In early March, the Bank of Englands governor-designate, Andrew Bailey, said that Bitcoin has no intrinsic value. He controversially stated that any investor that holds Bitcoin should be prepared to lose all of the money. Bailey said, If you want to buy it, fine, but understand it has no intrinsic value. It may have extrinsic value, but there is no intrinsic value.

Throughout the past several years, many high-profile investors and government officials such as billionaire Mark Cuban, Berkshire Hathaways Warren Buffett and United States President Donald Trump have criticized Bitcoin for its lack of real value.

In July 2019, President Trump echoed the sentiments earlier shared by Buffett and his business partner Charlie Munger when he claimed that the value of Bitcoin is based on thin air, implying that it has no intrinsic value. At the time, President Trump said:

I am not a fan of Bitcoin and other Cryptocurrencies, which are not money, and whose value is highly volatile and based on thin air.

The argument for the lack of value in Bitcoin derives from its origin: a decentralized and peer-to-peer network of miners, users, developers and node operators that has been running since 2009 without the presence of a central entity or a group that oversees the blockchain protocol.

Hence, the concept that a decentralized and completely open-source network, which in theory is software, is foreign to many investors. In 2018, Berkshire Hathaway vice chairman Charlie Munger said that Bitcoin is worthless, artificial gold, describing it as a piece of clever computer science. Munger told CNBC:

Bitcoin reminds me of Oscar Wildes definition of fox hunting: The pursuit of the uneatable by the unspeakable.

Most of the negative stances towards Bitcoin and the skepticism about its value stems from its distributed structure and the digital nature. But, cryptocurrency industry executives and prominent investment firm operators perceive the value of Bitcoin differently.

In an interview with Cointelegraph, BlockTower Capital chief investment officer Ari Paul explained that the value of Bitcoin comes from the control it gives to users that own the asset. The non-confiscatable characteristic of Bitcoin provides users with an unprecedented level of financial freedom when compared with traditional assets.

Safe haven assets like gold, for instance, which investors foresee Bitcoin would compete against over the long run, have seen many instances wherein gold held by individuals were seized by governments in the past. Paul told Cointelegraph:

BTC is many things: its value comes as the only way to pay for Bitcoin blockchain space (aka censorship resistance as a service), but Id argue far more of its value comes from its seizure resistance. If I want to store $1 of wealth in a way that can't be arbitrarily seized by governments, I need to own $1 of BTC, regardless of BTCs price per dollar. With that framing, its vaguely comparable to the offshore banking system which is roughly $30 trillion.

The argument that the value of Bitcoin comes from its seizure resistance goes in line with the sentiment of Wences Casares, the CEO of crypto custody and wallet provider Xapo. In an essay titled, The case for a small allocation to Bitcoin published in March 2019, Casares suggested that every $10 million portfolio should have at least $100,000 invested in Bitcoin with a long-term investment thesis.

Casares explained that growing up in Argentina, he saw his family lose their savings three times over, and the last time was due to unfair confiscation of assets.

Related: Crypto Traders Explain What Caused the Bitcoin Price Plunge to $3,000s

Founder of Quantum Economics Mati Greenspan told Cointelegraph that whether Bitcon has any intrinsic value purely depends on the perception of an investor of Bitcoin and the entire asset class. By definition, the term intrinsic value refers to the true, inherent and essential value of an asset, commodity or currency. But value is subjective and oftentimes changes significantly based on varying circumstances.

As an example, before President Richard Nixon essentially eliminated the gold standard by disallowing the Federal Reserve to reclaim dollars with gold, the intrinsic value of the dollar came from the backing of gold. But when the gold standard was abolished, other countries started to print money and the inflation rate of reserve currencies began to rise.

A case can be made that the intrinsic value of a reserve currency is the government or the country behind it, but the value of it can change rapidly depending on varying factors, according to Greenspan:

Intrinsic value is defined as an investors perception of the assets value, so whether Bitcoin does or does not have it depends entirely on the perspective of the prospective investor. Perhaps it holds no value for Mr. Carney at this time, but it certainly has value to millions of other people around the world.

Despite the emergence of trusted custodians and strictly regulated exchanges that have contributed to the establishment of a rapidly improving infrastructure supporting the market, Bitcoin is still an emerging asset.

Since the Dow Jones fell sharply on March 12 due to heightened levels of fear from the coronavirus pandemic, Bitcoin has shown a high level of correlation with the U.S. stock market. This tight correlation has devalued the image of Bitcoin as a safe haven asset. Prior to March 2020, BTC was never tested under an environment where the global financial market started to crash and show signs of extreme uncertainty.

