Facebooks Libra, Twitter, Nation-Backed Digital Currencies, China and Other Macro Trends

Lets look at some macro trends circling the esoteric inner core of this ongoing technological revolution. First up theres Facebooks Libra, which currently is a swirling mass of confusion. Its clearly become a major part of the worlds biggest social media giants roadmap and theyre throwing a lot of resources at it. For crypto generally, its a huge affirmation of the technology and has been utterly out of the realms of expectation just a few years ago. As expected, however, with an entity as big as Facebook, Libra got the worlds major power structures hot under the collar, given that a global stablecoin, accessible to billions of people around the world, goes straight after governments grip on monetary policy, which is effectively like trying to wrestle away the ultimate superpower of state.

The major nation state in question, the US, responded by calling those responsible to a hearing where officials, that clearly never read the briefing on what Libra is trying to be, shouted totally irrelevant questions to the treasonous upstarts, betraying the true aims of these hearings, which is to do nothing more than grandstand and bang a drum along party lines. If that wasnt enough, they then fired off breathtakingly threatening letters to members of the Libra association with the clear intention of performing audits, which worked just as intended, with Visa, MasterCard, eBay and Stripe all quickly stepping away from their previous intention to join Facebooks Libra network. In 2020, we will see this dance begin to intensify, most likely not only with Facebook but many other powerful players in different regions, think Uber, Grab in South East Asia, possibly Softbank in Japan, the already existing payment networks of WeChat and Alibaba in China and well also see nation-states joining in the competition. Soon after this things will come to a head, perhaps in 2021 when Facebook and others will be forced to launch outside of the US, in smaller jurisdictions as pilot programs. This will hamper their ability to gain strong network effects and end up being the perfect talisman for why decentralisation, in the face of entrenched power structures, is the only way to proceed if the intent is to provide a new means of transacting value globally inclusive of the whole world.

What superpowers like the USA seemingly misunderstand is that although Facebook has lots of users, many more than Bitcoin, their power is already being whittled away by the very fact that permission-less, decentralised digital currencies, for the first time in history, provide a new option and choice for people to exit from centralised fiat currencies that have an average life expectancy of 27 years. It may take decades, but that paradigm shift is not going back in the bag. Jack Dorsey at Twitter has a much better grip on that power boiling away in the background and has just announced hes set up a research team to investigate how to decentralise the entirety of his platform, Twitter as the decentralised protocol. Validation once again?

Perhaps another global institution thats seen the light is the ECB, having set up a Digital Currency Taskforce where doubtless they will spend most of 2020 eyeing Libra from afar, writing tomes on how fiat currency can work alongside digital decentralised currencies and how theyre going to create their own special crypto recipe to try and stem the ever-growing tide of permissionless stablecoin usage. This is no doubt what Christine Lagarde means by saying they plan to get ahead of the curve but in reality, to really get ahead, theyd have to decentralise themselves and thats a tad hopeful perhaps.

The year 2020 will see yet more strange antics from the worlds most populated country. China is at the very heart of the Bitcoin ecosystem because the mining world, that secures the Bitcoin network with massive computing power, relies on cheap energy and a major percentage of the Bitcoin networks mining farms find endless amounts of close to free energy, by camping out around the many nuclear power plants that service Chinas massive ghost cities. But thats not all! Its going to get even stranger, as we watch Chinas government battle with two sides of the same coin. Theyre clearly enthralled by the prospect that a state run blockchain could bring a paradigm shift in its intent on surveilling its populace, but their desires to harness the technology might by necessity usher in a swathe of decentralised technologies that even the great firewall couldnt keep at bay. Perhaps this technology is the ultimate trojan horse? Tune in for the next episode in 2020 when they release their state run DCEP cryptocurrency, take the vast spending data theyll capture and add it into their citizen points scheme database and then triangulate all of this in real time with their pervasive facial recognition systems and hey presto, they go from 2020 to 1981 at the flick of a switch.

Now lets explore what the future looks like through the lens of each of the main areas of the blockchain ecosystem. As we at KR1 see it, the areas of most interest are Bitcoin as a digital store of value, macro trends including Facebooks Libra and other corporate or nation-state-backed currencies, the flourishing Ethereum ecosystem especially in Decentralised Finance (DeFi), specific competing projects to watch closely and the wonderful world of non-fungible tokens.

As the Bitcoin narrative still forms the backdrop to the ecosystem, both in terms of new participants entering into the space and price action, lets begin there. Were at a critical stage in Bitcoins price trajectory. We had a parabolic rise from 2016 through to the end of 2017 with the price peaking at just under $20,000, followed by a 54 week bear market which saw close to an 87% retracement in price down to a value of $3200. This was the 4th such retracement since the birth of Bitcoin in 2009.

