Facebook’s Project Libra Will Change Cryptocurrency Industry Forever

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Since Facebook revealed its new project Libra, and everything that is related to it, people are starting to wake up and speculate – Is Facebook’s Project Libra going to take over the cryptocurrency industry? Such a company which has billions of daily users simply couldn’t not leave a mark. Whether it will be a good or a bad mark, let’s see.

As we reported earlier, Facebook announced the white-paper of their ever long speculated crypto project – Libra. Along with Libra came the Libra Association, Libra Reserve, and Calibra. Calibra will first serve as the digital wallet where users can store their Libra’s and exchange with each other. Libra Association will govern this app, and eventually, Calibra is meant to develop financial services and products around the Libra Network. The Libra association consists of 28 large corporations and companies which specialize in wide range of industries coming from blockchain and finance ranging to entertainment and telecom companies.

After these news struck the cryptocurrency ecosystem, people are starting to ask questions, whether Facebook could disrupt the crypto industry as a whole?

Facebook Completely Misunderstands Money

As Caitlin Long, the member of Wyoming Blockchain Task Force, also known as the crypto Mom, yesterday described in her first Project Libra analysis:

“Facebook completely misunderstands money. Facebook understands payment systems – but that’s not the same as money. Two telling quotes: “Libra is backed by a reserve of real assets.”; “Many cryptocurrencies today (eg #Bitcoin & #Ether have no underlying assets to back them.” Money is a good that serves as an HONEST LEDGER – it doesn’t need to have intrinsic value because it attains value by people trusting it to be an HONEST LEDGER.”

She points out that just because Facebook is backed by many different assets, doesn’t mean that people will give the currency value. She believes that Facebook has widened the conversation on what money really is.

“Libra is the first denationalized “money” that billions of people in the world will encounter […] billions of people will soon become woke to the unfairness and instability of current monetary and payment systems,” writes Caitlin in her Twitter profile adding: “People are smart – they will figure out Libra isn’t scarce and will migrate to bitcoin and other crypto over time,” she predicts.

Libra Will Educate More Users

Because of yesterday, millions, if not billions, of people realized that cryptocurrencies are a real thing because up until now, all they had heard about crypto or Bitcoin was that it is a speculative and very volatile market without any future or actual use case. Now when the man himself – Mark Zuckerberg makes a Facebook post about a cryptocurrency that Facebook is developing… I mean, I fully believe that yesterday alone made more people aware than the last years in crypto combined.

The fact that a company of such scale and authority recognizes crypto as a asset class, that has a use case, is huge! And I tend to agree with Caitlin. The time frame could be 5 years what we are looking for, but eventually people will start looking into other crypto’s. I mean, as soon as project Libra will lack in something, there will always be hundreds of cryptocurrencies that will do it better. And you know – once you start fooling around with sh… I mean Altcoins, you eventually find Bitcoin and stick to it. Of course, everything won’t go as smooth as I just described and it most definitely won’t happen anytime soon, but it could be a pattern. Most importantly, if Libra or Facebook is talking about third-world countries where people are struggling to even pay the transaction fee, then once they take the bite by Facebook, they will realize that because of crypto there can be even less fees or even a fee-less system.

But all-in-all, Facebook has done a really great job in terms of courage of taking the first step. It could’ve been Google, or any other company, but Facebook took the first bite and takes on the mission to educate billions of people. These might not be intentional lessons on what crypto is, but still, this will do just as fine.

Source:

https://www.forbes.com/sites/panosmourdoukoutas/2019/06/18/facebook-could-change-the-game-for-bitcoin-eth-xrp-and-litecoin/#353a3b96737a

What will be the Spotify of crypto? #ripico #sto #ntut

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The cryptocurrency market just experienced a small break-out and it almost seems like we all are profiting again. However, it has become virtually impossible for any ICO to (1) attract a decent amount of funding, (2) maintain token price within reasonable value, (3) return the money to the investors, (4) produce any of the blockchain ecosystems promised or (5) make any money at all.

“I therefore declare ICO as dead and buried forever. But it is not the end.”

A new wave is coming. STO (Security Token Offering) is taking the lead in being the most appealing alternative way of fundraising for 2019. In a nutshell is the ability to issue tokens backed by real value. Too many “pitchers” in 2017 and 2018, promised an ICO token that would have appreciated in value for the mere reason that it was scarce (as in limited issuance). Wrong. A million times wrong. Because unlimited ICO multiplied by limited tokens, still makes unlimited token supply as a result, as long as the herd kept producing tokens on ERC20 and list them on an exchange.


I foresee the renaissance being based on 2 ecosystems and 2 tokens.

1.

The first ecosystem will be common to all projects and all trades: a pure financial ecosystem fuelled by Security Tokens (ST). No hidden agenda. Purely for the purpose of making money. Too many times, from the stage of yet another blockchain conference, the CEO of the next big wannabe ICO has promised an ecosystem with a real utility use case. Too bad that token buyers only bought the stinky tokens hoping to go to the moon with their Lamborghini, in the same fake fashioned way Tesla pretended to send one of their cars in outer space. This Financial Ecosystem is only designed to make money.

2.

The second ecosystem depends on the trade. It could be a Lifestyle Ecosystem for a gaming company (one of those who doesn’t have a Problem/Solution slide, but makes ways more money that those who want to “save the world with blockchain technology”). A project aiming to tokenize real estate could, for instance, create an Education Ecosystem, sharing tips and secrets of the trade. A company aiming to tokenize a portfolio of wealth management could create a Financial Networking Ecosystem. The options for naming here are endless. Whatever is the name assigned to this ecosystem, there will be a Non-Tradable Utility Token (NTUT) that can never ever in its lifetime be exchanged for fiat currency or any other crypto/token/coin or whatever. So it is basically useless unless you use it in the ecosystem.

For example, if you are running a gambling project, for every time your user wins/loses more than a certain amount of dollars on your platform, you give them a load of NTUTs, which can only be exchanged to customize the look of the chips, but never to be exchanged for chips. Or, if you are tokenizing real estate, you could use NTUT to access premium content in an educational directory. And if your ecosystem does not have a way to reward users with value, then it would be great to connect with third-party partners able to do so. For example, a telco could offer 1Gb of data as a way to connect with new potential clients.

