“Education is an ornament in prosperity and a refuge in adversity.”
Happy Friday 😊, but not so happy crypto markets 😔. It's been yet another rough week for the crypto sphere and it certainly isn't the best way to end the week, but let's all take a nice breather, enjoy the weekend ahead of us and come back mentally sharp on Monday. 💪 But first, do enjoy today's newsletter! 😂
Today in history (1941), Japanese planes raided Pearl Harbor, Hawaii. The attack, commonly known as "Battle of Pearl Harbor", prompted the U.S. to enter the fray in WWII. The event killed 2,335 and wounded 1,143. 🙏🏻
In today's newsletter, we will be covering the U.S. SEC extending its review period on the VanEck-SolidX Bitcoin ETF proposal, crypto exchange Binance's new sub-account feature for institutional investorsandMorgan Creek Digital's $1 million bet.
Please don't forget to answer the polls down below too! It's a great way for us to interact with you, and it's always nice hearing your thoughts. 💭 Happy reading! 📚
Down the rabbit hole 🐰
Absolutely brutal. In the past 24 hours, BTC set a new 2018 record low, dropping to ~$3,310 at one point, before proceeding to slightly recover to ~$3,440 where it is currently trading for a ~10.4% loss for the day. 📉
RSI on the weekly chart is at ~29.7, setting another record low for the year. The last time we had seen such a low RSI on the weekly chart was almost 4 years ago in Jan 2015! 😔 With the price action today, BTC once again fell outside its lower Bollinger Band for the second time this year, indicative that it is currently trading 1 standard deviation below its 20-day SMA. It is evident that current bearish momentum is overwhelmingly strong, but MACD indicators on the weekly chart seem to suggest that it's about to get worse. 🐻
Total market capitalization currently stands at ~$108.9 billion, down ~$10 billion from yesterday. Most cryptocurrencies are seeing double digit losses in the ~15-20% range. ETH is currently trading at ~$87.4, a level is has not seen since May 2017. 🤕
Patiently waiting ⏳
The U.S. SEC is extending the review period of the VanEck-SolidX' Bitcoin ETF proposal to 27 Feb 2019 which, under SEC rules, requires the SEC to make a firm approval/ rejection decision on it by that date as it no longer can be further delayed. 😞
VanEck and SolidX's proposal was first submitted early this year, and along with 9 other ETF proposals from the likes of ProShares, GraniteShares and Direxion, got theirs rejected. A day after, the SEC announced that it would suspend the rejections and review them again and reopened up a comment period through which the general public could share sentiments regarding the ETFs. 👀
VanEck-SolidX's proposal differs from the other 9 in that its value is dependent on BTC itself, rather than futures markets. 👍
Taking it to the next level 🧗
Crypto exchange Binance has added a new sub-account feature that enables institutions to set up multiple trading sub-accounts, each with varying levels of access and control. 😍
A firm's main account can manage and control up to 200 sub accounts, by viewing all data, transferring funds between sub-accounts and having the autonomy to cancel any order placed. Sub-accounts will also be permitted to transfer funds with no fees and unique API limits per sub-account, thus allowing them to trade at a greater capacity than usual. 🤖
The new feature roll out is made available to institutional investors on Binance that have cleared the "Tier 3" assessment which currently requisites a 1,000 Binance Coin (BNB) balance and at least 4,500 BTC in trading volume over the past 30 days. 👍
Putting money where your mouth is 🤑
Morgan Creek Digital, a crypto index fund managed by Bitwise Asset Management, is offering a $1 million bet to any professional investor or firm that an index fund containing BTC, ETH, BCH, EOS, LTC, XMR, ZEC, DASH, IOTA and NEM will outperform the S&P 500 in the next 10 years. 😲
According to Morgan Creek Digital founder, Anthony Pompliano, cryptocurrencies have "outperformed over the last 10 years" and he believes that it "will not change moving forward for the next 10 years”, citing increasing wallet numbers and nodes supporting the network as a strong reason for this. 💪
Should any one take up the bet, it will commence on 1 Jan 2019 and conclude in 2029. 🤑
Crypto deep dive: Qtum (pronounced 'Quantum')
Market Capitalization Rank: 34th ($143 million)
Consensus: Proof-of-Stake Version 3 (PoSv3) - created by Pavel Vasin, and was built for UTXO based blockchains.
Notable Supporters: Roger Ver (Bitcoin Cash), Anthony Di Iorio (JAXX Wallet), Bo Shen (Fenbushi Capital), Jeremy Gardner (Augur), Xu Star (OKCoin)
The gist of it ⚙️
It is a smart contract platform used to develop decentralized applications.
It is an open-sourced hybrid platform that merges Ethereum’s smart contract network with Bitcoin’s value transfer protocol, so as to allow sidechain integration.
Why people love it 😘
QTUM has high compatibility. It utilizes the Ethereum Virtual Machine (EVM), such that any Ethereum smart contract can run on Qtum and vice versa.
