Daily Archives: July 1, 2018

CEO of BitMEX Says Bitcoin Will Hit USD 50,000 By End of 2018

The Co-Founder and CEO of BitMEX, Arthur Hayes, says Bitcoin will hit USD 50,000 by the end of the year after possibly bottoming out in the USD 3,000 to USD 5,000 range. He says Bitcoin is just one positive regulatory decision away from a massive rally. That piece of positive news might be a Bitcoin exchange-traded fund (ETF) being approved by the Securities and Exchange Commission (SEC).

Arthur Hayes says a Bitcoin ETF would allow ‘real’ money to enter the Bitcoin market since institutional investors will be able to easily invest in Bitcoin on mainstream stock trading platforms, as opposed to the present day where buying Bitcoin is a completely different process than buying stocks. Cryptocurrency expert Michael Strutton has a similar forecast, saying that when the first Bitcoin ETF is approved by the SEC Bitcoin’s price will hit USD 35,000.

BitMEX is technically the largest Bitcoin exchange in the world with USD 618 billion of trading volume in the last year, and 3 times more liquidity than any other exchange. However BitMEX offers derivatives contracts that represent Bitcoin rather than trading Bitcoin itself, so BitMEX is usually not counted as the top cryptocurrency exchange since they aren’t trading actual bitcoins.

Arthur Hayes says BitMEX’s volume has tripled during the Bitcoin price decline in 2018. BitMEX offers clients up to 100X leverage, facilitating short selling, so BitMEX clients actually make more money when the market is declining. It is possible that the large and persistent amount of short selling on BitMEX could be a contributing factor to Bitcoin’s price decline.

Also, contrary to popular opinion, Arthur Hayes favors volatility, and he says the decrease in volatility as Bitcoin’s price has declined is bad for business. This is probably because BitMEX’s leveraged trading feeds on volatility. In general, it is recognized that less price volatility makes Bitcoin a better currency.

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Biggest LSD Raid in European Union History Seizes EUR 4.5 Million in Cryptocurrency

The Austrian Federal Police and the Spanish Guardia Civil, under the guidance of the European Union Agency for Law Enforcement Cooperation (Europol), have conducted the biggest lysergic acid diethylamide (LSD) raid in European Union history. The criminal organizations responsible were operating on the darknet and laundering their profits with cryptocurrency, resulting in EUR 4.5 million of cryptocurrency including Bitcoin, IOTA, and XLM being seized during the raid.

Two laboratories in the provinces of Granada and Valencia in Spain were raided and dismantled, resulting in the confiscation of 800,000 doses of LSD, a new record for the European Union. LSD is a popular but illegal drug which gives powerful psychedelic experiences. In total, drugs with a market value of EUR 12 million were seized. Additionally, EUR 700,000 of cash was seized, EUR 1.6 million was seized from an Austrian bank account, 3 properties were confiscated with a total value of EUR 1 million, ten luxury vehicles were impounded, and 8 were arrested and accused of drug trafficking and money laundering.

Apparently, the crime group responsible for the two darknet drug laboratories had been operating in Spain since 2012 and had been sending drugs to over 100 countries through the mail. The drugs from the laboratories were sold exclusively on the darknet, and they were supplying two websites that had become the most popular darknet drug markets in the world. However, the names of the darknet markets associated with this raid were not disclosed.

This raid and announcement comes on the heels of the biggest undercover darknet sting in United States history, suggesting there is an ongoing international crackdown on darknet drug markets and the use of cryptocurrency for drug trafficking. In the United States 2,000 Bitcoins were seized, while this Europol raid took in 510 Bitcoins.

Fortunately, Bitcoin’s price is no longer tied to darknet criminal activity, so this raid will not impact the market. A study by blockchain analytics firm Elliptic shows that only 1% of all Bitcoin transactions are related to crime. Fiat cash is used far more than Bitcoin for illegal activity.

That being said, darknet markets will continue to favor cryptocurrency as a means of money transfer due to cryptocurrency’s relative anonymity and cryptographic security. Considering how easy it is to set up a darknet market, the destruction of darknet markets in recent raids across the globe will only lead to new ones popping up, and the war between police and drug traffickers will continue across the darknet.

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Former Oxford Grad becomes UK’s First Bitcoin Billionaire at $3.6 Billion

An Oxford graduate living in Hong Kong has been identified as Britain’s youngest Bitcoin billionaire at the age of only 34, according to the Mail Online.

Ex-student Ben Delo founded crypto company BitMex, a trading platform created by a selection of finance, trading, and web-development experts, in 2014 and has subsequently amassed a fortune of $3.6 billion along with his co-founders.

Delo, who studied maths and computer science at Worcester College, Oxford and graduated in 2005 with a first-class degree, said that he worked 18 hour days to build up his platform renting out spare bedrooms on Airbnb and creating a space in his living room to make extra money.

