Day: July 30, 2018

Bitcoin bulls could make a strong comeback if prices find acceptance above the key resistance at $8,300.

CEO of ADVFN, Clem Chambers, thinks that devaluation of the Chinese yuan (CNY) due to a growing trade war between the United States and China is the real reason for the July 2018 Bitcoin rally.

The Bitcoin bear market has abruptly reversed into a rally during the latter half of July 2018, with Bitcoin’s price increasing from USD 6,100 to as high as USD 8,500. Many experts and speculators thought this rally was in anticipation of the approval of the first Bitcoin exchange traded fund (ETF) by the United States Securities and Exchange Commission (SEC). However, the SEC rejected the Winklevoss Bitcoin Trust ETF and thoroughly explained how they will not be approving any Bitcoin ETF anytime soon, yet the Bitcoin market barely reacted. As of this writing on 29 July 2018, after the ETF rejection news has had days to sink in, the price of Bitcoin is hovering above USD 8,200.

Chambers says Bitcoin is the new gold but far better. Like gold, Bitcoin can be used as a safe haven investment when fiat currencies are losing value. Unlike gold, Bitcoin can be purchased instantly, held on a computer, sent anywhere in the world instantly, and then converted back to fiat instantly. This whole process can be practically invisible with Bitcoin, whereas with physical gold the process is cumbersome and risky.

The Bitcoin rally occurred two days before a devaluation of the CNY, and Chambers believes this was insider trading. Even though CNY to Bitcoin trading is banned, it is still easy to do due to the decentralized and worldwide nature of Bitcoin.

The exchange rate of the CNY to USD has declined from 0.156 to 0.147 (7%) since June. This is due to the growing trade war between the United States and China which has seen hundreds of billions of dollars of tariffs issued. Devaluing the CNY is a mechanism by which the People’s Bank of China can gain an upper hand in the trade war, since it increases the trading surplus with the United States, increasing the impact of Chinese tariffs against the United States. Simultaneously, CNY devaluation is accomplished with massive amounts of money printing, which swells China’s treasury.

Chambers told Forbes that if the trade war goes into “meltdown” then Bitcoin’s price will “moon”. Based on this logic, Bitcoin investors should keep an eye on news about the trade war and the CNY/USD exchange rate, since it might have a bigger impact on Bitcoin’s price than anything else at this point.

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While you may not have heard of him, Olaf Carlson-Wee has joined the ranks as one of the foremost crypto entrepreneurs, managing a $1 billion crypto-centric investment fund.

From Lumberjack To “Crypto OG”

Olaf Carlson-Wee’s passion for cryptocurrencies started at a young age, as the now 28-year-old wrote his college thesis on Bitcoin. While his professors were skeptical of this seemingly outlandish decision, his admiration for the technology behind the crypto asset remained. In an interview conducted in 2017, Carlson-Wee gave Vice journalists some insight on what sparked his interest for this space. He stated:

“In June 2011, a somewhat historic article came out on Gawker that was on Silk Road, but it talked about this technology Bitcoin… I thought it sounded really interesting so I started reading more about Bitcoin and just went down the veritable rabbit hole. I was going into my senior year of college and was still just really really obsessed with this concept.”

Following his time at college, the graduate put Bitcoin to the side, working all across America as a lumberjack. Despite seeming to have no qualms with the lumberjack experience, his affection for Bitcoin and Blockchain persisted, as he eventually made his way to Oakland, where he became the first hired employee at Coinbase. At the now established cryptocurrency platform, which was a non-descript startup at the time, Carlson-Wee took 100% of his salary in Bitcoin, bringing the concept of “skin in the game” to the highest level.

Speaking on what kept him in this industry, he later added:

“I came into school in 2008 in the financial crisis. I think I have always been a little bit skeptical of the kind of blind trust that people have in financial systems… although it’s (crypto) technically complicated, it’s fully transparent how it works. If you ask someone how the Federal Reserve works, I think its a much more complicated question actually… The reality is we’re dealing with a breakthrough technology that we haven’t seen like so since the internet.”

Carlson-Wee recently took to CNBC Africa’s Crypto Trader show, to speak with Ran Neu Ner about his time as a full-time “Crypto OG.”

After working for three years as the Head of Risk at Coinbase, the expert began to take notice of the altcoin industry, specifically with the launch of Ethereum. Speaking with Ran, the investor brought attention to his ideas regarding a so-called “multi-blockchain” industry:

“Through a lot of conversations with him (his colleague and friend) I became interested in the idea that the crypto space becomes multi-blockchain. To give you the backdrop, in early 2016, Bitcoin represented about 90 to 95% of the market share of all cryptocurrencies.”

