A new report from Reuters, citing CoinShares, indicates that China's Bitcoin miners now control a whopping 66% of the world's crypto network's processing power. This could be bad news for US miners as it signals China is quickly advancing.
Also known as "hashrate," it's the speed at which a computer is performing an operation in Bitcoin code to unlock coins, China has been steadily gaining hashrate share this year.
In June, China's Bitcoin miners controlled 60% of the global hashrate, and now the figure is up to 66% in December.
Chris Bendkisen, head of research at CoinShares, believes the rapid increase in the Chinese share of hashrate could be due to the deployment of advanced mining technology.
"This is beneficial to the Chinese mining industry," said Bendiksen. "If you are the first to increase your proportion of the hashrate, and you can do that before your competitors, that's generally good."
Mining crypto has become more difficult over the last several years as profitability sags. The overall Bitcoin hashrate has risen 80% since June, which in recent times, has created stronger profitability for miners who have access to cheap energy.
With China controlling more and more of the world's Bitcoin hashrate, some worry that the US could be falling behind the crypto curve, as Beijing is making a state effort to be a leader in blockchain.
Xiao Wunan, an executive vice-chairman of the China-backed Asia Pacific Exchange and Co-operation Foundation (APECF), recently told CNBC that Beijing's crypto initiatives are strategically important to the communist party.
Read the entire article
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Showing posts with label Bitcoin. Show all posts
Showing posts with label Bitcoin. Show all posts
December 12, 2019
December 9, 2019
The Next Pearl Harbour? China's Gold-Backed Crypto Currency Will Blindside US Dollar
Indeed, this weekend marks the 78th anniversary of the attack on Pearl Harbor in Hawaii, which opened the door for the United States to enter World War II. Turn on your TV and you will see military mavens rambling on, pontificating about ‘the defense of the realm’, all the while completely aloof and unaware of the American empire’s real Achilles heel.
Recent, financial pundit and TV host Max Keiser outlined such a scenario, and warned that the US will be blind-sided the day that China introduces its gold-backed crypto currency – an absolute game changer which would create a “catastrophic trapdoor opening underneath the US economy,” said Keiser.
Not surprisingly, very few mainstream financial pundits in the West are willing to admit that China possesses gold reserves in excess of 20,000 tons, and by introducing a gold-backed cryptocurrency, it has the ability to “kill the US dollar deader than a door nail …. a new Pearl Harbor-type event and it’s coming in the next six to nine months.”
Read the entire article
Recent, financial pundit and TV host Max Keiser outlined such a scenario, and warned that the US will be blind-sided the day that China introduces its gold-backed crypto currency – an absolute game changer which would create a “catastrophic trapdoor opening underneath the US economy,” said Keiser.
Not surprisingly, very few mainstream financial pundits in the West are willing to admit that China possesses gold reserves in excess of 20,000 tons, and by introducing a gold-backed cryptocurrency, it has the ability to “kill the US dollar deader than a door nail …. a new Pearl Harbor-type event and it’s coming in the next six to nine months.”
Read the entire article
November 6, 2019
Is The Global Dollar In Jeopardy?
Since the end of World War II, the United States dollar has been at the heart of international finance and trade. Over the decades, and despite the many ups and downs of the global economy, the dollar retained its role as the world’s favorite reserve asset. When times are tough or uncertainty reigns, investors flock to dollar-denominated assets, particularly US Treasury debt – ironically, even when there is a financial crisis in the US. As a result, the Federal Reserve – which sets US dollar interest rates – has enormous sway over economic conditions around the world.
For all the associated innovation evident since the launch of the decentralized blockchain-based currency Bitcoin in 2009, the arrival of modern cryptocurrencies has had essentially zero impact on the global taste for dollars. Promoters of these new forms of money still have their hopes, of course, that they can challenge the existing financial system, but the impact on global portfolios has proved minimal. The most powerful central banks (the Fed, the European Central Bank, and a few others) are still running the global money show.
Suddenly, however, there is a new, potentially serious player in town: Facebook’s Libra initiative. Facebook and a currently shifting coalition of firms are planning to launch their own private form of money that would, in some sense, be secured by holdings of major currencies.
Without question, Libra could become a widely used form of payment – partly because Facebook has over two billion monthly active users, but also because the existing financial system is full of inefficiencies. If private money could make it cheaper, easier, and safer to make payments, then consumers would be happy to use it. Few people care what is under the hood of the monetary engine; most just want crash-proof transactions.
The unfortunate truth is that our current payment system is expensive to run, including for sending money overseas in the form of remittances sent by workers back to their home countries. If Libra could allow people to send money as easily (and as cheaply!) as they post updates to Facebook, the currency would get a lot of likes.
We have repeatedly experienced how quickly a disruptive new digital technology can transform the economic landscape. Think of how fast taxis came under pressure from Uber and Lyft.
Read the entire article
For all the associated innovation evident since the launch of the decentralized blockchain-based currency Bitcoin in 2009, the arrival of modern cryptocurrencies has had essentially zero impact on the global taste for dollars. Promoters of these new forms of money still have their hopes, of course, that they can challenge the existing financial system, but the impact on global portfolios has proved minimal. The most powerful central banks (the Fed, the European Central Bank, and a few others) are still running the global money show.
Suddenly, however, there is a new, potentially serious player in town: Facebook’s Libra initiative. Facebook and a currently shifting coalition of firms are planning to launch their own private form of money that would, in some sense, be secured by holdings of major currencies.
Without question, Libra could become a widely used form of payment – partly because Facebook has over two billion monthly active users, but also because the existing financial system is full of inefficiencies. If private money could make it cheaper, easier, and safer to make payments, then consumers would be happy to use it. Few people care what is under the hood of the monetary engine; most just want crash-proof transactions.