Related: Bitcoin Price Correlates With Traditional Assets, but Not Entirely

The volatility of BTC and its correlation with stocks this month primarily stem from the fact that its market capitalization is still hovering at around $116 billion. That is merely 1.37% of the $8 trillion market cap of gold.

As the market cap of Bitcoin increases over time, it will show less volatility and increased levels of stability, which would allow it to be seen as a safe haven asset in times of global market slowdown. Tyler Winkelvoss, the billionaire CEO of U.S.-based crypto exchange Gemini, said recently on the matter:

Bitcoin is not a hedge to pandemics, it is a hedge to fiat regimes. A sudden, negative demand shock in the global economy will affect every asset, including gold, in the short term. The world will get through this, but at what long-term, Faustian bargain? Bitcoin is not making any deals right now. It has the resilience and endurance to last in the infinite game.

With a larger market cap, stronger infrastructure, higher liquidity, clearer regulatory frameworks and increased levels of mainstream awareness, the value proposition of Bitcoin can improve significantly over the next decade. And eventually, the argument that Bitcoin lacks intrinsic value is likely to weaken, as its non-confiscatable characteristic, decentralized nature, and fungibility will add to the assets value.

See the original post here:
Does Bitcoin Have Intrinsic Value or Is It Based on Thin Air? - Cointelegraph

Bitcoin rose sharply today, while major stock indices languished.

Bitcoin prices surged today, climbing roughly 20% as the major stock indices experienced substantially weaker gains.

The worlds most prominent digital currency rose to $6,393.76 around 1:45 p.m. EST, according to CoinDesk data.

At this point, the cryptocurrency was up 19.8% for the day, and had climbed more than 60% from its recent low of less than $3,900 reached on March 13th, additional CoinDesk figures show.

In contrast, major U.S. stock indices have not shown compelling gains today, with the S&P 500 Index and the Dow Jones Industrial Average up less than 1% since opening, Google Finance data shows.

[Ed note: Investing in cryptocoins or tokens is highly speculative and the market is largely unregulated. Anyone considering it should be prepared to lose their entire investment.]

A combination of factors are driving the market higher today, said analyst Denis Vinokourov, head of research for London-based digital asset firmBequant.

Specifically, he pointed to profit taking flow in the options market as well as some degree of stabilisation of the liquidity conditions, with the cost of liquidity continuing to come off the extreme levels observed over the recent sessions.

He also spoke to the vastly different performance of bitcoin and stocks, which had been falling together recently.

While Bitcoin may have been trading in lockstep with risk assets and in particular S&P500, it is not the first that the the digital asset has established some degree of correlation to traditional assets, said Vinokourov.

Everytime, this correlation proved to be short lived, he noted.

This deviation is another win for an asset that prides itself on its non-correlated and asymmetric performance, Vinokourov stated.

Catherine Coley, CEO of Binance.US, also weighed on the recent changes in the global asset markets.

Last weeks nosedive in crypto markets was part of a universal rush to cash among investors in response to unprecedented panic and uncertainty, but Bitcoins appeal as a safe haven and deflationary asset is once more apparent amid the raft of fiscal and monetary stimulus from governments and central banks around the world, reminding investors just how precarious the existing financial system really is, she said.

Paolo Ardoino, CTO of Bitfinex and Tether, took a different tack, describing recent events as providing validation for the entire space.

"The blockchain industry can and will survive through tremulous current events, he stated.

The current situation shows that the global economy needs transparency and blockchain, noted Ardoino.

You can not keep printing money out of thin air leaving our children to pick up the debt. Bitcoin is the answer, he stated.

Disclosure: I own some bitcoin, bitcoin cash, litecoin, ether and EOS.

Original post:
Bitcoin Rally Leaves Stocks In The Dust - Forbes

Sometimes bitcoin's price moves with the stock market, and sometimes it doesn't. (Photo by Bryan R. ... [+] Smith / AFP) (Photo by BRYAN R. SMITH/AFP via Getty Images)

[Ed note: Investing in cryptocoins or tokens is highly speculative and the market is largely unregulated. Anyone considering it should be prepared to lose their entire investment.]