Polychain CEO Explains The Growth From $4 Million To $1 Billion Under Management 

After seeing the innovation present on the growing platform, nearly one year after the launch of the Ethereum network, Carlson-Wee decided to launch a new cryptocurrency fund. As he later explained, he wanted to formulate an investment strategy that was centered around investing in the altcoin space, which only accounted to 5 or 10% of the entire crypto industry at the time.

Olaf fittingly named the fund “Polychain,” which immediately attracted investors from family offices, angel investors and “other people that I didn’t know before.” As the PolyChain CEO went on to note, the fund started operations with $4 million in assets under its belt and has since grown precipitously in value. The from $4 million to over $1 billion has been widely attributed to a growing list of investors allocating funds to the firm, along with the firm’s investments rising greatly in value.

When queried about what other factors resulted in the firm’s gargantuan run-up, the CEO noted that it had been a “long and arduous journey,” with such a feat being no small task. However, Olaf went on to say that he grew the fund by doing what he knew how to do, putting it as short and sweet as just “investing in cryptocurrencies.”

He also pointed out that he had the prerequisites required to properly manage cryptocurrency investments, alluding back to his time at Coinbase as a Product Manager and the Head of Risk by stating:

“So I had a long history of all of the core things that you need to set up to run a fund like this. I had been doing these at Coinbase or personally for many years. I think I was well-positioned to manage these investments and start investing in new things. But really, a lot of what I spend my time doing is talking to early-stage teams, so people who are dreaming of some new and wild technology  and often they are very talented technical architects who want to make this a reality.”

As a direct result of his success at Polychain, he has recently joined the ranks of Fortune’s “Ledger 40 Under 40,” which highlights powerful players in the cryptosphere. It is likely that Carlson-Wee’s expertise will only bring fortune to those around him in the future, so keep your eye out for Polychain Capital and its CEO, Olaf Carlson-Wee.

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Misthos’ new multi-signature bitcoin wallet for businesses aims to empower workers and democratize the setting of wages.

There has been a large amount of enthusiasm in recent months across the crypto space that the United States Securities and Exchange Commission (SEC) would approve a Bitcoin exchange traded fund (ETF), which would effectively put Bitcoin on the stock market, and make it easy for institutional investors to buy Bitcoin on all the major stock trading platforms.

However, these hopes were shot down when the SEC rejected the Winklevoss Bitcoin Trust ETF in a 92-page document detailing how the underlying Bitcoin market was not mature or safe enough to approve any Bitcoin ETF. This is combined with the revelation that the VanEck SolidX Bitcoin ETF, which is similar to the Winklevoss Bitcoin Trust, can have its decision delayed until 2019. One of the SEC commissioners who voted on the ETF, Hester Peirce, has issued a dissenting opinion that the SEC made the wrong choice, overstepped its bounds, and didn’t do its job.

SEC commissioner Peirce says, “The Commission’s action today deprives investors of this choice. I reject the role of gatekeeper of innovation—a role very different from (and, indeed, inconsistent with) our mission of protecting investors, fostering capital formation, and facilitating fair, orderly, and efficient markets. Accordingly, I dissent.”

Additionally, Peirce argues that approving a Bitcoin ETF would have created a channel for transparent and regulated investment into Bitcoin, which would protect investors. Not approving the ETF would ultimately keep investments outside of properly regulated channels and harm Bitcoin investors. This is quite the opposite of SEC’s mission to protect investors.

The SEC rejected the Winklevoss Bitcoin Trust based on the dynamics of the underlying Bitcoin market, not on the merits of the ETF itself. Peirce says that the ETF would have been able to follow all of the SEC rules and regulations to ensure lack of market manipulation and that it wasn’t appropriate for the SEC to reject the ETF based on the underlying market.

Winklevoss Bitcoin Trust had a surveillance agreement in place with the Gemini exchange, which Peirce thinks is sufficient because the ETF’s price would have been based on Gemini’s Bitcoin spot price. The SEC demanded surveillance agreements with larger Bitcoin exchanges outside of the United States, which is impractical and not necessary. According to Peirce, the SEC analyzed the Bitcoin market with methods used to analyze other commodity markets that are fundamentally much different, which is inappropriate.

The SEC left the door open for the approval of a Bitcoin ETF in the future if the Bitcoin market matures. Peirce thinks the SEC is slowing down the maturation of Bitcoin by keeping institutional investors out of the market.

The SEC commissioner sees that Bitcoin has numerous unique characteristics that make it worthy of being an investment mechanism, including its electronic nature which facilitates transparency and competition. Bitcoins are interchangeable so investors always get the same thing when they purchase it, and Bitcoin mining is worldwide, insulating it against geopolitical threats, unlike other commodity markets which can be damaged and manipulated by a single country.

