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93% of Bitcoin is Profitable; How Are the Bitcoin Miners Reacting?

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Bitcoin is in a state of euphoria over the last few days. The largest digital asset was finally able to overcome its psychological resistance at $10,000 and, at the moment, the asset has sustained a position above the range for more than 24 hours. With Bitcoin ‘s valuation taking a huge step forward, the impact has also transcended its on-chain fundamentals.

bitcoin supply

According to Glassnodes’ weekly report, Bitcoin Global on-chain metric index improved by 8 points, taking up its score to 70 in the charts. Liquidity made minor gains whereas Market Sentiment was brimming high with confidence, registering an improvement of 34 points over the past week.

93% of Bitcoin Supply is in state of Profit

bitcoin exchange net flow

After breaching past the $10k mark, the report suggested that the percentage of BTC supply that was in profit had risen up to to 93%. Only 11 percent of the current supply, if taken out would incur a loss and such a situation was driving the speculators out of the picture.

bitcoin

As observed in the above chart, the improved profitable holdings in Bitcoin were leading towards an increased inflow of BTC to exchanges. It is fairly obvious that users were making the most of the situation, as they were trying to cash when their profitability was on a high after months of stagnation. The desire to sell was quite high as the net flow witnessed by exchanges registered a new high over the past couple of months. The report said,

“After months of bitcoin flowing out of exchanges, the net flow is now seeing its largest hourly spike in over 3 months.”

BTC Miners refusing to Budge

Now, in spite of the high profitability of the BTC supply, Bitcoin miners pictured a surprisingly adamant behavior.

bitcoin minor outflow volume

When Bitcoin appeared to drop back in May, fears of miner capitulation was quite high as analyst expected that whenever Bitcoin reaches past $10,000 again, the miners are most likely to capitalize on the profits.

However, that hasn’t been the situation at the moment. The chart above illustrates that Miner Outflow Volume for Bitcoin has been keeping low in the charts, which suggested underlying confidence in Bitcoin’s potential.

With Miners standing firm in the industry, there is a sense of optimism surrounding BTC at the moment, as the largest digital asset enjoyed its lucrative rally.

China based Ebang International to Expand into Establishing Offshore Cryptocurrency Exchange

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The spread of coronavirus has resulted in catastrophic consequences all across the planet, with several companies and organizations feeling the pinch. Cryptocurrency companies have also begun to diversify their portfolios in order to ensure their survival in the coming months.

Chinese cryptocurrency Miner Producer Ebang International Holdings Incorporated was the latest company to offer new services in the midst of a raging pandemic. Ebang claimed that an offshore exchange for digital assets would be launched in the third quarter of 2020 with the hope of expanding out of the Bitcoin ecosystem.

According to sources close to Ebang, the move would help dabble in a sector that was independent of the highs and lows of Bitcoin. Mining companies like Ebang generally depend on price variations for large cryptos like Bitcoin, which is not always a sustainable model. These companies only make a profit when the price of crypto is rising on a bullish ramp.

At the time of the press, Bitcoin traded for $9222.4 with a total market cap of $169.88 billion. A 0.65 percent price increase over the previous 24-hour lifted the daily trading volume to $15.99 billion. This stagnant price increase does not make much of a profit for a large company like Ebang Holdings. New reports on the Hangzhou-based rig maker showed that the new expansion rates could increase the revenue stream by 40%.

Ebang also plans to set up a crypto exchange outside the mainland of China, a road map for which it is still under construction. In a recent interview, Ebang Chief Financial Officer [CFO] Chen Lei stated that foreign exchange could contribute at least 10% to the current revenue stream. Despite new developments, Ebang registered a 14 percent drop in its IPO pricing, raising more than $100 million.

The company reiterated that its services would help counter Bitcoin’s volatility in the wake of the currency’s wild move over the past year. Ebang recorded gross revenue of $109 million in 2019, which is expected to exceed that benchmark by 2020. This predicted spike comes at a time when rivals like Bitmain and Canaan were focusing on a blend of AI and physical technology.

Ebang International also plans to list Nasdaq under the EBON symbol. AMTD Global Markets, Loop Capital Markets and Prime Number Capital are proposed to act as project lead managers.

