Eric Piscini, CEO of Citizens Reserve and Deloitte’s former blockchain lead, outlines the key threads of 2018 and how they signal what’s coming for 2019.
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Bitcoin Will Likely Survive the Crypto Winter Before Any Other Crypto Asset
Exactly one year ago, the price of bitcoin had reached its all-time high – at almost ,000 – that paved the way for some enthusiastic bullish calls. Mike Novogratz, a former Goldman Sachs official, predicted that the digital currency would touch the ,000-mark. Fundstrat CEO Thomas Lee said bitcoin would establish a new high at ,000. Some analysts even predicted that it would overreach its upside targets by jumping anywhere between ,000 to million.
However, at press time, Bitcoin value is standing at a meager ,500, still lurking toward its downside targets.
Not Bitcoin Fault
For a digital currency that had everything going right for itself, especially when it comes to regulation and institutional adoption, bitcoin was let down more by its surroundings than its own fundamental or technical faults. As it boomed, Bitcoin became a prime example of how a store of value asset should look like. Those who believed in its long-term prospects held it closer while others used it as money to purchase cheaper crypto assets, commonly known as ICO tokens.
The speculators thought that purchasing ICO tokens would give them an early mover advantage in projects that promised to be better than bitcoin. But as more than 50% of these projects failed to deliver onto their promises, or turned out to be vaporware/scams, all the long investors lost money as well as the opportunity they could have had with bitcoin.
The ICO projects, meanwhile, covered their operational as well as leisure expenses by selling bitcoins they had raised, adding a negative pressure on the digital currency against an unspecified demand. The year 2018 saw ICO tokens crashing because of lack of underlying revenue models, and bitcoin because the ICO projects took it for a deadly ride.
As usual, bulls had not thought of such a scenario to take place, for they were relying on the adoption while predicting majestic upside targets for the digital currency.
What’s Next for Bitcoin
ICO market is almost dead, said Novogratz during one of his recent interviews. His analogy was based on the legal actions taken by the US Securities and Exchange Commission (SEC) against projects that raised funds without obtaining approval from their office. And indeed, even in the absence of the SEC’s scrutiny, investors have visibly learned their lesson after losing millions to dim blockchain projects. Bitcoin is merely facing the heat of the overall crypto market, despite being the one that continues to stick to its long-term motives.
The year 2019, therefore, is an essential year for the digital currency, for it marks the beginning of an earnest market where investors are more professional and learned. They will enter the space after getting equipped with its fundamental factors, primary the launch of mainstream investment products like futures and ETFs. And most importantly, they won’t be giving their bitcoin holdings to any run-of-the-mill blockchain project, not unless it has a concrete business model for long-term.
Bitcoin will move to its proper direction, eventually to attain the status of digital gold. There are bumps expected anyway, because of the ongoing economic slowdown as US Dollar improves. But when the value will move from the FIAT reserves, it will likely move to markets like gold, stocks, and indeed, crypto.
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ICOs Continue To Liquidate Ethereum (ETH) War Chests Amid “Crypto Winter”
Since 2018’s cryptocurrency “winter” came into existence, tokens generated via initial coin offerings (ICOs) have severely underperformed their macro cap counterparts, namely Bitcoin (BTC) and Ethereum (ETH). This has led a multitude of projects, who formerly relied upon their ICO-funded war chests, to take drastic measures in a bid to stay afloat.
ICO-funded Projects Sell 416,000 Ethereum (ETH) In Past 30 Days
According to data gathered by Santiment, relayed through TrustNodes, ICO-funded projects have spent (sold) a jaw-dropping 416,000 ETH in the past 30 days. At the current price of , such an amount of Ether amounts to .19 million in U.S. dollars — not a small sum, to say the least. This recent influx of liquidation orders is purportedly the most notable since the Summer.
Per Santiment, a leading cryptocurrency analytics provider, SingularDTV has been the largest spender of Ether in the past month, reducing its ETH balance to 165,000 after utilizing 60,370. Aragon and Kyber Network followed closed behind SingularDTV, both liquidating 50,000 Ether in the aforementioned time frame. It is important to note, however, that Ethereum-centric projects still have millions of Ether in their still-stocked war chests.
