There were heavy gains in bitcoin price above the $5,500 pivot and resistance level against the US Dollar.The price rallied above the $5,700 and $5,800 resistance before there was a minor downside correction.There is a key connecting bullish trend line in place with support at $5,610 on the 4-hours chart of the BTC/USD pair (data feed from Kraken).The pair is currently in a strong uptrend and it could trade towards the main $6,500 resistance level.Bitcoin price gained significantly above the $5,600 level against the US Dollar. BTC is likely to break the $6,000 and $6,250 levels before it could start a substantial downside correction.Bitcoin Price Weekly Analysis (BTC)This past week, there was a significant upward move in bitcoin price above the $5,380 and $5,400 resistances against the US Dollar. The BTC/USD pair broke the $5,500 pivot and resistance level to move into a bullish zone. The bulls gained traction, resulting in a push above the $5,600 and $5,700 resistance levels. There was a clear break above the 76.4% Fib retracement level of the major drop from the $5,645 high to $4,929 swing low. The price settled well above the $5,600 level and the 100 simple moving average (4-hours).Finally, the price broke the $5,700 level and the last swing high. A new 2019 high was formed near $5,838 before the price started a downside correction. It seems like the price faced a strong resistance near the $5,820-5,840 zone. It represents the 1.236 Fib extension level of the major drop from the $5,645 high to $4,929 swing low. The price corrected below the $5,700 level, but dips remain well supported (as discussed yesterday). As a result, there was a strong comeback and the price surged back above $5,700 and $5,750.The price is still trading below the last swing high and resistance near $5,820-5,840. A convincing break above the $5,820-5,840 zone is likely to set the pace for more upsides above $6,000. The price could even break the $6,250 level and trade towards the main hurdles at $6,400 and $6,500. It won’t be easy for the bulls to clear the $6,500 level since it is a major pivot zone and previous support area. Therefore, there are high chances of a major downside correction if the price test $6,400 or $6,500.Looking at the chart, bitcoin price is clearly placed in a strong uptrend above $5,600. There is also a key connecting bullish trend line in place with support at $5,610 on the same chart. Therefore, dips could still be contained and the price could rally above $6,000.Technical indicators4 hours MACD – The MACD for BTC/USD is about to move back in the bullish zone.4 hours RSI (Relative Strength Index) – The RSI for BTC/USD is placed well above the 50 and 60 levels.Major Support Level – $5,600Major Resistance Level – $5,850
Archives for May 4, 2019
ETH price started a steady rise above the $158 and $160 resistance levels against the US Dollar.The price traded above the $165 level and recently corrected lower below $165.There is a major contracting triangle in place with resistance near $167 on the 4-hours chart of ETH/USD (data feed via Kraken).The pair is likely to climb higher in the near term towards the $170 or even $180 level.Ethereum price remains in a decent uptrend versus the US Dollar, but in downtrend against bitcoin. ETH is struggling to follow BTC’s rise, but it may soon climb higher.Ethereum Price Weekly AnalysisThis past week, Ethereum price formed a decent support base above the $150 level against the US Dollar. The ETH/USD pair started an upward move after bitcoin price started a strong rise above $5,500. There was a strong wave above the $155 and $156 resistance levels. The price even broke the $160 level and settled above the 100 simple moving average (4-hours). The bulls pushed the price towards the $170 level, where sellers emerged.As a result, there was a downside correction below the $166 and $165 levels. The 50% Fib retracement level of the last wave from the $154 swing low to $169 swing high was breached. Ether price tested the $158-160 support area, where the bulls protected more losses. It seems like the 76.4% Fib retracement level of the last wave from the $154 swing low to $169 swing high acted as a support. More importantly, the price is still above $160 and the 100 simple moving average (4-hours).There is also a major contracting triangle in place with resistance near $167 on the 4-hours chart of ETH/USD. If there is an upside break above the $165 and $166 levels, the price is likely to grind higher towards the $169 and $170 levels. Above the $170 swing high, the price is likely to rally towards the $180 level. On the other hand, if there is a downside break below the $158 support, the price could start another drop to $150.The above chart indicates that Ethereum is trading above a few important supports near $158. Besides, as long as the price is above the 100 SMA, there are high chances of an upside break above $170 and $172. The main target for the bulls could be $180, where sellers are likely to defend a run towards the $200 level.Technical Indicators4 hours MACD – The MACD for ETH/USD is currently slowly moving in the bearish zone.4 hours RSI – The RSI for ETH/USD recently moved back above the 50 level, with a positive angle.Major Support Level – $158Major Resistance Level – $166
