Category Archives: Cryptocurrency

A Year After $20K, Blockchain Capital Exec Says Investors Will Regret Not Buying in Now

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One year after Bitcoin (BTC) broke crypto industry records to hit $20,000, a partner at venture capital firm Blockchain Capital says that today’s bearish market represents “a fantastic buying opportunity.” Spencer Bogart made his remarks during an interview on CNBC’s Fast Money show Dec. 17.

Bitcoin is now trading around $3,550, up 2 percent and capping gains of around $260 in 24 hours before press time. The coin, however, is over 82 percent down from its price point this time last year.

Emphasizing that Blockchain Capital is a “long-term venture investor,” Bogart told CNBC:

“Could Bitcoin go to $50,000? Absolutely. It doesn’t have the same kind of price-to-earnings, enterprise value to revenue that normally puts a kind of upper bound or a ceiling on a typical early-stage technology company […] How long will it take? I’m not sure.”

After CNBC host Melissa Lee criticized the belief that the historic 2017 bull run “could only go higher,” Bogart said “there is absolutely nothing wrong with the [bull] thesis,” but noted that up until recently, the Bitcoin market has been “almost entirely driven by retail [investors].” This, he suggested, still results in bull market runs “going a little too high,” and conversely, bearish dips “too low.”

Bogart stressed that notwithstanding short-term price weakness, the “fundamentals” of the technology and concept are still there. In particular, the VC exec stated that 2018 has seen major advancements in scaling, with the Lightning Network helping to “transact extremely cheaply, and extremely quickly.”

He further pointed to increased institutionalization of the asset class, with this year’s endowments from United States Ivy League universities such as Yale and Harvard, forthcoming Bitcoin derivatives and the global digital assets trading platform from the Intercontinental Exchange’s (ICE) “Bakkt,” and the establishment of more qualified custodians for crypto assets.

Bogart’s last bullish remarks highlighted the outstanding “quality of talent” entering the crypto space, suggesting that the “best and brightest” are coming in to “work on Bitcoin.”

With one last consideration of price volatility, Bogart said that Bitcoin today could also “absolutely” go lower — “anywhere between here and $2,000 or even $1,000” — but that all of these price points represent “a great buying opportunity,” adding:

“When we look back 24 or even 12 months from now, we’re going to say, ‘why didn’t I buy then?’”

In recent comments, crypto bull and co-founder of Fundstrat Global Advisors Thomas Lee said he believes the “fair value of Bitcoin is significantly higher than the current price.” He proposed a figure between $13,800 and $14,800, considering the number of active wallet addresses, usage per account and other factors influencing supply.

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Institutional Investors No Longer Interested in Bitcoin: JP Morgan – NullTX

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Institutional investors are quickly losing interest in Bitcoin, JP Morgan has stated in recent research. According to the bank, key flow metrics have dwindled in recent months indicating reduced interest from the professional investors. The research cited interest in Cboe Global Markets which is at its lowest since Bitcoin futures launched a year ago. The median transaction volume has dropped by over 96 percent as well, further indicating dwindling interest.

Meanwhile, a new report by Diar has suggested that institutional traders may have shifted to over-the-counter platforms. The report alleged that these traders are turning to these markets as they have high liquidity. However, the working hours continue to be an Achilles heel for OTC platforms. Diar revealed that OTC platforms are open for trading only 31 percent of yearly tradable hours.

Is Bitcoin Losing Tractions with Institutional Investors?

Bitcoin was trading at $3,565 at press time, down over 80 percent from its record high. Interestingly, Bitcoin hit its record high exactly a year ago. The currency has had many retail traders in panic mode after almost testing the $3,000 level recently. And according to researchers at US’ largest bank, institutional investors are just as panicky.

In a research note seen by Bloomberg, the bank cited the prolonged slump in prices as the biggest concern for these investors.

Participation by financial institutions in Bitcoin trading appears to be fading. Key flow metrics have downshifted dramatically, including in futures markets and in average volumes.

In 2017, interest from well-funded global conglomerates in Bitcoin was applauded by the crypto community. This was viewed as the all-important step that would legitimize Bitcoin in the eyes of the masses. The deep pockets these investors brought with them was also quite welcome.