Between March and July 2019, we saw the pendulum swing back, with Bitcoin reaching just under $13,000, signalling an end to the bear market. Since then however weve had six months of sliding prices back to a low of $6,300 and this could well continue down to the $5,000 area towards the middle of January 2020. However, we think that with the clear over-enthusiasm that signalled the end of the bear market, combined with the strong fundamentals behind the scenes such as hashing power, transaction volume and new Bitcoin wallets being created, Bitcoin will most likely bounce back strongly from a steep dive in price and return to the $7,500 mark and then move higher into the middle of 2020. Its important to understand that Bitcoins issuance model, with the halving coming up in May 2020, combined with a strong digital gold narrative and the dominant hard money philosophy of the asset, which maintains a very powerful set of strong hands will create many boom and bust cycles, you could say theyre somewhat baked into the protocol by design.

Away from nation-state superpowers and Bitcoin, diving a little deeper into the technology, the area causing the most commotion and interest is Decentralised Finance (DeFi) on the Ethereum blockchain. The DeFi movement essentially is a suite of flourishing financial applications that allow for seamless interaction and interoperability with each other. It seems there is a new project launching every other day that is building on the composability with previously launched projects. As an example of the flow available to people who hold digital assets, you could use a token swap exchange such as Uniswap to exchange the volatile Ethereum (ETH) asset to a stablecoin, that is pegged to 1 USD by market forces such as Makers DAI, send it to a smart contract lending platform like Compound, where you can lend your assets and stablecoins out for a yield and then you could cover the value held in the lending platform smart contract with an alternative insurance provider such as Nexus Mutual. In essence, this is not dissimilar to using a peer-to-peer lender to loan out money you have and earn interest in return, plus a decentralised stock market where one can exchange unlimited amounts of assets and a digital and decentralised alternative to a specific insurance contract all in one.

All of this can be achieved in very little time, were talking seconds or minutes here, without any paperwork permisionlessly and at very little cost. As a testament to the growing use of that network, the USD value of assets locked up in Ethereum-powered DeFi applications crossed an all-time high of $700 million USD recently, despite the depressed market sentiment especially regarding Ethereum. We do not expect this trend to halt any time soon, in fact we foresee major uplifts in use as the underlying systems gain trust, the applications boost their numbers, improve their offerings and become more accessible to wider audiences. We look forward to watching 2020 continue to be the year where money legos connect together to build a financial fortress.

Not mentioned so far, were seeing huge interest recently launched or soon-to-launch competing layer-1 blockchains, especially in the interoperability or application-specific blockchains ecosystems. In opposition to Bitcoins energy and computing-intensive Proof-of-Work, most of these platforms are Proof-of-Stake networks, where participants guarantee their truthful behaviour by putting up a financial deposit that is at risk instead of wasting computer resources and energy. Staking will be a major trend in 2020 and weve already seen Coinbase and Binance, the worlds largest exchanges move directly into the space. By staking assets, the process where tokens of value are used as collateral or deposit that is at risk, in return for securing the network and agreeing on transactions that happened, stakers are receiving a healthy yield. This system has become a core use case for digital assets in many projects but especially underpins two projects that we will see break new grounds over the next year, Cosmos and Polkadot. Both are providing interoperability for application-specific blockchains while increasing throughput by some order of magnitudes. As of writing, Cosmos is live with a strong community of developers and validators that form the backbone of the staking ecosystem. The key feature of Cosmos, which aims to allow for the seamless transition of tokens between different chains, is IBC (Inter-Blockchain Communication Protocol), which is due to come online in the next year and should showcase the true potential of the protocol. There are currently lots of developer teams that are building on the Cosmos technology stack (including Binance) but thus far those networks are still isolated. With IBC properly enabled well see all of these sovereign networks starting to communicate and interact with each other through the Cosmos Hub network.

Polkadot is an equally powerful system that, with a different digital architecture, aims to both allow cross chain data and token transmission while also radically increasing throughput. Polkadot lies at the core of a new vision for the internet, the Web 3.0, where data sovereignty, property privacy protections and permissionless applications become a new internet for the world. Currently a canary network Kusama is live, which aims to test many of the systems already put in place by the Parity development team, who is in charge of bringing the Polkadot network to the world. We expect to see a full roll out of Polkadot in the first half of next year and hope it will be a leap forward for the whole ecosystem.

Other technologies that deserve a notable mention for what they will achieve next year are mesh networks like Althea Mesh that bring faster and more private community-based internet to areas of the world that need it most. For example, in parts of Africa people are now getting high speed, low cost internet access when they didnt before, all enabled by Althea and the blockchain ecosystem.

There will also be clear excitement next year for tBTC, brought to us by the Keep Network, which enables a trustless bridge to move Bitcoin as an asset onto Ethereum or other networks like the previously mentioned Cosmos and Polkadot. Considering the strong DeFi trend currently, there will be those with major positions of Bitcoin that will jump at the chance to get their wealth working for a return in the rapidly expanding DeFi ecosystem.

