Want a Bitcoin Tax Refund? You Might Need an Accountant

It’s tax season again, and unlike last year at this time—when many Bitcoin investors were sitting on exponential 2017 gains—there may be another reason for cryptocurrency holders to file their taxes: the possibility of a Bitcoin tax refund.

The price of Bitcoin fell nearly 74% in 2018, making it likely that many people sold their cryptocurrency last year at a loss. And just like the IRS requires paying taxes on capital gains, so too can losses be deducted on tax forms, lessening what tax filers owe or increasing their eligibility for a tax refund.

But figuring out the Bitcoin price when you bought it—also known as cost basis—and the price at which you sold it may be harder than it seems, says Jake Benson, founder and CEO of Libra, which built the first cryptocurrency tax calculator. That’s because the IRS does not require cryptocurrency brokers to provide clients with the traditional form, known as a 1099-B, that stock brokers must use to provide such information to customers, Benson explains on the latest episode of Balancing the Ledger.

“The burden is left upon the fund or the individual that’s trading to track cost basis, and this is extremely challenging,” says Benson, calling on the IRS to update its guidance on the issue. “Some customers track their cost basis, some rely on proceeds, and it’s a really challenging scenario.”

TurboTax and H&R Block—the mainstays of do-it-yourself tax filing—may not be sufficiently versed in the complexities that come with cryptocurrency trading, Benson adds, so many people might want to seek out an accountant specializing in crypto.

Libra works with institutional cryptocurrency investors and firms, including Circle and Mike Novogratz’s Galaxy Digital, helping them calculate their investment performance and net asset value (NAV), and produce financial statements for auditors—some of whom are also Libra clients.

Those services could also be a stepping stone towards the approval of a Bitcoin ETF, or exchange-traded fund. The U.S. Securities and Exchange Commission (SEC) has rejected multiple applications for a Bitcoin ETF, citing a lack of oversight and safeguards, as well as concern that it would be difficult to consistently calculate NAV, and that Bitcoin trading “seems impossible to audit effectively.”

Benson, however, thinks Libra may be able to help with at least some of those problems. “I think it is currently being solved,” Benson says. “We’re not solving every piece of the infrastructural issues, but on an auditability side, on an evaluation side, yes, that is what we focus on.”


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Author: JEN WIECZNER
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IoT Crypto VeChain Price Surges 50% Overnight, Factors Behind the Spike

VeChain, a China-based Internet of Things (IoT)-focused crypto, has surged by more than 50 percent in value within the past 24 hours.

Analysts have attributed the increase in the price of VeChain to the successful series of partnerships the team has been able to secure since earlier this year and the improving momentum of tokens in the global cryptocurrency market.

LIONBIT

Major Partnerships

VeChain/USD | Source: TradingView

In May, CCN reported that Pricewaterhousecoopers, a “Big Four” auditor better known as PwC, acquired stake in the Chinese cryptocurrency with the intent of utilizing the VeChain IoT network to serve multi-billion dollar clients and conglomerates that rely on the services of PwC.

At the time, Raymund Chao, the chairman of PwC Asia Pacific and Greater China, said:

“We are glad to establish a deeper relationship with VeChain, which aims to build a trusted and distributed business ecosystem to help address long-standing challenges in supply chain management, food trust and anti-counterfeiting areas. VeChain’s mission aligns with PwC’s purpose of solving important problems and building trust in society.”

The involvement of PwC has been crucial for VeChain’s performance over the past three months because it meant large-scale conglomerates have to started to demonstrate interest in the VeChain blockchain protocol.

The strategic partnership between PwC and VeChain in May was especially valuable because PwC acquired a small ownership interest in the VeChain network, with the plan of collaborating with the VeChain development team as an investor, not as a client.

It is important to acknowledge the participation of PwC in the long-term growth of VeChain because the vast majority of partnerships secured by blockchain projects in the cryptocurrency sector are often deals that state multi-billion dollar conglomerates as the beneficiaries.