This interest is waning. As revealed by the bank, open interest on Cboe’s Bitcoin futures has hit its lowest level since the futures launched a year ago. It’s not any different on CME either, with the platform experiencing the bottom of its range this year.

The daily median transaction size has also taken quite a hit, signaling a decline in deep-pocketed investors. When Bitcoin was trading at record highs last year, the median transaction size stood at $5,000. It has dropped by 96 percent and currently stands below $160.

The research note also noted that Bitcoin hasn’t been the only casualty. However, the other cryptos have suffered disproportionately, with some feeling the heat more than others.

Deserting the Marketing or Changing Strategy?

While JP’s research indicates that investors are deserting the market, Diar’s research indicates a shift in strategy. The blockchain and crypto research firm concluded that these investors are turning to OTC platforms such as Coinbase’s which witnessed a 20 percent hike in trading volume this year. In contrast, Grayscale’s Bitcoin Investment Trust (GBTC) witnessed a 35 percent decrease this year.

Some crypto and trading experts have also stated their belief that institutional investors are accumulating as the retail investors dump their crypto assets. One of these is Jake Chervinsky, a securities litigations lawyer with New York-based global law firm Kobre & Kim LLP. He recently stated:

However, as revealed by Diar, the slowdown could be a combination of both diminishing interest and a rising popularity of OTC markets. With Bakkt set to launch in a month’s time, the market will get a better measure of institutional interest in Bitcoin.

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Google AI Briefly Describes Bitcoin as “Collapsed Economic Bubble” – Bitcoin News

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Reports have documented the recent description of Bitcoin as comprising a “collapsed economic bubble” on the part of Google’s artificial intelligence (AI). The bizarre depiction of the world’s first cryptocurrency came as a result of an edit made to Wikipedia classifying Bitcoin in said terms, with its author justifying such as representing “the majority view.”

Also Read: Cypherpunk Godfather Timothy May Was Lightyears Ahead of His Time

Google Displays Bearish Description for Bitcoin

Google AI Briefly Describes Bitcoin as 'Collapsed Economic Bubble'Screenshots have shown that the world’s largest search engine, Google, briefly described Bitcoin as a “collapsed economic bubble.”

The obscure categorization of Bitcoin by Google’s results page was due to the search engine displaying a snippet from the description given on Wikipedia, which at the time asserted that “Bitcoin is a cryptocurrency, a form of electronic cash,” adding that “The bitcoin market is widely viewed as a collapsed economic bubble as the price fell by 82% in the year ending December 2018.”

Said description of Bitcoin was penned by Wikipedia user “Smallbones’ on Dec. 12, who claimed that his edit greater reflected “the majority view” regarding the cryptocurrency. His edit, however, would not last, with fellow Wikipedia user ‘Bradv’ reversing Smallbones’ revision and requesting that the author stop inserting their personal point-of-view into the lede of the article.

Wikipedia Entry Reverted to Previous Version

Google AI Briefly Describes Bitcoin as 'Collapsed Economic Bubble'Furthermore, Bradv requested that Smallbones no longer be permitted to make edits to the Wiki page for Bitcoin, asserting that Smallbones’ edit was “inappropriate for any number of reasons, but especially because of Smallbones’ clear point of view.” Bradv also proposed Smallbones no longer be qualified to edit the article, stating that “their edits are clearly soapboxing.”

Both Wikipedia and Google’s search engine results page now state that “Bitcoin is a cryptocurrency, a form of electronic cash,” adding: “It is a decentralized digital currency without a central bank or single administrator that can be sent from user-to-user on the peer-to-peer bitcoin network without the need for intermediaries.”

Wikipedia placed a 24-hour restriction on edits being made to the page for Bitcoin, in addition to barring users from rolling back edits more than once per day on the page.

What is your response to the categorization briefly given to Bitcoin by Google? Share your thoughts in the comments section below!


Images courtesy of Shutterstock.


At Bitcoin.com there’s a bunch of free helpful services. For instance, have you seen our Tools page? You can even lookup the exchange rate for a transaction in the past. Or calculate the value of your current holdings. Or create a paper wallet. And much more.

