Crypto Winter Survivor: Inside Nvidia’s Difficult Relationship With Mining

U.S. hardware manufacturer Nvidia reported full-year revenue gains in 2018.

On Feb. 14, California-headquartered gaming and computer hardware manufacturer Nvidia reported full-year revenue gains in 2018, despite being one of the companies worst hit by the cryptocurrency market dip and subsequent lack of demand for mining components.

The firm’s main products include graphics processing units (GPU), among others, which became widely purchased by miners during the crypto boom of 2017 — as a result, the firm’s revenue started to correlate with the crypto market condition (at least to some extent), which resulted in a few shake-ups.  

Company profile / NVIDIA

2017: Nvidia enjoys the crypto boom, becomes substantial part of the market

In 2017, its primary GPU product line, labeled "GeForce" — as well as its direct competition, Advanced Micro Devices' (AMD) "Radeon" units — began surging in price as the crypto frenzy unfolded and Bitcoin (BTC), along with altcoins, gained mainstream recognition. That year, according to Jon Peddie Research, a market research firm for the computer graphics industry, miners purchased around 3 million devices for more than $700 million. As a result, Nvidia inadvertently became one of the market’s most significant players.

Graphics Cards Market Shares

The ever-increasing demand for mining equipment lead to higher prices: As Cointelegraph previously reported, the cost of flagship chips rose by 25 percent, with Nvidia’s GeForce 1080 being sold for more than $1,000 during the market peak, while it normally retailed for $550. According to media reports, Nvidia even started limiting its online sales to avoid excessive resell, allowing customer to buy no more than two items per person.

The company’s seniors greeted the sudden increase in sales caused by the rapid growth of an emerging market. In August 2017, while talking to MarketWatch, Nvidia CEO Jensen Huang appeared notably bullish about the crypto industry:

“Crypto is here to stay, and the market will grow to be quite large. [...] It’s not likely to go away any time soon. There will be more currencies to come, they will come from different nations. [...] We stay very close to the market, and understand the dynamics very well.”

In May 2018, Nvidia shared information about its revenue from chip sales to the crypto mining market for the first time. Specifically, the manufacturer reported earning as much as $289 million from processor sales to miners. Essentially, Nvidia was growing along with the market: The firm’s first-quarter crypto sales that year amounted to over 9 percent of overall revenue for the company, which stood at $3.2 billion.

“Crypto miners bought a lot of our GPUs in the quarter and it drove prices up,” the company’s CEO reportedly explained on the conference call, adding, however, that high prices prevented other consumers, such as gamers, from buying into the newest GeForce graphics card series.

First half of 2018: Crypto market plunges, Nvidia GPUs decline in price

However, by that time, Bitcoin had long entered its notorious nosedive — in January alone, the cryptocurrency lost half of its value from the $20,000 landmark high — and Huang wasn’t as optimistic about the market anymore. The sales to the crypto market would likely decrease by two-thirds in Q2 2018, the company forecasted.

“In the beginning of the year, we thought and projected crypto would be a larger contribution through the rest of the year, but at this time we consider it to be immaterial for the second half,” Huang told MarketWatch at the time.

Indeed, as Cointelegraph reported, revenue for miners had decreased, as the crypto market underwent a correction following record highs in December 2017. Hash rates were still growing, however, indicating that the mining pool continued to expand globally.

Hash Rate and Miners' Return in 2018

In August 2018, the hardware developer declared that crypto mining sales in Q2 were even lower than expected. Nvidia began to dismiss the once profitable market, arguing that it does not expect to make significant mining-related sales for the rest of the year. Colette Kress, the company’s chief financial officer, stated:

“Our revenue outlook had anticipated cryptocurrency-specific products declining to approximately $100 million, while actual crypto-specific product revenue was $18 million. Whereas we had previously anticipated cryptocurrency to be meaningful for the year, we are now projecting no contributions going forward.”

Nvidia also forecasted its third quarter revenue between $3.19 billion and $3.32 billion, lower than the figure predicted by analysts of $3.34 billion. As a result, the manufacturer’s shares declined more than 5 percent.

In July 2018, media started to report that the price of specialized GPUs has been declining along with sinking prices in digital currency markets. Thus, according to Computerworld, in April 2018, AMD’s OEM 4GB RX 580 six-pack was sold out at the price of $3,600, while in July, it was available for just $2,500. Respectively, an Nvidia GeForce GTX 1080 Founders Edition, 8GB GDDR5X PCI Express 3.0 Graphics Card was sold out at a price tag of $1,050 in April, but could be purchased for $709 around July.

Video Cards Prices Over Time

Second half of 2018: ASIC’s takeover, Nvidia experiences “crypto hangover”

Meanwhile, application specific integrated circuits (ASICs), a special type of computer chip that is designed solely for cryptocurrency mining, had been developed for a number of cryptocurrencies, outperforming GPUs. The largest company to ride the ASIC wave was the China-based Bitmain company, which was eventually also severely hit by the bear market. Nevertheless, the outfit began selling devices that mined non-ASIC-resistant cryptocurrencies much more efficiently than GPUs, hence partially forcing Nvidia out of mining, especially within the BTC blockchain.

Nevertheless, some cryptocurrencies can still be mined only with GPUs, says Mark D’Aria, founder and CEO of Bitpro, a New York-based installation and mining operation management firm:

“It is unlikely that Bitmain can drive Nvidia *completely* off of the market – they can certainly drive Nvidia GPUs mostly out of mining certain coins, but there are many ASIC resistant coins out there, and it would be extremely beneficial for Nvidia (and AMD) if Ethereum goes through with the ProgPoW update.”

The target markets of Nvidia and solely crypto-oriented players like Bitmain are completely different, agrees Jonathan Bertrand, president of Technologies D-Central, mining equipment provider located in Quebec, Canada:

“Bitmain's performance is closely tied to the performance of cryptocurrency while Nvidia has a wide range of markets such as gaming, AI and hash functions more general, it is not only mining operations that are hashing. Nvidia cards are excellent for the vast majority of hashing operations needed in the world, far more than an ASIC that has a single use. Not to be confused, the unique use of an ASIC is very useful, but strictly in the case of Bitcoin mining.”

Further, on Nov. 15, Nvidia released its earnings report for the Q3 of 2018. In the report, Huang revealed that the company’s “near-term results reflect excess channel inventory post the cryptocurrency boom, which will be corrected.”

Basically, while the crypto frenzy increased prices for Nvidia’s gaming cards, once that demand vanished, prices did not decrease quickly enough to attract customers who were waiting for more affordable cards. The CEO referred to this period as a “crypto hangover” in an interview with Reuters:

“The crypto hangover lasted longer than we expected. We thought we had done a better job managing the cryptocurrency dynamics.”

Nvidia’s post of sales for Q3 missed expectations yet again, and the company’s shares dropped another 17 percent. Around the same time, Goldman Sachs removed Nvidia from its list of stocks with the most potential for investors. “We were clearly wrong on the stock as we underestimated the magnitude of the channel inventory build in midrange gaming GPUs,” its analysts explained. Thus, Wall Street’s crypto-driven expectations from the hardware developer were not met.

In December, CNBC reported that in Q4 2018, Nvidia experienced a massive sell-off of its shares, cutting the stock price by 54 percent, which made it the worst performer in the S&P 500. Later that month, Nvidia even faced a class-action lawsuit over its losses. Specifically, the complaint filed by Schall law firm stated that “the Company made false and misleading statements to the market” and “touted its ability to monitor the cryptocurrency market and make rapid changes to its business as necessary.”

2019: Weak sales are likely to continue. However, the company will carry on regardless of crypto

In January 2019, Nvidia updated its financial estimates for Q4 for the fiscal year of 2019, reflecting weaker forecasted sales in its gaming and data center platforms, explained by excess midrange channel inventory following the slump in crypto market. The revenue for that quarter was now expected to be at $2.20 billion, opposed to the previous projection of $2.70 billion.

NVIDIA Revenues' Estimates

Jensen Huang said in the press release:

“Q4 was an extraordinary, unusually turbulent, and disappointing quarter.”

In addition to a lack of crypto-related business, Nvidia also cited “deteriorating conditions” in China as a indicator of lower-than-expected revenue from gaming GPU sales in Q4.

Finally, in February 2019, the United States hardware firm reported full-year revenue gains after publishing its Q4 earnings. According to the press release, its total 2018 revenue climbed 21 percent from 2017 numbers to $11.72 billion, even despite the crypto market crash. The growth was allegedly driven by all-time high sales of its gaming, data center, professional visualization and automotive products.

As a result, Nvidia’s shares jumped 8 percent after the figures were unveiled. Q4 performance turned out to be extremely low, however: Revenue was down 24 percent versus the same quarter the previous year to $2.24 billion, staying just slightly above the adjusted forecast.

Commenting on the statistics, Nvidia’s CEO stressed the market’s infamous volatility:

“The combination of post-crypto excess channel inventory and recent deteriorating end-market conditions drove a disappointing quarter.”

D’Aria of Bitpro was not surprised by those numbers, arguing that Nvidia is not that depended on its performance within the crypto market. He told Cointelegraph:

“Crypto mining was never the foundation of Nvidia’s revenue, more like a cherry on top. During the 2017 bull run it was a really big cherry, but Nvidia is one of the most innovative chip makers and they are completely dominating their competition in gaming, AI, scientific compute, etc. If crypto went away entirely, Nvidia would be just fine.”

