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Op-Ed

Cookbook for a Down Day

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We got ourselves another buying day folks. Unfortunately, when I was asleep there were some pretty good deals going on. I woke up to find some okay prices, but they went back up to those purgatory prices that weren’t eye popping enough. I wanted to share what I do on days like this to stay on top without having to go crazy about it. Alarms and Limit orders. I will also share a coin that interests me on a day like today.

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Alarms

This is a 24/7 market. There are no days off, and the best deals can come at the worst times. For me, they always do. I wake up at 5 a.m. and I am still not ahead on the day. What I do is very simple: go on the Coinbase app and set alerts on all three of the major coins (LTC, ETH, BTC).

The alerts I set are usually in the not-so-crazy downside. For example, my alerts are at $10,999 for BTC, $999 ETH, and $160 LTC. These may not be buying prices, but merely checking prices. At those prices, I want to pick up my phone and check alts. We may have some very big sales going on.

I don’t need to set 50 different alarms, I just need to know what the majors are doing at all times and I will almost be able to predict what an XRP/NEO is doing. If ETH is $999, chances are XRP is near $1.10-$1.20 and NEO is $110-$120 usually. Of course, we are never certain; that’s why we must check.

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Limit Orders

For the layman, a limit order is the process of setting a price at which you would like to buy something instead of buying it in the market at whatever price. So, if you want XRP at $1.00 or below, you set an XRP buy limit order of $1.00. Same goes for selling.

These are probably the best tools that are at your disposal. If you have been investing, you’ve probably found a major asset that you like and have been using as your own virtual coin bee hive. For some it’s BTC, and for others  it is ETH. Having a portion of your base currency always tied up in correction limit orders may be a strategy that you could employ to take advantage of the market’s 24/7 nature.

I wake sometimes and my jaw drops at what coins hit when I was asleep. So, what I did was sell when the market was up the other day into ETH, and have my base currency limit orders. ETH hoarding is my specialty. I have the added benefit of doing so, while also maybe getting a fantastic deal that I can either hodl short/long term (I only buy certain coins that I have mentioned) via limit order.

I take great pride in business picking, and I am confident in it. So, I set prices for when good businesses are tanking for no reason. I knew the market was irrational, but not this irrational. I must take advantage.

The Coin

XRP: Ripple will be added to Coinbase at some point in the near future, along with other cryptocurrencies (XMR, DASH, ZEC are also rumored… I will be doing individual write ups on these soon).

I am an ETH and XRP hoarder. I just have to wait for Coinbase to add XRP, and then pop in the ledger and sell it at an exchange that hasn’t collapsed from the amount of buy orders that XRP will cause when it can be bought in fiat. I have prepared for this day like a cowboy would for a bull ride.

This angry bull is going to jump in the air very quickly, and my performance will be measured in seconds, not minutes. I truly believe in the product, and I will be a long term hodler, but I want my money back. I have a cost basis, and I want to replenish it. I suggest everyone does it on major pumps for any coin.

Coinbase had to shut down BCH at $4,000 to save people from themselves. They were apparently getting reads way above $4,000 and got spooked. This confusion would be an exact entry point into Ripple.

XRP being added to Coinbase is still “somehow” a speculation because the exchange came out and said it had no plans to do so. Coinbase needed to handle the insider trading that took place ahead of the BCH launch, and then they would most likely begin taking strides to rounding out the exchange with more currencies. They have handled the BCH deal already.

The worst case scenario is that they don’t add new currencies in the next few months, and even in that scenario I am okay. Angel List has about 10-20 exchanges that have been going full steam ahead, and are all having dinner parties together each and every day that Coinbase doesn’t add any new coins. These folks will come out with apps, they will come out with perks, and they will come out ways to buy that don’t take nine days like they sometimes do with Coinbase.