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Now Is A Fantastic Time To Buy Bitcoin (BTC), Says Blockchain Capital’s Bogart – newsBTC

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The cryptocurrency tide is turning. On Monday, one year since Bitcoin (BTC) breached $20,000 in a jaw-dropping turn of events, the crypto market at large had its first double-digit rally in weeks. Within a few hours’ time, BTC found itself up by 9%, with altcoins outperforming the flagship cryptocurrency.And with this uptick alone, which comes after a multi-week downturn, the eyes of a multitude of interested investors have landed on this nascent industry. So it should come as no surprise that the question that remains on everyone’s mind is can crypto boom in 2019. Or, more importantly, what will drive cryptocurrencies forward in the near future.“Bitcoin Fundamentals Haven’t Changed”Blockchain Capital, widely referred to as one of the crypto industry’s multiple “800-pound gorillas,” recently saw its de-facto figurehead — partner Spencer Bogart — take to CNBC’s “Fast Money” segment to give an insight into crypto’s underlying status. Bogart, who has a vested interest in the success of this innovation, painted cryptocurrencies in a positive light.

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Don't let go of bitcoin just yet – Fin24

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By the end of 2017, bitcoin was reaching record highs, pushing towards $20 000 a bitcoin. The frenzy was palpable. Every auntie, uncle and their dog were buying bitcoin. Nobody wanted to miss out on the thing that was going to make them rich beyond imagination in a very short period of time!

Such is the nature of bubbles.

Early in 2018, of course, the bubble popped, and bitcoin now trades at around $4 000 a coin (at the time of writing on 5 December).

It was not entirely unexpected. In March, I wrote about how bitcoin is likely to form a repeating bubble pattern every four years, based on how it has performed in the past.

The reasoning was based on several different drivers; the “frenzy effect” that takes hold every time it rallies beyond what is normal (compared with traditional asset classes); the changing supply-demand dynamic as miners enter and exit the market due to difficulty in solving blocks, varying as these miners enter and exit the market; profitability of mining bitcoin due to the changing difficulty rate; and of course, the mining reward halving every four years.

The frenzy effect

The frenzy effect is a force driven primarily by individuals that are buying (or selling) a certain asset – in this case bitcoin – out of fear of some sort. In the case of bitcoin in 2017, this was a fear of missing out.

Everybody was talking about it and people were making real money, very, very fast. This got the attention of every media outlet around the world. For months bitcoin was the hottest topic out there.

The frenzy got to a point where people who have never traded a share, or even invested in financial instruments, were reportedly selling cars or taking loans to raise money to buy bitcoin. The belief was that it would never stop going up as it would change the world in a very short period of time. As it turns out, this was false.

Now we are seeing almost the exact opposite of what we saw last year. People refer to bitcoin as a useless technology with no real-world application. Some reckon its value will drop to zero. This too, I believe, is false.

Again, the frenzy of fear is at work. But this time it is the fear of losing money.

I believe that if bitcoin were to retake the $20 000 level and push 50% beyond it (to $30 000), the frenzy effect will kick in once more and drive hordes of speculators to buy again. Again, prices will be driven to stratospheric heights (much higher than in 2017, but a smaller percentage move).

As a disclaimer though, I do not foresee this happening until mid-2021. For now, we are coming out of the tail end of the “fear of losing money”-cycle, and prices will likely remain depressed for some time as people in general have no faith in bitcoin at the moment.

Understanding blockchain

It is important to the supply-demand dynamics of bitcoin. In its most simple form, bitcoin is a public ledger of transactions grouped together into blocks that are linked together in sequential order, hence the term “blockchain”.

These transactions are processed by miners (processing nodes on the bitcoin network) who compete against each other to group these transactions and have their unique group of transactions accepted as the next official block in the chain.

In order for a miner to have its block accepted as the next official block in the chain, it must solve a complex mathematical problem before any of the other miners on the network do. So, in a sense, it’s a race between these miners to solve the block before anyone else can.

