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Is Bitcoin a Currency or a Commodity?

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Bitcoin has quickly asserted itself as an alternative asset deserving of our attention, but if you’re a stickler for details, the real debate is whether it is a currency, commodity or something else entirely. Up until recently, this debate wasn’t given much thought. After all, cryptocurrencies are meant to solve many of the problems plaguing the current system of fiat money. Naturally, then, they are currencies.

Not so fast.

Bitcoin as a Commodity

Investability is one of bitcoin’s most defining characteristics. With a market cap of more than $160 billion, the cryptocurrency allows investors to take capital or gain exposure in meaningful ways. As mainstream adoption catches on, bitcoin investments will also make their way into traditional vehicles, such as ETFs and futures. In this vein, it has many of the same characteristics as commodities.

Bitcoin is often called digital gold because it behaves very much like a commodity. As a divisible resource, it is considered portable, scarce, secure and durable.  The following chart courtesy of BTCS provides a clear illustration of how bitcoin stacks up to the physical commodities gold and silver.

Some investment circles are also beginning to treat bitcoin as a hedge against uncertainty. Although the author believes this is characterization is a tad premature, bitcoin has one characteristic that very few assets have: no correlation. To the author’s knowledge, this feature was first identified by ARK Invest in its highly influential whitepaper Bitcoin: A disruptive Currency.

Whereas most asset classes are correlated, bitcoin’s price is completely independent of outside forces. That means it is not affected by the performance of other markets, regardless of their composition. That means bitcoin behaves independently of stocks, bonds, commodities and even currencies. Investors have already realized and capitalized on these unique benefits, and this is reflected in bitcoin’s price point.

LendEDU Survey

Student and personal loan marketplace LendEDU has been conducting surveys on how consumers perceive cryptocurrencies. This past month, it commissioned a new survey of 564 respondents who have already invested in bitcoin. One of the questions that caught our attention was whether investors classify bitcoin as a commodity or a security.

Less than one-third (31.56%) viewed bitcoin as a commodity, compared with 39.54% who saw it as a security. Interestingly enough, 28.9% of respondents said they were unsure how to classify the cryptocurrency.

It’s interesting to note that “currency” wasn’t listed as one of the responses. While it’s reasonable to assume that many associate bitcoin with digital currency, most investors seem to hold a different opinion.

Further, the LendEDU survey found that 21.81% of respondents described bitcoin as “a long term store of value, like gold or silver.” Meanwhile, a mere 8.16% said they plan on using bitcoin “for transaction or repurchases” instead of as an investment.

The vast majority of poll takers have held bitcoin for more than one year, which means this is likely a rich crowd.

Disclaimer: The author owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.

Featured image courtesy of Shutterstock. 

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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4.6 stars on average, based on 649 rated postsSam Bourgi is Chief Editor to Hacked.com, where he leads content development for one of the world's foremost cryptocurrency resources. Over the past eight years Sam has authored more than 10,000 articles and over 40 whitepapers in the fields of labor market economics, emerging technologies, cryptocurrency and traditional finance. Sam's work has been featured in and cited by some of the world's leading newscasts, including Barron's, CBOE and Forbes. Contact: sam@hacked.com Twitter: @hsbourgi




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Bitcoin Cash Price Analysis: BCH/USD Bulls Have the Potential to Capitalize, Following a Bullish Technical Set Up

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  • BCH/USD broke out and retested a long-running descending trend line, but has failed to capitalize on this further.
  • George Hotz, also known as Geohot, says “Bitcoin Cash is the real Bitcoin.”
  • CoinText.io expands its Bitcoin Cash payment SMS service to Brazil and further European countries. 

“Bitcoin Cash is the Real Bitcoin”

George Hotz, also known as Geohot, an American entrepreneur and hacker, was recently commenting on Bitcoin Cash. Following the BCH Devcon in San Francisco he attended, Geohot demonstrated how to generate a BCH private key from scratch using python coding.

