What you need to know about the latest Bitcoin boom

What you need to know about the latest Bitcoin boom

 

You may have noticed reports about Bitcoin’s value recently – its price is headed into the stratosphere.

The crypto-currency’s recent meteoric price rise over the summer has seen one Bitcoin go from being worth $1,500 in early May to more than $5,000 over the weekend, before dropping to $4,654 at the time of publication.

And that has got all kinds of people interested – people like Andrew Beckwith, a DJ who goes by the name Supersede. “I play restaurants, lounges, nightclubs, corporate events,” he says.

But he also invests. Beckwith has just taken his first step into the world of crypto-currencies, having converted $100 into Bitcoin.

“I don’t know how far it’s going to grow,” he explains, “but if something is growing at hundreds of per cent, that’s a pretty valuable return.”

Bitcoin is notorious for its volatility, but the recent peaks are unprecedented. In late 2013 its value jumped from around $100 to $1,000 – a bigger percentage increase – but it is worth more than four times that today.

“Recently there’s been a lot more talk in the media and others have been investing,” explains Kiran Varughese, another amateur investor, who works for an elevator company in Dubai.


The notoriously volatile crypto-currency has been making headlines with its skyrocketing value, but some believe it’s a bubble driven by speculation (Credit: Getty Images)

A friend’s experiments with Bitcoin piqued his curiosity so he clubbed together with another pal to invest $1,000 in August. If they lose it, he says they won’t be too worried – the potential for a big return within the next few years is too tantalising for Varughese to resist.

But are investors like Varughese and Beckwith taking too much of a risk by buying into Bitcoin, and other crypto-currencies like Ethereum, Litecoin or Dash? Is there something about these digital currencies that underpins their soaring prices or are they simply subject to whims in the market that can make fortunes but also devastate them?

While the market capitalisation of all crypto-currencies now stands at $150 billion, they still occupy a strange space in the world of finance.

“Every year Bitcoin continues to exist is something to take note of,” says Garrick Hileman, a research fellow at the Cambridge Centre for Alternative Finance at the University of Cambridge. “It’s a significant achievement for Bitcoin to have survived the many setbacks and challenges that it has faced.”

One of these challenges occurred recently when Bitcoin split in two. It happened after the Bitcoin community became divided over how to allow more transactions to be processed with the currency. Because Bitcoin has no over-arching authority that controls it, any decision to alter the system that underpins it needed to gather enough support from Bitcoin users to go ahead. The system itself is called the blockchain – a huge digital ledger that records every single Bitcoin transaction in history.


Mining Bitcoin takes time and computer processing power, so it’s often done in massive farms such as this converted warehouse in Moscow, Russia (Credit: Getty Images)

As computers on the Bitcoin network verify transactions, “blocks” of data are added to the ledger, storing this information. Computers that do this work receive a small sum of bitcoins as a reward – this is the process known as mining. Every single computer on the network has a copy of the blockchain and their copy of it is constantly updated.

But until recently, Bitcoin blocks were limited in size to a megabyte every 10 minutes, meaning that the rate at which the blockchain could grow was capped. In early August, a new version of the crypto-currency – Bitcoin Cash – was mined for the first time. Its blocks can be up to eight megabytes in size.

Some believe the smooth transition through this “fork” without any technical disasters has contributed to renewed confidence in Bitcoin, in turn helping to pump the price up. One “coin” of Bitcoin Cash is worth less, around $630 today, but that’s up $200 since its inception a month ago.

Another fork to upgrade the block size further is expected in November and if successful, it might have a similar impact on Bitcoin’s buoyant price.

But “currencies” like Bitcoin aren’t really playing the role of a traditional currency at the moment, says Vili Lehdonvirta, an economic sociologist at the Oxford Internet Institute, which is part of the University of Oxford.

“When I called up a restaurant in Helsinki earlier this year to ask if they accept Bitcoin, the response was that they tried it a few years ago, nobody ever used it, and thus they no longer accept it,” he explains.


Most retailers don’t accept the crypto-currency (Credit: Getty Images)

BBC Capital contacted 10 businesses in London that have advertised an ability to accept Bitcoin in the past. Four of them said they had stopped accepting and two that did accept them reported hardly ever processing such payments.

Instead, it appears many people are simply speculating on Bitcoin – investing in what is a relatively high-risk asset in the hope of a short-term gain in profit. But lucrative outcomes are by no means guaranteed – and many still think that Bitcoin is just a bubble.

In the short-term there may be various reasons why people are buying in while the price is buoyant. Some may like investing in a currency unconnected to nation states, suggests Hileman. It could be seen as good insulation against uncertain political developments that can cause traditional currencies to plummet dramatically – as happened to the British pound in the aftermath of the Brexit vote. Volatile international disputes, such as those involving North Korea, could be driving people to put their money elsewhere.


The pound dropped sharply after Brexit – since Bitcoin is not tied to any one nation-state, it’s less affected by large political events (Credit: Getty Images)

“If you’re in South Korea and you’re concerned about a geopolitical event, do you trade in the US dollar?” asks Hileman. “Maybe that’s not a great idea because the US will be involved, as will China and Japan, so it’s not surprising to see people look for alternative currencies,” he says.

