While bitcoin and other coins arent yet considered securities, the regulators will dig into finding ... [+] out if there are instances of money laundering, pump-and-dump schemes, shady business practices, wash sales and market manipulations. This would be a complete game changer if Bidens administration goes full throttle on this matter.

President Joe Biden is planning an executive action for federal agencies to regulate cryptocurrencies, digital assets and bitcoin, as he contends this is a matter of national security. Hes striking at a time when the crypto sector, along with the stock market, is going through a tumultuous time, losing large amounts of value, as the Federal Reserve said it will start raising interest rates to cool down inflation. His sights arent only on bitcoin. Regulators will look intostablecoins and NFTs. The Biden administration will also coordinate efforts with regulators and global leaders.

Regulatory agencies, such as theSecurities and Exchange Commission (SEC),the Commodity Futures Trading Commission, Internal Revenue Service and the self-regulation Financial Industry Regulatory Authority, will likely coordinate their investigations. Theyll also review whether or not tokens should be considered and registered as securities.

Usually, when there is concern over a sector in the financial industry, the regulatory bodiesconduct extensive, invasive examinations and audits. Theyll grill executives and key players of the platforms and brokerages that offer customers to buy, sell and trade securities. Trading activities will be highly scrutinized to search for any patterns of potentially illegal or unethical behavior.

While bitcoin and other coins arent yet considered securities, the regulators will dig into finding out if there are instances of money laundering, pump-and-dump schemes, shady business practices, wash sales and market manipulations. This would be a complete game changer if Bidens administration goes full throttle on this matter.

An underlying, unspoken reason for the seemingly sudden interest by Biden may be all the money that is sloshing around in the crypto space. Bidens multitrillion-dollar infrastructure and other plans are creating a huge amount of debt for the country. The digital asset world is now too big to fail, but it's not too big to extract a lot of money from it.

If the regulators find irregularities, substantial fines and tax levies may be extracted from everyone involved in the crypto ecosystem. The United States Treasury Department is already looking into what entities will be considered a crypto broker under the infrastructure bill Congress passed last year, and the reporting of any capital gains or losses to the IRS.

Gary Gensler, the newly appointed chairman of the SEC, the premier regulator of financial services firms and Wall Street, has previously voiced his concerns over digital assets.

Gensler took office when Wall Street had gone wild. During the pandemic, young, novice investors fell in love with meme stocks and aggressively traded on Robinhood. Cryptocurrencies became all the rage and a number of digital asset exchanges and platforms emerged to service the overwhelming demand for buying, selling and trading bitcoin, dogecoin, ethereum and other cryptocurrencies.

There was a boom in underwriting IPOs and SPACs. Questions arose over Chinese stocks listed and traded on U.S. exchanges and the practice of payment for order flow. Investors complained of activities that suspiciously looked like pump-and-dump schemes and attempts at market manipulations.

Gensler shared his concern with CNBC, stating about the regulatory agency, We are short-staffed. He added, It might sound odd to say that [about] an agency with 4,400 remarkable, dedicated staff working remotely during this challenging pandemic. But thats 4% to 5% less than we had just five years ago.

The lack of staffing and proliferation of new types of firms and products shouldnt be too surprising to industry insiders. In the aftermath of the financial crisis, compliance and regulations were made a top priority. The carnage created during this period created the need for greater oversight of the securities markets, bankers, brokers and traders.

Regulators cracked down on money laundering, insider trading, Ponzi schemes and other types of abusive and violative practices. The need for risk, audit, legal, compliance, privacy, regulatory and related professionals was insatiable. Compliance went from a sleepy back-office type of job into one of the hottest and fastest growing professions on Wall Street.