During his python video, George spoke highly of Bitcoin Cash. He said, “I’m using Bitcoin Cash because it’s the real bitcoin.” His reasoning for the preference of BCH over BTC was due to it having significantly lower transaction fees. Stating, “Transaction fees are super low on bitcoin cash.”

Bitcoin Cash Being Used in Brazil with CoinText.io

SMS cryptocurrency payment service, CoinText, has launched their services in Brazil and three other European countries – Poland, Romania and Croatia. CoinText doesn’t require apps, logins or Internet, and users can send Bitcoin Cash via SMS. A new wallet is automatically created when people have received Bitcoin Cash via SMS.

Specifically commenting on the Brazilian expansion, CoinText founder and CTO said, “Brazilians have been suffering from corruption and bad monetary policy,” says CoinText founder and CTO Vin Armani. “Cryptocurrency offers a way for them to peacefully opt out of a corrupt system.”

A move in which is further helping the adoption of Bitcoin Cash, via the CoinText service, he further noted, “Adding Poland, Croatia and Romania brings us closer to connecting the entire continent of Europe,” Armani added. “CoinText’s end-of-year goal is to enable all 740 million European residents to text money to each other’s phones for pennies.”

Technical Review – Daily Chart

BCH/USD daily chart

BCH/USD price action of late has been very much mundane following a promising breakout from a long-running descending trend line. It had been contained below and rejected on several occasions, from the back end of July. Bulls managed to pull off a decent breakout to the upside, which took place between 26-27th September.

After observing the break above, then pullback for a retest of the breached trend line, it looked very promising. This as such played out to the textbook, however bulls failed to capitalize and drive further north. Instead, the price remained within a consolidation nature, a lack of commitment in either direction. Perhaps the bulls are sitting on the launchpad, ready to send this into orbit, time will tell here.

Looking at technical areas of interest, to the upside, resistance has capped upside well into $500 territory. Tracking from $455-80, which has been evident the past few sessions. A firm push higher, will allow $550 region to come back into play. In terms of buyers, they can be found from the current price, all the way down to $400 the round figure.

Disclaimer: The author owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.

Featured image courtesy of Shutterstock.

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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4.5 stars on average, based on 33 rated postsKen has over 8 years exposure to the financial markets. During a large part of his career, he worked as an analyst, covering a variety of asset classes; forex, fixed income, commodities, equities and cryptocurrencies. Ken has gone on to become a regular contributor across several large news and analysis outlets.




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Litecoin Price Analysis: LTC/USD Developers to Slash Transaction Cost, with Upcoming Core Update

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  • Litecoin fees are set to be largely reduced in the forthcoming upgrade, in an attempt to boost adoption.
  • LTC/USD remains heavily dictated by triangular pattern, behavior suggests a breakout is imminent. 

Litecoin Fees to lower by 10x in next Core Release

The Litecoin foundation will be updating the Litecoin protocol to version 0.17, following an announcement via Twitter. This update will ultimately reduce the network’s fees drastically compared to its already nominal costs.

It is reported that with this upcoming upgrade, the network fee will go down to $0.005. Their goal is to encourage greater adoption of Litecoin. Currently, the average transaction fee is floating around $0.05. Bitcoin’s transaction fee is currently seen around $0.10.

At the back end of 2017, a large bull market was observed. Bitcoin prices were up at heights around $20,000. Users as an alternative started to use LTC, given its inexpensive nature, in comparison to Bitcoin. It is interesting to note also that Bitcoin transactions were as much as $55 during those highs. However, Litecoin remained by far competitive, facilitating lower transaction fees, less than $1. During the peak, LTC fees reached $1.5.

Litecoin’s Core lead developer, Adrian Gallagher, was commenting on the upgrade intentions, saying: “To encourage more adoption and usage of Litecoin, I think lowering the fees are a good thing. We’re not even close to block limits and the block size on disk is pretty small (20GB) relative to other coins. Technically people can already adjust their fees right now to the one above, because of the more relaxed min relay/dust relay fee.”