TIP

For instance, many projects have claimed to have secured strategic partnerships with major firms in the technology sector such as Google and Microsoft, but the actual nature of the deal revolved around the projects paying the conglomerates for their services, not the other way around.

Since May, VeChain has aggressively expanded its services internationally, winning a contract with the government of China to develop a vaccine tracing solution.

Despite the Chinese government’s ban on cryptocurrency trading, it has allocated more than $3 billion in 2018 alone to state-funded blockchain funds, primarily to finance blockchain startups and innovative technologies.

This month, China’s Ministry of Information Technology ordered local financial authorities and agencies to speed up the development and commercial implementation of the blockchain, which will positively impact companies like VeChain that are actively cooperating with the Chinese government.

“The industry remains in a nascent stage. While the technology has brought benefits, it could also bring risks such as technical loopholes, and challenges to current systems and norms, the ministry said. The ministry also said it will work with local authorities to push for healthy and orderly development of the industry,” the report of Xinhua, a state-owned publication, read.

Other Factors

The abrupt price surge of VeChain was evidently fueled by the general recovery of the cryptocurrency market and the re-established momentum of tokens. But, the valuable partnerships the company has been able to secure since early 2018 drove its recent momentum and will likely continue to positive impact its long-term growth.


IZX

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What Would Happen to Crypto In a Global Market Meltdown?

A common thought experiment in the crypto community is to ponder how cryptocurrencies would fare in the event of another global financial meltdown.


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It is not an idle question. There is a host of troubling developments in the global economy: the threat of a trade war, jitters in Italian debt markets, problems at Deutsche Bank and new emerging market crises in Turkey and Argentina.

Meanwhile, central banks, led by the U.S. Federal Reserve, are tightening or signaling tighter monetary policy. That’s putting a brake on the huge gains that low interest rates and quantitative easing had bestowed on global markets in the eight years since the end of the last crisis.

With this combination of risk factors already in play, there’s always a chance that some unforeseen trigger could set off another terrified rush for the exits among global investors.
What would the impact be on bitcoin and other cryptocurrencies? Would their reputation as independent assets see them benefit from safe-haven inflows? Or would the market-wide reduction in risk appetite spread wide enough that crypto assets get caught up in the selloff?

Opposing scenarios
Some crypto hodlers salivate at the idea of market panic.
They contend that, unlike the 2008-2009 collapse, when Satoshi Nakamoto’s newly launched cryptocurrency was essentially out of sight and unavailable to the hordes seeking a haven from the fiat world’s chaos, bitcoin is now widely recognized as a more versatile alternative to traditional flight-to-safety assets such as gold.

In a crisis, they say, bitcoin could shine – as might other cryptocurrencies designed as alternatives to fiat cash such as monero and zcash. Unaffected by future monetary policy responses, immune from draconian interventions such as the Cypriot bank deposit freeze of 2013, and easily acquired, they could prove their value as digital havens for the digital age in such a moment. Accordingly, the bulls’ argument goes, their prices would surge.
On the other hand, if there’s enough of a market-wide departure from risky investments, it’s hard not to see this sector being swept up in it.

Just as the most extreme gains in crypto prices in the latter part of 2017 were inextricably linked to the rapid “risk on” uptrend seen in stocks, commodities and emerging-market assets, so too a major selloff could easily infect these new markets.


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Cryptocurrencies and tokens are perceived by most ordinary investors as high-risk assets – you buy them with money you can afford to lose when you’re feeling upbeat about market prospects. When the mood sours, this class of investment is typically the first to be retrenched as investors scramble to get cash.

At $300 billion, according to Coinmarketcap’s undoubtedly inflated estimates, the market cap of the overall crypto token market is more than three times its value of a year ago (even though it’s down more than half from its peak in early January).
But it’s less than 1 percent of the end-2017 market cap of $54.8 trillion for the S&P Global Broad Market Index, which includes most stocks from 48 countries. If risk-hungry investors are panicking and looking for things to dump – or for that matter if they’re looking for something safe to buy – it won’t take much of their funds to move the crypto markets, one way or another.

