrencies as a legitimate investment asset class. Because ETFs can be bought and sold throughout the normal trading day via nearly any online brokerage — in contrast to requiring investors to set up separate crypto trading accounts with a crypto-specific firm — they’re a much more accessible investment medium for anyone considering making cryptocurrencies a meaningful part of their portfolio.
Bitcoin ETFs have experienced enormous inflows since then; late last month, for instance, the ARK 21 Shares Bitcoin ETF (NYSEMKT: ARKB) registered net inflows of more than $200 million, becoming the third Bitcoin ETF in the U.S. to cross the $200 million mark this year.
For perspective, China’s Harvest Fund and Southern Fund manage over $230 billion and $280 billion in total assets, respectively. So, if their Bitcoin ETF applications pass regulatory muster through their Hong Kong subsidiaries, and the mainland Chinese government continues to opt for a more cautious approach with indirect approval, it could signal a massive positive shift toward more pervasive crypto adoption over the long term from the world’s second-largest economy.
That certainly doesn’t guarantee that Bitcoin, Ethereum, and Dogecoin will continue this incredible rally indefinitely. But as cryptocurrencies, in general, continue to enjoy greater adoption on a global scale, it’s hardly surprising to see the prices of the most prominent digital assets continuing to reach new highs.
Steve Symington has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Bitcoin and Ethereum. The Motley Fool has a disclosure policy.
A Key Bridge Response 2024 Unified Command image of response crews remove shipping containers using a floating crane barge after the cargo ship Dali struck and collapsed the Francis Scott Key Bridge, on April 7, 2024 in Baltimore, Maryland.
Handout | Getty Images News | Getty Images
The process of removing shipping containers from the 984-foot-long Dali has begun, but it is expected to take weeks to complete the job, tow the listing ship, and get the Port of Baltimore reopened for marine traffic after the bride collapse which occurred on March 26.
Seven containers have been removed since Unified Command started the process on Sunday to clear up the canal and ultimately reopen for container traffic, a spokesperson for the Key Bridge Response 2024 Joint Information Center told CNBC. The initial goal is to remove 10 to 12 containers to create a safe working area for the crews involved in recovery efforts for missing workers and removal of debris. The containers that are being removed are leaning over on the port side of the Dali’s bow and pose a risk to crews working in the area.
Unified Command is comprised of Synergy Marine, the management company of the Dali, the U.S. Coast Guard, U.S. Army Corps of Engineers, Maryland Department of the Environment, Maryland Transportation Authority, and Maryland State Police.
Approximately 140 containers in all are expected to be removed to lighten the Dali so the grounded vessel can be refloated and moved by tugs. It is expected to take approximately two weeks to unload all of the containers.
The first seven containers were on a single barge and taken to Sparrows Point, the former site of a large industrial complex owned by Bethlehem Steel. Sparrows Point is a 3,100 acre peninsula reaching into Baltimore Harbor. The JIC said the containers will stay at Sparrows Point until “further disposition is approved and coordinated.”
Debris removed from the Key Bridge collapse site being checked by crews at Sparrows Point.
Key Bridge Response 2024 Unified Command | U.S. Coast Guard Petty Officer 3rd Class Erin Cox
The barges being loaded with containers all have different container-carrying capacities, according to JIC.
The logistics details for cleared containers are still being discussed, with the JIC telling CNBC its “current intent” is to send them to the CSX Terminal.
A CSX spokesperson told CNBC the freight rail company has expressed a willingness and desire to help with the recovery efforts in Baltimore, and said conversations are ongoing, but added, “We have no significant updates to report at this time.”
CSX was the first rail to start a rail service for diverted containers resulting from the accident and closure of the Port of Baltimore.
Once the Dali is refloated and no longer listing, tugs will move the vessel to the CSX terminal at the Port of Baltimore. It is still to be determined how many tugs will be needed to move the Dali, according to the JIC. “That is currently pending and is being planned out,” it said in an email to CNBC.
The removal of the debris and the vessel is key to the reopening of the Port of Baltimore, which is the largest port for auto imports and exports in the country, as well as a key trade hub for clothing, household goods, construction materials, electronics and appliances, and produce. Last week, engineers said the goal is to restore “normal capacity” access to the main 700-foot-wide by 50-foot-deep channel and the Port of Baltimore by the end of May.
Aaron Roth, a retired Coast Guard captain and Chertoff Group principal, previously told CNBC there will be one tell-tale sign of when the channel is ready to open.
“Once you see plans of moving the Dali away from the port, that’s when you know the channel is ready to be open,” Roth said. “In the meantime, just like we saw with the Red Sea, the system will adjust. The economy knows best and the economy will absorb it,” he said.
The new channel is currently open for smaller commercial vessels, including those involved in the recovery effort, that are remarkably lighter and smaller. The size of vessels the Coast Guard is allowing is 96 feet in length, compared to the 984-foot-long Dali, the vessel that struck the Francis Scott Key Bridge after losing navigational control and destroyed the key piece of infrastructure.
A tugboat pushing a fuel barge was the first vessel to use the alternate channel to bypass the wreckage of the bridge. The barge was carrying jet fuel for the Department of Defense first bound for Delaware’s Dover Air Force Base.
Here’s a key lesson for Financial Literacy month: Be real and study market history.
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