On Saturday, reports revealed that Bitfinex, one of the largest crypto exchanges in existence, unveiled official plans to sell $1 billion worth of an asset called LEO. While this seems innocuous, a leading analyst warns that it could be a detriment to Bitcoin (BTC).Related Reading: Bitfinex Premium Continues To ‘Rally’ Even After Bitcoin (BTC) Stabilizes, Tether Fears SubsideBitfinex To Sell $1B Worth Of LEOAs reported by NewsBTC previously, last week, Dovey Wan, the founding partner of Primitive Ventures, revealed that Bitfinex was planning to raise $1 billion through the sale of company-branded crypto tokens through an on-platform initial coin offering, more commonly referred to as an IEO. Some took this news, however, as a joke, noting that there’s no way that the Hong Kong-headquartered exchange would enlist such a strategy, especially after last week’s news that it is in precarious legal and financial standing.Bitfinex Official document about the LEO token pic.twitter.com/YR5FdS4iUY— Dong Zhao (@zhaodong1982) May 4, 2019Per a document published by Chinese cryptocurrency investor Zhao Dong, first reported on by The Block, however, the IEO is entirely legit. As Wan revealed, Bitfinex does intend to sell $1 billion of the cryptocurrency. Funnily enough, however, Larry Cermak of The Block has said that $600 million of the funding round has already been allocated to private investors, reported to be industry insiders, Bitcoin whales, and Asian venture capital firms.On the matter of the token itself, the document hinted that LEO may be very similar in use to Binance Coin (BNB). More specifically, Bitfinex will purportedly spend up to 27% of its monthly profits to purchase LEO tokens, acting somewhat as a dividend for holders. It was also stated that if the exchange gets the $850 million it is owed back from Crypto capital, a Panamanian crypto-centric payment processor that is currently in the middle of an intense legal debacle, and the thousands of Bitcoin lost in a historical hack, Bitfinex will be able to buy back LEO with most of that capital.Utility-wise, LEO can be used to reduce the rates they pay on the crypto exchange’s market. Taker fees for crypto-to-crypto pairs, lending rates, and withdrawal fees will all purportedly be subsidized for LEO holders.Negative Bitcoin Price Action CatalystWhile this news seems to be independent of the broader cryptocurrency market, Tom Lee, Fundstrat’s head of research, has postulated that this $1 billion raise could actually be a negative price action catalyst for Bitcoin. The prominent commentator explains that $1 billion worth of new tokens will have a negative impact on BTC and other digital assets, as the market needs to “absorb” an influx of LEO tokens.As Lee notes, “Bitcoin miners sell $7mm per day, so a $1 billion IEO is essentially 142 days worth of miner selling taking place in one day.”$1 billion IEO is a lot of “new” token supply and probably has a short-term negative impact on $BTC #bitcoin and other crypto as the market needs to absorb this supply……Unless all the purchasers of the IEO come are new to crypto (fiat to crypto), which makes less sense. https://t.co/no9LlN0yJQ— Thomas Lee (@fundstrat) May 4, 2019Lee, however, seems to be leaning bullish overall, despite the news regarding LEO. Per previous reports from this outlet, the Fundstrat co-founder remarked that the fact that BTC has rallied despite the Tether “FUD” might just be an early sign that “crypto winter is ending.” He adds that if Bitcoin continues to hold strong, failing to react to the constant inundation of Tether-related news for two more weeks, he “would be inclined to argue that this is [another] reason [why] crypto winter is over.” This isn’t the only development making the analyst bullish, however.During a recent CNBC segment, Lee took a gander at blockchain statistics, specifically that of Bitcoin. He opined that the transactional value of on-chain transfers has turned positive on a year-over-year