Low correlations
Backing the bitcoin bulls’ argument is the fact that correlations between cryptocurrency and mainstream risk assets – the degree to which prices move in tandem with each other – are quite low.
A 90-day correlation matrix compiled by analytics firm Sifr put bitcoin’s correlation with the S&P 500 index of U.S. equities at minus-0.14. That’s a statistically neutral position since 1 represents a perfect positive correlation while -1 is a perfectly negative relationship.
But they say that in a crisis “all correlations go to 1.” The panicked state of the crowd, with investors selling whatever they can offload to cover debts and margin calls, means that everything could go out with the flood.

Intellectually, too, that sort of wholesale downturn would comfortably stand as a logical counterpoint to the conditions seen last year when market valuations reached excessive levels. We cannot separate the flood of money that flew into crypto at the end of the year from the fact that eight years of quantitative easing had driven a “hunt for yield” in once-obscure markets as the return shrank on now pricey mainstream investments such as corporate bonds.

With bond funds paying little more than, say, 2 percent for years, bitcoin looked attractive to mainstream investors. When that artificially-stoked liquidity disappears, the reverse could happen.

Despite all of this, I do believe a global financial crisis could be an important testing moment for crypto assets.

Perhaps there’ll be a two-phase effect. In the immediate aftermath of the panic, there would be a selloff as every market is hit by the liquidity squeeze.
But after things settle, one can imagine that the narrative around bitcoin’s uncorrelated returns and its status as a hedge against government and banking risk would gain more attention.

Just like the mid-2013 surge in bitcoin that accompanied the Cypriot crisis’ lesson that “they can come for your bank account but not for your private keys,” so too a wider financial crunch could spur conversation around bitcoin’s immutable, decentralized qualities and help build the case for buying it.

The wider point here is that, whether it’s as an aligned element that rises and falls in sync with the broader marketplace or as a contrasting alternative to it, cryptocurrencies can’t be viewed in isolation from the rest of the world.


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Author: Michael J Casey
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Does Seasonality Affect Bitcoin Prices?

“Sell in May and go away” is a well-known saying among stock investors all over the world. The idea behind it is that stocks have a tendency to rally when the new year starts in January, partly due to mutual funds and others positioning themselves for the year ahead, and partly because individuals who sold at the end of the year for tax reasons, are now buying up shares again.


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Following the rally at the start of the year comes a period of cooling interest in stocks over the summer. Many investors and traders take some time off, and there is little new money flowing into the markets. As a result, stock prices tend to decline during the summer months of June, July, and August.

However, when the summer holidays are over and fund managers are coming back to work again, the opposite seems to happen. Everyone is looking to bring their new plans and investment strategies to life, and put capital to work. In addition, traders are starting to position themselves for the expected “January-effect.”

As a result, stock prices generally start to go up as we head into the fall.

Seasonality in the bitcoin market
The question many bitcoin traders have is if it’s possible to follow the same logic to make money in the bitcoin market.

The short answer to that is that the bitcoin market appears to be a very different animal.
First of all, because of the globalized nature of the bitcoin market, “tax selling” doesn’t seem to have the same type of impact as it has on stocks.


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Another factor is the fact that the bitcoin market is largely driven by individual traders and investors who are often young and have little prior experience with investing. Compared to what the case is in traditional financial markets, there are very few institutions that are involved with bitcoin and cryptocurrencies.

One thing that makes it difficult to study how seasonality impacts bitcoin prices is the relatively short history of bitcoin. There is really not enough data available to be able to say something statistically significant about seasonal patterns of bitcoin prices over the course of a year.

Despite this, we can spot some indications that may be worth exploring further and taking note of in the years to come.

Bitcoin sell-off expected?
While the media has been freaking out about the sell-off in bitcoin this year, industry insiders and crypto market analysts have repeatedly pointed out that the heavy selling we have seen in the bitcoin market this year is nothing new.

In fact, it is something that can be expected to occur every year to a varying degree, and something we have seen happen again and again in this market.