He adds, however, that 2019 might not be as bleak for the hardware developer, especially if the market recovers enough to make GPU mining profitable again, and large projects such as Ethereum (ETH) adopt ASIC resistance measures, making more room for GPUs over ASICs. However, the frenzy times might be over for at least another few years, D’Aria warns:

“Nvidia has strong ProgPoW performance, and since they also lead AMD in general power efficiency with their latest GPUs, those two factors would definitely increase crypto mining’s contribution to their revenue, at least compared to the tail end of 2018. It’s unlikely we’ll see a return to the bonanza of late 2017-early 2018 without a another bubble, but I don’t expect that for a few more years. When that does eventually come around again, Nvidia will undoubtedly experience another huge few quarters, followed by another hangover a few quarters later.”

Similarly, D-Central President Jonathan Bertrand argues that Nvidia will stay afloat regardless of the market condition:

“I have confidence in the products of Nvidia and I am convinced that with the mining or not, the hash centers have the wind in the sails. It is the parallelization and specialization of traditional data-centers that drives us to the emergence of these new ‘hash-centers’ specialized in computing.”

Meanwhile, Bitmain has recently announced its next generation 7 nanometer ASIC mining chip, following a series of negative news caused by the crypto winter, suggesting that mining players are not giving up, but are patiently waiting for the spring to come.

Bitcoin (BTC) Resurgence, Adoption and Regulator Shift Likely Triggers

 

  • Bitcoin prices up 8.3 percent in the last week
  • Adoption levels could be pumping prices
  • Transaction volumes on the rise

 

Good news is bulls are back. Even with increasing prices, investors and traders have their eyes set on adoption trends. Encouragingly, adoption is on the rise, and now that our previous Bitcoin (BTC) trade plans are live, odds are the next wave of bulls will drive prices towards $6,000.

Bitcoin Price Analysis

Fundamentals

There is an expansion. It seems like the precipitous rise and eventual fall of BTC prices did more good than bad. Yes, prices fell to record lows, and at some point, industry commentators, as well as traders, had strong fundamental reasons to believe that Bitcoin–will despite the fanfare drop, to $3,200 and sub-$2,000 levels.

However, that has not been the case. It’s a recovery, and as prices bottom up, Bitcoin is surely and methodically matching towards its ultimate objective of being a global reserve currency. Skeptics may call this a pipe dream but when we factor in the cyclic nature of prices, the enormous strides made in the last decade and the ballooning fundamentals factors, there is a strong case to argue that Satoshi’s dream wasn’t narrow.

Aside from price action, we note that regulators are thawing to the idea of BTC and the more open up their tax lines partnering with crypto payment processors as BitPay, demand for the coin will keep swelling. Add that to developments like Trading View shifting away from fiat and denominating their premium plans in BTC and Domino’s Pizza accepting BTC via the ever-growing Lightning Network, Bitcoin medium of exchange capability is revealed.

Candlestick Arrangement

Bitcoin

Compared to other coins, BTC is under-performing. At spot rates, the currency is changing hands at $4050–data streams from BitFinex and up 8.3 percent in the last week. It may appear, but Bitcoin (BTC) price swings usually have a magnifier effect on altcoin prices.

Because our trading plans as laid out in previous BTC/USD price analysis are now valid, and prices are trending above $3,800 minor resistance and buy trigger line at the back of decent, above average volumes, risk-off traders can fine-tune entries in lower time frames.

That means every price dip is technically a buying opportunity with the first target at $4,500. On the other hand, risk-averse, conservative type of traders can wait for high-volume expansion above $4,500. From candlestick arrangements and Fibonacci rules, odds are any break above $4,500 could finally thrust prices to $4,500–$6,000 zone.

Technical Indicators

Endorsing our outlook is Feb 18 bull bar. Volumes backing this rally is above average at 37k exceeding those of Feb 8 and that of Jan 10.

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Major Crypto Exchange OKEx Adds Four New Margin Trading Pairs

Third-largest cryptocurrency exchange OKEx has added 4 additional crypto assets pairs to its margin trading platform.

Malta-based cryptocurrency exchange OKEx has added four new crypto derivative pairs to its platform, according to a press release shared with Cointelegraph on Feb. 19.

OKEx, the third-largest crypto exchange by trade volume, has announced the listing of Bitcoin SV (BSV), QTUM, DASH and NEO against Bitcoin (BTC) or Tether (USDT) on margin with a 3x leverage option.

Last month, OKEx added seven new crypto derivative pairs to its platform, including Bitcoin Cash (BCH), Bitcoin SV (BSV), EOS (EOS), Ethereum Classic (ETC), Ethereum (ETH), Litecoin (LTC) and Ripple (XRP), as Cointelegraph reported on Jan. 3.

As Cointelegraph wrote on Dec. 4, the digital asset exchange OKEx had earlier launched a derivative product, dubbed a “perpetual swap,” that supports BTC/USD with up to 100x leverage. In January, the exchange noted that the newly added contracts would only support up to 40x leverage, as opposed to today’s press release noting a 3x leverage option.

Also in December of last year, Hong Kong-based cryptocurrency exchange Bitfinex launched margin trading for stablecoin Tether (USDT) against USD, as Cointelegraph reported on Dec. 22.

Earlier today, Cointelegraph wrote that major United States exchange and wallet Coinbase has acquired a blockchain intelligence startup, dubbed Neutrino, underlining that the new deal is aimed at helping add more cryptocurrencies and features to Coinbase services.

Fintech Company TrueDigital Appoints Former Bridgewater Associates Executive as CEO

New York-based True Digital announced the appointment of former Bridgewater Associates COO Thomas Kim as its new CEO.

New York-based fintech company TrueDigital Holdings (TDH) announced the appointment of former Bridgewater Associates chief operating officer Thomas Kim as its new CEO through a post on its website on Feb. 19.

Before his time at Bridgewater Associates, which had almost $125 billion assets under management in 2018, Kim worked at now-defunct global financial services firm Lehman Brothers in charge of the Townsend Analytics Electronic Trading franchise.

According to today’s post, Kim will manage TrueDigital’s existing initiatives, such as the launch of Bitcoin (BTC) swaps planned for this year. In January of this year, blockchain platform Qtum also announced that it was introducing Bitcoin atomic swaps to its mainnet infrastructure.

TrueDigital’s announcement states that TrueDigital launched Signature Bank’s blockchain-based payment infrastructure earlier this year, which was approved by the Department of Financial Services of New York (NYDFS) in December 2018.

The aforementioned payment platform also attracted a “significant number of institutions within the first 30 days of operation,” according to the announcement.

As Cointelegraph reported in March of last year, TrueEX — whose affiliate is TDH — partnered with a blockchain tech company led by Ethereum (ETH) co-founder Joseph Lubin, ConsenSys, to create a benchmark rate for the price of Ethereum.

In early December 2017, CBOE had launched the first Bitcoin futures contracts, with CME Group launching the second around a week later.

Coinbase Acquires Cryptocurrency Surveillance Company Neutrino

Coinbase Acquires Cryptocurrency Surveillance Company Neutrino

Coinbase has acquired the cryptocurrency surveillance company Neutrino, whose team will be joining the American exchange’s European operation. The Milan, Italy-based startup develops blockchain intelligence platforms for crypto companies as well as law enforcement agencies.

Also Read: Survey: ‘Blockchain’ Was Most Overrated Buzzword of 2018

Coinbase Acquires Neutrino

Coinbase, the San Francisco-based cryptocurrency exchange, announced on Feb. 19 that it has acquired Neutrino, which it described as a blockchain intelligence platform. The team of blockchain engineering and security experts will join the exchange’s workforce, and Neutrino will continue to operate as a standalone business based out of Coinbase’s London office.

Coinbase Acquires Cryptocurrency Surveillance Company Neutrino

“Blockchain intelligence is increasingly important in the crypto ecosystem, and is necessary to achieve our mission of bringing the open financial system to the world,” stated Varun Srinivasan, Engineering Director at Coinbase. “By analyzing data on public blockchains, Neutrino will help us prevent theft of funds from people’s accounts, investigate ransomware attacks, and identify bad actors. It will also help us bring more cryptocurrencies and features to more people while helping ensure compliance with local laws and regulations. Neutrino’s technology is the best we’ve encountered in this space, and it will play an important role in legitimizing crypto, making it safer and more accessible for people all over the world.”

Intelligence Platform for Law Enforcement Agencies

Neutrino was founded in 2016 by a team of cyber security specialists with over 30 years of experience in the field of technology exploitation and intelligence gathering. The company offers a platform specifically developed for companies operating in the cryptocurrency ecosystem. It promises to enhance AML/KYC checks and procedures by setting up customized “red flags” that involve checking the origin of incoming funds, verifying suspicious spending behaviors and more.

Coinbase Acquires Cryptocurrency Surveillance Company Neutrino

Neutrino has also developed a platform specifically for law enforcement agencies, built for criminal investigations and intelligence gathering. It allows investigators to follow the flow of specific coins and their interaction with exchanges, mixers and other services as well as to spot people buying and selling goods on darknet markets, how much they spent, what they bought and from whom. Supported cryptocurrencies it analyzes include BTC, LTC, ETH, BCH and USDT, with more promised to be coming soon.

What do you think about this acquisition of Neutrino by Coinbase? Share your thoughts in the comments section below.


Images courtesy of Shutterstock.


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Why Nasdaq’s Bitcoin Index is a Bigger Deal Than Most People Realize

On February 11, Nasdaq, the world’s second-largest stock exchange, launched Bitcoin and Ethereum indices to present accurate prices of the two leading crypto assets. Nasdaq’s Bitcoin Index a Likely Precursor to Crypto Investment Products According to cryptocurrency analyst Alex Ziupsnys, the introduction of the crypto indices of Nasdaq could lead to the approval of a wide range of investment vehicles in the long-term. The analyst said: “NASDAQ to add a bitcoin index on its platform. They are reading the writing on the wall and don’t want to get left behind. There is no stopping this. Adoption happens gradually right in

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CEO of Japanese Finance Giant SBI Vests His Crypto Industry Hopes in Ripple and R3

Yoshitaka Kitao is vesting his future hopes for crypto in Ripple and R3 technologies.

