Samsung Pay May Integrate Crypto on Millions of Smartphones, Starting With the Galaxy S10 – What’s the Realistic Impact?

According to a report from The Korea Herald, a mainstream media publication based in South Korea, Samsung Pay could integrate crypto into the Samsung Galaxy S10.

Earlier this month, CCN reported that the potential development of a crypto wallet by Samsung and the Galaxy S10 development team was leaked by an insider.

New reports suggest that Samsung will bring crypto into its ecosystem through Samsung Pay, its flagship digital payments platform.

What Effect Could Samsung Pay Have on Crypto?

In late 2018, MK reported that Samsung Pay has more than 10 million users in South Korea alone that utilize the application to settle day-to-day payments.

With Kakao’s KakaoPay, Samsung Pay dominates the country’s digital payment sector, partly due to its $200 million acquisition of LoopPay, which allowed Samsung Pay to use its magnetic secure transmission (MST) technology, an alternative to NFC that is used by Apple Pay and KakaoPay.

Speaking to The Korea Herald, an industry official said that the integration of a crypto wallet by Samsung and Samsung Pay could lead to the mainstream adoption of cryptocurrencies in the local market.

The official said:

“The arrival of the new Samsung phones could start popularization of the cryptocurrency wallet system in Korea.”

Since mid-2018, Samsung, South Korea’s largest conglomerate, has shown interest in the utilization of cryptocurrencies in commerce.

A report released by Samsung Insights previously emphasized that mobile devices are typically more secure in storing cryptocurrencies due to the presence of a Trusted Execution Environment (TEE).

On PCs or desktops, private keys to wallet addresses are stored in the same memory as the operating system. As such, in an event of a hacking attack, a hacker could easily gain access to the data.

Joel Snyder at Samsung Insights explained:

“If a wallet stores the private keys on a normal persistent store (such as a hard disk or SSD), whether on a standard Windows PC or in a smartphone, a bit of malware can easily get access to them. If those private keys are in the TEE and only accessible via a trustlet, there’s no possible way the malware can extract the keys directly.”

Historically, Samsung has tended to focus on markets which it can reasonably penetrate into with minimum resources and capital using their existing infrastructure.

“Cryptocurrency users may not pay much attention to the mechanics of how their coins are stored, but that can be a dangerous attitude to have. Picking a dependable cryptocurrency wallet is an important part of using cryptocurrencies safely,” Snyder said.

The integration of a cryptocurrency wallet into the Galaxy S10 could demonstrate the security of its TEE and software like Knox to a new group of users.

If Samsung Pay is involved in the process and cryptocurrencies are integrated into the fintech application, it also provides an edge over its competitors in Asia such as KakaoPay and AliPay.

A Win-Win Integration

Although Samsung has not released an official statement regarding the rumors of a potential crypto wallet launch, every company and market involved in the development benefits from it and the deal makes sense for the conglomerate.

Samsung will appeal to millennial users who perceive cryptocurrencies as an efficient and alternative means of payment method over traditional systems, and cryptocurrency users will benefit from a native app that prioritizes security.

KakaoPay has been working with UPbit, a cryptocurrency exchange owned by Dunamu, a company invested by Kakao, to provide support to the trading platform.

With two of the largest digital payment applications in South Korea experimenting with cryptocurrencies in different ways, in the long run, industry experts foresee the infrastructure supporting cryptocurrencies to improve significantly.

Author: Joseph Young 
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Bitcoin Investors Are Abandoning Crypto for Gold during the Bear Market: Vaneck CEO

Bitcoin investors are abandoning crypto in favor of traditional commodities like gold amid the prolonged market slump. That’s the observation of Jan Van Eck, the CEO of investment management firm VanEck Associates.

Van Eck says this is a reversal of the trend he saw in 2017, when the then-sizzling bitcoin pulled demand from gold during the crypto bull market.

“I do think that bitcoin pulled a little bit of demand away from gold in 2017,” Van Eck told CNBC (video below). “Interestingly, we just polled 4,000 bitcoin investors. And their No. 1 investment for 2019 is actually gold. So gold lost to bitcoin [before], and now it’s going the other way.”

‘Bitcoin Sucked the Life Out of Gold’ In 2017

Tim Seymour, the founder of Seymour Asset Management, agreed. “There’s no question that bitcoin sucked life out of the gold market [in 2017].”