Regardless, this recent move underscores the fact that a number of projects have been subject to bear market-induced pressure.
Hasn’t Been Easy To Stay Afloat In A Crypto Bear Market
Interestingly, Ethereum-centric chat application Status, which has been a high-rolling ETH spender in the past month, recently divulged that it would be cutting 25% of its staff (~25 employees). In an address to Status’ recent townhall, Jarrad Hope, the co-founder of the upstart, claimed that as his firm’s war chest has been reduced drastically, it was logical to layoff “non-essential” staffers. Hope even asked employees to take a pay cut, in an apparent bid to extend Status’ runway, and to survive the tumult that cryptocurrencies have found themselves in.
Although such a business decision is evidently tough, some would argue that Status has had it easy. Steemit, the private company behind a decentralized media platform that shares its name, also had to undergo a shift in business in recent weeks. As reported by NewsBTC previously, Steemit CEO Ned Scott took to his personal Youtube channel to layoff “close to 70% of the team.” Ethereum development studio ConsenSys followed suit, claiming that it had purged 13% of its employees, as it had become apparent that the distributed startup had overextended its funding.
Related Reading: Crypto Jobs Get Squeezed as Markets Continue to Free-fall
While ConsenSys, Steemit, and Status are evidently reeling in pain, metaphorically speaking, some startups have been wiped off the face of Earth entirely. ETCDEV, a key development consortium in the Ethereum Classic ecosystem, folded just two weeks back, with the firm’s CTO citing financial restraints as the catalyst behind the group’s collapse. This revelation comes just days after Artamonov, the firm’s CTO, released a Medium article lambasting one of his peers for being a “Trojan Horse” for another team.
Featured Image from Shutterstock
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Cryptocurrency Market Update: Crypto Winter is Getting Colder
FOMO Moments
Cryptocurrency markets still falling; Bitcoin Cash is almost dead, Maker and Tezos in pain.
Red is the dominant colour on crypto markets for yet another day as Bitcoin and its brethren continue their downward slide. There has been no letup in bearish pressure as market capitalization falls back to around 0 billion.
More stories of doom and gloom have appeared about Bitcoin over the past couple of days with predictions of a fall to ,500. At the moment BTC has fallen through support at ,000 to an intraday low of ,740 before making a rebound to ,860 where it has currently leveled out.
Yet again Ethereum has dumped even further after losing another 4% on the day and is hovering just over 0, its lowest level since May 2017. Bitcoin Cash is dying a slow death – ten percent more lost has left BCH at around 5, a shocking 97% down from its all-time high. Stellar is also having a bad day with a 5% slide but Bitcoin SV has made a little back today, 5% to get to . Cardano has been dumped out of the top ten and replaced by Tron.
Binance Coin and Zcash are all dropping over 6% making them the top twenty’s worst performers of the day. VeChain has made a marginal gain as it edges back towards this group at the expense of Dogecoin and Maker which is in a lot of pain today losing 12%.
Today’s big pump is Polymath which has made around 18%, Factom is also performing well as it adds another 16% and Linkey is the only other altcoin making double figure gains during the day’s Asian trading session. Aeternity, DEX and Tezos have taken big dumps today dropping around 12% each at the time of writing. Yesterday’s fomo coin Waves is losing all gains today with a slide of 10%.
Total market capitalization has retreated a further percent and a half today as it falls back to 3 billion. Markets are currently rebounding from an intraday low of below 0 billion a few hours ago but are still down on yesterday’s levels. The crypto winter is getting colder.
FOMO Moments is a section that takes a daily look at the top 20 altcoins during the current trading session and analyses the best performing ones, looking for trends and possible fundamentals.
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Legendary Venture Capitalist: “We’re Close to a Crypto Nuclear Winter”
It’s no secret that 2018 has proven to be a rough year for the cryptocurrency markets, which have seen their market capitalization plummet from highs of over 0 million in January of 2018 to recently established yearly lows of under 0 billion.