Let’s take a look at what has happened early in the year for the past four years in the bitcoin market (keep in mind that these numbers are approximate):
2014: 60% decline by April before a brief recovery period
2015: 70% decline over the first two weeks of January before the market recovered
2016: 20% decline over the first three weeks of January before the market recovered
2017: 25% decline over the first two weeks of January before the market recovered
2018: 70% decline by February before a brief recovery period, followed by another sell-off
It’s not hard to see a pattern in these numbers, and it definitely seems to be a reoccurring phenomena in the bitcoin market.

So what can we learn from this? Well, we can say one thing for sure: The same “January-effect” as we see in the stock market clearly does not exist in the bitcoin market. Instead, the opposite scenario seems more likely.

If we look at the S&P 500 stock index in the US, we saw strong growth both in the beginning of 2017 and 2018, although the years prior to that saw more stable or even slightly declining markets.

Although the data presented here is far from enough to draw any definitive conclusions, it seems fair to assume that bitcoin prices do not follow the same seasonality as stock prices. While the end of each year appears to be a particularly good period for bitcoin, a sell-off in the beginning of the year is something we have seen again and again in this market.

As the bitcoin market matures, seasonal patterns will probably become even more prevalent and predictable, to the delight of all those who know what to look out for.



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Author: Fredrik Vold
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Market Manipulation in Crypto – What It Says About the Industry

The crypto community is in uproar after Twitter user @CryptoMedication published an article on Steemit, a blogging and social networking website, this week claiming his screenshots are proof that a number of Twitter influencers are doing pump and dump schemes, among other questionable and downright illegal market manipulation tactics.

In his article, he shares screenshots in which users can be seen debating market manipulation tactics, claiming to have connections at exchanges and news outlets. The screenshots do not seem to show them actually doing anything other than boasting and pretending they’re the next Wolf of Wall Street as if that’s something to be proud of.
Many participants in that conversation have come forward and tweeted that although they are “aware how bad this looks,” that CryptoMedication is a “very good writer” who is spreading FUD and that they are “targets” because of how big they are.

TheCryptoDog, another participant according to CryptoMedication, replied to our request for comment, saying that he has shared his side of the story with people he cares about and doesn’t want to make more of a story than it already is.


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Regardless of whether this group is manipulating the market or not, the crypto community suffers because of this event. If the group did manipulate the market, then it obviously suffers in the eyes of outsiders due to its unregulated nature that permits such events. If they didn’t, however, the mere idea of one anonymous user being able to paint a group of people in bad light and make it believable is proof of how little trust people have in the industry as a whole.

Phrases such as “crypto is a tool for criminals” are being thrown around ever since Bitcoin appeared, and especially after the Silk Road, an online black market, case. We, as insiders, may scoff at this idea because we know that the majority of enthusiasts truly want cryptocurrencies to take their place in daily life and trading. This event begs the question: is this opinion of the uninformed public, who consider crypto a criminal tool, not understandable? Do they not form their opinions from what they can see, the stories that gain traction and become visible outside of our community, such as this one?

These comments about the lack of regulation being dangerous, coming from government officials and authorities, make more sense when seen through this prism of a few people trying to seize control of an idea that was meant to be uncontrollable.

Whoever is at fault here – and if anyone is truly innocent – the damage from this event will be visible for a long time. Crypto tried to get away from centralization because of the potential for manipulation, but that will not stop malicious actors from trying to get rich quickly.

The bottom line would be, not for the first time, to do your own research – Twitter influencers are not financial advisors and if you lose money due to bad advice, you can only blame yourself. But to add to this, do your own research once again, and don’t take every story for scripture. Let the authorities decide who is guilty.


Here at Dollar Destruction, we endeavour to bring to you the latest, most important news from around the globe. We scan the web looking for the most valuable content and dish it right up for you! The content of this article was provided by the source referenced. Dollar Destruction does not endorse and is not responsible for or liable for any content, accuracy, quality, advertising, products or other materials on this page. As always, we encourage you to perform your own research!

