Eddy Lazzarin, CTO of A16z Crypto, one of the largest cryptocurrency-focused venture capital funds, has criticized the meme coins’ effect on the broad appreciation of the cryptocurrency market. Lazzarin stated that meme coins undermined the “long-term vision of crypto” that has maintained some actors in the space, making it look “like a risky casino.” A16z […]
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Bitcoin Approaches Risky Territory As Halving Event Draws Near
The price of Bitcoin has been on a downward trend since it reached a new all-time of ,000, ushering in a wave of speculations regarding the crypto asset’s next direction in the short term.
In the past few days, Bitcoin’s recent dip has triggered a general crypto market retracement. With the Bitcoin Halving event fast approaching, many crypto analysts are anticipating a further decline in BTC’s price in the near future.
Bitcoin Poised For “Danger Zone” Ahead Of Halving Event
Popular cryptocurrency trader and analyst Rekt Capital has shared a gloomy prediction for Bitcoin with the crypto community on the social media platform X. His forecast examines BTC’s potential to drop even further prior to the halving event while noting the entrance to a risky area he dubbed the “Danger Zone.”
The analyst’s forecast came in light of BTC experiencing a notable decline in the past few days. According to the expert, two days from now, Bitcoin will formally venture into the danger Zone (orange).
This is the starting area of past retracements seen ahead of the BTC Halving, which is expected to take place in April. Prior to the halving, these retracements have constantly indicated intervals of substantial market corrections for the digital asset.
Rekt Capital further pointed out that the pre-halving retracements have historically been observed in BTC 14-28 days before the event. Bitcoin’s price witnessed a pullback of about 40% in advance of the 2016 halving occurrence.
Meanwhile, in 2020, the crypto asset fell by over 40% before the occasion. Presently, we are less than 30 days before this year’s BTC halving takes place; however, the price of the coin has declined by over 11% in the past week, suggesting further correction in the coming weeks.
The post read:
In 2 days, Bitcoin will officially enter the “Danger Zone” (orange) where historical Pre-Halving Retraces have begun. Historically, Bitcoin has performed Pre-Halving Retraces 14-28 days before the Halving. In 2020, this retrace was -20% deep, and in 2016, this retrace was -40% deep. Currently, BTC is 30 days away from the Halving and has pulled back -11% this week.
It is noteworthy that the crypto analyst had previously pinpointed the timeframe BTC is expected to top out in this bull cycle. Rekt Capital believes the asset will peak within 280-350 days. Specifically, this could occur around mid-December this year, or in mid-February of next year.
4 Distinct Halving Phases
So far, the crypto analyst has highlighted several different phases for the upcoming Bitcoin Halving; these include the Pre-Halving Rally, Final Pre-Halving Retrace, Re-accumulation, and Parabolic uptrend.
According to Rekt Capital, there usually is a pre-halving rally approximately 60 days before the event takes place. For the final pre-halving retrace, it usually develops around 14 to 28 days ahead.
Furthermore, after the Pre-Halving pullback, a multi-month re-accumulation period follows. Lastly, the parabolic uptrend begins once Bitcoin exits the area of re-accumulation.
Dave Ramsey’s Team Insists Crypto Isn’t a Good Investment — Says It’s ‘Risky for a Lot of Reasons’
Personal finance expert and best-selling author Dave Ramsey’s firm Ramsey Solutions has maintained that crypto is not a good investment. “We’re not saying cryptocurrency is going to go away. And we’re not saying it’s horrible … But as things stand today, just say no,” advised the Ramsey Solutions team. Ramsey Solutions Advises ‘Just Say No’ […]
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Hong Kong’s SFC Issues Warning on Floki’s ‘Highly Risky’ Staking Programs
A Hong Kong watchdog, the SFC, has cautioned investors about the enticing yet potentially risky ‘Floki Staking Program’ and ‘Tokenfi Staking Program,’ which offer high annualized returns without the required regulatory green light.
SFC Warns Against Unregulated Floki and Tokenfi Crypto Staking Programs
The Hong Kong Securities and Futures Commission (SFC) has issued a public warning against the “Floki Staking Program” and “Tokenfi Staking Program,” two crypto-related investment products promising unusually high returns.
Both programs, associated with the Floki ecosystem, offer cryptocurrency staking services with promised annualized returns ranging from 30% to over 100%. However, the SFC states that these products have not received the necessary authorization for public offering in Hong Kong, thereby placing potential investors at risk.