However, Seymour says bitcoin has its limits as a long-term investment because it’s so volatile and is not a store of value.

“Not only have we lost all liquidity in the underlying [commodity], but truly outside of the existential blockchain argument, it’s been very difficult to argue [that bitcoin is a] store of value. Gold is a store of value, and there’s no disputing that.”

If gold is climbing, this is good news for Jan Van Eck, because his firm launched the first gold equity fund in the United States back in 1968. And in 2016, it rolled out the first gold miners ETF.

An informal Twitter poll conducted by Gabor Gurbacs ― VanEck’s director of digital strategy ― indicates that 41% of the almost 5,000 people who voted in the survey plan to invest in gold and other commodities in 2019.

VanEck Plans to Refile Bitcoin ETF Application

Separately, Jan Van Eck said he decided to withdraw VanEck’s bitcoin ETF application last week due to the 35-day US government shutdown. He thought it was wiser to withdraw the application than have it get rejected.

He also conceded that the SEC had concerns about VanEck’s inability to solve the custody problem and the fact that most bitcoin is priced overseas. However, Van Eck plans to re-file its bitcoin ETF application once the SEC resumes normal operational capacity.

“We will refile and re-engage in discussions.”

On January 25, President Donald Trump signed a temporary spending bill that will reopen the government until February 15. After that, if Trump and Congress are still unable to negotiate a solution for border wall funding, it’s possible (though unlikely) that another shutdown could occur.

Author: Samantha Chang 
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JPMorgan Takes Another Shot at Bitcoin, Claims Mining Isn’t Worth the Value of the Cryptocurrency

By A report by JPMorgan suggests that for over four weeks during the fourth quarter, bitcoin’s market price was lower than its mining costs on average.

According to the JPMorgan analysts, the cost of mining bitcoin during Q4 was averaging about $4,060 around the world, Bloomberg reports. According to them, starting late November when the price of bitcoin went below $4,000, it became uneconomical to mine bitcoin.

Bitcoin Price Still Below the Globe’s Average Cost of Mining

Currently, bitcoin is trading at around the $3,650 level after falling off the $3,700 resistance level which it touched earlier.

Bitcoin Price. Source: TradingView

Chinese miners were the exception though as they incurred lower mining costs. On average Chinese miners spent approximately $2,400 to mine one bitcoin:

“The drop in Bitcoin prices from around $6,500 throughout much of October to below $4,000 now has increasingly pushed margins further and further negative for just about every region except low-cost Chinese miners.”

Bitcoin miners in the world’s second-largest economy achieved this by directly buying electricity from power generators with excess production. Some of these power generators include aluminum smelters.

Additionally, the analysts have estimated that bitcoin’s marginal mining cost would go below $1,260 if only Chinese miners remained.

Bitcoin Miners Expected to Exit, Lowering the Hash Rate

Per the JPMorgan Chase analysts, the miners whose expenses exceed the cost of bitcoin are expected to exit the space. Such capitulation would benefit the remaining miners as it would lower the hash rate (computing power required to mine bitcoin). Once the hash rate goes down the remaining miners will be able to mine more bitcoins without raising energy consumption.

This level of capitulation is yet to happen though according to the analysts. However, the number of miners based in low-cost regions such as the Czech Republic, Iceland and the U.S. has grown.

Earlier this week, JPMorgan also released another report indicating that bitcoin’s price could crash below $2,000 if bearish conditions persist. Specifically, JPMorgan analysts expect bitcoin’s price to fall to as low as $1,260 if the bear market doesn’t go away.

Bitcoin’s not the Digital Gold Anymore?

At the same time, the analysts said that bitcoin didn’t have any real value. The analysts argued that bitcoin would only make sense if investor’s faith in gold and the U.S. dollar was eroded:

“Even in extreme scenarios such as a recession or financial crises, there are more liquid and less-complicated instruments for transacting, investing and hedging.”

In December, JPMorgan also issued a research note which indicated that the crypto bear market was turning off institutional investors.

At the time, JPMorgan’s global market strategist Nikolaos Panigirtzoglou said that interest in bitcoin futures was declining with the fall in cryptocurrency trading volumes.