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Author: Sead Fadilpasic
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A Guide to Crypto Terminology

General Terms

Bitcoin: the first decentralized digital currency, and currently the best known and most expensive;
Cryptocurrency: a digital asset designed to work as a currency, that uses cryptography to secure its transactions, to control the creation of additional units, and to verify the transfer of assets;
Blockchain: a continuously growing list of records, called blocks, which are linked and secured using cryptography, and acts as the basis for cryptocurrency due to its decentralization and immutability;
Decentralization: the property of not being owned or controlled by a single individual or group of people, thus being more resistant to inside manipulation;
ICO: short for Initial Coin Offering, a means by which funds are raised for a new venture, where some of the cryptocurrency is sold to early backers of the project;
Mining: the process of trying to ‘solve’ the next block to obtain an amount of cryptocurrency. In many cases it requires huge amounts of computer processing power;
Wallet: storage of ‘keys’, or codes, needed to access and use one’s coins. There are online (“hot”) wallets and offline (“cold”) wallets;

Technical Terms

Address: the location from which you would receive, send or hold your currency, generally manifested in a long string of alphanumeric characters;
Altcoin: “alternative coin”, any cryptocurrency that is not Bitcoin;
Distributed Ledger: an agreement of shared, replicable and synchronized data, in this case spread across multiple networks, across many computers;
51% Attack: a situation where more than half of the computing power on a network is operated by a single individual or concentrated group, which use this power to control a network;
Fork: a permanent divergence of an alternative operating version of the current blockchain; come into existence when a 51% attack occurs, a bug in the program, or more commonly a new set of consensus rules come into existence;
Multisig: needing more than one signature to approve a transaction;
P2P or Peer-to-Peer: a system where peers (equally privileged, equipotent participants) share resources amongst each other without the use of a centralized administrative system;
Smart Contract: It’s a computer code that simplifies the execution of certain agreements and eliminates the need for a middleman;

Trading Terms

Exchange: a website where you can buy and sell cryptocurrencies;
Fiat: government-backed cryptocurrency, such as the US dollar or euro;
Whale: someone who owns an obscene amount of cryptocurrency, so that their trading would move the market a lot, the way real whales displace a lot of water around them;
Margin trading: an act of ‘magnifying’ the intensity of your trades by risking your existing coins, often equated to gambling, and forbidden on many exchanges;
Bull/bullish: optimism for prices, the expectation that the price is going to increase;
Bear/bearish: pessimism for prices, the expectation that the price is going to decrease;
ATH: short for all-time high, the biggest value a cryptocurrency has ever reached;
Shilling/pumping: advertising another cryptocurrency by making it sound too good to be true;
Pump and dump: a fraud scheme that originated on Wall Street, where a group of people artificially increase the price of a coin, bringing attention to it, then sell it to unsuspecting victims and watch the price crash;
Bagholder: someone who still holds an altcoin after a pump and dump crash; alternatively, someone who owns a coin that is steadily falling;
Market cap: the total value of a cryptocurrency network, calculated by multiplying the total supply of coins by the current price of an individual unit;

Inside Jokes, Memes and General Abbreviations

HODL: a misspelling of “hold”, means to not sell your cryptocurrencies; alternatively described as meaning Hold On for Dear Life;
Lambo: short for Lamborghini, which is what cryptocurrency enthusiasts want to buy with their crypto trading profits, as opposed to Ferraris (because they’re a “Wall Street thing”);
“This is gentlemen”: originally a misspelling of “this is it, gentlemen”, but now used as a way to point out nice things, such as the rise of your coin of choice;
Mooning: a price going up astronomical levels; an alternative is, “to the moon!”;
FUD: Fear, Uncertainty, Doubt, a phrase that describes the heightened sense of panic and anxiety which can sometimes affect the prices on the market, usually caused by misinformation;
FOMO: Fear Of Missing Out, getting into cryptocurrency trading so that you do not miss out on the prices eventually surging and thus profiting you;
Shitcoin: an altcoin that turns out to be either worthless or downright scammy;
DYOR: Do Your Own Research, means do not trust everyone on the internet, instead research it by yourself or ask a professional;
Buy the Dip, Sell the Peak: the meaning is literal, if you want to profit, buy the coin when it’s at its lowest and sell it when it rises in price.