After a spell in the City of London, he moved to Hong Kong to take a position with JP Morgan prior, to starting up his platform with Samuel Reed, a computer programmer.

Like something from a Howard Hughes biography, Delo certainly hasn’t let things go to his head though, reportedly living a frugal life in Hong Kong with his wife Pan Pan Wong, to the extent that he and his wife use food vouchers to buy food at McDonald’s. His aim is to be a Bill Gates style philanthropist donating most of his wealth to worthy causes.

There are other young entrepreneurs who are rapidly following in Delo’s footsteps who may not be a billionaire just yet but are well on the way.

At only 23 Charlie Shrem owns Evr, one of Manhattans most famous gastropubs, renowned for being one of the first establishments to accept Bitcoin for food and drink in New York. He is also a BitAngel, an investment group created to invest in Bitcoin startups.  Shrem made his initial fortune buying thousands of bitcoins at $20 each in 2011 and is thought to be worth $450 million.

At the young age of 24 Vitalik Buterin, co-founder of Ethereum has a net worth conservatively estimated to be around $450 million, although, in a recent interview with Forbes, Buterin stated that he now owned less than 0.4% of the company.

At the top of the Bitcoin Billionaires club would be the enigmatic creator and developer of Bitcoin who reportedly owns an estimated 1.1 million bitcoins.

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Tens of Thousands of Bitcoin Mining Rigs Destroyed In Sichuan Floods

Chinese media platform Global Finance is reporting that tens of thousands of Bitcoin mining rigs have been drowned in floods in Sichuan, China. Apparently, 70% of Bitcoin mining rigs are in China, and 70% of Chinese Bitcoin mining rigs are in Sichuan. This is due to an abundance of cheap hydro-electric power in the region. The Bitcoin mining hash rate actually dropped significantly at the time the floods occurred, from 43.1 exhash/s on 23 June 2018 (the all-time record for Bitcoin mining hash rate) to 30.5 exahash/s on 26 June. Global Finance says the timing of the dip in mining hash rate corresponds exactly with the Sichuan floods.

It can’t be known for sure whether the drop in Bitcoin’s mining hash rate was caused by the floods in Sichuan, but when looking at a long-term mining hash rate chart the drop in hash rate is much greater than normal variations. This is possibly the biggest drop in mining hash rate in Bitcoin’s history. The hash rate did recover to 39.5 exahash/s on 27 June, still 3.6 exahash/s below the all-time high set on 23 June, and this difference could possibly represent machines that were damaged or destroyed in the flood and offline.

According to the Global Finance news report, during the peak of flooding some hydro-electric power plants went offline due to heavy debris in the water. Bitcoin mining in China largely depends on cheap hydro-electric power, so perhaps hydro-electric power plants turning back on can explain the quick recovery of Bitcoin’s mining hash rate on 27 June.

Heavy continuous rains have impacted parts of China this week, probably associated with the monsoon which is a common summer phenomenon. 31 rivers in 6 different provinces have overtopped their banks. Flooding was especially bad in Sichuan and Shandong, with vast amounts of cropland and houses damaged. At this time estimated damage is USD 111 million, but fortunately, no one has died in the floods.

Overall, perhaps the lesson from this story is that Bitcoin mining needs to be spread out geographically to maintain a secure network. If a large amount of Bitcoin mining is concentrated in one spot it can be destroyed all at once by a disaster, which is detrimental to network security.

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More Millennials Shunning Traditional Investment Options in Favor of Bitcoin

The UK real estate developer Get Living recently conducted a survey to determine people’s attitudes towards property investment across cities in the region.

The survey revealed that 27% of male millennials considered Bitcoin to be a better long-term investment than buying a property, assuming that they were even able to get on to the housing ladder. Get Living put these results down to the high-flying performance of Bitcoin compared to that of real estate:

“For Millennials the soaring performance of Bitcoin – followed by an almost equally profound correction – holds more intrigue than the prospect of steady growth in house prices,”

These results are not simply localized to the UK economy. Another survey conducted in November 2017 by US  venture capital company Blockchain Capital showed that in the US this same demographic preferred Bitcoin ownership to stocks and government bonds.

The Harris Poll revealed that 27% of millennials would rather own $1000 of Bitcoin than the same value in stocks, with male respondents reaching a 38% preference for BTC. Other figures revealed that almost a third of millennials would shun government bonds in favor of the digital currency with 22% rejecting real estate investment for Bitcoin.

Although it was clear from the survey that males were more well disposed towards Bitcoin than the female respondents, recent surveys show that women are increasingly beginning to invest in cryptocurrencies. The number of women showing an interest in investing in cryptocurrencies in the UK has gone from 6% to 13% over the last six months, reports City AM. Another recent report by the cryptocurrency firm London Block Exchange showed that cryptocurrency is most popular with women in the millennials group.