Things quickly changed when President Donald Trump took office. His administration made deregulation of the financial markets and Corporate America a top priority. Trump contended that with fewer rules and regulations, the animal spirits of companies will kick into gear. Companies, unencumbered by onerous regulatory burdens, would be set free to aggressively pursue bold business pursuits. Along with high taxes, regulations were viewed by Trump as an anathema to corporate growth and profits. He ordered that new rules will not be needed and existing ones should be scrutinized and thrown out, as he famously proclaimed, For every new rule, two must be revoked.

Regulatory budgets were cut and regulatory personnel felt that they weren't appreciated or adequately supported. Many left to pursue other opportunities. Savvy Wall Street players noticed the shift in policy and weve now seen the results.

The SEC and other financial regulators, such as the Office of the Comptroller of the Currency, Consumer Financial Protection Bureau, Commodity Futures Trading Commission, Federal Reserve Bank and FINRA, a self-regulatory organization, are likely to request and receive funding from President Joe Bidens administration, especially as Senators Elizabeth Warren and Bernie Sanders have been outspoken with their dislike and distrust of Wall Street.

It's reasonable to believe that there will be an aggressive hiring campaign at the SEC and other regulatory agencies. Strict examinations, audits and reviews of the securities and cryptocurrency industries will occur. To keep the banks and financial institutions safe and out of the crosshairs of the regulatory bodies, there may be a substantial increase in hiring of compliance, risk, audit, legal and regulatory professionals.

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President Joe Biden Is Going After Bitcoin, Other Cryptocurrencies And NFTs - Forbes

Bitcoin has roughly halved in value from its $69,000 peak in November to sit at around $35,000 as January draws to a close.

This precipitous fall for the original crypto and many others is nothing out of the ordinary for the most volatile of asset classes, but it has still shaken confidence amongst investors and there are plenty of people proclaiming it is the start of a long bear market .

This is far from a unanimous view though, with some experts seeing recent market movements as just the inevitable short-term period of profit-taking that follows a strong run up in prices. After all, bitcoin is still up almost 1,000% over the last three years, despite the slide from November's all-time high.

Something else to be mindful of is that crypto has begun trading with a much closer correlation to tech stocks than in the past, and therefore is being impacted by interest rate rise expectations.

Prices have stabilized over the past week and determining whether the dip is bottoming out or if there's another big fall coming is the key question all crypto investors are wrestling with.

One of the world's biggest crypto exchanges, Kraken, has a team of analysts dedicated to finding answers to questions such as this.

In a research note from the Kraken Intelligence team dubbed "On-chain digest" the analysts described the status of the crypto market as "hodlers' last chance."

"Market participants contend that the latest market weakness stems from increased concerns of hawkish policy from the Federal Reserve ," the Kraken team said. "Though prices have been falling since November, the drop didn't accelerate until the release of the Federal Open Market Committee (FOMC) meeting minutes on December 14 to December 15, 2021."

The meeting contained hints that an accelerated pace of tapering, interest rate hikes, and potential quantitative tightening to lighten the central bank's balance sheet was coming. While the Fed's hawkish tone has some convinced that a bear market may be ahead, it's crucial to observe on-chain data to paint a complete picture of the crypto markets and where they are heading."

There are four major on-chain data points the team is watching like a hawk.

These reflect the percentage of bitcoin's circulating supply that hasn't moved wallets over a specific timeframe.

When plotted against bitcoin's price it shows which market participants long-term, medium-term, or short-term holders may be fuelling selling pressure. There are three main categories. "Ancient or lost coins" that haven't moved for over five years, "old coins' that haven't moved for over 6 months and "young coins" which has only been static for 6 months or less.

"BTC's HODL waves show that long-term holders have been accumulating coins since April 2021 and may have begun taking profits during November 2021," the Kraken team said.

"From April 30, 2021, to November 24, 2021, young coins rapidly shifted into the long-term holdings category. While long-term holding conviction appears stronger than ever, network activity shows that both Bitcoin and Ethereum are seeing less on-chain demand," they added.

