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Bitcoin-Fueled Square Cash App Outpaces Rival

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Square’s mobile payments app, which famously began supporting bitcoin at year-end 2017, is experiencing accelerated growth compared with a key rival. Square Cash has leapfrogged PayPal’s Venmo digital wallet for the number of downloads over the past couple of years, according to analysis from Nomura Instinet cited in CNBC. In fact, given its support for bitcoin trading via a mobile phone, Square Cash may be more aptly compared with cryptocurrency exchange like Robinhood or Coinbase than traditional payments app Venmo.

Square vs. Venmo

Both Square and Venmo apps are used for payments, and consumers are downloading Square Cash at a more feverish pace versus Venmo, as evidenced by monthly growth measured on a year-over-year basis of 128%, on average, for the bitcoin-supported app compared to 75% over the same period for PayPal’s app.

Square Cash has been downloaded a total of 28 million times, which trails PayPal’s Venmo by 1 million. But Square is closing in on its rival. Nomura’s Dan Dolev explained: “Historically, Venmo saw more downloads versus Square, but the gap appears to have peaked in July 2017.”

Square generated more than $34 million in BTC sales in Q1, but it only saw $200,000 of that because of the $33.9 million it originally shelled out to fund the bitcoin account.

Dorsey vs. Schulman

Jack Dorsey and Dan Schulman, the CEOs of Square and PayPal, respectively, take a different tack when it comes to bitcoin. Dorsey has embraced the leading digital currency, as evidenced not only by Square Cash’s support for bitcoin but also for his participation in the cryptocurrency market.

Dorsey is among a group of backers of Lighting Labs, which developed a network to speed up bitcoin transactions and make them less pricey so they’re more conducive to payments. Dorsey was part of a $2.5 million seed financing round.  Meanwhile, amid the competitive market for currencies of late, the Square chief expects a single currency to dominate in the next decade, and he believes it will be, you guessed it, bitcoin.

PayPal’s Schulman, on the other hand, while not entirely dismissive of bitcoin, is less enthusiastic and seems to be missing an opportunity by not positioning the No. 1 digital currency out front the way that Square has.

For instance, Schulman said on the company’s Q1 earnings conference call:

“[We’ve] experimented with Coinbase and others in terms of direct connection to cryptocurrencies. Right now, we do not support directly cryptocurrencies. We don’t see the demand for it from our merchants or our consumers, but that should not be any indication that we don’t see, nor are we excited about the potential of blockchain in the long run.”

Perhaps after Nomura’s findings, PayPal will reconsider their position. PayPal shares are up about 5% year-to-date compared to Square, which has jumped more than 52%.

Fed’s Growing Criticism

Meanwhile, despite the advancements for payments and bitcoin as a payment method, Federal Reserve officials remain as cautious as ever. Fed Governor Lael Brainard speaking at a conference in San Francisco this week reportedly cited “significant challenges” for cryptocurrencies in the “retail financial system.” In Brainard’s findings, digital currencies aren’t ready for the mainstream, but based on the shift toward Square Cash fueled by bitcoin, she may be missing the forest for the trees.

Feature 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 69 rated postsGerelyn has been covering ICOs and the cryptocurrency market since mid-2017. She's also reported on fintech more broadly in addition to asset management, having previously specialized in institutional investing. She owns some BTC and ETH.




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Zcash Price Analysis: What is Behind the Recent Surge in Price?

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  • Zcash had jumped over 17% over the period of 12-18th October, before running into sellers.
  • The foundation set to launch the Sapling protocol upgrade. To improve efficiency for shielded transactions.

Zcash over a 6-day period from 12-18th October gained a whopping 17%. Moving quickly from as low as $108, to then be above $126. Since, the price has run into some sellers and touted profit-takinggiven the large run in such as short time frame.

What Is This ‘Zcash’ (ZEC)?

Zcash was a hard fork of Bitcoin in 2016. Unlike the number one ranked crypto by market cap, privacy is ensured via Zcash. Personal and transaction data are kept confidential. This being facilitated through zero-knowledge proofs, allowing conducted transactions to go through verification without any required details about the sender, receiver as well as the transacted amount.

Zcash Set to Launch Sapling Protocol Upgrade

The Zcash foundation recently updated via their blog ‘Sapling Transaction Anatomy’. Full breakdown details can be read there as they are set to launch the Sapling protocol upgrade.