Once the block is solved, it is communicated to all miners on the network and is accepted as the next immutable block of transactions in the public ledger. The race is then on to solve the next block. This process happens every ten minutes. The miner who solves the block is rewarded for the work done (to process transactions) by receiving bitcoin.

As the price of bitcoin rises, more people buy specialised computers to process these transactions, hoping to earn bitcoin. But as more computers are added, the bitcoin network automatically increases the difficulty of the mathematical problems to be solved in order to have a block accepted as the next official block in the immutable public record of transactions.

Also: The more computers join, the more computing power is required to solve problems quickly. With rising prices for bitcoin, though, more miners continue to enter as the reward outweighs input (computer hardware, cooling systems and electricity costs).

Every four years the reward is halved by the network, which means less efficient miners (i.e. those who have less sophisticated computer hardware) become less profitable or unprofitable altogether, as the input costs now outweigh the profit they make by earning bitcoin and selling it for normal currency.

This allows miners to demand higher prices for bitcoins as there is now in effect lower supply due to the reward being halved. This drives prices higher and starts the frenzy driven by the fear of missing out.

But, because so many computers have joined during a period of rising bitcoin prices, the mathematical problems are now much harder and the chances of them solving a problem first, and thus earning the reward, is significantly lower. Nonetheless, inefficient miners stay on the network because of the rapidly increasing price of bitcoin.

Higher prices continue to attract more miners and inefficient (older) miners are forced to shut down their mining computers and sell their bitcoins to recover costs. This mass and rapid shutdown brings a large number of bitcoins to the market, and suddenly the market finds itself in a state of oversupply.

Prices come down, frenzy driven by fear of losing money sets in. The bubble pops.

Bitcoin prices fall between 80% and 90%, driving out many more miners, at which point the network once again automatically adjusts the difficulty lower as there is now less competition. Miners operating the newest state-of-the-art hardware are once again profitable at lower prices. We then see a gradual fluctuation in prices over time, bitcoin disappears from the radar and bitcoin prices happily churn sideways in a relatively stable pattern for about two years as miners enter and exit the network at different price points.

Eventually the reward for “finding a block” is again halved and the process starts all over again.

This has happened three times already since bitcoin came about in 2009. Well, we are in the third cycle right now. The price has come down around 80% from the highs and miners have packed up operations. Already the difficulty of the mathematical problems to be solved to find a block have started to decrease and people in general are talking about bitcoin less and less.What next?

So, what now? Well, the same as what I had said in March. I expect that bitcoin should stabilise in a range over the next two years with the near $4 000-level being the bottom of the range and near $8 000 the top (which will mean, in percentage terms, its performance is in line with what it was four years ago).

Eventually nobody (in mainstream media) will be talking about it anymore and the people using it will be doing so to facilitate cross-border and online transactions (as is its purpose).

The mining reward will be halved and if the pattern holds true, in 2021 it will take out the highs of $20 000 made last year. Then the talk will begin again, and a new frenzy driven by fear of missing out will start.

I am of the belief that this pattern will repeat itself every four years until bitcoin is around 250 times its current level, at $1m, by approximately 2040.

Petri Redelinghuys is a trader and the founder of Herenya Capital Advisors.

This article originally appeared in the 20 December edition of finweek. Buy and download the magazine here or subscribe to our newsletter here.

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Crypto millionaire Erik Finman warns Bitcoin is ‘dead’ as cryptocurrency crash continues – The Sun

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A TEENAGE bitcoin millionaire has warned that the cryptocurrency is now “dead” and that its future is finite.

Erik Finman, 19, from New York, has been investing in the digital currency since he was 12-years-old and now he’s warning others that bitcoin’s end is on the horizon.

The millionaire told investing publication MarketWatch: “Bitcoin is dead, it’s too fragmented, there’s tons of infighting I just don’t think it will last.

“It may have a bull market or two left in it, but long-term, it’s dead.”

A year on from the currency’s record-breaking high, Bitcoin looks like it’s now set to smash another record – a new 2018 low.

Since the start of the year, the cryptocurrency has continued to crash, which is now down to $3,400 (£2,688) today.

Erik bought bitcoin in 2011 with a gift from his grandmother, and eventually turned $1,000 (£790) into more than $4million (£3,162,800) by the time he turned 18.