This market is going through an exponential expansion (bubble). No denying a bubble. The bubble will burst and the project coins will all fall. Who knows when that will happen. During this bubble, no one is safe. Not even exchanges. They must innovate at a 100 MPH pace to keep up with demand or they will get trampled. Mt. Gox is an example of a trampled exchange. XRP is on every fiat exchange’s wish list. They know their exchanges probably can’t even handle the demand, but they want to open the flood gates. Raiden will be on his surf board when this happens.

Oh, and XRP at $1 is something I want to buy. I make sure I buy it down there. Always. Alerts and Limit orders help me never miss it.

Conclusion 

This market is confusing and scared at all hours of the day. Please make sure that you are investing smartly. There is no reason to pay for something when it is 20% up because you think it will go up another 20%. You missed it. There will be another time to get into the coin, and there is always at least 2-3 coins that are attractive at all times. They will rotate in and out, and you must be prepared for when that happens. I don’t claim to have the best system, but this is best one for me. I check prices a TON, but alerts make sure I don’t miss the right times to check. If you aren’t looking at prices all the time, you shouldn’t be making short term trades. People who don’t look at prices rely wholly on people who are. I don’t invest that way.

 

This is NOT a recommendation to buy or sell cryptocurrencies. The orders I talked about are hypothetical, and XRP is nowhere near the levels mentioned. I want you to think about what you are doing, and what your goals are.

Feel free to chat with me @raijincrypto on Twitter, and I have been sending out some of my thoughts during the day.

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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4.4 stars on average, based on 27 rated postsMythological God of Lightning. Cryptocurrency/Blockchain writer, evangelist, and friend. May the odds be ever in our favor.




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Op-Ed

Is Manipulation Behind Bitcoin Cash’s Absurd Rally?

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Although you wouldn’t know it by today’s prices, bitcoin cash (BCH) has topped the crypto market leader board this month. The digital currency more than doubled over the span of 18 days, and in doing so far outpaced the broader market. But a closer examination of the value drivers suggest manipulation could be partly responsible for the rally.

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As a reminder, the author has no vested interest in smearing BCH as I believe it to be one of the more advantageous coins on the market today. That said, the circumstances surrounding the most recent rally are peculiar to say the least.

What’s Up with Bitcoin.com?

A Hacked user informed me earlier this week that Bitcoin.com has been using the “BCH” ticker next to the word “bitcoin”. Normally, the ticker “BTC” is reserved for bitcoin, which is the original blockchain we all know about. Instead, the website quotes “BTC” next to the term “bitcoin core”.

In other words, BCH is quoted next to bitcoin and BTC is referred to as bitcoin core. See here for yourself:

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For most readers of Hacked, the distinction is easily discernible, but for new traders the difference isn’t easily gauged.

The first question I have is, how many people bought bitcoin (BCH) thinking they were receiving actual bitcoin (BTC)?

Bitcoin.com describes itself as the “premier source for everything bitcoin.” Although the website doesn’t appear to offer a full-fledged trading platform, users can purchase bitcoin and bitcoin cash using the following link.

It is unclear how long the website has been referring to BCH as bitcoin. For those of us who’ve been following the market for some time, the way BTC and BCH are quoted is certainly strange.

Antpool

A large cryptocurrency mining group by the name of Antpool has also been accused of pumping BCH in recent weeks. The pool announced about six days ago that it is responsible for confirming more than 8% of all bitcoin cash transactions. In addition to confirming those, Antpool is also said to be burning BCH on a daily basis in order to reduce supply and boost prices.

Of course, crypto pumps do not require such elaborate setups to achieve their goals. Pump-and-dumps can be orchestrated rather easily through a chat group on social media. But Antpool does have a large and privileged position in the BCH ecosystem, which has raised suspicion over its recent actions.

Bitcoin Cash is Overbought, According to Tom Lee

Fundstrat’s Tom Lee recently weighed in on the bitcoin cash phenomenon, concluding that the cryptocurrency was overbought. In his view, investors should stick with bitcoin if they had a choice between Core and Cash.