The unfortunate truth is that our current payment system is expensive to run, including for sending money overseas in the form of remittances sent by workers back to their home countries. If Libra could allow people to send money as easily (and as cheaply!) as they post updates to Facebook, the currency would get a lot of likes.
We have repeatedly experienced how quickly a disruptive new digital technology can transform the economic landscape. Think of how fast taxis came under pressure from Uber and Lyft.
Read the entire article
July 30, 2019
Is Bitcoin A Store Of Value? Experts Weigh In On 'Digital Gold'
It’s hard to tell who was the first to coin - pun intended - Bitcoin as “digital gold,” underlining the idea that Bitcoin is a good store of value. To understand the community leaders’ thoughts about digital gold nowadays, we asked Binance’s Changpeng Zhao, award-winning technology leader Jonathan Reichental, the United Nations’ Susan Oh, Singularity University’s David Obran and other outstanding experts.
The phrase “digital gold” possibly came into more widespread use after The New York Times journalist Nathaniel Popper's book, "Digital Gold," was published in 2015. Google searches for the term “Bitcoin digital gold” peaked in December 2017, when the leading cryptocurrency’s price hit record highs around $20,000 per coin.
Well before Bitcoin was born, computer scientist Nick Szabo wrote a proposal for “bit gold,” laying out a concept for secure digital money that is often referred to as Bitcoin’s predecessor.
After 10 years of existence, the question of whether or not Bitcoin can in fact be considered “digital gold” continues to be debated in the industry. Yes, Bitcoin is designed to be scarce, but when discussing it as a potential store of value, many point to Bitcoin’s historical volatility as an argument against doing so.
Read the entire article
The phrase “digital gold” possibly came into more widespread use after The New York Times journalist Nathaniel Popper's book, "Digital Gold," was published in 2015. Google searches for the term “Bitcoin digital gold” peaked in December 2017, when the leading cryptocurrency’s price hit record highs around $20,000 per coin.
Well before Bitcoin was born, computer scientist Nick Szabo wrote a proposal for “bit gold,” laying out a concept for secure digital money that is often referred to as Bitcoin’s predecessor.
After 10 years of existence, the question of whether or not Bitcoin can in fact be considered “digital gold” continues to be debated in the industry. Yes, Bitcoin is designed to be scarce, but when discussing it as a potential store of value, many point to Bitcoin’s historical volatility as an argument against doing so.
Read the entire article
July 2, 2019
From "Ponzi" To "We're Working On It" - BIS Chief Reverses Stance On Crypto
The head of the Bank of International Settlements (BIS) has appeared to U-turn on issuing digital currencies after a fresh interview with the Financial Times on June 30.
Speaking to the publication, BIS chief Augustin Carstens actively endorsed the creation and issuance of digital versions of national fiat currencies.
“Many central banks are working on it; we are working on it, supporting them,” he said.
“And it might be that it is sooner than we think that there is a market and we need to be able to provide central bank digital currencies.”
The comments struck a curious note with many, coming just months after Carstens emphatically advised against issuing such digital currencies.
Read the entire article
Speaking to the publication, BIS chief Augustin Carstens actively endorsed the creation and issuance of digital versions of national fiat currencies.
“Many central banks are working on it; we are working on it, supporting them,” he said.
“And it might be that it is sooner than we think that there is a market and we need to be able to provide central bank digital currencies.”
The comments struck a curious note with many, coming just months after Carstens emphatically advised against issuing such digital currencies.
Read the entire article
June 25, 2019
Ethereum Co-Founder Slams Facebook's Libra Token For Centralization
Ethereum co-founder Joseph Lubin said that Facebook’s Libra token is like “a centralized wolf in a decentralized sheep’s clothing” in an article published on tech news outlet Quartz on June 21.
The social media giant released the white paper for a its cryptocurrency dubbed Libra earlier this month to mixed reviews from experts in the cryptocurrency and blockchain industries and concern from government regulators.
In his article, Lubin notes that Libra’s white paper describes feelings common among many in the cryptocurrency community. It states that “sending money across the globe should be as simple and inexpensive as sending a message on your phone,” and “financial infrastructure should be globally inclusive and governed as a public good.”
While noting the white paper’s claim that “People will increasingly trust decentralized forms of governance,” Lubin pointed out the need for users to trust Libra’s fiat currency and government bond backing, and merchants to trust that the network be responsibly run. Furthermore, Lubin also noted its centralized infrastructure:
Read the entire article
The social media giant released the white paper for a its cryptocurrency dubbed Libra earlier this month to mixed reviews from experts in the cryptocurrency and blockchain industries and concern from government regulators.
In his article, Lubin notes that Libra’s white paper describes feelings common among many in the cryptocurrency community. It states that “sending money across the globe should be as simple and inexpensive as sending a message on your phone,” and “financial infrastructure should be globally inclusive and governed as a public good.”
While noting the white paper’s claim that “People will increasingly trust decentralized forms of governance,” Lubin pointed out the need for users to trust Libra’s fiat currency and government bond backing, and merchants to trust that the network be responsibly run. Furthermore, Lubin also noted its centralized infrastructure:
Read the entire article
May 14, 2019
Gold, Bitcoin, & The Gigantic Global Debt Bubble
Today’s the first day in a long time financial markets appear willing to at least consider the reality of the geopolitical situation on the ground for what it is, as opposed to what most people would like it to be. As I’ve noted for months, the “trade war” is just one battle in a much larger, increasingly unstable struggle between the U.S. and China for global power and leverage to shape the next paradigm of world history.