This refers to the number of people active on a blockchain and is measured by the numbers of bitcoin or ether addresses that are actively transacting on the blockchain.

"In addition to a reduction in long-term holding behavior, on-chain data shows that network activity for both Bitcoin and Ethereum fell month-over-month, evidenced by the drop in monthly active addresses," Kraken's team said. "Since early November 2021, Bitcoin's number of monthly active on-chain addresses has fallen meaningfully, ending a 3-month uptrend."

The SOPR is the spent output profit ratio. The SOPR measures whether market participants are selling at a profit or loss. It is calculated by taking a spent output and dividing its realized dollar value by its dollar value at creation.

MVRV is ether's market value to realized value. The MVRV Z-Score compares the difference between a cryptoasset's market cap and its realized value relative to the standard deviation of its market cap.

"While long-term holding conviction and network activity are slowing, on-chain indicators such as BTC's SOPR and ETH's MVRV Z-score suggest that the broader macro trend isn't necessarily over yet," Kraken's team said.

"Though BTC's SOPR shows that market participants are mainly selling at a loss, the situation was much worse during bitcoin's latest retracement from $65,000 to $30,000 from May 2021 to July 2021 after which the market made a strong comeback."

"The crypto market is currently going through another test amidst broader macroeconomic uncertainty relating to global interest rate policy and repricing of risk-on assets," added Thomas Perfumo, Kraken's head of business operations and strategy.

"More than ever, this market environment highlights the importance of on-chain fundamentals, which is the focus of our report. In particular, we highlight signals that indicate investor sentiment in crypto markets is greater than when markets briefly turned over eight months ago. Long-term confidence in the prospects of both assets has not disappeared as some might argue."

Original post:
Bitcoin Bear Market or Bull Run? Experts Reveal 4 Key Things to Watch - Business Insider

What happened

The cryptocurrency market is getting hit with more sell-offs today. Most top-100 tokens have seen valuation slides, and Bitcoin (CRYPTO:BTC), Ethereum's (CRYPTO:ETH) ether token, and Dogecoin (CRYPTO:DOGE) were down roughly 0.8%, 2.9%, and 2.5%, respectively, over the last 24-hour period as of 5 p.m. ET Thursday.

Rising bearish pressures are gripping the market, and investors have generally become more risk averse lately. Federal Reserve Chairman Jerome Powell made comments yesterday indicating the central bank will raise interest rates soon, and it looks like the increase may be one of many. Uncertainty continues to shape valuations in the crypto space.

Image source: Getty Images.

While many top tokens are backed by decentralized ownership and governance structures, it's clear that the cryptocurrency market does not exist in a valuation vacuum. Amid the backdrop of aggressive stimulus spending initiatives and basement-level interest rates, valuations for cryptocurrencies made big gains over the last few years. However, the market is getting hit with volatile sell-offs on the heels of some recent shifts.

Yesterday's comments from Powell point to an interest rate hike in the next couple months and additional increases later in the year. Rising rates and reduced stimulus initiatives signal a less favorable backdrop for high-risk growth investments, and the shift arrives at a time when regulatory pressures could also be increasing.

The Biden administration is reportedly eying an executive order introducing new regulations on cryptocurrencies that could be rolled out as early as February, and China, India, and Russia are among other countries signaling tougher stances on digital tokens. If that's not enough negative valuation catalysts for you, the crypto market has also been impacted by underwhelming performance updates from growth-dependent companies including Peloton, Netflix, and Tesla.

Even after recent sell-offs, Bitcoin, Ethereum, and Dogecoin have all managed to post substantial gains over the last year of trading.

Bitcoin Price data by YCharts

However, the gains also exist in the context of some dramatic volatility. Looking at the market's two most valuable cryptocurrencies, Bitcoin now trades down roughly 48% from its high, while Ethereum's ether token is down 51.5% from its peak.