As a borderless digital asset not controlled by governments or centralized companies, bitcoins price should, in theory, travel its own path, independent of other currencies and markets. Cryptos pioneer asset, however, has seen varied views suggesting correlations to traditional markets, such as stocks, safe-haven investments such as gold, or even arguments that bitcoin is not correlated to anything. Available data shows no firm answer, as bitcoins correlation seems to change with the wind, while a number of experts have varying thoughts on the matter.

I believe that bitcoin does have a correlation with traditional stock markets because they are both private assets, analyst and trader Tone Vays told me in a March 18 comment. Bitcoin benefitted a lot from the ten year bull market because people got generally wealthier, and they were more willing to speculate on something like bitcoin, Vays added, mentioning the thriving market seen over the last decade.

Vays expects a positive reaction from bitcoin during relatively uncertain economic times, such as a countrys withdrawal from the eurozone for example. People will be scared, but they still have their jobs and theyre looking for a place exit, he said, referencing people prospecting for investment opportunities.

The analyst, however, said the current situation differs. When it comes to a major situation like we have now with the markets crashing, and people worrying about their jobs, theyre not going to speculate on bitcoin, Vays said. As an asset that has only been in existence for roughly 11 years, the analyst explained bitcoin is not yet primed to take the place of cash across the globe.

Amid global coronavirus fears and oil trade wars, recent days have seen traditional markets plummet. The Dow Jones Industrial Average (DJI), a common barometer for market health, fell more than 20% from its 2020 highs by March 11, and faced continued decline in the days following. Bitcoin suffered similar carnage around the same time frame, diving from $10,500 on February 12, down to $3,870 by March 13.

Between March 12 and 13, BTC fell from $8,000 down to $3,870, while the Dow fell from 22,840 to 21,150, according to TradingView.com price charts. The Dows March 12 drop totaled over 7% which is less damage comparative to bitcoins dump, but still a severe market loss by traditional market standards.

Bitcoin Sometimes Travels Its Own Path

Bitcoins price has not always travelled in line with traditional markets, however. Based on bitcoins chart, compared to the S&P 500 index, another popular mainstream benchmark, cryptos pioneer asset has acted oppositely at times.

An article from Cointelegraph compared historical price data between 2018 and 2019 from the S&P 500 and bitcoin, showing inconclusive data for any firm trend. At times, bitcoin did not react, or acted oppositely when the S&P 500 moved sharply. During other periods, the two seemingly moved in sync.

According to Vays, bitcoins price does not follow traditional markets during times of decreased price swings, also known as low volatility, sometimes seen when markets are level or marginally trending upward. If the volatility of the stock market isnt huge, bitcoin is not correlated at all, he said. When the market is going up very quickly, or when the market is crashing, I believe there is a correlation to bitcoin because theyre both private assets.

In recent days, amid the mentioned traditional market fears and falling prices, bitcoin has held rather steady. Specifically, on March 16, the Dow suffered another red day, while bitcoin traded largely sideways, ranging between $4,450 and $5,370, rather than posting new 2020 price lows like the Dow. The asset has held strong since March 16, regardless of traditional markets, sitting at a press time price of $6,648.

Cryptos Largest Coin Stated As A Non-Correlated Asset

Morgan Creek Digital cofounder and crypto aficionado Anthony Pompliano noted bitcoins comparative action in a March 16 tweet. Bitcoin is basically flat today and the stock market is down double digits, he said.

Don't hear many people yelling about BITCOIN IS CORRELATED! today, Pompliano added. Truth is correlation doesn't matter over short periods of time. Over months and years, bitcoin remains a non-correlated asset.

Over the years, Pompliano has piped up many times, defending his stance of bitcoin as a non-correlated asset. Bitcoin is definitely a non-correlated asset, Pompliano told CNBC in a December 2018 interview. If you look at the correlation between the digital asset and the S&P 500 over the last 180 days, its at zero, he noted. If you look at it compared to the dollar index, its near zero, he added.

As of a January 2020 interview with Cointelegraph, Pompliano said his position on the matter had not changed. The most important part of bitcoin, when it comes to the global hedge, is the fact that its a non-correlated asset meaning that, as stocks go up or down, bitcoin doesnt have correlation to that, he told the media outlet.

Centralized Investor Population

Emmanuel Goh, CEO of crypto analytics company Skew, explained bitcoins price action relative to stock market investors. The top 10% wealthiest households own 84% of available U.S. stocks according to a 2016 report from the National Bureau of Economic Research (NBER). Goh told me Baby Boomers comprise most of these numbers while holding almost no bitcoin. Millennials who own bitcoin also have a small allocation to stocks, he added.