Yoshitaka Kitao, CEO and representative director of Japanese financial services giant SBI Holdings, has singled out Ripple (XRP) and blockchain consortium R3 as reasons to remain optimistic about the future of the crypto industry — bear market notwithstanding. Kitao made his remarks during an interview with Japanese crypto news outlet Coin Post on Feb. 18.

SBI Holdings is an active partner of Ripple via their joint venture, “SBI Ripple Asia,” established to promote the use of XRP in Asian financial markets back in 2016.

In his interview with Coin Post, Kitao underscored that the protracted crypto market slump is not to be thought of as an end to the industry, and that SBI has been working intensively to foster the adoption of XRP among financial institutions.

He affirmed that the real demand for the asset’s use in cross-border remittances and settlement is already underway and will continue to burgeon— pointing to Santander’s use of Ripple’s blockchain-powered xCurrent and RippleNet platforms for international payments as an exemplary, high-profile case.

Aside from predicting that Ripple’s still-fledgling market capitalization would eventually grow to be a global standard, Kitao also made positive remarks in relation to enterprise blockchain consortium R3 — of which SBI is a member, as well as reportedly being the largest outside shareholder — as well as the R3 Corda settlement platform.

Alluding to the now-resolved legal disputes between R3 and Ripple, Kitao said he had encouraged the two former ostensible rivals”to cooperate on a joint venture, and was bullish on the potential impact of “Corda Settler” — R3’s universal payment settlement platform, which unveiled XRP as its first supported crypto in December.

Among the rest of his wide-ranging remarks, Kitao said he judged the “temperature of institutional investors [in regard to crypto] to be extremely hot,” noting that surveillance and real-time data on the crypto markets are improving, as well as clearing services.

Kitao said he hoped that Japan would spearhead cryptocurrency regulation and act proactively ahead of other global markets, such as the United States. He noted that SBI was awaiting more legislative clarity from the Japan’s watchdog, the Financial Services Agency, before launching its own crypto fund for institutional investors.

As previously reported, the past couple of years have seen SBI pursue multiple ventures in the crypto sector, including its own exchange — VCTRADE — alongside a series of investments in businesses developing crypto infrastructure and services. It also has its own blockchain initiative S coin platform, which it trialed for retail payments in September 2018, integrating R3 Corda technology.

In January, SBI published its nine-month financial report, which identified the implementation of R3 and Ripple technologies as a major part of its strategy.

In October 2018, SBI and Ripple’s XRP-powered payments app, MoneyTap, went live for account holders at selected Japanese banks — with the eventual ambition of including a consortium of 61 institutions (representing over 80 percent of all of Japan’s banking assets) in the service.

Walmart Stock Surges on Blowout Earnings, Dow Ain’t Biting

The Dow and U.S. stock market were stuck in neutral on Tuesday despite a blowout earnings report from Walmart, a sign that traders were treading more cautiously ahead of a slew of macroeconomic indicators later in the week. Dow Struggles for Direction Wall Street’s benchmarks traded tepidly through the morning session, mirroring a relatively uneventful pre-market for Dow futures. The Dow Jones Industrial Average opened 34 points lower. It was last seen trading at 25,923.31, having gained 40 points, or 0.15%. The broad S&P 500 Index nudged up 0.1% to 2,778.003, having erased an earlier drop. Six of 11 primary

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Coinbase Neutrino Acquisition Reveals History Of Spying and Gov’t Data Selling

surveillance camera Coinbase

Cryptocurrency exchange Coinbase is facing an increasing publicity nightmare after it emerged the CEO of a company it took over sold private user data to governments.


Coinbase: Neutrino ‘Will Help Prevent Theft’

Announced February 19, Coinbase now owns Italian blockchain surveillance startup Neutrino, having acquired the company for an undisclosed sum.

“By analyzing data on public blockchains, Neutrino will help us prevent theft of funds from peoples’ accounts, investigate ransomware attacks, and identify bad actors,” engineering director Varun Srinivasan wrote in an accompanying blog post.

It will also help us bring more cryptocurrencies and features to more people while helping ensure compliance with local laws and regulations.

Neutrino’s staff will now relocate to Coinbase’s London office and will continue working as before without redundancies.

Neutrino CEO Worked For ‘First Police Spyware Sellers’

No sooner had Coinbase revealed the takeover did cryptocurrency industry participants immediately sound the alarm over Neutrino’s roots.

Giancarlo Russo, its CEO, previously worked as COO of HackingTeam, a Milan-based outfit with a scandalous reputation. Described by Verge as “the first sellers of commercial hacking software to the police,” HackingTeam’s spyware enables clients to engage in a huge number of surveillance activities.

These include the covert collection of emails, SMS messages, call history and address book data, as well as keystroke logging, phone tapping of Skype calls and even data about cryptocurrency wallet usage.

A further article in UK newspaper the Telegraph in 2015 saw the company’s founder David Vincenzetti confirm such capabilities were being sold to governments and other entities in 20 countries.

Social media commentators picked up the HackingTeam connection with the Coinbase acquisition, while others appeared to quickly catch on.

“[G]oodbye (Coinbase)… not interested in having my data, identity, and crypto ownership data served to every government agency on a silver platter,” CoinShares CSO Meltdem Demirors added in her own response.

As Bitcoinist reported, Coinbase has felt the pressure from elsewhere this month. In another questionable security move, the exchange now allows users to store the private keys to wallets in the cloud.

What do you think about Coinbase acquiring Neutrino? Let us know in the comments below!


Images courtesy of Shutterstock

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Ethereum (ETH) Price Analysis: Afri Quits, Will Bulls Fizzle Out?

 

  • Ethereum prices up 21.6 percent in the last week
  • Afri Schoedon quits Ethereum after Polkadot, Serenity comparison
  • Transaction volumes picking up

 

Compared to other coins in the top 10, Ethereum (ETH) is leading the bulls procession. Changing hands at around $150, we expect ETH bulls to gain ground ahead of Constantinople.

Ethereum (ETH) Price Analysis

Fundamentals

Blockchain-based projects are unique and special. A genuinely decentralized network will have a healthy mix of developers, investors, and speculators. All of them will contribute in one way or another. Everything else constant, the success or failure of a project depends on the number of dedicated developers. Afri Schoedon, the Ethereum core coder, was one of them. Due to online criticism, he announced his decision of stepping aside and in days ahead would “no longer respond on Gitter, Skype, Discord, Slack, Wire, Twitter and Reddit” directly to any member of public on technical questions or improvement requests regarding Ethereum.

In a tweet, the quitting Ethereum servant said:

 

“I did not quit social media, I quit Ethereum. I did not go dark, I just left the community. I am no longer coordinating hard-forks, building testnets, or contributing otherwise. I did not work on Polkadot, I never did, I worked on Ethereum. I did not hate Ethereum, I loved it.”

Critics started pouring thanks in part to his honest comparison on Thursday last week between Polkadot, a multi-frame network that supports interoperability between wildly different blockchains and Serenity, a scaling solution proposed by Ethereum.

Candlestick Arrangement

Ethereum

At the time of writing, ETH is up 21.6 percent in the last week. Despite Afri quitting, bulls are resilient, and prices are trending at new highs at the back of decent volumes. Although ETH is technically bearish unless of course prices breach the $170 ceiling, we shall retain a bullish outlook in days to come. It is easy to see why.

Firstly, ETH is up above the $135 resistance level, and in a minor breakout pattern, these upswings did confirm bulls of Feb 8 which in turn validate price gains of mid-Dec 2018.

Secondly, ETH found support at around the 78.6 percent Fibonacci retracement level, and as Fibonacci reversal rules dictate, ETH bulls will likely pump prices towards $170– a critical resistance level. Combined with fundamental reasons as Constantinople, we may see a situation where the march towards $170 will hasten.

Technical Indicators

There is a remarkable shift of momentum and as aforementioned, confirming price swells of Feb 18 are high volumes–520k, exceeding those of Feb 8–519k. While bullish, market participation levels are lower than those of Jan 10–684k. Therefore, it is imperative that ETH bulls surge above $160 for a complete reversal of Jan 10 losses in a three-bar bull reversal pattern as prices bottom-up from $100 pits.

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Donald Trump Just Got Snubbed by UK, Germany in Plan to Block Huawei from Global 5G Domination

Bad news for Donald Trump as Britain and Germany won’t be joining the United States in its crusade to crush Huawei’s operations, but they do need guarantees from the Chinese firm. It seems both countries are not interested in getting caught in the dispute between the U.S. and China. Washington and Beijing are fighting for something much more than just economic supremacy. The tensions have boiled over into a trade war that has continued to rage on till this day, with things set to get worse if the March 2 deadline for negotiations elapses and no resolution is reached by the

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‘Twitter is a Disaster’: CNN Expat Unloads after Reporter Exposed Dishing out Wardrobe Advice to Kamala Harris

A CNN national political reporter provided a glimpse of the cozy relationship between some members of the press and political elite Senator Kamala Harris (D-CA) in a Twitter video that has gone viral. We kind of forced @kamalaharris to try on this awesome oversized rainbow sequin jacket … She snapped it up. @alivitali perfectly named it as “the Mardi Gras Jacket” #2020 #SouthCarolina #CampaignFashionReport pic.twitter.com/2G0NFRkKL6 — Maeve Reston (@MaeveReston) February 16, 2019 The free press was hard at work holding US politicians accountable over the weekend. In an incident that occurred at a boutique fashion shop owned by a female

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Bitcoin Is Yet To Bottom Out, And Avoid Buying Ethereum: Hedge Fund Manager

The market has been on an uptrend in the past two days, gaining $14 billion. Bitcoin is on the cusp of hitting the $4,000 level for the first time in five weeks. Ethereum is trading just a dollar shy of $150, with EOS gaining 30 percent in the past two days. It finally looks like the market can make a rally, at least in the short term.