The valuation gulf for Dogecoin is even more staggering. The popular dog-themed token is up an incredible 1,830% over the last year of trading, but it's also down a staggering 81% from the high it hit last May.

While the macroeconomic backdrop is shifting, top cryptocurrencies have been feeling the squeeze lately, and pressures could continue in the near term. The cryptocurrency market has been highly volatile across its relatively short history, and investors will have to weigh the potential for explosive returns against the possibility that a more pronounced bearish cycle could push token valuations lower.

This article represents the opinion of the writer, who may disagree with the official recommendation position of a Motley Fool premium advisory service. Were motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.

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Why Bitcoin, Ethereum, and Dogecoin Are Falling Today - The Motley Fool

Three months ago the crypto economy was worth more than $3 trillion and since then, digital currency prices have slid a great deal in value, as crypto assets have been sold and distributed across many hands. Over the last decade, fluctuating price cycles have made it so some addresses, typically referred to as crypto whales, have been able to accumulate vast quantities of coins. Moreover, a few crypto projects have also seen whales accumulate a majority of a tokens circulating supply via the initial distribution process.

The subject of whales is a popular one in the world of cryptocurrencies, as the entities have always been a force to be reckoned with. Whales are large crypto asset holders who own more tokens than the average person, and they are called whales because their giant holdings can move markets, much like whales in the ocean that can shake up boats and cause massive waves.

After more than a decade of people launching thousands of alternative crypto assets, years of digital currency trading, and the ever-changing price cycles, whale concentrations have changed over the years. The following is a look at the current concentration of large holders and crypto whales throughout the crypto economys top digital assets by market valuation. The concentration of large holders list and its onchain data derive from coincarp.com and intotheblock.com statistics.

The leading crypto asset bitcoin (BTC) is the oldest digital currency in the world based on blockchain technology, and it is assumed that BTC had a very fair distribution process. It is also assumed that Satoshi Nakamoto may own around 750,000 to 1 million BTC, which sit in addresses holding unspent block rewards. This means Satoshis stash is spread out and the inventors concentration of ownership is not easy to find. Intotheblock.com metrics shows BTCs concentration of large holders today is 10%.

Intotheblock.com leverages the total holdings of whales (addresses that own more than 1% of the circulating supply) and Investors (addresses that own between 0.1% and 1% of the circulating supply). Coincarp.com data on January 28, 2022, indicates that the top ten bitcoin addresses hold 5.30% of the current BTC supply in circulation. The top 20 largest BTC holders own 7.26% of the supply, and the top 50 bitcoin addresses own 10.78%. Onchain metrics further indicate that there are 40,301,661 bitcoin holders today.

Ethereum metrics are different as Intotheblock.com stats show concentration by large holders is 42%, which is much higher than BTCs concentration of whales. Coincarp.com data shows that theres 185,912,265 ethereum holders and ETHs top ten addresses hold 23.39% of the current supply. The top 20 ether holders possess 27.06% of the supply and the top 50 own 33.02%. Regarding the top 100 wallet addresses by ether balance, these hold 39.58% of the current ETH supply.

Binance coins (BNB) concentration of large holders data is not available on Intotheblock.com. Coincarp.com metrics, however, indicate that the top ten BNB addresses possess 88.23% of the supply. Onchain stats further show there are 321,134 BNB holders today. The top three BNB addresses are operated by Binances exchange platform, as the richest BNB holder is an exchange wallet with 52.02% of the BNB supply. The second-richest BNB wallet operated by Binance holds 27.14%, while 3.55% of the supply is also held by the third-largest address owned by the trading platform. BNB metrics indicate that more than 82% of the BNB supply is held by Binance operated wallets.

According to stats, there are 325,604 cardano (ADA) holders on January 28, 2022. Intotheblock.com metrics show that ADAs concentration by large holders data today is 17%. Data shows that the top 10 addresses hold 4.36% of the ADA supply, while the top 20 own 5.86% of the supply. The number one richest ADA wallet currently possesses 1.37% of the ADA supply. 100 ADA holders hold 16.76% of the 34,186,794,009 ADA in circulation today.