Author: Mark Emem 
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Humanity Can’t Survive Digital Age Without Crypto: Circle CEO Jeremy Allaire

By Circle CEO Jeremy Allaire says humanity can’t survive the digital age without crypto because its decentralized nature and resiliency make it indispensable. Allaire made the remarks at the 2019 World Economic Forum in Davos, Switzerland.

Allaire says cryptocurrency skeptics are merely that way because they’re unfamiliar with the new technology.

‘Cryptography is Fundamental to the Future’

“People throw around ‘crypto’ like it’s a bad thing — it’s scary,” Allaire said January 23. “Guess what? Cryptography is at the foundation of protecting modern society, human privacy. It’s a fundamental tool of our cyber defenses. It’s a fundamental tool of every corporation.”

Allaire pointed out that modern society relies on digital infrastructure. Accordingly, humanity ultimately won’t be able to survive the digital age without digital currencies.

“Crypto is fundamental to the future,” he said. “We need tamper-proof, resilient, decentralized infrastructure if we want society to survive the digital age.”

“We see this as much more transformative even than the web. We think this has a long arc that will have a far greater impact on our civic institutions and our economic institutions.”

world economic forum crypto jeremy allaire
Circle CEO made the case for cryptocurrencies at the 2019 World Economic Forum in Davos.

Allaire: Cryptos Can Coexist with Central Banks

Some believe that traditional bankers love to trash crypto because they’re secretly threatened that cryptocurrencies will render legacy financial institutions obsolete. However, Jeremy Allaire insists that central banks and the crypto ecosystem can co-exist.

“We’re huge proponents of central bank digital currency and we believed in that for a very long time,” Allaire says. “Our view is that the creation of cryptocurrencies that are based on central bank money is happening in the private sector first. We launched USD Coin last fall. It’s growing rapidly.”

Allaire says cryptocurrencies are versatile because they can run over a blockchain that works interoperably with tens of millions of digital wallets around the world.

“It can be used in lending transactions, in payment transactions. It allows you to make dollar payments, globally, at pennies and in seconds to minutes. It’s a really powerful innovation.”

Allaire: Bitcoin Price Will Soar Within 3 Years

Jeremy Allaire basically double-downed on his bullish outlook from December 2018. At the height of the bear market, Allaire predicted that the bitcoin price will rocket over the next three years.

Regardless of its daily price, Allaire believes bitcoin has a “very significant role” to play as a scarce, non-sovereign store of value.

PayPal CEO and BoE Adviser Diss Bitcoin at Davos

However, not everyone at Davos is bullish about cryptocurrencies.

As CCN reported, Huw van Steenis — the senior adviser to Bank of England Governor Mark Carney — trashed crypto as worthless.

Similarly, PayPal CEO Dan Schulman is skeptical that bitcoin will achieve mass adoption by merchants because he says it’s not a currency and it’s inconvenient.

“We’re not seeing many retailers at all accept any of the cryptocurrencies,” Schulman said.

Some on Twitter reacted to Schulman’s anti-bitcoin shade by noting that less than 1% of the world used PayPal when it first launched. And look at it now. So the moral is: Revolutions take time.

Jeremy Allaire Image from DLDconference/YouTube

Author: Samantha Chang  
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Crypto is Worthless, Fails Basic Financial Tests: Bank of England Adviser

By Legacy banks are not worried about crypto because it has no value and fails the fundamental tests of financial services. That’s the assessment of Huw van Steenis, the senior adviser to Bank of England Governor Mark Carney.

Van Steenis says while traditional banks are always trying to fend off competition from new fintech platforms, he’s not losing any sleep over cryptocurrencies like bitcoin.

Van Steenis: Crypto Market is Small Potatoes

“I’m not so worried about crytocurrencies,” Van Steenis tells Bloomberg (video below). “They fail the basic tests of financial services.”

They’re not a great unit of exchange. They don’t hold value, and they’re slower.

Van Steenis made the remarks from Davos, Switzerland, where the 2019 World Economic Forum is being held this week.

Van Steenis’ cavalier attitude toward bitcoin mirrors the anti-crypto sentiments of financial analyst Gary Shilling. As CCN reported, Shilling’s eponymous New Jersey investment firm is shorting bitcoin because it’s “some kind of a grand Ponzi scheme.”

Shilling also says bitcoin fails as a currency because it’s not a store of value or a medium of exchange.

