CME’s Duffy: Crypto Needs to Brown-Nose Governments to Succeed

Over the past year, crypto has struggled from a price standpoint. Thus, many investors that are looking to “HODL” have sought the light at the end of the tunnel that is institutional participation. But, one Wall Streeter, who has expressed some semblance of support for Bitcoin, recently claimed that this facet of the ecosystem just isn’t there yet.
CME CEO “Not Sure” Bitcoin Bottom
Since Bitcoin fell off the public’s radar in mid-2018, most incumbents of the legacy world have shut their trap, so to speak, regarding the subject matter. But, Terry Duffy’s interview on Bloomberg TV took a turn for crypto on Thursday.

In response to an inquiry from a Bloomberg host regarding if the value of the flagship cryptocurrency has established a bottom, the CME Group chief executive noted that he’s “not quite sure,” likely accentuating that he doesn’t keep up-to-date with this whole ecosystem.
Related Reading: Bitcoin Bottom Doesn’t Matter, Last Time General Population Can Afford Entire BTC
Duffy’s hesitant response on this matter comes as a number of analysts claim that Bitcoin has further to fall.
As reported by NewsBTC previously, Murad Mahmudov, a partner at Adaptive Capital, recently claimed that Bitcoin could find “steady support” at an MA300 of around ~$2,400. However, the prominent analyst made it clear that Bitcoin could “wick down” to as low as MA350~400 in the $1,700 range, “due to past patterns and how particularly overstretched the 2017 bubble was.”
Other made similar remarks. One crypto commentator recently noted that if history rhymes, BTC could fall to as low as $750 by mid-year, citing fractals and technical analysis.
Then again, some have been more optimistic. Leading researcher Filb Filb recently explained that there are  “staggering pre-halvening similarities [between] 2015 [and] 2019.” More specifically, he noted that if the price action seen in 2015’s bubble plays out today, BTC will bottom in the coming weeks, before embarking on a strong rally heading into 2020’s halving event.
Crypto Needs Governments To Succeed
On the matter of his futures product, Duffy stated that from the perspective of the CME, it just wanted to list Bitcoin in a controlled manner to appeal to regulators. That led him to his next point about institutional involvement. The investor noted that the “bottom line” is that until global governments start to accept cryptocurrencies, whether it be Bitcoin, XRP, Ethereum, or even JP Morgan’s own digital asset, it will be “very difficult for the major commercials to come into this space” in a gung-ho fashion.

Thus he determined that for cryptocurrencies, or any other nascent market for that matter, to succeed, the ecosystem surrounding them will need to gain approval from governments.
While strides are being made, such as through statements of support from the U.S. SEC’s Hester Pierce or other pro-crypto moves, this is more than likely an uphill battle.
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Crypto Tidbits: Meet JP Morgan Coin, SEC Drops Bitcoin ETF Application

After last week’s price action, the crypto market quieted down. Bitcoin entered a lull, while altcoins followed close behind. Yet, the wheels of the crypto train have continued to spin.
Twitter CEO Jack Dorsey revealed that his fintech upstart would eventually integrate Bitcoin’s Lightning Network, JP Morgan launched its own digital asset on a private Ethereum-based chain, a Filipino banking giant launched crypto ATMs, and Chainalysis secured millions amid this market rut.
Crypto Tidbits

Reality Shares Files Semi Bitcoin ETF, SEC Requests Application Withdrawal: Reality Shares, a California-based crypto-centric investment services provider, filed a peculiar application to the SEC, America’s leading financial regulator. This proposal outlined an ETF that was composed of both allocations in CME’s and CBOE’s Bitcoin futures and monetary instruments, like sovereign debt products denominated in the British Pound, Japanese Yen, Swiss Francs, among other government-issued currencies. But, in an odd turn of events, the governmental agency politely requested for Reality Shares to pull its innocuous application. Spokespeople told CoinDesk that the SEC enlisted such a move due to the fact that it wasn’t “appropriate to file a registered 40 Act fund with cryptocurrency exposure at this time.”
ICE CEO: Bakkt Is Our Moonshot Bet On Crypto: In the Intercontinental Exchange’s Q4 earnings call, chief executive Jeff Sprecher touched on crypto upstart Bakkt and its prospects in 2019. Sprecher, who is wed to the founder of Bakkt, explained that the company is “unique,” especially due to its independence and intentions. Yet, he explained that ICE has been able to apply its infrastructure — “settlement capabilities, warehouse and custody management capabilities, large treasury operations, and banking connectivity” — to the cryptocurrency venture. And thus, this “star power” has attracted “a lot of very very interesting companies,” such as Microsoft and Starbucks, giving Bakkt the potential to become a “very, very valuable company.” With all this in mind, the finance heavyweight concluded that if you boil Bakkt down, it could be classified as his firm’s very own “moonshot bet [on crypto].”
Chainalysis Secures $30M From Silicon Valley Venture Group: Earlier this week, Chainalysis, leading blockchain research and analytics boutique, revealed that it had scored over $30 million in funding for its Series B round, led by Accel, a Palo Alto-based venture group that also has investments in Circle. Accel’s deal with Chainalysis will also see the Bay Area investment group’s Philippe Botteri and Amit Kumar join the blockchain upstart’s board. Per Business Insider, the duo will aid Chainalysis in bolstering its presence, in the European region, along with its overall research efforts. The company explained that this influx of funding will help it double-down on its raison d’etre to make blockchain data easy to digest, useful, and accessible for governments, institutions, and native cryptocurrency firms.
Jack Dorsey Hints At Eventual Bitcoin Lightning Integration For Square: Just days after appearing on the Joe Rogan Experience to laud Bitcoin and releasing dozens of crypto-related tweets, Jack Dorsey, the chief executive of both Square and Twitter, took to Stephan Livera’s podcast to confirm that the integration of the Lightning Network onto Square is a matter of “when,” not “if.” Speaking on the rationale of eventually making such a move, Dorsey explained that his firm’s raison d’etre is to serve customers best, with Lightning only accentuating this goal. The Silicon Valley legend added that Square sees Bitcoin’s underlying nature as a currency, rather than solely a speculative asset. And as it stands, the widespread adoption of the Lightning Network is the most promising means to get to that ambitious end.
Philippines Banking Giant Has Launched Two-Way Crypto ATMs: According to reports from Filipino media, Union Bank of the Philippines, a banking giant that is the seventh largest in the country, is launching crypto asset automated teller machines (ATM). Per the statement, the company launched its first two-way cryptocurrency ATM earlier this week, allowing customers to purchase and sell assets like Bitcoin for pesos. Union Bank has purportedly collaborated with the Bangko Sentral ng Pilipinas (BSP), the nation’s central bank, to ensure that this newfangled offering is compliant.
JP Morgan Launches Ethereum-like Chain For In-House Crypto Asset: In a move that was straight out of left field, JP Morgan Chase, the world’s sixth largest bank, took to CNBC divulging that it would be launching an in-house crypto asset, fittingly named “JPM Coin.”According to a comment from Umar Farooq, the Wall Street institution’s blockchain division lead, the asset will be backed by physical U.S. dollars and will first be based on Quorum, JP Morgan’s private Ethereum-based chain. Eventually, the asset will go multi-chain, with interoperability solutions allowing for JPM Coin to be transacted in different ecosystems. Farooq remarked that his team intends the venture to eventually be a multi-purpose asset for the bank’s operations, whereas “anything, where you have a distributed ledger, [that] involves corporations and institutions” will use the stablecoin. For now, however, the JP Morgan executive made it clear that the newfangled offering is intended to bolster the company’s internal, yet international corporate transactions.

