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Fidelity Investments CEO Embraces Bitcoin And Blockchain, Cites Challenges

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Abigail Johnson, CEO and chairwoman at Fidelity Investments, called for more serious conversations about bitcoin and blockchain while addressing Consensus 2017 blockchain conference in New York City, according to MarketWatch.

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Fidelity has tested bitcoin and blockchain, according to Johnson, including partnerships, venture investments and its own initiatives, but most of its experiments have hit a roadblock due to the emerging nature of the technology.

Four Challenges Cited

Johnson identified four problems for cryptocurrency to overcome to gain widespread adoption.

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There are still unresolved technical issues. Bitcoin ledgers have been hacked on numerous occasion, delivering catastrophic losses. Privacy is also an issue that has to be overcome.

The fact that bitcoin is connected to a digital footprint makes bitcoin accounts targets for hackers. Investopedia referenced a report that North Korean hackers were behind the hacking of bitcoin wallets resulting in $80,000 in losses.

Johnson also said there is a regulatory problem since the pace of innovation is faster than regulators’ ability to keep up with it. Regulators may lack a “mental model” for understanding how to regulate the technology.

She encouraged the bitcoin community to establish an open dialog with regulators to address consumer interests and ensure blockchain technology achieves its full potential.

The open nature of bitcoin and other cryptocurrencies results in a control challenge, Johnson said. She said companies that create products on cryptocurrency platforms lack clarity on the path they can take or how they influence developers.

Private networks that are popular among financial companies on account of their focus on security lack clarity on control structures. This can result in difficult decision making and confusion.

The Human Problem

The last problem Johnson addressed was the human problem. She said the bitcoin community has to create use cases that drive clear benefits for institutions and individuals.

She noted that her team at Fidelity studied a bitcoin wallet and provided users with a recovery phrase used to recover the wallet contents.

The subjects of the experiment responded in three ways. They applied existing mental models like using the phrase for a single-use activation code or using it for password recovery, for creating new models or leaving the system completely.

One reason for the team’s response was the lack of enough use cases for cryptocurrencies.

Fidelity Steps Forward

Johnson said the Fidelity headquarters cafeteria has begun to accept bitcoin. An early bitcoin adopter in the office performed an experiment where he tried to use it the way he used traditional money. He was able to buy a drink, but not return it, a limitation that caused great frustration, highlighting the ways bitcoin is not yet making things easier for consumers on a daily basis.

The systems not only need to be technically better, but more user friendly, Johnson said.
Despite these concerns, Johnson said she was optimistic about the future of the technologies.

She said hopes bitcoin and blockchain succeed because they make it easier for more people to invest and to use financial services in a world where artificial intelligence and the Internet of Things are increasingly dominant.

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Analysis

Long-Term Cryptocurrency Analysis: Bitcoin Outshines Altcoins Again

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The most valuable coin had another encouraging week, as it emerged from a brief but violent correction, just to reach new highs towards the end of the week, draining capital from altcoins. The total value of the market is stagnating near the all-time high, but BTC crossed the $100 billion mark as it surged past the $6000 price level, controlling 58% of the market.

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With the long-term MACD clearly being overbought, and as the long-term target has been hit, investors should now be looking for exit points, even as the short-term uptrend is intact. The range projection target of the recent correction is found at $7000, but correction risks are already high, and only small positions should be kept in the current setup.

BTC/USD, Daily Chart Analysis

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Most of the major altcoins are trading in narrow ranges this weekend after a slightly bearish week, as the optimism surrounding Ethereum’s major update faded and the second largest coin re-entered its previous range.

Litecoin, Dash, and Monero are still looking encouraging despite the lengthy correction, while the recently, while the relatively weak Ethereum Classic IOTA continue to show worrying signs. As the Bitcoin long trade is getting stretched,  let’s see the how the daily charts of the altcoins are shaping up.

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Bitcoin

Bitcoin Hits $100 Billion as Record Rally Continues

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Bitcoin’s epic rally intensified Friday, as the token reached $6,000 for the first time in its history, bringing the total market value above $100 billion.

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Bitcoin’s Fresh Intraday High

BTC/USD touched an intraday high of $6,064.14, bringing its total market cap to $100.8 billion. That’s roughly $85 billion higher than where the market started in January.

At press time, bitcoin was trading around $5,993, up more than 5% on the day. From a technical perspective, the digital currency is considered overbought. However, the technicals are typically less reliable during extreme price movements like we’ve seen in recent weeks. The world’s leading cryptocurrency has added a staggering 520% this year.

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Bitcoin’s rally didn’t really extend to other cryptocurrencies Friday. Ethereum continued to trade just north of $300, while Ripple (XRP) consolidated a hair below 21 U.S. cents.

The cryptocurrency market’s combined market cap is roughly $173.4 billion, which is roughly $3 billion less than the Monday’s peak.

$10,000 Bitcoin?

Bitcoin could be heading north of $10,000 a unit in the not-too-distant future, according to a survey conducted by CNBC. About 49% of the 23,118 people who voted in the CNBC poll said the digital currency will reach the five-figure threshold.

Roughly 16% of respondents said bitcoin prices are heading to between $6,000 and $8,000. About a third selected the Jamie Dimon option by calling bitcoin a fraud.

Though unscientific, the survey clearly shows that the mainstream is paying attention to the rapid acceleration of cryptocurrency. At least a portion of them will investigate the matter further, and likely conclude that digital assets are a welcome addition to their portfolio.

It’s impossible to associate bitcoin’s success with just one catalyst, but it’s clear that institutional support, the allure of the blockchain and favorable regulation in markets like Japan are feeding the rally. An anticipated November hard fork is also helping to shore up price.s

A Day of Milestones

Bullish sentiment also rubbed off on U.S. stocks Friday, with the Dow Jones Industrial Average extending its rally above 23,000. The blue-chip index climbed tacked on 165 points to close at 23,328.63 after the U.S. Senate passed the 2018 budget by the narrowest of margins.

The S&P 500 and Nasdaq Composite also set fresh all-time highs, with financials and industrials leading the rally.

Featured image courtesy of Shutterstock. 

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Analysis

Cryptocurrency Analysis: Bitcoin Tests $6000 as Market Settles Down

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Bitcoin is in the center of attention yet again, as the most valuable coin is knocking on the door of the $100 billion level in market capitalization. The coin touched our long-term target at $6000 on several exchanges, but it’s now trading slightly below the historic level.

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While the rest of the market is quiet, BTC is very active, and it could be in for a volatile weekend, as despite the long-term overbought readings, the short-term uptrend is clearly intact. That said, investors should avoid opening new positions here, and consider lowering their exposure further, while traders should only trade with smaller than usual sizes. Support levels are found at $5400, $5000, and near the $4650 level.

BTC/USD, 4-Hour Chart Analysis

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As the rest of the majors are still recovering from the recent correction, the total value of the segment is below its all-time high, with BTC’s dominance now standing at 57%. Most of the largest coins are little changed, with Monero and Liteocin showing considerable strength and IOTA still being the weakest of the majors. With all attention on BTC let’s see how the most traded altcoins look before the weekend.

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