Bitcoin breaks above $6,000, and $100 billion in value for the first time in its history

Bitcoin breaks above $6,000, and $100 billion in value for the first time in its history

Bitcoin breaks above $6,000, and $100 billion in value for the first time in its history

The world’s most prominent digital currency was on track to mark a fresh milestone on Friday, with bitcoin rallying and putting the cyber currency in position to hit a total market value of around $100 billion.

Such a valuation would place the No. 1 cryptographic currency above or on par with blue-chip companies on the Dow Jones Industrial Average DJIA, +0.71% like United Technologies Corp UTX, +1.21% with a market value at $96 billion, American Express Co. AXP, +0.21% at $82 billion, Caterpillar Inc. CAT, +0.45% at $77 billion and Travelers Cos. Inc. TRV, +0.11% at $36 billion.

To be sure, it is questionable to draw value parallels between the asset and more traditional companies, but it highlights the stratospheric rise of bitcoin BTCUSD, +3.00% which didn’t exist a decade ago:

Bitcoin surges on Friday to near a $100 billion valuation.

A single bitcoin also broke above a milestone of $6,000, reaching an intraday high of $6,064.14 Friday afternoon, according to research and data site CoinDesk.com. Bitcoin also boasted a market value of roughly $100.81 billion at its peak on the day, according to data site Coinmarketcap.com. The move comes just as the Dow cleared its own psychologically important level of 23,000 on Wednesday.

The Dow has enjoyed an impressive run-up of 17% year to date, the S&P 500 index SPX, +0.51% has climbed nearly 15% so far this year, while the Nasdaq Composite Index COMP, +0.36% has charged up more than 23% thus far in 2017.

However, those paper gains pale in comparison with bitcoin’s run-up. The cyber unit has surged a mind-numbing 520% over the past nine months from $968.23 on Dec. 31, 2016.

Iqbal Gandham, U.K managing director at eToro, a trading platform, said continued buying in bitcoin ahead of a hard fork later in October that will create another version of bitcoin is helping to stimulate investment. So-called Bitcoin Gold, designed to address challenges mining for bitcoin using computers to solve complex problems, will be launched on Oct. 25.

Then on Nov. 18, bitcoin will face a second version of Segregation Witness, or SegWit2x.

Both so-called hard forks are expected to create alternative versions of bitcoin, with owners of the core currency being granted the newer versions on a one-for-one basis.

Diminished expectations that China will ban cryptocurrency exchanges also has helped boost bitcoin’s value. Beijing is expected to require a license to operate bitcoin platforms rather than banning them outright, as had been feared earlier, according to recent reports.

“It’s the flow of positive news clarifying earlier rumors which is moving the price up,” Gandham said.

Jason English, vice president of protocol marketing at Sweetbridge, a blockchain related company, chalked recent moves higher to growing enthusiasm around bitcoin and other cyber units.

“It’s an exciting time to be in cryptocurrencies today,” he said. “More and more individuals and businesses are viewing bitcoin as a store of value that they should be exposed to”

Of course, there are no dearth of critics who see the rapid ascent of digital currencies as a bubble.

J.P. Morgan Chase & Co. JPM, +1.43% CEO Jamie Dimon has been one of the more vocal critics of the currency as a store of value.

“If you’re stupid enough to buy it, you’ll pay the price someday,” he said during a panel discussion last week. Meanwhile BlackRock’s head Larry Fink has described bitcoin as “an index to launder money.”

The No. 2 most prominent cryptocurrency, Ether tokens on the Ethereum blockchain, meanwhile, were also higher. One Ether token was recently valued at $307.
 

Author MARK DECAMBRE

 

Posted by David Ogden Entrepreneur
David Ogden Cryptocurrency Entrepreneur

David https://markethive.com/david-ogden

Bitcoin Price Bounces Back, Crypto Markets Recover to $170 Billion

Bitcoin Price Bounces Back, Crypto Markets Recover to $170 Billion

Bitcoin Price Bounces Back, Crypto Markets Recover to $170 Billion

The crypto markets bounced back on Thursday following a significant contraction the previous day. The bitcoin price led the charge, rising more than 6% to put the $5,700 barrier within its sights, while the ethereum price ticked up 3% to $309. Unfortunately, the recovery was not comprehensive, and some cryptocurrencies — including ripple — continued to decline.


Chart from CoinMarketCap

The downturn forced the total cryptocurrency market cap as far down as $156.5 million, which represented a one-week low. However, the markets began to recover Wednesday afternoon and quickly rose above $160 billion. They continued to climb leading into Thursday morning and have since risen to a present value of $169.7 billion.