Applied cryptography consultant and Bitcoin-watcher Peter Todd says some are also attracted by Bitcoin’s independence for broader political reasons, too.

In an uncertain world, people’s financial freedom is sometimes limited by their governments. Take India, which recently tried to curb public investments in gold as this was harming the nation’s economy. Bitcoin is a global entity, no one government can fiddle with it – although there are countries where trading it is illegal.

Still, crypto-currencies remain associated with plenty of risks that go beyond their volatility. Many people store their bitcoins in online exchanges and should these be hacked or go bust, which has happened more than once, then the money is often lost forever.

With all the technical ups and downs of crypto-currencies – their changes and potential to split into new currencies for example – there is also a significant degree of complexity that can leave less informed investors bewildered.


MtGox, a Bitcoin exchange based in Tokyo, collapsed after losing nearly $500m in Bitcoin to what it says was a hack attack (Credit: Getty Images)

A new area of excitement, known as initial coin offerings (ICOs), are also beginning to worry some experts. ICOs allow owners of crypto-currencies to invest in fledgling companies, with many using Ethereum as their digital coin of choice. However, ICOs have already been associated with a number of scams and hacks, and China just banned them, calling ICOs 'illegal fundraising'.

“I think the main thing we’re seeing in ICOs is straight-up fraud,” says Todd. He is concerned about efforts by regulators to clamp down on this because such an approach could backfire and encourage scammers to become more sophisticated.

“It’s when things look legit that they get dangerous,” he says, pointing out that a few years ago Bitcoin and other digital tokens had more of a “Wild West” feel to them, which perhaps meant people were less likely to be duped since scams were crude and easy to spot. As more and more investors get involved in crypto-currencies, scams can get slicker and the natural wariness that can keep people cautious may also diminish.

Bitcoin and other crypto-currencies are gradually cementing their stated position – providing a radical new alternative to the investment options that existed before them. But there is no certainty as to how this massive experiment will play out. Though when did that ever stop hopeful investors taking a punt?

 

By Chris Baraniuk
7 September 2017

This story was produced under the BBC's guidelines for financial journalism. A full version of those guidelines can be found at bbc.co.uk/guidelines.

 

Posted by David Ogden Entrepreneur

David

Bitcoin’s Golden Future

Bitcoin Golden Future

Bitcoin's Golden Future

Could bitcoin be the next gold?The idea has a lot of intuitive appeal. Gold bugs and bitcoin fetishists tend to share a deep distrust of fiat currency and the nation state, an impregnable bullishness about their favored asset class, and an obsessive attention to details of market movements combined with a blithe disinterest in bigger-picture issues.The idea has become particularly popular as the value invested in bitcoin and other cryptocurrencies has marched upward over the past year. Even after this week's selloff, prompted by China declaring initial coin offerings illegal, the value of all cryptocurrencies in circulation is around $155 billion, according to Coinmarketcap.com.

That may sound small compared to the $7.8 trillion notional value of the world's 187,200 metric tons of gold. At the same time, it's already about a tenth the value of the 40,000 tons of yellow metal used for investment as bullion bars and coins, and has overtaken the amount held in gold exchange-traded funds. At more than $78 billion, Bitcoin alone isn't far from overtaking the $90 billion-odd invested in all gold ETFs.There are two main reasons to doubt bitcoin's viability as an investment. One is an engineering issue: Its creaky infrastructure is likely to be a turn-off for all but the hobbyist fringe. Another is more philosophical: Digital currencies have no fundamental value, so have no place in a portfolio.Both objections are weaker than you might think.Take infrastructure. It's certainly true that bitcoin's operations are surprisingly clunky. Just confirming a single transaction typically takes more than an hour or longer — it briefly took more than a day at one point last month, according to software company Blockchain.info.
Having said that, financial markets are generally built on similar Rube Goldberg foundations. It's comically difficult for ordinary investors to buy an actual barrel of crude oil, as Tracy Alloway of Bloomberg News found out a few years back. The economist John Maynard Keynes, according to one possibly apocryphal story, once measured up the storage capacity of the chapel of King's College, Cambridge after coming perilously close to having to take delivery of a month's worth of the U.K.'s wheat supply. Completing transactions in the real world is often so clunky that some banks are already exploring using, um, blockchains instead.What makes markets investable for the most part is not their physical foundations, but the superstructure of derivatives contracts, exchanges and clearing houses built on top.To date, the world of bitcoin exchanges has been the wild west. When Mt. Gox filed for bankruptcy in 2014, it said it had lost 850,000 coins worth more than $450 million. Another $70 million-odd was stolen in a hack of Bitfinex last year. The likes of Deribit and Bitmex have been offering bitcoin futures and options for some time, but major institutional investors are only going to participate if they think the clearing and settlement process is rock-solid and the exchange itself reliably solvent.Change on that front is imminent. The Chicago Board Options Exchange is planning to start offering cash-settled bitcoin futures by next April, CNBC reported last week. Trading platform LedgerX LLC last month won regulatory approval from the U.S. Commodity Futures Trading Commission to act as a clearing house for derivatives settled in digital currencies. The ability to short or take leveraged positions in digital currencies could open them to a far wider array of investors.