Layer-2 scaling technologies will again be at the forefront of the space, including Matter Labs ZKsync implementation and other solutions like optimistic rollups. Counterfactual and Connexts efforts are continuing to gain traction with their state channel technology allowing developers to enable instant, low-cost Ethereum transactions in their wallets, browsers, and applications. With the complete scope of the release of Ethereum 2.0 still some time away, layer-2technologies performing settlements on the main Ethereum 1.0 blockchain will become far more prominent next year and beyond. We will also see far greater interest in privacy focused technologies such as the Nym project, who are looking to bring mixnet technology back from the computer science labs of the 1980s. Theres an opportunity for network layer privacy projects such as Nym to form a major layer in the forthcoming Web3 stack. Another project tackling this area is HOPR, who are building an incentivised data transmission system that rewards nodes for passing on messages anonymously as they Hop from node to node, before finding their true destination. When combined with an endless flow of cover traffic through the network, privacy can be fully achieved.

Lastly, a look to next year wouldnt be complete without mentioning the rising star of Ethereum adoption charts, non-fungible tokens (NFTs). Digital scarcity is no better represented than through one-off unique tokens that represent in-game items, collectibles and even art works. All areas are gaining adoption by the day with games, market places, galleries and more all appearing at an astonishing rate. Next year we will see this go into overdrive as some of the big names in the entertainment business begin to experiment with issuing their own NFTs.

Theres plenty to be excited about, far more than current prices would reflect. Were only just beginning to understand the vast breadth of use cases unlocked by programmable money, assets and scarcity in the digital realm. Each year brings new and exciting opportunities and 2020 will be no different.

Mid 2020: $7,500

End 2020: $20,000+

Originally posted here:
Forget Brexit, Think Blockchain and Cryptocurrency - FXStreet

From outrageous price predictions to the future of altcoins, crypto analysts and industry leaders are placing their bets on the fate of digital assets in 2020.

Here are seven forecasts predicting some major shifts in the year ahead.

1. Twelve months ago, Bob Loukas, a Bitcoin trader and analyst, accurately predicted what the price of BTC would be at the end of 2019. Now, he thinks Bitcoin is headed for its all-time high near $20,000 by the end of 2020.

In the absolute bear case, after a 6-month downtrend, expect a counter-trend move towards $10k-$11k before another big downtrend. If you think you will FOMO buy $10k then buy it now instead.

Bob Loukas (@BobLoukas) December 26, 2019

2. Mike Novogratz, the CEO of crypto investment giant Galaxy Digital, is also bullish on BTC, saying he expects the king coin to end the new year above $12,000.

2020 prediction #1. @realDonaldTrump loses by more than 10mm votes. #2 $btc finishes over 12k. #3. @USAWrestling wins 3 golds in Tokyo (MF). #4 @tomhanks wins the Oscar for Mr Rodgers. #5 @reform and its partners help shrink the supervised population from 4.5mm to 4mm or <

Michael Novogratz (@novogratz) December 28, 2019

3. Changpeng Zhao, the founder and CEO of Binance, thinks numerous governments around the world will experiment with blockchain and their own digital assets.

Says Zhao in an interview with Global Coin Research,

I think in 2020, we will see different experiments tried by many different governments around the globe for adoption. Some will work, some may not, but overall, they will have a tremendously positive effect for crypto adoption.

4. Ripple CEO Brad Garlinghouse predictsthat 10 of the 20 largest banks on the globe will begin to actively hold and trade digital assets in 2020 as fiat currencies go digital.

Hes also predicting that at least one G20 currency becomes fully digitized by 2021.

5. Decrypt columnist Matt Hussey echoed Zhao and Garlinghouses sentiments, predicting numerous nation states will roll out their own digital currencies this year.

6. Jimmy Song, a Bitcoin educator, thinks BTC dominance will be at more than 75% by the end of the year. He also predicts lots of altcoin delistings.

2020 Predictions Part 1:

* Bitcoin dominance will be 75%+ at end of year* Taproot will be activated without much controversy* Bitcoin price will have a bottom to top difference of at least 100%* Halving will be the big narrative

Jimmy Song () (@jimmysong) December 30, 2019

2020 Predictions Part 2:

* Lots of altcoin delistings* IEOs will lose steam* Some coin will be 51% attacked and cause an exchange to lose lots of money. Coin will go down less than 20%.* More coins will change to be merge mined with Bitcoin.

Jimmy Song () (@jimmysong) December 31, 2019

7. And last but not least, John McAfee now has only one year left to see whether Bitcoin reaches his sky-is-the-limit, dick-on-the-line forecast.