basis, signifying that BTC is still seeing constant use for its intended purpose, in spite of the brutal conditions in the market. What’s even more positive is the fact that average daily transactions processed on the Bitcoin chain are reaching near-all-time highs, but that the transaction fee market has yet to bubble notably.Secondly, the long-standing cryptocurrency optimist looked to the fact that BTC has moved above and held on top of its 200-day simple moving average. Throughout Bitcoin’s history, and the history of other liquid, tradable assets, the aforementioned technical level has been seen as a kind of ‘make or break’ point, in that holding above it signals that bulls have the upper hand. Combine this with the fact that Bitcoin’s daily chart recently printed a golden cross, which saw the 50-day simple moving average cross over the 200-day, is another reason, in Lee’s eyes, that “spring” might finally be inbound for digital assets across the board.Lastly, and arguably most importantly, is the growth in trading activity in cryptocurrency markets, especially over-the-counter (OTC) desks. Citing closed-door conversations, Lee explained:“We surveyed OTC brokers, who are really important in facilitating institutional investors, and they’ve all talked about a 60% to 70% increase in activity/number of clients and trading volume per client. Fundamentals are improving; technicals are improving, and activity by HODLers too.”Featured Image from Shutterstock
By CCN: ‘Reported volume’ is the default metric that people look for when determining the ranks of crypto exchanges. ‘Reported’ and ‘adjusted’ volumes wildly differ on sites like CoinMarketCap.com. For example, if you look at the image below, you’ll notice a wild difference in “reported” and “adjusted” volumes at press time.
Ranking Exchanges Beyond Their “Volume”
ViewBase, a “market insights and community” platform centered around cryptocurrency, recently published a report which details other ways we might rank exchanges. Rankings could be based on real facts, like how much crypto they hold or the value of all their tokens combined.
The platform watches for large movements of various coins, including stablecoins, and provides traders the opportunity to discuss observations. It’s a bit like TradingView but crypto-centric.
Ranking exchanges purely by volume – reported or otherwise – may soon be a fallacy in and of itself, as the trend of “initial exchange offerings” gives rise to more “transaction mining.” Transaction mining is where users earn tokens for making trades; this may increase the volume but does it mean the exchange is more significant?
Three New Ways to Objectively Rank Exchanges
So ViewBase looks at three new ways to rank exchanges.
The first way is by ether balances.
Kraken, with nearly 3 million ether, by far has the deepest pockets. Kraken’s volume in ether is interestingly currently ranked No. 98, with less than 1% of Ethereum’s alleged daily volume of more than $7.4 billion.
Binance Crushes With Help from BNB
The next metric ViewBase uses is the value of all ERC-20 tokens combined, which drops Kraken way down the list being that Kraken primarily focuses on fiat/major-cap markets.
Binance, however, gets a huge boost thanks to all its tokens. Huobi is right behind it. ViewBase writes:
“A vast majority of Initial Coin Offering (ICO) tokens are issued on the Ethereum blockchain, ranging from established projects like Omisego to the latest IEO tokens like Fetch.AI and Celer. Hence it is reasonable to expect the valuation of ERC20 tokens deposited on an exchange to be reasonably proportional to its reported trading volumes.”
The last metric is the value of all Ethereum and all tokens combined.
This chart surprisingly brings Kraken back into the top 5, but Binance remains king – by a long shot.
If we’ve learned anything from all the fake volume scandals over the past year, it’s that volume is not necessarily the best way to judge an exchange. While it’s an important metric, especially for traders who require a lot of liquidity, there is a lot more to exchanges than the number of times tokens change hands.
The actual crypto holdings of exchanges are perhaps the most exciting takeaway here. On the one hand, it’s a scary situation that a few places control that much crypto – “not your keys, not your crypto” comes to mind. On the other, it’s a real testament to the level of trust people place in these companies.
By CCN: Go right ahead lefties with your monetary policies. You’re rallying crypto bulls. And you right leaners who are calling for lower interest rates are as good as gold for crypto, too.