What, though, is the value of a digital currency? It's a fair question, but one that could equally be leveled at gold. Since Richard Nixon ended the fixed $35 an ounce convertibility of gold in 1971, its value has risen at times (the 1970s, the 2000s) and fallen at others. The best argument to justify investing in gold these days is not that it's an eternal "store of value" but that its very weirdness makes it special: According to modern portfolio theory, you should buy the shiny stuff not for its superior investment returns, but because it doesn't correlate much to other asset classes such as stocks, bonds and commodities.

However, while gold did exhibit weak or negative correlations to returns on the S&P 500 for much of the 1980s and early 1990s, it's been positively correlated for extended periods since then. During gold's 2012 run-up, the two moved more or less in tandem. If gold deserves investment dollars because its inconsistent correlation with equities helps diversify portfolios, the same argument can be made for bitcoin, too.Digital currencies may be as vulgar as the original barbarous relic, but neither is going away any time soon. If that makes investors in both look less like seers and more like problem gamblers betting on where a fly will land — well, welcome to financial markets.

 

Author: David Fickling

 

Posted By David Ogden Entrepreneuer

David Ogden Cryptocurrency Entrepreneur

David

Bitcoin price drops $200 after new ruling from Chinese regulators

Bitcoin price drops $200 after new ruling from Chinese regulators

Bitcoin price drops $200 after new ruling from Chinese regulators

  • Bitcoin's price fell after China announced a ban on initial coin offerings (ICOs) from $4,584 to around $4,350 per bitcoin.
  • This move to be shortlived, according to experts.
  • The move by China is not the first time the country's regulators have attempted to crack down on cryptocurrency.
  • The price of bitcoin fell sharply after Chinese regulators announced a ban on organizations from raising funds using initial coin offerings (ICOs).
     

ICOs allow start-ups to raise investment by selling new cryptocurrencies, which are similar to bitcoin, in return for cash. However, the People's Bank of China says this practice, which has become popular around the world as well as in China, constitutes illegal fundraising.

Despite bitcoin's price falling, some expect this move to be shortlived.

"This type of news is 'universally' negative sentiment, within the crypto space, so we are not surprised to see a dip on all assets today," Fran Strajnar, co-founder and CEO of data and research company Brave New Coin, told CNBC via email.

"We do not see this to be a lasting issue."

While the ban on ICOs does not directly affect bitcoin, the news created negative market sentiment which is weighing on the prices of several virtual currencies, according to Charles Hayter, chief executive and founder of digital currency comparison website CryptoCompare.

"A rising tide lifts all boats but the opposite is also true – with generally bad news reverberating across the ecosystem all cryptos have turned red together," he told CNBC via email.

However, Hayter added that the long-term effects of regulation are positive.

"The wheat will be sorted from the chaff and a new gold standard of ICOs can be striven for," he said.

Bitcoin's price fell from $4,584 shortly before the announcement to around $4,350 per bitcoin. It was trading around the $4,429 level at midday London time on Monday, according to market data from Coindesk.

The move by China is not the first time the country's regulators have attempted to crack down on the cryptocurrency space. In January and February, the central bank warned several digital currency exchanges they would be shut down if they violated anti-money laundering rules.

Furthermore, while bitcoin dropped sharply on the news, its price has been trending down since hitting the $5,000 milestone at the weekend. Strajnar said this recent climbdown is most likely just profit taking by investors.

"There is likely some profit taking since reaching almost $5,000 on bitcoin, but the amount of fresh capital that continues to pour in suggests this is not the start of a trend reversal."

Should you invest in a cryptocurrency?

Author: Luke Graham 

Posted by Daviid Ogden Entrepreneur

David Ogden Cryptocurrency Entrepreneur

Mine Bitcoin Here

 

David

Venezuela Cracks Down On Cryptocurrency Mining

Venezuela Cracks Down On Cryptocurrency Mining

Venezuela Cracks Down On Cryptocurrency Mining

Venezuela Cracks Down On Cryptocurrency Mining
 

Cryptocurrency mining has become an important source of income in Venezuela, a country ravaged by hyperinflation, but it has also become hazardous as police are cracking down on people they suspect of using too much electricity.

Venezuelans have turned to cryptocurrencies as inflation has ravaged the official bolivar, which has lost 99.4% of its value since 2012. As a result, mining has become more lucrative, and a way for people to earn money to pay for basic living expenses, according to CNBC.

 

Desperation Drives People To Mining

One miner, who agreed to speak only anonymously, became a miner because his $43 monthly salary couldn’t support his family. He began mining illegally by using government computers where he worked, and eventually quit his government job to mine at home.

Another miner who has since fled to the U.S. said mining kept him out of poverty in Venezuela. He said one mining rig will produce enough income to feed a family.

Another woman who works three jobs said mining produces 80% of her $120 monthly income. She said mining has allowed her to support herself and her daughter.

One man said the easiest way to acquire commodities in Venezuela is to use cryptocurrency to buy things on purse.io. He said he orders staples like soap and deodorant and has a courier deliver them to his office.

