Austrian Financial Market Authority (FMA) Sees A Sharp Rise in Crypto-Related Fraud

Austrian Financial Market Authority (FMA) Sees A Sharp Rise in Cryptocurrency Related Fraud

The Austrian regulator reported a record amount of potential frauds in 2020. And cryptocurrencies are at its center, with two-thirds of investment fraud reports related to digital assets trading products.

Besides cryptocurrencies, the frauds were related to gold and stocks, Financial Market Authority said in a statement.

A rise in scam offerings for digital assets was seen on “dubious” platforms that were often advertised on social media like WhatsApp, Telegram, Facebook, or TikTok, the regulator said.

“We see a great need for stricter regulation,” FMA spokesman Klaus Grubelnik said on Friday.

He further said the prosecution of these cryptocurrency-related frauds was even more difficult because investigations have to be conducted across borders. While fake offerings for bullion and stocks have been around forever, the shaft has now been seen towards the digital assets “because of the hype,” Grubelnik said.

In 2021, so far, the price of Bitcoin has surged past $57,000, hitting a trillion-dollar market cap. The entire cryptocurrency has been enjoying a bull run, with the overall market capitalization going past $1.75 trillion.

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Author: AnTy

JPMorgan: Bitcoin’s Rise Coming at Gold’s Expense; BTC Price Overshot, Bullion Due for Recovery

JPMorgan Chase says the rise of digital assets could make gold suffer.

While money poured into Bitcoin in October, gold saw a record amount of outflows. According to the bank’s quantitative strategists, including Nikolaos Panigirtzoglou, this trend is only going to continue in the long run as more institutional investors take a position in the largest crypto asset.

Over the past few months, many have recognized Bitcoin as a good alternative to gold, and JPMorgan is just one of them. As we reported, even Ray Dalio is warming up to digital gold, with Citi, Wells Fargo, Deutsche Bank, and others seeing Bitcoin as a diversifier to the yellow metal.

Compared to bitcoin’s 156% return YTD without even hitting $20k yet, bullion only raked in 20.5% gains in 2020 after reaching a new peak.

“The adoption of bitcoin by institutional investors has only begun, while for gold, its adoption by institutional investors is very advanced,” wrote the JPMorgan strategists.

According to the bank’s calculations, for now, Bitcoin only accounts for 0.18% of family office assets compared to gold ETF’s 3.3%.

However, bitcoin is seeing a lot of demand, as seen with the Grayscale Bitcoin Trust, which saw an inflow of almost $2 billion since October, while gold ETFs had a $7 billion outflow during the same period.

“If this medium to longer-term thesis proves right, the price of gold would suffer from a structural flow headwind over the coming years,” wrote JPMorgan’s strategists.

Bitcoin Flow from Gold Funds
Source: Bloomberg

In the short-term, the bank sees Bitcoin prices overshot, hence a selling with gold due for a recovery.

However, many believe both gold and bitcoin should be part of a portfolio. Even Dalio said Bitcoin has similarities to gold and other store holds of wealth.

“Gold buyers do not care what JPM thinks. Americans don’t buy or own much gold. 92% of demand is outside of US. Bitcoin the fastest horse and can go up 20x-would be worth $6 trillion. If so gold doubles to $20trillion in mkt value. Plenty of value to go around,” said Dan Tapiero, co-founder of 10T Holdings.

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Author: AnTy

Several Catalysts Will Drive the Demand for the Scarce Digital Asset, Bitcoin: Fidelity

Bitcoin’s inherent properties have given rise to the perspective that the digital asset could be a store of value, states Fidelity in its latest report on Bitcoin Investment Thesis. It is actually an “aspirational” SoV, creating value as it matures into a store of value.

Fidelity likened investing in bitcoin today to investing in Facebook when it had 50 million users with the potential to grow to the more than 2 billion users it has today.

One of the key arguments against bitcoin being an SoV today is its volatility, but even upward volatility attracts investment, development, and innovation.