His first bitcoin cost him $12 (£9.50) and by the time he cashed them in at the cryptocurrency’s peak in 2017, they were worth around $20,000 each.

He used the profits to launch his own online tutoring business, Botangle, which links students with teachers via video chat.

Now, Erik’s Instagram account is littered with photos of the entrepreneur flying solo on private jets, sitting on top of swanky cars, lying in bed on dollar bills and pretending to smoke a rolled up $100 note.

He also warned that another popular cryptocurrency Litecoin is also on it’s way out, which is down by more than 95 per cent from its peak in May last year.

What is Bitcoin?

BITCOIN got you baffled? Here’s what you need to know:

  • Bitcoin is a virtual currency
  • It’s traded between people without the help of a bank
  • Every transaction is recorded in a public ledger, or ‘blockchain’
  • Bitcoin is created by mining
  • Mining involves solving difficult maths problems using computer processors
  • Bitcoin can be traded anonymously, which makes it a popular way of funding illegal activities
  • A single Bitcoin is worth just under £5,000 today, but the value fluctuates wildly
  • Bitcoin is one of many different cryptocurrencies, but by far the most popular

But the teenager did praise digital currencies like Ether and ZCash – so all is not lost if you’re thinking of dipping your toe into the world of online currencies.

Bitcoin is a virtual currency that was created in 2009 by an unknown computer whizz using the alias Satoshi Nakamoto.

The future of bitcoin is largely unknown because it’s largely unregulated – although this could change because governments are concerned about taxation.

In October, bitcoin prices rocketed on Bitfinex Exchange as Tether – another cryptocurrency – dropped against the dollar.

But it’s rise was short lived. In November, prices fell below $4,500 for the first time in a year, and it’s continued to crash even further.

But some sellers are willing to accept it. Daniel Roy even put his £1.65million townhouse in Peckham, South London, on the market for 500 bitcoin in September 2017.

The following month a newbuild family home in Colchester, Essex, was marketed for 82.55 bitcoin, equivalent to around £25,000 less than if paying in sterling.

One fitness fan managed to turned her £2,700 bitcoin investment into £80,000 over four years – and used the profits to quit her job and start her own health business.

Brief history of Bitcoin and its market volatility


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Jordan Peterson Flooded with Bitcoin Posts in Wake of Patreon Debacle – Hacked

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We received an anonymous tip regarding accusations of untoward conduct on behalf of Path Network, a blockchain token economy fueled platform which claims to be “redefining internet visibility through distributed monitoring”.

This activity was reported via Twitter by Josh Leroux (@JoshTheGod) of Luxr LLC and includes video evidence. This footage (contained in the Tweet, presented beow) purportedly depicts Path Network media advisor Eric Taylor (@CosmoTheGod) threatening Milad Sarwari (aka ‘notspoof) on behalf of CTO and co-founder Marshal Webb.

These threats are, apparently, in response to Sarwari broadcasting reports of Webb using investor funds to sustain a “lavish lifestyle” – which to this writer sounds akin to accusations of embezzlement.

The message was later retweeted by Troy Woody who added additional comments of his own…

Is Path On Track?

Path Network is a project which ran its ICO public crowd sale event earlier this year that aims to “use commodity electronics already located around the world to monitor the health of the internet”.

Funding closed on the 24th of August 2018, relatively recently: with the network having launched (according to the whitepaper) just one month prior, but despite this you would be forgiven for not having heard of it. A Cursory web-search yields only results from articles and official marketing communications pertaining to its ICO period.

Roadmap and Blog Check Out, If Little Else

The only publicly available white-paper at present (version 0.9.3.2) is a little outdated and appears to have been released between the beginning of this year and the launch of the team’s ICO.

As such, the technical roadmap can be used as a reference against which we can measure the project’s current progress. For August 2018 it lists milestones like ‘production launch’ in addition to the release of the iOS mobile application and Chrome Sockets support. This is what is referred to as ‘Phase 2’.