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FOMO Moments

Markets are flat this morning with few coins moving; ChainLink doing well but Aelf, TenX and Bitcoin Gold suffering.

As we start another working week crypto land remains flat after a weekend of inactivity across the markets. There have been virtually no movements in total market capitalization which remains under $300 billion.

Bitcoin hasn’t moved at all and is still trading at $8,160 where it was this time yesterday. Likewise with Ethereum which is trading at $465, the same level as the weekend. Altcoins are mostly in the red but by very small amounts, the top ten is pretty much the same as yesterday. Stellar has fallen back the most once again with a 4% decline to $0.30. Over the week XLM is still up 3.5% since last Monday.

The top twenty is also red at the moment with all coins in decline aside from Ethereum Classic which is up 1.6% to $17. The biggest loss is from Binance Coin which has dropped 5.8% to $13.60 followed by Monero which is down 4.4% to $135. The rest are losing between 1-2% at the moment.

Further down the list the losses are greater with over 5% declines for 0x, Zilliqa and Bitcoin Gold. Icon however is in the green by 2.6% to trade at $1.33. ChainLink is the top performing altcoin at the moment with a climb of 6.8% to $0.342. At the opposite end of the crypto spectrum is Aelf which has dropped 10% followed by TenX down 8%.

Markets are poised for another movement over the next couple of days. Total capitalization has not changed in the past 24 hours and remains just below $295 billion at the time of writing. Since last Monday crypto markets have gained a marginal 2.7% and are still up trending slightly since mid-July. Trade volume is currently at $13.5 million which is slightly higher than this time yesterday.

A further upswing will take markets over $300 billion and Bitcoin to its next major resistance level near $9,000. More bearish selling though could see things go back to the lows earlier this month.

FOMO Moments is a section that takes a daily look at the top 25 altcoins during the current trading session and analyses the best performing ones, looking for trends and possible fundamentals.

The post Cryptocurrency Market Update: Waiting For Signals on a Flat Monday appeared first on NewsBTC.

Fatfish Internet Group CEO Kin-Wai Lau is bullish on both Bitcoin prices and ETFs

Lately, we witnessed an episode of confrontation between supporters of different approaches and views on centralization and decentralization. Ethereum’s co-founder, Vitalik Buterin, in an interview with TechCrunch, spoke for complete decentralization, saying he hopes centralized exchanges go “burn in hell.” According to him, The Ethereum Foundation tries very hard to be a decentralized organization, but it faced a challenge in a decentralized user authentication implementation. Buterin remarked, that if all user authentication methods wound up, they’d use Coinbase, but they’d prefer not to. In his view, the primary purpose of centralized exchange is to serve as an interface between the fiat world and cryptocurrencies. While it’s still early days for crypto-to-crypto exchanges, generally, he thoroughly disapproves centralization.

On the other hand, Changpeng Zhao, CEO of Binance – currently the world’s second largest cryptocurrency exchange, by means of 24-hour trade volume, disagrees with Vitalik. On Twitter, he answered Buterin’s complaints. Zhao suggested Vitalik appreciate the fact that centralized exchanges are part of an ecosystem, not independent parties. According to his tweet, fiat had a significant impact on the development of decentralized digital coins. If it wasn’t because of fiat currency and centralized exchanges, the liquidity would have been lesser and the scale of the industry would have been smaller.  Zhao noted that people choose centralized solutions for a number of reasons. Among them is the fact that there’s no absolute decentralization, projects having a core team means there’s still an element of centralization. He also pointed out that decentralization is not safer by default, and reminded everyone about the situation involving Ethereum Classic and the Ethereum DAO. In that situation, the decentralized organization suffered because of a security problem which led to a hard fork on the original network. Zhao noted that the primary goal isn’t decentralization itself but freedom and keeping options open.

This conflict of opinions shows the differing perspectives between centralized exchange and decentralized exchange supporters. Supporting decentralization is a sort of a fad nowadays. People either equate decentralization to complete freedom without a deep understanding of how it really works or speculate on the idea just because “decentralization” sounds hype. But is decentralization of exchanges better in reality? Let’s take a look.

Decentralization is Not the End Goal

When comparing centralized exchanges and their decentralized counterparts, it becomes fairly evident that most cryptocurrency exchanges cannot compete with more traditional equity trading platforms in terms of speed of execution, sophistication of order management, quality of API, efficacy of risk control, etc. Decentralized platforms provide direct exchange between transacting participants, meaning they bring in no profits, hence, their growing opportunities are considerably limited. Their trade mechanisms are usually slow and they don’t offer so many market tools. Centralized exchanges, on the contrary, provide a more significant number of market tools and their performance is usually more stable.