Chart from CoinMarketCap

Bitcoin Price Bounces Back

Wednesday’s bitcoin price decline caught many investors by surprise, and it was difficult to ascertain what caused it, other than that traders were taking profits following last week’s rally. The pullback put severe downward pressure on the bitcoin price, which fell as low as $5,151. However, bitcoin held firm at this level, and support gradually began to return, enabling the flagship cryptocurrency to mount a successful recovery. Ultimately, the bitcoin price posted a single-day return of 6%, bringing it to a present value of $5,679, which translates into a $94.5 billion market cap.

Bitcoin Price Chart from CoinMarketCap

Ethereum Price Holds Above $300

The ethereum price experienced a single-day recovery as well, although its performance was not quite as impressive as that of bitcoin. After dipping as low as $291, the ethereum price managed to fight its way back across the $300 threshold. Ethereum is currently trading at $309, which represents a 24-hour recovery of about 3%. Ethereum now has a market cap of $29.4 billion.

Ethereum Price Chart from CoinMarketCap

Altcoins Eye Generally Recovery

Altcoins lost ground to bitcoin on Thursday, which saw its dominant market share rise about 1% to 55.7%. However, the majority of altcoins experienced recoveries against the value of USD, adding about $2 billion to their combined market cap.

Altcoin Price Chart from CoinMarketCap

But there were some significant outliers. In fact, three of the top 10 cryptocurrencies posted negative movement for the day, and the worst performance belonged to ripple. XRP holders had expected Ripple to make a major announcement during “Swell”, a conference hosted by the fintech startup. However, nothing materialized — at least not of the caliber they were expecting — causing the ripple price to add to its losses from yesterday. At present, the ripple price is $0.212, which represents a 24-hour decline of 7%.

Ripple Price Chart from CoinMarketCap

Fourth-ranked bitcoin cash also posted a minor decline, causing it to tick down to about $334. Several major bitcoin cash proponents — including Roger Ver and Calvin Ayre — intend to start a campaign to assert that “bitcoin cash is bitcoin”, so it will be interesting to see if this has any lasting effects on the trajectory of BCH.

Litecoin Price Chart from CoinMarketCap

The litecoin price, on the other hand, rose by 8%. This advance pushed it back over the $60 threshold, and litecoin is currently priced at $61. This translates into a market cap of $3.2 billion.

Dash added 3%, but it was unable to climb past the $300 mark, while NEM surged by just under 10%. NEO declined 3% after weathering the Wednesday downturn quite respectably, and bitconnect rose by 8% to $201. Monero rounds out the top 10 with a 1% increase, which was just enough to inch above the $90 barrier.

Author: Josiah Wilmoth on 19/10/2017

 

Posted by David Ogden Entrepreneur
David Ogden Cryptocurrency Entrepreneur

 

David https://markethive.com/david-ogden

Why Silicon Valley is going gaga for Bitcoin

Why Silicon Valley is going gaga for Bitcoin

Why Silicon Valley is going gaga for Bitcoin

Cryptocurrencies are on a historic tear right now. And Silicon Valley’s infatuation with the industry explains a lot about itself.

Should I buy bitcoin? As a technology reporter, the questions I receive from random people at birthday parties, say, or seatmates on a plane, are usually emblematic of what is going on in the digital world. (And, increasingly, the real one, too, for that matter.) Not too long ago, the predominant question was Should I buy the new iPhone? Then it became Do I need to be on Twitter? or Do I need to be on Facebook? or Do I need to be on Snapchat? (That question has since come full circle to Should I quit Twitter and Facebook?) These days, the question I hear the most—well, besides whether Twitter should ban Trump—is Should I buy bitcoin?

I usually respond with the story of Laszlo Hanyecz. If you’ve come within 500 feet of bitcoin, or any other cryptocurrency, over the past few years, the name alone will make you cringe. Back in 2010, when the currency was in its infancy, Hanyecz went “mining” for bitcoins for a few months and collected 10,000 of them; he subsequently traded them, in what would be the first cryptocurrency transaction in history, to a guy who bought him two Papa John’s pizzas with a couple sides of that tasty, buttery garlic sauce. Back then, Hanyecz’s bitcoins had no value, and the $30 value of two pies and an accoutrement made his individual bitcoin units worth 0.003 cents apiece. Today, at their current market valuation, bitcoin units are worth around $5,800 each, which means Hanyecz’s 10,000 bitcoins would be worth around $58 million. “It wasn’t like bitcoins had any value back then, so the idea of trading them for a pizza was incredibly cool,” Hanyecz told me in 2013, when bitcoin was already valued at $1,242 each. “No one knew it was going to get so big.”