I believe that the industry is not dead. Only the format. The death of vinyl discs and music cassettes did not kill the music industry, but rather introduced new ways of playing songs with CDs, DVDs, then MP3 and currently Spotify. What will be the Spotify equivalent in this industry? Nobody knows yet.


Stefano Virgilli, CEO at VOX.sg

www.bit.ly/stefanovirgilli

How blockchain could disrupt passports and immigration

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The oldest piece of technology that everyone carries around for a lifetime is indeed the Passport. There is nothing in my opinion more obsolete than a piece of paper with stamps on it meant to track the places that we have visited. In my wildest guess, I would not be surprised if in 10 years from now we could be actually laughing at the idea of carrying around our passport country by country.

Blockchain could once again be the solution. It is not a mystery that I believe in blockchain being the greatest innovation opportunity of our times. The concept is so simple and yet so misunderstood by the most, that occasionally I catch myself commenting:

“People do not need to understand how blockchain works, they just need to use it.”

And for as radical it might sound, it is actually quite acceptable in pretty much any other aspect of our life.

Less than 1% of the world population knows how to program an app for a smartphone, and yet such innovation has taken the world by storm. In extreme terms, everybody has one or more cell phones in their pockets, and yet nobody knows how it works at its core. The same goes for computers of course. And by larger definition, let us think for a moment about the stock market or insurance policies. Do we really know what a hedge fund is? Do we totally be 100% confident about understanding every single clause of our insurance? Even further? Do we need to be able to cable or plumb our house before we move in? Of course, some people do, but for an innovation to succeed on a large scale, adoption is far more important than understanding.

Blockchain has been seen fully implemented over the past nine years almost exclusively with regards to cryptocurrency, and because of the word “crypto”, it ended up sounding scary ever since day one. However, the potential implementation of blockchain in other parts of our life makes it so promising that it is hardly imaginable how could it fail.

Given the idea of a shared ledger, blockchain will in future allow health records to be tracked globally for everyone. So if John Smith has a car accident while on holiday in Thailand, the doctors would immediately be able to track any allergy to medication even when the patient is unconscious. In our super modern society and with all the most advanced technologies that we hear about, isn’t it so primitive that doctors need to ask their patients whether or not they have any medication allergy? Blockchain could answer the question for everyone at any point in time.

Back to the main topic of passports, if we look at the issue from square one, we understand that the only reason why a country would ask any visitor for passport identification is to track entry and exit to avoid overstay. In other words, we need to track date one as entry and date two as the exit. There are also some small variables of course, such as visa extensions, reasons for visiting etcetera, but let us keep it simple for a start.

A country would not want to have overstay of foreign citizens that are inclined to crime and create harm to society. This can also be prevented by blockchain. In simple terms, a country’s custom wants to check whether a visitor has any criminal records in any other country. This is virtually impossible with paper passports, despite the deeply integrated international systems, but if we were to adopt blockchain as the main mean of transferring data fully, we could be able to find all the answers in a second. In fact, all criminal behaviors and arrests could be tracked by local police officers and validated block by block by other police authorities or simple citizens.

I imagine the blockchain requiring a parallel internet to run the profile of every single person in the world, that at will can disclose which relevant part of their lives can be exposed. On Facebook, we can all be happy, honest and successful, but on the blockchain, nobody could lie.

For example, citizens could publish in the public ledger their income statements and make it accessible on demand to the requesting institutions. Banks could clear the person’s credit in a snap while embassies could cross-examine the account balance without asking the visitor to present a bank statement. Everything could be transparent at will, and most importantly fast and secure.

I imagine a world where every citizen could travel from country to country without a passport, by carrying only their footprint on the blockchain as a form of identification.

Stefano Virgilli

TEDx Speaker, Marketing Blockchain & ICO, Singapore PR

Title photo by: Himesh Kumar Behera

How To Trade Cryptocurrencies?

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How do I start trading cryptocurrencies? How to make the first trade? I believe those are one of the most asked questions in the past two years. First of all, it is considered very speculative to trade cryptocurrencies. It is very volatile and that is the main reason why many traders are jumping in on board with crypto trading. If you follow your strategy and discipline yourself, you’re bound to have good profits. Here is a list of a few advices how to start planning your strategy, what to focus on, and, eventually, become more disciplined. 

Don’t follow the hype

As we experienced previously most of the massively hyped projects in crypto are now down almost 98% since their peak prices. These type of investments are mostly based on the hype that the community generates. Be smart. The saying “buy the rumor sell the news” is there for a reason.

Top Losers from ATH. Source: onchainfx.com

Take small profits, don’t be greedy

It’s much better to take small profits like +2% or even +1% in the long term. Don’t be greedy, trade cryptocurrencies with ease, and don’t expect your investments to rise more than +10% to +50%. It will most likely never happen again in crypto. For daily stock traders, there is a “1% risk rule”. This keeps your capital losses to a minimum and avoids harsh market conditions. You can achieve this by using targets and stop-loss orders. The provisional idea is that if you take a 1% profit on every trade you make after a year you can grow your capital by +365%. Think long term, not short.

Follow your gut/heart

Most of the times, you kind of feel when the market is starting to switch directions. Again – don’t be greedy and do what you think is best for you. If you have a feeling, based on your experience and knowledge – follow it. It is better to take profits on +1% – +2%, than rather loosing -10%, or even everything on your trades or investments. Most beginner traders have this feeling that I won’t get this chance anymore, so I have to use it 100%. That is false. The market is constantly evolving and more projects and institutions are coming in, so don’t worry about your single trade.

Cash out everything to fiat

While some experts say that Bitcoin mass-adoption is a 50-year long-term plan, it is highly unlikely that the broader society will switch to only Bitcoin or even cryptocurrencies in general. At the moment, and for a couple of years from now on, fiat will be the main form of money and as they say “a bird in hand is better than two in the bush”. I’ve heard stories from many investors, that they cashed out everything to fiat when the bull-run started to emerge. They took all the profits when Bitcoin was at $9000 – $10,000. Of course, they could’ve profited more, but how do you think – are they regretting something at this point?

Educate yourself constantly

There is nothing more valuable than education. It won’t do any harm to you or your investments, only good. You have to stay up to date. Learn about cryptocurrency trading. Learn more about the industry that you have invested in, and know every little detail. It will grow your confidence in regards to your trades or investments.