But there is no long-term value to store it if there is no sustained demand for the digitally scarce asset and a decentralized settlement network. According to the report, the demand for the digital asset would grow incrementally.

The Catalysts

External forces that are accelerating interest and investment in bitcoin include unprecedented levels and exotic forms of monetary and fiscal stimulus globally, which is exacerbating the concerns that Bitcoin was designed to address as such leading more users towards bitcoin as an “insurance policy.”

This is a near-to medium-term catalyst where as many as 285 stimulus measures have been announced in just eight months, including virtually zero interest rates, increasing money supply via QE, and a range of lending facilities.

These measures were taken by central banks and governments to counteract the deflationary pressures created by global lockdowns to mitigate the spread of coronavirus. These restrictions and lockdowns have also propelled deglobalization, yet another catalyst for bitcoin.

“The increase in money supply may translate to an increase in the price of risky or scarce assets,” it reads. In case the combination of policy leads to inflation or if it stays suppressed, but nominal leads stay low or go lower, investors may turn to an asset that maintains its real value and cannot be printed.

Traditionally, investors turn to fixed supply assets like real estate, dividend-yielding stocks, and precious metals. Still, this time they have a new type of fixed supply asset available that has “significant growth potential.”

Simultaneously, the massive transfer of wealth from the older generation to a younger one is a gradual process but an important long-term tailwind, as younger people view bitcoin more favorably. Long-term wealth preservation is yet another factor to drive this demand.

According to WEF’s 2017 Global Shapers Survey, 45% of the 30,000 millennials surveyed said they don’t trust banks to be fair and honest. Edelman’s October 2018 survey of affluent millennials, those aged 24-38 with $50K in investable assets, found 77% of them believe “the whole financial system is designed to favor the rich and powerful.”

There has also been an affinity in millennials towards bitcoin relative to traditional stores of values like gold. About 90% of ETF Store’s millennial clients prefer bitcoin to gold, which they say is “landslide.”

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Author: AnTy

Binance And OKEx Latest Crypto Exchanges To List, COMP, Compound’s Governance Token

Compound (COMP) is setting an impressive rise since its launch a fortnight ago with the coin’s price, popularity, and total value locked have seen multiple times growth rates since then. Additionally, several crypto exchanges have rushed to list the token after its impressive performance. After additions to Coinbase Pro, Coinbase, and FTX derivatives exchange, COMP is now set to start trading on OKEx and Binance.

OKEx launches COMP spot trading

Big exchanges are jumping on to listing Compound’s governance token in what can only be described as a FOMO move listing a two-week-old token. OKEx becomes the latest exchange to launch trading pairs of the coin, including the Tether (USDT) and Bitcoin (BTC) pairs.

Users can buy, sell, deposit, and withdraw COMP from the exchange as of Monday, Jun 29, the announcement reads. Trading opened at 9 AM UTC, and as at the time of writing, only 228 COMP has been traded on both pairs on the exchange.

COMP currently trades at an average of $235 across major exchanges representing a 4.31% drop in the past 24 hours. The daily trading volumes remain high at $11 million across 31 listed pairs on over ten exchanges – COMP reached an all-time high daily trading volume of $31 million on Friday.

Safe or not? Binance launches futures trading

In a similar breath, Binance launched futures trading of the COMP token offering USDT settled contracts starting Tuesday, June 30. The statement reads,

“Binance Futures will launch COMP/USDT perpetual contract, with the trading opening on 2020/06/30 09:00 AM (UTC). Users will be able to select between 1-50x leverage.”

However, a section of crypto traders has come forward criticizing the exchange for its high leverage positions on a relatively new token in the market. It is a question of making a profit vs. a safe environment for traders.

Binance, which has been at the forefront in speaking on the need to protect users, faces a dilemma as the volatility of an unproven token may cause a similar flash crash to Matic Network’s in December 2019 and with it liquidate users’ funds.