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Chainalysis Secures $30M: Despite Bitcoin Crash, Crypto Venture Money Still Flowing

The so-called “crypto winter” has undoubtedly been tough on a majority of this ecosystem’s upstarts, even those with supposedly colossal war chests and copious amounts of talent. Heck, earlier this week, Ripple cut Bloomberg alumni Cory Johnson, the fintech firm’s chief market strategist, due to shifts in the Bitcoin winds.
Bitmain, Huobi, and ShapeShift are also among industry powerhouses that have mandated staff cuts to bolster their bear market bottom lines. Other firms, such as Giga Watt and Liqui, have collapsed entirely.
But interestingly, it seems that the crash in the Bitcoin price hasn’t deterred opportunities. Even in trying times, money from ambitious venture capitalists and visionaries alike have continued to rush into this space, no holds barred.
Blockchain Analytics Group Finishes Series B
Ever since it secured $16 million in its Series A funding round during 2018, Chainalysis has become an integral but little-known mainstay in this space. For those who missed the memo, the company, which has headquarters in New York, is a blockchain research and software provider that has played a role in the back offices of the cryptosphere. While the company’s premise may seem boring for most, investors have become enamored with what the team has accomplished, and what it intends to do.
In fact, in a press release issued Tuesday, Chainalysis divulged that it had scored over $30 million in funding for its Series B round, led by Accel, a Palo Alto-based venture group that also has investments in Circle.

Excited to announce our latest funding round of $30m led by @Accel to support strategic product development of new cryptocurrency use cases and a new office in London! Read more: https://t.co/0Rn2li4wkO
— Chainalysis (@chainalysis) February 12, 2019

Accel’s deal with Chainalysis will also see the Bay Area investment group’s Philippe Botteri and Amit Kumar join the blockchain upstart’s board. Per Business Insider, the duo will aid Chainalysis in bolstering its presence, in the European region, along with its overall research efforts.
With this influx of funding, the analytics unit has decided to bolster its team. The company currently has 30 open roles, including stints ranging from the vice president of finance to the team lead for cybercrimes. Although the company has its primary offices in New York, many of the new positions are located in London and Copenhagen, the former of which is where Chainalysis is looking to double its headcount.
This $30 million dollar deal, which also saw participation from other unnamed financiers, isn’t just about acquiring talent though. Chainalysis divulged that it intends to double-down on its raison d’etre to make blockchain data easy to digest, useful, and accessible for governments, institutions, and native cryptocurrency firms. The company wrote:
“We are building a team that is focused on attributing more services associated with criminal activity, including darknet markets, scams, ransomware, terrorist financing, and sanctions evasion.”
The New York-based firm also explained that it intends to begin analyzing an array of other cryptocurrencies, not just assets like Bitcoin and Ethereum, while also bolstering its “compliance and investigation software” to create a fair environment for cryptocurrencies.
Exact specifics regarding Chainalysis’ plans were scant, but considering that the firm has garnered the support of Binance, Barclays, among a series of other fintech firms, its future remains bright, whether Bitcoin continues lower or otherwise.
Related Reading: Chainalysis: Up to 3.79 Million Bitcoins May Be Lost Forever
Crypto Venture Tap Still Has Water
While props to Chainalysis would be in order, this move only accentuates how the crypto venture capital tap still has water, even in spite of the harrowing market conditions. On Tuesday, Morgan Creek Digital, a crypto-centric venture group headed by fervent decentralist Anthony “Pomp” Pompliano, revealed that it had launched a $40 million fund.

The fund, launched weeks, if not months ago, saw investment from two public pension funds that pertain to Virginia, a private institution, a university endowment, and other investors. The fund purportedly already allocated capital towards Bakkt, Coinbase, Harbor, and Blockfi, just to name a few notable crypto upstarts.
Speaking of Bakkt, the Intercontinental Exchange-backed initiative secured over $182.5 million in one of the largest crypto-related deals to date. This round saw Boston Consulting Group, CMT Digital, Horizons Ventures, ICE itself, Microsoft’s venture wing, Pantera Capital, and Galaxy Digital make allocations.
All this and more only goes to show that although BTC has continued to trade in a tight range, with analysts claiming that lower lows are inbound, the smart money is under the impression that eventually, this market will undergo a resurgence.
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XRP Holds Strong After JP Morgan ‘Slaps’ Ripple With Bank-Centric Crypto

Ripple and its go-to crypto asset, XRP, have long been a nuanced topic of discussion in the cryptosphere. Many have argued that the San Francisco-based fintech startup, deemed a company to watch by Forbes, is sleeping in bed with banks, along with other incumbents of the legacy world.
But, this might not exactly be the case, as a Wall Street giant recently revealed plans to issue a digital asset that poses somewhat of a threat to Ripple’s operations but not to Bitcoin’s value.
Ripple Under Threat Due To JPM Coin?
In a move that was straight out of left field, JP Morgan Chase, the world’s sixth largest bank, took to CNBC divulging that it would be launching an in-house crypto asset, fittingly named “JPM Coin.” According to a comment from Umar Farooq, the Wall Street institution’s blockchain division lead, the asset will be backed by physical U.S. dollars and will first be based on Quorum, JP Morgan’s private Ethereum-based chain. Eventually, the asset will go multi-chain, with interoperability solutions allowing for JPM Coin to be transacted in different ecosystems.
Related Reading: JP Morgan: Crypto Value Unproven, Bitcoin (BTC) Could Fall as Low as $1,260 in Near Future
Farooq remarked that his team intends the venture to eventually be a multi-purpose asset for the bank’s operations, whereas “anything, where you have a distributed ledger, [that] involves corporations and institutions” will use the stablecoin.
For now, however, the JP Morgan executive made it clear that the newfangled offering is intended to bolster the company’s internal, yet international corporate transactions. While this project may have an innocuous premise, many crypto commentators quickly took to Twitter to remark that Ripple’s services and the XRP Ledger’s function could come under fire.

“This is a huge slap in the face for Ripple,’’ said @Shaughnessy119. “Ripple’s target market is cross-border payments and remittances and now JPMorgan’s effort is a direct threat.’’https://t.co/vAb67rg2kq pic.twitter.com/80qDJ8U061
— Frank Chaparro (@fintechfrank) February 15, 2019

Tom Shaughnessy, the principal analyst at Delphi Digital (recently merged with 51Cryptos), told Bloomberg that JPM Coin is a “huge slap in the face for Ripple,” explaining that the fintech group’s cross-border payments and remittance efforts may go kaput. Travis Kling, the chief investment officer at Ikigai, echoed this sentiment to a tee. He told Bloomberg that while Quorum is much like Google Sheets, rather than Bitcoin, JPM Coin is “clearly competing directly” with Ripple Labs.
Both Kling and Shaughnessy then drew attention to what they see as flaws in the nature of XRP. Kling quipped that it’s a “centralized cryptocurrency,” rebutting comments from Ripple’s CEO, as the Delphi Digital researcher remarked that XRP’s volatile nature will be “contentious” for institutions that are looking for cross-border payments.
And interestingly, much of the crypto community was in agreement. Esteemed Bitcoin trader Moon Overlord joked that he’s shocked that JP Morgan created their own coin instead of XRP. Others remarked that JP Morgan “killed the XRP dream,” alongside other quips of similar nature.

Tushar Jain, a managing partner at Multicoin Capital, remarked that banks were never planning to use XRP for settlements, thus concluding that JP Morgan will “wipe the floor with Ripple.”
But, in spite of all these comments, the value of the popular cryptocurrency has held relatively strong.
XRP Stands Its Ground
According to data from Live Coin Watch, the asset has posted a mere 1.1% loss over the past 24 hours, while BTC is up 0.07%. While XRP’s slight underperformance may be a cause for concern for some of its holders, some have effectively concluded that the JP Morgan news had no notable material impact on the value of the asset.
Interestingly, analysts have had mixed reactions about the fact that XRP barely budged when JPM Coin began to trend on Crypto Twitter. Lucid TA, a technical analyst/fund manager, remarked that XRP’s lack of volatility only accentuates that 95%+ of crypto price action is “determined by capital flows and speculation,” rather than fundamentals. He added that from his point of view, the Wall Street bank’s own crypto asset is “extremely bearish” for Ripple.