When I predicted Bitcoin at $500,000 by the end of 2020, it used a model that predicted $5,000 at the end of 2017. BTC has accelerated much faster than my model assumptions. I now predict Bircoin at $1 million by the end of 2020. I will still eat my dick if wrong. pic.twitter.com/WVx3E71nyD

John McAfee (@officialmcafee) November 29, 2017

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Originally posted here:
7 Big Bitcoin and Cryptocurrency Predictions for 2020 - The Daily Hodl

It is difficult to find a soul (especially the ones even remotely associated with the financial and economic market) who does not know what cryptocurrency or the blockchain technology is. They have taken over the world with their promising dimensions, and their popularity keeps surpassing every other form of currency as the days bleed into years and months. In a nutshell, when Bitcoin, the first cryptocurrency was first launched in 2008, no one might have expected it to rise to the zenith of success a few years in, and then give rise to several other cryptocurrencies. But here we are, after more than a decade, with Bitcoins total market cap at 69 percent of the total volume of cryptocurrencies. Thus, it requires little mention that cryptocurrencies and blockchain technology have a huge role to play in deciding the fate of the economic market.

This article is, thus, a humble attempt to look into one of the essential roles that cryptocurrency projects have in the market. The purpose of cryptocurrency projects that we are trying to investigate is none other than the raging issue of security. By the end of the article, we shall hopefully have answers to some of the nagging questions like, how well does blockchain solve the pressing security issue, how trustworthy are these cryptocurrency projects and the like.

The most significant perk of dealing with blockchain technology is that it comes with absolute transparency. There is no secrecy associated with this network except the private keys and the codes that run this digital ledger (which again only doubles the security). Data is immutable once a particular transaction is deemed completed. There is no going back or reversing the transaction, which lends to utter transparency in dealing with finances. However, the transactions are traceable, which brings down the risk of laundering and other fraudulent activities. Plus, several payment gateways like Flexipay can make use of this network to see to it that they are able to provide their clients with utmost security.

Like we have mentioned, and probably will keep mentioning a few times throughout the length of the article, that data that flows through the network of the blockchain becomes locked in and immutable. Therefore, there are very few chances of a data debacle or theft of intellectual property. Hackers shall find it very cumbersome to make their ways into the highly cryptic channel, thus keeping sensitive information safe and secure. This is also the reason why the big names in the industry like Amazon and Google have their very own blockchain network. They can keep their data locked in and secure from threats.

The Internet of Things aims at creating an integrated platform of several digital devices for the cause of sending and receiving data easily. However, with such a project on mind and application, there come associated risks. The internet, of all places, is quite fragile and volatile and interspersed with grave risks. Blockchain, with its end-to-end encrypted shape, can contribute to enhancing the security of the Internet of Things. It shall protect the systems brought together on the integrated system from potential data breaches.

Cryptocurrency projects and the blockchain technology have been setting the benchmark for security high with every passing day. It has come to a point that now it is almost impossible to imagine a scene or any aspect of life where blockchain has not penetrated and made its presence felt. Blockchain is a highly secured channel that finds its utility in several dimensions, and it is probably time to adopt it into the mainstream to tweak our security of things.

Read more from the original source:
The Role of Cryptocurrency and Blockchain In Tackling Security Issues - Baltimore Post-Examiner

Ian Balina, a native of Uganda, Africa, is the founder and CEO ofToken Metrics, is Kiana Danials guest today on Invest Divas Diva on the Block.

Ian Balina someone who lost 2.5 million dollars while streaming live on youtube, is one of the most recognized and probably the most controversial personalities in the crypto community. He left behind his data analytics and IT jobs at companies like Deloitte and IBM to become a full-time crypto investor and researcher.

In this episode of Diva On The Block Ian and Kiana talk about:

His journey from Uganda, to the US Why he quit his secure job at IBM to work full time in crypto Why he focuses on ICOs and how he manages his risk His thoughts on transparency How he and his team are using AI, machine learning and data analytics to create investment strategies, and whether hes just using these words as a buzz word, or theyre actually using it I also chat with him about his upcoming project, Token Metrics, an investment, research, and media platform to take cryptocurrency investing mainstream.

After you watch the video,go to the comment sectionand let me know what you think of my discussion with Ian Balina and his new mission with Token Metrics.

Ian immigrated to the United States with his family at eight years old. He attended middle school and high school in the USA and would go on to attend The George Washington University (GWU) in Washington, D.C. on an academic merit scholarship. He would graduate GWU with a Bachelors and Masters in Computer Engineering.

Title:Influential Blockchain and Cryptocurrency Investor, Advisor, and Evangelist, and the Founder/CEO of Token MetricsWebsite:https://ianbalina.com/Linkedin:https://www.linkedin.com/in/ianbalina/Facebook:https://www.facebook.com/ianbalina/Twitter:https://twitter.com/DiaryofaMadeMan(138.5k followers)Instagram:https://www.instagram.com/diaryofamademan/

While at GWU, he got the entrepreneur bug and founded his first startup, Leximo, the worlds first social dictionary. After working on Leximo, he went on to work as an independent software developer, then as an IT consultant for Deloitte, the worlds largest consulting firm.