Phase three is planned to come to fruition in January 2019 onward and includes the release of a free public internet monitoring map, in addition to the Android counterpart to the iOS application, the expansion of the website’s analytical features, as well as the roll out of ‘raw-socket features’ (“proxies, post support, etc”).

Looking at the official website at present, we can see that the app has been released on Android but not iOS, contrary to the plan but supporting any argument that progress is being made.

The official blog suggests that all operations are progressing fine with regular content postings, whilst the Twitter account hasn’t received any updates since November 2018. The pinned post for Path Network contains two further allegations among its replies…

Threats of Extortion?

It could potentially be related to an article posted to the Path blog in October 2018 entitled ‘Someone Tried to Extort Path’. The post was written by company CEO E.J. Hilbert and describes an instance in which he asserts that he was extorted via Telegram by an unknown individual for the amount of $1.6million.

Hilbert stated that the malicious actor

“claim[ed] he has compromising data about Path and our negotiations and threaten[ed] to go public with the information.”

Before concluding that

“The attacker later admits that he is in the UK, that he is promoting ICO’s, and that he has done no research on Path Network. In the end he claims he just wants the list of people who per-bought Path utility tokens (those used for credits on the Path and Path Connect service lines) so he can pitch those “investors” on his ICO’s. He even agrees to send me an email, so we can discuss who he should contact.”

And even suggesting a veiled threat of his own…

“He also admits that he is trying to extort me, an ex-FBI agent. (I know I have been out for 10 years but come on, is that really a smart move?)”

Evidence Behind The Claims

We have since attempted to get in touch with all of the people named to be involved from the above Tweets, and have yet to receive a response.

Because of this, the source of the dispute that appears to be going on right now is unclear and we cannot confirm whether we are witnessing a scam in progress, or a bitter defamation attempt.

Keep an eye on this article and our front-page for updates on the situation. If you have witnessed any issues or experience with Path please let us know in the comments section or shoot us a message.

Featured image courtesy of Shutterstock.

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BitMEX CEO Says Bitcoin and Crypto Are 'Still an Experiment' – The Daily Hodl

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Laura Shin, host of Unchained, interviewed Arthur Hayes, co-founder and CEO of BitMEX; Dan O’Prey, chief marketing officer of Digital Asset; and Alexis Ohanian, co-founder and executive chairman of Reddit and co-founder of Initialized Capital, in a special episode of her podcast from the CME Global Leadership Conference in Naples, Florida.

The panel of speakers convened to focus on the outcome of the long “crypto winter,” which has watched Bitcoin lose over 80% of its value along with similar declines for many other cryptocurrencies. On the other side of the rainbow lies more infrastructure for cryptocurrencies, allowing value transfers from peer-to-peer and enterprise-to-enterprise.

In addition to CryptoKitties, non-fungible assets and the rise of security tokens, the group hones in on today: the early days of digital assets, and how banks and the financial services industry are trying to stake their flags  through public blockchains, private blockchains or both. As for everyday consumers, blockchain developers as well as institutions are trying to figure out what people really want.

Here are highlights from the podcast.

Arthur Hayes says the cryptosphere is small and experimental.

“Apple has more cash on its balance sheet than the whole value of the industry that we’re talking about. So, it’s insignificant in terms of where it is today. Could it become a bona fide asset class in the next 10 years? Maybe. The jury is out on whether or not Bitcoin is actually secure over the long run. It’s had a decade, which is pretty good, but it’s still an experiment. So, the jury is out, but it’s looking like it could be a new way of raising capital and sending value around the world.”

Ohanian first got exposed to crypto on Reddit. He says that Bitcoin, despite its relative youth, has already proven itself as a store of value.

“I do think, as a store of value, Bitcoin has been – and this is particularly for people outside of this country – a tremendous resource. And we’re already seeing, even anecdotally, money getting moved out of countries on thumb drives where gold is literally being confiscated from people as they make their way out. As an example, a friend of mine tweeted a few weeks ago, out of Venezuela, they were able to get that currency, the currency they had stored digitally in Bitcoin, out, and safe.”

“As an asset class, I aim for about 10% of my net worth in crypto. And my bet, simply being that, if this future that we hope for technologically pans out, this will be a really material investment – but it’s still tremendously risky.”

