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Extensive and Unenforceable SEC Regulations Should Be Challenged

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For those who don’t know or aren’t located in the USA: the U.S. Securities and Exchange Commission (or ‘SEC’) is an independent federal agency which was founded in 1934, by then-President Franklin D. Roosevelt.

Conceptually, it is an impartial entity for the enforcement and implementation of federal legislature and regulations pertaining to securities and tradable assets; as well as national stock and options exchanges.

The SEC have recently been in the crypto-financial headlines because of their decision to define cryptocurrencies as securities. As a result of this, all relevant laws that pertain to securities are now applicable to cryptocurrencies as well, and this is a statement that the SEC have been all too keen to broadcast.

As such, the company have opened investigations and delivered subpoenas to 80 cryptocurrency companies.

These actions have far reaching implications for the crypto industry both in the USA and abroad, as the decisions made by American lawmakers often have a rippling effect on other Western nations.

The Speculative Feedback Loop

For investors and active traders, the decisions made by the SEC have had a negative impact on the overall value trends across the crypto-markets.

Predictably, the trend has propagated by opportunistic publications (whose revenues are driven by sponsorships and advertising) – which creates a feedback loop of negative speculation / reaction, and the spread of FUD.

It appears that the highly publicized legal actions taken by the SEC as mentioned above are (in this writer’s opinion, at least) meant to make examples of the parties involved, whilst sending a message to companies within the industry that they are not willing to compromise on enforcing their legislative decisions.

Whether the government can universally enforce these rules across an industry which is largely built upon the ideological and technical principles of decentralization, however, is highly questionable.

A Law for the Abiding

I believe that there are a few potential outcomes of such mis-informed law-making, which are likely to take place because of the SEC’s mis-informed decision-making.

  • They will create the laws / rules first and create an enforcement strategy second – indicating a fatal lack of insight into the very-real complexities of the ever changing crypto-sphere.
  • Due to their lack of technological expertise, they will likely contract an external organization or form a new government department to complete investigations & enforcement at the taxpayers’ expense.
  • Because of the difficulty of enforcing these rules (which they are seemingly unaware of) the lawmakers may opt for extreme penalties as a deterrent to those who risk disobeying.

Whether the government can enforce their regulations effectively on cryptos or not; what is likely is that the rules won’t be governed absolutely (it’s almost impossible to achieve 100% enforcement of crime).

As a result, legitimate businesses are likely to suffer because of this ignorance whilst the real bad actors are unaffected and apathetic to the new implementations.

Bear in the China Shop

The situation in China, for example, is indicative of another potential unforeseen result of increasing regulations. The country recently and infamously imposed a comprehensive ban, blocking all cryptocurrency trading and ICO websites from inside the country and abroad.

Serious entrepreneurs and business-owners with a thorough dedication towards their craft have subsequently migrated to independent coastal municipalities, such as the special administrative region of Hong Kong, to overcome these obstacles. Presumably if the ban were to somehow be introduced into such cities also, then the cryptocurrency organizations in China (or at least, the legitimate ones) would go one step further and move to another country with less restrictive laws on cryptos.

This would be a slap in the face to the government themselves in the long-term, as they would be missing out on the financial incentives offered by effective, fair taxation & regulation of the sector; rather than outright blacklisting.

Similarly, other federal departments in the USA have made their own mistakes regarding cryptocurrency. Citizens and organizations are required to pay tax on all cryptocurrency earnings and transactions, as they would with any other currency. The government have again subjected a misunderstood market to the regulations expected of a highly controlled, centralized form of tender (fiat) – and there have not been any reported instances of conviction in this regard due to the difficulty of identifying of decentralized data as an unauthorized third party.

I have nothing against regulation, considering the potential of cryptocurrency to be a volatile ‘wild west’ of finance; but it needs to be approached in a completely different way.

Manipulators of Ignorance

A quick diagnosis of the problem leads to the conclusion that the key malefactors contributing to these controversial laws being implemented are political influencers who possess a disproportionate level of technical knowledge in comparison to their peers.

Look at FCC Chairman Ajit Pai, for example. Despite your opinion on the net neutrality bill, its repeal was heavily influenced by the man’s disproportionate industrial expertise on the subject; which was accumulated through a career of working for the very organizations who stand to benefit most from the decision.

