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Watch Daily: Rumble's Bitcoin Move and Its Implications

2024-11-26

In the dynamic world of finance and technology, Rumble, a video platform with a focus on conservatives, has made a significant move. Monday evening saw the announcement that Rumble will allocate a portion of its excess cash reserves to bitcoin and make purchases of up to $20 million in this cryptocurrency. This decision has sent ripples through the market.

Rumble's Bold Step into the Bitcoin Arena

Introduction to Rumble's Bitcoin Strategy

Rumble, a platform with a unique position among conservatives, has taken a bold step by venturing into the world of bitcoin. As stated by Chris Pavlovski, the chairman and CEO, "We believe that the world is still in the early stages of the adoption of bitcoin." This belief drives their decision to allocate a part of their reserves to this digital asset. Unlike traditional government-issued currencies, bitcoin is not subject to dilution through endless money-printing. This unique feature makes it an attractive option as an inflation hedge and a valuable addition to their treasury.

Moreover, Rumble aims to strengthen its ties with the crypto community by becoming the leading video and cloud services platform for them. This move not only showcases their commitment to the crypto space but also positions them as a key player in this evolving industry. With the popularity of Rumble among conservatives, this step is seen as a strategic one, potentially linked to Donald Trump's return to the White House.

Rumble's Position in the Crypto Market

Rumble's entry into the bitcoin arena puts it in the same company as MicroStrategy, which has been aggressively buying bitcoin since 2020. MicroStrategy's shares have seen a remarkable increase of more than 500% in 2024 and trade as a proxy for bitcoin. Tesla and Block have also previously made similar moves. This year, two smaller companies, Semler Scientific in May and Acurx Pharmaceuticals last week, have followed suit.

Rumble's stock has also performed well, with a nearly 63% increase this year and a 42% gain in the past year. This shows the market's recognition of their strategic move and the potential it holds. Bitcoin itself, which came close to the $100,000 milestone last week, retreated on Monday but is still expected to hit this mark before the year ends. It has more than doubled in 2024, highlighting the growing interest and potential of bitcoin in the market.

Implications for the Crypto Community

With Donald Trump's incoming administration expected to take a pro-crypto stance, Rumble's move is seen as a significant one. Investors are now keeping a close eye on the next big company that will start buying bitcoin. MicroStrategy's chairman and bitcoin evangelist Michael Saylor has already expressed his plans to pitch the board of Microsoft on his bitcoin treasury strategy.

The theme of crypto has broadened to the government level this year, with Sen. Cynthia Lummis (R-Wyoming) proposing a national strategic bitcoin reserve. This summer, Trump also mentioned a potential national bitcoin stockpile. These developments indicate the increasing importance and recognition of bitcoin at both the corporate and government levels.

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Stock futures witnessed a complex movement during overnight trading on Monday. The Dow Jones Industrial Average had closed at a new record, yet futures tied to it slipped 144 points or 0.3%. S&P 500 futures fell by 0.4%, and Nasdaq 100 futures dropped 0.5%. This shift in futures prices indicated potential uncertainties in the market.

CEO Resignations and Market Reactions

Kohl’s, a prominent retail company, saw its shares drop more than 4% in overnight trading after announcing that its CEO would be stepping down in January. This news had a significant impact on the stock’s performance, highlighting the sensitivity of the market to such leadership changes.

Impact of Trump's Tariff Announcements

President-elect Donald Trump’s call for a 25% tariff on products from Mexico and Canada, along with an additional 10% levy on Chinese goods, sent ripples through the market. He had already proposed imposing a tariff of up to 20% on all imports and an additional duty of at least 60% on Chinese products. These tariff announcements raised concerns among investors about the potential impact on global trade and the economy.During regular trading, the 30-stock Dow popped roughly 440 points or about 1% to a new record close. The S&P 500 gained 0.3% to notch a new all-time intraday high, while the Nasdaq Composite edged up about 0.3%. The Russell 2000 hit a new intraday high, its first record since 2021, as investors piled into small caps. This rally in stocks was fueled by President-elect Donald Trump’s new Treasury secretary pick, which helped refuel the belief that the post-Trump election rally was back in full gear following a brief breather.

Treasury Yields and Market Sentiment

Treasury yields fell as investors lauded the choice of Key Square Group founder Scott Bessent to lead the Treasury department. Many investors view the hedge fund manager as a champion of financial markets and the economy given his background, and as someone who could potentially counteract some of Trump’s aggressive trade aspirations. “These policies may take more time to play through into the market actually get enacted,” NewEdge chief investment officer Cameron Dawson told CNBC’s “Closing Bell” on Monday of potential new policies from the Treasury pick. “It’s definitely a question mark of how much impact he can have in the short run as we round the year.”The U.S. market is closed Thursday for the Thanksgiving holiday and set to close early Friday, with volume expected to remain light. Ahead of the holiday, investors are looking ahead to October’s personal consumption expenditure price index.

Rumble's Bitcoin Treasury Strategy

Rumble, a video platform focused on conservatives, announced on Monday evening that it will begin allocating a portion of its excess cash reserves to bitcoin and making purchases of up to $20 million in the cryptocurrency. Shares rose 2% in extended trading. This move puts Semler in the same company as MicroStrategy, which began employing an aggressive bitcoin-buying strategy in 2020 and has primarily traded as a proxy for the crypto’s price since then. That stock is up more than 500% this year. Meanwhile, bitcoin has gained 118%.

Stocks on the Move during Overnight Trading

Here are the stocks on the move in extended trading:Zoom Communications, the maker of video calling software, is lower by 4%. Zoom topped Wall Street quarterly estimates and posted fiscal fourth-quarter adjusted earnings per share guidance that was roughly in line with estimates.Kohl’s, the retail stock, dropped 3% after announcing its CEO would step down in January. Ashley Buchanan, who currently leads crafts store owner The Michaels Companies, is set to replace current CEO Tom Kingsbury.Agilent Technologies, shares slumped 1% after the laboratory equipment company issued adjusted earnings guidance for the full year and current quarter that fell short of Wall Street’s estimates, per LSEG.Stock futures opened slightly higher on Monday. Futures tied to the Dow Jones Industrial Average added 45 points or 0.1%, while S&P 500 futures and Nasdaq 100 futures each rose about 0.15%.