However, we shouldn’t be too quick to celebrate. According to one hedge fund manager, it’s likely that bitcoin is yet to bottom out. Alex Sunnarborg is the founding partner of Tetras Capital, a New York-based crypto hedge fund. In an interview with Forbes today, he revealed that he thinks bitcoin could still regress despite the recent rally.

Tetras Capital is most renowned for its bet against Ethereum in May last year. The fund shorted the currency back when its price stood at $700. The bet paid off for them, with Ethereum closing the year at $140. The firm is estimated to have $30 million in assets under management.

Sunnarborg believes that the currency is yet to bottom out. However, he admitted that calling the bottom is a Herculean task that even the most elite minds find difficult to do. It would be easier to call the bottom if everything had gone wrong, he explained saying:

It probably would have been helpful for the bottom if the VanEck exchange-traded fund would have gotten totally rejected; if the SEC slapped some more of these people around and essentially maximum pain came onto the market. At that point, we would see where, if any, buyers jumped in.

Ethereum Is In Trouble

Sunnarborg was even more bearish with Ethereum. The currency has bounced back to regain its “altcoin king” position from Ripple’s XRP and currently trades for $148. However, he believes that the currency is losing “steam and momentum.”

One clear signal of the loss in momentum is ConsenSys, the Joseph Lubin-led Ethereum incubator. In December last year, sources at the company revealed that it would lay off up to 60 percent of its staff. The layoffs came just three weeks after the firm laid off yet another 13 percent of its 1200 staff members.

While the decentralized applications on the Ethereum blockchain have gained great attention, it hasn’t translated into usage.

All the Ethereum decentralized applications and products it supports have had minimal user growth. A lot of them still haven’t launched and are still pretty difficult to use, and the daily active user counts are less than 100.

There is also an exodus by developers from Ethereum’s blockchain to its competitors including Polkadot and Dfinity. Sunnarborg, however, declined to state whether he believes Ethereum has bottomed out yet.

Speaking on what factors he considers before investing, he said the first is whether the project conducted an ICO. “We’re very biased against anything that did an ICO because we think they’re pretty much all illegal securities offerings,” he said. This leaves them with very few projects to invest in.

This is one of the reasons his hedge fund would never invest in EOS, he stated. “The one-year long, $4 billion-dollar ICO seems a little excessive to me,” he stated. He also criticized the governance structure which he believes isn’t as decentralized as it should be.

 

Image(s): Shutterstock.com

The post Bitcoin Is Yet To Bottom Out, And Avoid Buying Ethereum: Hedge Fund Manager appeared first on NullTX.

Ethereum’s Vitalik Buterin Discloses Non-ETH Crypto Holdings and Other Revenue Sources

Ethereum co-founder Vitalik Buterin has disclosed that his crypto investments are virtually exclusively devoted to the Ethereum network.

Ethereum (ETH) co-founder Vitalik Buterin has disclosed that his crypto investments are virtually exclusively devoted to the Ethereum network, in a post published to an “Ask Me Anything” (AMA) Reddit thread on Feb. 18.

The AMA post is dedicated the Ethereum leadership and accountability, asking those in leadership positions in the ETH community to share their possible conflicts of interest.

In Buterin’s summary, his total holdings of non-Ethereum ecosystem tokens — comprising Bitcoin Cash (BCH), Bitcoin (BTC), Dogecoin (DOGE) and Zcash (ZEC) — account for less than 10 percent of the value of his Ethereum holdings.

A further set of non-ETH Ethereum ecosystem tokens — comprised of Kyber (KNC), OmiseGo (OMG), Maker (MKR), (OMG) and Augur (REP) — are similarly reportedly collectively worth less than 10 percent of Buterin’s Ethereum (ETH) holdings.

Buterin also disclosed on the AMA that he has “significant corporate shareholdings” in blockchain research and development firm Clearmatics, as well as in scalability- and privacy-focused blockchain startup Starkware. The latter notably develops cryptographic technology such as zero-knowledge proofs, of which Buterin is a vocal proponent.

Aside from this, Buterin revealed his external revenue over the past 12 months — aside from the Ethereum Foundation — was accounted for by his advisory role for the tokens disclosed in his holdings.

Vitalik also discussed his non-financial involvement in other blockchain projects — including the ecosystems for the aforementioned tokens — as well as several non-token-based Ethereum-related organizations; such as L4, Plasma Group, EthGlobal and EDCON.

He is also reportedly involved in several non-token-based and non-Ethereum organizations — “mainly professional cryptography and economics circles” — which he didn’t specify.

As reported, Vitalik has recently been engaged in an Ethereum developers’ discussion in regard to a new smart contract creation feature set to be released in the forthcoming Constantinople hard fork.

Some community members had voiced their concerns that the feature could have negative security implications, which Buterin refuted, while emphasizing the need to evolve the feature in question with a longer roadmap in view.

Cryptocurrency Can Now Be Purchased at 10,000 French Tobacco Shops

A partnership between French company Digycode and national point of sale (POS) provider Ingenico has gone live, making it possible to buy cryptocurrencies offline at 10,000 tobacco shops in France – just under half of the total number of licensed tabacs in the country. BTC, ETH, LTC, XRP, and DASH are currently available, with BCH and XMR scheduled for sale in the near future.

Also read: Bitcoin Goes on Sale in 24 French Tobacco Stores

Significantly Expanding Customer Reach

Digycode, a subsidiary of Toulouse-based parent company Digital Service, has not seen much reseller traction for its crypto services since its launch in August 2017, with only 30 POS spread across the country by the latter half of 2018. Not that this has impacted profits: Digital Service CEO Christopher Villegas reports that the Digycode product, previously in the form of prepaid cards, brought in revenue to the value of €1 million ($1.1 million) serving over 20,000 customers.

Their hitherto limited reach is now set to change thanks to a triage partnership agreement with payment solutions firm Ingenico and numerous tobacco outlets dotted all over the nation. Ingenico has POS terminals in 10,000 shops spread out across the country, significantly broadening Digycode’s end-customer reach. In effect, this gives Digycode access to a 42% market capture of the 24,000 licensed tobacco shops open for business.

Cryptocurrency Can Now Be Purchased at 10,000 French Tobacco Shops
Buyers can pinpoint their closest participating tabac crypto seller on the Digycode website

A Packet of Smokes and Some Bitcoin, S’il Vous Plait

In France, tabacs, as tobacco outlets are commonly known, sell more than just nicotine. They also offer national lottery tickets, resell mobile recharge vouchers, act as utility bill payment points, and have a selection of newspapers and magazines up for grabs. Thus, in customer’s minds, it’s a one-stop-shop for miscellaneous on-the-go transactions.

The service, which went live on Feb. 11 2019, is available at all tabacs equipped with Devlyx cash registers – a brand particularly popular with tobacconists and newsagents. Thanks to this agreement, consumers can now turn cryptocurrency investors as easily as lighting a cigarette.

Shoppers can purchase vouchers to the value of €20 ($23), €50 ($57), or €200 ($226), and convert them for the crypto of their choice on the Digycode website, where they’ll be added to the user’s wallet. On the menu is bitcoin core (BTC), ethereum (ETH), litecoin (LTC), ripple (XRP), and DASH.

Better Benefits, Higher Fees?

According to Villegas, the hefty 8 percent service fee will be offset by the value-added benefits that differentiates this service offering from online purchasing platforms, including privacy concerns with sharing bank details online, scam concerns on unrecognized platforms, and “devirtualization” of digital currency by bringing it into the real world.

The company is no stranger to the world of virtual currency. Digital Service has been active in the country’s crypto space since 2014. In 2016, it launched bitcoin purchasing platform Zebitcoin and extended its service offering in 2018 with the launch of Zebitex, the first euro-crypto exchange in France.

Regulators’ Stance

In November 2018, overeager reporting by French radio station Europe1 stated that the Federation of Tobacconists had obtained authorization to act as cryptocurrency point of sales. Both the Federation and the Banque de France, the country’s central Bank, were quick to clarify that no such agreement had been reached.

Instead, what was being referred to was a commercial agreement between POS-terminal supplier Bimedia and bitcoin platform Keplerk. The partnership would enable tabacs to provide coupon sales for the Keplerk platform, a service that came into effect in January 2019.

Cryptocurrency Can Now Be Purchased at 10,000 French Tobacco Shops
The French have been able to start the new year with an interesting new addition to their daily tabac shopping options

French regulators continue to maintain the position that cryptocurrencies, as speculative assets, should not be deemed currency, and has issued several warnings to lay investors that partaking in such investments are done at their own risk. Since cryptocurrency sales are legal tender, authorities have no bearing on such transactions.

Small Steps Lead to Giant Leaps

Similar to Zebitcoin, Digycode requires KYC. The initial onboarding process, therefore, isn’t quite as plug-and-play as tabac clientèle will be accustomed. Seeing a “Bitcoin sold here” sign at the corner store is also not akin to lining up to buy it. On the other hand, with cryptocurrency continuing to gain traction and the Yellow Vest movement burning banknotes, it could very well be a case of “build it and they will come.”

While the availability of cryptocurrency at convenience shops is a way off from actively fostering adoption, awareness and availability are crucial first steps.

Digital Service CTO Pierre-Guy Bareges explained to news.Bitcoin.com:

We strive to democratize access to cryptocurrencies for the general public by making local availability and simplicity at the core of our product. Prior to Digycode, buying cryptos in cash was a cumbersome experience especially if you happened to live in small towns or rural areas.