For a lot of people on the periphery of this technology, the extraordinary rise in bitcoin’s value has become cause for alarm. The Web is littered with news articles, blog posts, and white papers warning that bitcoin and its sibling currencies are worth nothing, and the rise and fall of the currencies’ worth, which can fluctuate by billions of dollars a minute, certainly backs that up. But while Jamie Dimon and other bankers might scoff at these digital currencies, Silicon Valley is extremely bullish. There’s a reason, too: if Dimon had invested in bitcoin when he first called it a joke, in 2015, he would have received a tenfold return on his investment.

There are a number of reasons why bitcoin and cryptocurrencies are doing so well right now. One of the more plausible scenarios was outlined this week in a very clever post written by Adam Ludwin, an investor and co-founder of Chain.com, a bitcoin developer platform, which argues that bitcoin is an entirely new asset class, similar to equities and bonds, and that “bitcoin is capitalism, distilled.” The “capitalism” part of the sentence helps explain why some in Silicon Valley are so specifically exuberant about it right now. “In the short-run, there will be extreme volatility as FOMO competes with FUD, confusion competes with understanding, and greed competes with fear (on both the buyer side and the issuer side),” Ludwin wrote. “Most people buying into crypto assets have checked their judgement at the door.”

This gets someone like me a bit nervous about what cryptocurrencies could end up doing to society in the long run. Silicon Valley culture is largely fueled by people who love to decimate industries that don’t work, often without any thought of how the disruption could lead to other negative results happening in society (see the recent social-media debacle around the election ). In typical Valley fantasy, people are seeing only the positive potential with bitcoin, not the potentially ugly outcomes when humans molest it for their own interests.

One of the many factors currently fueling the ascent of bitcoin is the rise of initial coin offerings, or I.C.O.s, where some lucky investors are reaping astounding returns. You can think of these like a traditional initial public offering, or I.P.O., but without the layers upon layers of regulation and government bureaucracy that come with a company going public. With an I.C.O., a start-up raises money for a new venture by selling “coins” that are very similar to shares of a public company. The coins then rise and fall as the company’s value oscillates. In 2014, when the founding of a new cryptocurrency called Ethereum was announced, it raised $18 million by selling a new digital coin called “Ether” for 40 cents per coin. Today, Ethereum has a market cap of around $30 billion. So if you had spent $100 on Ether during the I.C.O., you would have made $74,900 in profit. As Nathaniel Popper detailed in The New York Times earlier this summer, I.C.O.s have been generating billions of dollars in returns for some—and a lot of scams, too.

The lack of regulation in the cryptocurrency world, after all, means that there is a lot of fraud, extreme volatility, and coin values can jump up or down in mere seconds. Someone I recently spoke with who works with, and monitors, the crypto I.C.O. markets pointed out that some of these I.C.O.s feel awfully similar to the Dot Com public offerings of the late 90s, where the public was buying into nothing and ended up with exactly that when the entire market came crashing down and trillions of dollars were wiped off the stock market. In China, I.C.O.s became so troubling that they were banned earlier this year. In September, the People’s Bank of China issued a blunt statement saying that this practice was “illegal and disruptive to economic and financial stability.” I.C.O.s in China were occurring at an astounding rate, with one report claiming that more than $750 million was raised in I.C.O.s in July and August alone. A lot of people think the ban by China is temporary, slowing the dizzying speed of these offerings.

As a result of all the movement in the cryptocurrency market over the past couple of years, there are a lot of options out there for people who want to try their hand in crypto-investing. There’s bitcoin, the first and most well known of all the currencies, which currently oscillates in value at around $5,000 a coin. I’ve heard predictions all over the map, from bitcoins one day being worth as much as $500,000 each to units being worth absolutely nothing if a better coin comes along. (My personal prediction is that they will continue to rise for at least the next couple of years.) Ether had remained relatively flat until earlier this year when it spiked in value to over $350 apiece. (It’s since fallen to $300 each.) The current coin du jour is called Litecoin, which is getting a lot of attention because it’s still priced relatively low, at around $55 each, and is expected to rise considerably over the next year or so on account of new features that will be added to enable more privacy options. Then there are a slew of other coins to explore, including Monero, which is an open-source currency that was developed in April 2014, but which spiked this year after the illegal drug market AlphaBay was taken down. Monero, unlike other currencies, is truly anonymous, making it the perfect currency with which to buy and sell drugs, guns, and other illegal contraband on the Dark Web. If you look at the World Coin Index Web site, you can see a long list of other coins and their values over time, including Ripple, Bitcoin Cash, Qtum, NEO, Nav Coin, NEM, and a number of other coins.