Do Your Own Research

This binds with the first advice – don’t follow the hype. You have to research the assets you are willing to invest in by only yourself. At this time, when social marketing and the internet, in general, is constantly evolving, you have to understand, that nobody will share valuable information for free.

Further, this also applies to your gut and nerves. You will feel constant anxiety in those cases when you follow a different opinion rather than yours. On the other side, when you build your investments only based on your own knowledge, you will feel more safe, and secure about your decisions. Trade your cryptocurrencies with knowledge!

Never invest money that you can’t afford to lose

There are countless stories of people investing their life savings, mortgaging properties, applying for loans, and in general, investing more money that they can afford. These actions are at very high risk, and almost never pays off. Again – it is better for everyone around you if you trade cryptocurrencies with only the amount that you can afford to lose. Even if that is only $10, you will feel more calm and balanced. Because at the end of the day – these are investments, which are meant to improve your life, not destroy it. Crypto investing is unique in its base – you can invest small amounts in almost every kind of a project. Crypto investments of as little as $7 dollars can gain you multiple thousands in return. And it is definitely better to lose $7 dollars rather than $700.

“Be happy about what you have, not what you could’ve had!”

However, this is not financial advice. I don’t have a financial degree. This summary is only based on my and my friends experience. Do your own research and don’t base your opinion on somebody else. And most importantly – educate yourself! 

Photo by rawpixel.com from Pexels

STO vs. ICO

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STO (Security Token Offering) is a token offering that is similar to an ICO (Initial Coin Offering), but the main difference is that STOs are regulated. STOs have become so popular because over the past four years, approximately, pretty much every ICO failed to maintain at least one of the five promises that I call success criteria. 

1. Most ICOs failed to attract enough investment.

2. The majority of ICOs failed to maintain a stable price of the coin or to increase the value of the coin, and so it dropped dramatically.

3. Some of ICOs failed to return the money to the investors.

4. Many ICOs failed to be able to produce the software technology or the ecosystem that they were promising during fundraising.

5. Almost all of them eventually failed to be profitable.

If you take into consideration all the success criteria, in four years, I would bet that no ICO has ever managed to achieve the five points altogether. That is the reason why the STO hope is given a more stringent requirement in the fundraising and backing the value of the token with physical assets, shares or profits could increase the likelihood of success.

ICOs

The crude reality of ICO is that basically the fundraising exercise was simply designed to sell tokens (as borderline securities) to non-qualified investors, without a license to do so. That was all that ICO was about. Basically, those startups that fail to connect with venture capitalists started looking in other directions, i.e. the community. When the community worked, it was because the value of Ethereum was growing so dramatically that it transformed ordinary citizens into millionaires. They were happy to make investments in companies when they didn’t understand exactly how they would have made money.

However, when the community failed to back most projects and when the cryptocurrency stopped growing, startups went back to venture capitals and funds, asking them to invest in their ICO or startup. That is because eventually, even until today, whoever is running an ICO still wants to have an investor, a large investor precisely, to come in and gobble up as many tokens as possible.

Startups

Startups have always been looking for investors for the purpose of growing and developing business. And those that are currently planning to launch an STO understand that ICO is finished, despite the fact that going with STO will require much more regulation. But in terms of costs, it will probably be similar to ICO. Because running an ICO is very expensive from a marketing perspective, while running an STO could be quite expensive from a regulatory perspective, the cost might be comparable in the end.

For those who are doing an STO, it is crucial to take a close look at the current and future regulations. Startuppers should be guided by professional lawyers, accountants, and advisors. It is no longer a ‘cowboy’ type of market where anyone can launch an ICO and attract the community to invest in their projects. Nowadays, it is back to the ‘big boys’ market. So everyone will need a lawyer, a banker, tax advisors, and compliance advisors to explain to them what they need to do in order to be compliant and to stand a chance of success in fundraising through an STO.

What will happen in the future?

After all, STO sounds like the new thing to do, it might go out of fashion quite quickly, probably by March or June 2019. They will start slowing down, and then by September, it could be completely out of fashion. I would compare ICO to vinyl discs, and STO to music cassettes. After the music cassettes, there were CDs and DVDs then the MP3, then Spotify.

We don’t know yet what will come next yet. The industry is still the same, it was music then, and now, similarly, the medium that is used for fundraising has changed and will further evolve, as in the current transition between ICO and STO.

The next transition will be between STO and something else. My current prediction is that there will be fundraising with two ecosystems. One is for fundraising (a financial ecosystem) and the other one for onboarding community, like a point system, and I call it a lifestyle ecosystem, fueled by NTUTs or non-tradable utility tokens. I think this is going to be the next big trend. It is a token that can never be exchanged on an exchange for monetary value but just used as a pure utility to onboard new potential STO investors.

Photo by rawpixel.com from Pexels

WARNING! Don’t even think about crypto investments until you read this!

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I remember it like it was only yesterday when all the coins and tokens were booming and you could get massive gains in every crypto asset you invested. It was the crypto investments bull run of 2017. It all looked so easy and it almost felt like this could go on forever. But it was just a big bluff since I and my friends weren’t with a financial background, and only got into cryptocurrencies in May 2017.

The first crypto investments – Bitcoin and altcoins.

Me and my friends started talking about cryptocurrencies in early May 2017. My ex-girlfriend had been talking about this thing called Bitcoin and I started reciting it to my friends. The more I talked about it, the more I understood it in the sense of a great investment opportunity. It was the time when Bitcoin was around $1,200. I told them that it is a new form of money, only fully decentralized, with no one able to shut it down or take full control of it. That it is a great opportunity to invest because ever since it is created, it has seen only a rising pattern (at least that’s what I thought back then).

It seems like I was very persuasive and they really understood my arguments, because the next time I saw my friends, they had already registered in this thing called “Poloniex”. At that time, as I already mentioned, neither of my friends had any economic or financial background. I didn’t even know that there are such things as exchanges, hence Poloniex.

The first trades

So we put our heads together and started looking at all the assets, charts, prices. Everything seemed like out of this world, and needless to say, we didn’t understand anything. My friends bought a little portion of Steem (STEEM), Ripple (XRP), Stratis (STRAT), Litecoin (LTC), Siacoin (SC), Folding Coin (FLDC) (I know, right?) and Dash (DASH). Why we invested in those particular assets, I have no clue. It just seemed like the way to do. My friend, who found out about Poloniex kind of lead me into this. However, when we sat down, and he showed me how everything works, and at first I bought into Ripple. But I kind of didn’t believe Poloniex, I switched to Bittrex. Later that paid off.