Furthermore, the controversial repeal was influenced heavily by corporate lobbying groups. It should be considered that finance-based legislature is similarly likely to be influenced by powerful influencers whose vested interests lie in centralized industry.

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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Altcoins

Cardano Price Analysis: ADA Must Hold This Key Support or Be Forced to Give Up $0.04 & $0.03

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  • ADA/USDT price action has formed a head and shoulders pattern, subject to a possible neckline break.
  • Chunky supply is heavily capping upside for ADA/BTC, tracking from 0.00001400-0.00001200.

ADA/USDT in the very latter stages of trading on Sunday was seen nursing chunky losses of over 5%. The price has continued to trade within a choppy nature, a failure to see commitment from either bear or bull camp for ten sessions now. Market participants have been treading extremely cautiously since the steep fall on 10th January. ADA/USDT had plummeted a whopping 22% within the mentioned session. It was the biggest drop in a single session observed since 16th January 2018, where the price tanked around 44%.

Head and Shoulders Formation

ADA/USDT daily chart.

Looking via the daily chart view, price action has been constructing a head and shoulders pattern formation. The left shoulder and head are seen with the right shoulder close to completion. Currently the price on the latest candlestick heading south is edging closer to the neckline, which will determine whether the textbook pattern will materialize. In terms of the vital support (neckline), this is tracking at $0.047000. Should the bears sustain the downside momentum observed in this session, then a breakout could be seen in the next day or two.

Key Support Areas

A breach of the above-detailed neckline will likely open another wave of hard selling pressure. On this potential note, key areas of comfort should be known at $0.039000 (daily support), $0.035500 (27-28th December 2018 low area). Going by the distance between the head and neckline of the pattern, a drop down to the December 2018 lows may be seen. As a result, this would see a retest of the low area from 7th-15th December, $0.027600. Strong buyers came into play here in mid-December to send ADA/USDT back into a decent upside trend.

ADA/BTC Technical Review

ADA/BTC daily chart.

Upside is capped as the price trades within a very stubborn area of supply. There is a chunky amount of resistance that tracks from 0.00001400 down to 0.00001200. The price has not traded comfortably above this region since the start of September 2018. Furthermore, given the continued rejection and lack of upside momentum, ADA/BTC could be seen back down to the demand area below, 0.00001000. Further south, eyes would be on December low area, 0.00000800.

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 111 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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Altcoins

Tron Price Analysis: TRX/USD Rallies a Chunky 20% in Three Days

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  • TRX/USD extends to the upside, rallying over 20% within the past three trading days.
  • DApp developers continue to migrate over to the Tron network.

TRX/USD was seen holding decent gains of some 4% at the time of writing on Sunday evening. The bulls are further resuming their current solid trend higher. It has gained a whopping 20% within the past three trading days. After a brief period of consolidation, between 22nd December to 3rd January, the bulls have been gunning aggressively higher. Additional buying pressure came following a breakout of a pennant pattern structure, seen via the daily chart view.

Aside from the solid technical price developments, fundamental updates surrounding the Tron foundation remain positive.

DApp Developers Love Tron

The Tron network continues to further maintain high popularity as the go to blockchain for dApps developers. A growing number of migrations have been occurring, particularly away from the Ethereum network, as developers seek alternatives. They are looking for somewhere that will facilitate for higher number of processed transactions, among other requirements.

A top Ethereum DApp, EtherGoo, a competitive blockchain based game, recently announced their decision to move over to the Tron network, away from Ethereum. This coming on the back of a growing trend across gaming DApp developers, given Tron’s large efforts to build a presence within the gaming sector.

Following the developer announcement, EtherGoo is now going to be known as TronGoo. This game rewards players with crypto for depositing Goo, promotion of the game, token stealing other users, among others. Previously the reward was in ETH, but now users will be rewarded with TRX.

Technical Review – TRX/USD

TRX/USD daily chart. Bulls are strengthening their move to the upside. Next target zones are highlighted on the chart.

As detailed, the bulls managed to execute an explosive move out from a pennant technical structure. This saw an additional wave of buyers come in, assisting TRX/USD to further elevate. The price is testing the 24th December high area, $0.024355, where sellers previously came in.