For Silicon Valley, betting on one of these early can mean profiting beyond all imagination, exceeding even the famed 1,000x start-up returns from companies like Facebook and Uber. Earlier this summer, I interviewed Tyler and Cameron Winklevoss, the twins who co-founded The Facebook with Mark Zuckerberg, and they are now obsessively investing in cryptocurrencies. In a settlement with Facebook, the two brothers were awarded $60 million, but to hear them talk about it, it appears their investments in bitcoin and other currencies are going to reap a far bigger return over time. I’ve spoken with countless other people about the current state of bitcoin and cryptocurrency, and I’ve heard two truths that seems consistent. No one—and I mean no one—knows exactly which digital currency will be successful in the future. It could be bitcoin, it could be Litecoin, it could be something that hasn’t even been created yet. But, the other resounding feeling is that these currencies are here to stay in one form or another and there is nothing anyone can do to stop them. Which brings me back to that question that I’m often asked these days: “should I buy bitcoin?”

There’s an old saying in real estate that “you shouldn’t wait to buy, but rather you should buy and then wait.” That’s the way I feel about these cryptocurrencies. If you’re looking for a quick and dramatic financial boost, realize that you could probably get similar odds by buying a plane ticket to Las Vegas, walking into the first casino you see, and putting all your money on black or red. But, if you’re willing to wait it out, there’s a chance that your investment in a cryptocurrency could make for an impressive return over time. Just be prepared to go it the long haul. Or at least until the price spikes tomorrow.

Author Nick Bilton – special correspondent for Vanity Fair.

 

Posted by David Ogden Entrepreneur
David Ogden Cryptocurrency Entrepreneur

 

David https://markethive.com/david-ogden

Bitcoin gets official blessing in Japan

Bitcoin gets official blessing in Japan

Bitcoin gets official blessing in Japan

The broader fintech sector is struggling even as cryptocurrencies take off

Entrepreneurs do not often welcome regulation. For Japanese cryptocurrency start-ups, however, a framework put in place by the country’s financial authorities has been a boon.

Rules announced this year by the Financial Services Agency allow people to pay for goods and services with bitcoin and require cryptocurrency exchanges or remittance operators to be licensed and subject to annual audits. These have given bitcoin official approval.

“The Japanese have felt that cryptocurrencies are a scary thing but trading volumes have increased as many now see it as trustworthy thanks to government approval,” says Yusuke Otsuka, chief operating officer at Coincheck, a bitcoin exchange.

The FSA issued operating licences to 11 bitcoin exchanges late last month. Coincheck has applied for a licence and is hoping to receive approval next month, Mr Otsuka says.

The new digital currency rules come as other governments clamp down on cryptocurrencies. China, for instance, has banned companies from issuing their own virtual currencies and is cracking down on cryptocurrency exchanges.

However, for Japan, cryptocurrencies sit within the realm of fintech. The government and banking leaders hope that this sector’s businesses — ranging from artificial intelligence-led investment advisory groups to cloud data storage — will free up cash sitting in bank deposits and reignite the economy.

There has been domestic hand-wringing over the investment going into fintech ventures in Japan compared with that in other developed countries. Japan’s fintech sector, seen as a laggard, had investments of $65m in 2015. This compares with $12bn in the US, $974m in the UK and $69m in Singapore, according to consultants Accenture.

“We’re hoping that fintech will change economic and corporate activity,” says Takuya Fukumoto, director of industrial finance in the economy, trade and industry ministry. The ministry set out the government’s vision in August, calling for an increase in cashless consumer payments, digitising back-office functions and new technologies to enhance cash flow between companies.

Japanese banks, worried that fintech ventures will become mainstream players, are trying to gain exposure to new technologies by either creating a business or investing in a start-up.

