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Crypto Market Cap Rebounds 45% From Flash Crash as Chinese Investors Receive ICO Refund

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With Chinese ICO investors paid off and coin values rising, the cryptocurrency market appears to be back on track. But nobody knows why or who’s driving the gains.

Crypto Market Cap Jumps

The total value of all cryptocurrencies in circulation has risen steadily in recent weeks. The crypto market cap rose as high as $147.1 billion on Thursday as 24-hour trade volumeclimbed back above $4 billion. At press time, the total market capitalization was slightly below $144 billion.

Cryptocurrency flows plunged in the first two weeks of the month, with the market briefly falling below $100 billion on Sept. 15. The 45% rebound over the last two weeks appears to have been driven by a combination of technical trading and bargain hunting.

Bitcoin, which has been at the center of China’s regulatory crackdown, climbed back above $4,000 this week. The BTC crypto coin is trading at $4,100 at the time of writing, according to Bitstamp.

The ether token briefly traded above $300 before a technical reversal dragged prices back toward $290.00.

Bitcoin and Ethereum are the world’s No. 1 and 2 crypto coins based on total market cap. It’s also worth mentioning there are nine other cryptos with a value of $1 billion or more. Half a dozen others have a value between $470 million and $944 million, according to CoinMarketCap.

China’s ICO Refund

Chinese investors are flush with cash after nearly a billion dollars in ICO investments were returned to them. You’ve no doubt heard by now that the People’s Republic launched an all-out assault on cryptocurrency this month, beginning with everyone’s favorite crowdfunding model. As a result, the 40-plus ICOs that were launched on the mainland this year have been de-funded.

But the Chinese aren’t going away that easy. During the recent Wanxiang blockchain conference, rumors circulated that the the founders of ICO-backed companies were planning to re-register in Hong Kong or Singapore. This means it’s probably only a matter of time before mainland investors put their money back in.

Hacked.com reported last week that bitcoin traders are moving from China to Japan to work around the ban. Unlike China, Japan has formally recognized bitcoin as a form of payment and has moved swiftly to regulate its use. Hundreds of thousands of Japanese retail outlets start accepting the payment this year, analysts say. South Korea also appears to be moving in the same direction.

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 462 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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Stellar Lumens Update: Acquisitions and Retirement Accounts

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Stellar Lumens is in the headlines this week amid reports that it is negotiating to acquire a high-profile startup by the name of Chain. Meanwhile, a bitcoin IRA that lets users buy cryptocurrency for retirement added XLM to its list of available assets, potentially raising the investment appeal of the Stellar protocol.

Stellar Eyes Chain Acquisition

Fortune reported Wednesday that Stellar has been in talks to buy the San Francisco-based blockchain startup for $500 million. Citing anonymous sources, the report said the payment would be made in XLM, the seventh-largest cryptocurrency by market capitalization. No cash or equity will be part of the sale, which has yet to be finalized.

Although Stellar’s plan for Chain is not yet known, its interest in the startup is tied to its team of talented blockchain developers. Stellar founder and crypto trailblazer Jed McCaleb has a keen eye for talent, having founded Mt. Gox, eDonkey and Ripple XRP.

Chain develops enterprise-grade blockchain solutions, including ledger products that allow businesses to transfer funds in token format. The company raised over $43 million in venture funding from high-profile investors including Visa, Nasdaq, Citi Ventures and Blockchain Capital.

It is not entirely clear how the purchase would impact XLM’s market value. For current investors, the main concern is a wholesale dump of Lumens by Chain’s backers in the event that the sale actually takes place.

At a current price-per-coin of less than $0.23, the Chain acquisition would translate to roughly 219.3 million XLM. There are roughly 18.7 billion Lumens in circulation, giving the currency a total market cap of $4.3 billion.

Stellar for Retirement

The BitcoinIRA retirement platform has announced the addition of both Stellar Lumens and Zcash to its available list of cryptocurrencies, giving investors the ability to diversify their crypto holdings for retirement.

“[W]e’re excited to meet the high demand for both Stellar Lumens and Zcash in the marketplace by making these coins available to customers looking to diversify their retirement portfolios,” said Chris Kline, BitcoinIRA’s Chief Operating Officer.

In addition to Lumens and Zcash, the BitcoinIRA platform allows retirement planners to access bitcoin, Ethereum, Ripple, Litecoin, bitcoin cash and Ethereum Classic.

Crypto IRAs fall under a much broader category of assets called digital IRAs, which are self-directed retirement accounts. Cryptocurrencies are recognized by the IRS as property, which allows for their inclusion in retirement accounts. Self-directed IRAs have unique tax benefits that can help investors maximize their digital currency holdings.

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 462 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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Analysis

Crypto Update: Coins Drift Sideways as Trading Activity Plunges

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Liquidity dried up in the cryptocurrency segment in recent days, as trading volumes have been declining progressively, while the major coins got stuck in tight ranges. Only a few coins show signs of activity, and the bearish short-term patterns continue to dominate the market. With a group of currencies, namely Litecoin, Monero, Dash, and Bitcoin itself clearly dragging the segment down, the short-term trend will likely continue, as the previous leaders are now showing strength either.