A failure to appreciate how big this really is explains why investors have been so willing to swallow unrealistic happy talk from both sides. The risk that needs to be discounted in the market isn’t a risk of higher tariffs, but the risk of WW3. The U.S. and China were never going to sign a trade deal and blissfully return to the ways things were. That world is over. We now find ourselves in the very early days of a historic struggle to influence the future.
The Global Debt Bubble
At the core of everything unsustainable and destabilizing about the “old world” we live in, lies the ever expanding global debt bubble. In early 2018, I wrote an opinion piece for The Hill titled, Bitcoin Isn’t the Bubble — the Global Financial System Is, in which I noted:
While we’re on the topic of bubbles, it seems the truly gigantic bubble in the world isn’t bitcoin, but rather the global debt market. This leviathan now stands at around $233 trillion, or 318 percent of global GDP. Even more troubling, an estimated $11 trillion of government debt now trades at negative yields. This means whoever is buying this paper is doing so despite the fact they are guaranteed to lose money on the “investment.” Much of this buying has been propelled by central banks which can print their own currency and buy debt indiscriminately. This is not characteristic of a healthy financial system (particularly so many years into a global recovery), but rather a zombie one that’s been artificially propped up since the financial crisis.
Read the entire article
A failure to appreciate how big this really is explains why investors have been so willing to swallow unrealistic happy talk from both sides. The risk that needs to be discounted in the market isn’t a risk of higher tariffs, but the risk of WW3. The U.S. and China were never going to sign a trade deal and blissfully return to the ways things were. That world is over. We now find ourselves in the very early days of a historic struggle to influence the future.
The Global Debt Bubble
At the core of everything unsustainable and destabilizing about the “old world” we live in, lies the ever expanding global debt bubble. In early 2018, I wrote an opinion piece for The Hill titled, Bitcoin Isn’t the Bubble — the Global Financial System Is, in which I noted:
While we’re on the topic of bubbles, it seems the truly gigantic bubble in the world isn’t bitcoin, but rather the global debt market. This leviathan now stands at around $233 trillion, or 318 percent of global GDP. Even more troubling, an estimated $11 trillion of government debt now trades at negative yields. This means whoever is buying this paper is doing so despite the fact they are guaranteed to lose money on the “investment.” Much of this buying has been propelled by central banks which can print their own currency and buy debt indiscriminately. This is not characteristic of a healthy financial system (particularly so many years into a global recovery), but rather a zombie one that’s been artificially propped up since the financial crisis.
Read the entire article
September 6, 2018
Bitcoin Plunges For Second Time In One Day As Cryptocurrency Turmoil Deepens
The selloff across cryptocurrencies accelerated late on Wednesday, when bitcoin and other digital tokens dropped for the second time in less than 24, sinking to a nine-month low amid growing concern broader adoption of digital assets will take longer than some anticipated following an earlier report that Goldman was suspending its cryptocurrency trading desk plans.
Bitcoin tumbled as much as 10% percent and was trading at $6,408 on Thursday morning, down 7.8%. The Bloomberg Galaxy Crypto Index, a gauge of the largest digital assets, traded near its lowest level since November 2017 as rival coins Ripple, Ether and Litecoin also tumbled in sympathy.
The Goldman decision to pull back from trading crypto followed more bad news last month, when the SEC rejected another round of Bitcoin ETF proposals.
“Their name carries weight across the globe,” said Ryan Rabaglia, head trader at digital asset brokerage OSL in Hong Kong, referring to Goldman Sachs. "When people see their name, their eyes may light up, and they say: OK, we’ve finally made it -- the bigger players are going to start to enter."
Separately, Bloomberg reported on Wednesday that enthusiasts drawn to Bitcoin’s original promise of anonymity and freedom from government control were also dealt a blow when veteran Erik Voorhees’s trading platform ShapeShift AG said it will begin asking users for personal information.
Read the entire article
Bitcoin tumbled as much as 10% percent and was trading at $6,408 on Thursday morning, down 7.8%. The Bloomberg Galaxy Crypto Index, a gauge of the largest digital assets, traded near its lowest level since November 2017 as rival coins Ripple, Ether and Litecoin also tumbled in sympathy.
The Goldman decision to pull back from trading crypto followed more bad news last month, when the SEC rejected another round of Bitcoin ETF proposals.
“Their name carries weight across the globe,” said Ryan Rabaglia, head trader at digital asset brokerage OSL in Hong Kong, referring to Goldman Sachs. "When people see their name, their eyes may light up, and they say: OK, we’ve finally made it -- the bigger players are going to start to enter."
Separately, Bloomberg reported on Wednesday that enthusiasts drawn to Bitcoin’s original promise of anonymity and freedom from government control were also dealt a blow when veteran Erik Voorhees’s trading platform ShapeShift AG said it will begin asking users for personal information.
Read the entire article
June 12, 2018
War On Cryptocurrencies: Wells Fargo, J.P. Morgan Chase, Bank of America, Citigroup And Capital One Have Banned Their Customers From Buying Bitcoin With Credit Cards
A war on cryptocurrencies such as Bitcoin, Ethereum, Ripple and Litecoin has begun, and it threatens to destroy the entire cryptocurrency industry. If you think that I am exaggerating, just keep reading. Government agencies are cracking down hard, Bitcoin traders that don’t file the proper paperwork are being sent to prison, Facebook and other online ad platforms have banned all cryptocurrency advertising, and now major credit card companies are banning their customers from using their credit cards to buy cryptos. What is an industry supposed to do if it can’t advertise and it can’t take credit cards? Such moves would kill virtually any consumer-oriented industry, and right now the cryptocurrency industry is absolutely reeling. If this war on cryptocurrencies continues to intensify, I honestly don’t know how the industry is going to survive.
