The number of crypto hedge and venture capital funds is increasing at a fast pace this year, already reaching a total of 466, despite the bearish market trend and continuing regulatory uncertainty. 96 new funds have been founded by the end of July, according to a new study whose authors believe this year’s number will exceed the record 156 launched in 2017.
96 New Crypto Funds Founded In 2018
In a year of falling prices across the board, stubborn bearish market trend and persistent regulatory uncertainty, one would think this might not be the best time to deep dive into crypto. Some, however, see opportunities. Recently released data shows that 96 new crypto hedge and venture capital funds have been founded through July 31, this year.
According to a study conducted by Crypto Fund Research, a provider of market intelligence on cryptocurrency investment funds, 2018 is in fact on the way to surpass 2017, “The Year of Bitcoin,” when it comes to the number of crypto fund launches. If the current pace of opening new crypto investment funds is maintained, their number is projected to reach 165 by the end of the year, compared to 156 launched last year.
The cities that have hosted the biggest number of new crypto funds are San Francisco – 9, New York – 6, Singapore – 5, and London – 4. Cities like Austin, Dallas, Hong Kong, Philadelphia, San Diego, Tokyo, and Zug, where the Swiss Crypto Valley is based, have also seen multiple fund launches this year.
More than half of all crypto funds currently in existence have been established in the last 18 months, according to another finding in the report. Their total number around the world has reached 466, Crypto Fund Research claims. Quoted in a press release, the company’s founder Josh Gnaizda commented:
"We expected a large number of new crypto funds to launch in 2018 to satisfy growing investor demand. However, the pace of new fund launches is a bit surprising given the dual headwinds of depressed prices and less than favorable regulatory conditions in many regions."
Is There Enough Space for All of Them?The authors of the study note that if 2017 was “The Year of Bitcoin,” 2018 is shaping up to become “The Year of the Crypto Fund.” They also point out that while investors await decisions from regulators regarding new investment vehicles such as the Vaneck Solidx bitcoin ETF, crypto fund managers are setting up new funds in hope to take advantage of what they perceive as unmet demand for crypto investments.
In further comments, Mr. Gnaizda expresses doubts about the capacity of the crypto space, under the current circumstances, to accommodate so many funds: “While volatility in the crypto markets can attract some investors to sophisticated crypto funds, it remains unclear if the industry can support such a large number of funds, with limited track record, if we experience an extended bear market,” he said quoted by PRweb.
Despite the impressive growth in the number of crypto funds, the capital they control remains limited – about $7.1 billion USD, and the researchers stress this is far less than what many of the top traditional hedge funds manage. At the same time, the majority of institutional investors are still waiting on the sidelines and many crypto fund managers hope this will change in the near future.
Do you think the growing number of crypto funds indicates optimistic expectations about the future of the crypto industry? Share your thoughts on the subject in the comments section below.
Bitcoin's (BTC) close today will likely decide the short-term trend in prices.
The leading cryptocurrency snapped a three-day losing streak on Thursday as the 26 percent sell-off witnessed in the last three weeks was looking overstretched.
What's more important is that BTC traded yesterday within the high and low range of the previous day, indicating the bears have likely run out of steam and the bulls are still reluctant to enter the market at these levels.
So, it is safe to say that the bitcoin market has turned indecisive in the last 24 hours and a stronger corrective rally could be seen over the weekend if prices find acceptance above the previous day's high of $6,628.
However, it is going to be a tough task as the cryptocurrency is currently trading at $6,350 on Bitfinex – down 4 percent from the highs seen yesterday. A close (as per UTC) above $6,628 (previous day's high) would confirm a short-term bear-to-bull trend change.
On the other hand, if prices close today below $6,183 (Thursday's low), then BTC could resume the sell-off toward the June low of $5,755. As of now, this scenario appears more likely as 5-day and 10-day moving averages (MA) are trending south and their steep slope is indicating that BTC is under strong bearish pressure.
Further, the short-duration charts are biased toward the bears. A bear flag breakdown, if confirmed, would open the doors to $5,240 (target as per the measured height method), although the target looks far-fetched as of now. That said, it could easily yield a drop to the June low of $5,755.
The relative strength index (RSI) has breached the rising trendline in favor of the bears. Hence, the probability of BTC witnessing a bear flag breakdown in the next few hours is high.
The Ethereum network is experiencing copious transactions all connected to a single account, leading to broad speculation about their purpose.
A strange series of transactions on the Ethereum network began yesterday, leading to speculation that the network was the victim of a spam attack. The transactions are all connected to a single address, which is now involved with the bulk of Ethereum transactions.
Starting around 2:45 UTC Monday, the address in question received its very first transaction, a transfer of 0.02 Ether. In the next fifteen minutes, 600 transactions were made to that same address.