While XRPs Intotheblock.com metrics are null, Coincarp.com data shows that the top ten holders own 78.02% of the XRP supply. The top five XRP wallets are operated by exchanges, as the richest wallet operated by Binance holds 26.91% of the XRP supply. The top 20 XRP wallets hold 80.93% of the supply, and the top 100 addresses currently possess 85.99% of the XRP in circulation today, which is currently around 47,736,918,345 tokens.

Statistics show that theres a current supply of 314,967,774 SOL in circulation. The top ten addresses hold 10.11% of the SOL supply today, while the largest holder owns 1.58% of the SOL in circulation. The top 20 SOL wallets possess 15.77%, the top 50 hold 26.82%, and the top 100 solana (SOL) wallets hold 34.64% of all the SOL in existence. The number of wallets that hold a fraction of SOL or more today is 8,383,421 holders.

Data shows that the top eight coins by market valuation today have different concentrations of large holders known as whales. Stablecoins also have a concentration of large holders and the top ten tether (USDT) ERC20 wallets hold 26.79% of the current supply. The top ten usd coin (USDC) wallets currently hold 36.22% of the supply. 10.64% of the USDC supply is held by Maker dao while Binance holds 5.62% of all the ERC20-based tethers.

Digital currency proponents dont like large concentrations of whale holders as they could dump their coins on the market to make people panic sell. It is well known that at times large holders of any financial asset can collude and dump hoards of assets on the open market to make the price drop lower. While initially scaring the market, in the end whales make off after a dump because they simply buy back when the panic selling drops prices lower. Traditionally, because of the concentration of large holder levels and illiquid markets, crypto whales grow much larger after bear market cycles.

What do you think about the top eight coins and the concentration of large holders? Let us know what you think about this subject in the comments section below.

Jamie Redman is the News Lead at Bitcoin.com News and a financial tech journalist living in Florida. Redman has been an active member of the cryptocurrency community since 2011. He has a passion for Bitcoin, open-source code, and decentralized applications. Since September 2015, Redman has written more than 5,000 articles for Bitcoin.com News about the disruptive protocols emerging today.

Image Credits: Shutterstock, Pixabay, Wiki Commons

Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.

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Whale Watch: A Deep Dive Into the Concentrations of Large Crypto Holders Featured Bitcoin News - Bitcoin News

Perhaps a few years ago when cryptocurrencies weren't regulated and were going under the IRS' radar, Bitcoin had a better appeal to people. Those who mine this cryptocurrency now know that they definitely have to file taxes of every earned Bitcoin they get. If you are a miner who just started in the cryptocurrency world, you should start getting ready for tax season and take prep seriously. Otherwise, the Internal Revenue Service might be out to get you if you ignore your responsibilities. Reporting taxes on any crypto you earn throughout the year is already an obligation and nobody is an exception to this. Perhaps they didn't care before but so much income influx due to crypto was eventually going to have an impact and make a statement.

In recent years, the IRS has been putting their people to work on the best approach towards cryptocurrency. People who aren't ready to file their taxes who are miners should beware of the ramifications this entails. If they don't want to lose both money and time reconciling their tax liability, they need to get on that as soon as possible before tax season begins in 2022. What we are doing here is offering you a specific guide on what exactly you need to report to the IRS in regards to your cryptocurrency earnings. We'll give you the details on which crypto activity is reportable, how the IRS taxes it and how you can be ready for it.

First of all, you need to know that the IRS is treating cryptocurrencies as property, this means they will be taxed in similar fashion as stocks get taxed. If for example, you only purcased crypto with U.S. dollars and those assets have only been sitting there in your wallet, there's no need to report anything in 2022. However, you will get taxed by the IRS if you trade one cryptocurrency for another. If you sell crypto for fiat dollars (givernment-issued cryptocurrency). Or also if you use crypto to buy goods or services such as paying for coffee with your own crypto.