On Monday, another shot was fired in the war. Wells Fargo formally announced that their customers would no longer be permitted to purchase Bitcoin and other cryptocurrencies with Wells Fargo credit cards…
Wells Fargo customers can no longer buy cryptocurrencies such as bitcoin on their credit cards, the company announced Monday. But they can still buy firearms.
The San Francisco-based bank joined some of its Wall Street peers in banning the purchase of cryptocurrencies on credit cards and said its decision is “in line with the overall industry.”
Read the entire article
On Monday, another shot was fired in the war. Wells Fargo formally announced that their customers would no longer be permitted to purchase Bitcoin and other cryptocurrencies with Wells Fargo credit cards…
Wells Fargo customers can no longer buy cryptocurrencies such as bitcoin on their credit cards, the company announced Monday. But they can still buy firearms.
The San Francisco-based bank joined some of its Wall Street peers in banning the purchase of cryptocurrencies on credit cards and said its decision is “in line with the overall industry.”
Read the entire article
May 23, 2018
Bank Of England Issues Working Paper On Central Bank Digital Currencies
On May 18, the Bank of England released a staff working paper, laying out various scenarios of possible risks and financial stability issues of central bank digital currencies (CBDCs).
The paper constructs three models of CBDC depending on the sectors that have access to CBDC, from a narrow CBDC where access is limited to banks and non-bank financial institutions (NBFIs), to direct and indirect access extended to households and non-financial firms.
The Financial Institutions Access model is limited to banks and NBFIs, where financial institutions can interact directly with the central bank to purchase and sell CBDC in exchange for eligible securities. Financial institutions are not supposed to provide an asset to households and firms, which are entirely backed by central bank money.
The Economy-wide Access model assumes that access to CBDCs is granted to banks and NBFIs, households and firms. In this way, a CBDC can serve as money for all agents in the economy. While only banks and NBFIs can interact directly with the central bank to buy and sell CBDCs, the report says that “households and firms must use a CBDC Exchange to buy and sell CBDC in exchange for deposits.”
Within the Financial Institutions Plus CBDC-Backed Narrow Bank Access model access is again limited to banks and NBFIs. There is at least one financial institution that acts as a ‘narrow bank,’ which provides financial assets to households and firms that are fully backed by a CBDC but that does not extend credit.
Read the entire article
The paper constructs three models of CBDC depending on the sectors that have access to CBDC, from a narrow CBDC where access is limited to banks and non-bank financial institutions (NBFIs), to direct and indirect access extended to households and non-financial firms.
The Financial Institutions Access model is limited to banks and NBFIs, where financial institutions can interact directly with the central bank to purchase and sell CBDC in exchange for eligible securities. Financial institutions are not supposed to provide an asset to households and firms, which are entirely backed by central bank money.
The Economy-wide Access model assumes that access to CBDCs is granted to banks and NBFIs, households and firms. In this way, a CBDC can serve as money for all agents in the economy. While only banks and NBFIs can interact directly with the central bank to buy and sell CBDCs, the report says that “households and firms must use a CBDC Exchange to buy and sell CBDC in exchange for deposits.”
Within the Financial Institutions Plus CBDC-Backed Narrow Bank Access model access is again limited to banks and NBFIs. There is at least one financial institution that acts as a ‘narrow bank,’ which provides financial assets to households and firms that are fully backed by a CBDC but that does not extend credit.
Read the entire article
April 19, 2018
Warsh, Druckenmiller Buy "Basis" - The Central-Bank-Inspired "Stable" Cryptocurrency
On Wednesday, the New Jersey-based cryptocurrency startup 'Basis' announced it had raised $133 million in a round backed by venture capital firms including GV (formerly Google Ventures), Bain Capital, Lightspeed Venture Partners, Andreessen Horowitz, and Sky Capital.
Stanley Druckenmiller, the billionaire hedge fund manager, and Kevin Warsh, the former governor of the U.S. Federal Reserve, also bought in.
Basis co-founder and CEO Nader Al-Naji writes:
"...we are building a cryptocurrency with an algorithmic central bank that we believe will make cryptocurrency stable and usable around the world.
we believe the price volatility of cryptocurrencies is one of their biggest barriers to widespread adoption. Unlike the currencies we use today, most cryptocurrencies do not have a mechanism to keep purchasing power stable. This means that sporadic swings in demand can cause huge changes in price.
This is bad. Imagine you’re paid a salary of 1 Bitcoin per month. If the price of Bitcoin drops, you might not be able to make rent. If it rises, your employer won’t be able to afford your salary. It’s simply not a reliable means of payment.
A currency needs to be stable in order for people to use it. Central banks apply monetary policy to mitigate currency volatility. Until now, there’s been no way to create a cryptocurrency with comparable benefits. And no way for cryptocurrencies to become true currencies."
Read the entire article
Stanley Druckenmiller, the billionaire hedge fund manager, and Kevin Warsh, the former governor of the U.S. Federal Reserve, also bought in.
Basis co-founder and CEO Nader Al-Naji writes:
"...we are building a cryptocurrency with an algorithmic central bank that we believe will make cryptocurrency stable and usable around the world.
we believe the price volatility of cryptocurrencies is one of their biggest barriers to widespread adoption. Unlike the currencies we use today, most cryptocurrencies do not have a mechanism to keep purchasing power stable. This means that sporadic swings in demand can cause huge changes in price.
This is bad. Imagine you’re paid a salary of 1 Bitcoin per month. If the price of Bitcoin drops, you might not be able to make rent. If it rises, your employer won’t be able to afford your salary. It’s simply not a reliable means of payment.
A currency needs to be stable in order for people to use it. Central banks apply monetary policy to mitigate currency volatility. Until now, there’s been no way to create a cryptocurrency with comparable benefits. And no way for cryptocurrencies to become true currencies."
