Newsletter June 13th 2018
CFTC opinion on future of cryptocurrencies June 4th
The commissioner of the CFTC, Rostin Behnam, stated that
“virtual currencies may – will – become part of the economic practices of any country, anywhere. Let me repeat that: these currencies are not going away and they will proliferate to every economy and every part of the planet. Some places, small economies, may become dependent on virtual assets for survival. And, these currencies will be outside traditional monetary intermediaries, like government, banks, investors, ministries, or international organizations.
We are witnessing a technological revolution. Perhaps we are witnessing a modern miracle.”
Takeaway: The statement from the commissioner of the CFTC serves as a reliable public service announcement that cryptocurrencies will proliferate. His statements make the outlook for cryptocurrencies look more bullish.
SEC Chief clarifies cryptocurrencies and securities (June 5th)
Jon Clayton, the chief of the SEC made two statements regarding cryptocurrencies and tokens.
“Cryptocurrencies: These are replacements for sovereign currencies, replace the dollar, the euro, the yen with bitcoin. That type of currency is not a security. A token, a digital asset, where I give you my money and you go off and make a venture, and in return for giving you my money I say ‘you can get a return’ that is a security and we regulate that. We regulate the offering of that security and regulate the trading of that security.”
Takeaway: Cryptocurrency holders will not have to worry about Bitcoin and similar cryptocurrencies being classified as a security, but they may have to worry about the status of tokens distributed by ICOs.
Mike Novogratz Talks Cryptocurrencies and Regulation (June 5th)
Mike Novogratz publicly explained why he thinks the cryptocurrency industry could see a $20 trillion market cap size. To paraphrase, he said that cryptocurrency adoption will occur once cryptocurrencies scale, which will probably be in up to four years. To watch his full interview please visit https://youtu.be/oWhzlaymNIk
Takeaway: A financially successful person explaining why they think cryptocurrencies have a future is good for the industry. Novogratz’s interview has over 75,000 views and may entice people to believe in the utility of cryptocurrencies.
CoinBase News (June 6th – June 12th)
Coinbase is on track to become a US-regulated blockchain securities trading venue June 6th
Coinbase acquired a broker-dealer license, an alternative trading system licence, and a registered investment advisor license, which puts it one step closer to being a US-regulated blockchain securities trading venue. If approved by the SEC and FINRA, Coinbase will be able to offer many more altcoins, margin and over the counter trading, and new market data products.
Takeaway: Adding more cryptocurrencies and features to Coinbase would be a big leap forward for cryptocurrency adoption. Coinbase is the most popular gateway for new American cryptocurrency investors and exposure for more altcoins could lead to more money entering the industry. Additionally, more Coinbase features like margin and over the counter trading could lead to large institutional investments.
Coinbase adds Ethereum Classic June 11th
Coinbase announced that it will support Ethereum Classic trading in upcoming months.
Takeaway: Coinbase adding Ethereum Classic is good for Ethereum Classic holders because cryptocurrency newcomers that use Coinbase as their cryptocurrency gateway will then recognize Ethereum Classic. The news also means that Ethereum Classic will be included in Coinbase’s index fund, which means that big investors will probably be investing into Ethereum Classic. Taking a step back, it will be a bit confusing for newcomers because Coinbase will offer Bitcoin, two coins similar to Bitcoin (Bitcoin Cash and Litecoin), Ethereum, and something very similar to Ethereum (Ethereum Classic). Although there are not many successful and working cryptocurrency projects out there yet, the limited selection on Coinbase could alter a newcomer’s perception about cryptocurrencies in a potentially negative way.
Coinbase adds Index Fund June 12th
Coinbase opened an index fund for investors who wish to invest $250,000 to $20,000,000. The index fund will give exposure to all of the assets on GDAX weighted by their market cap size.
Takeaway: A secure index fund that enables entities to invest $20,000,000 is huge for the cryptocurrency industry. Bitcoin market depth charts are not deep enough to support big orders without making a significant impact on its price. An Index fund should ease big investors into the space and will probably encourage them to hold onto their cryptocurrencies for the long run because of a 2% annual management fee.
Binance Sets Up Bank Account in Malta June 6th
Binance set up a bank account in Malta. Binance’s CEO, CZ, described the new bank account as a “very significant” development. CZ also said that he hopes that fiat-crypto trading on Binance would launch in Malta within the year.
Takeaway: Binance is one of the leading cryptocurrency exchanges. If Binance were to open fiat-crypto trading pairs, the cryptocurrency industry could see much more money enter its space.
Coinrail hack June 11th
Coinrail, a South Korean exchange, got hacked and lost about $40,000,000. Some of the tokens that were apparently stolen were ETH, NPXS, ATX, DENT, NPER, and some others.
Takeaway: Do not store your cryptocurrencies on an exchange or with a third party. The safest way to store your cryptocurrencies is on a hard wallet. It is never a good thing when an exchange gets hacked but Coinrail is a relatively lesser-known exchange and should not stir up the cryptocurrency industry that significantly.
EOS mainnet still not live
It has been over a week since the release of EOS’s mainnet software but the mainnet has still not been launched. EOS coin holders need to vote on the ideal block producer candidates to launch the mainnet but not enough voters have participated to successfully elect a block producer. 15% is the minimum votes required but only about 7% of EOS votes have been registered.
Takeaway: EOS holders may lose confidence in EOS if voting continues to take place slowly but BlockWolf expects the mainnet to launch in the next 1-2 weeks. For more information about voting for EOS block producers visit https://eosauthority.com/voting .