Ian later joined IBM as an Analytics Tech Evangelist, where he helped evangelize and sell the IBM Cloud and Big Data Analytics Portfolio in North America. Ian helped drive revenues in the millions of dollars per year. He was recognized as one of IBMs top employees by being a member of the IBM Hundred Percent Club, due to achieving more than 100% of his million-dollar sales quota. After four years with IBM, he retired from the corporate world to become a full-time cryptocurrency investor.

Ian Balina is also an influential Blockchain and Cryptocurrency Investor, Advisor, and Evangelist. He has appeared in The Wall Street Journal, Forbes, CNBC, Huffington Post, The Street, INC and Entrepreneur Magazine for his work in analytics, cryptocurrencies, and entrepreneurship.

According to TheRichest.com, Mr. Balinas net worth is $6 million dollars

Ian started Diary of a Made Man, his video diary of his journal in life and in crypto investing. He became one of the worlds most prolific ICO influencers in 2017 while growing his portfolio from $37,000 to $5.36 million by January 2018. In April 2018, Ian Balina fell off his perch after sustaining a hack of his personal wallets in which he lost almost $2.5 million.

Ian is a founder and General Partner at 100X Advisors, a global blockchain investment and advisory firm,. The firm has made 15 investments in 15 different countries in the last year. He has brought a data-driven, money-ball approach to investing in blockchain startups, called Token Metrics.

Token Metrics is a data-driven cryptocurrency investment research platform that helps retail investors leverage analytics and machine learning to become better investors.

The BTC/USD pas remained below the dailyIchimoku cloud. It now appears to have bottomed out just above the key support level of $6,406.

The pair may even be in the process of forming aDouble Bottom bullish reversal chart pattern.

However, the bearish momentum still appears to be strong. A break below this key support level could open doors to further declines. Could Bitcoin reach the $4,000 again?

What do you think about Ian Balina and his controversial background? Do you think hes a scammer out there to get people? Or do you think he truly has the best interest of people in mind?

Go to thevideos comments sectionand let me know.

This article was originally published on InvestDiva.com.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

See the original post here:
Ian Balina, The Controversial Face Of Cryptocurrency - Nasdaq

While cryptocurrency mass adoption in the Middle East may still take a little more time to take place, there are several countries in the region that are truly taking notice.

From the UAE to Saudi Arabia, Bahrain, and Lebanon, some private and public entities are willing to take the risk by embracing the new technologies earlier than the others. However, there are also other countries that decided to crack down on anything involving cryptocurrency.

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That being said, one of the focal points that should be taken into consideration when analyzing the nascent industry is that adoption in this region is mainly driven from the top down. Government agencies and traditional banks, though historically known as the slowest technology adopters, are the main players diving right into crypto transformation.

The region boasts some of the wealthiest nations in the world, with GDP per capita, ranges from $50,000 to $130,000 in the Gulf states, thanks to large reserves of oil and other lucrative natural resources. However, the spending on the digital economy and its share of Arab countries GDPs is a mere low single-digit. Conventional sectors, such as real estate and stocks, are still monopolizing private investments, spending, and conversations.

So it could be a bit frustrating for crypto enthusiasts to watch the slow pace at which Arab investors are reacting to the crypto phenomenon.

But with such a hype surrounding cryptocurrencies, the virtual asset class may have enticed retail investors, with many utilizing cryptocurrency as a speculative asset to take advantage of price fluctuations.

All in all, the innovation and private investments in the crypto space have been and will remain lagging far behind other regions, including emerging nations, as in fact, they are nowhere. However, regulators, caught up with the much-hyped vision of crypto, have likewise others begun to investigate blockchain and cryptocurrency technology. And while they are expected to continue to push ahead with regulations, this may ultimately wake up the wealthy investors base to the opportunities that the new business offers.

Various countries in the Arab world have emerged as early adopters, and theyre poised to become even more influential in the near future.

Currently, at the frontier of Fintech adoption, Saudi Arabia and the UAE have announced plans to launch a digital currency to serve both countries. Dubbed Aber, it was announced in November on an experimental basis to facilitate financial settlements between the two Middle Eastern nations, which have a combined economy of over $1.2 trillion.

A Global Year in Review: KVB PRIME Expands into Key International MarketsGo to article >>

The government of Dubai has also revealed details of its own digital currency, called emCash, which will be used to pay for government and private services in the city.

Ripple, a US-based crypto payments company, is already working with Saudi and Emeriti banks to legitimize cryptocurrencies further. It has inked partnerships with Saudi Arabias de facto central bank to pilot instant cross-border payments. According to Ripple, more than fifty financial institutions in the Middle East revealed their interest in its solutions that enablecross-border money transactionsin a faster and cheaper way than the current systems allow.

Regardless of the regulatory stance, policymakers in the Middle East are aware that the adoption of the cryptocurrencies appears inevitable. Those going bigger on this track are wary of the combination of the potential benefits and risks, as well as factors that determine policy openness or aversion.