Trading history of my friends first trades

The first profits

As you can see in the picture, my friend quickly got to know how trading works. So very early in the game, he picked the first “fruit” in the form of crypto profits. At that time the total market cap was around $80 billion and Bitcoin’s price was a little over $2,2k. Of course, we had no idea that it was forming onto the biggest bull run in crypto history.

However, I kind of didn’t believe altcoins at first. Mostly because I didn’t have such high profits as my friend. Since I knew a lot about Bitcoin (a lot at that time, enough to understand that it was the first cryptocurrency), I invested in Bitcoin.

Of course, when I later saw how my friend was making even more money from altcoins, I started investing in them as well. Little by little, we got to know the secrets behind crypto trading. We found coinmarketcap.com, and similar websites where we could at least read about what we were investing in. We began buying more and more coins, based on what those companies were promising to their investors.

Investing in Initial Coin Offerings (ICOs)

Since I didn’t have much luck in trading altcoins, I stopped doing that and sort of was educating myself about cryptocurrencies. I watched my friends investing in them daily, we talked about their crypto investments and later on, I researched them. In some I believed, in some not as much, but basically, I was accumulating more Bitcoins.

Later our discussions changed as they started talking about this thing called ICOs. They said that it is so easy to gain x10 profits and even more. You just have to use MyEtherWallet, buy some Ethereum and look for most popular ICOs. It all sounded too easy. However, they got huge profits out of these crypto investments. But those profits were crypto-wise, not fiat-wise. Later on, they had invested in more than 20 ICOs and the flat where they resided almost started to look like a full-time office. To me, it all looked so sketchy. I just sat behind and observed their success.

The biggest Bull Run in crypto history

After a couple of months, in late 2017, they were almost like professional crypto investors. They used all the opportunities that crypto handed over to them. They signed up for countless Airdrops, used Steemit to accumulate more crypto and with profits gained from steemit they invested in more crypto projects and ICOs. At that time, day by day crypto assets were rising at unbelievable measures and it seemed like you could invest in almost everything. They went from a couple of thousands to a couple of tens of thousands. I remember my friends 28th birthday when he said that now he has up to $28k in profits. We talked about what he could do with that kind of money and how his life could change, but eventually, he didn’t cash out. Now it seems like the biggest mistake, but as we say – you only learn from your own mistakes.

From $0 to $40,000

My other friend, on the other hand, didn’t have any funds to invest with, so he used Steemit to raise his capital. Now looking at what he did, it almost seems unbelievable, because he went from $0 to approximately $40,000. You could say that they got really lucky with the projects that they chose. Of course, they also invested in a few scam projects and lost their money, but that is not even comparable to what they had gained. At one point they profited more than $1k a day, so they came up with a plan: $100,000 challenge.

Considering the number of profits, it is needless to say that we, people with no financial or economic background, talked a lot about how we would spend this money and basically, we were shocked but very satisfied at the same time with our ongoings. All the provisional ideas, what if, and when that will boom to this amount was an everyday part of the discussion.
They invested very early is projects like Antshares (now NEO), Bitquence (now Ethos), Dent, and Substratum. $20 turned into $2,000. To me, they seemed like absolute crypto-guru’s.

Me on the other hand, I hadn’t invested in any ICOs at that time, because all the “MyEtherWallet”, “Gas”, “decimals”, and overall – “sending my money to some kind of a project which promised a revolution in the world” seemed a little bit odd.

“Money that comes easily disappears quickly”

Just recently I approached him to ask how he’s doing. It’s not like we don’t communicate since the bear market started, but the discussions about crypto have decreased to a minimum. Mostly it’s because the last drop in the sea for him was the hack of his Ether wallet. He lost most of his funds and investments. His biggest mistake was that he held all those assets in one wallet and was not cautious enough about the security. When I asked whether he plans to invest further in the future, he was positive. And that is understandable because the bear market kind of makes you think about your past decisions. I couldn’t leave without an interview, so I asked him to comment on what he would have done differently and a few words about his experience and future advice:

“Money that comes easily, disappears quickly. I have no idea what would have I done differently. It’s hard to say what would you do if you had another chance. I would have definitely cashed out. It’s like I thought that I will earn a lot of money, but you have to work hard for a lot of money and you have to understand what are you doing. You have to take profits. I didn’t have any education. The amount of money I had profited completely made me blind. We did almost anything that crypto offered, we tried this, then that, all in a row. I remember that time as some kind of euphoria, it didn’t seem like it would end at all. It seemed that real-world crypto adoption will happen instantaneously. To me, it felt like I needed to get as many coins as I could.”

Good or bad experience?

So I asked whether crypto did more good or bad to his life since he carried such a harsh story on his shoulders. He replied completely positively. No regrets is his motto of that day since he learned so much about many different industries, mostly economics, finance, money and things related to that.

“My main mistake was that I didn’t accumulate more Bitcoins. Every day I had that feeling that I needed to get more bitcoin, but I didn’t. I bought more and more altcoins. The fact that I didn’t cash out, basically means nothing, I needed to accumulate more bitcoin. Everybody told me and I read a lot that your portfolio is based on Bitcoin. So yeah, if I regret something then this is that. But the amount of knowledge I gained from crypto is unbelievable. I learned so much!”

It turns out that before he got hacked, he had more than 50 different assets. Now that’s hoarding!

Advice for the next bull run

Don’t follow the hype

As we experienced previously most of the massively hyped projects in crypto are now down almost 98% since their peak prices. These type of investments are mostly based on the hype that the community generates. Be smart. The saying “buy the rumor sell the news” is there for a reason.

The biggest losers from ATH. Source: onchainfx.com

Take small profits, don’t be greedy

It’s much better to take small profits like +2% or even +1% in the long term. Don’t be greedy, and don’t expect your investments to rise more than +10% to +50%. It will most likely never happen again in crypto. For daily stock traders, there is a “1% risk rule”. This keeps your capital losses to a minimum and avoids harsh market conditions. You can achieve this by using targets and stop-loss orders. The provisional idea is that if you take a 1% profit on every trade you make after a year you can grow your capital by +365%. Think long term, not short.