Sapling, this will be a network upgrade that aims to substantially improve efficiency for shielded transactions – paving the way for broad mobile, exchange as well as vendor adoption of Zcash shielded addresses. Their motivations for the Sapling upgrade are to increase speed on these shielded transactions.

Coinbase Speculation Continues to Do Rounds

The community around Zcash continues to speculate on whether the privacy-focused crypto will be added to Coinbase. Earlier in the year, Coinbase said they were exploring the possibility of listing Zcash and others, such as Cardano, Basic Attention Token, Stellar Lumens and 0x on its platforms. This covered back in July and does not guarantee it will be added, but the hope still appears to be flowing through the community.

Zcash Jumps to 20th Largest by Market Cap

Earlier this week, Zcash managed to break into the top 20 cryptocurrencies by market cap. It overtook Dogecoin. The current market cap at time of writing seen at $588,429,693, ahead of DOGE at $513,884,230.

Technical Review – Daily Chart

ZEC/USD daily chart

ZEC/USD has been cooling over the past two sessions, after its recent 17% price run. It isn’t too much of a surprise to see the current easing, given the fast surge higher. Near-term support can be found around $115 area, then further south within a demand zone tracking from $110-105. Looking to the upside, sellers are camped heading into the $130 territory. A higher near-term target would be eyed at $145, price last traded here on 28th September.

This year Zcash is still down some 80% from the highs in January, up over the $800 price level. It has failed to sustain any upside momentum, rallies continue to be sold by the bears. This is something that has been seen across the other cryptocurrecies, not just Zcash. The market continues to search for a bottom.

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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Pantera Capital’s CIO Predicts 10x Growth in Next “Huge” Crypto Bull Run

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Bull pattern

Joey Krug, who is the co-chief investment officer at Pantera Capital, believes cryptocurrency prices have bottomed or at least come close to it, but that doesn’t mean institutional capital will flood the market right away. Pantera Capital, which is a crypto investment fund that oversees approximately $700 million in AUM, participated in Bloomberg’s recent crypto conference in which Krug gave the temperature of the market.

While the bitcoin price may have bottomed, it has been stuck in a trading range, something that Krug doesn’t expect will change until a couple of catalysts take hold. The market drivers will be two-pronged, including the scalability of decentralized apps and the high cost of converting fiat into cryptocurrencies, the latter of which Krug expects is “going to change a lot over the next six to nine months.”

Pantera has been backing blockchain startups that are designed to solve the scalability issue. For instance, while the Bitcoin network can handle seven transactions per second (TPS) compared to “tens of thousands” TPS for Visa and Mastercard, Krug isn’t convinced that Bitcoin will ever reach a similar capacity. “But I do think we will see blockchains as fast as Visa or Mastercard in the next couple of years,” he added.

Incidentally, Spencer Bogart, who is a partner at Blockchain Capital, a crypto and blockchain investment firm that is similarly based in San Francisco, seems to be focused on a similar theme, saying today –

Meanwhile, Pantera’s Krug pointed out that to convert fiat to crypto on U.S.-based crypto exchange Coinbase, the cost is 150-400 basis points via a debit card or ACH bank transfer. “I think within the next year, that will be down to 50 basis points,” said Krug, adding: “Maybe not Coinbase, maybe some upstart.” For instance, the proliferation of crypto trading institutions like Bakkt and Fidelity should drive costs lower.

Market Rally

Fidelity’s move into crypto custody, meanwhile, didn’t make a splash in terms of prices because these days the market is more interested in “actual adoption,” a phenomenon that first requires scalability. While real scalability may remain a couple of years away, that doesn’t mean investors need to wait that long for the next Bitcoin rally. “We could see a rebound before then, but I think that’s going to be the real catalyst that drives the huge next bull run in my opinion,” said Krug, adding: “The crypto space overall [could grow] a good 10x from here.”

Pantera’s bitcoin fund has been performing similarly to the BTC price, while the broader digital asset fund is down more severely as investors flee altcoins and flock to bitcoin as a safe haven. Meanwhile, Pantera Capital is in the process of raising a $175 million crypto fund, the first close for which occurred over the summer and the next close for which is expected by year-end.

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 69 rated postsGerelyn has been covering ICOs and the cryptocurrency market since mid-2017. She's also reported on fintech more broadly in addition to asset management, having previously specialized in institutional investing. She owns some BTC and ETH.