 

Author   Emiko Terazono

Posted by David Ogden Entrepreneur
David Ogden Cryptocurrency Entrepreneur

 

 

David https://markethive.com/david-ogden

Bitcoin Wallet Blockchain: ‘Buy Some Ether’ to Make Transactions After SegWit2x

Bitcoin Wallet Blockchain: ‘Buy Some Ether' to Make Transactions After SegWit2x

Bitcoin Wallet Blockchain: ‘Buy Some Ether’ to Make Transactions After SegWit2x

Crypto wallet Blockchain has announced its intention to join with Xapo in following the blockchain with the most accumulated difficulty following the proposed SegWit2x. The wallet service advised its users to “buy some ether” if they intend to make transactions immediately following the fork.
 

Blockchain Wallet to Follow Chain With Most Difficulty

In mid-November, the Bitcoin blockchain is expected to split into two, competing chains following SegWit2x, a hard fork designed to upgrade the Bitcoin network and enable it to scale more effectively. The proposal appears to have strong support from miners and crypto firms — although this support has steadily waned as the fork has gotten closer — but it is opposed by the Bitcoin Core developers, as well as many other businesses and users.

Consequently, bitcoin services have to decide how they will approach the hard fork. Some, such as Bitfinex, are treating the SegWit2x fork as a separate cryptocurrency, while others, including Xapo, state that they will assign the label “Bitcoin” to the blockchain with the highest accumulated difficulty.

Crypto wallet Blockchain — a SegWit2x supporter — has signaled its intent to follow Xapo’s example and determine which chain will receive the label “Bitcoin” based on the amount of accumulated difficulty each blockchain obtains.

Blockchain chief executive Peter Smith made the announcement in a blog post, stating that the service will provide users with access to the coins on the minority chain if they have “significant value”. Like Xapo, they will label the minority chain either BC1 (incumbent) or BC2 (SegWit2x)
 

Buy Some Ether’

Smith goes on to say that Blockchain may suspend outgoing bitcoin transactions following the fork until the networks have stabilized. He suggests users “buy some ether” if they plan to make transactions in late November following the fork.

During this period, it may be necessary to temporarily suspend outgoing bitcoin transactions for a period of time during network instability. However, even in this scenario, your funds will remain safe and you’ll be able to monitor them from within the wallet. You’ll also be able to use all Ethereum related functionality.

“If you have transactions to make around late November,” he adds, “we suggest you buy some Ether in our wallet today.”

 

Author: Josiah Wilmoth on 16/10/2017

 

Posted by David Ogden Entrepreneur
Davkid Ogden Cryptocurrency Entrepreneur

David https://markethive.com/david-ogden

Bitcoin heading over $10,000 in six to 10 months, former Fortress hedge fund manager says

Bitcoin heading over $10,000 in six to 10 months, former Fortress hedge fund manager says

Bitcoin heading over $10,000 in six to 10 months, former Fortress hedge fund manager says

Bitcoin has surged this year, up to $4874 on Tuesday, and Michael Novogratz sees it heading over $10,000.

Novogratz is starting a $500 million fund to invest in cryptocurrencies, initial coin offerings and related companies.

Although he says digital currencies like bitcoin show signs of forming a bubble, former hedge fund manager Michael Novogratz is going all-in.

The former Fortress Investment Group manager says he's been investing in bitcoin and its underlying blockchain technology for a while and sees bitcoin's price rising to over $10,000 in the next six to 10 months, largely because of heavy investor interest. Bitcoin was up 2.1 percent on Tuesday, to $4874.15 as of 5 p.m. ET, according to CoinDesk, and has surged in value this year.

"I can hear the herd coming," he said during an appearance after market hours Tuesday on CNBC's "Fast Money." He likened bitcoin to digital gold.

Novogratz is starting a $500 million fund to invest in cryptocurrencies, initial coin offerings and related companies. He put $150 million of his own money into Galaxy Digital Assets Fund and plans to raise the rest from outside sources by January, mainly from wealthy individuals and families and fellow hedge fund managers.

He told Bloomberg Television last month that digital currency like bitcoin is "going to the be the largest bubble of our lifetimes." JPMorgan Chase CEO Jamie Dimon last month called bitcoin a "fraud" and said he would fire anyone at his bank for trading it.

But whether bitcoin lasts or eventually gets replaced by the next new thing, the underlying blockchain technology is probably here to stay, he said. "Blockchain will change the way we live," he said. "This is not going away."

 

 

Author: Michael Novogratz

 

Posted by David Ogden Entrepreneur

David Ogden Cryptocurrency Entrepreneur

David https://markethive.com/david-ogden

Analysis of Bitcoin, Ethereum, and Litecoin

Analysis of Bitcoin, Ethereum, and Litecoin

Analysis of Bitcoin, Ethereum, and Litecoin

* All the market data is provided by the HitBTC exchange.