While all of the top digital currencies are showing some gains today, and the total value of the market edged close to $290 billion, major resistance levels are still towering above. The fact that the effect of the Bithumb hack faded away quickly is a positive here, but until signs of bullish momentum and a clear leadership forming, the short-term outlook remains bearish.

BTC/USD, 4-Hour Chart Analysis

Bitcoin continues to trade near the $6750 level, edging ever closer to the declining short-term trendline, in a bearish consolidation pattern. Bulls would need a sustained move above $7000 to negate the declining trend, but for now at least a test of last week’s lows is likely with a possible move towards the key long-term zone between $5850 and $6000.  The short-term zone around $6350 level provides support, while further resistance is ahead near $7350.

Ethereum Nears Trendline as ETC Attempts Breakout

ETH/USD, 4-Hour Chart Analysis

Ethereum has been among the strongest coins in the last few days again, and coupled with its long-term relative strength, the second largest coin is still the best candidate to lead a recovery. That said, the coin still faces strong resistance between $555 and $575, and bullish momentum is suspiciously weak. Primary support is found at $500 with further zones near $450 and $400.

ETC/USD, 4-Hour Chart Analysis

Ethereum Classic has been positively diverging compared to the rest of the market, together with Binance Coin, and to a lesser extent Tron ever since its inclusion to Coinbase, and the coin moved above the key $16 resistance yesterday in late trading.

While ETC is slightly overbought from a short-term perspective, a consolidation above $16 and a subsequent move higher could confirm a trend change. For now, the short-term trend signal is only neutral, and traders should remain cautious given the broad downtrend in the segment

Featured image from Shutterstock

Disclaimer:  The analyst owns cryptocurrencies. He holds investment positions in the coins, but doesn’t engage in short-term or day-trading, nor does he hold short positions on any of the coins.

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 279 rated postsTrader and financial analyst, with 10 years of experience in the field. An expert in technical analysis and risk management, but also an avid practitioner of value investment and passive strategies, with a passion towards anything that is connected to the market.




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Three Reasons XRP Is Not a Security: Ripple’s Garlinghouse

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Ripple CEO Brad Garlinghouse was a featured panelist at the CB Insights Future of Fintech conference in New York today. Chief among the themes in the discussion was XRP, the No. 3 cryptocurrency based on market capitalization in which Ripple owns the majority of tokens.

While the No. 1 and No. 2 digital currencies, bitcoin and Ethereum, respectively, were cleared from being regulated as securities, Wall Street regulators have yet to make a call on XRP.

“I think it’s really clear XRP is not a security,” Garlinghouse said in the session.

There is a misconception in the cryptocurrency community that Ripple controls XRP. In fact, XRP is a decentralized digital currency that Ripple uses in its cross-border payments product xRapid. They could just as easily use bitcoin except “ bitcoin transactions on average are 45 minutes in and 45 minutes out. So XRP is uniquely positioned to solve the cross-border liquidity problem,” Garlinghouse said. 

He went on to outline a trio of reasons why XRP should never be identified as a security.

  1. “If Ripple as a company shut down tomorrow, the XRP ledger would continue to operate.”  
  2. “If you buy XRP, you’re not buying shares of Ripple.” As a holder of XRP, you’re not entitled to dividends or equity. Even though Ripple owns more than half of XRP, it doesn’t give them control of the currency, he said, comparing it to the dynamic between Saudi Arabia and oil. “Saudi Arabia owns a lot of oil, but they do not have control of oil.” 
  3. Utility. “XRP is solving a problem. There’s no security in a utility,” he said, adding that he “looks forward to the SEC clarifying some things.

Crypto Exchanges

Garlinghouse was diplomatic about cryptocurrency exchanges like Coinbase that have yet to add XRP to their trading platforms. In recent weeks, Coinbase announced that it would begin supporting Ethereum Classic (ETC), while many in the cryptocurrency community have been wondering when the U.S.-based exchange will add support for XRP.

“XRP is listed on 75 exchanges around the world. It has expanding liquidity … The consumer speculator is not our target market. Our target market is financial institutions that we can solve big problems for,” Garlinghouse noted.

Crypto Rivalry?

Yesterday Ethereum Co-Founder and ConsenSys Founder Joseph Lubin, who was included among the panelists, took a swipe at rival coin XRP, suggesting it is “massively overvalued.” The same question was posed to Garlinghouse during his session about Lubin’s ConsenSys. Garlinghouse took the high road, saying he was “excited” about them, adding they’re “underrated.”

XRP is the third largest cryptocurrency, boasting a market cap of $21 billion compared to more than $53 billion for Ethereum and $115 billion for bitcoin. Garlinghouse’s outlook is that at least one bank will be using it 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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4.5 stars on average, based on 16 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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