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The Ripple Debate Continues as Coinbase Considers Listing XRP

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What happens when the largest cryptocurrency exchange refuses to list the third largest cryptocurrency? Much of this has been related to the management and strategy behind Ripple, and Coinbase’s hesitancy to align themselves with such a controversial coin.

We are facing new questions as Coinbase gives signals that they may finally be considering listing XRP on their exchange. The biggest question is if this will change how the SEC views XRP, and if this is the tipping point that may get it deemed a security.

XRP Not a Security

For Ripple to be a security, it would have to have to be proven to represent ownership in a company. This is problematic for a lot of reasons, but mostly because it would require heavier regulation than if it were viewed as a commodity.

The often repeated distinction by Ripple CEO, Brad Garlinghouse, is that is that Ripple and XRP are two separate entities. You can think about it as the difference between the currency a company uses and the profits of a company. They are related, but definitely not the same.

As Mr. Garlinghouse has said, securities give you rights to governance, dividends and ownership of a company. XRP sells presents none of these benefits.

However, the argument is that many investors view them as being so intimately connected that when Ripple announces a new partnership, the price of XRP increases. This is where the marketing may have been deceiving, and why many view XRP as being a shadier coin, regardless of its massive market capitalization.

The Outcome Doesn’t Matter

You might be wondering why it is such a big deal if XRP is deemed a security or not. The main change would be that many cryptocurrency exchanges would be less likely to want to handle it due to the drastically stricter regulations that are present on securities and protecting investors in securities.

This shaky legal status has been compounded by many unsubstantiated claims coming out a community that many would refer to as “ideological”, and that might actually be making things worse.

There is an alternate view as to what would happen if XRP was declared a security. Once declared a security, XRP could feasibly be listed on major equity exchanges (something some investors were itching for last year). This would result in a continued run-up in the price as investors would have increased access to the so-called “security”.

What It All Means

With this recent news regarding Coinbase, many think that XRP is finally going to become listed, after they have had so many false alarms over the last two years. The recent XRP news caused a significant run-up in the price of XRP, which was to be expected. The bigger question about whether it will be branded a security may have much more to do with the liquidity and regulation behind XRP.

The fact of the matter is that XRP will continue to function regardless if Ripple is in operation. The larger debate of whether investors should tie their investment theses for utility tokens to the profitability of the overall company is still yet to be settled.

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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Blockchain

Blockchain and Real Estate: An Industry Overview

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Blockchain is going to change nearly every industry under the sun, but the effect will not always be the same. The big strengths of blockchain technology are efficiency, security, and transparency, and each industry will be affected in a slightly different manner.

Real estate is one example of an industry that presents a huge opportunity for the technology, with different areas showing weakness and providing a chance for the technology to reign supreme.

How Real Estate Connects to Blockchain

The fact is that distributed ledgers provide a level of efficiency that current systems lack. The technology also prevents fraud and increases trust in the system, since all the information is public. Finally, even though blockchain technology is transparent, it is also private.

Combine all these features, and you have a big winner of an innovation. One of the topmost predicted innovations is the tokenization of assets, which will lower transaction costs and open up commercial real estate to more retail participants.

The three most sought after purposes for blockchain technology are smart contracts, transfers of value, and record keeping.

Current Big Players

As would be expected, the biggest companies have the largest opportunity for growth within the space. For example, Propy was founded in 2015 and raised $15 million for a platform that allows for international home purchases. It is essentially AirBnb for foreign investors, but operates in a much more efficient manner.

Harbor fulfills a more niche function by helping list real estate and private equity assets in an SEC compliant manner. There is huge value in adding liquidity to these assets, and the ability to resell them adds even more liquidity. However, current regulations prevent the trading of these security tokens, if at least for the time being.

Finally, you have a company like Ubitquity that focuses on the record-keeping aspect of real estate, which is probably where the most inefficiencies are. The innovation here is simple: humans make errors, blockchain doesn’t. It also can’t be incentivized to commit fraud and works as an AI solution to much of the problems in the space.

What’s the Hold Up?

Right now, one of the biggest holdups is the nascent stage of the technology. No one can decide upon the proper consensus protocol, and that has slowed down its chances of being accepted by the industry-at-large anytime soon.

Processing speed is also a common objection that needs to be faced before a scalable solution begins implementation.

It is expected that the real estate industry will adopt blockchain technology in accordance with their clients’ needs. Whether occupiers or investors have adopted it will have a huge effect on their decisions to adopt it. Based on past experience, banks and insurers are likely to be some of the first to adopt the technology.