Miners often turn to online forums to learn how to mine.

 

Government Cracks Down

While mining has become a necessity to many, it has also become dangerous since it is illegal and police arrest people they suspect of using too much electricity. Subsidized electricity in Venezuela keeps the cost of mining down, but the government monitors its use carefully.

In 2016, two men in Valencia were arrested on charges of energy theft and possessing contraband. Since then, arrests have increased. One police official said the offenders are exploiting resources without documentation. A Reddit post said miners in the country are being arrested and charged with terrorism, money laundering and other crimes.

One 23-year-old who said he earned $20 a day mining Ethereum when the currency was at its price peak said he lives in fear of being arrested. Another miner said he was approached by intelligence officials who asked him why he was consuming so much power from his home. He said he moved to another location.

Still another miner said he conceals his electrical footprint by splitting his mining equipment across three locations. He pays neighbors to use their electricity for his mining.

Joe Lubin, Ethereum co-founder, said cryptocurrencies, despite their volatility, are integral to survival in places where natural currencies are spiraling out of control.

 

Author: Lester Coleman on 03/09/2017

 

 

Posted By David Ogden Entrepreneur

David Ogden Cryptocurrency Entrepreneur

David

Record $5,000 Bitcoin Price Triggers $13 Billion Market Sell-Off

Record $5,000 Bitcoin Price Triggers $13 Billion Market Sell-Off

Record $5,000 Bitcoin Price Triggers $13 Billion Market Sell-Off

The bitcoin price touched $5,000 this morning, ushering in a historic moment for the cryptocurrency ecosystem. Unfortunately, this achievement also triggered off a comprehensive market sell-off. Almost every major cryptocurrency–including ethereum, Ripple, and IOTA–experienced significant price decreases.

Record $5,000 Bitcoin Price Triggers $13 Billion Market Sell-Off

Chart from CoinMarketCap

The sell-off led to a significant crypto market cap pullback. At the height of the rally, the total value of all cryptocurrencies reached $179.7 billion–a new all-time high. However, nearly $13 billion of that has evaporated in the past 12 hours, bringing the current market cap to about $167 billion.

Chart from CoinMarketCap

Bitcoin Price Hits $5,000, then Dives

The bitcoin price crossed the $5,000 threshold on several exchanges during the early morning hours of September 2, raising the global average price to an all-time high of $4,975. Unfortunately, the bitcoin price did not sustain that level for long. By 3:30 UTC, the bitcoin price had fallen to $4,800. Within another three hours, it had plunged to $4,625. Bitcoin rallied back to $4,775, but the upward momentum did not continue. By the time of writing, the bitcoin price had dropped to $4,630, which translates to a $76.6 billion market cap.

Bitcoin Price Chart from CoinMarketCap

Ethereum Price Rally Stalls

The bitcoin sell-off led to a widespread market pullback, and the ethereum price was not immune. For most of September 1, the ethereum price hovered at about $390. But once bitcoin began to fall, ethereum followed. The ethereum price plunged as low as $352 at 6:00 UTC and currently sits at $357. This reduced ethereum’s market cap to $33.7 billion–a 24-hour decline of 8%.

Ethereum Price Chart from CoinMarketCap

Litecoin Price Reaches $92 for New ATH

The altcoin markets turned red following the bitcoin sell-off, and only three top 25 cryptocurrencies made positive movement for the day.

After inching back to $600 yesterday, the bitcoin cash price dropped to $591. The Ripple price mirrored ethereum’s plight, dropping 8% to $0.231.

Altcoin Price Chart from CoinMarketCap

Litecoin was one of the rare coins with a 24-hour price increase. The litecoin price increased 6% to $80. During the past day, only bitcoin boasted a trading volume greater than litecoin’s $1.7 billion.

However, what this statistic conceals is the fact that the litecoin price had actually risen to a new all-time high of $92 this morning, meaning that it has dropped $12 from its daily peak. Litecoin now has a market cap greater than $4.2 billion.

Litecoin Price Chart from CoinMarketCap

The NEM price fell 5% but maintained a slight market cap edge on Dash, which returned a 6% decline. The Monero price, meanwhile, fell 8%, forcing its market cap below $2 billion. Tenth-ranked IOTA had the worst performance of any top 10 coin, plunging 20% to $0.678.

IOTA Price Chart from CoinMarketCap

Aside from litecoin, only two top 25 cryptocurrencies increased in value over the past 24 hours. Ethereum classic, now ranked 9th, grew 3% to $20 as part of its latter-week rally. NEO, which recently dropped out of the top 10 following a steep decline, managed to defy the wider markets and rise 5% to $33.

Bitcoin Dominance Stable for Week

Bitcoin’s slice of the total crypto market cap ended the week at 45.8%, which is just slightly below where it began. Ethereum’s share had swelled during the middle of the week but had tapered to 20.1% by Saturday. Litecoin recorded the week’s most significant gains, rising from 1.7% on August 26 to 2.5% on September 2.