He divulged that they’re planning expansion to other European countries and French territories abroad, as well as the addition of other cryptocurrencies like bitcoin cash (BCH) and monero (XMR).

With this move, Villegas’ grand vision that “anyone [in France] will be able to buy bitcoins for less than 10 kilometers from home” could become a reality.

What are your thoughts on French tabacs starting to sell cryptocurrency? Let us know in the comments section.


Images courtesy of Shutterstock and Digycode.


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The post Cryptocurrency Can Now Be Purchased at 10,000 French Tobacco Shops appeared first on Bitcoin News.

MIT Technology Review: Although Touted for Security, Blockchain Is Still Hackable

MIT Technology Review argued that blockchain tech is hackable due to both system bugs and the human factor.

MIT Technology Review magazine has published an article today, Feb. 19, arguing that security-touted blockchain tech is still vulnerable to hacks. The magazine is fully owned by the United States Massachusetts Institute of Technology (MIT).

In the recent article, the MIT Technology Review stressed that blockchain technology represents a complex economic system that depends on unpredictable human behavior.

As such, the Review pointed out multiple security breaches that have been increasingly emerging in cryptocurrency and smart contract platforms since the inception of crypto, citing a number of incidents including the recent double spending vulnerability that was found on a major U.S. crypto exchange Coinbase on Jan. 7.

The Review has further enumerated a number of conditions that make blockchain technology vulnerable, including both unintentional bugs in the system and the human factor. The magazine wrote:

“In short, while blockchain technology has been long touted for its security, under certain conditions it can be quite vulnerable. Sometimes shoddy execution can be blamed, or unintentional software bugs. Other times it’s more of a gray area — the complicated result of interactions between the code, the economics of the blockchain and human greed.”

The Review has further cited numerous bounties — programs provided by blockchain and crypto companies that allow white hat hackers get rewards by reporting a certain blockchain flaw on a given platform.

According to TheNextWeb, white hat hackers earned $878,000 in total by reporting crypto bugs in 2018.

Recently, Coinbase handed out a $30,000 reward for reporting a critical bug on its system, which is the largest crypto bounty ever given out by the exchange on HackerOne.

Previously, the MIT Technology Review had argued that blockchain technology will finally become common in 2019, considering the technology a disappointment of 2018.

How Apple is Preparing for Life After the iPhone [No, not Buying Netflix With the $250 Billion Cash Pile]

With the iPhone contributing more than 60% of Apple’s sales, it will be hard to replace it with another blockbuster product to compensate for the dwindling sales of the iconic gadget. But the iPhone maker has every intention of filling that void. Towards this end, according to The Wall Street Journal, the tech giant is making leadership changes and reordering priorities. One of the most prominent leadership changes that Apple CEO Tim Cook recently announced was the replacement of the retail chief Angela Ahrendts with human resources head, Deirdre O’Brien, as CCN reported. Earlier this month, the vice president of

The post How Apple is Preparing for Life After the iPhone [No, not Buying Netflix With the $250 Billion Cash Pile] appeared first on CCN

Japan’s Central Bank Examines Central Bank Digital Currencies in New Report

Japan’s central bank examines central bank digital currencies in a new report, laying out their benefits and drawbacks.

Japan’s central bank has examined the role of central bank digital currencies (CBDCs) in the current monetary system in a report released on Feb. 19.

In the document, the bank describes the possible ways to implement a CBDC and the hypothetical consequences of different approaches. The report divides possible CBDCs in two categories, the first being those accessible to the general public in a form like banknotes, and the other as those limited for large-value settlements.

The source of this categorization is attributed to the report released by the Bank for International Settlements in March 2018, which divided CBDCs in general purpose and wholesale CBDCs.

Moreover, after explaining that CBDCs of the latter kind wouldn’t bring many new features to the monetary system, the Japanese report’s authors focused on the first kind throughout most of the document. The report also noted that distributed ledger technology and blockchain could be used for a token-based CBDC.

As Cointelegraph reported in October last year, the deputy governor of Japan’s central bank, Masayoshi Amamiya, has expressed a negative stance towards central bank-issued digital currencies.

More recently, South Korea’s central bank issued a warning over central bank digital currencies a week after saying it would not introduce one itself.

Newsflash: Bitcoin Price Hits 40-Day High, is $5,000 Next?

Bitcoin’s February rally just crossed another milestone on Tuesday when the flagship cryptocurrency touched the $4,000 mark for the first time in more than a month. The crypto market had entered the US trading session on an incline, building upon the gains it consolidated following its last jump on Feb. 8. Shortly after 14:40 UTC, one or more major buy orders caused the bitcoin price to surge, enabling it to touch the $4,000 level before settling back to a present value of $3,955 on Bitstamp. That move brought bitcoin to a 40-day high, as Jan. 10 marked the last time

The post Newsflash: Bitcoin Price Hits 40-Day High, is $5,000 Next? appeared first on CCN

Cambridge Associates: Cryptocurrencies ‘Worthwhile’ For Long Term Investors

bitcoin piggy bank cambridge associates

Leading institutional investment consulting firm Cambridge Associates holds that institutional investors should consider exploring cryptocurrencies for the long term or ‘hodl’ in Bitcoin lingo. 


Cryptocurrencies May ‘Upend the Digital World’

Cambridge Associates is a Boston-based institutional investment consulting company with more than $300 billion in assets under advisement. It holds that it’s high time for institutions to consider cryptocurrencies, Bloomberg reports.

The firm asserts that, despite the twists and turns, cryptocurrencies may ‘very well upend the digital world.’

Despite the challenges, we believe that it is worthwhile for investors to begin exploring this area today with an eye toward the long term. […] Though these investments entail a high degree of risk, some may very well upend the digital world.

However, the consulting firm also recommends spending a “considerable amount of time learning about the space,” exploring the different ways to invest.

Despite the tumbling prices across the entire cryptocurrency market over the past year, Cambridge Associates says that the industry is actually developing.

The dramatic declines that swept across the crypto space raised questions about the future of these assets and the blockchain technology that underpins them. […] Yet, in looking across the investment landscape, we see an industry that is developing, not faltering.

Institutions Dipping Their Toes

Some long-term focused institutions are already taking note and dipping their toes into the arena. According to the Q4 2018 report of digital currency asset manager Grayscale Investments, institutions and retirement accounts comprise the lion’s share in cryptocurrency investing.

wall street symbiont

Earlier this month, Bitcoinist reported that Fairfax County Employee’s and Fairfax County Police Pension Plans became the first US public pensions to invest in a $40 million cryptocurrency fund.

Former Wall Street hedge fund manager Mike Novogratz recently said that institutional money is going to start flowing into the cryptocurrency market within the next 6 to 12 months, following the roll-out of custody solutions by trusted institutions such as Fidelity.

Meanwhile, Fidelity’s Bitcoin custody service is set for launch in March.

What do you think of Cambridge Associates’ position on cryptocurrency? Don’t hesitate to let us know in the comments below!


Images courtesy of Shutterstock

The post Cambridge Associates: Cryptocurrencies ‘Worthwhile’ For Long Term Investors appeared first on Bitcoinist.com.

The Dow is Surging, But This Legendary Analyst Warns the US Stock Market is on Shaky Footing

The U.S. stock market is seemingly in an ideal position to maintain its newly found momentum and extend its short-term rally throughout the upcoming months. The trade deal with China, which is widely considered to be the core catalyst of the U.S. stock market, has seen significant progress. Both countries have acknowledged the importance of a comprehensive trade agreement, and Chinese President Xi Jinping reportedly stated that the U.S. and China are “inseparable,” expressing his intent to reach a deal with the U.S. Louise Yamada Remains Skeptical of Dow’s 8-Week Rally However, on the technical side of the market, legendary

The post The Dow is Surging, But This Legendary Analyst Warns the US Stock Market is on Shaky Footing appeared first on CCN

Crypto Dividends: Staking Coins for Gains Potentially a Good Strategy in a Bear Market but Is Not Without Risk

According to Bloomberg, investors turn to staking for gains in the crypto bear market, but there are risks.

Volatility coupled with one of the longest bear markets ever experienced by the cryptocurrency industry have compelled many investors to consider staking as a method of “playing it safe,” according to a Bloomberg article.

Staking, which is similar to earning dividends or interest on your investment, is not a new concept. However, in a long bear market, it does become more prevalent among cryptocurrency investors, as possible gains from regular trading are not as fruitful. As Kyle Samani, managing partner at Multicoin Capital Management, stated to Bloomberg:

“Regardless of market conditions, staking provides returns denominated in the asset being staked. If you’re going to be long, you might as well stake."

Staking rewards are a byproduct of the proof-of-stake (PoS) consensus algorithm, first introduced by Sunny King and Scott Nadal in a white paper in 2012 for peer-to-peer cryptocurrency Peercoin (PPC).

Since then, hundreds of cryptocurrencies have adopted a PoS consensus algorithm as a method to verify transactions.

Proof-of-stake, explained

The majority of cryptocurrencies use either proof-of-work (PoW) or PoS — or some iteration of it.

PoW relies on the proof that a certain amount of work has been done to verify transactions. Both Bitcoin and Ethereum use PoW to validate transactions, although Ethereum has been making it clear that they will be moving to a PoS system, called Casper, as part of the Serenity network update expected for later in 2019.

At an August 2018 Blockchain at Berkeley event, hosted by the student-run organization Origin, Vitalik Buterin, co-founder of Ethereum, stated he can’t wait for all crypto networks to move away from PoW:

“I am seriously looking forward to when the cryptocurrency community basically passes away with proof-of-work.”