When asked if bitcoin has staying power, Huw van Steenis conceded that legacy financial institutions are always vigilant about maintaining their competitive edge and market share. But for now, he does not believe that bitcoin or any other crypto is a viable challenge to the dominance of big banks.

“Traditional banks are trying to fend off the threats from these new tech platforms,” Van Steenis admitted. “But cryptocurrencies aren’t high on my worry list.”

Van Steenis says his top priority is to make sure that the United Kingdom emerges as a “vibrant center” for fintech over the next five to 10 years.

BoE Boss: Crypto Not a Threat to Global Economy

Meanwhile, van Steenis’ boss — Bank of England Governor Mark Carney — said in March 2018 that the crypto industry does not threaten the stability of the global economy.

Carney — who’s also the chair of the Financial Stability Board — made the statement in a letter to the G20 finance ministers and central bank governors.

Carney also noted that the innovative technologies underpinning cryptocurrencies like bitcoin could bolster the global economy if implemented properly.

The FSB’s initial assessment is that crypto-assets do not pose risks to global financial stability at this time.

This is in part because they are small relative to the financial system. Even at their recent peak, their combined global market value was less than 1% of global GDP.

The technologies underlying them have the potential to improve the efficiency and inclusiveness of both the financial system and the economy.

British MP: UK Should Get Ahead of the Curve

Despite van Steenis’ wholesale dismissal of crypto as a viable currency alternative, some British lawmakers beg to differ.

As CCN reported, Eddie Hughes ― a member of the British Parliament ― wants UK residents to be able to pay their local taxes and utility bills using bitcoin.

In December 2018, Hughes said it was time for other members of Parliament to familiarize themselves with crypto because it’s not going away anytime soon.

“It gets talked about a lot wherever you go in the UK, and as MPs we have a duty to understand it,” Hughes said.

Moreover, Eddie Hughes is urging the UK to “plant a flag” and become a world leader in the burgeoning crypto industry.

You’re either ahead of the curve or you’re behind the curve. We are at a crossroads and we’re about to determine our future – one in which taking the lead in this field could prove very beneficial.

Author: Samantha Chang
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Huobi’s Crypto Derivatives Market Has Already Passed $20 Billion in Trades

Huobi Global CEO Livio Weng

Launched in November, Huobi’s crypto derivatives market is growing at a rapid pace. Fifteen days ago they revealed they had hit $10 billion in total volume, and today they announced they’ve seen $20 billion. In a note provided first to CCN, Huobi describes the timeline of the Derivatives Market in this way:

  • November 21: Huobi DM launches in beta mode with BTC contract trading
  • December 5: Huobi DM launches ETH contract trading
  • December 10: Huobi DM exits beta mode and is integrated with Huobi Global, Huobi’s flagship cryptocurrency exchange. Huobi DM’s daily trading volume reaches $195 million for the first time
  •  December 25: Huobi DM’s 24-hour trading volume breaks through $1 billion for the first time
  • December 28: EOS contract trading added. Reaches $10 billion in cumulative trading volume
  • December 31: Huobi DM’s first-month cumulative trading volume reaches $12 billion
  • January 12: Huobi DM’s total cumulative trading volume breaks through $20 billion

Futures Trading for the Crypto Industry currently offers derivatives on three major cryptocurrencies: Bitcoin, Ethereum, and EOS. Each has weekly, bi-weekly, and monthly markets. It works like any other derivatives market, except the assets are based on cryptocurrency rather than traditional commodities. According to the trading guide, positions can be closed before they’re filled, similar to other markets.

Huobi Global CEO Livio Weng said:

This reinforces our belief that Huobi DM truly caters to our user’s needs. We’ve been getting positive feedback from our clients on our lack of clawbacks as well as Huobi DM’s capacity to help sophisticated traders manage the risk of spot market fluctuations. I believe this explains our platform’s exploding growth, even in the midst of the ongoing bear market.

The positive response will likely lead to the addition of other markets. As a whole, Huobi is one of the largest crypto exchanges in the world by volume. At the time of writing, Huobi had done over $290 million over the 24-hour period.

All of these metrics come amid an overall down cryptocurrency market. Huobi’s US partner, HBUS, recently took over as part of its strategic marketing push. Huobi volume is representative of its trading pairs. Despite desktop clients and innovative trading platforms, those who capture the most of the crypto market are those with the most listings. This is fundamental to the success of Binance.