A break above the mentioned area of resistance, will likely provide further win behind the bull’s sails. The next zone of interest is seen just above, which can be seen tracking from $0.026000-$0.028000. TRX/USD has faltered here on several occasions between August to October.

Finally, should upside momentum maintain its current course and breach the detailed supply zones, then $0.040000 will be eyed. The price was last seen here back in July 2018, before TRX/USD fell hard.

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 111 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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Bitcoin

Bitcoin Will Reach New Record High in 2019, XRP Could Compete with SWIFT: Weiss Ratings

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As Tom Lee has learned by now, predicting the future of cryptocurrency is usually a worthless pursuit. If we can’t predict financial markets with any degree of accuracy, what makes us think we have a grasp on the future of a nascent technology that has challenged our traditional view of money? Still, these limitations haven’t prevented researchers, rating agencies and even major financial institutions from trying to come up with answers.

With this in mind, we stumbled upon the latest cryptocurrency forecast from Weiss Ratings, a Florida-based rating agency. Weiss rose to prominence in the blockchain world last year when it became the first rating agency to evaluate and score cryptocurrencies based on their technical infrastructure. As we reported last January, the first set of ratings weren’t pretty.

Bitcoin 2019: New Record High

Weiss’ boldest prediction is that bitcoin will reach a new all-time high this year. Their rationale isn’t too dissimilar from the one echoed by bitcoin’s most ardent supporters: namely, (1) BTC has experienced bigger downfalls before only to emerge stronger each time; and (2) BTC will see increased adoption as a store of value.

Read: Bitcoin Price Hits New Yearly Low; Now is Best Time to Buy, Says Weiss Ratings

Flipping this argument around, it may be more useful to look at bitcoin’s yearly lows to determine where prices could end up in the future. As it turns out, bitcoin has printed higher yearly lows in six of the last seven years. This observation was recently laid out on Twitter by @1stCrassCitizen:

Bitcoin’s yearly lows:

  • 2012: $4
  • 2013: $65
  • 2014: $200
  • 2015: $185
  • 2016: $365
  • 2017: $780
  • 2018: $3,200

The author has speculated before that the current downtrend in crypto prices may stretch out several years as altcoins face their existential crisis and bitcoin finds new adopters in institutional circles. But that doesn’t necessarily mean that bitcoin is headed lower; it simply means we may have to wait much longer for a new ceiling to emerge. (The 2017 crypto boom was perpetuated by an influx of retail traders and laymen accessing the market for the first time. A look at Google search trends and other metrics suggest interest in bitcoin/cryptocurrency has declined sharply among this large cohort since the bubble burst.)

XRP Disruption

Ripple has made significant inroads into the traditional payments arena and its xRapid/xCurrent technologies are being piloted by banks, wire transfer services and other market players. Against this backdrop, Weiss speculates that Ripple’s XRP could be on a collision course with SWIFT, the massive payment network underpinning the global banking system.

According to Weiss, if XRP “can manage to chip away at SWIFT’s market share and even replace it in some areas,” there’s a chance it could become the world’s largest cryptocurrency.

XRP flipped Ethereum in the market-cap rankings several times last year. The company has been hit by several lawsuits from disgruntled investors claiming it is a security. Ripple has hit back by forming its own political advocacy group in Washington.

Rise of Obscure Coins and the Fall of Bitcoin Wannabes

Cryptocurrencies that try to mimic bitcoin – i.e., bitcoin cash, bitcoin SV and Litecoin – are likely to fade over time, making room for more obscure coins like Holochain and Hedera Hashgraph to climb the market rankings. According to Weiss, these are “non-blockchain distributed ledger projects that could become the new trust layer of the internet.”

Bitcoin’s look-a-likes, on the other hand, lack innovation and will probably be dumped in the future.

In terms of market-cap rankings, we have seen Litecoin decline steadily within the top-ten while bitcoin cash has had a firm grip on the no. 4 spot. Bitcoin SV has become the no. 9 coin by market cap following the Nov. 15 hard fork.

Just a reminder: these aren’t my predictions nor do they necessarily reflect the views of the Hacked team. We are simply giving you additional food for thought following a highly volatile two years for crypto. Things are about to get much more interesting.

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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4.7 stars on average, based on 743 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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