The poor market performance, which can be attributed to little more than a boom-and-bust market cycle, has left many investors wondering when the markets will recover, and looking towards upcoming platforms and products being offered by major players in the world of finance, including an institutional investment platform from Fidelity, and a Bitcoin product from the ICE-backed company, Bakkt.
Despite there being positive developments occuring, one legendary investor warns that the cryptocurrency markets may be entering into a “nuclear winter,” while also noting that the technology is exciting and that it does have an exciting future.
The comments were made by Jim Breyer, a billionaire investor who has board seats in notable companies, including Dell, Blackstone, and Walmart, during Fortune’s 2018 Global Tech Forum in Guangzhou, China.
During the final keynote session of the event, Breyer, who is vocal about his bullishness on blockchain technology, said that he continues to be “very interested” in cryptocurrency and DLT-based companies, but further added that “we are close to a nuclear winter right now with cryptocurrency.”
Bitcoin, the largest cryptocurrency by market cap, is currently nearing its recently established 2018 lows of ,600 and is currently trading down 80% from its late-2017 highs of nearly ,000. Bitcoin’s poor market performance has led the altcoins markets into a downwards spiral that has sent many of their prices into territories not seen since early-to-mid 2017.
Related Reading: Mike Novogratz Expects Crypto Market Turnaround, Adoption in 2019
Not the First Cryptocurrency Winter
Breyer importantly added that the current crypto slump isn’t unprecedented, and these type of cyclical pricing patterns are seen in most emerging tech markets, including the artificial intelligence (AI) industry and the internet, which saw a major bubble form and burst in the late 90s and early-2000s
Breyer made a huge portion of his wealth by investing in nascent markets, as he placed a massive, and risky, bet on Facebook in 2005 when the company was in its infancy. Ultimately, this bet was worth billions of dollars and allowed Breyer to form his own investment firm, aptly named Breyer Capital, in 2013.
While speaking about the predictability of boom and bust cycles in nascent industries, Breyer noted that “these cycles keep happening every decade or so,” and further added that this type of seasonality is “inevitable.”
Furthermore, he also said that blockchain technology, which underpins cryptocurrencies, is being investigated and implemented by some of the biggest names in technology, with some of the best and brightest computer science minds devoting their knowledge and skill to advancing the technology.
“So many of the very best computer scientists and deep learning PhD students and post-docs are working on blockchain because they have so much fundamental interest in what blockchain can mean… You don’t want to bet against the best and brightest in the world.”
Featured image from Shutterstock.
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The Crypto Winter Is Here and We Only Have Ourselves to Blame
Last year’s mania perpetuated a narrative that making speculative gains was bitcoins core value proposition, writes Michael J. Casey.
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Winter Cometh: Bitcoin to Equal Four Year Record Dropping Four Months in a Row
Bitcoin has not fallen for four consecutive months and closed November in the red since 2014. As the world’s largest digital currency continues its downward spiral new records are being made, and they are not ones to revere in. It is on track to repeat a record not seen for four years.
Bitcoin Patterns Back to 2014
This milestone has been noted by Marketwatch which made the comparison in a report citing Dow Jones Market data. The four in a row began in August when Bitcoin dropped 8% over the month falling from around ,600 at the beginning to just below ,000 by month end. BTC then dropped below ,000 for the second time this year on August 14 and has fallen every month since.
According to the report the last time this happened was during the crypto winter of 2014. That year saw BTC dump over 70% when it tumbled from a high of ,130 in December to just over 0 by the end of December 2014. The pain did not stop there as the bear market continued deep into 2015 when Bitcoin dropped to a low of 3 in January according to Coinmarketcap.
This represented a fall of 84% from its all-time high. Bitcoin remained on the floor trading around 0 for most of 2015 before finally starting to head upwards in October.