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Tax season 2022: Do I have to report my bitcoin profits when filing my taxes? - Marca English

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HIVE Blockchain Technologies Ltd. (HIVE) is a profitable company to trade when investors understand the simple elements associated with the movement of its share price.

While we'll primarily look at HIVE as a proxy for Bitcoin (BTC-USD), we'll also look at Hut 8 Mining Corp. (HUT) and Marathon Digital Holdings (MARA) in order to contrast companies trading at different price points.

The reason I'm doing that is to confirm and reinforce the fact that they move in unison with the price movement of Bitcoin no matter what the share prices of the companies are.

Another reason is to show readers that no matter how the companies break down their businesses, and no matter how financial writers and analysts point out differences between the companies, the reality is, none of that matters at this stage of Bitcoin's acceptance and growth.

As I'll prove to you, there is only one thing that matters when considering these companies, and that is the price and price movement of the flagship crypto.

It can seem daunting at times to trade HIVE and similar companies because of the noise related to Bitcoin and the companies with exposure to it. A lot of this comes from commentary on social media and other media outlets concerning the why behind Bitcoin price movements, the seemingly endless amount of price ranges offered technical analysis on both sides of the play, and the differences between the companies pointed out in a way that suggests that is what is driving the performance of the companies.

The good news is all of that can safely be brushed aside. There is only one thing any investor in Bitcoin proxy companies need to consider, and that is the price movement of Bitcoin; nothing else is relevant.

Something else to take into account is Ethereum (ETH-USD). Some of these companies have significant exposure to the second-largest cryptocurrency by market cap, yet there is no reason to watch that either; it will only distract from watching Bitcoin.

The reason I mention this is obvious: the price of Bitcoin and Ethereum almost always move in unison with one another. For that reason, watching both of them is pointless. Some time back the effort was made to suggest Ethereum, and Bitcoin were decoupling, but that never played out like suggested. Again, things like that are only distractions.

Some will object to this by asserting the fundamentals of these companies are drivers of their performances as well. That's easy to disprove. Look below at the Bitcoin chart and compare it with the share price movement of HIVE, Hut 8 Mining Corp. and Marathon Digital Holdings. You'll find that the market's bid is always in unison with the price movement of Bitcoin.

I'm going on about this because it's important to understand the simplicity of investing in these types of companies. We need to discipline ourselves to ignore everything else but the price of Bitcoin.

Long into the future when price discovery for Bitcoin is known, these things could change. That time is not now.

Forget about any catalyst for these companies except the price movement of Bitcoin.

Three-month chart Bitcoin

Trading View

Three-month chart HIVE

Trading View

Three-month chart HUT

Trading View

Three-month chart MARA

Trading View

When investors think in terms of Bitcoin, the impression, because of its volatility, is that it's a very unsafe investment. That couldn't be further from the truth.

After all, what other market sector can almost guarantee that its price will regain its upward momentum after big crashes, and do it in a relatively short time? That doesn't mean there isn't any risk. The risk comes from those that take a position after much hype about the soaring price of Bitcoin, buying near the top and having to painfully watch as they're caught holding the bag.

Even those getting in near the highs will, I think, eventually generate a profit if they HODL. What they do lose is access to capital they could have deployed in other profitable companies, along with valuable time as they wait for the price of Bitcoin to jump past their entry point.

For example, if HIVE was bought when it was trading above $5.00 per share, it'll take time for the company to get back to that point and surpass it. While there's no doubt in my mind it'll go far beyond $5.00 per share, the question is how long it'll take to do so. That's the same with MARA and HUT as well.

The general difference is that companies trading at higher prices tend to rise quicker than a company like HIVE which trades at a lower share price.