Follow your gut/heart

Most of the times, you kind of feel when the market is starting to switch directions. Again – don’t be greedy and do what you think is best for you. If you have a feeling, based on your experience and knowledge – follow it. It is better to take profits on +1% – +2%, than rather loosing -10%, or even everything on your trades or investments. Most beginner traders have this feeling that I won’t get this chance anymore, so I have to use it 100%. That is false. The market is constantly evolving and more projects and institutions are coming in, so don’t worry about your single trade.

Cash out everything to fiat

While some experts say that Bitcoin mass-adoption is a 50-year long-term plan, it is highly unlikely that the broader society will switch to only Bitcoin or even cryptocurrencies in general. At the moment, and for a couple of years from now on, fiat will be the main form of money and as they say “a bird in hand is better than two in the bush”. I’ve heard stories from many investors, that they cashed out everything to fiat when the bull-run started to emerge. They took all the profits when Bitcoin was at $9000 – $10,000. Of course, they could’ve profited more, but how do you think – are they regretting something at this point?

Educate yourself constantly

There is nothing more valuable than education. It won’t do no harm to you or your investments, only good. You have to stay up to date. Learn more about the industry that you have invested in, and know every little detail. It will grow your confidence in regards to your trades or investments.

Do your own research

This binds with the first advice – don’t follow the hype. You have to research the assets you are willing to invest in by only yourself. At this time, when social marketing and the internet, in general, is constantly evolving, you have to understand, that nobody will share valuable information for free.

Further, this also applies to your gut and nerves. You will feel constant anxiety in those cases when you follow a different opinion rather than yours. On the other side, when you build your investments only based on your own knowledge, you will feel more safe, and secure about your decisions.

Never invest money that you can’t afford to lose

There are countless stories of people investing their life savings, mortgaging properties, applying for loans, and in general, investing more money that they can afford. These actions are at very high risk, and almost never pays off. Again – it is better for everyone around you if you invest only the amount that you can afford to lose. Even if that is only $10, you will feel more calm and balanced. Because at the end of the day – these are investments, which are meant to improve your life, not destroy it. Crypto investing is unique in its base – you can invest small amounts in almost every kind of a project. As you saw in the pictures above – crypto investments of as little as $7 dollars can gain you multiple thousands in return. And it is definitely better to lose $7 dollars rather than $700.

“Be happy about what you have, not what you could’ve had!”

However, this is not financial advice. I don’t have a financial degree. This summary is only based on my and my friends experience. Do you own research and don’t base your opinion on somebody else. And most importantly – educate yourself! 

Photo by Chris Liverani on Unsplash

What is Bitcoin (BTC)? A beginners guide.

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First and foremost, the definition says that Bitcoin is a peer-to-peer (P2P) electronic cash system, as described in the white-paper. It was first published on October 31st, 2008 by Satoshi Nakamoto. In January 3rd, 2009 the first block was mined which marked the actual creation of Bitcoin. 

The abstract of Bitcoin white-paper.

Bitcoin along with Satoshi Nakamoto presented an entirely new alternative to the traditionally centralized currency transactions. A system built by the people for the people. So the primary intent is that people are the ones, who control it. Bitcoin enables people to transact money between users without the need of a centralized authority. Because of blockchain technology, Bitcoin can offer a completely transparent way to transact payments. This system can entirely question the need or importance of Banks and other similar money transfer institutions.

Also, Bitcoin was the very first cryptocurrency in the form as we know them today. Bitcoin inspired thousands of new projects, as of today we have more than two thousand cryptocurrencies in the whole wide world. Since bitcoin code is open-source, everyone can copy it and try to evolve it in their own way. That is the reason why we have so many other “Bitcoins” in the market. Everyone wants to prove that they can make a better Bitcoin, but the cold hard facts are that Bitcoin, since its creation, has never lost its #1 position. Ever. And it is very doubtable that it ever will.

Other Bitcoins. Source: coingecko.com

In addition, Bitcoin has a fixed supply of 21 million BTC. Currently, there are 17,4 million coins in circulation.

How Bitcoin Works

Bitcoins are transferred via a peer-to-peer network. That means John can easily send money to Kate via this network. When John makes the transaction, miners create new blocks where this transaction will be recorded. By doing so, miners confirm this transaction. These transactions are tracked on the Blockchain, also known as the giant-ledger.

The Blockchain

Blockchain records every single transaction that has ever been made within the network. Bitcoin blockchain produces new blocks every ten minutes. Every block in the blockchain is built up of a data structure. If a single file is corrupt in a chain, then blockchain prevents it from damaging the rest of the ledger.

Source: https://www.g2crowd.com/categories/blockchain

Confirmation

So when John makes the transaction, it goes into the blockchain and now is waiting for confirmation. Usually, for small payments, it takes these ten minutes to be verified and recorded on the chain. For larger transactions, it could take up to even an hour when the blockchain needs to create at least six new blocks to avoid payment reversing. After the confirmation, Kate receives her Bitcoins.

When looking at a government which can print out as many bank notes as they want, thus producing inflation, Bitcoin works differently. That is, Bitcoin’s blockchain is built up in a way that it controls how many Bitcoins are made and how many are being produced.

Block halving

Bitcoins blockchain has a 4 year block halving period. That means that every four years, or 210,000 blocks, the reward for miners, who produce Bitcoins with their computing power, halves. Miners produce new blocks every 10 minutes. At the moment, for every block that a miner solves the reward is 12.5 BTC. Currently, there are 70,250 blocks left until the mining reward is halved. Also, there are only 2 block halvings left to occur in the future of Bitcoin. Respectively the reward will halve down to 6.25 Bitcoins. In the next block halving, which would occur in 2024, the reward will divide down to 3,125 and stay that way until all 21,000,000 BTC will be produced.

Bitcoin’s key features

Bitcoin is decentralized. No single person or a central authority has full control over it. That means no one can freeze, lock or dismiss your money. It is based on a Blockchain. It was the first blockchain ever created and since then the development of this area has skyrocketed. Blockchain developers today are the most demanding job position in the world.

Bitcoin has a limited supply. There can only be 21,000,000 BTC in circulation. Today we have around 17,496,875 BTC in circulation. In other words, around 80% of Bitcoins have already been mined. According to estimates, bitcoin will reach its final coin figure sometime in 2140.