That should make, in theory, bitcoin more immune to liquidations and margin calls during a global sell-off, Goh explained. Bitcoin was still down 10% in sympathy today - a muted reaction in our view given the context for global markets and bitcoin high volatility, he said on March 9, noting a relatively small move for bitcoin given its regular tendencies.

As bitcoin continues to age, gaining further recognition with time, the asset may develop a more predictable correlation or lack of correlation to traditional markets or world events. At this point, however, cryptos pioneer asset appears to be finding its way one step at a time, changing its correlation at times.

Disclaimer: I actively trade cryptocurrencies, as well as hold a small amount of BTC, ETH, LTC, XMR, NEO, ZEC, BEAM, BCH, DASH, LINK, XTZ andvarious insignificant other altcoin positions.

Read more from the original source:
Contrary To Popular Belief, Bitcoin Isn't Consistently Correlated To Anything - Forbes

Bitcoin had been trading higher for most of the session but just recently some selling pressure has put it into negative territory. The top of the consolidation period at 5,985 could act as support but 6K looks to be doing a good job at the moment. The price is also above the 55 SMA and this indicator does also sometimes provide support.

Looking at the chart now, the MACD histogram has turned negative but the signal lines are still above the zero line which is still positive. 7K seems to have been just a step too far for the Bitcoin bulls as there was a firm rejection at that level along with a bearish candlestick formation.

The target could be 5,285 to 5,300 which is the middle of the consolidation period and could be considered the mean value area. The overall trend is also down so shorts could be in favour at the moment.

Here is the original post:
Bitcoin Price Analysis: The 6K level looks vulnerable to another downside break - FXStreet

The cryptocurrency market continues to see a lot of indecision as bulls and bears continue to wrestle over control. However, if Bitcoin breaks below $6,000 once again, the latter could score a resounding victory.

Must Read

Trader Big Cheds recently tweeted that the bulls were 'working hard'to hold the $6,000 level. The top coin is currently changing hands at $6,139 at press time.

The bears did manage to push the price lower on multiple occasions today, but they are yet to get behind the wheel.

Must Read

If the BTC price breaks below the above-mentionedonce again, it will most probably resume its downtrend, according to trader Cred. After that, he expects the orange coin to be stuck within its previous intraday range.

As reported by U.Today, BTC rocketed to nearly $7,000 on March 20, but this move was followed by a 20 percent pullback.

See more here:
Bitcoin's Difficulty on Track for Historic Drop, but There Is Silver Lining - U.Today

Well, it seems that the bears are back in town as Bitcoin drops by a total of 10% today as it penetrates back beneath the $6,000 level once again. The cryptocurrency was looking like it was on the road to recovery over the past couple of days, however, it was unable to overcome resistance at $7,170 which caused it to roll over and fall.

It is currently trading above a short term trend line but if it breaks we might see Bitcoin returning beneath $5,000 and possibly make some fresh lows for March.

BTC/USD 4HR CHART SHORT TERM

Taking a look at the 4HR chart above we can clearly see Bitcoin running into the resistance at $7,174 provided by a bearish .618 Fib Retracement. It was really unable to climb above $6,700 which caused it to roll over and drop back into previous resistance (now support) provided by a bearish .382 Fib Retracement priced at $5,911.

Bitcoin remains neutral but a break of the trend line is likely to put it bearish again.

If the sellers push beneath $5,911 and the rising trend line, the first level of support is located at $5,786 (short term .5 Fib Retracement). This is then followed by support at $5,550, $5,467 (short term .618 Fib Retracement), $5,200, and $5,000.

If the sellers continue beneath $5,000, support lies at $4,800, $4,577 (downside 1.272 Fib Extension), $4,139, and $4,000.

On the other hand, if we climb above $6,000, resistance lies at $6,174, $6,400, $6,542, $6,700, and $7,000.

Support: $5,911, $5,786, $5,600, $5,500, $5,467 $5,200, $5,000, $4,800, $4,672, $4,577, $4,139, $4,000, $3,912, $3,500, $3,436..

Resistance: $6,000, $6,174, $6,542, $6,700, $6,800, $7,000, $7,174, $7,200, $7,270, $7,500, $7,676, $8,000, $8,073, $8,250, $8,461, $8,672, $8,979, $9,000, $9,100.