The transactions have continued at that pace, with the address racking up more than 48,000 transactions in the last 30 hours. Most of these transactions involved the transfer of 0.02 Ether and had a transaction fee of around 0.004 Ether. This means that if it is an attack, it has been a fairly expensive one for whoever is orchestrating it. The total transaction fees likely exceed 160 Ether by now (a value of somewhere in the neighborhood of $61,000 at time of press).
Several comments on Etherscan indicate some believe the transactions were a coordinated spam attack on the network. One user wrote:
"It's a botted ring wallet system with nearly 150,000 to 200,000 [Ether] in it. The bots translate random addresses to other random addresses and random amounts of eth to make them difficult to spot on block history."One commenter even speculated rival blockchain EOS was coordinating an attack. EOS members are planning a stress test on the EOS system tomorrow, hoping to set a record for transactions-per-second – a feat that would be particularly notable against the backdrop of Ethereum suffering another network slowdown.
EOS members have been accused of attacking the Ethereum network before. A spam attack that Vitalik Buterin estimated cost attackers $15 million occurred in July; many blamed EOS for that attack, though no one provided any proof. Dan Larimer of block.one denied the accusations, saying EOS would not spend the required money to attack Ethereum, especially since, as he put it, "all it takes is CryptoKitties" to bring down the network.
Others speculated, perhaps more plausibly, that the traffic is the result of a game being played on the network – in this case, a dubious lottery-style game called Fomo3D, in which players bid on a jackpot. After each bid, more time is added to a countdown clock, allowing for additional bids. Ultimately the last bidder wins the jackpot.
While there are still no definitive answers about what exactly is happening on Ethereum right now, there is a depressing possibility that Ethereum, which previously reached the heights of its usage as a platform for buying and selling virtual cartoon cats, is now feeling its limits pushed by a game that is essentially a Ponzi scheme.
A Florida county tax collector has partnered with bitcoin payments processor BitPay to accept cryptocurrency for a variety of services.
Seminole County Tax Collector Joel Greenberg said in a statement Monday that his office will take bitcoin and bitcoin cash for payments associated with driver licenses and ID cards, automobile tags and titles and property tax.
The office decided to accept the cryptocurrencies in an effort to streamline fee collection, reduce the potential for fraud and identity theft and increase the transparency and accuracy of payments. Greenberg's office added that it does not perceive any "price volatility or risk to the County" in accepting the cryptocurrencies.
Greenberg said in the statement:
"The aim of my tenure in office is to make our customer experience faster, smarter and more efficient, and to bring government services from the 18th century into the 21st century and one way is the addition of cryptocurrency to our payment options."
The collaboration with the Seminole County Tax Collector marks BitPay's first government partnership. Head of compliance Jeremie Beaudry said the company was launched because "we recognized the potential for blockchain to revolutionize the financial industry, making payments faster, more secure and less expensive on a global scale.
"With the Seminole County Tax Collector's office, we have engaged our first government agency to accept bitcoin and bitcoin cash by making it easy and seamless for them," he added.
However, Greenberg's office is not the only local government entity that has entertained the idea of accepting cryptocurrency for taxes.
Arizona and Georgia lawmakers both proposed bills this year that would allow citizens to pay their state tax liabilities in bitcoin and other cryptocurrencies, though neither bill made it through their respective legislatures.
Article found on www.coindesk.com
Image found on www.flickr.com
A new — and theoretical — system for blockchain-based data storage could ensure that hackers will not be able to crack cryptocurrencies once the quantum era starts. The idea, proposed by researchers at the Victoria University of Wellington in New Zealand, would secure cryptocurrency futures for decades using a blockchain technology that is like a time machine.
You can check out their findings here.
To understand what’s going on here we have to define some terms. A blockchain stores every transaction in a system on what amounts to an immutable record of events. The work necessary for maintaining and confirming this immutable record is what is commonly known as mining. But this technology — which the paper’s co-author Del Rajan claims will make up “10 percent of global GDP… by 2027” — will become insecure in an era of quantum computers.
Therefore the solution to store a blockchain in a quantum era requires a quantum blockchain using a series of entangled photons. Further, Spectrumwrites: “Essentially, current records in a quantum blockchain are not merely linked to a record of the past, but rather a record in the past, one that does not exist anymore.”
Yeah, it’s weird.
From the paper intro:
Our method involves encoding the blockchain into a temporal GHZ (Greenberger–Horne–Zeilinger) state of photons that do not simultaneously coexist. It is shown that the entanglement in time, as opposed to an entanglement in space, provides the crucial quantum advantage. All the subcomponents of this system have already been shown to be experimentally realized. Perhaps more shockingly, our encoding procedure can be interpreted as non-classically influencing the past; hence this decentralized quantum blockchain can be viewed as a quantum networked time machine.