Staking, a process akin to depositing money into a savings account, contributes to blockchain operations. Staked cryptocurrencies are locked up in a project. The project then uses these staked coins to maintain its operations, such as validating transactions. Despite its growing popularity, the SFC warns that such arrangements might constitute unauthorized collective investment schemes.
The SFC’s investigation revealed that “[t]he administrator of the two products has also not been able to demonstrate to the SFC’s satisfaction how the high annualised return targets could be achieved.” As a result, the SFC included both the “Floki Staking Program” and “Tokenfi Staking Program” in its Suspicious Investment Products Alert List on Jan. 26.
Addressing these developments, the Floki team acknowledged the SFC’s concerns in their weekly recap live spaces on the X. They contended that the SFC’s primary issue was the programs’ high performance. While confirming their collaboration with a marketing agency for the promotion of these programs, Floki admitted to a lack of clarity regarding the continuation of their campaign in Hong Kong. They assured investors of their commitment to comply with local regulations.
In addition to the risk of participating in unregulated schemes, the SFC cautioned investors about the allure of “too-good-to-be-true” returns. The SFC underlined that such investments could lead to a total loss, with minimal protection under the Securities and Futures Ordinance (SFO).
The SFC has stated its intention to take appropriate legal action against any breach of the law, including the promotion of unlicensed collective investment schemes.
Do you think the SFC is doing a public service by warning people about Floki’s staking products? Share your thoughts and opinions about this subject in the comments section below.
SEC Warns Crypto Investments Can Be ‘Exceptionally Risky’
The U.S. Securities and Exchange Commission (SEC) has renewed its warning that investments in crypto assets can be “exceptionally risky.” The regulator stressed that crypto-related investments “continue to be replete with fraud, including bogus coin offerings, Ponzi and pyramid schemes, and outright theft where the project promoter simply disappears with investors’ money.”
SEC’s Crypto Investment Warnings
The U.S. Securities and Exchange Commission (SEC)’s Office of Investor Education and Advocacy reiterated its warnings about investing in crypto assets on social media platform X on Friday. “Investments in crypto asset securities can be exceptionally risky and are often volatile,” the authority wrote.
Investments in #crypto asset securities can be exceptionally risky and are often volatile. Learn more in our Investor Alert: https://t.co/Qd9ps9BPvm pic.twitter.com/dTlk9LE2KV
— SEC Investor Ed (@SEC_Investor_Ed) December 8, 2023
The SEC’s investor education office also shared a link to an investor alert it published in March titled “Exercise Caution with Crypto Asset Securities.”
The alert highlights several key points relating to investing in crypto assets. Firstly, “Those offering crypto asset investments or services may not be complying with applicable law, including federal securities laws.” Noting that no crypto asset entity is registered with the SEC as a national securities exchange, such as the New York Stock Exchange (NYSE) or the Nasdaq Stock Market, the alert cautions:
Investors in crypto asset securities may not benefit from rules that protect against fraud, manipulation, front-running, wash sales, and other misconduct when intermediaries for those products do not comply with the federal securities laws that apply to registered exchanges.
Next, the alert emphasizes that “Fraudsters continue to exploit the rising popularity of crypto assets to lure retail investors into scams, often leading to devastating losses.” The authority cautioned: “Crypto asset securities-related investments continue to be replete with fraud, including bogus coin offerings, Ponzi and pyramid schemes, and outright theft where the project promoter simply disappears with investors’ money.”
Another point highlighted in the alert states:
Having an investing plan, as well as understanding your risk tolerance and time horizon, can be critical to your investing success.
The debate over crypto tokens being securities or commodities continues to cast a shadow over the U.S. crypto industry. While SEC Chair Gensler asserts all crypto tokens except bitcoin (BTC) are securities, a recent court ruling on XRP suggests otherwise. Meanwhile, the SEC’s silence on ether (ETH), the second largest cryptocurrency, adds to the confusion, prompting accusations of deliberate obfuscation from lawmakers, including Congressman Tom Emmer. There is currently a bill in Congress that seeks to remove Gensler as the chairman of the SEC.
The SEC is currently evaluating 13 spot bitcoin exchange-traded fund (ETF) applications. Several analysts expect the securities watchdog to approve multiple spot bitcoin ETFs at once early next year.
What do you think about the SEC warning about the risks of investing in crypto tokens? Let us know in the comments section below.