In a segment on CNBC’s Fast Money, Lee said:

“I prefer not to pick winners and losers when we’re looking at cryptocurrencies like bitcoin/bitcoin Cash… Both have merits but if I was putting new money to work today… I would be a lot more interested in buying a lagger that could attract inflows rather than something that’s potentially overbought.”

Bitcoin cash added around $1,000 to its value between Apr. 6 and 23, with prices peaking near $1,600. The cryptocurrency corrected sharply lower on Wednesday and was still declining as of Thursday’s early-morning session. At the time of writing, BCH/USD was down 4.6% at $1,268.

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 403 rated postsSam Bourgi is Chief Editor to Hacked.com, where he specializes in cryptocurrency, economics and the broader financial markets. Sam has nearly eight years of progressive experience as an analyst, writer and financial market commentator where he has contributed to the world's foremost newscasts.




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Decentralization

JP Morgan’s Surprise Cryptocurrency Fees are a Reminder of Why Decentralization Is Sorely Needed

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JP Morgan Chase & Co has been hit with a class-action lawsuit by cryptocurrency traders over allegations of unannounced fees and higher interest rates on purchases of digital currencies. Though the allegations have not been proven, extra fees are a tactic routinely employed by traditional banking institutions. In the case of JP Morgan, this has karma written all over it given the way its chief executive has ridiculed digital assets by associating them with fraud.

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Class Action Lawsuit

Traders from across the United States are seeking statutory damages of $1 million for unannounced interest charges and fees on cryptocurrency transactions between January and February of this year. The named plaintiff in the lawsuit is Brady Tucker, an Idaho resident who paid a total of $163.91 in fees and surprise interest charges over a six-day stretch.

According to information obtained by Reuters, the lawsuit accuses the bank of violating the U.S. Truth in Lending Act, a piece of legislation that requires credit card issuers to inform customers in writing of any notable change in fees.

The lawsuit asserts that Tucker tried to resolve the dispute by calling Chase’s customer support service directly. His request was turned down, prompting him to seek legal help. According to Bloomberg, the case in question is Tucker v. Chase Bank USA NA, 18-cv-3155, U.S. District Court, Southern District of New York (Manhattan).

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The Growing Case for Decentralization

Depending on who you ask, the allegations against JP Morgan are akin to cryptocurrency fraud not unlike the kind Jamie Dimon talked about while ridiculing bitcoin. But the irony in Dimon’s comments extend far beyond Chase’s latest dealings.

As the actions of Chase bank and other financial institutions have clearly demonstrated over the years, those who control the size and growth rate of fiat money cannot be trusted to do the right thing. As Nassim Taleb argues in The Black Swan, banks have a tendency of losing as much money as they make in the long run due to shady business practices and high-risk ventures. Decisions like these are easy when you are Too Big to Fail.

Decentralization, like the kind advocated by blockchain startups and cryptocurrencies, allows users to trade directly with each other without having to go through a (predatory) middleman. Decentralized systems not only help participants avoid unnecessary fees, red tape and other forms of unwanted intervention, they are virtually impossible to shut down. In this vein, decentralized currencies give people a fighting chance in their battle against never-ending inflation. As we’ve argued before, this is not only a prudent fight, but a noble one as well.

Cryptocurrencies that rely on decentralization offer society a unique value proposition unlike anything we’ve seen in recent history. What’s more, their adoption is not contingent upon us leaving the realm of traditional finance – at least, not yet. That’s because cryptocurrency started off as an obscure and esoteric asset class but has since become a value store for investors. Tomorrow, it will become a viable medium of exchange accepted worldwide.

That said, we are still in the very early days of the crypto revolution and it may be a while still before we can conclusively prove people like Dimon wrong. But crypto backers and investors should take comfort in knowing that big banks rarely lead in disruption these days. They have the resources to play catch-up, which they are clearly doing with blockchain.

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 403 rated postsSam Bourgi is Chief Editor to Hacked.com, where he specializes in cryptocurrency, economics and the broader financial markets. Sam has nearly eight years of progressive experience as an analyst, writer and financial market commentator where he has contributed to the world's foremost newscasts.