Dan O’Prey, who co-founded Hyperledger, the world’s first distributed ledger platform for financial institutions, sees a match between public and private blockchains.

“As to how we see these two converging – between the permissioned [blockchain] world and the crypto world – I think that could be potentially a very interesting match where you’re actually using the public chains essentially as a settlement layer of the ultimate underlying asset. But all of the financial workflows and the lifecycle management around that could be done on a permission distributed ledger amongst traditional financial institutions.”

To reach mainstream adoption, Hayes says we need to follow the money.

“Institutions need to look at Bitcoin or Bitcoin trading… It’s really about, ‘How much money can you make?’ What’s the volatility? What are the volumes? We’ve come off about 70% in terms of the price this year. Volatility’s down massively. Exchanges are firing people. It’s a very volume-driven business, and if there’s no volume, and there’s no excitement, then the institutions won’t get involved. But at the end of the day, it’s ‘Can you make money trading it?’ And if the answer is ‘yes,’ they’ll find a way to do it.”

Says O’Prey,

“The real projects, such as the ASX (Australian Securities Exchange) – they’re literally replacing their entire post-trade system for equities with a distributed ledger, with a digital asset platform, and that is going into production in Q1 ’20/’21. It takes time, but as the hype dissipates, people will focus more on what’s real, what business problems can we actually solve, because ultimately that’s where the biggest returns are going to actually be.”

According to Ohanian,

“I feel really privileged because we have a front-row seat to all these emerging technologies…The best part of this crypto winter is that it scared away a lot of the charlatans and scensters. The people who are building on crypto right now, who are credible builders, who come from companies – they don’t have to – but they’ve come from companies where they’ve shipped real product, who are smart, who are driven. The ones who are building right now and who are building in this space are very encouraging.”

“Users will gravitate towards the better user experience. The thing that is better, the thing that is cheaper, the thing that is faster, and I think to a certain extent, participating with the existing system allows for a better user experience in nearly all the typical use cases. And so, if you’re trying to go the fully independent, techno-anarchist dream playbook, you’re really just trying to fulfill a need for a pretty small sector of the market, which can be done, and God bless you, good luck, but I think what we’re going to see in the next 10 years is going to look a lot more like traditional finance  – just done better, cheaper, faster  – than the utopian crypto future.”

Adds O’Prey,

“What end users really want largely is convenience, and they’re quite happy, in many cases, to trust entities such as yourselves for these services. They don’t want to trust blindly or completely, but they’re happy to. Like Coinbase. Most Bitcoin users buy on Coinbase and leave their coins on Coinbase. It’s a centralized entity and some of them never leave that system.

With decentralization, a lot of people often get caught up thinking that’s the goal. With Bitcoin, decentralization wasn’t the goal. Censorship-resistant cash was the goal, and decentralization was a requirement in order to achieve that goal.

And there are many benefits to centralization: economies of scale. There are some decentralized blockchain systems which are trying to decentralize Amazon Web Services, but having massive data centers, co-located with tons of storage – it’s very hard to compete with because the price pressure is on that. Likewise in financial services. When you’ve got central counterparties and CSDs [central securities depository] playing central roles in entire markets, there may be downsides to actually attempting to decentralize this.”

Hayes says consumers don’t really care what happens behind the scenes.

“If it looks really nice and it’s decentralized, they’ll use it. If it looks really nice and it’s centralized, they’ll use that too.”

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Disclaimer: Opinions expressed at The Daily Hodl are not investment advice. Investors should do their due diligence before making any high-risk investments in Bitcoin, cryptocurrency or digital assets. Please be advised that your transfers and trades are at your own risk, and any loses you may incur are your responsibility. The Daily Hodl does not recommend the buying or selling of any cryptocurrencies or digital assets, nor is The Daily Hodl an investment advisor. Please note that The Daily Hodl participates in affiliate marketing.

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Bitcoin [BTC] is not very efficient in doing large transactions, says Nobel Laureate – AMBCrypto News

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Bitcoin [BTC] and the cryptocurrency market has caught the eye of many prominent members of the economic community with most of them voicing their opinions on it. In a recent interview, Paul Romer, a Nobel Laureate, spoke about the versatility of Bitcoin and the field of cryptocurrencies as a whole.