Ethereum’s Josep Lubin Dives into Compliance; Consensys Develop Product for DeFi

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Consensys, an organization providing solutions to Ethereum(ETH) based blockchain applications is ready to launch a compliance service that will assist various exchanges and decentralized finance (DeFi) projects to analyze and keep track of trading activities on Ethereum.

According to Bloomberg, Joseph Lubin, co-founder of Ethereum(ETH) and head of Consensys, indicated that the company is looking forward to developing a product that would focus on the regulatory requirements of the know-your-customer, which has been a significant hurdle for various digital asset firms.

Compliance services have been a major issue in the past as the lack of standardized rules has led to various illegal activities in the industry. In order to avoid various money laundering transactions, various cryptocurrency firms have to rely on analytical firms such as Chainalysis and CipherTrace to identify users and tokens that are linked to criminal activity.

Lex Sokolin, ConsenSys’s global fintech co-head said,

“There are more and more people building decentralized apps that need this as a Lego piece. What we are trying to do is make activity on the decentralized financial infrastructure much more safe, transparent, much easier to trace.”

Since Consensys is focused on Ethereum, the new services launched by the organization would track up to 280,000 different tokens, those which are built on the ERC-20 or ERC-721 standard. According to their press release, the objective remains to implement a more stable and regularised compliance in crypto, usually tagged with the traditional payments sector.

Ethereum(ETH) continues to be the development Hub

It is hard not to pin-point that the entire system continues to under Ethereum. Sokolin has mentioned last year that the improvement of the DeFi space in terms of functionality and now, compliance is highly important for the ever-improving space of Ethereum. When the number of unique numbers rose nearly up to 530 percent in 2019, according to DappRader report, Sokolin had stated,

“Providing robust AML/CFT compliance for Ethereum-based digital assets is a keystone step in bringing the institutional financial industry to decentralized finance. Code Compliance is the next module in our product suite to eliminate complexity and risk in using DeFi, and help any business benefit from using digital assets.”

Nasdaq collaborates with Blockchain Firm R3 for Digital Asset Management

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The US stock exchange Nasdaq has entered into a long-term collaboration agreement with the enterprise blockchain firm R3, to create a full-spectrum digital asset marketplace.

According to a press release on Wednesday (April 29, 2020), with a technology agreement with the R3 blockchain software firm, Nasdag will use the Corda Blockchain R3 to build its market technology business.R3’s Corda is an open-source blockchain platform that enables users to create decentralized applications (dApps). The new collaboration aim is to provide businesses with an easily accessible, comprehensive solution for issuing tokens and building trusted digital asset markets.

Commenting on the partnership Johan Toll, Head of Digital Assets at Nasdaq, said,

“This new relationship between Nasdaq and R3 will play an important role in Nasdaq’s continuous development of solutions and services that support the creation and growth of dynamic, trusted digital asset marketplaces”

Nasdaq is currently providing market infrastructure solutions to more than 120 + marketplaces, central securities and regulators, clearinghouses, and many digital asset exchanges. The R3 collaboration will accelerate Nasdaq’s efforts to help marketplaces for digital assets enhance transparency requirements to compete with their peers on the capital markets.

 According to Cathy Minter, Chief Revenue Officer, R3 said:

“Financial institutions are becoming increasingly aware of the huge potential for servicing the needs of digital assets. We can help them accommodate these assets with solutions that are designed for more secure, reliable, and regulated environments. Together with Nasdaq we will provide a world-class platform on which digital asset markets can be built, helping to rapidly accelerate the growth of these markets and others around the globe.”

As a technology provider for the capital markets, Nasdaq has early implemented blockchain across various ventures and proof of concepts that have embraced distributed ledger technologies. In January last year, Nasdaq started working with 7 different cryptocurrency exchanges by offering them proprietary market surveillance technology to improve the transparency standard.

Crypto exchanges were required to pass the Nasdaq-prepared test in order to qualify for the partnership and use of surveillance technology. According to the reports, only seven exchanges could pass the test. The proprietary market surveillance technology from Nasdaq scans for fraudulent trade patterns to ensure the volume of trading is free from fraud and manipulation

Top Five Cryptocurrencies to Watch in 2020

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Digital currencies could be due to huge gains in 2020. Well, it’s another year and there’s a lot to be offered by the cryptocurrency community. Bitcoin began the year in a really good shape convincing bulls that it’s time for business.