That’s the message from former hedge fund manager Michael Novogratz. The bitcoin bull weighed in on monetary policies being bandied about that are essentially making the case for crypto. Novogratz is the CEO of cryptocurrency merchant bank Galaxy Digital.
In a tweet this weekend, he pointed to calls for interest rate cuts being made by Vice President Mike Pence as well as former Fed contenders Stephen Moore and Herman Cain. While nominated by Trump, Moore and Cain eventually withdrew their names from consideration.
Then there’s the controversial Modern Monetary Theory (MMT) that Rep. Alexandria Ocasio-Cortez has proposed as a way to fund her Green New Deal. She is the gift that keeps on giving. For the crypto space, her push for MMT does just that.
This makes me more bullish Bitcoin. Stephen Moore, Herman Cain, and Mike Pence all make me bullish hard money. To be fair, MMT and some of the far left’s policies also makes me bullish crypto. https://t.co/BdKCUUnhEX
— Michael Novogratz (@novogratz) May 4, 2019
To Cut or Not to Cut
The Federal Reserve decided to leave interest rates unchanged last week. This was disappointing to Pence and others who see the strong economy as one reason rates should be cut. Pence recently told CNBC:
“I think it might be time for us to consider lowering interest rates. We just don’t see any inflation in this economy at all. We’re seeing jobs being created all over the country; that should be an encouragement to every American and also to people that operate our monetary policies.”
President Trump sharply criticized the Fed’s move last December to raise rates. He, along with his administration’s economic adviser Larry Kudlow and Treasury Secretary Steven Mnuchin, has long championed lower interest rates.
The constant worry is, “what happens when there is a recession?” The Federal Reserve’s toolbox that includes quantitative easing (QE) may not do the trick to stop the bleeding from a slowing economy.
Bring It, MMT Zealots
The basic idea behind MMT is that a government that issues its own money can never fail to meet its obligations because it can simply print money to cover them.
However, critics of MMT charge it could result in an inflationary spiral. The policy doesn’t account for a scenario where too much money chases too few goods causing inflation. Governments would have to raise taxes to suppress inflationary pressure.
The policy began making headlines this spring when Ocasio-Cortez started pushing it to pay for her $93 trillion Green New Deal. As reported by CCN, the idea, which has been regarded as a borderline lunatic one, is making a serious comeback into the political and economic conversation.
Still, it may be the future of US economic theory, said hedge fund manager Ray Dalio, the founder of Bridgewater Associates, the world’s largest hedge fund.
That’s just fine for crypto bulls like Michael Novogratz.
The crypto markets have dipped as they head into the weekend after incurring a significant amount of upwards pressure throughout this week. The latest drop has put Bitcoin (BTC) back into the $5,600 region, signaling that the cryptocurrency’s bulls don’t have enough buying pressure to propel the crypto above $5,800.Now, analysts believe that the crypto markets may continue dipping lower before they hit a price level at which they can continue surging higher.Bitcoin Drops Into $5,600 RegionAt the time of writing, Bitcoin is trading down over 2% at its current price of $5,675, down from its daily highs of nearly $5,900 which were set yesterday.Prior to today’s dip, analysts were closely watching the $6,000 level to see if the crypto would be able to break into this price region, with some analysts claiming that a decisive move into the $6,000 region would mark the start of the next bull market.Big Chonis, a popular crypto analyst on Twitter, shared his thoughts on Bitcoin’s current price action in a recent tweet, explaining that BTC’s previous daily resistance is now acting as support, which may be a bullish sign.“$BTC – Don’t get too bearish just yet, as previous daily resistance is being tested as #bitcoin support… a break of the $5,300 area would be a bit more worrisome that a larger correction is taking place,” he explained.$BTC – Don’t get too bearish just yet, as previous daily resistance is being tested as #bitcoin support… a break of the $5,300 area would be a bit more worrisome that a larger correction is taking place… pic.twitter.com/r1MbAWQ5ke— Chonis Trading-⚔️ (@BigChonis) May 4, 2019BTC May Dip Lower Before Breaking Above $6,000Although it is clear that Bitcoin isn’t quite ready to move into the $6,000 region, today’s dip may not be low enough for the crypto to garner any significant buying pressure that allows it to continue surging higher.Peter Brandt, a celebrated analyst who covers a variety of assets and markets, spoke about Bitcoin in a recent tweet, saying that its recent highs may be a top that leads it to fall towards lower before it incurs enough buying pressure to propel it towards $6,500.“Just an opinion — there is a chance $BTC is topping here, having met its price target at key resistance. A correction could occur before another move toward 6500, then a more significant correction,” Brandt explained.Just an opinion — there is a chance $BTC is topping here, having met its price target at key resistance. A correction could occur before another move toward 6500, then a more significant correction. pic.twitter.com/woetnihqB5— Peter Brandt (@PeterLBrandt) May 4, 2019As the weekend continues on and traders gain a better understanding of how secure Bitcoin’s current position within the mid-$5,000 region is, it will likely become clearer as to whether or not a move to above $6,000 is in the cards in the near-future.Featured image from Shutterstock.