Rise to the top

Compound is a platform that allows users to earn interest by lending and borrowing digital assets. Launched in 2019, the company ascend to the top of the DeFi industry comes as a shock to many. Compound is currently the largest DeFi platform overtaking Maker (MKR) in total asset value locked (TVL), according to Defipulse.com.

Compound dominates the industry with $626 million in digital assets locked on the platform, representing 38.2% of the total value in decentralized finance.

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Author: Lujan Odera

Ethereum’s Top Coin Mixer, Tornado Cash, Updates Contract to Become Fully Trustless

  • The cryptocurrency industry is becoming more anonymous with the rise of coin mixer companies like CoinJoin, enabling users to mask their transaction history on the blockchain.
  • Recently, Ethereum’s top mixer announced developments on its platform to create a “completely trustless and unstoppable” mixer.

Tornado Cash Completes its Biggest Trusted Setup Ceremony

Ethereum’s top coin mixer, Tornado Cash, announced the completion of its “trusted setup ceremony.” A cryptographic process in its latest version, and further modified its smart contract to create a perpetual self-executing code.

According to the official announcement on Medium, the ceremony, completed on May 10 represented the largest ceremony yet in attendance.

The published post reads:

“We are happy to announce that our trusted setup ceremony is now complete. With a record 1114 contributions, this was by far the largest Trusted Setup Ceremony to date.”

Previous all-time high attendance in the conference was around 200 participants, which shows the ballooning growth in privacy-focused platforms.

The platform will now employ a cryptographic method known as multi-party computation (MPC), enabling secure key management by sharing fragments of the key on multiple computers. This ensures that at no point is a single, vulnerable computer responsible for an actual key.

Despite Tornado Cash’s new version launching with MPC security functionalities and the self-executing code, some analysts remain wary on the platform offering total anonymity.

Privacy Concerns on Coin Mixers

One of the biggest challenges that coin mixers face in masking transactions is the lack of a deep “anonymity set”. The more cryptocurrency brought into its ecosystem – the better.

With a larger number of transactions coming into the platform, the more secure the mixer will be. Mixers rely on several transactions to better obfuscate those coming in and going out of the platform.

Crypto Data Company, Chainalysis’ Maddie Kennedy said there are concerns on the level of security these mixers provide as the company still finds loopholes to track users’ transactions. He said:

“While mixers, CoinJoins, and solutions like Tornado Cash can make tracing funds more difficult, Chainalysis can often still follow funds through them.”

Moreover, Gavin Andresen, Bitcoin Core’s early developer, argues that coin mixers are still leaving room for user transactions to be traced, given the complexity of using the platforms privately. He echoed Kennedy’s point adding:

“It is really hard for mere mortals to use something like Tornado (or CoinJoin or other similar technologies) in a way that doesn’t leak information about their wallet.”

The Regulation Dilemma

Finally, coin mixers face a regulation dilemma as countries focus on these platforms as money transmitters.

So, what is the issue with this? Well, money transmitters are regulated by the government and therefore have “obligations” set by the Bank Secrecy Act (BSA). This law requires strict adherence to KYC/AML, which beats the purpose of the mixers.

In a bid to be on the right side of regulation, Tornado Cash v2 will include a cryptographic note that will allow exchanges, authorities, and governments to trace the transaction history if the holder provides it.

However, regulation is not something that Tornado’s Storm and co-founder Roman Semenov fear as Storm explained that the self-executing code does not implicate the developers.

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Author: Lujan Odera

Bitcoin (BTC) Price Analysis (April 24)

Key Highlights       

  • Bitcoin’s price valuation has made an upward rise briefly past $7,600 distribution territory.
  • The bears are gradually getting weaker in BTC/USD trade operations.
  • BTC/USD Traders should be wary of a $7,600 mark.

Bitcoin (BTC) Price Analysis

• Major distribution territories: $8,000, $8,400, $8,800
• Major accumulation territories: $6,800, $6,400, $6,000

Bitcoin’s price valuation has made an upward rise briefly past $7,600 distribution territory during the yesterday’s trading sessions. The US dollar seems to be getting weaker as price now hovers around the price value earlier stated.