In short, the quantum blockchain is immutable because the photons that it contains do not exist at the current time but are still extant and readable. This means the entire blockchain is visible but cannot be “touched” and the only entry you would be able to try to tamper with is the most recent one. In fact, the researchers write, “In this spatial entanglement case, if an attacker tries to tamper with any photon, the full blockchain would be invalidated immediately.”
Is this possible? The researchers note that the technology already exists.
“Our novel methodology encodes a blockchain into these temporally entangled states, which can then be integrated into a quantum network for further useful operations. We will also show that entanglement in time, as opposed to entanglement in space, plays the pivotal role for the quantum benefit over a classical blockchain,” the authors write. “As discussed below, all the subsystems of this design have already been shown to be experimentally realized. Furthermore, if such a quantum blockchain were to be constructed, we will show that it could be viewed as a quantum networked time machine.”
Don’t worry about having to update your Bitcoin wallet, though. This process is still theoretical and not at all available to mere mortals. That said, it’s nice to know someone is looking out for our quantum future, however weird it may be.
This article originally appeared on TechCrunch
Ether’s price achieved a new milestone by moving above $1,000 against the US dollar. Both ETH/USD and ETH/BTC are showing bullish signs.
Technically, the 2-hour chart indicators are gaining momentum in the bullish territory.
ETH/USD to Settle above $1,000?
In the Ethereum Forecast 2018 article, we discussed ETH/USD moving above the $1,000 milestone level. The pair gained solid bullish momentum during the past two days, and today it was able to move above the $1,000 level at a few exchanges. As of writing, the average price high was $996.67.
Similarly, ETH/BTC also gained a lot of momentum and was able to move back above 0.0600BTC after completing a correction. The upside move was strong since the pair also broke the 0.0680BTC resistance and is currently approaching the 0.0700BTC level.
Looking at the 30-minute chart of ETH/USD, there is a clear major bullish trend forming above $950.00. The pair traded above yesterday’s high and traded to a new all-time high of $996.67 (average price).
During the upside move, the pair broke the $950.00 resistance to move toward $1,000. Should the current momentum stay intact, there can be more gains in Ether’s price above the mentioned $1,000 level.
Moving up to the 2-hour chart, there are two major bullish trendlines forming with support at $920.00 and $840.00. Both trendlines are significant and are likely to prevent downsides from the current levels.
On the upside, ETH/USD will most likely attempt to move past and settle above $1,000. Above the mentioned $1,000 level, the pair could accelerate gains toward the $1,040 and $1,100 levels.
Important Resistance Levels
$1000.00 and $1100.00
Important Support Levels
$950.00 and $920.00
The RSI is heading into the extreme overbought conditions with no sign of a downside correction.
The MACD is gaining heavy momentum in the bullish zone.
By Aayush Jindal
Guest Analyst ETHNEWS.COM
Stellar has grown exponentially since the start of the new year. It briefly surpassed $.90 and is currently trading at $0.879150 USD (64.39%) 0.00005916 BTC (61.97%).
Yves Mersch is worried that bitcoin may threaten financial stability as “market infrastructures such as stock exchanges enter this business.”
The ex-governor of the Luxembourg Central Bank, Yves Mersch, serves as a member of the executive board of the European Central Bank (ECB). In a recent interview with German newspaper Börsen-Zeitung, Mersch discussed the dramatic rise in the price of bitcoin.
Noting the "comparatively low" volume of bitcoin exchange, Mersch said, "Bitcoin trading is not at present an issue for monetary policy." He was quick to point out market exuberance, but soberly allowed that consumers are essentially free to do with their finances as they please:
"Regarding the increase in price, we are seeing speculative hype that might be a cause for concern. But of course individual investors are free to gamble. However, if something goes wrong, they should not come to us and say we should have outlawed it and protected them from themselves."Mersch estimated the turnover of bitcoin at between 250 billion and 350 billion euros, but it's unclear what timeframe he was utilizing or how he arrived at that figure.
Regardless, given the divisibility of bitcoin and the prevalence of exchangeswithout fees (which might artificially inflate their volumes to attract customers), bitcoin's overall trading volume might not be the most reliable metric to examine. Distinguishing between legitimate market activities and trading bots is crucial to calculating the actual size of the market, and thereby determining potential effects on conventional markets.
Mersch also expressed concern about financial institutions, which are now dabbling in bitcoin. "There are now banks which hold positions in Bitcoin," he said. "It is a matter for the supervisors to judge how big the risks are."