Here we have yet more evidence that crypto prices are 95%+ determined by capital flows and speculation (and not fundamentals!).
JPM releasing its own crypto is *extremely* bearish for $XRP, yet the chart hasn't moved a cent.
— Lucid TA (@Lucid_TA) February 15, 2019

Crypto Quantamental, another Bitcoin-friendly fund/investment manager, begged to differ, explaining that XRP’s non-action is a “proof of concept” that the asset adds value to the finance ecosystem. While the trader did admit that Ripple isn’t going to challenge SWIFT head-on, it should be able to garner some traction in the business-to-business and small financial institutions space.

I view it opposite. It’s bullish. It’s proof of concept of their value add. Very few other coins even have that!
Ripple is NOT going to get the intranet of huge banks. That should have been known. B2B and intra much small fin institutions is their market
— Crypto Quantamental (@CryptoQF) February 15, 2019
Yet, while XRP has held relatively strong over the past 24 hours, the asset is currently trending lower. And with more news regarding the traction that JPM Coin garners, XRP could lose some of its potency over the long haul.
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Even During Nuclear Winter, the Largest Crypto Asset Manager Controls Nearly $1 Billion

Cryptocurrencies have continued to stumble, but one organization has been making promising strides in the back offices of the Bitcoin space. Grayscale Investments, a wholly-owned subsidiary of the crypto conglomerate that is the New York-based Digital Currency Group, revealed that its products secured millions in investment amid the so-called “crypto winter.”
Crypto Winter Has Been No Match For Grayscale’s Bitcoin Fund
Grayscale, headed by Michael Sonnenshein, recently released its “2018 Digital Asset Investment Report” to outline company performance over the course of yesteryear. And surprisingly, the statistics were arguably not foreboding, but optimistic.

BREAKING: We are excited to share our 2018 Digital Asset Investment Report!
2018 Highlights include:• Total Capital Raised into Grayscale Products: $359.5M • Majority of investment (66%) came from institutional investors
Read the FULL report https://t.co/Kjv3tBdqrl pic.twitter.com/GGvTJ2eqLJ
— Grayscale (@GrayscaleInvest) February 14, 2019

The company first accentuated that as it stands, it has $825 million worth of assets under management, 43.5% ($359.5 million) of which entered Grayscale’s care in 2018. While this figure was impressive in and of itself, it was later explained that 66% of inflows came from institutional investors, who Grayscale claims are “building core strategic positions in digital assets.” Doing some napkin math, that means that $237 million of investments in Grayscale’s products, which include in-house Bitcoin, Ethereum, and Stellar Lumens funds, came from institutional players.
While $237 million may not seem like a monumental sum, critics of Grayscale’s 2018 figures would be remiss to neglect fiat amplifiers. Alex Kruger, a leading cryptocurrency economist and researcher, recently did some analysis on how nominal fiat inflows affect the aggregate value of all cryptocurrencies.

According to JPM, only 2 billion dollars entered Bitcoin in 2017 => $2 billion propelled bitcoin's market cap from $15 billion in Jan/1/2017 to $250 billion by year end. pic.twitter.com/6vW0lJ5WvB
— Alex Krüger (@Crypto_Macro) January 3, 2019

Citing a 2018 report from JP Morgan regarding cryptocurrencies, the New York-based trader explained that that Wall Street institution is calculating a fiat amplifier of 117.5 ($1 million in fiat investment turns into $117.5 million in cryptocurrency value). But, this isn’t the whole story. Citi purportedly estimated an amplifier of 50, while Chris Burniske of Placeholder Ventures calculated the figure out to somewhere between two and 25.
Thus, considering a low-end estimate of a ten times fiat multiplier, Grayscale’s institutional clients could have infused $23.7 billion worth of registered market capitalization into this space over 2018.
Regardless, what was made clear is that institutions still are interested in allocating capital to the cryptosphere, as the heads of such groups look to accumulate when the price of Bitcoin remains in a lull.
2019: The Year Of Institutional Investors
These statistics haven’t gone unnoticed. Barry Silbert, the founder of Digital Currency Group, Grayscale’s parent organization, recently took to CNBC to express that the advent of institutional investors will continue to be an industry trend in the coming months. As reported by NewsBTC previously, Silbert commented that products like Bakkt’s futures only accentuate that bigwig firms are poised to make investments in Bitcoin.
Galaxy Digital Holdings founder Mike Novogratz also recently made a similar comment. In an interview with Bloomberg TV, the former Goldman Sachs partner noted that it is only a matter of time before institutional-sourced greenbacks appear on crypto’s marketplaces.
Echoing comments he has made over recent months, the Galaxy Digital chief executive noted that the “architecture” that would entice institutions to make noticeable capital and effort allocations are starting to be put in place.
Case in point, Fidelity Investments, a world-renowned financial institution with over ten thousand clients in its institutional Rolodex, recently revealed that it could launch its crypto custody offering by March. Novogratz explained that this service, along with products of a similar caliber, will pave the way for “smart money” to make a foray.
Related Reading: Novogratz: Institutions Will Drive The Next Crypto and Bitcoin Boom
While industry insiders are talking up a big game, some fear that there actually aren’t that many bigwigs waiting on the crypto sidelines. Case in point, over recent months, both Coinbase and Blockchain, which both have institutional investor-centric divisions that are some of this sector’s most prominent, dropped notable hires from Wall Street.
Representatives from the firms claimed that there has been a noticeable shift in the underlying status of cryptocurrency investment. More specifically, it was explained that “crypto-native firms,” like hedge funds, projects, and venture groups, were the institutions requesting services, rather than Wall Street hotshots.
Yet, some believe that this is just “noise,” which is trying to mask the fact that true financial incumbents are revving their crypto engines. Binance, BitGo, and Coinbase are all notable industry upstarts that launched over-the-counter (OTC) desks over the past months, indicating that some high-ticket clients are requesting for a more efficient trading medium.

On Thursday, The Block exclusively reported that LJ Brock, who hails from Chicago hedge fund giant Citadel’s C-suite, would be joining Coinbase. In a company email obtained by the outlet, Coinbase chief Brian Armstrong remarked that he’s “really excited” to have Brock join the team, especially due to the new hire’s people experience and stints on Wall Street.
While this move is unlikely to affect institutional investors with a growing penchant for crypto directly, this move could underscore that Coinbase and its competitors are still looking to entice non-consumer populations to take the plunge. But will they?
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Analysis: Here’s Why JP Morgan Is Launching Its Own Centralized Crypto Asset

Jamie Dimon, the chief executive of JP Morgan Chase, has long been a skeptic of cryptocurrencies, especially Bitcoin. After calling the flagship crypto asset a “fraud,” remarking that it’s much worse than the tulip bulb bubble of yesteryear, Dimon remarked that he doesn’t give a single sh*t about the project.
But, in a jaw-dropping turn of events, Dimon’s firm revealed that it would be diving head first into the blockchain space on Thursday. While some yelled hypocrite, as Dimon’s comments remain fresh in crypto enthusiasts’ minds, there may be a logical reason for the firm’s seemingly sudden 180°.
(Private) Blockchain Tech Is A Money Saver For Banks
For those who missed the memo, on Thursday morning, JP Morgan revealed to CNBC that it would be launching the so-called “JPM Coin.” This digital asset, which will initially run on top of Quorum, the bank’s private Ethereum-based ecosystem, is slated to become a stablecoin that will solely be transacted with the corporation’s walls.
In a comment to CNBC, Umar Farooq, the head of JP Morgan’s blockchain division, explained that a “tiny fraction” of the institution’s $6 trillion in corporate transactions would be made through JPM Coin. Farooq didn’t explain what the fraction would equate to, but as it stands, it is unlikely that the bank is poised to transact billions on their nascent centralized blockchain.