Speaking to Bloomberg, the NYU professor spoke about how organizations need to beef up cryptography, the technology behind the concept of blockchains and in turn cryptocurrencies. Romer stated that Bitcoin’s initial catalyst came from the fact that no trusted party was required to verify transactions.

He added that the lack of confidence that established central banks prided during the initial surge of cryptocurrencies but said that right now, those very banks have become very adept at keeping inflation in check. In his words:

“There is no need for people to fear or doubt the abilities of central banks. The past few years have taught us that government can do right by people by taking care of the information spiral an ensuring that the economy is stable.”

Romer was of the opinion that the technologies present right now are not at their fullest implementation and that there is a long way to go before they become mainstream. He even quoted the example of how blockchain technology can be used to monitor food security ie. tracking the resource from start to finish. The discussion also focused on cryptocurrencies can disturb the hegemony held by the United States dollar. To this, Romer said:

“The dollar cannot be perturbed because people still need it to conduct large transactions. The main problem with Bitcoin is that it is not very efficient to do large transactions. The world is still not ready for a single undiversified currency.”

The Nobel Laureate also opined that the US dollar will be threatened to a proper scale only in a 100 years and even then it may be because of the Euro or China. A lot of Nobel laureates have given their word on the world’s largest cryptocurrency with the last person being Paul Krugman. He had said that Bitcoin is a “self-defeating form of progress. According to him:

“but the validation, someone has to be investing the resources in effect to say that this token I’ve received is a real one […] I mostly know that the dollar bill in my wallet is the real one because it’s a bit hard to reproduce.”


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Engineering graduate,crypto head and Arsenal fan. Is fascinated by technology and all its marvels. Strictly against pineapple on pizza.

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Settling A Bitcoin 'Bet' – Forbes

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Source: AdobeStock.com

How did my 5 ETFs do versus the famous cryptocurrency during 2018?

It is the holiday season.  That means three things to me:

  1. Good cheer
  2. Family and friends
  3. Settling a friendly non-financial wager with some friends about Bitcoin

During this week in 2017, I relayed in this column a discussion I had with my monthly dinner group, which was prompted by an enthusiastic discussion about the merits and flaws of investing in Bitcoin.  At the time, it was headline news.  As the chart from that article shows here, Bitcoin’s price had risen like rocket, from under $5,000 in October to nearly $16,000 as year-end approached.

Source: Bloomberg.com

How big was the Bitcoin frenzy at the time?  That article, I’d Rather Own These Than Bitcoin, was the most-read blog post I have ever had on Forbes.com, despite being published shortly before Christmas, the “slow season” for financial journalism.  As I said back then:

“…For the benefit of the few of us who hear “Bitcoin” and think dot-com bubble, Tickle Me Elmo, Nifty Fifty or Tulip Bulbs (look it up!), I present a list of 5 ETFs that I would rather own in 2018 than Bitcoin or any of its cousins.  I chose these from the list of 100 I track daily.”  

Source: YCharts.com

Here’s how things turned out.  While I am certainly not doing an “endzone dance” over the results of the 5 ETFs I chose a year ago, I will offer one investment tenet that is on display here.  Investing in what is popular can work for a while, but it often leads to big losses.  “Big” is defined differently for everyone, and I imagine that retired folks were not plugging 50% of their IRA accounts with cryptocurrencies.  But there is a difference between volatility that produces mediocre results over a limited, fixed time period like year-to-date, and catastrophic losses that burn the greedy and fearless.

And, just so you don’t think this is an isolated example involving Bitcoin, take a look at this chart:

Source: YCharts.com

Look closely.  That’s the Nasdaq Composite Index from the start of the Dot-Com Bubble burst until it ended.  It covers the period from March of 2000 through March of 2003.  The lesson here: even prominent segments of the investment markets can lose tremendous portions of their value after they run amok to the upside.  This is the case for stocks, indexes, and even some forms of bonds.

My holiday wish for you is that you approach each investment decision and your broader investment strategy with a critical eye, and a balanced approach.

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