QTUM was built with mobile and IoT compatibility in mind. Users can create and interact with smart contracts using their mobile apps. It might be the good direction to go into as it represents convenience and ease of access.
QTUM has a technically strong and sound team. Members come from BTC and ETH communities as well as companies like Baidu, Alibaba, Tencent and NASDAQ. QTUM also has the backing of several prominent blockchain figures like Anthony Di Iorio (Co-founder of ETH) and Roger Ver (Bitcoin Cash)
Why people doubt it 🤔
The smart contract platform space is pretty saturated at this point. They face steep competition in this regard.
It's decentralized application adoption levels are still very small compared to the likes of Ethereum or even Neo.
Some argue that Qtum's marketing is too Asia-focused. In order to more effectively compete with other smart-contract chains, it needs a more aggressive marketing push.
Other news 📰
According to a recent filing with the United States Patent and Trademark Office (USPTO), Coinbase is seeking to trademark "BUIDL." 😂💪
BitGo has hired a trust company industry veteran, Richard J. Corcoran, to head its institutional custody business, BitGo Trust Company. 🤝
ConsenSys is letting go of 13% of its staff due to a "streamlining (of) several parts of the business." 😥
Poll of the Day
In reference to the $1 million bet by Morgan Creek Digital (see above):
On a scale of 1-10, how confident are you that BTC will outperform the S&P 500 in % gains by 2029. 💭
And...where do you usually store your cryptocurrencies? Share with me in the polls! 😆
What you said
"On a scale of 1-10, how much faith do you have in storing your cryptocurrencies in crypto exchanges?" 💭
The average vote was 6.3. Not too high, as it should be. Always take extra precaution when storing your cryptocurrencies in a crypto exchange. As it is susceptible to a centralized point of failure, your tokens are never 100% safe.
You guys said:
Possibility of hacking - You're totally right. It ain't 100% safe. 🤔 Well all I want for Christmas is a hardware wallet a hardware wallet a hardware wallet 🎼🥁💸🧰🔑🗜🗄📓🔓 👜 - Always check to see if the person who gifted it to you got it from a third party vendor. If it is, don't use it! There have been many cases where these hardware wallets were already compromised and resealed. GOLDEN RULE If you don't own your private keys, you don't own your bitcoins / cryptocurrencies. - Great rule to abide by. 👌 Uncertainty and newness of it all. I keep my crypto currencies on my wallet. - Good job! That is the most secure way. 👍 Because I use Binance - Binance is still a centralized exchange. Although its security may be comparatively higher than that of other crypto exchanges, it it still a centralized exchange and you do not own your private keys. As a result, you are still prone to losing your coins if Binance gets hacked. 👀 They rarely fail but there’s still too much of a chance they could get hacked etc. - When it comes to token security I believe we should adopt a strict black and white policy. It only needs to happen ONCE! You could lose it all. It has happened to friends before. 😔 I've never heard anything negative about the one I use, however we all know that hacking an exchange is posssible. - It very well is. Recall Mt. Gox, which at the time was the biggest exchange. 🤔 It depends on the exchange you use. My favorite is Coinbase, although the commissions are somewhat high - Coinbase isn't safe too... Never had a problem - It only needs to happen once... 😉 I trust larger exchanges but know they can be hacked. It is much easier to have funds on exchanges rather than wallets. If they could guarantee the funds like banks for a certain amount it would be huge. Or have some form of custody. - Until there is some sort of insurance in place, we should use crypto exchanges as hot wallets only used for trading before transferring the tokens back to cold wallets. 🙏🏻 With storing cryptos on exchange I can distribute risk to multiple location/exchanges while storing my own key you have single point of failure or need to manage private keys. Exchanges can be hacked but you can recovery with your passport and etc, but if we lost private key it is gone forever - You're picking the greater of both evils here. That's why it's important to store your private keys away in a safe place. Personally, I store my private keys in my... 😏 It depends on the exchange. I'm usually chill with Binance but always with a grain of salt. - Might be a good idea to split up your assets! 👍 I feel it's safer than in a bank - Not unless its a cold offline wallet!
No FDIC! I guest it is a confidence issue like most people that really can't lose it all... If you know how to trade then you first get to know the 'exits'... How to get in and get out is not that hard. It's learned, and the quality of this newsletter does reassure me of my gut feelings. So, yes! it's growing daily... I will get to 10 by May 2019... Maybe before... Thanks for asking. - Be careful! It shouldn't be a 10. Crypto exchanges are never the safest option because of you do not own your private keys. It does not matter if it's the biggest or smallest crypto exchange out there. Remember what happened to Mt. Gox? It was the biggest exchange at the time.
"Where do you usually store your cryptocurrencies?"
I personally use a combination of both. Whatever the case, always set up 2fa for your crypto exchange accounts! 👌 Additional security precautions are always a good decision. Imagine making a killing from well researched and executed trades, only to lose it all from a hack.
Thank you all for reading thus far! Catch you back here again next week! 💙
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