Author: P.H. Madore 
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How the US Government Shutdown Is Halting Crypto Progress on Wall Street

The longest government shutdown in U.S. history is hurting the crypto industry, too.

As the impasse in Washington stretches into its record-breaking fourth week, the closure of the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) has put key developments – namely, the approval and launch of products and services involving cryptocurrencies – on hold.

Notably, the launch of Bakkt’s bitcoin futures market was delayed in part by the company’s inability to secure approvals before Dec. 22, 2018, when the shutdown began. The platform, created by Intercontinental Exchange (parent of the New York Stock Exchange), is in a holding pattern until regulators can open a 30-day public comment period. A new launch date for the platform, which most recently was set for Jan. 24, has yet to be announced.

This lack of approval has not deterred Bakkt from building up its platform: the company announced Monday it was acquiring parts of independent futures commission merchant Rosenthal Collins Group (RCG) to bolster its regulatory compliance chops.

“We made great progress in December,” Bakkt CEO Kelly Loeffler wrote in post published on Medium on New Year’s Eve, “and we’ll continue to onboard customers as we await the ‘green light.’”

Other startups are in a similar state of limbo.

ErisX, a trading platform that recently raised $27.5 million from prominent investors, is also waiting for furloughed federal employees to return to work. The platform aims to be a regulated futures market and clearinghouse, which requires approval from the CFTC.

“ErisX’s interaction with the CFTC has been both positive and productive,” CEO Thomas Chippas told CoinDesk, adding:

“During this government shutdown we have continued our platform development efforts. We look forward to this current impasse being resolved and re-engaging with [CFTC] staff on our DCO [derivatives clearing organization] application.”

When ETF?

Exchanges aside, even certain products are now potentially at risk.

Perhaps one of the most highly anticipated bitcoin-related products is an exchange-traded fund, or ETF. The SEC currently has one rule change proposal sitting before it, filed by VanEck, SolidX and Cboe.

The proposal has already been delayed a number of times, and now faces a final deadline of Feb. 27. If the SEC does nothing, under existing law, the proposal would be approved. Specifically, Title 15 of the U.S. Code states that any proposed rule changes “shall be deemed to have been approved by the [SEC] if … the [SEC] does not issue an order approving or disapproving the proposed rule change.”

However, some legal experts say an approval-by-default is unlikely to happen, even if the shutdown drags on.

Ethan Silver, chair of the broker-dealer practice at law firm Lowenstein Sandler, anticipates that, should the shutdown continue, any staffers who remain on duty would reject the application.

“I think if they were forced to deal with it, they would sooner deny it than be put in a position [where it is approved on a technicality],” he said, explaining that the regulator would likely cite “market integrity” or a similar emergency contingency as a reason for the denial.

Similarly, Jake Chervinsky, a lawyer with Kobre & Kim, said on Twitter that the SEC would likely find some way to reject the proposal during a protracted shutdown, a view also shared by attorney David Silver of the Silver Miller law firm.

The commission has yet to approve any crypto ETFs, rejecting nearly a dozen in 2018. That has not yet deterred companies from trying to be the first to bring such a fund to market, however. Just last week, Bitwise Asset Management announced its intention to launch a bitcoin ETF with NYSE Arca.

While the company has filed an initial registration form, NYSE Arca has not yet submitted the rule change proposal, and so the SEC cannot yet consider the ETF.

Please advise

Beyond launches, the crypto space – at least in the U.S. – is still waiting for increased clarity and official guidance on how to safely handle digital assets.

Vince Molinari, co-founder of the regulated trading platform Templum, told CoinDesk that initiatives the SEC may have planned, such as guidance on custody, are likely to be delayed.

“I think the entire space gets pushed back,” he said. “It could be a quarter or two before things go back, it could be longer depending on how long the shutdown’s in effect.”

Compounding the issue, he noted, is that even after the shutdown ends, staffers have to catch up on anything they missed during the furlough.

“There’s talk about the [initial public offering] calendar being pushed back,” he said.

Mining manufacturer Canaan is at least one crypto firm reportedly considering a U.S. IPO. While the company is said to be in the early stages of this decision, Molinari believes an extended shutdown could postpone IPO approvals “indefinitely.”