While many pundits have argued that the use of a centralized blockchain is inefficient, especially considering that tokens based upon such an ecosystem are 100% subject to the whims of fallible entities, the company may have a good reason for not heeding by Dimon’s word.
Long story short, the company, just like a good majority of other Wall Street bigwigs, wants to minimize costs through any means. While JPM Coin hasn’t been proven in the field, projects of similar caliber employed by other banks have seen some success.
HSBC’s Mark Williamson recently told Reuters that it has been saving a copious amount of trading costs due to its up-and-coming company blockchain. The chief operating officer of HSBC’s forex trading arm purportedly explained that blockchain-enabled transactions made on HSBC’s so-called “FX Everywhere” system were 25% than traditional methods. While HSBC’s offering doesn’t involve an in-house crypto asset, the premise is somewhat similar, meaning that extrapolating cost savings isn’t entirely illogical.
Thus, while Dimon still seems to be convinced that Bitcoin and other crypto assets aren’t fine and dandy, JP Morgan’s blockchain division are likely looking at green boxes in their books, rather than the morals of JPM Coin.
Funny enough, this newfangled digital asset comes after the Wall Street institution released a foreboding report regarding the long-term prospects of cryptocurrencies. Though, the firm’s research division was bullish on blockchain technology and similar innovations. Per previous reports from this outlet, JP Morgan’s researchers wrote that Bitcoin is only best used in a dystopian world, one where fiat currencies and traditional banks are all but dust.
Regardless, Crypto Community Still Detests JPM Coin
Although JP Morgan’s attempt to bolster its bottom line is commendable from an economic perspective, much of the crypto community lambasted the organization for its cryptocurrency project.
As reported by NewsBTC just hours after the jaw-dropping news broke, industry diehards came out in force to lambast JPM Coin. Alec Ziupsnys, better known as Rhythm Trader, noted that the company’s venture isn’t much of a “cryptocurrency.” WhalePanda echoed this sentiment, quipping that the new product is a “useless sh*tcoin.”
But these quips were just the tip of the iceberg, as a mass of crypto commentators took to their Twitter feeds en-masse to bash the institutions’ audacity to introduce the umpteenth stablecoin, one that is entirely centralized no less.
Anthony Pompliano, an anti-establishment figure that heads Morgan Creek Digital, joked that the “most popular token for money laundering this year” will be JP Morgan’s very own asset, likely referencing the fact that Bitcoin is barely used for “cleaning cash,” if at all.

The most popular token for money laundering this year will be JPM Coin
— Pomp (@APompliano) February 14, 2019

Brad Garlinghouse, the chief executive of Ripple Labs, also had something to say about the offering. In a Twitter comment that garnered some semblance of support of both the XRP and Bitcoin community, the fintech guru explained that JP Morgan’s sudden launch of a digital asset is like launching “AOL after Netscape’s IPO.” This is, of course, in reference to the earliest Internet browsers at the commencement of the first notable Dotcom boom and bust cycle.
Related Reading: Dotcom Bubble Burst May Have Been Necessary; What About Crypto?
Even Bitcoin Nouriel “Dr. Doom” Roubini, a professor at Stern School at New York University, had some laudable choice words for JP Morgan’s newest venture. Roubini, who has claimed that Bitcoin will go to $0 on multiple occasions, explained that JPM Coin is far from the public, permissionless, and decentralized nature that cryptocurrencies are best known for.

In which way has the new alleged JPMorgan crypto coin anything to do with blockchain/crypto? It is private not public, permissioned not permissionless, based on trusted authorities verifying transaction not trustless, centralized not decentralized. Calling it crypto is a joke
— Nouriel Roubini (@Nouriel) February 14, 2019

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Bitcoin Giant BitMEX: Major Financial Crisis Could Be Several Years Away

The economy is doing just fine, they say. No, maybe not. A growing number of economists (and notable ones at that) have begun to tout theses accentuating that the world’s economy isn’t in clear waters, in spite of the seemingly ever-rallying stock market. Bitcoin giant BitMEX’s research division broke down this subject matter on Tuesday, as it released an extensive study regarding the “anatomy” of the potentially inevitable global fiscal imbroglio.
Hold on to your hats, what they wrote wasn’t all too pretty.
The Impending Crisis & Bitcoin
The research unit at the Hong Kong-headquartered exchange first laid out a number of ground rules, explaining that since the rise of modern society, financial crises have brutalized investors every decade or so. BitMEX Research went on to leverage dozens of statistics to outline the state of the global economy as it stands.

MUST READ. IT’S HAPPENING.
Anatomy Of The Next Global Financial Crisis – BitMEX Blog https://t.co/YuEx7Bxt9R
— Max Keiser, tweet poet. (@maxkeiser) February 12, 2019

Long story short, the team of researchers and analysts noted that the current financial system is currently unstable and fragile, backing their claim by drawing attention to the dichotomy between the overall lack of volatility and sudden spikes in the VIX. They noted that this instability has only been underscored by low-interest rates and a tumultuous political climate (think Brexit, Trump/China, and the Yellow Vests), making it all the more likely that a crisis is brewing under the surface.
And with all that in mind, BitMEX’s research team noted that maybe it would be wise for investors to start building portfolios that mitigate risk. The exchange’s team wrote;
“Maybe one could construct a portfolio of VIX calls, long dated corporate bond ETF puts, index-linked government bonds, hedge funds specializing in volatility, gold and maybe to a lesser extent, even Bitcoin. Again, although one cannot know when these events will occur, perhaps now is a time to adjust one’s investment portfolio.”
Related Reading: European Central Bank Exec: Bitcoin is the “Evil Spawn of the Financial Crisis”
Financial Incumbents Are Waving Red Flags Too 
Even the mainstay in the legacy financial realm, the International Monetary Fund (IMF), has begun to express a sentiment that should have both institutions and common Joes worried. In a recent speech at the World Government Summit in Dubai, IMF’s Christine Lagarde remarked that there are “four clouds” closing in on the global financial environment, even quipping that a “storm” might strike.
Lagarde explained that these clouds include the trade spats between the U.S. and China, quantitative tightening, Brexit, and, arguably most importantly, the “heavy debt” that governments, individuals, and corporations alike have garnered.

And according to a recent piece from MarketWatch, the amount of U.S. national debt just breached a record $22 trillion earlier this week, solely cementing the idea that the world’s economy could be in dire straits. In response to this swelling statistic, the Peterson Foundation, an American financial services group that is focused on amending the nation’s economic issues, claimed that the fiscal situation is “not only unsustainable but accelerating.”
While some claim that by some holy miracle, the U.S. government will find a way to pay its debts (or default on them without a macro meltdown), a mass of economists is seemingly claiming that the end is nigh.
Ray Dalio, the co-founder of the world’s largest hedge fund, Bridgewater Associates, recently drew eerie parallels between today’s environment and the one seen in the midst of the Great Depression. In a comment made at Davos, the world-renowned investor, who has become a market pessimist as of late, explained that from 1929 to 1932, there was a lot of “printing of money, and purchases of financial assets,” much like today.

If you don’t want to hear it from one of America’s wealthy men, for some reason, others have made similar comments. Dr. John Hussman, an American economist & investor with a track record of prediction crises, noted that the earnings growth that investors have postulated is likely to “fall short of what we’ve observed over the past couple of decades.” Hussman coupled this with the idea that investment advisors are tacitly promoting “reckless speculation” to conclude that stocks are trading at “most obscene valuations” ever.
Even Kenneth Rogoff, an economics professor at Harvard University and a former IMF chief economist, expressed dismal sentiment in a recent Guardian op-ed. Rogoff remarked:
“Unfortunately, an inexorably growing financial system, combined with an increasingly toxic political environment, means that the next major financial crisis may come sooner than you think.”
Could Crypto Be The Answer?
Travis Kling sure does think that cryptocurrencies, especially Bitcoin, could be the answer to a crisis, or at least the asset that will be left standing after such an event. Kling recently stated that Bitcoin is a perfect hedge against “fiscal and monetary policy irresponsibility.” He stated that the monumental rise of employed quantitative easing (QE) strategies is “how you would write the script” for the adoption of cryptocurrencies, especially ones that tout a decentralized nature.
Trace Mayer, a long-time Bitcoiner and a zealous anti-establishment thinker, echoed Kling’s concerns regarding the buildup of public debt. In a recent tweet, Mayer remarked that it’s been a mere 11 years since the 2008 recession, but that governments and society at large haven’t learned, accumulating $87 trillion more debt as humanity’s relentless lust for growth continues.