The UAE has already taken steps to regulate the way that blockchain start-ups are raising money initial coin offerings though the nations regulators continue to warn of the many risks involved. The watchdog proposed a fit-for-purpose regulatory framework that effectively recognizesdigital tokens as securities.

Under the guidelines, startups wishing to execute anICOmust approach the SCA to see if it falls under the bodys regulation. Also, market intermediaries and secondary market operators dealing with ICOs must be approved by the regulator. ICO operatorswill have to publish a prospectus, just like a firm would for an IPO on the stock market. And if an ICO has the characteristics of a security, such as giving a person ownership of shares in a company, then the SCA will regulate it.

In addition, Abu Dhabis financial regulator granted approval for Arabian Bourse, which allows the startup to operate a full-fledged crypto-asset exchange and digital custodian in the emirate.

Bahrain is also establishing itself as a blockchain pioneer in the region. Indeed, the smallest Middle Eastern nation isnt too far behind with its numerous initiatives to attract cryptocurrency business. On the one hand, Bahrain Central Bank has approved the crypto-asset exchange Rain Crypto Exchange to go live, post their partnership with global exchange Bittrex. Rain received its node after a two-year regulatory sandbox process under the central banks supervision.

Other countries like Saudi Arabia, Egypt, and Kuwait are also said to have taken notice.Their regulators have drafted different bills allowing central banks to issue rules regulating cryptocurrency activities and blockchain-based finance. The new rules reflect a U-turn from last years crackdown that said that cryptocurrencies are an entirely non-sharia compliant business.

Meanwhile, there has been a lot of debate on the use ofvirtual coins as a legitimate formof currency and investment as Islamic law emphasizes real economic activity based on physical assets and without pure monetary speculation.

All economic activity in Islamic finance must be compliant with Sharia law, which has stringent rules to ensure certainty and immediacy of transactions. Islamic law also prohibits the acceptance of interest or fees for loans of money.

See the rest here:
Cryptocurrency in Arab World: Clock is Ticking, But Pace is Slow - Finance Magnates

Nikolai Mushegian, a computer scientist who specified some of the core mechanics behind the blockchain financial services platform MakerDAO has decided to give 10,000 in MKR, currently worth just over $4.2 million, to his alma mater, Carnegie Mellon, Pennsylvania.

He wants to set up a research program for decentralized apps (dapps), protocols, and game-theoretic mechanisms to fight an industry that has been corrupted by rent-seeking behavior.

In days gone by, Mushegian wrote, research in the web3 space [was]done by players who automatically put their work into the public domain without a second thought...Nobody wanted to deal with lawyers, everyone wanted to build stuff.

He added, There was no threat from the established networks of banks and tech giants because they did not take us seriously.

Is the arrival of big banks into blockchain bad for the industry? Image: Shutterstock.

But this has changed. Major banks like Santander are using blockchain technology. JP Morgan has even created its own digital currency. It is clear that era has passed, he wrote. Some of the patents being filed make a mockery of IP law and are an insult to the developers that built the underlying technologies that enable them. Get ready for a years-long multimillion-dollar battle over whether send crypto over email is patentable.

Mushegian wrote that the fund sponsors graduate and post-graduate students at the university. Carnegie Mellons specialty, wrote Mushegian, is in designing algorithms; critical to the development of the blockchain industry.

In a post on his website, Mushegian wrote that he donated 3,200 MKR ($1,363,584) on New Years Eve, and has informally committed another 6,800 MKR, which hell give to the university in the next one to three years.

Be the first to get Decrypt Members. A new type of account built on blockchain.

Mushegian cites good karma as his motivation, as well as the increasing rent-seeking behavior from some of the big players in this space, and also from existing banks and tech giants.

By creating the fund, Mushegian hopes to fight off rent-seekers and those who are better at filing patents than writing working code. Hes banking on the fact that universities are not easily bullied by corporations, and so are less motivated by bottom lines. But will his donation be enough to battle the will of the banks and their well-funded warchests?

Read more:
Why this scientist is donating $4.2 million in cryptocurrency - Decrypt

South Korea officials are reportedly causing some confusion with the latest drafted legislation that will tax individual crypto profits. According to Cointelegraph, South Koreas officials stated that under current law, the government cannot impose income taxes on individual profits that are from cryptocurrency transactions.

South Koreas previous Ministry of Strategy and Finance confirmed it will levy taxes on virtual assets through a tax code revision bill, but at a later date. The officials further declared:

In the case of a corporations virtual currency transaction, all transactions that increase the entitys net assets are subject to taxation under the current law, so it is taxable, but it is practically impossible to produce tax revenue results by distinguishing only virtual currency transactions.

The officials also noted that they are preparing measures to impose taxes on virtual currencies by reviewing cases of taxation by major countries, which is consistent with accounting standards, as well as trends, in international discussions of money laundering prevention.