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Altcoins

Will Dash Be the Bitcoin Killer?

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Well, it has finally happened.  We’ve gone a full week with crypto prices showing positive returns.  OMG, what a big surprise; ether is leading the pack, advancing nearly 15% at the time of this writing.  This is encouraging because it shows that perhaps finally value investors are stepping in and helping set a pricing bottom.  

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It hasn’t hurt a bit that stock and bond market investors have become seasick from all the volatility.  Suddenly, a tiny little weekly Litecoin move of +0.46% or even a 2.47% bitcoin cash gain, looks like pure serenity.  

 

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For a while now our focus has been on relative value and there is very little argument that, after the first quarter price collapse, a whole lot of risk has been taken out of bitcoin, ether, Ripple and thousands of others.

The question is where to go and what to go with from here.  The big crypto names are the safe way to go in the short run, but each has become mired in network limitations on scaling and the concomitant cost issues.  

Yes, transaction fees have dropped like a stone from their prohibitively high levels of December but then transaction volumes have fallen by half and more.  That is not the stuff an investor wants to see.

Both bitcoin and Ethereum hope to solve scaling issues with the Lightning Network and Raiden. But for now, if transaction volume were to suddenly rise, the same network limitations would be there.  So even though the big crypto names offer the safest short term options, does that mean we shouldn’t look further out to find value?

Will Dash Solve Bitcoin’s Problem?

Dash emerged last year as one of the most popular and most valuable altcoins. At the time it was considered a real competitor to bitcoin and the leading cryptocurrency of the future. The price of Dash increased from $11 to over $1,430. Dash had a capitalization of over $11 billion at its December peak. Since then it has tumbled more than 80%.  Is now the time to move into Dash? The timing could be very good but before making that decision, we should consider a few things.

Judgement Time

If a jury of its peers were to grade Dash on its performance in 2017, the majority would say it lived up to its billing.  Using Dash, users could send money instantly using the InstaSend feature that allowed for complete anonymity. At the peak, transaction costs were around $0.60, which were dwarfed by bitcoin’s high of $30. 

Since then, Dash fees have fallen to about $0.20, making them attractive for small sized transactions. All alone this represents a compelling feature of Dash.  Add to that the immediacy of InstaSend and you have the makings of a genuine challenge to Bitcoin.

Caveat Emptor

In appraising Dash’s performance it is useful to look at Metcalfe’s Law, which values social media assets based on a formula of network size.  For Dash, it’s network is processing a tiny fraction of bitcoin’s. The limitations of its network have very likely not yet been tested, so proclaiming Dash the speed king is a bit early. There is still a larger issue to consider.

In the case of Metcalfe’s Law we need to include merchants and other service providers that accept Dash as payment.  That is the big hump for them to overcome before overturning bitcoin. So far, after all, bitcoin is accepted by only about 10,000 or so merchants.  

Further progress by bitcoin is stymied by transaction costs that remain far too high.  Even so look at how many years it has taken bitcoin to attract merchants. Dash faces the same hurdles.

In other words, the trick for Dash is the find a way to gain mass acceptance quickly. That is when the huge $11 billion valuation of last December will begin to be justified. Look over your shoulder bitcoin – faster, lower cost competition is looking to eat your lunch. Dash could be one of those.

 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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4.4 stars on average, based on 75 rated postsJames Waggoner is a veteran Wall Street analyst and hedge fund manager who has spent the past few years researching the fintech possibilities of cryptocurrencies. He has a special passion for writing about the future of crypto.




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Hacked.com and its team members have pledged to reject any form of advertisement or sponsorships from 3rd parties. We will always be neutral and we strive towards a fully unbiased view on all topics. Whenever an author has a conflicting interest, that should be clearly stated in the post itself with a disclaimer. If you suspect that one of our team members are biased, please notify me immediately at jonas.borchgrevink(at)hacked.com.

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