https://t.co/7mqtD0i5M2
11 years later with $87T more debt. Second verse is little bit louder & little bit worse.
Except now liquidity pyramid's safe & liquid tip $gold has new neighbor: #Bitcoin
And 99% cash & 1% $BTC can be a very good risk/reward portfolio construction. pic.twitter.com/wZy29LvXAN
— Trace Mayer (@TraceMayer) February 13, 2019

Echoing analysis done by PlanB, Mayer then concluded that a portfolio consisting of 99% cash and 1% Bitcoin could be great from a risk/reward perspective, and could outperform in a worldwide bear market.
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SEC Taking Time to Approve Bitcoin ETF Makes “Perfect Sense” Says Bitwise, Even Gold Took a While

2,500 of the world’s foremost investment professional descended on Hollywood this week to talk exchange-traded funds (ETFs). While much of the discussion between the who’s who on Wall Street was centered around traditional vehicles, talk surrounding Bitcoin (BTC)  and cryptocurrency products came to light.
In an interview with CNBC’s Bob Pisani, a leading representative of the cryptocurrency space expressed optimism towards the launch of a product, which could thaw BTC out of a price crash-induced cold snap.
Related Reading: Bitcoin ETF Approval Could Ease EU Regulators Concerns About Crypto
SEC Is Coming To Understand Crypto’s Issues
Bitwise Asset Management CEO Hunter Horsley, a guest on CNBC’s segment, first noted that by many, if not most measures (save for price), 2018 was a solid year for crypto’s facets. Horsley remarked that while token values plummeted, in “everything you can wish for,” strides were made, especially in terms of market structure and participation. He drew attention to Fidelity’s up-and-coming custody product, CME’s and CBOE’s futures, along with participation from university endowments, Facebook, and Samsung to give his point some credence.
So, he concluded that cryptocurrencies as an asset class are in their “most viable” state ever. That led Horsley to his next point, as he remarked that considering the market conditions, a crypto-linked ETF could be the logical next step.

Fun chatting with CNBC’s @BobPisani at #InsideETFs today. We spoke about the @BitwiseInvest @NYSE Bitcoin ETF filing and the state of the crypto market coming out of 2018. https://t.co/H8u8FAoAjO
— Hunter Horsley (@HHorsley) February 12, 2019

First, the Bitwise C-suite member remarked that his firm’s S-1 application, filed just weeks ago, will be reviewed by the U.S. Securities and Exchange Commission in March.
Then, when questioned by the CNBC anchor regarding the SEC’s apparent fears of market manipulation, a byproduct of nascent, overseas-based markets, and custody, Horsley responded with confidence.
The former Facebook and Instagram product manager explained that from his firm’s point of view, the SEC has “a lot more understanding in place” regarding the state of cryptocurrency markets. And while “the numbers you see on various crypto-related websites [often] aren’t accurate,” Horsley pointed out that a fleshed-out comprehension of the industry’s inner workings is what truly matters. Concluding his comments on the SEC’s role in the Bitcoin ETF realm on an optimistic note, the industry heavyweight stated:
“Leverage ETFs took five years. Actively-managed ETFs took six or seven years. Even gold, which has been around for thousands of years and had a product in Australia, took three years from S-1 to initial launch. And I think that the fact that the SEC has taken a couple of years to get comfortable with [cryptocurrencies] makes complete sense. It’s not that they are anti-crypto, but they’re pro-investor.”
The Bitwise chief executive’s hopeful comments come just a day after Ric Edelman, a well-respected American investor with decades in the business, quipped that the launch of Bitcoin ETF has an inevitability. Per previous reports from this very outlet, Edelman, a world-renowned financial services guru, noted that trading of a cryptocurrency product on U.S. markets is a matter of “when,” not “if.”

Like Horsley, the Philadelphia-based investors explained that the regulatory incumbents with jurisdiction over digital assets are slowly coming to terms with the state of this embryonic space.
The Importance Of A Bitcoin ETF
In response to a query from CNBC host Pisani regarding the potential impact that a crypto fund would have on the ecosystem, Horsley noted that for a vast number of investors, an ETF would be an “enabling moment,” whereas thousands, if not millions of consumers would suddenly be enticed to make a proper foray into the Bitcoin realm.
While Horsley seems to be in agreement with the theory that a publicly-traded cryptocurrency fund could be the greatest thing to ever happen to this ecosystem, some have politely refuted this thought process.
Just yesterday, Alec “RhythmTrader” Ziupsyns noted that if Square, a fintech upstart headed by Twitter CEO Jack Dorsey, integrates the Lightning Network, the effect on the market would be larger than a Bitcoin ETF and Bakkt combined.

Even Anthony Pompliano noted that there’s a fleeting chance that the eventual launch of a Bitcoin ETF could not turn out as some expect, as the hype surrounding such a product could be overstated. In an interview with BlockTV conducted in January, the Morgan Creek Digital co-founder postulated that if BTC didn’t run off the SEC’s approval of an ETF, investors’ psyche would likely be damaged en-masse, potentially hurting this industry’s long-term potential.
Anyhow, the overwhelming majority have stuck with the idea that when a Bitcoin ETF finally comes to market, this industry will see interest from millions of consumers once again, as barriers to entry get wiped away once the SEC gives a green light.
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Bitcoin is Not Only a Hedge Against Inflation, But a Cashless Society Too

Bitcoin (BTC) may have lost over 80% of its value over the past 13 months, but many have argued that its underlying value proposition has only become more and more apparent. Hasu and Three Arrows’ Su Zhu, two crypto researchers, touched on the subject matter on Tuesday, when they released a collaborative blog post outlining the value that Bitcoin poses to a society rife with government-issued digital money.
Related Reading: Banks are Better than Bitcoin (When It Comes to Money Laundering)
E-Money To Make Society Vulnerable To Surveillance, Control
Cash, not money (yes, there’s a difference), has existed for hundreds, if not thousands of years. For those who missed the memo, cash is inherently a peer-to-peer, permissionless, and private medium.
Yet, with the rise of the digital payment services in mind, Hasu and Zhu argue that the hegemony that forms of cash has established itself could be coming to an end. The duo writes that PayPal, Venmo, Square, and products of similar caliber and nature “remove every need for cash,” as they’re marketed as faster, cheaper, and more efficient forms of payment.

New article with @zhusu where we argue that the elimination of cash, even if most payments are already digital, will make society more vulnerable to surveillance, financial control, and authoritarianism.https://t.co/kRVwaJM7Cr
— Hasu (@hasufl) February 12, 2019

The database tracking these transactions made with online money is already available for the powers that be, allowing the establishment to watch over society with a Sauron-esque eye. And with the seemingly relentless rise of these services and ecosystems, cash could become a thing of the past in the near future. They explain:
“The use of cash in larger denominations has become so stigmatized in the US and Europe that withdrawing or carrying above a certain amount requires explicit government permission… We will argue that the elimination of cash, even if most payments are already digital, will make society more vulnerable to surveillance, financial control, and authoritarianism.”
While the absence of private, permissionless mediums of exchange wouldn’t necessarily be a problem if humans were non-fallible, such a sterile utopia only exists in the minds of sci-fi writers. Thus, Hasu and Zhu noted that while governments would claim that going cashless protects citizens, censorship, fund confiscation, and the like would become the norm.
But that’s where Bitcoin comes in. They explain that the crypto asset could become a viable hedge against a cashless society. It was noted that while Bitcoin evidently has a use case as a deflationary asset, much like gold, it’s best used as a new breed of money — digital cash, “that combines the benefits of physical cash with the benefits of digital payments.”
Bitcoin Has A Bright Future
Hasu and Zhu aren’t the only industry insiders with this specific thesis regarding Bitcoin’s value in the real world. Arthur Hayes, the chief executive of the Hong Kong-headquartered BitMEX, took to his company blog at the start of 2019 to make a similar argument, accentuating that an entirely cashless society isn’t optimal.