At the end of February, however, Bitcoin quickly collapsed, taking the rest of the cryptocurrency market with it. Despite the recent red market, a number of exciting projects and innovations are underway to watch out for. Having said that, let’s look at the top digital currencies to be on the watch list in 2020.

1. ChainLINK (LINK)

Back in 2019, LINK was the best performing digital currency and started the new year with the same momentum. Recently, ChainLink’s native token, LINK has seen staggering price movements. At the beginning of 2020, LINK is among the massive gainers of the bullish action At some point this year, its price has increased by more than 187 percent. In fact, LINK seems to be going against the price movement of Bitcoin. While BTC is down, LINK seems to have made key market gains.

Nevertheless, LINK’s price action is not the only interesting thing to keep an eye on; ChainLINK does some impressive business deals. In addition to partnering with giant search engine Google, ChainLINK has been busy forming more and more collaborations.

LINK has been building a buzz on the crypto platform, but the mainstream press still has so much to do. The price seems undervalued, making it crypto to watch this year.

2. Enjin Coin (ENJ)

The self-proclaimed gold standard for cryptocurrencies, Enjin coin (ENJ), has been gaining a lot of popularity among gamers. Enjin recently launched its mainnet on the Ethereum blockchain. It allows almost anyone to create games with items that live on a blockchain network.

After its launch, the token’s price had a massive rally reaching a record high. Nevertheless, it was subjected to the ongoing crypto reds market that revealed its correlation with other popular cryptocurrencies such as BTC and ETH.

The ecosystem of Enjin Coin consists of the Enjin platform, Explorer, Wallet, Beam, and other tools and services. This blockchain-based product ecosystem enables game developers and studios to use digitally tokenized blockchain assets as part of their strategies for acquisition, retention, interaction and monetization.

Its new product, which enables developers to create their own games and other in-game items driven by ENJ tokens. Currently, after a massive drop of 56% ENJ’s price $0.09 which seems very undervalued considering the ambitions of the project. It’s worth keeping tabs on.

3. Digitex (DGTX)

DGTX is a native token of the Digitex Futures Exchange. This startup aims to revolutionize the futures trading market for digital currencies by removing the commission liability from any trade. Scraping the fees will allow scalpers to make money and take advantage of the market’s tiniest price fluctuations. This is not possible at the moment, given the high fees charged by other exchanges.

In addition, the Digitex futures exchange has a user interface with a one-click trading ladder. This GUI helps the traders to remain in the price zone and position their orders with just a click of a mouse without using the keyboard.

The crypto startup will make it compulsory for traders to use DGTX tokens for all trades, hence enabling it to eliminate commission from all trades. In addition, this will also create a demand for the DGTX tokens among traders who want to enjoy commission-less trading and liquidity in the markets. Although that amount represents a 220% return rate for the initial ICO investors, DGTX enthusiasts are confident that it will reach its all-time high of 16 cents once it has been integrated for trading. 

The exchange is currently in beta version and the mainnet is expected to be rolled out by 27th April, stirring a bullish movement of DGTX price action regardless of how BTC is doing. Watch out for this one.

4. Tezos (XTZ)

Tezos (XTZ) is a blockchain network linked to a digital token, known as tez or tezzie. Token holders get a reward for engaging in the consensus mechanism of proof-of-stake.

Tezos is one of those cryptocurrencies which tends to increase in value when Bitcoin is down. Additionally, this year’s XTZ token price action was among the most active so far, experiencing huge gains and corrections.  Tezos blockchain has a huge global baker culture alongside a committed developer team.

Furthermore, both Coinbase and Kraken have recently listed XTZ for staking which resulted in a massive uplift to tezos.  With the current momentum of the token and the downward trend of BTC, this year’s XTZ is an interesting prospect.

5. Basic Attention Token (BAT)

Basic Attention Token is an Ethereum-based token created alongside Brave Browser home platform. This token was founded by Brendan Eich, co-founder of Mozilla and Firefox, who also created JavaScript.