The issues mirror those faced by the financial technology sector in the U.S. more broadly, as noted in an analysis piece published by Roll Call, a news site focused on the U.S. federal government.

Roll Call noted that the CFTC, which has requested information on ether and the ethereum network, is unable to review any comments already submitted. In its request for information, the CFTC noted that any submissions would “advance [its] mission of ensuring the integrity of the derivatives markets,” which may indicate the regulator is assessing a potential ether futures market.

Eyes on the Hill

As regulatory activity slows to a halt, a crypto industry group is focusing its efforts on Capitol Hill, where lawmakers in the House and Senate are still open for business.

“We’ve been making real progress engaging with lawmakers and regulators on the merits of the token economy in the last several months, but the shutdown puts the handbrake on some of those conversations,” Kristin Smith, director of external affairs for the Blockchain Association, told CoinDesk.

She added:

“There are pressing concerns on a number of fronts – taxes, SEC guidance, Treasury guidance – and the shutdown, at the very least, pushes those issues to the back burner for the foreseeable future.”

The SEC could not be reached for comment. When contacted via email, a spokesman’s auto-reply explained:

“Due to a lapse in appropriations for the federal government, the U.S. Securities and Exchange Commission is currently closed. I am currently out of the office, and will return to the office once an appropriation has been enacted. During the closure, I will not be monitoring or responding to my emails. Thank you.”

Author: Nikhilesh De, Zach Seward 
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Federal Reserve Blames Altcoins for Dragging Down the Bitcoin Price

The Federal Reserve Bank of St. Louis has released an article today about Bitcoin. In it, the bank notes that the price of Bitcoin has three potential futures: indefinite, infinite appreciation; zero; or somewhere in between. They believe it will be somewhere in between.

The authors, David Andolfatto and Andrew Spewak, conclude that one of the factors dragging down the price of Bitcoin is an ever-expanding supply of alternatives. Bitcoin is an inherently speculative and volatile asset. A fixed supply doesn’t mean an ever-increasing value. Demand determines value, after all. Other tokens are frequently launched which have properties attractive to a portion of the market. If Bitcoin was still the only cryptocurrency, something which was only the case for a very brief time in its history, this money would probably go into Bitcoin.

Bitcoin Maximalists Ignore Important Realities

However, the Bitcoin maximalist argument that Bitcoin will simply usurp any improvements by other tokens has never come to fruition. There are even fewer dApps and users of dApps via Bitcoin’s blockchain than much later entrants like Tron.

The Federal Reserve economists write:

Consider the following thought experiment. A restaurant selling meals for $10 will happily accept payment in the form of one Hamilton bill ($10) or two Lincoln bills ($5). That is, the nominal exchange rate between Hamilton and Lincoln bills is 2:1. Now, suppose that the supply of Lincoln bills is increased but the supply of Hamilton bills remains the same. The exchange rate remains unaffected […] That is, the increase in the supply of Lincoln bills has led to a decline in the purchasing power of both Lincoln bills and Hamilton bills, even though the supply of Hamilton bills has remained fixed. Might an expansion in the supply of Altcoin have a similar depressing effect on the price of Bitcoin?

There are other complicating factors to the price of Bitcoin. On the one hand, it is the cryptocurrency with superior liquidity. This makes it the on-ramp and off-ramp for many other cryptocurrencies. Does anyone remember when ICOs were primarily conducted for Bitcoin? Nowadays Ethereum performs that function. Importantly, ICOs fueled demand for Ethereum through 2017 and 2018. Ethereum has a large supply and may never stop producing new units. Therefore, its lower values make sense: the more available something is, the less value it is.

Federal Reserve on the Intrinsic Value of Cryptocurrencies

The article also speaks to “intrinsic value.”

Consider now the bearish case for Bitcoin. This outlook is based on the view that Bitcoin has no fundamental value and that sooner or later the market will recognize this fact. In our view, one can accept that Bitcoin trades above its fundamental value without claiming that its fundamental value is zero. In fact, many securities trade above what might be considered their fundamental value. Gold, for example, trades above its value as measured by its industrial applications.