As reported by NewsBTC previously, Hayes explained that as technology and the Internet continue to overtake all facets of society, a centralized, government- and corporation-backed e-money will likely become only “natural.” While such a system would be efficient for the common Joe and Jill, who crave for convenience and efficiency, such a form of sovereign digital money would increase the propensity for consumers to hand over their formerly private data.
Much like Hasu and Zhu, Hayes explained that the world’s first blockchain network is uncensorable, borderless, non-inflationary, and most importantly (in the eyes of Hayes), private — a far cry from the centralized monetary systems of the future. The BitMEX CEO explained that privacy is an integral part of any well-function society, making a system like Bitcoin more than essential.
Even if society doesn’t opt to adopt a fiat digital medium of exchange, many argue that Bitcoin still has a very bright future ahead of itself. In comments made at an alternative investment event in the Grand Cayman, Travis Kling, the chief investment officer of the Los Angeles-based Ikigai, remarked that Bitcoin is a perfect hedge against “fiscal and monetary policy irresponsibility.” He stated that the monumental rise of employed quantitative easing (QE) strategies is “how you would write the script” for the adoption of cryptocurrencies, especially ones that are fully decentralized.
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Researcher: Bitcoin Lightning On Square Could Be Bigger Than Crypto ETF, Bakkt Combined

Although many industry insiders talk a big game about the real world viability of Bitcoin, as it stands the cryptocurrency has seen little adoption. In fact, it has been anecdotally said that the number of brick and mortar merchants accepting BTC has plummeted, not risen over the past years.
Yet, this could change soon, as one of the most popular mobile applications in the U.S. was revealed to be slated to double-down on its in-house Bitcoin offering. Some have even argued that the integration could single-handedly propel this industry to new heights.
Related Reading: Analysts Applaud Square’s Bitcoin Strategy as Brilliant Despite Low Profitability
Twitter CEO Continues Bitcoin Crusade
In the past two weeks, Jack Dorsey, the chief executive of both Twitter and Square, has risen to monumental status in the cryptosphere. While he made brief comments about his enamorment with Bitcoin in early-2018, he went full evangelist in early-February, as he extensively touted the merits of an Internet-centric decentralized currency. On Joe Rogan’s Youtube podcast, the Silicon Valley guru claimed that the battle-tested Bitcoin could easily become the native currency of the entire Internet ecosystem.

Bitcoin is resilient. Bitcoin is principled. Bitcoin is native to internet ideals. And it’s a great brand.
— jack (@jack) February 5, 2019

He expressed a similar sentiment on Twitter. In fact, Dorsey made over 100 tweets regarding cryptocurrencies in a rant-esque fashion. Per previous reports from this outlet, the Bay Area native mentioned that Bitcoin is resilient, principled, native to the ideals of the Internet, and a great brand, in spite of cynics’ cries.
While this was jaw-dropping in and of itself, Dorsey made mention of his advocacy for the Lightning Network. In response to a tweet that outlined an idealistic system where people can tip satoshis for tweets (enabled via Lightning), the American entrepreneur noted that he “loves the idea.”
This one-liner, while innocuous in practically any other context, quickly catalyzed rumors that Dorsey’s Square, a fintech company with a higher valuation that Twitter, was hard at work on incorporating Lightning into its services.

Cool example of #BitcoinTwitter experimenting on the Lightning Network.
Torch received, now passing along to @starkness! #LNtrustchain https://t.co/YVMAv62fCN
— jack (@jack) February 5, 2019

Just days later, he took to Bitcoin bull Stephan Livera’s podcast to confirm these rumors. During the podcast, which also saw Lightning Labs chief executive Elizabeth Stark make an appearance, the Twitter CEO explained that Square’s integration of the scaling protocol is a matter of “when,” not “if.” Speaking on the rationale of eventually making such a move, Dorsey explained that his firm’s raison d’etre is to serve customers best, with Lightning only accentuating this goal.

He added that Square sees Bitcoin’s underlying nature as a currency, rather than solely a speculative asset. And as it stands, the widespread adoption of the Lightning Network is the most promising means to get to that end.
How Big Would Bitcoin Lightning On Square Be?
While Dorsey’s comments regarding his fintech upstart’s plans to integrate the Lightning scaling solution were open-ended, the magnitude of the future move was quickly comprehended.
Alec Ziupsyns, better known as RhythmTrader on Twitter, claimed that whatever form the integration takes, it will likely have a larger impact on the Bitcoin ecosystem than both Bakkt and a crypto ETF. This comment may have caught investors off-guard, especially considering the ever-growing thought process that a fully-launched Bakkt will be the startup to wrench Bitcoin out of this 12-month “crypto nuclear winter.”

Jack Dorsey says Lightning Network coming to Square's Cash App is a "when", not "if".
This will have a larger impact on bitcoin adoption than both Bakkt and an ETF.
The launch of the Bitcoin Network in 2009 was a global earthquake.
Now is time for the tsunami.
— Alec Ziupsnys (@AlecZiupsnys) February 11, 2019

Ziupsnys, who likened the initial launch of the Bitcoin Network to a global earthquake, added that the next phase of the asset’s life, which will involve Square’s Bitcoin offering, will be much like the subsequent tsunami.
Other industry insiders echoed Ziupsyns’ quip. In an interview with Tim Copeland of Decrypt Media, Jeremy Welch, the chief executive of Bitcoin hardware and software provider Casa, noted that Square’s (and Twitter by extension) support for Lightning would simply be “huge.” Welch explained that as Square is a “very well respected company,” with “great tech, great teams,” it’s doubling down on Bitcoin would be significant for both adoption and reputation. The entrepreneur explained:
“Silicon Valley hasn’t had the best view on Bitcoin overall. So, it would be significant on multiple levels, both in terms of adoption and their reputation and they have cachet with a lot of the bigger financial institutions.”
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Wall Street Crypto Advocate Says Bitcoin ETF Is A Matter Of When: What’s Behind the Confidence?

All eyes may be on the QuadrigaCX imbroglio, but talk regarding the implications that a Bitcoin exchange-traded fund (ETF) could propose have continued. This isn’t without reason. Since the Winklevoss Twins effectively started the race for a publicly-traded crypto fund, deemed a “paradigm-shifting” product by post, the subject matter has plagued the front pages of crypto’s media outlets.
Anecdotally, it has been said that the launch of such an investment opportunity could be the rocket booster that could take this industry to the proverbial ‘moon’. While discussions about crypto-backed ETF are often imbued with an overarching sense of uncertainty and disbelief, a leading pro-crypto Wall Street investor claims that such a vehicle is “virtually certain” to eventually come into existence.
Related Reading: No One Needs A Bitcoin ETF & Bakkt, BTC Already Is Money: Crypto Investor
Launch Of A Bitcoin ETF Is “Virtually Certain”
This optimistic comment came by the way of Ric Edelman’s appearance on CNBC’s “ETF Edge” segment. Edelman, who runs a preeminent financial services company that shares his surname, told the financial outlet that there an inevitability to a Bitcoin ETF, in spite of the current market concerns and conditions.
Speaking with Bob Pisani, the Philadelphia native explained that a Bitcoin-backed product making it through the hoops the U.S. Securities and Exchange Commission (SEC) throws at it is a question of “when,” rather than “if.” Edelman did laud the SEC’s efforts to keep this nascent sector clean though, likely referencing the fears of manipulation, a lack of liquidity, insufficient custodial offerings, and minimal market surveillance mediums.