Through Brave BAT will be used to pay content creators and advertisers via tips from loyal fans, and users will also receive BAT for viewing advertising. Basic Attention Token (BAT) aims to completely revamp the efficiency of digital advertising using its token, which can be transferred between advertisers, users, and publishers.

 

China’s Effort into Launching Digital Currency Takes The Ramp With New Patents

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China has made no efforts to hide the fact that it was diving headfirst into blockchain technology and cryptocurrencies. Banking officials in the Red Dragon have also commented multiple times on the future of a central bank digital currency.

New reports have shown that China is ramping up developments in the Fintech sector with its central bank filing 84 CBDC-related patents

The Financial Times first reported that the central bank of China was given the go-ahead by the government to outperform existing CBDCs. China had first come into the fintech picture when the head of the central bank, as well as Xi Jinping, admitted that utilizing blockchain technology was the way to go.

Information on the number of patents first surfaced after an investigation initiated by the United States Chamber of Digital Commerce. The last time the CDC was in the news was when it made its stance in the Telegram vs SEC case. This time around the CDC discovered that the Chinese patents focus on designing protocols that will control the issuance and supply of digital renminbi.

Perianne Boring, the President of the Chamber of Commerce added that China has made massive investments into the fintech industry. He also claimed that China was taking a very drastic approach from the United States about the blockchain industry. Some of the patents were related to the creation of a middle-layer entity to help customers deposit fiat and withdraw renminbi.

Some of the patents were in connection with the ‘tokenomics’ concept. The DCEP working group has also revealed that there were planning towards programmed inflation control mechanisms. Although no dates have been announced for the launch, many are expecting the digital renminbi to change the phase of the financial sphere.

Other countries have also taken steps to improve the digital assets sector. A think tank of central bankers from Canada, Sweden, Japan and Switzerland along with the European Central Bank has been set up to give clear definitions to the crypto industry. The group is set to have its first meeting in April.

Digital Assets Is The Way To Go For Uruguayan Clean-Up

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Cryptocurrencies have been known to create an ecosystem for growing functionalities within the financial sector. This has also allowed regions to utilize this feature and work it to their advantage.

In a positive twist to the cryptocurrency story, it has been revealed that virtual assets were working towards creating a better society in Uruguay.

New reports from the South American country showed that there was a growing system of earning virtual assets by doing good deeds. Citizens now have the option to earn digital assets if they deposit waste from the Piriapolis beach in designated areas. These assets can then be used for discounts or purchases in local restaurants or partnered shops.

The digital asset is nicknamed ‘Plasticoin’, after the mission to eradicate plastic waste from the beach. The initiative was taken by Juan River who launched the project alongside industrial designer Nicole Wyaux. Users interested in earning these Plasticoins can register online and then deposit plastic waste at one of three collection points.

The venture stated that the minimum deposit quantity is one kilogram. For every kilogram deposited, a user will get anywhere between 100 to 400 plasticoins. The structure showed that users will get 100 coins for household waste, 200 coins for beach waste and 400 coins for microplastics of less than half a centimeter as their Digital Assets.

The project has also received the backing of the Uruguayan government after an explosive start. The government had granted an initial fund of $5000 for propagating such a habit in the country.  The citizens have also responded positively to the developments and have promised to convert this opportunity into a society changing phenomenon. The country’s government entity National Agency for Development [ANDE] has pra the efforts taken by the entrepreneurs.

Over 600 users had registered in the initial phase of the project, with many more expected to be onboarded soon. There are also plans to expand the service to areas such as Maldonado, Solis, Ocean Park and Pan de Azucar.

The concept of cryptocurrency and blockchain technology has definitely taken the Latin American market by storm. Bitcoin and other cryptocurrencies have always been positive markers in the region with countries like Venezuela and Colombia takin charge.

Venezuela witnessed a rapid increase in crypto usage during its inflation hike and it continues to this day. This came at a time when the Nicholas Maduro led government launched its own state-backed cryptocurrency called the Soverign Bolivar or Petro.

Upon Death, What Happens to My Bitcoins?