 

The cryptocurrency universe is showing nervousness at the current levels, having recovered anywhere between 50% to 78% of the fall. After having sucked in the eager bulls at lower levels, is a retest of the lows on the cards?

What should be the future plan of action? To hold out or sell now? Let’s uncover the possibilities

Bitcoin

In our previous analysis, we had recommended booking partial profits at about $4459 levels. We are not yet bearish on bitcoin, but we believe that the pullback has reached a significant resistance zone of $4546 to $4680.

So, how far can the digital currency fall?

Bitcoin has significant support from the 20-day exponential moving average (EMA), the 50-day simple moving average (SMA) and the trendline in the zone of $4121 to $4200.

Therefore, a bounce from these levels is likely.

We may see an intraday dip below the trendline, but the closing is likely to be above it. Aggressive traders can initiate long trades close to $4150, if there are clear signs of support kicking in. Please watch for an hour to establish a strong support and then buy. If the cryptocurrency continues to fall, no trade should be taken.

This is a risky trade, therefore, we recommend a smaller position size.

In order to protect our investment, a stop loss of about $3950 can be kept. The target objective of this trade is $4480 and higher.

Ether

While bitcoin is yet to breakdown of the trendline, its junior partner, ethereum has already done so, albeit on an intraday basis. Until the digital currency breaks and closes below the trendline, we will not consider it a valid breakdown.

Ethereum has significant support at the $280 levels, where we expect some buying to emerge.

Nevertheless, we believe that the digital currency is stuck in a tight range of $280 to $310. This range is unlikely to hold out for long. Soon, price will either breakout or breakdown of it. Therefore, we recommend waiting until the digital currency reaches $317, which is a clear indication of demand because if the cryptocurrency breaks down of $280, it can plunge to $240 levels.

We are not recommending a trade within the range, as price is below both the moving averages, which is a bearish sign.

litecoin

Litecoin has formed a clear range of $44 on the lower end and $57.7 on the upper end. The best way to trade within a range is to buy at the bottom and sell at the top.

Currently, the cryptocurrency is trying to hold the psychological level of $50. If this level beaks, a fall to $44 is likely, where the traders can initiate long positions with a SL at $40. However, please don’t buy in a falling market. Wait for prices to bounce off the lows before buying around $44 to $46 levels.

On the other hand, if litecoin finds support at $50 and rallies above $58, we recommend a long position with the stop loss just below $50. A breakout of the range has a minimum target objective of $71.

Guest Writer on 05/10/2017

 

Posted by David Ogden Entrepreneur
David Ogden Cryptocurrency Entrepreneur

 

David https://markethive.com/david-ogden

IMF Head – Cryptocurrency Could Be the Future. Really.

IMF Head - Cryptocurrency Could Be the Future. Really.

IMF Head – Cryptocurrency Could Be the Future. Really.

Christine Lagarde sees a path ahead for cryptocurrency.

The managing director of the International Monetary Fund, or IMF, talked up the potential of virtual currencies to supplant traditional monies in coming decades on Friday. Cryptocurrencies, or virtual currencies, are a new class of digital assets powered by blockchains, distributed ledgers that made their name underpinning networks like Bitcoin and Ethereum.

Unlike JPMorgan Chase CEO Jamie Dimon and billionaire hedge fund founder Ray Dalio, who have recently disparaged Bitcoin, the world's most well known cryptocurrency, Lagarde shared a rosier vision of the general technology's future with attendees of a Bank of England conference in London. "In many ways, virtual currencies might just give existing currencies and monetary policy a run for their money," she said.

"It may not be wise to dismiss virtual currencies," Lagarde told the audience. "Instead, citizens may one day prefer virtual currencies."

Lagarde devoted a third of her talk, which envisioned how financial tech may reshape the world by the year 2040, to the subject of cryptocurrency. She noted that digital money could gain popularity as engineers work through technology issues related to processing more payments through blockchain networks in the future.

"Why might citizens hold virtual currencies rather than physical dollars, euros, or sterling? Because it may one day be easier and safer than obtaining paper bills, especially in remote regions," Lagarde said. "Virtual currencies could actually become more stable."

Lagarde couched her predictions with the pretense of sci-fi ("Are you ready to jump on my [hovering drone] pod and explore the future together?" she said), but her forecast matches the view of other big-name optimists, like Fidelity CEO Abigail Johnson. "I'm a believer," Johnson said at an industry conference earlier this year about digital currencies.