The bulls now appear in a higher buying spree, having broken northward through the last range upper point at $7,200. But, the market movements are presently converging heavily around the $7,600 value. As it is, the bears aren’t having it smoother to push against the crypto’s gradual appreciation moving mode.

Bitcoin Technical Indicators Reading

The Upper Bollinger Band has bit stretched northward. Short candlesticks are near its path. The 50-day SMA trading indicator and the Middle Bollinger Band are conjoint pointing to the north from underneath. Those indicate that the buyers are somewhat in control of the market. The Stochastic Oscillators have joined the hairs together around range 80. And, they now consolidate around it to signify an indecision trading condition of BTC/USD trade.

Conclusion

Though, there has now been a sign of seeing more ups in the market operations of BTC/USD. Also, the crypto-market may experience a line of corrections downward averaging a low mark at $7,200 before regaining the strength to further the journey to the north. A bearish pressure may occur at a $7,600 spot. And, it may not be ideal for a long position trading psyche.

Disclaimer: The presented information is subjected to market condition and may include the very own opinion of the author. Please do your ‘very own’ market research before making any investment in cryptocurrencies. Neither the writer nor the publication (bitcoinexchangeguide.com) holds any responsibility for your financial loss.

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Author: Ben Jordan

Coinbase Signals A Positive DeFi and Stablecoin Outlook Amid COVID-19 Uncertainty

The crypto lending market has been on the rise despite the unprecedented uncertainty following the novel coronavirus (COVID-19) pandemic. This market has grown to a significant $13 billion in loans within the past few years presenting an opportunity for DeFi’s and stablecoins to gain more traction within the young market. According to Coinbase’s recent blog, innovations in this space are set to attract more lucrative interest rates given the growing demand in crypto based assets.

Ideally, these markets allow investors to borrow or stake collateral on the digital assets owned by the individuals or entities. Coinbase has since moved to capitalize on the current market opportunities as the crypto industry struggles to match the ongoing global downtrend in asset prices. Despite the bear markets, lending products within the crypto niche have become more expensive. Recent reports within the industry have attributed this valuation to the volatility of digital assets and the opportunities to make money off stablecoins.

DeFi Interest Rates on the Rise

The DeFi crypto market has emerged as a safe haven for some investors looking to leverage its volatile nature amid the COVID-19 pandemic. According to Coinbase recent blogs on the crypto market opportunities, this space presents an opportunity to make money off the current trends given its prevailing uncertain nature. The blog reads,

“More lending desks will accept crypto as collateral, stablecoins will grow in adoption, crypto to fiat bridges will be more efficient, and DeFi will become more mainstream and have better protections against smart contract risk.”

The blog further highlights that crypto market stakeholders are opting for stablecoins as the market stakeholders seek certainty. Based on this development, Coinbase wrote that the market rates might gradually increase as crypto adoption grows globally,

“Until then, we can enjoy higher APY on stablecoin lending rates on places like Compound, Dharma, and Dy/Dx.”

Stablecoin Prospects

These pegged digital assets have also been growing since the market plummeted in mid-March. Coinbase noted that’s these crypto coins have been attributed to more stability as market participants acquire less volatile instruments within the crypto assets. The blog particularly notes stablecoins’ can be used more actively compared to peer cryptocurrencies,

“It takes time to upload cash into crypto. Many borrow use-cases require immediate action, and thus restrict options to crypto-native solutions where stablecoins are ready to deploy. This increases demand for stablecoins.”

Coinbase added that they are optimistic of the market growth as more borrowers move to capitalize on the available arbitrage positions in crypto derivatives and the high APY rates on stablecoins. In addition, they noted an intention to make a killing off the prevailing market prices,

“Market sentiment specifies demand preference, but overall demand remains high in both bullish and bearish markets. Coinbase will look to expand borrow / lend services where possible with the goal of increasing borrow / lend liquidity and helping the crypto market mature.”