With PoW, nodes (or miners) compete to verify blocks of transactions by running highly specialized and expensive processing equipment (such as Application Specific Integrated Circuits, or ASICs) to solve complex mathematical equations. The first node to solve the equation can add the next block of transactions and collect the reward, which could either be a set amount or percentage of the transaction fee. The process, also called mining, has a number of drawbacks:

  • It is highly energy intensive (the Bitcoin network consumes almost the same amount of energy as the entire country of Singapore).
  • The high energy dependence is not only expensive but also bad for the environment in countries where nonrenewable fossil fuels (such as coal) is burned to generate electricity.
  • Specialized mining equipment requires a significant upfront investment, which can be risky, considering that rewards are not guaranteed.
  • With the advent of large centralized mining pools, the risk of a 51 percent attack on PoW networks is a very real threat.

PoS, on the other hand, only requires network participants to hold a certain amount of the native cryptocurrency in a specific wallet for a certain period of time. This is called staking and doesn’t call for any expensive computer equipment or massive amounts of processing power to solve complex mathematical equations.

Key differences from POW are:

  • Nodes are often called “validators” rather than “miners.”
  • There’s no specialized computer hardware requirement to become a node, which means the burden on power resources is drastically reduced. This is not only cheaper but also more eco-friendly.
  • With PoS, there’s no threat of centralized mining pools.
  • A 51 percent attack would be much more expensive to carry out. In order to take control of a PoS network, an individual or entity would have to purchase 51 percent of the available tokens. Not only that but, if you owned 51 percent of the tokens, you would want to do everything in your power to see the network succeed and continue to turn a profit. That means you are less likely to do anything to defraud the blockchain.

PoW & PoS

Different levels of PoS staking for different levels of rewards

It is common in PoS cryptocurrencies to award those with a bigger vested interest in the network with bigger benefits. This is both in network authority (such as voting weight) and rewards.

As such, cryptocurrency networks will often offer different levels of staking — i.e., the more coins you lock away for staking, the bigger the network will reward you.

This gives rise to two distinguishable types of staking: masternode staking and non-node staking.

Masternode staking to validate transactions

Masternodes are network participants that are tasked with validating and authenticating transactions on a PoS blockchain.

To apply for a masternode, participants will generally have to comply with some minimum requirements. This will be different from network to network but may include locking away a set number of tokens (typically a large minimum), being a network participant and holding tokens for a certain period of time, and being an active community member with a good reputation. The number of masternode positions will generally also be limited.

Rewards are distributed as part of the network fees (transaction fees) and tend to be big, as the vested interest in the network needs to be big. But the barrier to entry is also quite high — i.e., you would need a large initial investment to become a masternode.

For example, to become a Neo masternode (also called bookkeepers or consensus nodes), a participant will need to stake 1,000 GAS ($2,150) — the fuel token on the Neo network that represents the right to use the Neo blockchain and is used to pay the network fees for issuing new assets, running smart contracts and storage — to nominate themselves as a bookkeeper and also obtain a consensus authority certificate before Neo community members can vote for them. The Neo mainnet is limited to seven consensus nodes

According to Neo’s economic model, the maintainer of a Neo consensus node will be rewarded with network fees.

Similarly, to apply for masternode status (also called Authority Masternode) on VeChain (VET), a participant will have to stake 25 million VET ($97,500) to be considered and will have to complete Know Your Customer (KYC) verification in the VeChain portal. Its masternode positions are limited to 101 members.

VeChain masternodes are compensated in part by transaction fees and part from a predetermined foundation reward pool.

Non-node staking to earn interest or dividends

Non-node staking is less complicated, and users are not involved in validating transactions. There is no minimum staking amount and often no minimum holding period, meaning the barrier of entry is much lower.

All a network participant has to do is hold the specific cryptocurrency in the network’s dedicated wallet to start earning interest or dividend payouts.

Both the Neo and VeChain examples above have calculators to show you how much you can earn per amount of tokens staked.

NEO Calculator / VeChain Calculator

Other popular PoS cryptocurrencies for staking include Ontology (ONT), Tezos (XTZ), Waves (WAVES), EOS (EOS), Cardano (ADA), Pivx (PIVX), Dash (DASH), Decred (DCR), Livepeer (LPT) and Factom (FCT).

Potential gains and risks of PoS staking

According to POS List and masternodes.online, rewards and earnings for both masternode staking and non-node staking vary significantly between cryptocurrencies, anything from 0.7 percent to well over 1,000 percent.

The possibility of long-term gains has also given birth to a number of startups that focus specifically on providing staking services to investors, including Anchorage, Eon Staking Inc., Figment and Staked.

Perhaps as an indication of the strong market interest in the possibilities of cryptocurrency staking, on Jan. 31, 2019, Staked announced that they raised $4.5 million in seed investment from a number of institutional investors that included Pantera Capital, Coinbase Ventures and Winklevoss Capital, while Anchorage launched on Jan. 23, 2019 after a $17 million funding round led by venture fund Andreessen Horowitz.

PoS staking is not without risk, though. It’s not just a bear market game, it’s a long game. So, a significant level of trust has to be put in the cryptocurrency network — trust that they will make it through the bear market and still be operational on the other side, and trust that they will consistently payout earnings and rewards in the long run.

Another risk is monopolization of a network, where a few large token holders end up getting the lion’s share of the rewards. Linked to the risk of monopolization is the possibility of a 51 percent attack. Although it would be much more expensive and counterintuitive, it is still possible for such an attack to be orchestrated and to devalue the network.

South Korean Capital to Invest Over $1 Billion in Fintech and Blockchain Startups by 2022

The government of Seoul plans to spend $1 billion to support blockchain and fintech startups via an investment fund.

The Seoul Metropolitan Government has announced plans to invest more than $1 billion in blockchain and fintech startups by 2022, according to the official announcement published on Feb. 18.

According to the release, the South Korean capital’s government plans to use the “Seoul Innovation Growth Fund” for startups that have various investments problems with Series A funding rounds. The fund, launched last year, will primarily focus on startups related to blockchain and fintech industries.

The Seoul Metropolitan Government announcement underlines that the average investment per company in London and Silicon Valley is approximately $6-7 million, while in Korea, it is only about $1.1 million. Jo In-dong, the head of the economic policy department at the Seoul Metropolitan Government, said:

"Innovative startup investments will be the cornerstone of corporate growth that creates innovation in our society and will be a crucial driving force for the growth of innovative venture companies. We will expand our investment to [...] stimulate the startup investment market and create an entrepreneurial ecosystem."

Last month, the capital city’s government announced the launch of the Seoul Blockchain Governance Team, which consists of 100 employees, with the goal to examine the potential and benefits of blockchain applications in various government services, as Cointelegraph wrote on Jan. 31.

As Cointelegraph reported on Oct. 4, the mayor of Seoul, Park Won-soon, revealed a five-year plan, dubbed “Blockchain City of Seoul,” for promoting the development of blockchain-related initiatives in South Korea’s capital city.

Markets Update: BTC Tests $4,000, BCH and ETH Test $150

Markets Update: BTC Tests $4,000, BCH and ETH Test $150

The cryptocurrency markets have produced several days of bullish price action, with BTC testing resistance near $4,000 for the time in five weeks today. In doing so, it’s broken the 100-day moving average for the first time in 272 days. In other market action, both BCH and ETH rallied to test resistance near $150, and EOS spiked to again rank as the fourth largest cryptocurrency by market capitalization.

Also Read: Another ‘Satoshi’ Steps Out of the Woodwork, Calls Craig Wright a Liar

BTC Tests $4,000 for First Time in 5 Weeks

The cryptocurrency markets made a second bullish leg-up today, with only two of the top 50 crypto assets by market cap posting a drop in price during the last 24 hours as of this writing.

BTC rallied to test resistance at the $4,000 area today, marking the first time that BTC has entered $4k territory since Jan. 10. Today’s gains were also driven by a slight uptick in volume when compared to yesterday.

Markets Update: BTC Tests $4,000, BCH and ETH Test $150
BTC/USD – Bitfinex – 1D

In the last two weeks, BTC has gained approximately 16.25% since bouncing off local support at approximately $3,350 to currently trade for approximately $4,000 on Bitfinex and $3,900 on Bitstamp. BTC now has a market cap of $68.91 billion and a dominance of 51.50%.

When looking at the stochastic RSI on the weekly chart, BTC is at its strongest since December 2017.

Markets Update: BTC Tests $4,000, BCH and ETH Test $150
BTC/USD StochRSI

BCH and ETH Test $150

Bitcoin cash produced the second strongest gains of the top 50 cryptocurrencies by market cap today, rallying to test $150 for the first time since Jan. 10.

Markets Update: BTC Tests $4,000, BCH and ETH Test $150
BCH/USD – Kraken – 1D

Since bouncing off support at $100 on Feb. 18, BCH has gained 38.5% to currently trade for nearly $146. When measured against BTC, BCH is currently trading for 0.0375 BTC, an 11% gain in two days. BCH is currently the sixth largest crypto asset with a capitalization of approximately $2.61 billion and a dominance of 1.94%.

Markets Update: BTC Tests $4,000, BCH and ETH Test $150
BCH/BTC – Bittrex – 1D

Ethereum is currently trading for $150. In the last two weeks, ETH has gained roughly 43% over the dollar after establishing support at the $100 area.

Markets Update: BTC Tests $4,000, BCH and ETH Test $150
ETH/USD – Bittrex – 1D

When measured against BTC, ETH is currently testing resistance at the major long-term price level of 0.0375. Ethereum is the second largest crypto asset with a capitalization of $15.53 billion and a dominance of 11.62%.

Markets Update: BTC Tests $4,000, BCH and ETH Test $150
ETH/BTC – Bittrex – 1D

XRP Attempts to Convert $0.34 Resistance Into Support

Ripple has gained 11.5% in two days, with the markets currently attempting to establish support at the recent resistance area of roughly $0.34.