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No one really has an idea of how long digital currencies will last, but it is a fair bet they will probably outlast you. It is not easy to pass one’s digital assets to their loved ones after one’s death. At least it is not as straightforward as passing cash or other properties.

In particular, given that wills are not tailored for confidential information, including one’s private key in the document would be a horrendous idea. According to Gordon Fischer, an estate planning attorney:

“I would strongly advise against anyone putting any information they consider private into their will. Wills, after your death, become court documents and are generally public documents, accessible by anyone.”

A Private Key refers to an almost unchangeable passcode. It is generated when someone creates a new cryptocurrency wallet and should be kept as safe and secure as possible. Unfortunately, there is no given way of regaining this private key for a probable heir, since there is no central authority that monitors those keys. It is quite safe to suggest Bitcoin affords one a unique challenge upon death.

If you depart this life without leaving anyone the private key, your bitcoins practically become beyond reach to anyone. In a similar fashion, if you endow your private key without mention of what it is and how to use it, your bitcoins are likely to be bygone. The brilliance of bitcoin is that the algorithm that creates them intrinsically limits the supply. This means when bitcoins are lost, the remaining ones in circulation become a little more valuable due to scarcity. However, this will not help your loved ones, will it?

How do you make sure your bitcoins are well passed on?

The easiest method is to ensure that your loved ones are aware of your bitcoin account. In addition, you should either entrust them with the private key now; or store the private key in a fitting secure site such as a safety deposit box. You can even reserve the private key on a thumb drive or an old-fashioned piece of paper.

If you become more concerned about security to trust the above methods; plus you have a fortune in cryptocurrency, you have a few alternative methods available to make sure that your potential heirs have access to their inheritance.

This one is interesting. It is possible to set up a “time locked” transition that will happen after a defined number of years in the future.  With the assumption that your heirs still have access corresponding receiver address to accept the crypto; they will receive the funds on a defined future date.  However, that is a risky move. The transaction will take place whether or not you are alive or dead, on the scheduled transaction date.

In addition, third parties such as Coinbase offers a more traditional alternative method: a vault. This is typically a safety deposit box for your private key. Coinbase offers joint accounts, which ensures your loved ones have an easy transition and access to their digital inheritance.

A clear set of estate plans

 Whichever method you choose to adopt, ensure that you have a clear set of estate plans in place. Making your wishes known helps you to circumvent probate; which is a strenuous enough procedure. 

The laws on the inheritance of crypto assets can be hazy and depends on the country you live in. It is important to consider consulting an attorney to help come up with your estate plans. Different sites may have different terms and conditions to apply; yet another reason to pursue professional guidance.

Moreover, the Revised Uniform Fiduciary Access to Digital Asset Act (RUFADAA) initiates the rules and regulations regarding digital account freehold. It’s significant to acquaint yourself with the RUFADAA; more importantly, update your wills, trusts, and POAs in conformity so that your fiduciaries gain access to your crypto assets.

Conclusion

Various digital assets, such as your Facebook page, may not have much monetary value. However, digital currencies have a basis and valuation that requires monitoring. Such assets can influence your estate taxes and the amount you pass to potential heirs.

The growing admiration for digital assets will not vanish anytime soon. For fiduciaries, it is significant to take the right insurance; and understand the nuances of such assets in the planning of digital estates.

 

China Pilot Testing its Digital Currency: Will the Digital Renminbi Challenge the US Dollar in the Currency Wars ?

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The majority of Chinese intellectuals called out over-reliance on the United States Dollar and seemed worried about the safety of Beijing’s massive amount of US dollar reserves. These scholars suggested the diversification of China’s reserve and pressed the government to globalize the Chinese Renminbi.

Against this backdrop to potentially unleash a currency war against the United States amidst heightening tensions with the Trump administration; The central bank of China is on its way to launch the digital renminbi.

Almost overnight, China has transformed into a global economic powerhouse. The nature of money has changed, and with it has come to a cashless payment society in China. Hundreds of Millions of Chinese citizens use popular payment applications to make purchases such applications like WeChat and Alipay. It is easy to see how immensely technology and quantum macroeconomics have redefined the future of money.

