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Op-Ed

Did Santa Bring a Bad Fortune for Bitcoin?

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Holiday bad season bitcoin

Happy new year to all the readers!

2017 has been a prosperous year for bitcoin as its value skyrocketed steeply throughout the year. However, the wild rise in the coin received a jolt in December. As the Christmas season ushers mirth and merriment for all, it came with a bad fortune for bitcoin traders; after touching the all-time high of $19,496 on Dec. 17, its value declined exponentially, reaching $11,590 on Dec. 22. Evidently, it was the worst week for bitcoin since 2013, resulting in an almost 40% drop from its peak price. Much to investors’ relief, bitcoin showed signs of recovery, with prices climbing gradually, touching $14,000 on Dec. 25.

Bitcoin Witnesses the Worst Week Since 2013

Bitcoin entered into one of the most devastating weeks in December. With the price sliding down to lower than $12,000, the news sent shock waves across the globe as many investors dumped their currencies.  After the record-breaking rise to $20,000, the sudden fall in the price startled traders. This price drop caused a tremendous mess in the U.S. stock market, where the companies who joined hands with bitcoin and invested their funds in the coin received a massive setback.

Such a catastrophic downfall of the overall value of bitcoin has sparked debates over its future, with some traders associating the drop with a consequence of infrastructure related problems and others blaming it for the conflict it has generated in the crypto world. What’s more, the warning from cryptocurrency pioneer Roger Ver, who concluded that Bitcoin could witness “a mass exodus of people rushing for the door”, has caused a lot of turmoil in the market.

Don’t know whether to quit or “hold” through the chaos?  Before making decisions in haste, read up about bitcoin’s forecasts for 2018. 

Rival Coins

On the onset of such confusion, many analysts fear the decline of nitcoin may lead to migration to other rival currencies. Does this decline signal good news for the rival currency? Overall, the rival cryptocurrencies also dropped, as the total value of the market steeped as low as $440 billion.  However, these losses improved the prospects for the smaller coins, with many investors migrating there to mitigate the crisis. Today, bitcoin is looked upon as speculative, leading many traders to migrate to other coins like Ripple, Cardano, etc. So, the altcoins can greatly benefit from this crisis, as traders who enjoy cryptocurrency can switch to alternative assets to avoid cashing out of the crypto market.

Why Bitcoin Dropped So Low?

Bitcoin’s streep drop has also led to a decline in other cryptocurrencies. So, what is the reason behind the 20% drop in the global market? Take a cue from the following points that attempt to summarize top theories that have taken the internet by storm.

The Holiday Season

The end of the year marks some of the major holidays, from Christmas, Hanukkah, to New Year. So this festive season is a critical time for making investments. Most traders strive to withdraw their profits during this time. The cryptocurrency market is relatively new and volatile, so many traders make speculative investments. These speculative investors tend to cash out on early profit and do not “hold” through the turmoil. Since the close of the year is the ideal time for traders to translate their profits into cash, it is not such a favorable time for investments.

Altcoins

After the steady hike in bitcoin, altcoins like Cardano, Qtum, Ripple, and TRON have also witnessed substantial gains. The market value of these coins also affects bitcoin’s price. With traders leaving for altcoins and transferring funds from BTC, the market has become destabilized.

Hacking

A number of crypto exchanges have collapsed this year. At the beginning of the month, the Securities and Exchange Commission (SEC) discontinued PlexCoin due to allegations of ICO scams. In addition to this, the Korean exchange called Youbit was hacked Dec. 20, losing a large percentage of its assets. These events have created a lot of confusion among traders.

BCH-BTC Clash

Following the August fork, many bitcoin investors landed in trouble. With Coinbase supporting bitcoin cash, many traders switched their loyalty. Many amateur traders tend to mix up the two currencies, so the volatility of the BCH market may have planted wrong notions about BTC.  If experts are to be believed, such a clash between BCH-BTC has caused the decline in the price.

The Bubble Popped

Many cryptocurrency skeptics trivialize bitcoin, calling it a bubble. The sudden drop in price has sparked a lot of noise in the market. Does this fall signal the bursting of the bitcoin bubble?  Going by the opinions of the crypto critics, the popping of the bubble anticipates the end of bitcoin as we know it.