Comparatively, Bitcoin has declined just over 80% this year since its ATH back in December 2017. Since August this year Bitcoin has fallen by half as it hit a new yearly low on Sunday when it dropped below ,600. Yesterday saw another two bounces off ,650 which appears to be a support level soon to break. This sentiment is being echoed by technical analysts that have been correct so far;
HIGHLY speculative, but…: pic.twitter.com/OeUSPcmRTN
— Murad Mahmudov
(@MustStopMurad) November 27, 2018
Analysts are now calling a ,000 bottom where Bitcoin will remain for several months and may not recover until the latter half of 2019. If the 2014-2015 crypto winter is to be repeated things may not improve until around October time when the bears may finally go into hibernation.
Things will go quiet on the crypto trading front, as they did four years ago, but the industry has grown monumentally since then and institutional players are now taking an interest. As crypto leaders, such as Binance boss CZ, likes to say; “Now is the time to Buidl”.
FUD wins in the short term, BUIDL wins in the long term. https://t.co/ikQDNQZI0G
— CZ Binance (@cz_binance) November 26, 2018
Bitcoin appears to be repeating a pattern last seen four years ago but the space is very different now. Either way it looks like the time to batten down the digital hatches and prepare for a long cold spell in crypto land.
Image from Shutterstock
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Blockstack CEO: Crypto Winter is Here But the Next Wave Will be Massive
Since the introduction of blockchain in 2008, there have been more than 80,000 digital ledger technology projects launched around the world. In 2016, a total of 29 crypto projects raised over billion via tokenized crowdfunding (ICO). The next year, 871 ICOs raised a whopping billion, causing a wave of investment into the blockchain space. And in 2018 – this year – over 800 ICOs have announced their blockchain products.
But a “crypto winter” may end up freezing a majority of them to death, believes Muneeb Ali.
Decline in Funding
The chief operating officer of Blockstack, a blockchain platform itself, said that funding into digital ledger startups had gone down. He indicated that due to a shocking majority of ICO projects failing to deliver a blockchain product, the confidence among investors has come to an all-time low. As a result, it could impact even good plans for meeting their funding goals.
“No need to deny or downplay it. Funding will likely dry up, we might start seeing projects shut down,” tweeted Ali.
2018 has been one of the worst years for the cryptocurrency market. Almost every crypto-asset has posted humongous losses which include top coins like Bitcoin, Ethereum and Ripple. The market blames the ICO projects for the damages, stating that ICOs accumulated the leading cryptocurrencies from investors to develop their blockchain platforms. But, in the end, a majority of them failed to deliver the product, or just fell behind their promised roadmap. In the meantime, they kept dumping the accumulated crypto funds for fiat money, increasing supply against a weaker demand.
The death of many blockchain projects could be good news for the crypto market in the long run, Ali said.
The Blockstack executive said that the current phase of the crypto market is similar to the “dial-up era” of the internet. There was a substantial likelihood of failures, impractical ideas, and hype-driven investment which – now – is on its way down as the funding declines. Investors are becoming smarter, and would likely put their capital in projects that are well-backed and driven from practicalities of the blockchain.
A New Beginning
It can be confirmed by comparing the total number of blockchain ICOs launched this year and how many among them met their funding goals. Cryptocurrency data firm ICORating found that funding into blockchain startups raised from .3 billion to .5 billion between first and second fiscal quarters. Even then, only a small number of ICOs were able to raise funds, while the rest of them were abject failures.
It proved that investors continued to believe in the potential of blockchain technology, but they trusted only a few teams with its development.
“It’s far from the end, however. The next wave can reach a bigger market, beyond this “dial-up era” of crypto,” stated Ali.
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Crypto Winter or Spring Revival? Take CoinDesk’s State of Blockchain Survey
A return to normal, rules on the rise, and did you pay the tax, man? Let us know in our latest industry survey.
CoinDesk
Top 5 Winter Bitcoin and Blockchain Conferences
Winter holidays are incoming, everybody can take a rest with family and friends and, after that, plunge headlong into the amazing world of cryptocurrency and blockchain technology. It can bring you money, success and improve your business. Can we call blockchain the Santa Claus of 21st century Obviously, yes! Where can we see him At the Top 5 Winter Bitcoin and Blockchain Conferences! 1. London Blockchain Week 2018 London,UK &8211 January 19-26,2018 &8211 More thannRead MorenThe post Top
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