Although the South Korean government it is holding off on imposing taxation on earnings from digital asset trading, legislation is in the works.reportedly does plan to create a bill that will address taxable cryptocurrency transactions by the first half of 2020.

The plans for crypto transaction taxes come just after the National Tax Service (NTS) of South Korea confirmed that it will be withholding taxes worth an estimated 80.3 billion Korean won (appr. $70 million) from digital asset trading platform, Bithumb. As previously reported, Bithumb Holdings largest shareholder, Vidente, which operates Bithumbs Korea division, confirmed the withheld amount and noted that the tax would be imposed on the exchanges overseas clients. The companysstated:

Bithumb Korea is planning to take legal action against the tax claim so the final payment can be adjusted in the future.

The amount of tax to be withheld was determined by taking into account miscellaneous income, meaning irregular revenue sources such as lottery gain

Continued here:
South Korea Officials Cause Confusion With Drafting Legislation to Tax Individual Cryptocurrency Profit - Crowdfund Insider

When someone in the mainstream media berates Bitcoin, it often becomes an emotional alarm call for the cryptocurrency news squadron.

Suddenly, all the failed novelists who occupy cryptocurrency news desks spring into action, spewing forth endlessly optimistic and hopeful refutations. With all the sassy pride of Hillary Swanks Freedom Writers, their optimism, while hollow, manages to reassure those on the inside.

But what if one of those outsider mainstream folk we love to demonize so much happened to be right?

Recently in the pages of Yahoo Finance, Chief Economist for Lending Tree, Tendayi Kapfidze called Bitcoin a pyramid scheme.

According to Kapfidze, Bitcoin is a solution in search of a problem, and the only way to get rich off it is to dupe others who come in after you. Kapfidze said:

Its a pyramid scheme, you only make money based on people who enter after you. It has no real utility in the world. Theyve been trying to create a utility for it for ten years now. Its a solution in search of a problem and it still hasnt found a problem to solve.

How can Bitcoin be a pyramid? Didnt you see how it pumped all the way through 2017? It achieved X,XXX% gains in one year! It obviously has utility, right?

Lets be serious: everyone knows why the cryptocurrency market pumped in 2017, and its not because everyone started using Bitcoin. Nor is it because the mythical institutions rode in on horseback to save everyone with their fat fiat injections.

The (small group of) people who pumped the market in 2017 are the same people who sat back and profited from its drop in 2018.

But before you settle on those market pumpers as your enemy of convenience, ask yourself wouldnt you do the same?

Arent you too attempting to buy low, so that you can later sell high? Even the founders of major cryptocurrency projects offloaded hundreds of millions worth of their coins onto naive investors during January 2018s peak.

Bitcoins vocal proponents often fall back on the following argument: Bitcoin, unlike fiat, cant be manipulated by fractional reserve bankers to help fund illegal wars.

But cryptocurrency holders apparently dont see how much they have in common with the bankers and money-lenders.

Bitcoiners scramble to buy their assets early, with the single, sole intention of selling them later for a profit. As landowners, the name of the game is to dump on later generations who are obliged to pay more simply because they arrived later.

Money-lenders accrue money early, then farm it out for profit. Cryptocurrency holders who sell at the top often buy their coins back when the price inevitably dumps again. Thus they keep their coins and the profit.

Back to the Yahoo article, even the pro-crypto voice who was brought in to offer a counter-argument appeared skeptical. Bruderman Asset Management Chief Market Strategist Oliver Pursche compared investing in cryptocurrency to a lottery:

I own five if Im lucky one of them will become an all-star. Pursche added: You go into it very soberly understanding that you can lose all of your principle and that this is purely speculative.

How high will the pyramid grow before people realize the bags theyve been holding are actually limestone and granite blocks?

This article was edited by Samburaj Das.

Read the rest here:
Bitcoin, a Pyramid Scheme? Pick Up Those Blocks and Ill Tell You - CCN.com

Following the celebration of the new year/2020s, Coinbases Co-Founder and CEO, Brian Armstrong, revealed his thoughts about cryptocurrencys progress over the past decade. He observed the following:

Its easy to forget, but throughout much of the decade, it was a frequently debated question about whether Bitcoin would even survive. Maybe a flaw would be found in the protocol, maybe it would be outlawed, or maybe it would all go to zero since it had no intrinsic value (of course, we crypto folks were quick to point out that the dollar isnt backed by anything either). There were over 379 articleswritten, prematurely declaring the end of Bitcoin. Not only did Bitcoin survive, it thrived, becoming thetop performing asset of the decade. The naysayers were proved wrong and we learned an important lesson about human nature: most big breakthroughs are contrarian ideas that people dismiss and ridicule at the start.