The Silver Lining

Following a steep decrease in price, the market is gradually climbing back. The steady rise in the price of bitcoin has prompted traders to seek the forecast for next year. Will bitcoin suffer from this fall or will it continue to surge? The current predicament has given rise to vehement debates. While many critics feel this decline signals the popping of the bitcoin bubble, cryptoanalysts believe it will rebound and rise steadily in the coming year, breaking all existing records. With a large section of traders branching out to bitcoin cash, critics feel the bitcoin price will fall further.

bad holiday season bitcoin

Chart Showing the Rise of Bitcoin

Two theories have become popular on the internet; while some predict it’s time for the bubble to burst, expert analysts state that there will be a possible hike in bitcoin’s value. In fact, bitcoin may even cross $30,000 by the middle of the next year if experts are to be believed. In the thick of all the confusion, there is a silver lining for bitcoin investors, as the figures are creeping back slowly following Christmas.

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 9 rated postsHira Saeed is a tech geek girl with a passion to write on latest technology trends. She is the Founder of Tech Geeks community in Pakistan and also runs her copywriting and social media agency, Digital Doers. Follow her on @heerasaeed.




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Articles

Are Crypto News Sites Allowing Freedom Of Thought?

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As the interest in cryptocurrencies has exploded during the past couple years, crypto news sites have been on the rise.  These sites are quickly becoming an invaluable resource for traders who enjoy learning about new crypto projects and trade ideas.  The content distributed through these platforms is typically created by a combination of full-time staff and guest contributors/bloggers.  Many of these writers also have a lot of experience in crypto trading so the articles are extremely beneficial for readers.

One thing that readers should always keep in mind is that the content from these sites normally represents the independent thoughts of the writer.  This is important because writers/traders aren’t infallible.  They can make mistakes like all of us.  So, the best approach for readers is to try to attain a diversity of thought.  A diversity of thought means to gather as much information as possible, from a wide selection of sources.  This is absolutely necessary before reaching a conclusion on a certain topic.

But what happens when a website prevents writers from writing about specific topics?  A colleague of mine recently tried publishing an article at Coinnounce.  The writer wanted to publish an article about the buying opportunity that the Bitcoin crash was affording investors.  Normally an article is rejected for legitimate reasons such as poor grammar, plagiarism, or promotional work.  Unfortunately, Coinnounce cited that the website was bearish on Bitcoin and that they wouldn’t be publishing bullish articles.  Even more troubling is that when Bitcoin rebounded in price, Coinnounce reached out to my colleague and told him they would now be willing to publish the bullish article.

When I found out about the rejection and the reason given, I decided to browse the Coinnounce website (which I had never heard of) to find out what kinds of articles were being published.  And sure enough, the articles were nearly all bearish in some fashion.  The problem with this approach is that nobody knows where Bitcoin is going.  It’s 100% speculation.  What actually matters is the logic presented in the article that helps back up a prediction.  So, while Coinnounce is free to run its business as it sees fit, the website (or the articles published) should have a disclaimer that the information presented represents the thoughts of the website’s owners/editors.  Otherwise, readers may not have a clear understanding of what is being presented.

The point of this article is not to call out Coinnounce.  Rather, the point is to make sure readers are aware that some sites may have different motivations than others.  It’s important to read from a variety of sources to get as much information as possible.  This is true not just for cryptocurrency markets, but for everything in life.  I’m proud to write for Hacked which runs an open and honest platform.  The articles written do represent the thoughts and feelings of the writers.  So, while the editors may not always come to the same conclusions that the articles do, they will never suppress freedom of thought.

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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Op-Ed

The Underlying Assets are Getting Squeezed

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An interesting phenomenon has emerged in the last 3 or 4 months. It appears as if many of the core underlying investment assets of the economy are getting steadily killed in the markets. This is observable in FANG stocks (Facebook, Amazon, Netflix, and Google) as well as commodities like crude oil and iron ore.

Additionally, Bitcoin has continued to get hammered during this absolute beat down on the economy. Many pundits have come out and talked about how this is the “end of Bitcoin” or how this is Bitcoin finally finding its true value, but something far more important is at work here.

Deleveraging During the Credit Squeeze

For anyone who hasn’t been reading the news over the last several months, the actions of the Fed (and other central banks) have been under considerable analysis. The previous decade has seen some of the easiest money in the history of our economy. Easy money refers to the cost of borrowing. The lower the cost (interest rate), the easier the money is considered to be.