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Author: Edwin Munyui

Bitcoin Mining Costs Set To Skyrocket 80%-120% After Halving, Tradeblock Report

  • Bitcoin (BTC) mining costs set to rise over 80% after the May halving, a new report states.
  • Incorporating assumptions into its model, researchers from TradeBlock expect the price to skyrocket to $90,000 USD following the halving.

A new halving report from TradeBlock, a crypto data research company, the price of Bitcoin (BTC) is set to skyrocket past $90K after the halving, expected to occur in mid-May this year. However, the researchers warn that a number of miners will have to shut down if the prices of BTC do not rise pat the current $10,000 resistance level as mining cost are expected to double from current costs.

Mining Costs Set to Grow Over 80%

As Bitcoin’s supply rate is cut down in half from the current value of 12.5 BTC per block to 6.25 post-May halving, mining costs will also be on the up. The report take up a number of assumptions to rightly come up with the predictions on the cost of mining post-halving.

First, TradeBlock gave a rough estimate that the block reward halving will cause an 80% spike in mining costs to $12,525 USD. The research sets an assumption that new mining equipment will come into the market making it easier to mine BTC despite reduced rewards.

The research factors in that 30% of the current miners will adopt these new mining equipment, expected to launch in March 2020 following a delay due to coronavirus epidemic. Furthermore, the research assumes the average cost of 6 cents per Kilowatts according to average U.S estimates.

Is a Miner Capitulation on the Horizon?

With the assumptions factored in, the price to mine one BTC, with an increasing hash rate looks to set in at $15,062. Once the research adjusts for the assumption on hash rate, and assume hash rate stays nearly flat from current levels then the cost to mine one bitcoin would fall to $12,525. However, one thing remains clear, the price of BTC needs to kick up to prevent a miner’s capitulation.

Well according to TradeBlock’s director of digital currency research, John Todaro, miners are the biggest determinants of the cost they may operate on if the prices do not rise accordingly. He said,

“It’s very helpful to know what the miners are thinking, what the miners are doing. There might be some miners that are profitable at those levels, but not a lot of miners are going to be operating at a loss, and they might take their rigs offline.”

Latest Bitcoin Price News and Crypto Market Updates

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Author: Lujan Odera

Retail And Institutional Investors in Agreement Over Bitcoin’s $10,000 Price

  • The trading volume of CME Bitcoin futures contracts is now pushing to new highs
  • A strong rise in open interest as well, Bakkt’s reaching for ATH
  • Bitcoiners to make up 30-50% of the world’s financial elites

Bitcoin is holding strong in 2020. We are just over a month into the year and the crypto market has been flying.

BTC is up over 33% YTD while trading at $9,775. Volume on spot exchanges is maintaining its momentum and keeping above $1 billion.

Among the regulated crypto exchanges, trading volume for CME Bitcoin futures contracts is now pushing to new highs. The 7-day average volume went above $600 million last week, the highest since the bitcoin price topped last summer at $13,900. January recorded an increase of more than 250% in daily volume.

There has also been a strong rise in open interest for CME’s bitcoin futures contracts. Just like CME, Bakkt‘s BTC Futures Open Interest has also reached a new all-time high.

Retail, however, still dominates the derivatives market for bitcoin as crypto derivatives platform BitMEX manages a daily trading volume 10x the size of CME.

Bitcoin Already Trading Above $10,000

Bitcoin is looking ready to break the $10,000 barrier in the spot markets soon but the futures market, however, is already trading above this level.

In the futures market, for the first time in several months, retail and institutional investors are in agreement. While CME bitcoin futures trading above $10k, BitMEX’s June futures are trading above $10,150. The premium rates for March contracts also keep on rising.

Still Far From The Dot Com Bubble Equivalent

Another bullish figure can be seen in the Bitcoin being bought by institutional investors. Last year, over $400 million worth of BTC was bought from Grayscale’s Bitcoin Trust (GBTC). These GBTC shares also trade on a premium, currently at 11.7 for ownership of 0.00097 BTC. These coins also have a lock-up period of 1 year.