As ETHNews reported in August 2017, Falcon Private Bank (headquartered in Zurich, Switzerland) announced plans to allow clients to purchase cryptocurrencies including Ether, Litecoin, and Bitcoin Cash. This occurred just one month after Falcon Bank added support for bitcoin.
But even the introduction of cryptocurrencies into banking systems seems somewhat limited. The scale of cryptocurrency holdings appears relatively small as compared to typical fiat holdings, and the probability of a bank default seems pretty low.
The real root of concern is in how bitcoin – and, perhaps, other cryptocurrencies – might interplay with the larger financial markets.
Mersch said that he is most concerned about "when financial market infrastructures such as stock exchanges enter this business. That poses a major threat to financial stability."
He's not the first person to realize the danger of mixing conventional finances with the untested cryptocurrency market. In November 2017, Interactive Brokers CEO Thomas Peterffy voiced very similar concerns about bitcoin futures.
"If these [bitcoin] transactions are kept separate from others [of the conventional variety], it's a secondary matter who wins and who loses," explained Mersch. "However, if all the participants in these financial centres are jointly liable, that can create difficulties, for instance, for banks or the whole system."
Indeed, it's critical to delve into how the members of a clearing organization might be held liable for gains or losses.
"And if the banking system gets into trouble," he added, "there will again be demands for support from the ECB. I would say from the outset: we shouldn't do this."
When asked if private cryptocurrencies could become a "real alternative" to central bank money, Mersch deflected.
"Money needs trust," he said. "Public currencies, for example the euro, have the backing of public institutions such as the ECB. Many of these [private] currencies have no backing, nothing."
However, Mersch smartly differentiated between bitcoin itself and bitcoin's "underlying technology, the blockchain."
"It's a somewhat different matter for the underlying technology, the blockchain. That's a challenge we all have to face, especially banks. Each institution has to know that in the future financial intermediation will no longer be heaven-sent, but has to be fought for."Previously, Mersch implored banks to deliver instantaneous payment services for conventional fiat currency.
By Matthew De Silva ETHNEWS.COM
The South Korean government announced new legislation today that would put increasingly tough regulations on the country’s burgeoning cryptocurrency markets. Under the legislation, Korea, which is the third largest market for cryptocurrencies in the world after the U.S. and Japan, would ban anonymous accounts and continually monitor crypto exchanges.
Perhaps more ominously, the Wall Street Journal reported as well that the Ministry of Justice is considering unilaterally closing all crypto exchanges in the country, although didn’t provide any detailed guidance or timelines on when such a policy might be enacted.
The news slammed cryptocurrency prices. Bitcoin was hit about 12%, dropping from around $15,500 to eventually hitting a bottom of $13611, according to Coindesk. Ethereum was hit about 8% in the aftermath of the news.
The proposed legislation on anonymous accounts is in line with recommendations from the Korea Blockchain Industry Association earlier this month which declared that currency operations between Korean Won and cryptocurrency-denominated accounts should only be allowed in cases where the identity of the account holder has been confirmed. 14 member exchanges agreed to that proposal.
The absolute frenzy of cryptocurrencies has taken the country’s leadership by surprise, and the government has raced to change laws to facilitate and regulate the industry. Earlier this month, the government also announced that it intended to tax cryptocurrency gains as capital gains in an attempt to stem the onslaught of cash coming in from Korean consumer investors.
Despite wide popularity among the Korean public, there have been increasing concerns that Korea’s exchanges are insecure. Last week, one of the most prominent Korean cryptocurrency exchanges, Youbit, collapsed following a $35 million hack earlier this month. That was after a $72 million hack on the exchange in April.
As I discussed last week on TechCrunch, there is increasing evidence that North Korea has been using bitcoin trading as a key side business moneymaker for the Kim regime. Through hacks on traditional banks and its threatening nuclear weapons posture, the regime has attempted to undermine faith in traditional institutions, pushing more investors to cryptocurrencies as a safer, more stable bet. Eliminating anonymous accounts would be one step to help prevent the North from infiltrating the South’s crypto infrastructure.
Litecoin, the fifth-largest coin by market cap has seen it's value explode over the past 48 hours. It is currently trading above $350 on most exchanges. With this excitement also comes a sobering reality as emphasized by Litecoin creator, Charlie Lee.
The former director of engineering at crypto exchange Coinbase tweeted a warning for potential litecoin holders Monday night:
"Ok, sorry to spoil the party, but I need to reign in the excitement a bit…," he wrote. "Buying LTC is extremely risky. I expect us to have a multi-year bear market like the one we just had where LTC dropped 90% in value ($48 to $4). So if you can't handle LTC dropping to $20, don't buy!"
I appreciate Charlie for being straight forward with his opinion and I continue to gain increasing respect for Litecoin and what he's doing with the currency.
by Whit Gallimore
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