Read the entire article
March 14, 2018
Bitcoin Sinks As Google Moves To Ban All Crypto, ICO Ads In June
Mimiccing its biggest rival for ad dollars - Facebook - Google will ban online advertisements promoting cryptocurrencies and initial coin offerings, and "other speculative financial instruments" starting in June.
Some aggressive businesses found a loophole: purposely misspelling words like "bitcoin" in their ads. A Google spokeswoman said the company’s policies will try to anticipate workarounds like this.
The reaction was immediate across the crypto space but for now is somewhat subdued...
Alphabet’s Google said the new policy will become effective in June across ads bought on its search and display-advertising network, as well as its YouTube unit.
But, as The Wall Street Journal reports, the policy also will restrict ads for nontraditional methods of wagering on the future movements of stock prices and foreign-exchange, such as binary options and financial spread-betting, Google said.
Google said last year it removed more than 130 million ads that were used by hackers to mine for cryptocurrency. That is a very small percentage of the ads run on Google’s ad network.
The company’s director of sustainable ads, Scott Spencer, declined to comment on how much potential ad revenue the company would be turning away by enacting the new policy, saying the decision was made to prevent consumer harm.
Read the entire article
Some aggressive businesses found a loophole: purposely misspelling words like "bitcoin" in their ads. A Google spokeswoman said the company’s policies will try to anticipate workarounds like this.
The reaction was immediate across the crypto space but for now is somewhat subdued...
Alphabet’s Google said the new policy will become effective in June across ads bought on its search and display-advertising network, as well as its YouTube unit.
But, as The Wall Street Journal reports, the policy also will restrict ads for nontraditional methods of wagering on the future movements of stock prices and foreign-exchange, such as binary options and financial spread-betting, Google said.
Google said last year it removed more than 130 million ads that were used by hackers to mine for cryptocurrency. That is a very small percentage of the ads run on Google’s ad network.
The company’s director of sustainable ads, Scott Spencer, declined to comment on how much potential ad revenue the company would be turning away by enacting the new policy, saying the decision was made to prevent consumer harm.
Read the entire article
March 7, 2018
The SPY Of Crypto? Coinbase Launches Cryptocurrency Index Fund
Coinbase dashed the hopes of thousands of ripple investors, who've been holding out hope that the exchange would add the coin, when it revealed that its "major announcement" Tuesday afternoon was, in fact, the introduction of the Coinbase Index Fund, a pioneering investing vehicle that just might do to cryptocurrencies what the ETFs like the SPY did for stocks.
The company published the announcement on its blog:
We’re excited to announce Coinbase Index Fund.
Coinbase Index Fund will give investors exposure to all digital assets listed on Coinbase’s exchange, GDAX, weighted by market capitalization. If a new asset is listed on the exchange, it will be automatically added to the fund.
Index funds have changed the way that many people think about investing. By providing diversified exposure to a broad range of assets, index funds enable investors to track the performance of an entire asset class, rather than having to select individual assets. We’re excited to give our customers the ability to invest in the potential of blockchain-based digital assets as a whole.
Twitter users were unimpressed however because, as the company pointed out, Coinbase and associated exchange GDAX only lists four coins...
The news had some impact on the price of cryptocurrencies, which have been slumping Tuesday, with Ripple lower and the rest bouncing marginally higher...
Read the entire article
The company published the announcement on its blog:
We’re excited to announce Coinbase Index Fund.
Coinbase Index Fund will give investors exposure to all digital assets listed on Coinbase’s exchange, GDAX, weighted by market capitalization. If a new asset is listed on the exchange, it will be automatically added to the fund.
Index funds have changed the way that many people think about investing. By providing diversified exposure to a broad range of assets, index funds enable investors to track the performance of an entire asset class, rather than having to select individual assets. We’re excited to give our customers the ability to invest in the potential of blockchain-based digital assets as a whole.
Twitter users were unimpressed however because, as the company pointed out, Coinbase and associated exchange GDAX only lists four coins...
The news had some impact on the price of cryptocurrencies, which have been slumping Tuesday, with Ripple lower and the rest bouncing marginally higher...
Read the entire article
February 19, 2018
Here's Why Banks Hate Cryptocurrencies
Banks like to pretend that they're so much more established and secure than the world of cryptocurrencies, but as anybody who pays close attention to the headlines would know...that's just not the case...
Setting aside all of their rhetoric about embracing the blockchain, banks have mostly avoided or opposed cryptos (Goldman Sachs, sensing the opportunity for profit, is one notable exception), often citing their volatility and the ease with which they can be used to launder money as qualities that disqualify them from being taken seriously (though, as we recently witnessed with the US dollar, perhaps banks need to rework this volatility argument a bit). Even yesterday's announcement of the first criminal charges against a cryptocurrency trader pales in comparison to the many, many crimes that banks (or even one bank) have settled allegations of. The real answer to why the banks’ dislike cryptocurrencies is probably because they feel threatened. The recent selloff notwithstanding, the rise of cryptocurrencies has continued unabated, despite the efforts of some of the most powerful governments on Earth, while the concept is still very young, it does have potential to shake up the aging fiat system. In order to understand the race between the banks and cryptocurrencies, we developed a visual to see just how "David" is comparing to "Goliath."
Using data from Yahoo Finance and CoinMarketCap.comhttps://howmuch.net/articles/banks-vs-cryptocurrencies, HowMuch.com's data team developed a visual that compares the market caps between some of the world’s largest banks and the largest cryptocurrencies. On the left blue column, there are four banks listed from largest to smallest market caps: JPMorgan Chase, Bank of China, Goldman Sachs, and Morgan Stanley. Conversely, the right red column features the total cryptocurrency market, Bitcoin, Ethereum, Litecoin, NEO, Ripple, Bitcoin Cash, Cardano, and Stellar. The larger the circle, the bigger the market cap.