Filmmaker Makes Millions After Risky Dogecoin Bet Pays Off — Faces Netflix Lawsuit
A U.S. filmmaker reportedly made a profit of more than million from a bet on the cryptocurrency dogecoin. Netflix accuses the filmmaker of using funds meant for the production of a TV series to place risky bets on a biotech company, the S&P 500, and dogecoin.
Rinsch Lost .9 Million in a Matter of Weeks
Carl Erik Rinsch, a U.S. filmmaker who reportedly earned a profit of more than million from a dogecoin bet, is being sued by Netflix for allegedly breaching the terms of a contract. The lawsuit accuses Rinsch of misappropriating millions of dollars that were intended to fund the production of a science-fiction television series.
Before betting on the meme coin, Rinsch is also accused of using the production funds — approximately million — to place risky bets on Gilead Sciences’ stock. At the time, the biotech firm had begun testing a Covid-19 vaccine and Rinsch reportedly wagered that Gilead Sciences’ stock would soar if the drug proved to be effective in suppressing the virus. The filmmaker is also said to have wagered that the S&P 500 index, which had declined by 30% at that point, would continue to fall.
However, neither bet panned out and Rinsch lost .9 million in a matter of weeks. According to a New York Times report, in the months that followed Rinsch began to behave “more erratically.” Netflix executives only became aware of the extent of Rinsch’s mental health problems after his wife came forward. This ultimately led to Netflix’s March 18, 2021, decision to stop funding the series.
‘God Bless Crypto’
Despite this decision and the subsequent exchanges between himself and Netflix as well as its lawyer, Rinsch still proceeded to use the remaining million to buy dogecoin. By the time he liquidated his dogecoin position in May 2021, Rinsch’s account with the cryptocurrency exchange Kraken had a balance of more than million. Pleased with the outcome, the filmmaker reportedly said, “Thank you and God bless crypto.”
Afterwards, Rinsch went on a shopping spree in which he bought five Rolls Royce luxury cars, a Ferrari, and a Vacheron Constantin watch worth 7,630 among other items. Overall, Rinsch is believed to have spent as much as .7 million.
Meanwhile, according to the New York Times report, Rinsch, who suffers from autism and attention deficit hyperactivity disorder (ADHD), insists it is Netflix which breached the terms of the contract. For the breach, the filmmaker reportedly wants the streaming service provider to pay him million in damages.
An arbitrator has already heard both parties’ arguments and is now expected to give a ruling, the report added.
What are your thoughts on this story? Let us know what you think in the comments section below.
SEC Sues Bankrupt Crypto Lender Celsius, Alleges Misrepresentation of Customer Count and Risky Practices
The U.S. Securities and Exchange Commission has filed a lawsuit against the now-defunct cryptocurrency lender, Celsius. The suit, filed Thursday, also names former CEO Alexander “Alex” Mashinsky as a defendant. Both he and the company stand accused of falsely promising investors a safe investment with high returns.
Bankrupt Crypto Lender Celsius Accused by SEC of Misleading Investors
The U.S. Securities and Exchange Commission has targeted the bankrupt cryptocurrency lender, Celsius, in a lawsuit filed in New York. The SEC accuses Celsius and its former CEO of making fraudulent promises through its “Earn Interest Program.” According to the SEC, Celsius “misled investors about the financial success of Celsius’s business.”
The SEC contends that in June 2022, the defendants’ complex scheme began to collapse, leaving investors unable to withdraw billions of dollars in cryptocurrency assets from Celsius’s online platform. “Defendants made numerous false and misleading statements to induce investors to purchase CEL and invest in the Earn Interest Program,” the SEC lawsuit reveals.
The lawsuit against Celsius follows similar actions targeting Binance and Coinbase. The SEC also disclosed that it settled charges against RSE Markets Inc. on July 12 for operating as an unregistered exchange. The court filing alleges that Celsius engaged in risky trading practices and made uncollateralized loans in an attempt to generate the necessary revenue, thereby putting the entire Celsius enterprise at significant risk. The SEC complaint states:
[Celsius executives] misrepresented Celsius’s financial success to make the company appear more profitable and stable than it was.
The SEC lawsuit arrives as Celsius nears the conclusion of its Chapter 11 process. The company’s mining division is undergoing restructuring, and liquidators have disclosed plans to sell specific altcoins on the open market. The SEC also alleges that Celsius misrepresented its customer count, claiming to have 1 million clients when, in fact, the firm had 500,000 registered customers, many of whom were inactive.
What do you think about the SEC lawsuit against Celsius? Share your thoughts and opinions about this subject in the comments section below.