As of Feb. 7, a total of 283,192 BTC are in GBTC, holding close to 2% of all BTC supply minus the lost coins.

With the demand side strong and supply to take a shock with the upcoming halving, the sky’s the limit for Bitcoin.

As Hodlonaut notes, “The scarcity of Bitcoin has not even begun to be understood yet. It will deliver many hard lessons in the years to come.”

This also means, “The equivalent of the Dot Com bubble of 1999 hasn’t happened to Bitcoin yet. We’re still in 1992,” says analyst Misir Mahmudov.

Bitcoiners To Make Up 30-50% Of The World’s Financial Elites

For some this scope could be as high as $1 million. If Bitcoin does surge to that level, that would give 100k bitcoiners “Ultra High Net Worth Individual” status.

“With worldwide UHNWIs projected at only ~200k by 2022, this means the Bitcoin 1% could by then make up 30-50% of the world’s financial elites,” hypothesis Tuur Demeester.

Currently, Hong Kong, New York, and Singapore have the highest density of the ultra-high net worth individuals but with Bitcoin’s another parabolic rise this dynamic could take a drastic shift. Interestingly, Forbes’ 2019 rich list was dominated by the people from the technology industry.

With Bitcoin already being the best performing asset of the decade with a nine million percent increase in the 2010s, rise to the moon won’t be unprecedented for this asset class.

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Author: AnTy

NEXO Introduces 50% Interest Discount on Instant Crypto Credit Lines to Reduce Supply

  • NEXO’s utility features will now show a significant rise with the Discounted Interest of 50% on its Instant Crypto Credit Lines, using the Nexo Token.
  • The company is hard at work on the Utilities 2.0 Overhaul of their NEXO Token with a goal of bringing a host of new utility features.

NEXO will begin to execute a new improved policy of the 50% Interest Discount on its Instant Crypto Credit Lines, starting February 10th, announced the company on Wednesday. With the upgrade, the company says NEXO holders will see gains as “NEXO Token will experience a notable boost in its utility features.”

To collect the whole 50% discount, the company says customer’s wallets need to have sufficient Tokens to “cover the interest for the entire period from the moment of withdrawing funds from the credit line up to their desired moment of repayment.”

Customers that own staked NEXO Tokens for only a portion of the length of their loan, will collect on the discount that corresponds with the amount of days.

Customers that would like to benefit from the new Discount can also now use, NEXO, AUD, Stellar, USD, EOS, Bitcoin, as well as Bitcoin Cash, GBP, Ether, Litecoin, XRP, EUR and with all major stablecoins, with more assets coming soon for making repayments using all the assets accessible on the platform.

NEXO Token Holders Benefits

With the new changes, the company says it was designed to benefit the customers and owners of the tokens. Apart from providing the entire 50% Discount from the staking of their tokens, it allows holders to collect higher dividends.

Already, the company says it has allocated more in profits than all others in the blockchain ecosystem. Its dividend yield NEXO says has reached an “impressive 12.73%,” that surpasses “each of the highest dividend-paying stocks in the S&P 500.” Also, this “balances market volatility and results in a higher, more stable demand for NEXO Tokens.”

The company further says this upgrade will help in all long-term investors confidence by attracting customers to stake their NEXO Tokens over longer periods, which will lower the available market supply.

The 65th largest cryptocurrency currently has 560,000,011 NEXO tokens in circulating supply. At the time of writing, NEXO/USD has been trading at $0.139897 with 24 hours gains of 3.56%. If the supply of NEXO gets reduced while demand either stays the same or increases, the price is expected to take a jump.

Meanwhile, NEXO is planning further improvements and is working on revamping the NEXO Token Utilities 2.0, which can quickly usher in several utility features including higher Nexo card cashback, higher affiliate commissions, and better interest rates on both our ‘Instant Crypto Credit Lines’ and ’Earn Interest’ products.

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Author: AnTy