Category Archives: altcoin

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Venezuela’s Petro Token Faces Allegations of Falsified Records

The controversial state-backed cryptocurrency of Venezuela, El Petro token, has met further contention after allegedly holding falsified records regarding the initial coin offering (ICO). Venezuelan president Nicolás Maduro reported USD 5 billion raised during the event, but both CCN and Criptomoedas Fácil report a discrepancy in the total reported and the amount possible to be raised according to the information on the whitepaper.

The Numbers

The whitepaper for the Petro token records 38,400,000 tokens in total to be sold, each valued at USD 60, and with a 60% discount added during the ICO stage. For each of these tokens to be sold at their valued price, the ICO would have raised USD 2.304 billion before subtracting the discount. The official documents released by Maduro reporting USD 5 billion raised is in direct contradiction to this.

This indicates that either the whitepaper contains misleading information about the actual value of the Petro token or that Maduro announced false claims about the earnings of the ICO.

Following the ICO, Maduro detailed the event received 200,927 participation requests from 133 different countries.

Further Controversies For El Petro

Each unit of El Petro is backed by one barrel of oil in Venezuela, introduced by Maduro to combat economic sanctions due to a what he dubbed a US-led blockade. There are, however, many that challenge the integrity of Maduro’s ambitions, denouncing it as a plan to compensate the lack of oil production that is seeing the state’s economy plummet.

Maduro does not have full support from his government, with the Venezuelan congress recently ruling El Petro as both unconstitutional and illegal. The National Assembly of Venezuela dubbed the currency a fraud, and a threat to potential investors. With many citizens in Venezuela struggling to provide themselves with basic essentials such as food and medicine, there is a call to invest the money raised in the ICO into rebuilding the economy. This would prove logistically challenging, as investors would surely demand compensation.

China-based credit rating firm Dagong see the Petro token as a good investment, however, suggesting it may aid international currency markets.

Other controversies aside, Maduro must address the financial discrepancies regarding the profits made from the ICO for it to be considered legitimate tender on exchange platforms.

 

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Bitcoin on the Rise: Bullish Trends and the G20 Influence

It has been a tough month for Bitcoin coming off the winter boom but there have been several standout moments offering respite from bearish trends and contributing to the current uptrend in the Bitcoin markets.

Firstly, Thomas Lee, the head of research at Fundstrat Global Advisors and his team have released an interesting flow chart (below) that describes the phases of the altcoin market cycle.

While it indicates that the majority of the decline is behind us, their graphs don’t quite inspire an immediate sense of confidence with the purgatory phase apparently in effect and it is still relatively hard to tell when things will begin to look definitively bullish again.

The Risk of Stagnation

How deep this current period will be is still unknown, but it could be noted that markets tend to react swiftly, particularly to positive news, progress in innovations and regulations.

The stakes for blockchain technologies and cryptocurrencies are higher than ever; the past couple of years have seen massive progress with efforts to make the industry more consumer-friendly and regulation-compliant. Despite the scandals of scam ICOs and the recent crackdown on cryptocurrency advertising, the blockchain industry is holding on tight and is more active than ever.

The pressure on altcoins to adapt or die is growing and this slump could spark further indecisiveness and cynicism, dampening the progress that new or established blockchain companies have been making over the past year.

These being worst case scenarios, anything at all can happen in this business, so it’s best to keep an open mind, especially as big organizations, governments, industry heads and key figures are all putting the conversation about cryptocurrencies on the table.

A Good Influence

The G20 Summit is considered partly responsible for the upswing Bitcoin has seen over the past couple of days. Mark Carney, governor of the Bank of England, stated in a letter to G20 finances ministers: “The FSB’s initial assessment is that crypto-assets do not pose risks to global financial stability at this time.”

He continued: “Crypto-assets raise a host of issues around consumer and investor protection, as well as their use to shield illicit activity and for money laundering and terrorist financing. At the same time, the technologies underlying them have the potential to improve the efficiency and inclusiveness of both the financial system and the economy.”

A Little More Conversation and A Lot More Action

If the brains at Fundstrat are correct, then this low period of inactivity and consolidation could be a sluggish ride and set the evolution of this industry back for some time. This is the chance for the industry to begin shaking hands with the regulators, influencers and institutions that can begin to create a space for the technology in the everyday lives of the world.

Conversations such as this may only boost Bitcoin value for so long, however, and the bear market could still very well be in play. But the critical part to take away from all of this is that more and more powerful influencers are talking about how to make cryptocurrencies work.

Now let’s see some action.

 

 

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Single-purpose cryptocurrencies have a problem

Let’s face it. There’s a slight problem with cryptocurrencies and no, it’s not the issue of regulation. And no, it’s probably not the volatile markets or any other buzzwords or catchphrases you can think of.

Spoilt for choice?

It comes down to the eye-watering amount of pending and existing cryptocurrencies. CoinMarketCap.com has, at present, 1,565 coins and tokens listed; it’s a mind-bogglingly large number of cryptocurrencies and, to an outsider, it doesn’t quite make sense.

Cryptocurrencies are viewed as these odd digital credits that you can purchase for real money and well, that’s about it.

Unless you’ve painstakingly spent the time searching around for places and businesses in which you can go to spend your cryptocurrencies, then you’re likely nonplussed about the whole Bitcoin boom. And if you have taken it upon yourself to search for a place, you’ll come up with a few traders and merchants that accept Bitcoin (BTC), Litecoin (LTC), Ethereum (ETH) or any of the ‘big coins’ in the business.

Or too many cooks?

Then there is the second part of this issue. It comes in the form of a question and be prepared to think about this one. When there are 180 UN-approved currencies in the world, what good is it to have 1,565 coins?

The logical conclusion would be that the majority of these coins are entirely redundant, but that just isn’t the case.

A staggeringly large number of coins are utility tokens that solely function within an internal economy on their native platform, and this also is by no means is a particularly healthy situation for the industry at large.

Imagine that, to access your Google Drive Cloud storage you had to pay with a cryptocurrency to do so. Every single time you acted within its cloud storage platform it would be ‘fuelled’ or ‘funded’ by a coin designed explicitly to do so.

Well, you have all your cloud-storage tokens, now how about some Starbucks tokens to get your coffee? Do you have enough Apple tokens to make purchases through the App store or have you not converted enough of those tokens from the tokens you use to pay your rent?

Notice anything odd with the above?

Cryptocurrencies by their hundreds tackle niches within industries, offer solutions to some particularly fringe topics which may excite the novice or veteran traders who know how to navigate the markets profitably.

But to assume that the everyday cryptocurrency users will happily and continuously go through the process of converting their primary coins such as BTC or ETH to gain access to things that regular currency can buy? It just doesn’t seem logical and will stifle the blockchain industries’ efforts to get adopted en masse globally.

The single-use tokens that exist will have to shorten out at some point if there is to be any hope for the industry to have an easily accessible, widely available and uncomplicated future for its consumers. To the average onlooker, it’s safe to say that less is more.

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