Markets Update: BTC Tests $4,000, BCH and ETH Test $150
XRP/USD – Poloniex – 1D

When measured against BTC, XRP is currently trading for nearly 0.000085 BTC after gaining more than 1% in a single day for the first time during February. XRP is currently the third largest cryptocurrency with a market cap of $13.86 billion and a dominance of 10.37%.

Markets Update: BTC Tests $4,000, BCH and ETH Test $150
XRP/BTC – Bitfinex – 1D

EOS Overtakes LTC by Market Cap

Of the top 50 markets by capitalization, EOS produced the strongest gains of the day, with the price of EOS increasing 16.9% over the dollar in the last 24 hours. Over the course of the last two weeks, EOS has gained nearly 55% to currently trade for $3.66.

Markets Update: BTC Tests $4,000, BCH and ETH Test $150
EOS/USD – Bitfinex – 1D

When measured against BTC, EOS has broken above 0.0009 BTC for the time since Sep 20, 2018. Eos is currently the fourth largest cryptocurrency with a capitalization of almost $3.27 billion and a dominance of 2.44%.

Markets Update: BTC Tests $4,000, BCH and ETH Test $150
EOS/BTC – Bitfinex – 1D

Eos’ gains have seen LTC slide one rank by market cap, with LTC currently ranked fifth with a capitalization of $2.95 billion. Despite this, LTC is testing long-term resistance at the $50 area for the first time since Nov. 14, 2018.

Markets Update: BTC Tests $4,000, BCH and ETH Test $150
LTC/USD – Bitfinex – 1W

When measured against BTC, LTC is against testing resistance at a major long-term price area, with Litecoin currently trading for 0.012 BTC each.

Markets Update: BTC Tests $4,000, BCH and ETH Test $150
LTC/BTC – Bitfinex – 1W

Do you think that markets will continue to be carried by bullish momentum for the rest of the week? Share your thoughts in the comments section below!


Images courtesy of Shutterstock, Tradingview


Disclaimer: Price articles and markets updates are intended for informational purposes only and should not to be considered as trading advice. Neither Bitcoin.com nor the author is responsible for any losses or gains, as the ultimate decision to conduct a trade is made by the reader. Always remember that only those in possession of the private keys are in control of the “money.”

The post Markets Update: BTC Tests $4,000, BCH and ETH Test $150 appeared first on Bitcoin News.

Dow Futures Eye Feeble Open, But is Bitcoin on the Verge of a Historic Recovery?

The US stock market appears doomed to make a weak entry into the week’s first trading session following Monday’s Presidents’ Day holiday, as the Dow and its sister indices are all forecasting opening bell declines. The bitcoin price, on the other hand, burst out of a prolonged period of stagnancy and has many investors questioning whether the cryptocurrency is on the front end of a new bull market. Dow Futures Point South As of 8:55 am ET, Dow Jones Industrial Average futures had lost 58 points or 0.22 percent, implying a loss of 46.25 points at the open. S&P 500

The post Dow Futures Eye Feeble Open, But is Bitcoin on the Verge of a Historic Recovery? appeared first on CCN

Bitcoin Again Tests $4K Amidst Anticipation of US and China Trade Deal Finalization

Crypto markets have continued gaining momentum, with all top 20 coins in green and Bitcoin testing $4,000.

Tuesday, Feb. 19: crypto markets have continued gaining momentum, with all of the top 20 coins by market cap seeing green and Bitcoin (BTC) testing $4,000 again, according to CoinMarketCap.

Market visualization from Coin360

Market visualization from Coin360

Following a slight decline to as low as $3,908 yesterday, Bitcoin has continued growing towards the new price point, currently trading at $3,941 and up 4.4 percent over the past 24 hours. The biggest cryptocurrency saw a sharp bullish move on Feb. 17 and approached $4,000 yesterday by touching $3,973, the highest price point since Jan. 10. Bitcoin is up around 9.3 percent over the past 7 days.

Bitcoin 7-day price chart

Bitcoin 7-day price chart. Source: CoinMarketCap

Ethereum (ETH), the second-largest cryptocurrency by market cap, is up about 3.5 percent, approaching $150. Ethereum is seeing large growth over the week, up more than 22 percent since Feb. 12, when the altcoin was trading at around $121.

Ethereum 7-days price chart

Ethereum 7-days price chart. Source: CoinMarketCap

Ripple (XRP), the second-top altcoin by market cap, is up about 8.3 percent and is trading at $0.338, which constitutes around 12 percent growth over the past 7 days. Recently, BankDhofar, the second-largest bank by market value in Oman, has started using RippleNet tech for cross-border payments to India.

Ripple 7-day price chart

Ripple 7-day price chart. Source: CoinMarketCap

The fourth-top cryptocurrency by market cap, EOS (EOS), is seeing the biggest growth both over the past 24 hours and 7 days, up more than 15.7 percent over the day and about 30.5 percent over the week.

EOS 7-day price chart

EOS 7-day price chart. Source: CoinMarketCap

 

Total market capitalization has surged to $135 billion after having been stuck around $120 billion since Feb. 8. Daily trade volume has continued gaining momentum, currently seeing a slight decline from $36 billion to $35 billion.

Weekly total market capitalization chart

Weekly total market capitalization chart. Source: CoinMarketCap

Yesterday, Indonesia’s commodity futures regulator adopted a legal framework for operating crypto and digital assets futures markets, officially requiring multiple entities on the market to seek regulatory approval and apply for registration before legally launching businesses in Indonesia.

Also on Feb. 18, prominent Bitcoin bull and venture capital investor Tim Draper declared that in five years, only criminals will use fiat as crypto becomes universally widespread. Draper also argued that Bitcoin is more secure than the U.S. dollar, and compared cashing out from BTC with exchanging gold into shells.

Following the long President’s Day weekend in the United States, stock futures were flat to lower on Tuesday as traders waited for new data from the latest round of the U.S.-China trade negotiations, CNBC reports. According to data acquired by CNBC, the Dow Jones Industrial Average dropped about 20 points at the open, while NASDAQ and S&P 500 remained flat.

Meanwhile, oil stayed within sight of its 2019 high of almost $67 a barrel on Tuesday, supported by OPEC-led supply cuts although concern about slowing economic growth is expected to curb the demand.

As the U.S. dollar reportedly weakened on anticipation of the U.S. and China trade deal, gold prices increased to the highest level in more than two weeks on Monday, while palladium hit a record high of $1,449. U.S. gold futures increased by 0.3 percent to $1,326.1 an ounce.

Why Bitcoin needs cash (and is not a byproduct of the cashless society)

The beauty of Bitcoin is best reflected in the lack of a canonical narrative that everyone must believe and profess. People coming from all sorts of backgrounds can find different uses and meanings for Satoshi’s invention. The concept of money that isn’t issued by a central government (and also cannot be confiscated or censored) is appealing to individuals regardless of their values and ideological beliefs.

Nevertheless, this article aims to make a rather controversial point about Bitcoin: in order for it to exist and prove its virtues, it constantly needs an arch nemesis which has the exact opposite features – and this nemesis is best embodied by inflationary governmental money.

Also, an argument against the dream of living in a cashless society is to be presented. The main criticism of this concept is that its features are Orwellian in terms of removing privacy and eliminating surveillance. Furthermore, if fungibility and privacy are to be removed from all monetary transactions, then we might as well surrender our liberties to the arbitrary chains of Big Brother (or else start a new revolution).

At this point in its development, Bitcoin is neither ready to handle all of the world’s economic activities, and nor is it fungible or private. Also, given its fundamental cypherpunk origins, we should regard BTC as a hedge against abusive governments and a way to protect private property worldwide, rather than as a quick way to settle payments. Early bitcoiners who got in for the low fees and instant transaction insertion into the following blocks may disagree and point out to the title of the whitepaper (a peer to peer electronic cash system), but there is really poor scalability in that model of decentralization is deemed as the fundamental value.

Why Bitcoin needs cash to exist

Right now, the most private and convenient Bitcoin transactions are made via cash exchanges in person. Meeting with someone face to face in order to exchange $3900 (the approximate price of one BTC at press time) for one piece of unconfiscatable and uncensorable digital gold is an ideal scenario where greedy third parties are eliminated. Certainly, this kind of exchange requires trust in the other person and should ideally be made in a public place to avoid inconveniences.

Conversely, this approach removes KYC data-hungry entities and fee-collecting intermediaries from the equation – which is a benefit in itself. If you also use wallets like Samourai or Wasabi, then you also get an increased layer of on-chain privacy that will obfuscate your transaction and make it hard to find out to whom you are sending your coins.

Cash (defined as paper or plastic money that you keep in your wallet) is still more useful in day to day transactions because it’s fungible and private: nobody will care that your $10 bill once belonged to Brad Pitt, and this piece of trivia won’t increase its value on the market; likewise, you can make purchases without letting anyone know what your full name is and where you live (something which online purchases have taken away from us).

Furthermore, there are millions of shops and merchants that still have trouble accepting credit cards and would rather take the folded bills in your pocket. If you go shopping in the countryside, lesser developed regions, or even small farmer’s markets, you shouldn’t expect to find quick internet connections and people who are aware of the qualities of sound money. This is where cash comes in handy, and this is something that most likely won’t change in our lifetime.

Now let’s scrutinize the arch nemesis argument (that deals more with the “fiat” side of the debate, which also includes cash): in order for Bitcoin to prove its usefulness and advantages over government-issued money, then fiat needs to continue to exist and be managed by short-sighted man-made law.

At this point, Satoshi’s invention is still young and has yet to demonstrate its capability to withstand attacks (both social and hash-related) while providing a predictable and stable monetary policy. The fact that various actors in the Bitcoin space demand for an increase of the supply, removal of the halving moments, or even a radical change of the game theory via block size reduction is proof that we aren’t witnessing full maturity and people have yet to agree on the long-term model.