It’s a bit paradoxical, but for those who value safety, centralized exchanges are the better choice. Many of today’s popular exchanges lack the most basic licenses and haven’t been audited by internationally recognized agencies. While the ideals of freedom and independence are a driving force in the crypto community, such an approach also results in a growth of manipulative trading tactics and requires too much trust for an industry that is meant to be trustless. Licensing is essential for any business involved in trading digital assets.

Decentralized blockchain solutions are expensive and difficult to develop. The blockchain doesn’t give its processing power for free; each operation requires a fee. If developers create a smart contract that performs 20% better, it results in a 20% higher fee.  At the same time, there are centralised exchanges that work without fees and remain profitable. Decentralised exchanges have no other means of generating revenue and would be at a loss if they had taken this approach.

On decentralized exchanges, the speed of trading is slower. The blockchain is merely a chain of machines located all over the world and a ping inside of it is slower than a ping to a server or even to a group of servers. It may not be crucial for ordinary traders, but it is for high-frequency trading (HFT) which at this time can only be implemented on traditional centralized exchanges.

Hybrid Solutions: Taking the Best from All Technologies

As always, both centralized and decentralized exchanges have advantages and disadvantages, and the choice would depend on traders’ needs and requirements. Nowadays a new form of hybrid exchanges are showing up. Such exchanges can be called semi-decentralized: they prefer high performance to full decentralization and also use the blockchain only when necessary, opting for centralized solutions elsewhere; this helps to decrease development and operating costs.

“Hybrid semi-decentralized exchanges take best from both centralized and decentralized solutions and aim to solve their typical problems. Hybrid exchanges are working to make their solutions transparent and trustful but don’t follow the hype trends blindly. For instance, the blockchain is an ultimately useful technology for some cases, but it is enormously expensive to use, especially when dealing with large chunks of data. So it’s wise to choose the blockchain when it is crucial and opt for cheaper centralized solutions when possible” – says Rayan Goutay, CTO Gatex – an upcoming professional hybrid semi-decentralized exchange.

How Exchange Listings Affect Token Prices

Exchanges are needed not only as a trading facility; they’re essential for the success of new digital coins. The cryptomarket is still considerably young and volatile, new coins show up constantly, and many of them never get in front of investors because they fail to get listed on exchanges. Moreover, listing on top international digital asset exchanges usually results in a price boost for the cryptocurrency as when a token is listed on an exchange, the number of interested investors increases. Furthermore, the asset becomes more liquid and the intrinsic value is greatly affected. The effect of exchange listing is most visible right after, but it has a positive impact for the long-term perspective: the more the coin is before the public, the higher its value will be in future.

The positive effect of exchange listings is augmented with an additional trust which a community gives to a digital coin. The wider the project’s community, the more the credibility it gets. As a result, the better its proper asset looks on a global economic level. New coins appear frequently, and one of the primary challenges for developers is to build a well-informed community and have loyal users. Here is when the role of exchanges cannot be overestimated.

The post When is Centralization Helpful in the Decentralized World? appeared first on NewsBTC.

Key Points

• Bitcoin price is holding an important support at $8,000 against the US Dollar.
• There is a significant bearish trend line in place with resistance at $8,300 on the hourly chart of the BTC/USD pair (data feed from Kraken).
• The pair must clear the $8,300 barrier to resume its upward move above the $8,500 level.

Bitcoin price is consolidating gains above $8,000 against the US Dollar. BTC/USD could trade to new a monthly high if it succeeds in settling above $8,300.

Bitcoin Price Analysis

After declining below the $8,000 level, bitcoin price found support near $7,800 against the US Dollar. The BTC/USD pair trimmed most its losses and traded back above the $8,000 level. There was even a break above the 50% Fib retracement level of the last drop from the $8,503 high to $7,800 low. The price settled above the $8,100 level and the 100 hourly simple moving average.

However, the upside move was capped by the $8,300 resistance. More importantly, there is a crucial bearish trend line in place with resistance at $8,300 on the hourly chart of the BTC/USD pair. The same trend line is close to the 61.8% Fib retracement level of the last drop from the $8,503 high to $7,800 low. Therefore, a successful close above the trend line and $8,300 resistance may perhaps open the doors for more gains. BTC price could jump towards the $8,500 high. Above this, the price will most likely accelerate gains above $8,550 and form a new monthly high.

Looking at the chart, the price is struggling to clear the $8,300 barrier. Should there be a downside reaction, the $8,100 and $8,000 supports levels could be tested. Below $8,000, bitcoin may possibly face an increased selling pressure.

Looking at the technical indicators:

Hourly MACD – The MACD for BTC/USD is slowly moving back in the bearish zone.

Hourly RSI (Relative Strength Index) – The RSI is currently moving lower towards the 40 level.

Major Support Level – $8,000

Major Resistance Level – $8,300

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