Crypto Brief

233 Million Reasons Bitcoin And A Few Other Digital Currencies Will Win Survival Of The Fittest

There are over 1,500 digital currencies per coinmarketcap.com, with Bitcoin having the largest market cap at $200 billion. Ethereum, Ripple, Bitcoin Cash and Litecoin have market caps starting at $85 billion and dropping to $12 billion. The next 20 have market caps that are over $1 billion with the next 115 over $100 million. About half of the remaining digital currencies have market caps under $1 million. While having a larger market cap doesn’t mean a particular digital currency will become established, it certainly helps to give it credibility.

Some of the challenges to digital currencies being accepted are the relative newness of them, the ease that additional ones can be created and the total number of them. The SEC has warned investors about fraudulent ones and over $200 million seems to have disappeared from hundreds of recent Initial Coin Offerings, or ICOs. This could lead to the entire digital currency ecosystem fading away or it may mean that investors and companies will settle on a few of the strongest ones. It is too early to tell what will eventually happen, but given the money being invested in them and their potential use I would lean to the survival of the fittest playing out. Full article here.

Two Bullish Signs For Bitcoin

After a prolonged correction, Bitcoin is back big time. The “people’s currency” gained close to 7% this week, stabilizing around the $11,000 mark.

Is this comeback for real?

Hard to say, as there are hardly any “fundamentals” to judge whether Bitcoin is undervalued or overvalued at these levels. Still, there are a couple of bullish signs for the digital currency worth noticing.

One of them is that Bitcoin is beginning to behave like the ‘new gold,’ shining in times of extreme uncertainty that take over Wall Street.

There was a time when gold would shine as Wall Street faltered. That was long time ago, when it was the hedge against uncertainty. It was the asset where investors could park their cash in times of political and economic turmoil.

Now Bitcoin is taking its place, as evidenced by the performance of the two assets overtime. Full article here.

Coinbase User Files Class Action Against Company, Claims Insider BCH Trading

Coinbase, a major US-based cryptocurrency exchange and wallet platform, faces a class action lawsuit claiming that its employees and other insiders benefited from trading on non-public information that the exchange planned to introduce Bitcoin Cash (BCH) support last December, The Recorder Law reported on Friday, March 2.

The complaint was filed by Coinbase user and Arizona citizen Jeffrey Berk, represented by two law firms, in the US District Court for the Northern District of California on Thursday, March 1.

The introduction to the class action complaint brought against Coinbase explains that it is being made:

“on behalf of all Coinbase customers who placed purchase, sale or trade orders with Coinbase… during the period of December 19, 2017 through and including December 21, 2017... and who suffered monetary loss as a result of Defendants’ wrongdoing.”

In the lawsuit, the plaintiff accuses Coinbase of “artificially inflated prices” by means of disclosing buy and sell orders moments after Coinbase launched BCH support on Dec. 19, 2017. The move may have caused the price of the cryptocurrency to soar by over 130 percent — from $1,865 on Dec. 18 it reached as high as $4,300 by Feb. 20, according to data from CoinMarketCap. here.

Six hundred bitcoin mining computers stolen in Iceland

Some 600 bitcoin mining computers have been stolen in Iceland, in what is being described as one of the biggest thefts ever in the small island nation.

A total of 11 people have been arrested so far after four burglaries in the Reykjanes peninsula.

The computers are yet to be found and are believed to be worth almost £1.5m.

Icelandic media have dubbed the crime the “big bitcoin heist” and the thieves could potentially make more money if they use the computers to mine the cryptocurrency and then sell it.

"This is a grand theft on a scale unseen before," police commissioner Olafur Helgi Kjartansson said, NBC reported. "Everything points to this being a highly organised crime."

Bitcoin hit the news last year after its value increased by more than 20 times from below $1,000 to a peak of more than $20,000. Full article here.

JPMorgan's Bitcoin Jitters, Goldman Sachs' Crypto Bet, Uber Cofounder's Blue-Sky Ambition

While Friday’s nor’easter soaked the coast in all manner of precipitation, I pondered two other storms a-brewing in the business world: a correction in the cybersecurity market and the undeniable, insuppressible arrival of cryptocurrency.

First, cybersecurity concerns have raised tremendous sums of venture capital in recent years—and now we’re beginning to see a shakeout. Private market money ain’t as free-flowing as it once was. Companies like Ping Identity, McAfee, Barracuda Networks, and now PhishMe (since renamed “Cofense”) have sold wholly or in part to private equity buyers. As funding and prospects for exits thin, expect more companies to have a harder time justifying inflated valuations.

Meanwhile, the cryptosquall bears down in full force—and if you listen close, you can hear the joints of the financial establishment creaking. Following the lead of Bank of America, J.P. Morgan Chase warned investors for the first time in its annual report that cryptocurrency could pose a risk to its business. (For more on that, see this newsletter’s “access granted” section below.) In the same week, Circle, a Goldman Sachs-backed financial tech startup, shocked the public by buying a cryptocurrency exchange, news first reported by yours truly. And Garrett Camp, cofounder and chairman of Uber, unveiled a proposal for a brand new cryptocurrency, called Eco, that he hopes to transform into a global payment system. Full article here.

US: TechCrunch Founder’s Crypto Fund Becomes Yet Another Target Of SEC Crypto Probe

TechCrunch founder Michael Arrington’s $100 mln cryptocurrency hedge fund has received a subpoena from the US Securities and Exchange Commission (SEC) as part of their recently uncovered cryptocurrency industry probe, CNBC reported Friday, March 2.

Arrington told CNBC that while it’s true that his Arrington XRP Capital fund received a subpoena, “every [crypto]fund I've talked to has received one.” Emphasizing his willingness to comply with crypto-specific regulations, should they be introduced, Arrington continued:

"That's fine. They [the SEC] just have to figure out what they want. They need to set up rules so we can all follow them, and the market is begging them for that."

Multiple news outlets, including CNBC, have reported that a total of 80 firms have already received subpoenas from the SEC.

Arrington’s comments echo those of Overstock CEO Patrick Byrne, whose crypto subsidiary was also subpoenaed by the SEC this week. Byrne said he “actually supports” the cryptocurrency enquiries overall, adding: Full article here.

Young South Koreans lured by cryptocurrencies struggle with bust after the boom

NAMYANGJU, South Korea — Jumping on a national frenzy over cryptocurrencies, 24-year-old Juwon Park scraped together some of her savings and in December gambled $2,500 on the investment trend sweeping South Korea.

Park, a former Google intern who is now a business writer, had been riveted by a man on television who bragged that he transformed $80 into $23 million — all by trading in the virtual currency. It sounded too good to be true. And for Park, and other South Koreans like her pining for financial independence, it has been.

"I didn't want a fortune," she said last month on the first day of the Lunar New Year, a family-centric holiday celebrated across Asia.

"I just wanted enough to give me that glimmer of hope,” she said. "Now it's gone." Full article here.