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Latest Bitcoin Price Forecasts: from Zero to USD 91,000

It has been a tough start to the year for cryptocurrency investors. The price of bitcoin is down by over 50% year-to-date, lawmakers are mulling over potentially restrictive global cryptocurrency regulations, and digital asset exchanges are finding themselves under increased scrutiny.

Some experts believe that the crypto bubble has popped while others believe that this is just a short correction before the rally continues to new highs.
In this article, we will explore and compare recent bitcoin price forecasts that were made by leading analysts and investors to get a better idea of what Wall Street is thinking about where the crypto asset market will go next.

Everyone Has an Opinion
It seems like not everyone wants to hold bitcoin as an investment but everyone has an opinion about it. Recent price predictions have ranged from bitcoin becoming worthless to exceeding the USD 90,000 mark within the next two years.
Harvard Unversity professor and economist Kenneth Rogoff told CNBC Squawk Box:
“Bitcoin will be worth a tiny fraction of what it is now if we’re headed out 10 years from now … I would see USD 100 as being a lot more likely than USD 100,000 ten years from now.”
Rogoff argues that “if you take away the possibility of money laundering and tax evasion, its actual uses as a transaction vehicle are very small.”
He believes that in the aftermath of the potentially upcoming wave of crypto regulations plus tax authorities’ newly found interest in going after wealthy bitcoin holders, the value of the currency will likely diminish to be worth a small fraction of where it is trading today.
Rogoff’s negative view on the future of bitcoin is shared by Stefan Hofrichter, Allianz Global Advisor’s head of global economics and strategy. In a recent blog post, he stated that “[bitcoin’s] intrinsic value must be zero”.

His argument for this conclusion is:
“A bitcoin is a claim on nobody – in contrast to, for instance, sovereign bonds, equities or paper money – and it does not generate any income stream.”
Hofrichter considers bitcoin as “a textbook case of a financial market bubble” that will likely still continue for a while but will eventually pop. He cites factors such as overtrading, easy monetary conditions, lack of regulation, increasing leverage, swindles, and overvaluation as key reasons why bitcoin is a bubble.

He also does not consider bitcoin a currency as its transaction fees and volatility are too high. Additionally, the high energy consumption of running the Bitcoin network makes it unsustainable in the long-run. Hence, he views bitcoin as a nothing but a bubble.
University of Pittsburgh researchers Carey Caginalp and Gunduz Caginalp share Hofrichter’s view that bitcoin has “no value by traditional measures”. They believe that:

“The cryptocurrencies may simply be a mechanism for a transfer of wealth from the late-comers to the early entrants and nimble traders”.

Outspoken New York University Professor and author Nouriel Roubini stated in a recent Bloomberg interview that bitcoin is the “biggest bubble in human history” and believes that this “mother of all bubbles” is now finally crashing.

Jon Matonis, economist and co-founder of the Bitcoin Foundation, disagrees and said, in an interview with Business Insider, that he remains confident that cryptocurrencies are not in bubble territory:
“Bitcoin is the pin that’s going to pop the bubble. The bubble is the insane bond markets and the fake equity markets that are propped up by the central banks. Those are the bubbles.”

LDJ Capital founder and chairman David Drake is also bullish on the “digital gold”. He told Bloomberg that he believes that the value of one bitcoin could reach USD 30,000 by the end of 2018. He thinks that as regulatory bodies get more involved in the cryptocurrency space the asset class become more legitimized. This, in turn, will attract more investors, especially from Wall Street, who will push the price of bitcoin and other cryptocurrencies to new highs.