Other topics Lagarde touched on included the possible disruption of the traditional banking business model by fintech upstarts as well as the advent of artificial intelligence.

You can read Lagarde's prepared remarks in full here, or read on for the segment about cryptocurrency, below.

1. Virtual currencies

Let us start with virtual currencies. To be clear, this is not about digital payments in existing currencies—through Paypal and other “e-money” providers such as Alipay in China, or M-Pesa in Kenya.

Virtual currencies are in a different category, because they provide their own unit of account and payment systems. These systems allow for peer-to-peer transactions without central clearinghouses, without central banks.

For now, virtual currencies such as Bitcoin pose little or no challenge to the existing order of fiat currencies and central banks. Why? Because they are too volatile, too risky, too energy intensive, and because the underlying technologies are not yet scalable. Many are too opaque for regulators; and some have been hacked.

But many of these are technological challenges that could be addressed over time. Not so long ago, some experts argued that personal computers would never be adopted, and that tablets would only be used as expensive coffee trays. So I think it may not be wise to dismiss virtual currencies.

Better value for money?

For instance, think of countries with weak institutions and unstable national currencies. Instead of adopting the currency of another country—such as the U.S. dollar—some of these economies might see a growing use of virtual currencies. Call it dollarization 2.0.

IMF experience shows that there is a tipping point beyond which coordination around a new currency is exponential. In the Seychelles, for example, dollarization jumped from 20 percent in 2006 to 60 percent in 2008.

And yet, why might citizens hold virtual currencies rather than physical dollars, euros, or sterling? Because it may one day be easier and safer than obtaining paper bills, especially in remote regions. And because virtual currencies could actually become more stable.

For instance, they could be issued one-for-one for dollars, or a stable basket of currencies. Issuance could be fully transparent, governed by a credible, pre-defined rule, an algorithm that can be monitored…or even a “smart rule” that might reflect changing macroeconomic circumstances.

So in many ways, virtual currencies might just give existing currencies and monetary policy a run for their money. The best response by central bankers is to continue running effective monetary policy, while being open to fresh ideas and new demands, as economies evolve.

Better payment services?

For example, consider the growing demand for new payment services in countries where the shared, decentralized service economy is taking off.

This is an economy rooted in peer-to-peer transactions, in frequent, small-value payments, often across borders.

Four dollars for gardening tips from a lady in New Zealand, three euros for an expert translation of a Japanese poem, and 80 pence for a virtual rendering of historic Fleet Street: these payments can be made with credit cards and other forms of e-money. But the charges are relatively high for small-value transactions, especially across borders.

Instead, citizens may one day prefer virtual currencies, since they potentially offer the same cost and convenience as cash—no settlement risks, no clearing delays, no central registration, no intermediary to check accounts and identities. If privately issued virtual currencies remain risky and unstable, citizens may even call on central banks to provide digital forms of legal tender.

So, when the new service economy comes knocking on the Bank of England’s door, will you welcome it inside? Offer it tea—and financial liquidity?

Author: Robert Hackett

Posted by David Ogden Entrpreneur
David Ogden Cryptocurrency entreprenur

 

David https://markethive.com/david-ogden

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 https://markethive.com/david-ogden

Standpoint Founder – Bitcoin Asset Class Will Grow Into $2 Trillion Market

Standpoint Founder - Bitcoin Asset Class Will Grow Into $2 Trillion Market

Standpoint Founder – Bitcoin Asset Class Will Grow Into $2 Trillion Market

 

Forget $5,000.

At a time when many are making short-term bets on the price of bitcoin and other cryptocurrencies, one bitcoin bull is going a step further. Ronnie Moas, founder of Standpoint Research, is making the case cryptocurrencies will not only be a decade-long trend, but a viable asset class.

In fact, he's going so far as to call for a massive rise in the market cap of cryptocurrencies. His prediction? The total value of all cryptographic assets, today valued at $150 billion, will soar to $2 trillion over the next 10 years.

And in a new interview, Moas walked CoinDesk through his forecast, explaining how it stems from his fundamental analysis of the capital markets and the broader macroeconomic trends he now sees in place.

The Standpoint founder's view stands in stark contrast to the highly bearish analysis of Peter Schiff, who called cryptocurrency a bubble, a speculative frenzy and a natural Ponzi scheme driven by "just plain greed" last week.

In the broadest sense, Moas sees the current state of the cryptocurrency market as a direct parallel to Silicon Valley during the 1990s, when a massive surge of innovation created new technologies that transformed the way we work and live and ushered in a period of massive wealth creation.