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Nouriel ‘Dr. Doom’ Roubini Argues Against Crypto at Senate Hearing

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Economist Nouriel Roubini is kicking cryptocurrencies while they are down. In his testimony today before the Senate Banking Committee today at a crypto and blockchain hearing, Roubini argued that cryptocurrencies are “the mother of all scams and (now busted) bubbles.”

The timing of today’s hearing before skeptical U.S. Senators couldn’t have been worse, with the broader cyrpto market having shaved billions of dollars from its value overnight.  Roubini took advantage of the current sell-off, using it to his advantage and pointing to double-digit declines in leading coins like “ETH, XRP and other key cryptocurrencies.” The ETH price is currently barely holding above $200, while XRP is down by 13%, with the total value of the market hovering at $201 billion.

Chief among Roubini’s argument is that cryptocurrencies aren’t scalable and that there is “massive centralization” in an “oligopoly” that’s extremely risky. In fact, in recent days, he accused Ethereum Co-Founders Vitalik Buterin and Joseph Lubin of being “criminals” for their ETH holdings and wealth. Buterin fired back, hitting Roubini — who earned the nickname Dr. Doom for predicting the housing crisis of 2008 — where it hurts.

Skeptical Senators

Senators peppered Roubini and Peter Van Valkenburgh, who is the director of research at Coin Center, a nonprofit dedicated to protecting the open blockchain networks, with questions about bitcoin. They were seemingly looking for a way to distinguish between opportunities for technological innovation, e.g. crypto derivatives, and challenges surrounding regulation and scams.

U.S. Senators are open-minded about hearing about use cases for crypto and blockchain technology that can help the unbanked but appear skeptical about profit potential in light of this year’s 70% downturn in the BTC price and the ability to stamp out scams.

Meanwhile, Roubini may be an expert on the economy, but he knows enough about cryptocurrencies and the community that he refers to as “crypto land” to be dangerous. The blockchain, he stated is “nothing more than a glorified database.” He complained about the blockchain only being able to handle five transactions per second, adding that 80% of mining is controlled by an oligopoly.

But in defense of the crypto market, Van Valkenburgh frequently gave Mr. Roubini a wake up call on topics like TPS in which he rebutted:

“We can do a lot more. There are multiple layers being built on top of Bitcoin today that do [robot-powered] batch settlement” in which thousands of transactions can be completed.

As for Roubini’s argument about centralization, Van Valkenburgh quipped that miners with power “can’t do much.” For instance, the number of bitcoins in circulation is fixed, so they can’t change that. Also, they “can’t reallocate or move other people’s funds on the blockchain.” The worst they can do, he stated, is to “slow down the network” via a denial-of-service attack, which is the internet is similarly vulnerable to.

Market Volatility

The instability in cryptocurrency market prices this year was the elephant in the room. But as investors in any emerging asset class could attest to, there can be a “struggle to price something new,” said Van Valkenburgh, pointing to “irrational exuberance” that had, in fact, gripped the market. But institutional capital beginning to come off the sidelines, into bitcoin first and eventually other digital currencies, which is a sign of a maturing market. “We could use ETFs regulated by the SEC. We could use better [custodial solution] in general,” he added.

U.S. Senators questioned Roubini and Van Valkenburgh about the risks for Main Street investors. One Senator described that while the Winklevoss twins may be able to shoulder the risk, families risking their savings may not.

The profile of the average cryptocurrency investor, however, is someone who is “technologically sophisticated” as they must know how to manage public and private keys, Van Valkenburgh explained. The market is attractive to millennials, which reflects the ideal time to take investment risk in someone’s life.

Meanwhile, crypto exchanges have adopted “know-your-customer” standards for consumer protection. One shortfall is these companies must gain a money transmission license on a state-by-state basis, which is a cumbersome process. As a result, a federal license that encompasses a solution for market manipulation “would be a wise choice to make America a leader and protect our consumers,” Van Valkenburgh said.

While the Senate hearing on crypto may have taken place on a tough market day, the price declines are rivaled by the fact that bitcoin, while imperfect, is working.

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 69 rated postsGerelyn has been covering ICOs and the cryptocurrency market since mid-2017. She's also reported on fintech more broadly in addition to asset management, having previously specialized in institutional investing. She owns some BTC and ETH.




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