Since the inception of Bitcoin in 2009, many people have objected to the concept of fiat money.  Perhaps even challenging the perceived notion of the US dollar as a good store of value.

New Era in the Currency Wars

Now the People’s Bank of China (PBoC) is preparing to test the genesis of a global stable coin. In a bid to solve one of the biggest results of conspiracy in financial crises, several experts believe China’s digital currency marks the beginning of a New Era in the currency wars.It was unlikely that a digital currency could have the potential to challenge national currencies. Yet as it turns out, projects such as the Digital Renminbi and Facebook’s Libra could catalyze a new economic arms race against the US Dollar.

The fact is that programmable algorithms were initially not better storage of value, hence the rise of a volatile bitcoin. A cryptographic asset that could easily skyrocket by $10,000 or even declines to as low as $1000. Invariably, governments and central banks still had an upper hand in the financial ecosystem. However, Bitcoin and other altcoins still maintained a vast potential as mediums of exchange and international remittance.

Meanwhile, China’s Central Bank has been working on digital currency for the past six years in an effort to usurp the US dollar from its reserves. Figures have it that at least 58% of global foreign exchange reserves are held in dollars. While China could create an all parallel new financial ecosystem presently dominated by giants such as Paypal and SWIFT; it is unlikely that it would catch up with the US dollar. China positions its digital Renminbi as a stablecoin. And as it holds, stablecoins are regarded as the quintessential stepping stones towards the mass adoption of digital currencies.

Despite the Central Bank’s statue as one of the most advanced central banks in the world, PBoC shifted its acceleration forward following Facebook’s plan to unveil a global stablecoin. Beijing worried that if Facebook would unleash its currency to approximately 3.0 billion of its Facebook, whatsapp and Instagram users, China’s digital currency would be reduced to nothing. Therefore, the bank geared its effort to complete its work quickly and is currently preparing to launch its first pilot test.

Facebook CEO Mark Zuckerberg was skeptical about the United States laxity to renovate its financial system. The internet mogul referred to the currency war as global competition and guaranteed that his country’s financial leadership was at risk:

“China is moving quickly to launch a similar idea in the coming months,If America doesn’t innovate, our financial leadership is not guaranteed.“

While Libra is tied to a diverse amount of major currencies, the digital renminbi is backed by the regular yuan. Hence, it will be relatively stable. Yet unlike Bitcoin’s decentrality, the central bank will monitor all transactions that take place.

 

SEC Includes “Digital Assets” in its 2020 Examination Priorities – What to Look For?

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SEC Includes “Digital Assets” in its 2020 Examination Priorities: It’s been over 10 years for the existence of cryptocurrency and regulators from around the world are still discovering the best possible means to regulate it.

However, the most recent report published by the Securities and Exchange Commission (SEC), detailing the priorities for 2020 includes ‘their decision regarding digital assets’.

This report was detailed by ‘the US SEC’s Office of Compliance Inspections and Examinations (OCIE)’ which specifically mentioned;

“The digital assets market has grown rapidly and presents various risks, including for retail investors who may not adequately understand the differences between these assets and more traditional products,”

The agency will continue to research several aspects surrounding cryptocurrency such as the risks involved in it for retail investors and what makes digital assets differ from the traditional ones. The report further reads that;

“Due to these risks, OCIE will continue to identify and examine SEC-registered market participants engaged in this space. Examinations will assess the following: (1) investment suitability, (2) portfolio management and trading practices, (3) safety of client funds and assets, (4) pricing and valuation, (5) effectiveness of compliance programs and controls, and (6) supervision of employee outside business activities,”.

This isn’t the first time though, in the year 2018 as well, SEC reportedly included cryptocurrency as to how market players assure its assets the safety of their funds and whether or not they are educating customers about the risk associated with their digital asset-related products.

More so, OCIE went on to assure that they will oversee transfer agents which will certainly act as intermediaries in securities transactions or entities that are ‘developing blockchain technology’ or offering services to digital asset issuers. Interestingly, the document also highlights that they would supervise the staff, funds and outside business activities of crypto exchange.

You can read more about OCIE report here – https://www.sec.gov/about/offices/ocie/national-examination-program-priorities-2020.pdf