After an extraordinarily volatile (even for bitcoin) start to the year, cryptocurrencies are rallying once again, with bitcoin breaking above $10,000. As of Feb. 16, 2018, the crypto market had a market cap of $470 billion - larger than the size of the United States’ largest bank, JPMorgan Chase.
Bitcoin's market cap alone is comparable to Bank of China's. The second largest cryptocurrency by market cap, Ethereum, is comparable in size to Morgan Stanley. It is stats like these that have the global banking sector worried that cryptocurrencies are on track to make a serious impact on their operations.
Read the entire article
Setting aside all of their rhetoric about embracing the blockchain, banks have mostly avoided or opposed cryptos (Goldman Sachs, sensing the opportunity for profit, is one notable exception), often citing their volatility and the ease with which they can be used to launder money as qualities that disqualify them from being taken seriously (though, as we recently witnessed with the US dollar, perhaps banks need to rework this volatility argument a bit). Even yesterday's announcement of the first criminal charges against a cryptocurrency trader pales in comparison to the many, many crimes that banks (or even one bank) have settled allegations of. The real answer to why the banks’ dislike cryptocurrencies is probably because they feel threatened. The recent selloff notwithstanding, the rise of cryptocurrencies has continued unabated, despite the efforts of some of the most powerful governments on Earth, while the concept is still very young, it does have potential to shake up the aging fiat system. In order to understand the race between the banks and cryptocurrencies, we developed a visual to see just how "David" is comparing to "Goliath."
Using data from Yahoo Finance and CoinMarketCap.comhttps://howmuch.net/articles/banks-vs-cryptocurrencies, HowMuch.com's data team developed a visual that compares the market caps between some of the world’s largest banks and the largest cryptocurrencies. On the left blue column, there are four banks listed from largest to smallest market caps: JPMorgan Chase, Bank of China, Goldman Sachs, and Morgan Stanley. Conversely, the right red column features the total cryptocurrency market, Bitcoin, Ethereum, Litecoin, NEO, Ripple, Bitcoin Cash, Cardano, and Stellar. The larger the circle, the bigger the market cap.
After an extraordinarily volatile (even for bitcoin) start to the year, cryptocurrencies are rallying once again, with bitcoin breaking above $10,000. As of Feb. 16, 2018, the crypto market had a market cap of $470 billion - larger than the size of the United States’ largest bank, JPMorgan Chase.
Bitcoin's market cap alone is comparable to Bank of China's. The second largest cryptocurrency by market cap, Ethereum, is comparable in size to Morgan Stanley. It is stats like these that have the global banking sector worried that cryptocurrencies are on track to make a serious impact on their operations.
Read the entire article
January 18, 2018
Cryptocurrencies - Questioning The Value Proposition
1) Is Bitcoin Netscape?
2) How limited is the supply of cryptocurrencies?
3) If Bitcoin crashes what happens to other alt-currencies?
4) What asset market lacunae do cryptocurrencies fill?
5) Why mine?
6) Why distribute the ledger?
7) Do cryptocurrency transactions need coins or tokens?
8) Can you make cryptocurrencies KYC and AML compliant?
Concluding comments
Cryptocurrency technology is likely to serve as the basis for executing asset transfers and storing the record of transactions and contracts. Mining, anonymity, and the distributed ledger are not relevant for most of these purposes. The case is not really made that cryptocurrencies are assets and that means that the current pricing proposition is shaky. It is possible that a private issued ‘fiat’ cryptocurrency will trade alongside other assets, but it is still not clear what would give it value.
The underlying proposition is like the Marxist interpretation of history. The intellectual breadth and audacity are breathtaking. The ability to think through ex ante how a new, decentralized currency asset could be constructed and maintained is remarkable. But that doesn’t mean that the underlying premises are correct, or that it solves a problem anyone really worries about.
Read the entire article
2) How limited is the supply of cryptocurrencies?
3) If Bitcoin crashes what happens to other alt-currencies?
4) What asset market lacunae do cryptocurrencies fill?
5) Why mine?
6) Why distribute the ledger?
7) Do cryptocurrency transactions need coins or tokens?
8) Can you make cryptocurrencies KYC and AML compliant?
Concluding comments
Cryptocurrency technology is likely to serve as the basis for executing asset transfers and storing the record of transactions and contracts. Mining, anonymity, and the distributed ledger are not relevant for most of these purposes. The case is not really made that cryptocurrencies are assets and that means that the current pricing proposition is shaky. It is possible that a private issued ‘fiat’ cryptocurrency will trade alongside other assets, but it is still not clear what would give it value.
The underlying proposition is like the Marxist interpretation of history. The intellectual breadth and audacity are breathtaking. The ability to think through ex ante how a new, decentralized currency asset could be constructed and maintained is remarkable. But that doesn’t mean that the underlying premises are correct, or that it solves a problem anyone really worries about.
Read the entire article
January 12, 2018
Henry Ford, Dot.com & Bitcoins
Why history matters
Is ‘history more or less bunk?’ It provides valuable lessons
Henry Ford once said that “history is more or less bunk. It’s tradition. We don’t want tradition. We want to live in the present, and the only history that is worth a tinker’s damn is the history that we make today”. And yet, Ford was aware that he was making history, and his remarks were aimed at the orthodoxy.
What has Henry Ford to do with bitcoins? In 1900 when he was experimenting with cars, there were around 2,000 car makers globally that were producing 10,000 vehicles (some powered by steam). However by 1920, the number of car makers shrunk to around 200, and the industry was manufacturing 2.5m cars and by the 1930s in most DMs, horses were dead and buggy makers were out of business. By the 1980s, the number of car makers dropped below 50 and the industry was making over 30m vehicles. Today, there are over 1,000 cryptocurrencies and their combined value (depending on time of day) is ~US$600-800bn, or ~1% of global money in circulation. Will cryptos follow the same trajectory as their early 20th century cousin and within a decade or so become the dominant force in transactions and store of value?