Waiting on a #bitcoin ETF? @ricedelman says it's an inevitability. https://t.co/WGxnMOvoEy
— CNBC's ETF Edge (@ETFEdgeCNBC) February 11, 2019

Yet, the Edelman Financial Services chairman commented that he’s confident that eventually, innovators in this space will push proper solutions to combat the SEC’s harrowing concerns. He even noted that moves to leave the financial regulator’s worries in the dust have already begun to come to fruition.
In response to a question regarding custody, Edelman name-dropped Fidelity, explaining that the Wall Street powerhouse is nearing the launch of its digital asset-centric platform. Case in point, just a week ago, the Boston-based institution revealed that it will launch its crypto custody product in a few months, potentially by some time in March. The American investor also lauded Kingdom Trust, along with a “number of other very serious players” in the custody field. He even noted that in “very short order,” VanEck and its partners should be able to satisfy the SEC’s qualms, effectively explaining that the SEC’s custody box has been ticked.
He added that from a fundamental point of view, institutional demand for solving crypto’s issue only accentuates that there is capital, human resources, and energy backing a Bitcoin ETF. Thus, the investor concluded that:
“Eventually we will see a bitcoin ETF and it’s at that stage that I will be much more comfortable recommending that ordinary investors participate.”
Edelman’s pro-crypto ETF comments come as another hopeful has joined the fray. According to a document filed to the SEC on Monday, Eric Ervin’s Reality Shares, a crypto-centric investment services provider, a semi-Bitcoin ETF is seeking to launch on NYSE Arc. 15% of the fund’s assets will be allocated towards CBOE and/or CME Bitcoin futures, while the remaining will be left for sovereign debt instruments denominated in fiat currencies like the British Pound, Japanese Yen, Swiss Francs, along with money market mutual funds.
While the product will only have a maximum 15% allocation into Bitcoin futures, some claim that this unique feature should allow the product to get a noticeable foothold in the SEC’s chambers.
Pent-Up Demand For Crypto Investment Still Present
While the incessant stream of applications may create a cause for concern that this yet-to-launch market is already oversaturated, this could be far from the case.

Per previous reports from NewsBTC, a survey conducted by Bitwise Asset Management, a San Francisco-headquartered crypto investment services provider, revealed that 35% of 150 financial advisors based in the U.S. would advise their clients to purchase cryptocurrencies if an ETF saw a launch.
Tom Lydon, the head editor at ETFTrends.com, echoed this sentiment in an interview with CNBC. Lydon noted that 74% of the advisors his outlet has interviewed have talked to their clients regarding a Bitcoin investment, yet few have gone through with a bonafide allocation. But with this launch of an ETF, an allocation would become that much easier to procure.
It is more than clear that there is demand for such a form of investment, but will the SEC bite?
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Bitcoin Needs To Reach At Least $7,000 to Save the Mining Industry: Analyst

The economics of Bitcoin (BTC) is a touchy subject. Case in point, debates regarding the subject matter are the catalyst for some of the project’s leading forks. And while discourse regarding the subject has dissipated, especially as Craig Wright and Roger Ver have gone on their merry way, the long-term sustainability of Bitcoin’s consensus mechanism has recently come under fire.
Filb Filb, a leading crypto asset researcher, looked to bring rational thought and numbers to a facet of this non-parley on Sunday, releasing a Twitter thread on mining fees and their role in cryptoeconomics.
Related Reading: Block School: Basic Blockchain Theory and Cryptoeconomics
99% Of Bitcoin Mining Revenue Is Block Rewards
Filb first laid out some ground rules. Citing block explorer information, Filb noted that miners hashing on the Bitcoin network secured approximately $6.37 million, which includes the $70,000 paid in transaction fees, over the past 24 hours. In other words, effectively 99% of miners’ revenues are sourced from coinbase transactions, while what little is left is made up of pure, simple transaction fees.

Re; Bitcoin Mining Fees Debate;
Daily Miner income today of c.$6,37m inclusive of $70k fees can be easily maintained with assumed increase in $BTC unit price.
Mining fees are 1% of the total mining incomeBitcoins revenue is 99% of total mining income pic.twitter.com/Hxey0WHzvG
— fil₿fil₿ (@filbfilb) February 10, 2019

And as the cumulative value of network fees is expected to flatline, even drop, in the coming years due to the Lightning Network’s advent, the value of BTC must head higher to allow miners to keep aggregate revenues consistent. If the Bitcoin price stagnates, even as block reward reductions — so-called “halvenings” or “halvings” — occur, miners may begin to stifle their operations, as the economics of mining become tough on their wallets.
Thus, Filb remarked that BTC must eclipse $7,000 — near-double of today’s price — by 2020’s issuance reduction event, slated to occur in mid-May. By the same token, he claimed that as future halvenings activate, which will cut the amount of BTC issued in half, Bitcoin will need to continue to double every four years to keep the mining sector as is.
Yet, the analyst didn’t count out the chance that BTC could enter a multi-year lull, whereas prices aren’t fluid and don’t match current expectations, putting miners between a rock and a hard place. In fact, if the value of the flagship cryptocurrency remains static heading into 2020’s halvening, a sticky situation may arise.
If worst comes to worst, the current value of daily transaction fees would have to swell by 46 times, from $70,000 to $32 million, to keep risk to the status quo of miners’ revenues to a minimum. This, of course, is a worst-case scenario, especially considering the copious number of analysts who believe that the impending shift in issuance will push Bitcoin far beyond where it has traversed before.
As reported by NewsBTC previously, Moon Overlord claims that BTC could begin to rally into the May 2020 halving. Overlord explained:
“Bitcoin has traditionally starting pumping around 1 year on average before it’s halving date… The next halving is estimated to be May 2020, meaning that the uptrend will begin in May of this year.”
He isn’t the only analyst with this thought process. Alistair Milne, a Monaco-based crypto investor that heads the Digital Currency Fund, noted that December’s downward difficulty adjustment, which has historically indicated a bottom, and the nearing halving should be a catalyst for widespread accumulation.
The Case For A Bitcoin Supply Cap Hike
While Filb doesn’t believe that the fleeting block rewards could pose a cardinal risk to Bitcoin’s long-term, multi-decade security, some have begged to differ. In a shadowed conversation at the equally as mysterious Satoshi’s Roundtable, Matt Luongo, the founder of Fold and the product lead at Keep, stated that the Bitcoin’s deflationary model could get unsustainable over time.

Like thinkers like BlockTower’s Ari Paul, Luongo brought up the idea that as time elapses, more of Bitcoin’s functionality will be seen on second layers, sidechains, and drivechains. Thus, the Bitcoin economy could become “top heavy,” creating an environment where the underlying blockchain is susceptible to block reorganizations, due to the minimal low-cost transactions made on the mainchain and lacking block rewards.
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Bitcoin Investor Lost Life Savings When QuadrigaCX Didn’t Issue $422,000 Withdrawal

In a matter of weeks, the demise of QuadrigaCX, once Canada’s largest Bitcoin exchange, has reached the front pages of mainstream media outlets worldwide. Bloomberg, Reuters, and Fox Business are among the mass of notable outlets that have covered this debacle.
While their coverage of this situation has brought things to light that should be known, relatively little attention has been given to those affected, a purported 115,000. Some lost close-to-zero in funds, while others lost their life savings. Bloomberg recently sat down with one Canadian client of the platform, who lives in the same city that the exchange purportedly has headquarters in. His story wasn’t pretty. Please heed his story.
Related Reading: QuadrigaCX Reportedly Didn’t Lose Access to Bitcoin Funds – is it More Than a Mistake?
Vancouver QuadrigaCX User Loses $422,000 After Sale Of Bitcoin
Unfortunately, the QuadrigaCX case hasn’t been without its victims. In the aforementioned interview, victim Tong Zou explained his story. Zou, a thirty-something Canadian software engineer who held a variety of developing stints (BitTorrent, Spiget, Walmart, etc.) in Silicon Valley, moved to Vancouver just months ago in search of something new. As expected, Zou sought to move his savings, then situated in accounts of American financial institutions, which were valued at over $400,000.
While such a move is mandated, especially for so-called “repats” looking to start anew in their own home nation, Zou chose a peculiar route. This was, of course, to purchase Bitcoin on American exchanges, before moving said cryptocurrency holdings over to Canadian exchanges for subsequent liquidation.