Summary

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Bitcoin Price Analysis: BTC Might Drop Beneath $4,800 Again If It Breaks THIS Short Term Trend Line

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Bitcoin dropped by a total of 10% over the past 24 hours as it pushes back beneath $6,000.The cryptocurrency is currently trading above a short term trend line but if it breaks we might see Bitcoin heading beneath $4,800.

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Yaz Sheikh

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Coin Gape

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Bitcoin Price Analysis: BTC Might Drop Beneath $4,800 Again If It Breaks THIS Short Term Trend Line - Coingape

The daily confluence detector shows one strong resistance and support level at $6,375 and $5,775, respectively. The former has the 15-min Bollinger Band, one-week Fibonacci 23.6% retracement level and SMA 100, while the latter has the one-month Pivot Point support-three.

There are two healthy support levels on the downside at $130 and $119.50. The former has the one-day Fibonacci 38.2% retracement level and SMA 10, while the latter has the one-month Pivot Point support-two. On the upside, there is a strong resistance level at $133.50, which has the 15-min Previous Low, one-week Fibonacci 38.2% retracement level, 15-min Bollinger Band middle curve, SMA 5, SMA 50 and SMA 200.

Quite like Bitcoin, Ripple also has one strong resistance and support level, as per the confluence detector. Strong resistance lies at $0.1765, which has the Previous Year low. On the downside, good support lies at $0.145, which has the 4-hour and one-day Previous Lows and one-month Pivot Point support-two.

Original post:
Top 3 Coins Price Prediction: Bitcoin, Ethereum and Ripple consolidate their price following as bulls and bears wrestle for control - Confluence...

/latest/2020/03/brazilian-authorities-intervene-to-prevent-bitcoin-fraud-caught-on-tape/

Brazilian Authorities Intervene to Prevent Bitcoin Fraud Caught on Tape

brazilian-authorities-intervene-to-prevent-bitcoin-fraud-caught-on-tape

A Brazilian cryptocurrency trader documented an attempted bitcoin scam during which police intervened.

According to a series of Instagram videos published by Diego Aguiar, the scam occurred at the Iguatemi shopping mall in So Paulo, Brazil. Aguiar claimed to have been involved in a transaction with an alleged scammer, Marcelo Nego, who attempted to send him fake bitcoin.

He said,

I just took a bitcoin scam, the guy managed to hack my bitcoin wallet. He sent me a fake bitcoin, I never saw it.

Aguiar reportedlylost RS $64,000 ($12,358)from the fraudulent transaction. However, he was able to alert authorities in the aftermath of the scam and captured on video police immobilizing and detaining the perpetrator, before putting the manin handcuffs.

The cryptocurrency trader warned his followers to be careful when conducting physical bitcoin transactions,

When making a bitcoin transaction, be careful. I did it in a public place and even then the guy tried to rob me. Pay close attention to who you do business with.

Aguiar describes himself as a high-risk businessman and publishes Instagram videos documenting his travels.

Featured Image Credit: Photo via Pixabay.com

Read more here:
Brazilian Authorities Intervene to Prevent Bitcoin Fraud Caught on Tape - CryptoGlobe

What happened

Thursday has been a strong day for cryptocurrencies. As of 3 p.m. EDT, bitcoin had risen by about 14% over the past 24-hour period, and most other major cryptocurrencies also made double-digit moves to the upside.

So, it shouldn't come as too much of a surprise that Grayscale Bitcoin Trust (OTC:GBTC) is rising as well. Shares of the trust, which essentially holds a stockpile of bitcoin that back its share price, were nearly 15% higher on the day.

Image source: Getty Images.

There isn't much in the way of bitcoin- or cryptocurrency-specific news that appears to be propelling prices higher. Instead, this looks more like a relief rally, as bitcoin and most other cryptocurrencies have taken a nosedive along with the stock market as the COVID-19 coronavirus pandemic has spread across the globe. Even after today's move, bitcoin is only about 5% higher over the past week and is roughly 33% lower than it was a month ago.

Before you decide to invest in Grayscale Bitcoin Trust, it's important to point out that its shares trade at a huge premium to the value of the bitcoin owned by the trust. According to Grayscale's website, each share represents 0.00096524 bitcoins. At the current price of just over $6,100 per bitcoin, this translates to a per-share value of $5.89, about $1 less than the trust's current share price. Plus, Grayscale charges a high 2% annual management fee for maintaining the trust.

View original post here:
Here's Why Grayscale Bitcoin Trust Is Rising Today - Motley Fool