Elsewhere, he was speaking about the current market conditions, believing that the bear market being observed, will not last. Predicting that in the next three to six months, prices could start to rise again. He stated: “With lower fees, it would be possible to lay down the foundation for a fee rate, that can grow proactively rather than re-actively.”

Technical Review – Daily Chart

LTC/USD daily chart

Looking via the daily time frame, LTC/USD price action remains trapped and dictated by a triangular pattern. This is seen across several of the other cryptocurrencies. The calls of an imminent breakout make much sense, with this type of price behavior seen.

Over the past few days, upside has been capped around the $55 mark. Further north, resistance is seen at the $56.50-60, the upper part of the triangular pattern formation. A breakout higher should allow a run well into the $60 territory. Testing the 27th September high ($65.85) would be probable. Supply is seen running from that high up until $70, where the price faltered on 4th September.

In terms of support, $53 has proven to be an area of comfort, over the last five sessions. The lower trend line of the above-mentioned pattern is seen tracking at $51.50. Finally, a demand zone is seen just below running from the big $50 mark, down to $0.47.

Disclaimer: The author owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.

Featured image courtesy of Shutterstock.

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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4.5 stars on average, based on 33 rated postsKen has over 8 years exposure to the financial markets. During a large part of his career, he worked as an analyst, covering a variety of asset classes; forex, fixed income, commodities, equities and cryptocurrencies. Ken has gone on to become a regular contributor across several large news and analysis outlets.




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Cardano Price Analysis: ADA/USDT is Eyeing a Big Move Out of Current Technical Setup

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  • Positive update from IOHK audit of Icarus by Kudelski Security.
  • ADA/USDT is moving within a pennant pattern formation, subject to breakout.

Solid Icarus Audit reported by IOHK

IOHK recently announced in their forum that an audit was conducted by Kudelski Security, which is an independent and third-party security audit firm. The audit conducted demonstrated that the Icarus project implementation for Cardano looks all good and set to go, without any major problems. However, a few changes may need to be executed. IOHK developed the Icarus code as a reference implementation, for Cardano light portfolio.

The important of “independent audits, like this one was stressed by IOHK. Stating “they are critical for identifying security issues in the Icarus wallet, that may not have been identified by internal audits”.

Furthermore, IOHK has elucidated Icarus as an open source code base serving as a reference for the creation of safer and easier mobile wallets for Cardano. They said, “this guarantees our customers and clients the safest portfolio we can offer.”  Given the benefit of an external audit, the developers can resolve any problems identified during its product launch audit.

Positive Updates from Cardano Founder

Cardano’s founder, Charles Hoskinson, was recently commenting on Cardano’s future. He said “We have so many amazing things coming out.”

Mr Hoskinson further added that one of their scientists has flown in from Switzerland. They will be doing a video, which will be the first time they have ever talked about their sharding design that we have for Cardano. Further commenting on other updates, including videos about Shelley and the Rust project.

Technical Review – Daily Chart

ADA/USDT daily chart

ADA/USDT is moving within a triangular pattern or a pennant formation, as seen via the daily time frame. It is narrowing, moving closer to a breakout. Ranging ahead of another drop to the deep south. Although, fundamental developments coming out from the Cardano foundation, remain very much upbeat currently.

Over the past 8 days, the price has been grinding higher, after receiving support at the lower trend line of the above-mentioned pattern. In terms of resistance to the upside, this can be seen at 0.08310000. The upper tracking trend line. Further north, a supply zone is running from 0.09000000-0.09500000. ADA/USDT  last traded here on 23rd September. Finally, support is tracking at 0.071800000, lower part of the pennant, also within a demand area. Another strong buying territory is observed from 0.06500000-0.06000000.

Disclaimer: The author owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.

Featured image courtesy of Shutterstock.

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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4.5 stars on average, based on 33 rated postsKen has over 8 years exposure to the financial markets. During a large part of his career, he worked as an analyst, covering a variety of asset classes; forex, fixed income, commodities, equities and cryptocurrencies. Ken has gone on to become a regular contributor across several large news and analysis outlets.




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