Bitcoin compared to Gold and U.S. monetary base. Source: https://www.forbes.com/sites/laurashin/2016/06/02/4-reasons-why-bitcoin-represents-a-new-asset-class/#4731f35d3426

Bitcoin is deflationary. Some believe that Satoshi created Bitcoin to fight the money printing governments. It is awful that every year fiat money loses so much value. For example, during Fiscal Year 2014, the Bureau of Engraving and Printing delivered approximately 6.6 billion notes to the Federal Reserve, producing approximately 24.8 million notes a day with a face value of approximately $560 million.

Ron Paul described this very well in his website, calling the Fed crazy:

“When central banks create money, those who first get the new money enjoy an increase in purchasing power before the new money causes a real increase in prices. Those who receive the money first are members of the banking and financial elite. By the time the new money reaches the middle class and working class, inflation has set in, so any gain in purchasing power is more than offset by the increase in inflation. Thus, central banking causes income inequality.”

Ron Paul

Bitcoin, on the other hand, as already mentioned, has a fixed supply. And this is the model that Bitcoin Maximalists are defending. For most people, this would seem like a utopian dream, but bear this in mind.

Imagine a society, a world, where your money not only retains its value but increases with time. Bitcoin possibly can provide this. Once reaching the total supply of 21 million, its value can only go up.

The best performing asset of all time

Anthony Pompliano called Bitcoin the best performing asset of all time for a reason. Since the creation of Bitcoin in 2009, it outperformed S&P 500, DOW JONES, NASDAQ, etc. “during the longest bull run”. Bitcoin experienced multiple declines with more than -80%.

Nevertheless, Bitcoin is still up +56,146.22% since its creation. Because when Bitcoin started, it was worth 0$. At the time of writing the price of one Bitcoin is $3,523.20.

Who created Bitcoin?

Ten years ago the Bitcoin white-paper, also called as “Bitcoin: A Peer-to-Peer Electronic Cash System” was first published. It was posted by an anonymous pseudonym Satoshi Nakamoto on October 31st, 2008. To this day people are still exchanging opinions on what, who or they are. Some speculate that he could be Japanese because of the Japanese-like pseudonym. Some say that he might be British because of his perfect English writing style in his posts. Also, people believe that that might be a group of people rather than just one. Nevertheless, there have been multiple people claiming that they are the real Satoshi Nakamoto. Also, many journalists have tried to find out who the mysterious creator of Bitcoin is, but all evidence is circumstantial.

The advantages of investing in Bitcoin

Bitcoin along with cryptocurrencies as an asset class, opened the possibilities for lots of people to start learning about investments. Before then, millennials and other people interested in investing knew about investment opportunities such as:

Shares or Equities

A share or a stock is an indivisible unit of capital, expressing the ownership relationship between the company and the shareholder. Basically, this is a small portion of a company. You can only buy them as a whole, hence the indivisibility. Your shares are entirely dependent on the company and the wellness of their business.

Bonds

Bonds are also known as fixed-interest stocks. These are a form of IOU (abbreviated from the phrase “I owe you”) issued by governments and companies when they want to borrow money from investors. They pay a fixed level of interest, with higher-risk borrowers paying more in interest than lower-risk borrowers.

Commodities

Commodities such as Gold and Silver is one of the best investment opportunities of all time. There is a huge variety of commodities in the global markets. It includes Oil and Gas, Copper, Iron and even such agricultural commodities as wheat, rice, soya, lumber and so on. Similar to shares and bonds, commodity prices rise and fall depending on the supply and demand, and funds can take advantage of this.

Real-Estate

Property as an asset class is also considered as one of the best investment types in the world. If you buy land or a house, there are multiple Return of Investment opportunities. You can develop it and almost in all cases, the price will rise. Whether residential or commercial, the property has a good record in providing a financial return that beats inflation.

Investor as a slave

All these asset classes till now made the investor a sort of a slave to the specific asset class. A Broker takes care of everything. He also charges a fee for his work, which is logical. Considering this, people just handed over their money to people who they didn’t know. This makes the investor almost a slave to the particular service which provides the brokerage. Also, the investor needed to know everything about the particular market. This requires many hours of reading and understanding, especially, if we look at markets such as Commodities or Real-Estate.

Also, it required huge amounts of money to start with, and up until now investing seemed like only for the rich. For example, if you wanted to invest in stocks, you couldn’t just buy a portion of a stock, like a 0,2 part of the stock. You needed to buy one whole stock. If you wanted to invest in real estate, you basically needed the money to purchase a house or land. And those are not cheap.

However, Bitcoin introduced a whole different type of investing. It is possible to buy the smallest portion of BTC you need. People don’t have to buy a whole unit. You even can buy Bitcoin worth of $10. Or even less, if you want. People always say Bitcoin has a scaling problem, but it doesn’t. Bitcoin can be divisible into small fractions like 0.00000001 BTC, called Satoshis. 1 Satoshi is the smallest unit of Bitcoin.
Also, you don’t need a broker to do the purchasing for you. You just need to read a few beginners guides, and you’re all set. Not to mention that when investing in Bitcoin you are the core holder and owner of your investment. Of course, if you don’t use any third-party services.

The disadvantages of investing in Bitcoin

Bitcoin has been and still is a very volatile asset. It still is looking for a more stable market so we wouldn’t recommend it for short-term investments. However, lately, we can see that the BTC market is starting to mature. In the chart below you can see the weekly volatility compared to other asset classes. Bitcoin’s weekly volatility is only a percent higher than Oil.

In comparison Bitcoin’s market cap at the time of writing is only $62,4 billion compared to S&P 500’s $21.03 Trillion, or Dow Jones Industrial Average (DJIA) $7.5 trillion. You can only imagine how stable Bitcoin would be if it had a market cap of that scale.

Also, Bitcoin does not come with an insurance policy, like all the other above-mentioned asset classes. At the moment Bitcoin’s volatility is very high and it can come down as fast as it went up. Let alone the future regulations could improve or crash the price.

How Bitcoin has performed over the years.

The first data on Bitcoins’ (BTC) price goes back to July 7th, 2010, when the price was $0.05. So the first bull-run took it to $18.89 in May 29th, 2011. Then it went in a bear market for almost a year, cutting the price back to around $5. After that, a year of a slow bull market sent the price to $14, and at the beginning of 2013, it exploded to $142. Not long after, it surged its way to the first four-digit price – $1,205 in 2013 November. Then BTC went in on a two-year-long bear market lowering the rate to $228.50 in August 2015.