Singapore To Restrict Highly Risky Crypto Investment Marketing
Singapore, one of the world’s most progressive financial cities and home to many crypto investment companies, is cracking down on advertisements for digital asset services within its borders.
The Monetary Authority of Singapore, which to summarize: “This new law will effectively ban advertisements related to digital currencies.” It’s another setback for cryptocurrency suppliers as more countries regulate this sector.
The Financial Authority of Singapore has issued guidelines to crypto investment companies that urge them to cautionary advertising and marketing in public areas and bodily or digital currency trading. The government agency says these practices are dangerous for most people because they can lead others into losing their funds when something goes wrong with your investment strategy – which could happen at any time.
As authorities have already upset several companies with the gradual approvals, these new rules might create an even more competitive environment.
Crypto suppliers should not use social media platforms or other public sites to attract new customers. They can’t advertise on buses, trains, and places where they stop as well – nor through broadcast/print media, for that matter. Offering ATMs with crypto tokens is also discouraged.
Bitcoin Price remains steady after January 24, 2022 recovery | Source: Tradingview.com
Cryptocurrency exchanges should not pay influencers to promote their services. This is because Singaporean law requires all advertising material to indicate who produced it and what they want people to know about the product/service.
Their marketing campaigns will continue through the company’s own websites, social media accounts, or app stores.
“Cryptocurrencies are extremely hazardous and never appropriate for most people,” Yee Siew, Assistant Managing Director of Coverage, Funds & Monetary Crime at MAS, said in a press release on Monday.
Singapore Government Action To Pause All Types of Marketing
The Singaporean central financial institution has taken an interesting approach by labeling cryptocurrencies as ‘DPT’s” which stands for digital payment tokens. This new classification will help them keep up with the recent trends in cryptocurrency trading and invest more wisely than before.
In an effort to get people into their crypto exchange, Foris DAX Asia has been hiring some top Hollywood talent. They’ve rented out American actor Matt Damon for advertisements and even splashed out on his services to make it seem more appealing.
The Hollywood star appeared on multiplex screens throughout Singapore, promoting Crypto.com. The tagline “Fortune favors the courageous” popped up earlier than motion pictures startup.
Based on the latest from MAS, advertisements for DPT games should no longer be used in public venues.
Crypto.com disclaimer reads:
“The Financial Authority of Singapore (MAS) requires us to supply this danger warning to you as a buyer of a digital fee token (DPT) service supplier. Please observe that you could be not be capable to get well all the cash or DPTs you paid to Foris DAX Asia Pte Ltd if Foris DAX Asia Pte Ltd enterprise fails.”
Singapore’s Monetary Regulator (MAS) has been vocal about its stance on digital currency. The country’s laws specify that service providers who fail to observe the rules face penalties. It’s more likely for them when companies ignore public safeguards and continue working legally within our borders. This could lead MAS to take action against these businesses to prevent negative consequences.
Time will tell how this new advertising and marketing framework affects businesses. Still, MAS instructed some DPT gamers to wind down old campaigns or fulfill contractual obligations before penalizing them.
Crypto Investment Advertisement Framework
Singapore’s Central Financial Institution is taking an identical stance on crypto investment advertising as Britain. The UK’s Advertising Standards Authority has moved to clamp down against any misleading or deceptive ads that may be running throughout this new digital economy – and it looks like they’re going balls out when doing so.
With so many digital currency providers in need of licenses, it’s no wonder that the government has been slow to respond. So far, they’ve only granted five permits out of 180 purposes for these “digital fee token provider” companies – and those are just since January 2020 when Act took effect.
The Singaporean Finance Agency (SFA) recently released a statement highlighting their framework for cryptocurrencies and blockchain technology, noting that it’s important to have guardrails in place when adopting new technologies.
Shadab Taiyabi, president of the SFA, says:
“The expertise behind blockchain has the potential to open many thrilling alternatives for the trade and convey advantages to shoppers. Opening the doorways to innovation additionally requires a system of checks and balances to be put in place earlier than shoppers achieve full consciousness and understanding of the brand new instruments.”
Featured image from Pixabay, chart from TradingView.com
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Parabolic Bitcoin Price Structure In Danger: Cycle Climax Or Risky Reset?
Bitcoin price is now below ,000 for the first time in a month, and despite the still-high prices the market is in a panic. There’s now widespread fear that the current market cycle has peaked and things will soon fall back into a bear phase.
At the same time, there’s a looming bubble about to pop, aggressive tax measures and coming enforcement from the US government, and more that’s recently taken the legs out from beneath the bull run. Is this really the cycle climax, or just time for a long overdue reset?