Market Cap Distribution Chart from CoinMarketCap

As the distribution currently stands, bitcoin cash and Ripple account for 5.9% and 5.3%, respectively. The remaining ~20% is divided between the other 1,000 or so coins and assets tracked by CoinMarketCap

 

Author: Josiah Wilmoth on 02/09/2017

Posted by David Ogden Entrepreneur

David

Bitcoin Price Nears $5,000; YTD Growth Exceeds 400%

Bitcoin Price Nears $5,000; YTD Growth Exceeds 400%

Bitcoin Price Nears $5,000; YTD Growth Exceeds 400%

2017 has been a breakout year for bitcoin and the cryptocurrency ecosystem as a whole. Now, as the bitcoin price approaches $5,000, it’s an excellent time to look back at the trials and triumphs that have contributed to this 400% YTD rally.

Global Adoption & the Road to $5,000

Bitcoin rang in the new year by crossing $1,000 for the first time since the 2013 melt-up, and the Financial Times promptly called it a pyramid scheme that would soon collapse to zero. The bitcoin price held at this level for the next three months, leading critics like Gizmodo writer Michael Nunez to complain that it “refuses to just die already.”

Of course, bitcoin obituaries like these ignored bitcoin’s increasing global expansion. There was once a time when bitcoin risked becoming a Western phenomenon, excluding the majority of the world’s population. Today, that could not be further from the truth. Bitcoin adoption has exploded in Asia, and the highest-volume cryptocurrency exchange is located in South Korea. Bitcoin has also made inroads into emerging markets such as Africa and India.

This year has also seen Japan embrace bitcoin more rapidly than perhaps any other nation. Toward the beginning of the year, Japan terminated its crippling 8% bitcoin consumption tax, and before long major retailers were accepting bitcoin payments. By the end of the year, analysts predict that as many as 300,000 Japanese businesses will accept bitcoin.

By late April, the crypto market advance had begun to pick up steam, leading to a market cap explosion in May and June. On May 20, the bitcoin price broke through $2,000. Less than a month later, it crossed $3,000 on several exchanges for the first time.

Bitcoin Price Nears $5,000; YTD Growth Exceeds 400%

YTD Bitcoin Price Chart from CoinMarketCap

Despite this bull run, bitcoin almost lost its status as the largest cryptocurrency by market cap. About this time, ethereum came within $10 billion of bitcoin’s market cap, making it seem inevitable that there would be a “Flippening” between the two cryptocurrencies. MarketWatch columnist Brett Arends, meanwhile, wrote that both cryptocurrencies were “complete garbage.” However, the Flippening never came. The markets took a bearish turn following the June 26 “Monday Massacre,” and bitcoin consolidated its position as the dominant cryptocurrency.

Eventually, the markets recovered. After falling as low as $1,900 during mid-July, the bitcoin price reversed course toward the end of the month, initiating the record rally that has carried bitcoin to the brink of $5,000.
 

Bitcoin Overcomes UAHF and PBoC Squeeze

The most astonishing aspect of the bitcoin price’s 2017 performance is not its 400% climb, but rather the trials it overcame to get there. Aside from the incessant claims by mainstream media analysts that bitcoin is a bubble, bitcoin faced adverse events that threatened its future. One of these was increasing regulation. Bitcoin has faced regulation since shortly after its inception, but its 2017 bull run has intensified government interest in cryptocurrency. As early as January, the People’s Bank of China (PBoc)–China’s central bank–began putting a regulatory squeeze on bitcoin exchanges in response to “abnormal [bitcoin] price fluctuations.” Exchanges shut their doors as the PBoC began conducting on-site inspections. However, the PBoC ultimately allowed Chinese bitcoin exchanges to continue their operations, albeit with strict supervision.

More recently, bitcoin survived the contentious bitcoin cash hard fork that split the bitcoin network into two different blockchains. Rather than lead the bitcoin price into decline, the hard fork actually appeared to build confidence in bitcoin’s ability to survive a serious community divide, and bitcoin soared more than 75% in the month that followed.

Scaling With SegWit

The bitcoin cash hard fork was caused by the debate about the best way to scale the bitcoin network. Bitcoin cash proponents, claiming to follow Satoshi’s vision, believed that raising the block size was the best way to ensure bitcoin remained a viable P2P transaction vehicle rather than just a settlement layer. Bitcoin Core, however, adopted Segregated Witness (SegWit), a scaling and transaction malleability fix that also facilitates the creation of Lightning Networks. SegWit was activated earlier this month, which should soon cause bitcoin transaction fees–which reached above $8 this month–to finally decrease to more acceptable levels.

SegWit2x and the Road Ahead

Of course, SegWit activation did not put the scaling debate to rest. Earlier this year, a group of prominent bitcoin companies and personalities signed the New York Agreement (NYA), which proposed a hard fork to the bitcoin protocol. SegWit2x, as the proposal is known, called for a block size increase in addition to SegWit activation. The proposal received near-universal support from miners, but Bitcoin Core developers have vociferously opposed it. Relations between Core and SegWit2x supporters have worsened over the intervening months, and several companies have reversed their NYA support. Despite Core opposition, SegWit2x proponents say they will proceed with the hard fork in November, creating a potentially-chaotic situation in which two blockchains will fight to be the “real bitcoin”.