The biggest bull-run in Bitcoin history

After that, a three-year-long bull market began. The price completely exploded and reached unbelievable heights. The cost of one BTC was $19,000! In some exchanges, it reached even $20,000! Thanks to this bull market, lots and lots of people found out about Bitcoin. Media was covering it every day. CNBC was talking about how to buy Bitcoin and encouraging everyone on it. Everyone wanted to own a Bitcoin, which, preferably, he or she had purchased in 2013. During December 2017, it almost felt like Bitcoin is the only thing what interests people. The market was booming, new projects were coming out every two hours, and it felt like – this is it! Bitcoin has gained the needed attention – now we have to start using it.

Bitcoin chart, by Mircea Mihaescu

The problems

Along with massive popularity, came the networks’ usage problems. Bitcoin transaction fees skyrocketed and reached a shocking $37 per transaction in December 21st. That meant that small payments via BTC couldn’t be transacted. Since then the hype around Bitcoin has settled. Small payments now can be made through LightningNetwork – Bitcoins’ off-chain solution for micro-transactions. However now, the transaction fees are as low as $0,01.

The Future

Today Bitcoin accepts a total of 14,227 venues across the world. The most active areas being Europe and North America. The multiple payment cards and apps give us the possibility to spend our cryptocurrency as we want. You can buy cars, houses, boats, coffee, pay for rent, mobile services, and mainly use it as money, which it is. Just recently, during the Baltic HoneyBadger Bitcoin conference, The B Foundation was announced, which is an organization through which people will have the opportunity to finance Bitcoin.

Also, Bitcoin is slowly entering the traditional equity markets. CME and CBOE launched their first Bitcoin Futures markets back in 2017, January. Intercontinental Exchange (ICE) has launched a company called Bakkt, which will present Bitcoin Futures markets as well. However, they have failed to deliver a specific date for this launch. January 24th, 2018 was the date, but due to a government shutdown, it was postponed. Also, the SEC (Securities and Exchange Commission) soon will review the multiple Bitcoin ETF (Exchange Traded Fund) applications. These milestones can bring huge funds coming into Bitcoin, which could eventually increase the price.

However, are we all in this just for the money? Alternatively, are we in for the technological or the financial revolution? How long will it take for Bitcoin to reach mass adoption, and, in general – will it be Bitcoin?

You can read the original .pdf file of the Bitcoin White-Paper HERE.

Source:

https://citywire.co.uk/funds-insider/news/the-5-asset-classes-funds-invest-in/a568135
https://www.investopedia.com/terms/i/iou.asp
https://www.buybitcoinworldwide.com/price/
https://u.today/every-crypto-collapse-has-a-silver-lining-the-current-btc-correction-has-been-smallest-so-far
https://cointelegraph.com/news/bitcoin-is-worlds-best-performing-asset-class-over-past-10-years-says-pompliano
https://www.bitcoinblockhalf.com
https://www.investopedia.com/news/only-20-percent-total-bitcoins-remain-be-mined/
https://www.treasury.gov/resource-center/faqs/Currency/Pages/edu_faq_currency_production.aspx
https://www.federalreserve.gov/paymentsystems/coin_currency_orders.htm
https://cryptoiq.co/no-launch-date-in-sight-for-bakkt-physical-bitcoin-btc-futures/
https://www.reuters.com/article/us-bitcoin-futures-contracts-factbox/factbox-cboe-launches-bitcoin-futures-contracts-cme-to-follow-idUSKBN1E10J8
https://goo.gl/dNx2Np
https://goo.gl/WsvvCY
https://goo.gl/hAV6Pi
https://bitcoinfees.info
https://coinmap.org

Cover photo by David McBee from Pexels

Russia thinking about replacing USD with Bitcoin

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Referring to recent news by Micky, it seems like Russia is seriously considering investing in Bitcoin. This could happen as early as next month, told Vladislav Ginko, a lecturer at Moscow’s Russian Presidential Academy of National Economy and Public Administration. 

Bypass U.S. Sanctions

One of the main reasons why Russia considers such a move, would be because of new sanctions by the U.S., or EU. Vladislav Ginko believes that these next sanctions could possibly trigger Russia moving their cash reserves into Bitcoin.

“Central bank of Russia sits on $466 billion of reserves and has to diversify in case there is limited opportunities to do it,” says Vladislav continuing “because of US sanctions Russia’s elite is forced to dump US assets and US dollars and invest hugely into Bitcoins.”

Russia expects new sanctions by the U.S. Government in February this year.

A possible huge price reaction for Bitcoin

If Russia is seriously considering to diversify their Dollar reserves, this could potentially mean a huge price increase for Bitcoin. Ginko is talking about several billion dollars. And that is massive for Bitcoin, as its current daily volume, according to coinmarketcap.com, is about $5 billion. Ginko believes that soon a lot of other countries will do the same, and that “Russia has a brilliant chance to invest into heavily oversold Bitcoin.”

Russian president Vladimir Putin stated on November 2018, that Russia is seeking for alternative reserve currencies. Also, Russia is working closely with China, to develop a new transaction system which would be independent of the U.S. Dollar.

Russia neither positive nor negative about cryptocurrencies

Vladimir Putin along with Russia has never quite condemned cryptocurrencies. The Russian president is one of the few world leaders who hasn’t publicly condemned Bitcoin or crypto in general. Of course, he has stated that investors must be careful operating with these currencies as there are “serious risks” surrounding crypto. Moreover, there were claims of Russia having its own cryptocurrency last year. Putin backed these claims saying “Central Bank of the Russian Federation considers cryptocurrency neither a means of payment, nor a store of value”. Also, he mentioned that this would not be possible by definition. 

Source:

https://micky.com.au/russias-billions-could-trigger-bitcoin-bull-run-next-month/

12 days of Coinbase: Coinbase implements direct crypto conversions.

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Just recently Coinbase announced their new feature – Convert. The users of Coinbase now can easily convert one crypto into another with much less fees than if doing two separate transactions. 

Initially, this service will be available between Bitcoin, Ethereum, Ethereum Classic, Litecoin, 0x, and Bitcoin Cash. The feature already is available at coinbase.com or iOS and Android apps. So far this feature is only available for U.S. Citizens, but eventually, Coinbase’s goal is to make this available to all 34 countries in which Coinbase offers native payment access.