The key that links cryptos with Henry Ford and the main difference between (say) bitcoin and tulips is that cryptocurrencies are based on sustainable and evolving technological foundations (just as cars were in the early 20th century). To argue that the blockchain is good but cryptos bad is to forget that without various forms of ledger balances (or cryptocurrencies), blockchain is an empty vessel. As in the case of the 17th century Dutch Tulip Mania, the growth of cryptocurrencies is also turbocharged by creeping monetary debasement. It is the marriage of technology and the perceived need for insurance that is likely to guarantee cryptos’ LT role, irrespective what the governments think.
Read the entire article
Is ‘history more or less bunk?’ It provides valuable lessons
Henry Ford once said that “history is more or less bunk. It’s tradition. We don’t want tradition. We want to live in the present, and the only history that is worth a tinker’s damn is the history that we make today”. And yet, Ford was aware that he was making history, and his remarks were aimed at the orthodoxy.
What has Henry Ford to do with bitcoins? In 1900 when he was experimenting with cars, there were around 2,000 car makers globally that were producing 10,000 vehicles (some powered by steam). However by 1920, the number of car makers shrunk to around 200, and the industry was manufacturing 2.5m cars and by the 1930s in most DMs, horses were dead and buggy makers were out of business. By the 1980s, the number of car makers dropped below 50 and the industry was making over 30m vehicles. Today, there are over 1,000 cryptocurrencies and their combined value (depending on time of day) is ~US$600-800bn, or ~1% of global money in circulation. Will cryptos follow the same trajectory as their early 20th century cousin and within a decade or so become the dominant force in transactions and store of value?
The key that links cryptos with Henry Ford and the main difference between (say) bitcoin and tulips is that cryptocurrencies are based on sustainable and evolving technological foundations (just as cars were in the early 20th century). To argue that the blockchain is good but cryptos bad is to forget that without various forms of ledger balances (or cryptocurrencies), blockchain is an empty vessel. As in the case of the 17th century Dutch Tulip Mania, the growth of cryptocurrencies is also turbocharged by creeping monetary debasement. It is the marriage of technology and the perceived need for insurance that is likely to guarantee cryptos’ LT role, irrespective what the governments think.
Read the entire article
December 26, 2017
Some Are Calling This ‘The Bitcoin Crash’, But Others Believe It Is Just A Bump In The Road On The Way To $40,000
Bitcoin, Ethereum, Litecoin and other major cryptocurrencies have been on a wild ride this year, and over the past 10 days the volatility that we have witnessed in the marketplace has been absolutely breathtaking. On December 17th, Bitcoin shot above $19,800 for a brief moment before it started plummeting dramatically. At one point the price of Bitcoin dipped below $11,000, which represented close to a 45 percent decline from the record high that it had hit just five days earlier. And Bitcoin was far from alone – virtually every other major cryptocurrency was also down between 25 and 50 percent during that five day period. But now almost all of them are bouncing back, and at this moment the price of Bitcoin is $14,219.99.
So where do things go from here?
There are many that believe that in the short-term the price of Bitcoin will fall back toward the actual cost of production. It has been estimated that the cost to produce a new Bitcoin is currently between three and four thousand dollars, and with the price of Bitcoin so high there is a tremendous incentive for Bitcoin miners to produce as many as possible right now.
But there are others that are convinced that Bitcoin could eventually go to zero…
Morgan Stanley analyst James Faucette and his team sent a research note to clients a few days ago suggesting that the real value of bitcoin might be … $0.
That’s zero dollars. (Bitcoin stood at around $14,400 at the time of writing.)
Read the entire article
So where do things go from here?
There are many that believe that in the short-term the price of Bitcoin will fall back toward the actual cost of production. It has been estimated that the cost to produce a new Bitcoin is currently between three and four thousand dollars, and with the price of Bitcoin so high there is a tremendous incentive for Bitcoin miners to produce as many as possible right now.
But there are others that are convinced that Bitcoin could eventually go to zero…
Morgan Stanley analyst James Faucette and his team sent a research note to clients a few days ago suggesting that the real value of bitcoin might be … $0.
That’s zero dollars. (Bitcoin stood at around $14,400 at the time of writing.)
Read the entire article
December 22, 2017
Bitcoin Plummets Below $14,000; Peter Schiff Says 'Mark It Zero'
Since CME launched its futures contract, Bitcoin has been under pressure and renowned market watcher Peter Schiff is pretty clear where he thinks this ends up...
As CoinTelegraph reports, speaking to RT this week, renowned analyst Peter Schiff, credited for predicting the 2008 housing market collapse, issued a foreboding warning to investors buying Bitcoin at current prices.
Even with a shaky week, Bitcoin is hovering around the $15,000 mark, after a two-month bull run that saw the price rise by more than 200 percent.
Schiff says those trying to ride the bubble are too late:
“People who got it years ago, even people who got it at the beginning of the year have the opportunity to cash out and make a lot of money. But people who are buying it at these prices or higher prices are going to lose practically everything.”
The old adage, “buy on the rumor and sell on the news,” seems to be the perfect way to sum up Schiff’s sentiments on the current attitude of green investors trying to make a quick buck out of Bitcoin:
“These currencies are going to trade to zero or pretty close to it when the bubble pops. Right now, the only reason why people are buying Bitcoin is because the price is going up. When it turns around, they are not going to sell it for the same reason."