By CCN: Tim Draper appears to love anything that gives power back to the people. An eye-catching tweet on Saturday regarding email spam solution BitBounce is sure to generate a good deal of interest in this project. Draper sees this as a potential play on crypto mainstream adoption given its immediate real-world use case. He is named as an investor in the project.
— Tim Draper (@TimDraper) May 4, 2019
BitBounce Pays in Credo
The low-key project has already amassed an impressive 4 million users. They are looking to solve a wide-spread problem that affects everyone. Who doesn’t have an email address filled with irritating emails from spam marketing? Microsoft outlook attempted to fix this issue with “Focused” and “Other” email categories, but that is just putting a band-aid on the problem.
BitBounce pays in the Credo cryptocurrency and lets users monetize their private information. If you see spam emails, you can sure that the senders paid you to be there and you are not lining someone else’s pockets. The Credo cryptocurrency is small but it shot up 9% today while the broader crypto market was trading in the red.
Draper’s Bitcoin Enthusiasm Sometimes Detracts From His Noble Intentions
Tim Draper might get a bad rap for being a bit too enthusiastic sometimes, but there is no question about the sale-ability of BitBounce to a mainstream audience.
He is a famous cryptocurrency enthusiast who wants to bring bitcoin to the masses. Far from being perturbed by crypto winter, he still firmly believes that the blockchain is the future. Draper made his views clear in a recent interview with the Lujiazui Financial Network. He made a bold claim that bitcoin is a better currency than both the U.S. dollar and the Chinese renminbi alongside his usual bullish forecast for BTC/USD.
“Yes, $250,000 by 2022 or 2023. But it’ll be in that time frame. Yes, because bitcoin is just a better currency; it’s better than the renminbi and it’s better than the dollar. It’s certainly a lot better than the Argentine peso or the Nigerian naira. Those dropped 50% a year every year. So it’s a lot better than those.”
Tim Draper Clarifies His Bitcoin $250,000 Statement
Given that the U.S. dollar is the most used medium of exchange around the world by far, Draper’s bold claim is extraordinary. Many people have documented the scalability issues that bitcoin would face in a mass-adoption scenario. Clarifying precisely why he believes that 2022 or 2023 is the date for his prediction to land, he explained:
“I think a lot of the engineers need a couple of years to do the development work to get to the point where you and I can just take our bitcoin and buy coffee with it.”
Tim Draper loves making bold claims like bitcoin is better than the US Dollar or that it will hit $250,000. What is more interesting, is when he brings our attention to smaller projects like BitBounce. While not everyone might have heard of the company yet, its a tremendous concept and it’s no surprise that it is associated with Draper.
