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This Week on Coin Street – 29th October 2017

Week ending October 29, 2017

Your weekly roundup of all things crypto brought to you by Coin Street

Neil’s Market Wrap

It’s been a more normal week for crypto (as oxymoronic as that might sound).  Bitcoin has retraced from an all time high but found good support around the $5750 mark and has been trading sideways for a few days.  Alts have seen some degree of recovery although most are still a long way from their all time highs earlier in the year.

News of regulations, adoption and innovation abound and all contribute to legitimising the space and making it more accessible and mainstream.  The huge volatility in the markets continues to temp in speculators but at the same time provokes caution in retail investors.

The next big event in the crypto space is the Segwit 2x fork in November (around the 16th).  Until then investors are holding their breath.  It’s anyones guess what’s going to happen to prices just before and after the fork, experience and logic suggests we will see another run up in Bitcoin prices in the days before and quite possibly a decent correction just after.  However this is crypto and one thing we have learned for sure is to expect the unexpected.

My big news pick for the week is fresh out the box and has far reaching ramifications.  A recent report from the UK Government’s Treasury department has determined that crypto currencies pose a low risk for terrorist financing and their use for money laundering also remains relatively low.  This is important because crypto currencies are plagued with the viewpoint that they are popular with drug dealers, terrorists and otherwise nefarious characters and industries. Proponents of our industry have long know this is ridiculous and that compared to cash crypto is actually far more traceable and accountable which therefore makes it less attractive to the underworld, not more. However to have a major world government come to this conclusion is major news. (Source).

This Week’s Highlights

What the fork?

You may have heard the word fork being used a great deal lately.  The rogue fork Bitcoin Gold has come and gone without having much effect on the BTC market so all eyes are now on the Segwit 2x fork in November.  In very simple terms, a fork is when the developers of a crypto currency alter the code so that a new version of the coin in born.  Read more here if you wish to gain a greater understanding of forks and forking.

Digital Diploma Debuts at MIT

The Massachusetts Institute of Technology issued 111 students a digital copy of their diploma using a blockchain and wallet they have developed to give students autonomy over their own records.   (Source)

More Wall Street firms jumping into crypto.

As the Financial Times reports, the number of traditional investment firms jumping into the crypto speculation world is increasing.  Now where is that ETF… (Source)

Russia promises regulations will not stifle ICOs.

After a couple of weeks of conflicting messages and news, Russia’s First Deputy Prime Minister Igor Shuvalov promised not to let initial coin offerings (ICOs) in Russia “die” because of regulations last week. Despite bills being prepared to regulate them, President Vladimir Putin has said that ICOs hold “tremendous potential” and should not be obstructed.  (Source)

Mastercard opens access to it’s Blockchain tech.

Mastercard has opened its blockchain technology up to developers, allowing financial institutions and merchants on a selective basis to start testing their own blockchain-based solutions.

The payments giant said it both tested and validated its blockchain, and has prepared it initially for the business-to-business (B2B) space to address challenges of speed, transparency, and costs in cross-border payments. (Source)

Crypto companies given the cold shoulder by UK banks. And the FCA don’t like it

The UK financial regulator, the Financial Conduct Authority (FCA) has accused financial institutions of withholding financial services from distributed ledger technology (DLT) start-ups on a wholesale basis. The assessments have been published in a report examining the outcome of the nation’s ‘regulatory sandbox’ one year after its launch. (Source)

Saudi Arabia doesn’t think Bitcoin warrants regulation, yet.

The Saudis are keeping an eye on Bitcoin but they believe at this stage it doesn’t warrant regulation.  After all people liken it to a digital Gold, not Oil! (Source)

Samsung made a mining rig out of old mobile phones.

This is so geeky, we love it.   (Source)

And finally, it’s not a bubble.  Honest

On-line Plc jumped as much as 394 percent on Friday after announcing plans to change its name to On-line Blockchain Plc, following an initial climb of 19 percent on Thursday when it first announced the news.

This is reminiscent of companies in the nineties adding .com to their names and seeing their price skyrocket.  Remember how that turned out? (Source)

 That’s a Wrap

That’s all for this week.  It’s a fast moving space.  They say one week in crypto is a year in the real world.  

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See you next week.

Top 3 Myths About Bitcoin

The ever-increasing popularity of Bitcoin as a digital currency and alternative form of payment for merchants has brought an huge increase in the number of new users.

But with so much negative media coverage, it’s easy to get carried away from its real intrinsic innovative value.

So here are the top 3 myths that you should know about Bitcoin.

Myth 1 – Bitcoins don’t have real value

It’s true that many cryptocurrencies are valued largely through speculation.

Factors driving speculation value (TICOS):

  • Technology the currency is based on
  • Ideology behind its creation
  • Credibility of development teams
  • Overall mission of the currency
  • Scale of solutions it offers

However, when it comes to Bitcoin, the currency holds both – measurable and speculated – value.

Millions of people around the world use bitcoins for it’s ability to send or receive money cheaply.  There’s a fixed supply – 21 million coins – and a constant demand for the currency.  Hence, there is ‘real’ value in it.

Myth 2 – Bitcoin transactions are completely anonymous

Contrary to what you may read in the mainstream media, the currency is in fact NOT completely anonymous.