He explained:

"I am not any more concerned with bitcoin being at a record high than Amazon or Google investors were concerned when those share prices jumped hundreds of percent and hit $100 and $200 many years ago. Today, both of those stocks are above $900. The question is not where we are at – it is where are we going? I do not think we are in a bubble."

 

Roadmap to $2 trillion

How does Moas get to the $2 trillion market cap for cryptocurrency in his forecast?

He begins by looking at the $200 trillion that is currently invested in global capital markets today, including all major asset classes: cash, stocks, bonds and gold. Moas, who also does traditional equity analysis, begins his market breakdown with stocks, which he believes are currently overvalued.

According to Moas, three-quarters of the names in the S&P 500 are trading at least 18 times earnings, which is higher than his value threshold of 12 times earnings. He also adds that we haven't had a stock market correction in 20 months.

On the currency front, the U.S. dollar is currently losing 1 to 2 percent per year due to inflation. Moas also points out that the dollar has lost half its value since he was in high school 35 years ago.

 

From a global perspective, where most people don't have access to U.S. dollars, Moas believes the case for cryptocurrency is even more compelling:

"Now, imagine what they think of their own local currencies elsewhere in the world. Imagine you live in Venezuela and you're keeping your money under the mattress. Would you rather leave it there in Venezuelan bolivar or would you rather put it in bitcoin? It's not going to take you very long to make that decision."

Breaking his thesis down further, Moas believes that a conservative estimate is that at least 1 percent of the $200 trillion now tied up in stocks, cash, gold and bonds will migrate into cryptocurrencies over the next decade.

In that case, he says, "Bitcoin could end up with a market capitalization that is more than Amazon and Apple combined."

Under this scenario, that would mean that the current market capitalization of all cryptocurrencies would naturally grow.

And if Moas's market capitalization targets are correct, investors would then receive a 1,250 percent return on their cryptocurrency investments made today.

 

Diversified strategy

But he adds one major caveat to that prediction. Simply, "You've got to be in the right names."

Assuming you accept Moas's basic bull market thesis for cryptocurrencies, how do you know if you are invested in the right "names" in the cryptocurrency space? And, if the market boom in cryptocurrency is analogous to the roaring years of the 1990s tech boom, how can you avoid investing in the next Pets.com?

As Moas frames it:

"A lot of people say there is a bubble out there. I see a bubble when you get down below the top 50 cryptocurrencies. There are more than 800 names right now. In my view, what happens outside the top 50 is irrelevant."

Moas goes on to point out that 91 percent of the nearly $150 billion market cap is invested in the top 20 names and 70 percent is invested in bitcoin and ether alone.

He recommends, for the purposes of portfolio diversification, retail investors should hedge their bets and invest across the top 10 or 20 cryptocurrencies.

In Moas's view, the 800 cryptocurrencies that are now trading are analogous to the 800 stocks that were available on the Nasdaq at the height of the dot-com bubble nearly 20 years ago. While Amazon and Apple and Microsoft emerged to become among the most valuable companies of all time, there were many companies from that time period that died slow and painful deaths.

Or, as Moas more colorfully puts it: "Back then, there were hundreds of pump-and-dump, small-cap junk names just as there are in crypto today. Today, the crypto market is giving you the same signals with names like dash, ripple, litecoin, monero, bitcoin, ethereum, neo, nem, iota and others."

He went on to add that while there are certainly risks involved in investing in cryptocurrency, those risks are, in his view, outweighed by the possibility of 10-to-one or 20-to-one payout to the upside experienced by tech stocks.

 

The bull case

Of all the major cryptocurrencies, though, Moas seems especially bullish in his view of bitcoin. Unless there is a major shakeup in the underlying confidence, he believes that investors are going to want to buy-and-hold for their portfolios for 10 years or more.

Moas points out that there are currently only about 16 million bitcoins that have been issued of a possible total 21 million coins that will be created.

In his analysis, this could lead to tens of millions of people trying to get their hands on just a few million coins.

When asked for a specific price target, Moas summed up as follows:

"At the beginning of July, bitcoin was trading at $2,500. I believe in the next three years you will probably see $15,000 to $20,000 for bitcoin. It could double twice from here in the next 36 months."

 

 

Aug 24, 2017 at 09:00 UTC by Ash Bennington

 

Posted By David Ogden Entrepreneur

DAvid Ogden Cryptocurrency Entrepreneur

David https://markethive.com/david-ogden