Analysts in both the technology and real estate industry tend to agree that it is reasonable to expect widespread adoption within a decade, with many more individual applications being formulated  along the way.

As an investor, the best course of action is to investigate the individual use cases, and make a decision based on which one you believe will have the strongest future in each space.

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

Zcash Price Analysis: ZEC/USD Flood Gates Open After Breakout and Retest from Pennant

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  • ZEC/USD licking its wounds with deep double-digit losses as the market continues to take a beating.
  • Next major areas of support are eyed at currently levels around $89.50 and then $75.

Zcash has been under chunky selling pressure, no thanks to the larger weakness seen across the broader crypto market. The ZEC/USD exchange rate is nursing deep losses, running at two consecutive sessions firmly in the red. At the time of writing, the price has dropped over 25% in the last two sessions. This extended downside comes after a breach and retest from a pennant pattern.

ZEC/USD daily chart

ZEC/USD had moved within the above-mentioned technical set up since 12th September. The formation of this set up took shape following a deep market sell-off from the back-end of July to mid-September. Price behavior was very much consolidation mode, forming this pennant. Playing out to the textbook, a breakout from the set up was seen.

Further on the above, the firm daily breach came on the 14th November. The few daily sessions that followed this were within consolidation mode. Subtle retests underneath the broken pennant were seen. The Monday session saw the extension further south after the brief retest period. The bears smashed through the big psychological $100 mark, leading prices to the downside.

As a result of the above price developments, ZEC/USD selling pressure has forced a move on the current daily candlestick below a vital demand area. While the $105 – 95 range has proven to see buyers sweep in, sellers are proving to be too much to handle. This area previously served as a strong safety net, on 12th September, where decent buying came into play.

Support Levels

ZEC/USD weekly chart

Viewing the weekly chart, the bears are currently testing the lowest levels seen since May 2017 to the downside. This is seen just below the $90 level. Looking further south, the next major downside target is seen at the $75 area. This is a weekly support level, which was last in play back in April 2017, when the price started to pick up bull momentum.

A breach of the above-mentioned areas could be catastrophic. Eyes would then be on ZEC/USD potentially free-falling a further 50%, down within $40. This would be the next major consolidation area that could provide some firmer footing. The price last traded here in March 2017. This would be the very extreme scenario but cannot be ruled out.

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.

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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 60 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

Bitcoin Cash Price Analysis: BCH/USD Hard Flops as Price Moves Within the Abyss

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  • Bitcoin Cash price falls into uncharted territory, struggling to find a bottom.
  • Weekly chart still points to further downside, RSI not within oversold territory as of yet.

The Bitcoin Cash price remains heavily on the back foot, the standout under-performer across the major altcoins. BCH/USD is currently running at three consecutive sessions of losses. The streak could have been much longer, however the price was given a breather ahead of a pick up in downside intensity. In the past two weeks, BCH/USD has dropped over 60%.

As covered in an article earlier in the month, BCH/USD failed to break down a key area of supply. This was seen within the $650 territory; the price had faltered here in early September. It was forced back down to the south, to then retreat at some neckline support, $410.

BCH/USD daily chart

The most recent occurrence within the above-mentioned supply zone was seen between 6-8 November. Heavy sellers piled in, forcing the price initially down to the neckline support, $410. Between the 15-19th November, BCH/USD had breached, retested and consolidated around this area, before a resumption of further bloodshed.

Downside Targets

Looking via the weekly chart, the BCH/USD exchange rate demonstrates that the price is literally falling into the abyss. This fall is very much uncharted territory, so the bears are free to drive this a far south as it needs to be taken. In terms of the RSI, this indicates that there is still some room for this to be driven lower. It has not quite reached oversold territory yet.

BCH/BTC weekly chart

When observing BCH/BTC, at the time of writing the price is testing the previous session’s low. This area is significant as it provided much needed support in October 2017. A break here and close below 0.04775 could be punishing. This again is movement into an unknown realm of price action, so it remains unclear where the bottom will be at this time.

Upside Targets

In terms of upside barriers, given the recent price action, new areas of resistance have been formed. Firstly, around the $370 level, as this was the former acting support during the consolidation between 15-18th November. Furthermore, eyes would then be on a retest of the breached neckline former support, $410. Lastly, should both these areas be conquered again, the supply from $600-650 would be next up.

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 60 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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