Although it’s true that it is hard to identify someone’s real identity through tracking bitcoin transactions, it is still possible.  All Bitcoin transactions are recorded publicly on the blockchain and it is possible that authorities could uncover the person’s identity through a subpoena.

Hence, it is most safe to say that Bitcoin transactions are pseudonymous.

*Tip: Anonymity may be improved by using Bitcoin addresses only once and/or tumbling coins through a coin-mixing service.

Myth 3 – Only criminals use Bitcoin

It’s true that Bitcoin has been used for various criminal activities and as such, it has attracted a lot of negative media coverage.

With high-profile cases such as Silk Road and BTC-e money laundering scandals, Bitcoin has often attracted more negative press than positive.

However, the statement “Bitcoin is only used by criminals” is just not true.

Bitcoin’s ecosystem is growing rapidly with many legitimate businesses accepting the currency.  It can even be used offline through dedicated credit/debit cards and the currency’s market cap recently hit $70 billion USD (late-August, 2017). The point to note is that cash, when used directly – without any banks or financial services involved – is in fact, more anonymous and untraceable that compared to bitcoins.

 

Bitcoin Real Estate – A Marketing Gimmick or Haven for Under the Radar Transactions

 

Recently there has been an upswing in news reports of real estate deals being completed in Bitcoin.

It’s something that people always ask about Crypto.  What can you actually do with it?

Sure we’ve all heard the story from years ago about the person who bought a couple of pizzas now valued at 10 million dollars.   But things have changed and the market is now mature.  There are a lot of people looking to divest their interests and take profit from their gains.

First we heard early last month that a developer in Dubai was offering 150 apartments in a new development priced in Bitcoin.

Around the same time, The Guardian reported that a landlord in London was accepting deposits in Bitcoin (not a bad idea in our opinion given the fact the deposits are generally held for a minimum of six months, a long time on the Crypto markets!)

Later in the month, several sources reported that the first all-Bitcoin property transaction had been completed in Austin, Texas.

Finally, in a story further on the fringes it was reported that a flat in the South-side of Glasgow was sold for some 60 million ScotCoin.   What is ScotCoin?  A coin started in the hope of achieving notoriety tied to Scotland’s independence bid in 2014.

Just a Marketing Gimmick?

For all of these transactions, ultimately the seller cashed out the Crypto they received into fiat currency.  Some would argue that this effectively made each of them a standard sales transaction using the profit from Crypto rather than a genuine crypto transaction.  Others have dismissed these as being pure marketing gimmicks, riding on the wave of Crypto enthusiasm.

Another Motivation?

However, true Crypto to Crypto property deals do take place, although they garner less attention due to the dubiety of their nature. Much as OTC (over the counter) Crypto transactions account for more than half of all global trading, there exists an pool of off-market property transactions being done in Crypto which don’t make the headlines.

This is a huge market, and has been for years.

Buying heritable assets for Crytpo is big business as long-term investors looking for ways to divest their gains and take profit, without cashing out to fiat.  Why?   Every buyer has their own reasons.  But it’s not impossible to imagine that attempting to skirt the tax implications of a deposit into fiat plays a role.

Dedicated websites such as Bit Premier and www.bitcoin-realestate.com cater to a range of budgets across a huge geographic area and demand is high. We spoke to a source involved in the market and he told us; “It’s big business.  There are a bunch of folks who made millions in crypto who don’t know what to do with their gains. We help them take profit by investing in property worldwide. We assist them navigating the paperwork, tax liabilities and compliance issues and we ensure that both parties end up with an airtight deal.”

So whether it’s a holiday getaway in Tulum or a returnable rental investment in a major US city one thing is for sure. If you have enough Crypto, you can buy whatever you like without ever going near a fiat currency.

Where would you buy?

Floyd Mayweather Promotes ANOTHER ICO

Floyd is back!

As we reported back in August, Floyd Mayweather is fast becoming the (well paid, we assume) voice of ICOs.

Hot on the heels of his Stox and Hubii promotions, Floyd is now endorsing the Centra ICO.

Floyd Mayweather Centra ICO

On a side note:  this comes just days after the FTC apparently sent warning letters to Instagram influencers reminding them to disclose business relationships for products they promote.

What is Centra?

We have no idea to be honest.

Looking at their site they are apparently “a Crypto debit card for Bitcoin, Ethereum & more.”  Their Debit Card “enables users to spend their cryptocurrency in real time with a 0% exchange, spend, & withdraw fees”.

That’s all well and good.  But we’re left here wondering:

Is there an ICO that Floyd Mayweather doesn’t promote?

Crypto Search Growth Update

The charts below from Google Trends tell you all you need to know.  The world is waking up to the idea of Crypto and it’s no longer just “bitcoin”.

We expect to see the trend continue as we move into 2018.

Crypto Search Growth September 2017

 

Crypto Exchange Coinbase Hits 10 Millions Users

Forget about the daily ups and downs of the price of Bitcoin and altcoins. This is the perhaps the biggest news of the day.

US-based cryptocurrency exchange Coinbase has reached 10 million users.

Coinbase 10 Million Users

The growth rate is staggering. Coinbase announced that over 800,000 new users were added in the last 3 weeks of August alone.

You can check out the latest Coinbase user numbers at their status page here.