As noted before, Bitcoin’s actual utility is a secure digital store of value and transfer of the same. Other blockchains have taken and dominated the “blockchain” aspect of cryptocurrency. Despite the global chaos, demand for cryptographically secure payment systems isn’t necessarily popping. But it is feasible that people will come into contact with blockchain technologies through banking applications as well as other decentralized applications. Such things will generate demand for tokens that underpin those blockchains. Tokens like Ethereum, TRON, NEO, Aelf have a long-term technical proposition that Bitcoin has long been lagging on.

Smart Contracts Change The World

Bitcoin as a smart contract platform is probably a dream at this point. For one thing, it’s significantly more expensive to use. For another, at this point, other platforms simply do it better. The trend of alternatives taking up more and more of the total cryptocurrency market capitalization is likely to continue. Bitcoin maximalists rest on flawed arguments such as “network effect.” These arguments conveniently ignore historical examples where superior technology and marketing overtook dominant networks.

Bitcoin is likely not to trend downwards toward zero. The economists acknowledge this as well. But the odds are that an increasing amount of cryptocurrency market capitalization will enter through and be invested in alternatives with growing demand based on their usefulness.

After ten years, Bitcoin remains more a speculative asset and store of value than anything. The trend the Federal Reserve economists identify is representative of that. There are numerous factors that go into an actual downturn in the price of Bitcoin. A good percentage of holders will not sell at a loss. Another good percentage will not sell at all. These people hold the coin’s price at a certain level. But active trading can eventually reduce the price without regard to these people’s philosophical or strategic holding patterns.

No One Knows the Actual Value of Bitcoin

The Bitcoin price, at the time of writing, was $3,641, but what is the asset really worth?

Bitcoin and all other cryptocurrencies very much remain in a price discovery phase. Some believe Bitcoin was overbought in the hype bubble of 2017, which inherently raised the price of nearly every other crypto available. Others believe it was just a fluke. Institutional money is still only just entering the picture. The utility of Bitcoin is only one aspect of its value, but it will play an increasingly important role as others develop more advanced and attractive feature sets.

As the Federal Reserve economists said:

We think the future price path is more likely to remain bounded between these two extremes.

Zero? No. Endless incline without significant change to the demand climate? Certainly not. Look out, Bitcoin. The 2000s called and they want their basic crypto design back. The era of smart contracts is dawning. Whoever does it best will see the most demand. It’s probably that simple.

Disclaimer: The views expressed in the article are solely those of the author and do not represent those of, nor should they be attributed to, CCN.

Author: P. H. Madore
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Tron Price Rises 53% in Five Days – Is This TRX Run Sustainable?

The Tron price (TRX) on Wednesday maintained its bullish momentum despite a watchful sentiment across other cryptocurrencies.

The TRX/USD rate today peaked towards 0.0306, up 53% for the week after posting five consecutive daily buying sessions. On a 24-hour adjusted timeframe, the pair has posted a whopping 13.56% gain against the US dollar. The strong buying sentiment has prompted Tron’s market capitalization to jump two ranks, leaving Craig Wright’s Bitcoin SV and stablecoin Tether behind.

Tron is also showing strong muscles against Bitcoin. According to an aggregate price index, the TRX/BTC pair has jumped 13.15% to 722 satoshis.

BitTorrent Token Launch

The upside sentiment appears to have surged after the launch of the BitTorrent crypto token (BTT). It is the native cryptocurrency of the BitTorrent protocol, the popular torrent file sharing platform which Tron took over last year. According to the press announcement, BitTorrent users will be able to earn rewards for seeding and sharing the files in BTT. According to the BitTorrent whitepaper, BTT is based on Tron’s TRC-10 standard.

CZ, the CEO of crypto exchange Binance, called the development an “interesting case study.”

The overall development appears to have attracted sentimentalists towards the Tron market, especially when rest of the top coins are finding it difficult to reach their next upside targets. The crypto token’s surge against Bitcoin alone explains that.

Will the Tron Rally Last?

The signs of sentimental trading suggest that traders will want to exit their long positions on a profitable note on the first sign of pullback action.


The TRX/USD rate has overreached its upside targets according to the Relative Strength Indicator (RSI) momentum. It is now near 80, which indicates a downside correction in the coming sessions. In the best case scenario, the TRX/USD pair will be forming a bull flag as it corrects to the south, after which it will resume its uptrend to form new higher highs. In the other scenario, which is not entirely a worst case, the pair will extend its downside correction to restest 0.0182 as its support.