For some reason or another, Bitcoin (BTC) has continued to rally into Saturday. As of the time of writing this, the crypto asset is trading at $5,725 on most major exchanges, while altcoins have begun to play catch-up.While some fears that this rally is unsustainable, especially with the debacle that both Bitfinex and Tether are both going through, analysts have kept a bullish tone across the board.Bitcoin Could See A Further Move HigherAccording to David Puell, the head of research at Adaptive Capital, Bitcoin’s chart is currently showing an array of bullish signals, both in terms of technical indicators and pure price action.In a simple chart posted on Friday night, the investor remarked that Bitcoin is currently trading in a broadening ascending wedge, a pattern defined by legendary chartist Bulkowski as a catalyst for bullish continuation. Bitcoin Bravado’s Jack, who noticed this pattern alongside Puell, remarked in his own tweet that such wedges are often never seen in bear markets, and are instead, a reversal pattern that commences a bull run.$BTC: I am scared to bid this insanity, but…Le long… le long… pic.twitter.com/EqgQmSBwYY— David Puell (@kenoshaking) May 4, 2019But according to Puell, this isn’t the only bullish sign. He looks next to volume, which has been on the decline since April 1st’s boom past $5,000 but has begun to recover with Friday’s uptick. Remarking on Friday’s volume candle, he writes “Ce n’est pas mal!”, which for those not versed in French, means “this is not bad.” Indeed, a notable amount of trading activity signals that stronger movements can be seen.Related Reading: Prominent Analysts Divided Over Bitcoin Bottom: Let’s Look At The Two SidesNext, the Adaptive Capital partner, who works alongside prominent crypto analyst Murad Mahmudov noted that the lack of resistance and sell orders in the $5,700 to $5,850 range may soon allow Bitcoin to move to that level.And last but not least, Puell points to the fact that the Relative Strength Index (RSI), Chaikin Money Flow (CMF), and On-Balance Volume (OBV) readings, which all measure if an asset is either technically overbought or oversold are currently breaking to the upside. Puell didn’t give an explicit short-term prediction, but it is clear that he doesn’t intend to short BTC at the moment.And he isn’t the first to think so. In a tweet posted Thursday, Peter Brandt, a legendary commodities trader with decades in the biz, revealed that Factor’s benchmark moving average for Bitcoin’s weekly chart has begun to trend higher. The last time such an event was seen was when BTC “began its move from $340 to $20,000.”It is important to note that last time Factor’s moving average reversed from a downtrend, BTC was susceptible to one more pullback before embarking on the aforementioned parabolic run.The last time Factor’s benchmark weekly MA was in the current profile of turning from down to up was in Nov 2015 just as $BTC began its move from $340 to $19,800. pic.twitter.com/uFJSkV9NwM— Peter Brandt (@PeterLBrandt) May 2, 2019But will historical action be indicative of future performance? At this point, crypto diehards can only hope.Featured Image from Shutterstock
In what has already proven to be an extremely challenging 12 months for Coinbase is shows no signs of respite. The crypto exchange’s CTO announced his departure following roughly one year in the spot.
Balaji Srinivasan broke the news on his Twitter account. He also thanked his “friend” Coinbase CEO Brian Armstrong for the opportunity.
1/2 Really enjoyed my time at Coinbase working with my friend @brian_armstrong. The Earn integration was successful and we’ve closed ~$200M in deals for the new Coinbase Earn. Was also my privilege to help with shipping new assets, launching USDC, & getting staking/voting going.
— Balaji S. Srinivasan (@balajis) May 4, 2019
The exit is surprising. Srinivasan originally joined Coinbase following the exchange’s acquisition of Earn.com. Now rebranded as Coinbase Earn, the program allows users to earn extra cryptocurrency by watching educational videos about new coins and tokens and then answering questions via related skill quizzes. It’s been one of the few things going right for Coinbase.
During Srinivasan’s short tenure at Coinbase, the exchange has been busy. They supported the launch of stablecoin USDC, bolstered the number of ERC20 tokens on Coinbase Pro, and expanded staking services on Coinbase Custody, a platform specifically aimed at institutional investors.
Nevertheless, Srinivasan isn’t the first Coinbase executive to depart. Dan Romero, head of Coinbase Institution, announced he was leaving last month. Furthermore, Christine Sandler left to become head of sales and marketing at Fidelity.
Who’s next, Brian Armstrong?
Love or Hate Coinbase…
For many, Coinbase was the first port of entry into cryptocurrency. During the early growth stages and right through the bull run of 2017, it was the primary exchange for a wide swath of new retail investors seeking to purchase cryptocurrencies for the first time.