Matonis’ and Drake’s optimism about the future of bitcoin is shared by Fundstrat Global Advisors’ lead analyst Tom Lee, who predicts that the price of bitcoin will hit USD 91,000 by March 2020.
Lee, who has emerged as one of Wall Street’s leading analysts covering bitcoin, has amassed substantial data about the digital currency, which he uses for his – usually accurate – price predictions. His collected data include the cost of mining, detailed trading trends data and technical analysis.
Lee and his team’s most recent analysis has concluded that after bitcoin’s last three 70% drops, the digital currency has always managed to hit new highs shortly thereafter. Based on this data, Lee believes that bitcoin could hit USD 91,000 within the next two years.
Big Disagreements and Common Themes

It is no surprise that the bitcoin “bulls” strongly disagree with the “bears” out there. The main focus of disagreement lies in whether bitcoin actually has intrinsic value or whether its value is purely driven by hype.

While the majority of financial experts agree that bitcoin – and cryptocurrencies in general – will likely be around for a little longer, some believe they will eventually become worthless while others believe that big things are still to come for crypto assets in the future.
A common theme among bitcoin “bears” is that they compare the decentralized digital currencies to existing asset classes and use traditional valuation models to evaluate the cryptocurrency market. However, to truly evaluate bitcoin, you need to look beyond established financial markets and understand that cryptocurrencies are an entirely new breed.

To evaluate cryptocurrencies new factors must be considered that economist and equity analysts not look at in the traditional financial markets. These include the number of active nodes, the daily number of transactions, the level of decentralization, adoption rates as well as the network effect, to name a few. Hence, any analysis of bitcoin and other crypto assets must incorporate valuations techniques that are tailored specifically towards this new digital asset class for it to carry any weight in this brave new world of investing in cryptographic assets.


Here at Dollar Destruction, we endeavour to bring to you the latest, most important news from around the globe. We scan the web looking for the most valuable content and dish it right up for you! The content of this article was provided by the source referenced. Dollar Destruction does not endorse and is not responsible for or liable for any content, accuracy, quality, advertising, products or other materials on this page. As always, we encourage you to perform your own research!

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Author: Alex Lielacher
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Bear Market ‘Largely Over,’ Crypto Fund Manager Claims

Timothy Enneking, managing director of Crypto Asset Managment, LP, said Monday that the winter in cryptocurrency markets is “largely over.”

Crypto Asset Management, which was founded last year and has roughly $20 million in assets under management, saw its CAMCrypto30 cryptocurrency index fall by 69 percent since its high in January. Enneking sees four reasons for the collapse.

Asset consolidation, regulatory concerns, massive liquidation by the Mt. Gox trustee and startups’ selling crypto assets to pay salaries and expenses are all factors in the market’s overall decline, he wrote.

“Consolidation after the amazing 2017 increase” drew back some of the funds invested in cryptocurrencies, he said.

 Investors are also likely wary due to recent regulatory actions. While he did not cite any specific events, the report comes just weeks after the U.S. Securities and Exchange Commission subpoenaed startups with initial coin offerings.

It remains unclear what exactly the SEC is looking for, though an official confirmed “dozens” of investigations were underway.

The other two reasons likely had less of an impact, Enneking said.

These factors have mostly been priced into the cryptocurrency market already, which, despite the recent rout, is still up by over 600 percent in the last 15 months, he wrote.

Enneking also noted that bitcoin’s share of the overall cryptocurrency market has fallen from 45.7 percent on Dec. 20 to 44.3 percent. This decline in “BTC dominance” has coincided with a decline in correlation between bitcoin and other cryptocurrencies, he wrote.

While the note does not comment on what declining correlation means, it could indicate that the quality of individual cryptocurrencies is beginning to have a greater influence on their market prices.

The combination of these factors indicate that the market should begin rebounding soon, he indicated in his report.

 


Here at Dollar Destruction, we endeavour to bring to you the latest, most important news from around the globe. We scan the web looking for the most valuable content and dish it right up for you! The content of this article was provided by the source referenced. Dollar Destruction does not endorse and is not responsible for or liable for any content, accuracy, quality, advertising, products or other materials on this page. As always, we encourage you to perform your own research!

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Author: David Floyd  
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