As of now, Tron has already formed what the market calls a cup and handle pattern, followed by a breakout. Generally, the cups with stronger Us and handle size below the size of half the cup provide strong signals. We are merely discussing the pattern to realize the interim bias of the Tron market.

In the event of an extended breakout action, such that TRX/USD breaks above 0.0310, the next upside target would shift towards 0.0443, the high from July 18 trading session.

Author: Yashu Gola
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Here’s Why Bitcoin’s Future is so Bright: Digital Currency Group Exec

Digital Currency Group’s Travis Scher (Twitter)

Bitcoin tanked in 2018, but the future of cryptocurrencies remains bright because you can’t stop progress. That’s the assessment of Travis Scher, a vice president at crypto investment firm Digital Currency Group.

“2019 will be volatile, entertaining, and full of surprises,” Scher wrote in a Medium post. “But I am confident that the stress caused by the 2018 crash will lead to more growth.”

Scher admitted that 2018 was a challenging year for cryptocurrencies. Accordingly, “there are good reasons for pessimism and disillusionment as 2019 begins,” he conceded.

However, Scher — an attorney who previously worked at the white-shoe law firm Skadden Arps — said the crypto community is addressing key underlying issues that have held it back.

Scher outlined the steps the industry must take to bolster its credibility and move toward mainstream adoption.

(1) The Industry Must Engage with Regulators

First, it is critical for the industry to work with lawmakers to adopt appropriate regulation, Scher said. Doing so will promote the industry’s legitimacy and therefore, advance mainstream adoption.

“Regulation is the most important topic in crypto today,” Scher said. “How regulators decide to treat cryptoassets and crypto companies will be a huge determinant of this industry’s success.”

Travis Scher: “Regulation is the most important topic in crypto today.” (Pixabay)

As CCN reported, this is why Digital Currency Group, Coinbase, and Circle launched a pro-crypto lobbying group in September 2018.

This shows that the industry is serious about working with legislators to protect consumers, and thereby, earn mainstream acceptance.

The industry needs to proactively and effectively make the case that this industry can be a powerful force for good.

Jeremy Allaire, the co-founder of Circle — a crypto unicorn with a $3 billion valuation — agreed. “We have been very active with Congress, with policymakers,” Allaire said.

(2) Prepare for More Layoffs and Shutdowns

Travis Scher said we should also expect to see more layoffs, company closures, and bankruptcies in 2019.

“Crypto companies need to tighten their belts and prepare for a long winter,” Scher warned. “Token sales will be hard to execute not just because of uncertain regulation, but because liquidity has dried up.”

The crypto funds that raised hundreds of millions at the peak of a bubble suffered horrific losses in 2018, and many will shutter this year.

Scher said this consolidation is inevitable because the industry grew too fast amid the market hysteria, so a period of normalization is here. And that’s not a bad thing.

(3) Industry Needs a ‘Darwinian Evolution’

While some companies will shutter, the good ones will get even better, Scher projected.

“A little Darwinian evolution is just what the industry needs,” Scher observed. “The easy money in 2017 and early 2018 bred a lack of discipline and…straight-up arrogance.”

Companies with shaky foundations will get washed out in 2019. But those that are well-run and mission-driven will end up even stronger.

One example of a high-flying company that was forced to downsize was blockchain startup ConsenSys. After doubling its workforce in 2018, the company abruptly laid off as much as 60% of its staff in December 2018.

ConsenSys CEO Joseph Lubin, the co-founder of Ethereum, said ConsenSys had to eliminate underperforming projects to cut costs after the group got too big and unwieldy.

(4) Prepare for Entry of Institutional Money

Scher said the media hype surrounding the expected influx of institutional investors is not a lie.

“This is very real  — companies like Goldman Sachs, Fidelity, and ICE are publicly making big moves in the space,” Scher said.

Beyond high-finance, Square and Robinhood have made aggressive inroads into crypto, and now Facebook is rumored to be launching a stablecoin.

Scher said a sea change looms on the horizon for the crypto market, which is why the current (and temporary) Crypto Winter does not faze him. Scher said one of the best parts of crypto’s watershed 2019 will be laughing in the faces of the gloating naysayers when they’re forced to eat their words.

“The change-averse corporate executives who have derided crypto will be embarrassed when their dismissive quotes resurface down the line,” Scher promised.

Author: Samantha Chang
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