One thousand current college students took part in another study conducted by Pollfish in March, showing that 21% of the students had used college grants to buy Bitcoin. The Student Loan survey was conducted between February and March of 2018 shortly after Bitcoin had reached record highs.

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Australian Banker’s Misinformed Bitcoin Claims Corrected by Experts

Australian Banker Tony Richard has been criticized by experts over his misinformed claims regarding cryptocurrency spouted during his speech at the Australian Business Economists in Sydney, on June 26th.

Richard is currently employed as head of the payments policy department at the Reserve Bank of Australia [RBA].

Richard’s critique

After first diving into an explanation of the basics of Bitcoin, he concluded that it cannot be categorized as a currency but instead as a ”crypto-asset.” He continued by citing that the annual energy consumption of the Bitcoin mining network is similar to that of entire countries such as Switzerland, Chile, and Austria.

Another controversial statement from Richard claimed that the high processing power requires a high amount of energy ”mainly for air conditioning to cool computer servers.”

Richard went so far as to support descriptions of bitcoin mining as an ”environmental disaster”, saying these accusations are ”not surprising.”

The backlash

These points that he offered as facts came under harsh scrutiny from several Bitcoin experts including entrepreneur Jason Smith and the Editor of Bitcoin Think, who goes by the handle Beautyon.

Smith pointed to the publically available hash power data and the prominent usage of green energy in mining setups as a verified contradiction of Richard’s claims. He rejected Richard’s misinformed statements, pointing him to look into the published data.

Beautyon offered a similar criticism on their Twitter account, questioning how the Head of Payments Policy Department at the reserve bank of Australia could not have peer-reviewed his speech. ”All his objections come from other sources and are wrong. Most astonishing is that they think no one is watching,” they said.

Posting again on Twitter, Beautyon condemned those such as Richard whos ”lives rely on the fraudulent fiat system” saying they will ”lie to you about Bitcoin.”

Remember. People whose livelihoods rely on the fraudulent fiat system are going to lie to you about Bitcoin. They are not going to stop lying. Ever. Because they’re not intelligent, they can’t come up with their own lies, and will copypasta lies from other liars. Easy to spot.

— Beautyon (@Beautyon_) June 27, 2018

 

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Decentralized Digital Asset management Platform IP Gold Shifts To NEM, Announces Bonus During Token Distribution For The First 24 Hours

Digital asset management is only as efficient and manageable as the ecosystem it runs on. IP Gold, a digital asset management company, understands this. The platform is already running on Ethereum’s backbone. However, it has recently decided to shift its whole system on one of the most efficient blockchain ecosystem available: NEM.

NEM Selection

The company, after careful study of all the platforms and networks available, decided to migrate itself to the NEM network. Although already running on the much more popular and well established Ethereum network, the company realized that with nearly every other platform and company using the largest decentralized network as its backbone, Ethereum is getting strained and overloaded with hundreds of tokens and dApps. The most famous example has been the CryptoKittes DApp, which nearly brought Ethereum to a halt when a huge number of users started downloading and using the decentralized application.

A long term viability was required for the company to continue operating and providing its services without worry of network slowing down. NEM, an alternative with more scalability, higher level of security, lower transaction costs yet higher transaction per time and increased corporate features was the perfect solution.

David Greishaber, CIO IP Gold said, “The proven scalability, support, and security of the NEM blockchain offers the most future-proof platform for the IPG token and IP Gold community. NEM’s peer-to-peer architecture, proof of importance (POI) algorithm, encryption and multisig account support made it the obvious choice for IP Gold’s long-term goals.”

IPG Token TGE

IP Gold is already holding public token distribution event and has decided to give a bonus of 50% for the first 24 hours (3rd July) of the switch. Currently the TGE is in progress and the exchange rate has been established at 1 IPG = 1 USD. The bonus means that for every dollar backed, investors will receive half a IPG. The event is seeing 13,000,000,000 IPG up for grabs and will continue till 10th of July.

About IP Gold

Of the many digital assets, IP addresses have turned out to be the most valuable. IP Gold is a digital asset company that specializes in monetizing this lucrative sector. IP are regularly leased and traded on the international market. IP Gold takes that simple concept and leverages the blockchain technology to not only streamline the marketplace, but reduce overheads and bring efficiencies to the system.

With 4,300,000 IPv4 IP addresses possible, less than 4% are left available. The increased demand of IPs and the dwindling demand has led to an increased value of the internet addresses. IP Gold banks on this and allows anyone with ownership to an IP that is not being currently used to rent out and earn from it, which would be otherwise not generating an income.

For more information on the IP asset management platform, visit their website: https://ip.gold/

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