Nevertheless, investors remain bullish on bitcoin, and the bitcoin price’s triumphant march toward $5,000 continue

 

Author: Josiah Wilmoth on 01/09/2017

 

Posted by David Ogden Entrepreneur

David Ogden Cryptocurrency Entrepreneur

David

Bitcoin’s nearly five-fold climb in 2017 looks very similar to tech bubble surge

Bitcoin's nearly five-fold climb in 2017 looks very similar to tech bubble surge

Bitcoin's nearly five-fold climb in 2017 looks very similar to tech bubble surge

David Ader, chief macro strategist at Informa Financial Intelligence, shows how bitcoin's gains resemble that of the Nasdaq Telecommunications Index before the tech bubble burst.

Bitcoin has gained nearly 400 percent this year, helped by increased interest from institutional investors.

However, digital currency expert Chris Burniske points out the market value of bitcoin is still a fraction of what stocks were during the dot-com boom.

Vidoe blob:https://www.cnbc.com/e53fec4c-f5c1-4568-b72a-67d362f70882

When charted, bitcoin's rapid gains resemble how stocks surged into the tech bubble before collapsing.
 

David Ader, chief macro strategist at Informa Financial Intelligence, matched a graph of the Nasdaq Telecommunications Index at its peak in 2000 to bitcoin's five-year run to all-time highs.

"This is the price chart for an overly frothy market, in my opinion. I just don't see anything quite as comparable to this in bubblelicious terms," said Ader, a former top-rated bond market strategist.
 

Bitcoin climbed more than 3.7 percent Thursday to a record of $4,802.74, up nearly five times in price this year and about 67 percent higher for August, according to CoinDesk.

Bitcoin's nearly five-fold climb in 2017 looks very similar to tech bubble surge

"I think it's going to come to a sorry ending," Ader said. "I don't know anybody who's actually used a bitcoin for any purpose legal or otherwise. This looks like an overly frothy market and frothy markets lose their froth."

Ader said he used the Nasdaq telecom index since many of those stocks led the Nasdaq composite's overall gains during the tech bubble. The Nasdaq telecom index shot up more than 700 percent from 1995 to 2000, before collapsing 90 percent in the next two years. The index remains about 75 percent below its record high.

Bitcoin's meteoric surge this year comes as many on Wall Street are becoming more interested in the digital currency and the blockchain technology behind it. New digital asset investment funds are rolling out and the Chicago Board Options Exchange is planning to launch bitcoin futures.

Many investors also bought bitcoin this month after it survived a relatively uneventful split on Aug. 1 into bitcoin and bitcoin cash, an alternative version supported by only a few developers. Bitcoin cash is up about 180 percent from its Aug. 1 low, to Thursday's price of $588, according to CoinMarketCap.

However, bitcoin could split again this fall because there's another upgrade proposal, and others have warned that the speculative forces behind bitcoin could quickly turn against it.

Here are a few of the alarm bells sounded this summer:

The Elliott Wave Newsletter predicted bitcoin's surge from 6 cents in 2010, but in July said bitcoin's surge has surpassed the tulip mania of roughly 400 years ago and is now showing signs of nearing a sharp downturn.

Later in July, widely followed Bank of America Merrill Lynch commodity and derivatives strategist Francisco Blanch concluded in a sweeping report that bitcoin still faces many challenges to becoming a globally accepted currency.

Then about a week later, a New York University finance professor, Aswath Damodaran, said in a blog post that bitcoin may just be a "dangerous pricing game."

By percent change, analysis from Bespoke Investment Group shows how bitcoin's surge has already well surpassed that of any major stock market bubble.

Bitcoin's nearly five-fold climb in 2017 looks very similar to tech bubble surge

Source: Bespoke Investment Group

That said, some well-respected names on Wall Street have also issued positive reports on the digital currency.

In early July, Thomas Lee became the first major Wall Street strategist to issue a report on bitcoin. A former JPMorgan strategist who co-founded Fundstrat, Lee said bitcoin could reach $20,000 to $55,000 by 2022. On Aug. 18, he established a mid-2018 target of $6,000 for bitcoin.

According to a mid-July Forbes report, investing legend Bill Miller put 1 percent of his net worth into bitcoin in 2014, and the digital currency is one of the top holdings in Miller's $120 million hedge fund.

Stock analyst Ronnie Moas of Standpoint Research published a report in late July predicting bitcoin would rise nearly 80 percent to $5,000 in 2018. He then raised that target in mid-August to $7,500.

Lee and Moas both reason that bitcoin can climb to those levels if even a fraction of the trillions of dollars in gold or other traditional investments move into the digital currency.

Bitcoin has a market value of about $78 billion, and digital currencies overall are worth $170 billion, according to CoinMarketCap.

That makes the value of all digital currencies less than 5 percent of the more than $4 trillion inflation-adjusted value of stocks during the tech and telecom boom, said Chris Burniske, author of the upcoming book, "Cryptoassets: The Innovative Investor's Guide to Bitcoin and Beyond.
 

"If people think this is the 'big bubble,' then they don't have an appreciation for how big the idea of cryptoassets really is," he said.