So as we start to see the credit markets change in a way that makes it a lot harder to borrow money, a credit crunch begins. This is when there is a shortage of credit (lending) and borrowers are forced to pay back parts of their loans, or at least not take out any new ones. And as a direct result, they can’t afford to maintain certain investment positions.

Their inability to maintain these positions means they need to sell off their holdings in the same way a short squeeze causes short sellers to need to buy back the security they were shorting. A credit crunch closes a lot of positions.

The economy-wide effect this is having is both predictable and scary, because we don’t know how far all these underlying assets are going to fall before they stabilize. In the mean time, there will be drastic political effects as a result. The policies of central banks have come under scrutiny in recent months thanks to comments by President Trump, and now that a tighter monetary policy is being put into play, we are going to see much lower dollar liquidity in the future.

Zooming in on Bitcoin

So with all of these assets “puking on themselves”, or deleveraging, we are seeing some interesting dynamics unfold. In Bitcoin, capitulation is occurring on both sides of the asset, which is exactly what is necessary to reverse this trend in the future.

You can see traders instinctively realize that the “dead cat bounce” that normally occurs as shorts get squeezed out in the $4k range is much more muted now. This is because many of the shorts have already closed their position. Longs are doing the same as they bought in at what they thought was the bottom, even as recent times have proven them to be mistaken.

This is going to work out as a good thing for Bitcoin in the long-term, as it could be the end of the massive downmarket it has experienced all year and a new time to shine. At the very least, it could create a good “bottom” for opportunistic buyers to hop in and average their costs down a bit.

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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Altcoins

60 Minutes Showcases Potential of DNA and Genetic Genealogy; Opportunity for Crypto Investors

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DNA Storage

Throughout the years, 60 Minutes has been responsible for reporting on some of the biggest stories in the world.  Many of the most memorable episodes have involved world leader interviews, stories on endangered animals, profiles of famous celebrities, and occasionally, segments on promising developments in business and science.  A week ago, 60 Minutes had a very interesting report on how the authorities used Genetic genealogy to solve the case of the Golden State Killer, and how the authorities plan to keep using this new field to solve more cold cases in the future.

On April 25, 2018, authorities in Sacramento announced that they had solved the notorious case of the Golden State Killer.  Authorities were able to use a promising new technique called Genetic genealogy to help identify 72-year-old former police officer, Joseph DeAngelo, as the suspected killer.

Genetic Genealogy

Genetic genealogy is a mixture of high-tech DNA analysis, high speed computer technology, and family genealogy.  The end goal is to determine the level and type of genetic relationship between individuals.

In the case of the Golden State Killer, DNA came into play because the killer had committed at least 12 murders, 50 rapes, and many home burglaries.  Investigators were able to obtain DNA from the killer at one of the reported crime scenes.  After many years of frustrating dead ends, a cold case investigator submitted the obtained DNA sample to GEDmatch.  GEDmatch is the largest public genealogy database in the world.  After uploading the sample, authorities were able to generate a handful of leads which eventually led to the front doors of Joseph DeAngelo.

In addition to the Golden State Killer case, authorities have used Genetic genealogy to make arrests in at least 11 other cold cases.  While the science appears to be sound, there is a legal question that has yet to be answered.  There is no doubt that attorneys for the accused will raise the question of privacy and whether using databases, thought to be private, should be legal.

Opportunity for Crypto Investors

While I’ve invested in equities and crypto for many years with varying degrees of success, I’ve never had the opportunity to invest at the beginning of a new frontier.  Fortunately, the opportunity has come.  Encrypgen (DNA) is a genomic blockchain network that provides customers and partners with best-in-class, next generation, blockchain security for protecting, sharing and re-marketing genomic data.  This creates a fair marketplace for a person’s DNA that can be stored private and sold (if a person wishes to do that).

Over the past few months, Encrypgen has been gaining attention in the mainstream media because of their revolutionary technology as well as the fact that their closest competition is still years away.

In August, Encrypgen released a beta version of its Gene-Chain.  The Gene-Chain allows consumers to upload their genetic profile and for researchers to purchase that genetic data.  Within the next 2 weeks, the company plans to release the full version of the Gene-Chain which will officially make them a new pioneer in the field of genomic blockchain security.

With the DNA token hovering at approximately 5 cents, the time is running out to accumulate at bargain basement prices.  I fully expect the token to achieve utility in the next several months which will cause a rocket-like explosion in the token price.  There is no looking back now, only forward, and I love what I see.

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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