Fees

Coinbase says that the fee of conversion will be much lower than doing two separate transactions. We naturally went to check it out, and it is true. Coinbase charges a spread of 1% for crypto conversions. But there is a catch in their Pricing & Fees Disclosures page: “However, the actual Spread may be higher or lower due to market fluctuations in the price of Digital Currencies on Coinbase Pro between the time we quote a price and the time when the order executes.”

Conversions happen instantly.

12 days of Coinbase

Recently Coinbase started an announcement rally where they will announce news 12 days in a row. On the first day they announced their gift card feature. Users can now turn their crypto into gift cards from various vendors like Uber, Nike, and many more. This is done through partnership with WeGift.

On the second day, they announced givecrypto.com and donated $10,000 worth of Zcash (ZEC) to their project to help support more than 100 Venezuelan families. “With our gift, the organization will put $1 USD worth of crypto directly into the crypto wallets of more than 100 families in Santa Elena every day for 3 months,” says in their blog post.

On Day 3 Coinbase released an explanatory video of what is cryptocurrencies.

During day 4, Coinbase added a new feature called Watchlist to their services. With it you can follow your favorite assets and personalize your dashboard.

On day 5, Coinbase announced a straight up partnership with PayPal. Customers from US can now instantly withdraw cash to their PayPal account.

Another donation on day 6. Coinbase donated $10,000 worth of Bitcoin to givecrypto.org project to help Syrian refugees.

And last, but not least, on day 7 they explained everything about their new stablecoin – USDC.

Spreading knowledge and crypto to the world.

Coinbase is an early player in the crypto space and one of the most profitable as well. It is an excellent campaign that Coinbase undertakes right now. Donating crypto to help people and expanding their services at the end of the year, it looks like they have been preparing for this all year. This is what crypto needs – more effort on trying to explain what crypto is to the wider public. Plus all that, they are giving away their profits to spread cryptocurrencies around the globe. Especially to those people who are in critical need for a little financial boost. They will initially look at cryptocurrencies as almost a savior. And we need more life stories like this. Props to Coinbase, and let’s wait what the next four days of Coinbase will bring us.

Source:

https://goo.gl/83p9y6
https://goo.gl/u9xuts

Crypto markets review, December 14

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Lately, we have seen only market falling. Not a single day of market uptrend movement or at least a bullish sign. Sure, some of the coins and tokens have seen a little uptrend, like TenX, but if we look at the big picture – the market is continuing to fall. What could be the cause for this? And what should we expect in the near future? 

Bitcoin falls under $3,500 mark

In a recent post, we also covered a market research article, and we came up with a prediction. If Bitcoin goes under $3,5k, then we should expect it to go to such lows as $2,000. After that, if Bitcoin falls under the $2k mark, we should be expecting it to go as low as $1,1k. These measures are done just by merely locating previous points in the Bitcoin chart when a bull run emerged a.i. the lowest point before a specific uptrend.

Bitcoins previous bull runs

As mentioned above, last year Bitcoin experienced a few severe bull runs, and now it’s returning to some of them. It just passed the 3.5k mark, which indicates that the coin could be going as low as $2k, or even $1,1k. If we dig deeper into the Bitcoin chart, we see, that around the beginning of last year – January to April, Bitcoin accomplished several milestones to which it could be returning. For example, if BTC goes past the $2k and the $1,1k mark, we are left with three more options where the asset could be leveling out. We have $930 as a possible milestone, next $790 and last, but not least we could be going as low as $530 for a single coin. Of course, that sounds depressing even writing it, but we are just pointing out the possibilities. There is a tiny chance that Bitcoin goes to such lows, but it’s always nice to know your choices.

BTC/USD Coinbase chart on tradingview.com

Market cap dropping

Total market capitalisation, coinmarketcap.com

The one thing which goes along with the market price is the total market valuation or total market capitalization. This chart looks like the Bitcoin chart because the market still is very volatile and Bitcoin dictates the rules of other cryptocurrencies. Also, that is because Bitcoin accounts for more than a half of the whole cryptocurrency asset class. At the time of writing, the current total market capitalization is $104,916,231,976, judging by coinmarketcap.com. Exactly one month ago, on November 14th, the full market cap was $209,106,319,178. So as you can see, it has dropped by an exact half in just a month. I mean, we are talking $100 billion in a month.

Coins react to good news

Top gainers in the top 100, Coinmarketcap.com

Considering that recently almost all crypto assets have seen a continuous downfall, it’s not a rare exception when some of the coins are gaining something as well. For example, at the time of writing, 12 assets sees a slight uptrend today. When in fact, 4 of these assets are stablecoins. At the top is Waves with +18.89% today, because they just released their new features: Smart Assets and Smart Account Trading. TenX PAY token is another asset which is soaring in the past days. They just had a Q&A with their CEO, Julian Hosp, a few days ago, where he announced the new TENX reward token. Also, he revealed new updates to the project and eased everyone’s mind about the upcoming crypto debit cards, which could start shipping during mid-December.

Waves chart, coinmarketcap.com

The possible cause

To determine the cause of this market downfall, we have to go back to when it started. This vast, one-year long bear market began at the very beginning of January. The evening of January 7th probably to most investors at that time seemed like any other day. Like any other previous day of +10 to +50% of market gains. But on that day, this market pulled a giant switch, which led to a continuous market downfall. Bitcoin had already entered its bear-run and was lounging at $14k, but the general market cap had reached its peak at $834,117,000,000. Respectively, from that day onwards, the market started to plunge. The cause could be that early investors saw a possible top forming, and began to cash out. And the same happened trough-out the year. People/investors saw the market reaching even more significant lows and fleeing the crypto scene. Possibly, putting their investments into more stable assets.

What to expect next?

The market itself is very unpredictable. It’s hard to tell whether we will continue to dig deeper into the bear market, or could we finally see a sign of a bull-market approaching. One of the symptoms could be a consecutive week of a healthy uptrend. Also, a few regulations could start the switch. However, it’s more likely to see an uptrend forming next year, rather than this year. I think it’s clear that this year we won’t see a similar market situation like last year. The only two things which are clear and 100% justifiable – from this point on, the market can go only up or down. 

Source:

https://goo.gl/aBYQB4
https://goo.gl/VBSb5G