Many digital currency enthusiasts agree there is speculation in the digital currency. But they note that, just like the dot-com bubble, companies that were able to utilize the underlying technology then became global giants.

 

Evelyn Cheng
Writer

 

Posted by David Ogden Entrepreneur

David

Ethereum, Bitcoin Prices Rally Despite Sluggish Market

Ethereum, Bitcoin Prices Rally Despite Sluggish Market

Ethereum, Bitcoin Prices Rally Despite Sluggish Market

Bitcoin and ethereum continued to rally on Wednesday, pushing the total value of all cryptocurrencies higher even as the wider markets were mostly red. The bitcoin price punched through $4,500 to set a new all-time high, while the ethereum price looks poised to make a record-setting run of its own.

The total cryptocurrency market cap climbed as high as $167 billion Wednesday morning, continuing its August bull run. At present, however, the crypto market cap has tapered to $162.6 billion.


Chart from CoinMarketCap

Bitcoin Price Targets $5,000

The bitcoin price spent the latter half of August stuck between $4,000 and $4,400. As the month waned, it did not appear bitcoin was going to be able to break past this level. However, the bitcoin price defied many investor expectations by spiking from $4,400 to $4,600 at about 12:30 UTC on August 29, posting a new CoinMarketCap average record of $4,627. On some individual exchanges, the price rose even further. The bitcoin price has not yet found solid support for $4,600, which has caused it to pull back to $4,501 this morning. Nevertheless, this represents a daily gain of 3% and gives bitcoin a $74.4 billion market cap.

Bitcoin Price Chart from CoinMarketCap

Now that bitcoin has broken through the $4,500 wall, many analysts predict it will cross the $5,000 threshold in short order. RT host Max Keiser, for instance, stated that he believes it will probably reach that level this week.

Ethereum Price Inches Closer to All-Time High

All eyes were on bitcoin as it set a new all-time high, but ethereum made impressive progress on Wednesday as well. Bolstered by increases in ETH/KRW and ETH/CNY, the ethereum price climbed to $389 on August 30, its highest level since June 14. At present, the ethereum price is $367, resulting in a market cap of $36.6 billion.

Ethereum Price Chart from CoinMarketCap

 

Altcoin Markets Take a Hit

Bitcoin and ethereum may have been posted solid gains on Wednesday, but traders dealt the altcoin markets a blow.

The bitcoin cash price fell to 2% to $573, continuing its week-long decline. The Ripple price managed to climb 1%, thanks to news that the FinTech startup had given a presentation on blockchain trends to officials from the central bank of China. The litecoin price was mostly stable, holding at about $62, while Dash and NEM each made minor advances.

Altcoin Price Chart from CoinMarketCap

This is where the chart starts to turn red. IOTA dipped 2% to $0.828, while the Monero price fell 6% to $128, despite strong volume from Bithumb’s newly-opened XMR/KRW market.

Monero Price Chart from CoinMarketCap

The hardest hit cryptocurrency in the top 10, however, was NEO. The “Chinese Ethereum” plunged by 17% to about $31. This reduced its market cap to $1.5 billion and gives it just a $41 million edge on 11th-ranked ethereum classic.

7-Day NEO Price Chart from CoinMarketCap

Outside of the top 10, the majority of cryptocurrencies engaged in a retreat. That retreat included Qtum and Hshare, which had just entered the $1 billion club on August 29. Unfortunately, these tokens had their membership cards revoked on Wednesday as they experienced declines of 19% and 27%, respectively.

 

Author: Josiah Wilmoth on 30/08/2017

 

Posted By David Ogden Entrepreneur

David

SEC Warns Public to Avoid ICO Scams Manipulating Stock Prices

SEC Warns Public to Avoid ICO Scams Manipulating Stock Prices

SEC Warns Public to Avoid ICO Scams Manipulating Stock Prices

The U.S. Securities and Exchange Commission (SEC) has issued an investor alert intended to warn the public about companies using claims about initial coin offerings (ICO) to manipulate their stock prices.

SEC: Avoid ICO-Related Microcap Scams

The alert, which was published by the SEC Office of Investor Education and Advocacy, specifically focuses on publicly-traded companies who claim to be involved with or investing in ICOs. They allege that companies use the lure of cutting edge technology like ICOs to manipulate their stock price and facilitate pump-and-dumps.
 

From the alert:

Fraudsters often try to use the lure of new and emerging technologies to convince potential victims to invest their money in scams. These frauds include “pump-and-dump” and market manipulation schemes involving publicly traded companies that claim to provide exposure to these new technologies.

 

The SEC had previously issued an investor alert regarding direct ICO participation, but they have found that companies may be “publicly announcing ICO or coin/token related events to affect the price of the company’s common stock.” This is particularly a problem with microcap companies, whose stock price can be manipulated in the same way that traders can artificially pump up the price of a cryptocurrency with a small market cap and then dump their coins to secure a profit.