When I was thinking about starting Coinbase, a few people told me I was crazy to try creating a custodial crypto wallet and exchange. The best hackers in the world were trying to break into crypto exchanges, and MtGox along with many others had suffered breaches. Through a combination of luck and skill, Coinbase managed to weather the barrage of attacks, and created many novel methods of key storage which improved with every passing year. We made cryptocurrency easier to use in the process and introduced tens of millions of new people to this new technology. This allowed us to build a cash flow positive company with 800 employees, weather the ups and downs of the crypto markets, and continue to invest in new products to help the ecosystem grow.

For a new industry, there was a lot of infighting as protocol changes were debated and new coins were launched (via fork, or entirely new projects). Many groups became radicalized and splintered off into their own echo chamber. I believe what made this more vitriolic than other technology debates Ive seen (emacs vs vim, iOS vs Android, etc) is that once people own a particular coin they have an inherent conflict of interest and emotions take over. We stop trying to seek the truth and start talking our own book. On the plus side, having a number of competing groups drove a lot of innovation vs having a monoculture or a one coin monopoly. The race is still very much on to see which blockchains will reach the next 100M or 1B users, and I would expect cryptocurrency to eventually see some consolidation, following a similar path to other industries.

The industry went through a period of five bubbles, followed each time by a crash (settling at a higher point than the previous low). In other words, the industry kept growing in an upward channel, but it was a very bumpy ride. This meant that a lot of the discussion and media attention was on the price of crypto, and the day trading attracted short term thinking that bordered at times on gambling. At the same time, investors who took a long term approach saw incredible returns.

We saw how much latent demand there was for startups to raise money from unaccredited investors when the Initial Coin Offering boom kicked off. All the previous crowd-funding records were obliterated, and now 8 out of the top 10 largest crowdfunding projects of all time are crypto-related. The ICO trend attracted the ire and attention of the SEC, who slowly but surely started making enforcement actions in the space. A debate raged on about which crypto tokens were securities, and which werent. Organizations like theCryptoRatingCouncil (CRC) came out, with industry participation, to start to provide clarity. Finally, as often happens with startups that raise too much money, it can actually harm the company. Many ICO projects failed to ship real-world products while sitting on huge piles of cash (some of them began to resemble investment firms over time, rather than real product companies).

Perhaps with the exceptions of the protocols themselves, the best business models in the past decade in crypto tended to be exchanges and brokerages who sold shovels during the gold rush to trade this new asset class. Some crypto miners had decent outcomes as well, but the volatility of crypto prices made it very difficult for them to survive the whims of the market. A large number of high quality teams and startups entered the space in the past few years, and there is a lot of venture capital money still flowing into crypto startups (our own small fund, Coinbase Ventures, has invested in 60 crypto startups in the last few years, for instance).

One of the challenges holding crypto adoption back (in addition to scalability and usability) was volatility. While volatility is great for investors/speculators, it isnt great for people who want to use it as a medium of exchange. Bitcoin volatility has trended down over time, which is a promising long term trend, but it seems people want stable cryptocurrencies sooner. Stablecoins saw a lot of adoption in the past few years. In part, this allowed the blockchain not bitcoin mindset that is more common amongst banks and governments, to find an outlet, with everyone from JPMorgan to China announcing efforts to launch stablecoins. It also allowed questionable stablecoins like Tether to provide trading pairs on exchanges without fiat rails, and crypto backed stablecoins like Dai to see increased adoption.

Crypto started the decade with purely retail activity amongst hobbyists and early adopters, but by the end of the decade there was a clear trend of institutions starting to come on board. Not necessarily the large traditional institutions, although they all seem to have teams who are exploring it, but hundreds of smaller crypto forward institutions. A couple hundred crypto funds were created (fun fact: the big three, Paradigm, Polychain, and A16Z Crypto, were all founded by former Coinbase employees or board members).

The decade started off with cryptocurrency being totally unregulated. Coinbase was (as far as I know) the first crypto company to really take regulation seriously because we felt it would increase adoption long term. We started applying for money transmitter licenses in the U.S. starting around 2013. From there, we got an eMoney license in Europe, the Bitlicense in NY, registered as an MSB with FinCEN, and started pursuing additional licenses with other agencies. We have interactions with multiple regulators, all over the world, every week at this point, seeking to be an educational resource. At the close of this decade, I can confidently say that that cryptocurrency is a regulated industry (at least in first world countries), although it will continue to evolve rapidly.

Armstrong went on to conclude his observation with a nod towards Coinbases growth and development over the years:

Overall, being in the crypto industry was a hell of a ride in the past decade. There were a number of ups and downs, and it was a very volatile industry to manage through. Im really proud that Coinbase has stayed financially healthy during this period, growing to more than 800 employees, and has helped build the infrastructure to enable the industry to keep growing. Weve continued to focus on trust and ease of use with all of our products, believing this will help bring in the next 100M and then 1B users to cryptocurrency.

The rest is here:
Coinbases Brian Armstrong Looks Back at Cryptocurrencys Progress Over the Past Decade - Crowdfund Insider