The simplicity of the exchange and user-friendly interface meant users had strong confidence in the platform. During this time Coinbase listed five cryptocurrencies: Bitcoin (BTC), Ethereum (ETH), Litecoin (LTC), Bitcoin Cash (BCH) and Ethereum Classic (ETC). The exchange has since expanded to include more coins.
In March, Coinbase announced the acquisition of Neutrino, a blockchain analytics intelligence project. The deal exploded into a massive PR nightmare for the exchange after it was discovered that Neutrino had ties to the scandalous Hacking.com that worked with authoritarian governments. The exchange’s tone-deaf decision to proceed with the purchase of Neutrino didn’t go over well in crypto land. An online movement ‘#DeleteCoinbase spread like wildfire through Twitter and other social media platforms, encouraging Coinbase customers to delete their accounts.
YOU DID WHAT?!?!
And that’s why we should trust the people you choose to do business with?!?! https://t.co/XBb3ncHmxI
— Udi Wertheimer (@udiWertheimer) March 3, 2019
Brian Armstrong acknowledged the mistake, releasing the Neutrino members in question. But the damage was done. There was much disillusionment at how a pillar of the crypto and blockchain world could ignore its moral compass and fail to sense right and wrong.
Back to Basics
The unicorn startup was recently valued at $8 billion, but the future is a lot less clear for Coinbase these days. The reputational damage from the Neutrino fiasco continues to linger, and the exchange is projected to have generated 60% less revenue in 2018 than initially hoped. Bloomberg reported the exchange expected to generate $1.3 billion, but according to a report by Reuters, the actual number was closer $520 million.
Adam Draper, the son of famous venture capitalist Tim Draper, is an early backer of Brian Armstrong’s company. And the exchange has arguably done more to onboard crypto investors than any other company in the space. Maybe it’s time for Coinbase to get back to basics.
It’s no secret that Warren Buffett – otherwise known as the Oracle of Omaha – is no fan of Bitcoin and crypto, as he has consistently offered scathing critiques of the nascent industry, frequently affirming his position that BTC is not an investment.During the recent Berkshire Hathaway annual shareholder meeting at the CHI Health Center in Omaha, Nebraska, Buffett was once again asked to share his thoughts on BTC, this time calling it a “seashell” and saying that it “doesn’t do anything.”Warren Buffett Doesn’t Seem to Understand Bitcoin Bitcoin and crypto are undoubtedly complex pieces of technology that take either a significant amount of research or a solid-base line understanding of computer science to understand. That being said, younger generations are naturally more apt to accept it as the future, while older generations continue to disregard it as a speculative tool used by criminals.While speaking to a group of reporters at the shareholders meeting, he referred to BTC as a “gambling device,” referencing the fraud that has occurred in the markets as a reason for why it shouldn’t be considered an investment product.“It’s a gambling device… there’s been a lot of frauds connected with it. There’s been disappearances, so there’s a lot lost on it. Bitcoin hasn’t produced anything,” he said.Although it is true that there has been a significant amount of fraudulent activity in the crypto markets, that is simply a result of the fact that it is a new digital frontier – similar to the wild west – that lacks significant regulation, but this is quickly changing.Another interesting simile that Buffett used to describe Bitcoin was saying it is “like a seashell.”“It doesn’t do anything. It just sits there. It’s like a seashell or something, and that is not an investment to me,” he added.BTC is Like a “Button on My Jacket”Although a seashell may be a pejorative way to describe Bitcoin, Buffett also compared BTC to a button on his jacket, which further shows that he simply doesn’t understand the merits of the technology, including its ability to facilitate rapid global transactions, its decentralized nature, and the store of value it offers.“I’ll tear off a button here. What I’ll have here is a little token…I’ll offer it to you for $1000, and I’ll see if I can get the price up to $2000 by the end of the day… But the button has one use and it’s a very limited use,” he said, signaling that his knowledge of the crypto is severely lacking.Regardless of what Buffett says, as more major corporations – including the likes of Facebook – begin foraying into the industry, the use cases for the rapidly evolving technology will only become clearer and naysayers will, hopefully, be proven wrong.Featured image from Shutterstock.