Like many newcomers to the Canadian crypto economy, Zou was drawn in by QuadrigaCX, determining that the Vancouver-based exchange was the right platform for him to use. Maybe, he thought that he could visit the exchange’s ‘offices’ if things went south. Anyhow, he deposited his Bitcoin, effectively a majority of his liquid assets, and liquidated the cryptocurrency for $560,000 Canadian dollars.
As Zou needed the money for a deposit on a Vancouver property, he issued a withdrawal request. Yet, Quadriga failed to pay its dues, and left Zou hanging for months on end. He remarked:
“I wasn’t using it for trading — I just wanted to move my money over to my Canadian bank account… What I didn’t know was that my withdrawal would be pending or incomplete and it never got deposited in my bank account. I’ve been waiting four months so far.”
While online hearsay indicates that users receive their withdrawals… eventually, Quadriga’s sudden closure likely put a nail in the coffin for Zou, so to speak.
Zou, who believes that it isn’t curtains closed for the $422,000 that he is owed, is currently coordinating class-action efforts with his fellow victims, who have purportedly turned to Bennet Jones LLP and McInnes Cooper.
This recent harrowing story comes as Elementus, a blockchain research unit, divulged that there’s a chance that QuadrigaCX never held 430,000 Ethereum (ETH) in its supposed “cold storage” wallets. Rumor has it that the company never held $100 million worth of Bitcoin either.
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$3 Trillion Hedge Fund Industry Should Have 1% In Bitcoin (BTC), Claims Novogratz

Although undoubtedly Bitcoin rose to worldwide fame and glory in late-2017, institutions have been slow to make a bonafide foray into this asset class. In fact, effectively zero preeminent Wall Street funds have divulged that they have taken active stakes in cryptocurrencies. Many traditionalists would argue that this is for good reason, but crypto’s enthusiasts have been left asking — what’s the deal?
Novogratz: Where Are Bitcoin Allocations From Wall Street?
In a tweet issued on Saturday, Mike Novogratz, the chief executive of the TSX-listed Galaxy Digital, made a surprising remark that came straight out of left field. The former Fortress Investment and Goldman Sachs executive, who has become a full-on crypto diehard, explained that he doesn’t understand why large macro funds, such as Ray Dalio’s Bridgewater Associates, don’t have a 1% position in Bitcoin (BTC).

Don’t understand why all the big macro funds out there don’t have a 1 percent position in $btc. Just seems logical even if your prone to be a skeptic. @RayDalio #goldproxy #animalspirits #greatriskreward
— Michael Novogratz (@novogratz) February 9, 2019

Backing his comment, Novogratz added that such a move is logical “even if you are prone to be a skeptic,” likely touching on the asymmetric risk-return profile that cryptocurrencies are best known for.
For some perspective, Winton, a British investment management firm, estimates that hedge funds worldwide hold a minimum of $3 trillion in assets. Thus, a ubiquitous 1% allocation would see $30 billion rush into BTC at the bare minimum, which would push the cryptocurrency likely beyond its late-2017 high due to fiat multipliers.
While this would be crazy in and of itself, some argue that this is just the tip of the iceberg. In an installment of Off The Chain, Anthony Pompliano of Morgan Creek Digital Assets claimed that “every pension fund (valued at ~$4.5 trillion) should buy Bitcoin.” Pompliano explained that a potential solution to solve the pension crisis, whereas such funds will likely default on some, if not most of their payments, is to simply buy cryptocurrencies. Bitcoin, for one, is a non-correlated asset, with Pomp even calling it “the holy grail of any portfolio.”

This isn’t even an unproven fact. PlanB, a leading crypto researcher, recently remarked that a 1% BTC and 99% cash portfolio beat the performance of the entire S&P 500 over the last ten years. Although the difference between the two portfolios was marginal, with mere percentage points separating their performance, PlanB claimed that Bitcoin simply has a better risk-to-return profile than U.S. equities.
In response to this, Pompliano remarked that this trend is likely going to continue over the next decade.
Bitcoin Isn’t Only A Diversifier, But A Hedge Against Fiscal Irresponsibility
Not only is Bitcoin likely going to be a great diversifier in the long haul, but many argue that it is a perfect hedge against poor fiscal practices from central banks, like the U.S. Federal Reserve. In a comment given at an alternative investment conference in the Grand Cayman, Travis Kling, the chief investment officer of Ikigai, remarked that the flagship cryptocurrency is the perfect hedge against “fiscal and monetary policy irresponsibility.”
Kling, a former Point72 portfolio manager even likened Bitcoin to a credit default swaps (CDS) against central banks’ enamorment with printing money. The Ikigai head, who made a sudden U-turn at the peak of 2017’s crypto boom, as he downed a red pill to foray into cryptocurrencies, remarked that he’s wary of the build-up of debt on government balance sheets. Kling even stated that the monumental rise of enlisted quantitative easing (QE) strategies is “how you would write the script” for the adoption of cryptocurrencies, especially ones that are fully decentralized, the world over.
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Report: Philippines-Based Banking Giant Launching Two-Way Crypto ATMs

When you think of nations with a notable Bitcoin ecosystem, many crypto investors would immediately think of the U.S., Malta, Singapore, Japan, and South Korea. Yet, many draw little attention to the Philippines, a nation that is seemingly filled to the brim with cryptocurrency users.
A large financial institution based in the Philippines made a notable pro-crypto move last week — one that could potentially spark widespread adoption within the Asian nation.
Meet Union Bank’s Crypto ATMs
According to reports from Filipino media, Union Bank of the Philippines, a banking giant that is the seventh largest in the country, is launching crypto asset automated teller machines (ATM). The Philippine Star, who broke the news on the matter, cited a Union Bank press statement.
Related Reading: Are Bitcoin ATMs Driving Adoption, Criminality, or Consumerism?
Per the statement, the company launched its first two-way cryptocurrency ATM earlier this week, allowing customers to purchase and sell assets like Bitcoin for pesos. Union Bank has purportedly collaborated with the Bangko Sentral ng Pilipinas (BSP), the nation’s central bank, to ensure that this newfangled offering is compliant. The Manila-headquartered institution, which has over 300 branches smattered across metropolises and the countryside, remarked:
“In the bank’s continued quest to cater to the evolving needs and tastes of customers, including clients who use virtual currency, the ATM will provide these clients an alternative channel to convert their pesos to virtual currency and vice versa.”
In a comment on Twitter, NewsBTC’s Joseph Young remarked that Union Bank’s proactivity in the crypto space is not only good for regulation, but for awareness and adoption too.

HUGE: Union Bank of the Philippines is reportedly launching two-way crypto ATMs in the Philippines.
UB is one of the largest banks in the Philippines and has been proactive in the crypto space.
Good for crypto regulation, adoption, and awareness.https://t.co/YTVHnKzRZh
— Joseph Young (@iamjosephyoung) February 10, 2019

No reports indicate that Union Bank has plans to inaugurate more than a few Bitcoin-friendly ATMs at the moment. Regardless, this move only underscores the growing industry theme of ATMs that cast aside the shackles of the traditional financial system, which include fiat and payments processors like Visa and Mastercard.

Per previous reports from NewsBTC, Bitcoin Depot, a subsidiary of Lux Vending, is looking to prop up 30 ATMs in Chicago that support Bitcoin, Ethereum, and other digital assets in the coming months. While these efforts are centered around Chicago, a little-known crypto hotspot that hosts ErisX, hype regarding brick and mortar crypto purchases is a global trend, as there are now over 4,323 of these machines worldwide. And according to data from CoinATMRadar, this number is swelling by 5.6 each and every day.
Fiat To Crypto On-Ramps To Boost Bitcoin Over 2019
This venture in the Philippines comes as Fundstrat’s research team, which includes Rob Sluymer and Tom Lee, claimed that the rise in the fiat-to-crypto on-ramp sector will be a positive catalyst for Bitcoin in the coming year. According to a sneak peek of a Fundstrat report, the New York investment advisory outfit noted that influx of consumer interest in Bitcoin may be catalyzed by Binance’s recent addition of credit card crypto purchasing capabilities, along with other fiat-supported infrastructure from other upstarts.
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