SEC Cracks Down on Public Bitcoin Firms

The Commission says this type of fraud is often rampant within the emerging technologies sector. For this reason, they have been cracking down on publicly-traded bitcoin firms in recent months. In August alone, the SEC has suspended securities trading for CIAO Group (OTC: CIAU), First Bitcoin Capital Corp. (OTC: BITCF), and Bitcoin Crypto Currency Exchange Corporation (OTC: ARSC). All of these companies had seen dramatic increases in the price of their stock, leading the SEC to want to take a closer look at their operations.

According to the release, the SEC issues trading suspensions due to the following occurrences:

  • “A lack of current, accurate, or adequate information about the company – for example, when a company has not filed any periodic reports for an extended period;
  • Questions about the accuracy of publicly available information, including in company press releases and reports, about the company’s current operational status and financial condition; or
  • Questions about trading in the stock, including trading by insiders, potential market manipulation, and the ability to clear and settle transactions in the stock.”
  • A suspension does not necessarily mean a company is acting nefariously, but the SEC warns investors to take caution when considering an investment in a company whose stock has been suspended.

The SEC has been monitoring the cryptocurrency industry with an increasingly watchful eye. Last month, they issued a report concluding that DAO tokens are a security, which implies that smart contract tokens may also fall under securities regulations. This is one reason why Filecoin restricted its record-setting $250 million ICO to investors willing to submit to SEC accreditation.

 

Author: Josiah Wilmoth on 29/08/2017

 

Posted By David Ogden Entrepereneur

DAvid Ogden Cryptocurrency Entrepreneur

David

$154 Billion – Bitcoin Price Rally Carries Crypo Markets to New Record

$154 Billion - Bitcoin Price Rally Carries Crypo Markets to New Record

$154 Billion – Bitcoin Price Rally Carries Crypo Markets to New Record

The bitcoin price rallied on Wednesday, leaping 9% to cross $4,200. The wider crypto markets followed bitcoin’s lead, with 93 of the top 100 cryptocurrencies marching into positive territory for the day.

This near-universal advance added more than $10 billion to the total cryptocurrency market cap. After entering the day at $142.5 billion, the total value of all cryptocurrencies burst through the $150 billion threshold to set a new all-time high of $154 billion.

Popular Cryptocurrency Chart

Bitcoin Price Leaps Past $4,200

The bitcoin price had experienced an early-week correction, briefly diving as low as $3,675 on August 22. Theories for this decline include a hashrate shift from bitcoin to bitcoin cash, as well as concerns surrounding the Segwit/Segwit2x debate. However, the bitcoin price had strong support on the Asian exchanges, which helped prevent it from staying below $4,000 for long. Today’s 9% climb brings the bitcoin price to a present value of $4,243 and a market cap of just over $70.1 billion.

 

Ethereum Price Closes on $350

The ethereum price did not quite keep pace with bitcoin, but it did return a 4% increase for the day. At present, the value of ether is $323, bringing the ethereum market cap to $30.4 billion.

Metropolis, ethereum’s next major protocol upgrade is, quickly approaching. Although these protocol upgrades are implemented by hard forks, they have generally been supported by the community. Consequently, many investors believe the ethereum price will close on $350 as its September release nears.

 

Bitcoin Cash Price Stumbles Following Difficulty Adjustment

The bitcoin cash price surged close to $1,000 last week, one of several converging factors that made bitcoin cash more profitable to mine than bitcoin. Suddenly, the bitcoin cash hashrate exploded, nearly reaching parity with bitcoin. At its height, bitcoin cash boasted 44% of the combined hashrate between the two coins.

However, the hashrate increase triggered an August 22 difficulty adjustment that caused bitcoin cash mining profitability to plunge. Bitcoin cash is now just 42% as profitable to mine as bitcoin, which has led several miners to move hashpower back to the main blockchain. At present, bitcoin cash has about 27% of the combined bitcoin hashrate.

The difficulty adjustment coincided with a decrease in the bitcoin cash price. Despite the widespread market advance, the bitcoin cash price retreated 7% to $661. Bitcoin cash now has a $10.9 billion market cap.
 

Ripple Price Soars to 50% Gain

Bitcoin cash was the only top 25 cryptocurrency to decrease more than 1% for the day, and most coins returned significant gains.

popular chryptocurrency charts

Altcoin Price Chart from CoinMarketCap

The Ripple price led the way, posting a shocking 50% increase following a flood of volume on the major Korean exchanges. This rapid advance raised the Ripple price as high as $0.300 for the first time since June 25, although it has since tapered to $0.277. Ripple now has a market cap of $10.6 billion, putting it within striking distance of reclaiming the 3rd spot from bitcoin cash

Fifth-ranked IOTA rose 9% to $0.92, while the litecoin price increased 4% to $48. The NEM price saw just a 2% gain, but it was enough to raise its market cap to $2.3 billion. The Dash price rose 7% to $300, and NEO climbed 9% to about $38. Other than Ripple, ethereum classic was the only top 10 cryptocurrency to rise more than 10%. ETC’s 14% gain helped it secure the 10th place spot from Monero, who rose 8% to a new all-time high of $98.

 

Author: Josiah Wilmoth on 23/08/2017

 

Posted By David Ogden Entrepreneur

David Ogden Entrepreneur

David