Read the entire article
As CoinTelegraph reports, speaking to RT this week, renowned analyst Peter Schiff, credited for predicting the 2008 housing market collapse, issued a foreboding warning to investors buying Bitcoin at current prices.
Even with a shaky week, Bitcoin is hovering around the $15,000 mark, after a two-month bull run that saw the price rise by more than 200 percent.
Schiff says those trying to ride the bubble are too late:
“People who got it years ago, even people who got it at the beginning of the year have the opportunity to cash out and make a lot of money. But people who are buying it at these prices or higher prices are going to lose practically everything.”
The old adage, “buy on the rumor and sell on the news,” seems to be the perfect way to sum up Schiff’s sentiments on the current attitude of green investors trying to make a quick buck out of Bitcoin:
“These currencies are going to trade to zero or pretty close to it when the bubble pops. Right now, the only reason why people are buying Bitcoin is because the price is going up. When it turns around, they are not going to sell it for the same reason."
Read the entire article
December 20, 2017
The Washington Post Says That Fedcoin Will Be ‘Bigger’ Than Bitcoin
Fedcoin doesn’t even exist yet, and yet the Washington Post is already hyping it as the primary cryptocurrency that we will be using in the future. Do they know something that they rest of us do not? Just a few days ago I warned that global central banks could eventually try to take control of the cryptocurrency phenomenon, and so I was deeply alarmed to see the Post publish this sort of an article. We want cryptocurrencies to stay completely independent, and we definitely do not want the Federal Reserve and other global central banks to start creating their own versions. Because of course once they create their own versions they will want to start restricting the use of any competitors.
The one thing that could derail the cryptocurrency revolution faster than anything else would be interference by national governments or global central banks. Unfortunately, now that Bitcoin, Litecoin, Ethereum and other cryptocurrencies are getting so much attention, it is inevitable that the powers that be will make a move.
On Monday, the Washington Post published an opinion piece by Professor Campbell R. Harvey of Duke University that was entitled “Bitcoin is big. But fedcoin is bigger.” These days, there is an agenda behind virtually everything that the Washington Post publishes, and so it is not just a coincidence that they have published an article with “fedcoin” in the title. Here is how that article begins…
Over the past few weeks, investors have been flocking to bitcoin, the digital currency whose value has soared by about 2,000 percent in the past year alone. And while many economists are cautioning against excitement about bitcoin — which is caught up in what may be one of the biggest speculative bubbles in history — it’s important to note just how revolutionary the technology may be.
Indeed, the technology underlying bitcoin could fundamentally change the way we think of money.
Read the entire article
The one thing that could derail the cryptocurrency revolution faster than anything else would be interference by national governments or global central banks. Unfortunately, now that Bitcoin, Litecoin, Ethereum and other cryptocurrencies are getting so much attention, it is inevitable that the powers that be will make a move.
On Monday, the Washington Post published an opinion piece by Professor Campbell R. Harvey of Duke University that was entitled “Bitcoin is big. But fedcoin is bigger.” These days, there is an agenda behind virtually everything that the Washington Post publishes, and so it is not just a coincidence that they have published an article with “fedcoin” in the title. Here is how that article begins…
Over the past few weeks, investors have been flocking to bitcoin, the digital currency whose value has soared by about 2,000 percent in the past year alone. And while many economists are cautioning against excitement about bitcoin — which is caught up in what may be one of the biggest speculative bubbles in history — it’s important to note just how revolutionary the technology may be.
Indeed, the technology underlying bitcoin could fundamentally change the way we think of money.
Read the entire article
December 18, 2017
Bitcoin Is Now Worth More Than Wal-Mart (The Entire Company)
Would you rather own 100% of Wal-Mart or every Bitcoin in existence? At one point such a question would have been completely absurd, but now things have changed. As I write this article, Wal-Mart has a market cap of 287.68 billion dollars. Wal-Mart is the king of the retail industry in America, and nobody else is even close. Bitcoin, on the other hand, is an entirely digital creation that did not even exist until 2009. No government or central bank in the entire world recognizes it as a legitimate currency, and there are very, very few retail establishments that are willing to accept Bitcoin as a form of payment. And yet at this moment, Bitcoin has a market cap of 310 billion dollars.
When the year began, Bitcoin had just crossed the $1,000 threshold, and now it is selling for more than $18,000. Of course other cryptocurrencies have been rising at an even faster pace. We have never seen anything quite like this before, and some are warning that this is a giant bubble that is about to burst…
Axel Weber, the board chairman of big bank UBS, has warned of a possible Bitcoin currency crash. With increasing numbers of small investors jumping on the cryptocurrency bandwagon, it is time for regulators to intervene, he says.
Bitcoin has surged from $1,000 (CHF990) at the start of the year to above $16,000.
The risks are due to a design fault, which leads to huge currency swings in both directions, Weber said in an interview with the NZZ am Sonntagexternal link. “We as a bank have very consciously warned against this product, because we do not consider it valid and sustainable,” said Weber.
Read the entire article
When the year began, Bitcoin had just crossed the $1,000 threshold, and now it is selling for more than $18,000. Of course other cryptocurrencies have been rising at an even faster pace. We have never seen anything quite like this before, and some are warning that this is a giant bubble that is about to burst…
Axel Weber, the board chairman of big bank UBS, has warned of a possible Bitcoin currency crash. With increasing numbers of small investors jumping on the cryptocurrency bandwagon, it is time for regulators to intervene, he says.
Bitcoin has surged from $1,000 (CHF990) at the start of the year to above $16,000.
The risks are due to a design fault, which leads to huge currency swings in both directions, Weber said in an interview with the NZZ am Sonntagexternal link. “We as a bank have very consciously warned against this product, because we do not consider it valid and sustainable,” said Weber.
Read the entire article
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