Bitcoin Price Action Turns Deadly Fast, Bears Blindside Bulls
Rewind to only just a week or so ago, and full blown exuberance was in the air. Coinbase Global had gone public, listed on the Nasdaq for the first time and ushering in a “new paradigm” in crypto.
Related Reading | Bitcoin Price Breakdown: Bulls In Trouble As ,000 Is Lost
Things have certainly been going well for the asset class, garnering support from brands like PayPal, Venmo, and even Tesla. With corporations buying up what little BTC is left on exchanges – a number that has been rapidly decreasing – and expectations of more than 0,000 per coin, FOMO has been aggressive.
Dip buying at every drop has formed a parabolic price structure, that’s unfortunately at risk of breaking down.
A rare signal calls the top as price action falls to parabolic curve | Source: BTCUSD on TradingView.com
Crypto Cycle Climax Could Be Upon Us Unexpectedly
The chart above demonstrates just how risky the situation is right now for the leading cryptocurrency by market cap. Along with price action ready to smash through the parabolic curve just as bad news starts to come in, a rare cycle top based on Pi has appeared for only the fourth time in the asset’s young history.
Related Reading | Bitcoin Loses Important Lifeline That Got Bulls Blood Pumping
The tool has called several important tops, including two out of three that led to extended bear markets in Bitcoin. When parabolic assets break down, data suggests that they retrace a full 80% of their gains. The last market cycle saw the cryptocurrency fall a full 84% before rebounding after this signal appeared.
Another 84% drop here would take Bitcoin back to around ,000. A retracement of that magnitude, would be shocking to all and certainly not what projections suggest. A fall of that size would also suggest a bear market, sooner than most would have expected.
Could our friend Elliott Wave "hi" and save the day? | Source: BTCUSD on TradingView.com
Another theory involves Elliott Wave and says that so long as the top cryptocurrency never makes it below the January 2019 top, the foundation of the bull market is still strong and should continue once the dust settles.
Volatility is coming, so don’t get caught up in the storm that could soon ensue.
Featured image from Pixabay, Chart from TradingView.com
King of the Hill: Top Crypto Investor Explains Why Altcoins Are Highly Risky
As surprising as this may seem, Bitcoin has been underperforming its crypto ilk over the past few weeks; data from CoinMarketCap shows that Bitcoin dominance — the percentage of this market made up by BTC — has fallen from 66% to 64.9% in the past three days.
To further contextualize this, as of the time of this article’s writing, Bitcoin has fallen 6% in the past 24 hours while both Ethereum and XRP have posted relatively strong performances of -3%.
There’s little to explain this trend; in fact, a top crypto investment fund recently reduced its exposure to altcoins and increased its allocation to Bitcoin. Here’s why it did that.
Crypto: Will Bitcoin Outperform In This Crisis?
In “Crypto In This Crisis: Pantera Blockchain Letter, March 2020,” Dan Morehead and Joey Krug of blockchain-centric fund Pantera Capital explained that Bitcoin will “probably out-perform other tokens for a while,” explaining that it is one of the crypto projects that are entrenched and doesn’t rely on funding per se:
It’s a project that’s already built, it works, it has an 11-year track record. Many newer blockchain and smart contract projects are still in development and might be stressed to raise funding to complete their development.
They further explained that “there’s typically a flight-to-quality” or flight to safety “where people want to put money in the mega-caps, the safest asset, “the Treasuries” of the industry.” In the case of crypto assets, Bitcoin is a Treasury bond, as it is much more liquid than the rest.
Bitcoin Could Hit New Highs Within a Year: Pantera CEO
Pantera doesn’t only think the crypto market will begin to recentralize around Bitcoin, the fund also thinks the leading digital asset will outperform amid these times of crisis.
Earlier in the letter, Morehead explained that the unorthodox monetary and fiscal response to the crisis will be extremely bullish for Bitcoin. He wrote:
As governments increase the quantity of paper money, it takes more pieces of paper money to buy things that have fixed quantities, like stocks and real estate, above where they would settle absent an increase in the amount of money. The corollary is they’ll also inflate the price of other things, like gold, bitcoin, and other cryptocurrencies.
As to how exactly it will affect Bitcoin, Morehead explains that with this backdrop, it will take around 12 months for the BTC price to “set a new record” above ,000, which would mark at least a 230% rally from the current price point of ,200 in under a year’s time.
Featured Image from Shutterstock
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