Inevitably, we will constantly compare Bitcoin with a relevant fiat currency (such as the US dollar and the euro) in order to determine performance over time and the extent to which the king of cryptocurrencies lives up to the expectations. Since Satoshi launched his invention as a response to the global financial crisis of 2008 and 2009, it’s going to be interesting to see if BTC truly flourishes in the economic environment that it was created to counter. The next recession (or even depression) is the true global test for Bitcoin, as both the technology and its advocates become scrutinized by the financial decisions of billions of disillusioned people.

Even outside a disastrous scenario for the world finances, Bitcoin still needs fiat to shine. And it’s unlikely that governments will surrender their right to issue a currency they can control in order to embrace a system that doesn’t react to their policies. As presented by Thomas Hobbes in “The Leviathan”, governments are nothing more than power-hungry behemoths that we accept due to their ability to tame our beastly urges.

They won’t go away from managing inflationary currencies just because a better alternative exists – they will most likely try to sweeten their policies in order to prevent a complete transition to sound money. And as long as people will ask for increased state intervention in economic affairs, the position of politicians and financial institutions is secure, unquestioned and unaccounted by most.

Bitcoin developer and educator Jimmy Song has also expressed an argument in favor of cash, which has more to do with economic reasons: it’s better to spend the money that depreciates in value over time due to inflation while holding your BTC (which is expected to get more valuable as scarcity and demand increase). He also argued that credit card companies offer some financial advantages that make it more rational to use fiat in everyday purchases and hold onto your bitcoins.

Why Bitcoin isn’t a byproduct of the cashless society

The idea of a cashless society, where people only make financial transactions with digital money, is an invention of the banks, for the banks, and by the banks. Many forms of virtual currencies precede the existence of Bitcoin, but none of them have the censorship resistance and the kind of decentralization which makes any amount impossible to arbitrarily confiscate.

Furthermore, there are many ideas regarding the cashless society that involve cryptocurrencies – but none of them concerns Satoshi’s invention. For instance, tokenizing assets by putting them on the blockchain and allowing remote access is a regulated process that does use some of Bitcoin’s technology without directly involving its protocol. Such a concept involves KYC registration and is bound to the laws of various jurisdictions (including that of the participant and that of the asset’s issuer).

Like the lovechild of the cypherpunk movement, Bitcoin is much more like a rare collectible that cannot be confiscated. The only reason why it is virtual is given by the nature of our all-encompassing Orwellian governments that will legislate against anything that looks like competition. Had a new form of non-governmental currency been invented in this day and age, then the mighty politicians in power would do their best to outlaw and confiscate this kind of economic competition.

Bitcoin, as a successor of Ecash, b-money, Hashcash, and Bit Gold, maintains a degree of cypherpunk-ness which makes it friendly to privacy (as opposed to compliance, as Tim May described it). Therefore, it should also be friendly to other private means of exchanging value – and trades for cash or gold are part of this category. Satoshi’s invention isn’t digital and cashless just for the sake of helping our society take the leap, but because it had to be in order to remain unfonciscatable and uncensorable.

Cryptography is the best defense system that we have against enthusiastic collectors of big data – and whenever we benefit from extra layers of encryption, it’s a battle that we win. If we invent the kind of physical matter which fulfills alchemist Satoshi’s dream of being gold while held by the rightful owner, and turning into coal whenever stolen, then Bitcoin will become useless. Until then, we must make use of it as a hedge against both the corrupt financial system and the government’s excessive surveillance apparatus.

Make no mistake: there are cryptocurrencies that do promote the Keynesian approach to spending, and therefore to facilitate the transition to a cashless society. However, Bitcoin is first and foremost decentralized so that anyone can join the network by running a node, free to the extent that nobody can censor it, and secure to the extent that it cannot be confiscated. Comparisons to Visa can wait.

 

 

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Litecoin Massively Outperformed Bitcoin Since November Sell-Off By 4x

Investors who purchased Litecoin during the significant November 2018 sell-off earned four times more returns than the investors who bought Bitcoin, highlighted Joe McCann.

The financial expert, who serves as the head of systematic trading at crypto asset management firm, Passport Capital, calculated the returns made by the “silver cryptocurrency” from its three-month low to its three-month session high. He found that between November 14, 2018, and February 18, 2019, bitcoin price recovered up to 25.19 percent from its session low. On the other hand, Litecoin corrected as high as 118.67 percent within the same timeframe.

bitcoin, litecoin

Bitcoin vs. Litecoin | Source: Joe McCann Twitter Profile

“Looking at how LTC had outperformed BTC since the epic selloff on November 14th, 2018, we can see that LTC has outperformed BTC by better than 4:1 from the current cycle low to the current session high,” McCann stated.

Altcoins Lead Bitcoin Rally

McCann also called attention to the correlation between Bitcoin and Litecoin over the years. He claimed that Litecoin historically led the Bitcoin rallies, hinting that the altcoin’s latest upside moves could prompt an extended bullish momentum in the BTC market.

As of 0900 UTC, the BTC-to-USD exchange rate was trending near $3,944, which is its best since January 11. According to CoinMarketCap.com 24-hour price calculator, the pair has surged a little over 5 percent. On the other hand, Litecoin has jumped close to 8 percent within the same time.

However, it cannot be said that Litecoin gains could benefit Bitcoin. It could have been possible when the altcoin was among the few projects that competed with bitcoin. But now, the altcoin market is overpopulated with cryptocurrencies that could allow traders to swap their LTC positions for coins other than BTC.

Galaxy, a Twitter-based cryptocurrency analyst with 48.4k followers, said that it was the entire altcoin market that was leading the ongoing bitcoin rally. It predicted that BTC dominance rate would breakdown in 2019 while the market will enter a so-called altseason.

So far, some of the top coins have indeed outperformed bitcoin in terms of a rebound. Ethereum, the world’s second largest cryptocurrency, posted a 90-day surge of 10 percent. Similarly, Tron’s TRX surged 81 percent, Binance’ BNB jumped 62.46 percent, and even Bitcoin SV’s BSV leaped 30 percent. At the same time, bitcoin’s 90-day performance was at a negated 13 percent.

90-Day Crypto Performance | Source: OnChainFx.com

Would Bitcoin Fall Behind?

It is unlikely for altcoins to displace Bitcoin from its top position despite its weak dominance scenario. The world’s leading cryptocurrency is running ahead of its clone projects in terms of institutional adoption. Its fundamentals are the strongest for 2o19, thanks to regulators’ likelihood of approving its trading derivatives.

BlockTower’s Ari Paul said that cryptocurrencies couldn’t match up to the supremacy of bitcoin by just adding features or with incrementally better transactional throughput.

A.T. Kearney, a management consulting company, also claimed that bitcoin would reserve its dominance on the crypto market. In the firm’s opinion, the bitcoin dominance rate could even go up to 66% in the future.

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Full Moon ahead for ether

We are “mooning” today – today is the day when the Earth and the Moon will come the closest (221,681 miles or 356,761 km) in 2019. In the anticipation of this event, ether started to “moon” yesterday. Has the crypto community been right all along – and the cryptocurrency price fluctuations are correlated with the movement of the Earth’s satellite? Stranger things have happened in the past, but this is unlikely. A more plausible explanation for this phenomenon is the upcoming Constantinople Fork that is currently planned for 7,280,000 which should occur on February 27, 2019

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Flag of the Republic of Turkey, Hagia Sophia in Istanbul.

The irony here is that crescent is on the flag of Turkey, which is the successor to the Ottoman Empire. The Ottomans are those that conquered Constantinople, destroyed the Byzantine Empire, renamed Constantinople to Istanbul, and replaced the cross on Hagia Sophia with the crescent moon. There is no doubt that Mr. Buterin is aware of this historical curiosity as one of the prior forks was called Byzantium – that what Constantinople had been called before emperor Constantin gave it an eponymous name.

But let’s switch back from the history of Constantinople to the history of ether price movements following various Ethereum forks predating the Constantinople fork. There have been seven Ethereum hard forks thus far, four of the forks that had been on the original roadmap and three forks had been ad hoc reactions to the discovered vulnerabilities. We examined the movements in Ether price 30 days prior to the fork versus the price 30 days after the fork for all the past forks except for the very first fork – Frontier – as it took place before ether was introduced into the markets.

The average change for all the forks is an unexciting -0.19%. However, once we segment the forks into “on the roadmap” and “not on the roadmap”, we start seeing more interesting results. The average change for the three forks that were not “on the roadmap” is -20.83% and for the other three, it is 20.45%. Furthermore, if we exclude the Frontier Thawing Fork which took place in 2015 when there was no real market established for ether, then the average change for “on the roadmap” forks becomes 37.50%. And this distinction makes intuitive sense – the forks that were on the original roadmap are expected to add new features, improve efficiency etc., whereas the ad hoc ones pinpoint the shortcomings of the original design and infuse general uncertainty about the overall design of the platform.

Ethereum Hard Forks

The -30 day for the upcoming Constantinople Fork is December 29, 2018, ether price on the closing of that day was $105.01. If we were to forecast the price of ether on the +30 day – assuming that the fork does happen on February 27, 2019 – then we expect $126.48 (based on the average for all the “on the roadmap” forks) or $144.38 (excluding Frontier Thawing Fork). Although at the time of this writing the price of ether has already exceeded even the more liberal prediction, it is important to note that the price doesn’t necessarily move in the linear fashion. In addition, the upcoming fork is only one of many factors that affect the price; other factors could either override the “fork effect” or amplify it. There is no denying the fact that this approach for the prediction of the price movement lacks scientific rigor, it sure beats the “when Moon?” approach.

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