Interestingly to me, there is never a safer time to trade proxy Bitcoin companies than during a correction. Even if there is a bounce off what is perceived to be a low that doesn't hold, it's only a matter of time before it bounces back.

That's one thing to consider when trading these companies. The volatility of Bitcoin makes it difficult to know if the entry point is coming off a real bottom, or there is more room to fall. That's why being patient is crucial to success under these conditions.

Why I say it's very safe once there is a significant correction is because I think the price of Bitcoin is nowhere close to reaching a top. If traders get in and the price goes against them, they can wait until it continues its upward move. Contrary to holding Bitcoin on its own, I think investors should think differently concerning holding over the long term with proxy companies. The reason why is Bitcoin will continue to go through significant corrections and taking profits off the table and redeploying capital allows for many opportunities to generate profits.

Set-and-forget is good for Bitcoin, but I think taking profits and keeping some dry powder available for the next correction offers better opportunity for larger gains.

The thesis of this article is companies that are proxies of Bitcoin aren't subject to the fundamentals other companies are, as it relates to the impact on their share price.

Even so, there are several things to take into consideration. They include CapEx, cash on hand, and access to capital. Investors need to know these companies can keep the doors open in case of a prolonged period of depressed Bitcoin prices. Most companies aren't in danger because Bitcoin doesn't stay down long. Nonetheless, it's important to beware of a company's balance sheet when considering taking a position in them. With that in mind, we'll look at the strategies that are best to use under the volatile economic conditions we're now under.

The first decision to make is whether or not to take a position in the first place. At times the best action to take is to sit on our cash until we're sure of the direction the market is taking.

As mentioned earlier, that's not as easy with the highly volatile and rapidly moving Bitcoin, when compared with most other asset classes. Bitcoin can drop a couple of thousand dollars, take a temporary breather, and then resume its downward trajectory.

For example, look at a three-month chart of Bitcoin and see how it can move in either direction by many thousands of dollars, even as it continues to slide. The chart may not look much different than other charts, but even some of what appear to be smaller moves can be $3,000 or more.

What that does is make it difficult to identify whether or not Bitcoin has reversed direction or not. For that reason, after a significant downward move, I think it's best to use dollar-cost averaging and position sizing as the tools to mitigate risk as a position is being built.

One thing to bear in mind concerning dollar-cost averaging is it's different than most other asset classes when taking positions in these companies. The major difference is the timeframe usually contracts with HIVE and similar companies. What may take months, a year, or even longer when using dollar-cost averaging for a typical company, can many times be completed in one day, a week. or possibly a little longer.

Looking back on the price movement of Bitcoin over the last several years, it is rare for it to consolidate for longer than three months. One exception was an approximate four-month period from the end of 2018 through March 2019.

Under those circumstances, Bitcoin was close to a bottom, so all an investor could do was to wait for the cryptocurrency to resume its upward trajectory. Because of the volatility of Bitcoin, I prefer not to look for an absolute bottom and wait for an upward price movement to confirm it before taking a position, like most of us would do with regular stocks. Again, the quick and wide movement of Bitcoin's price doesn't lend itself well to this strategy. This is why position sizing is important when dollar-cost averaging.

I've been building a position in HIVE using this technique. What I did was determine the largest amount of capital I'm willing to spend, and based upon the price movement of HIVE, have been adding to my position to lower my cost basis while increasing my share count.

With the negative catalysts and sentiment now part of the psychology of the market, I'm not quite as aggressive as I would have been under more favorable conditions. Consequently, there have been a couple of times I could have gotten a real nice price for HIVE, but I thought it could drop much further, so didn't take the opportunity. That was a mistake of omission on my part.

The reason I kicked myself for it was because I should have known better. After all, if you're dollar-cost averaging and position sizing, the whole point is to jump on the price when it drops below the recent entry points. If it drops further after adding to your position incrementally, it provides another opportunity to lower your cost basis.

While focusing on HIVE here, the same methods can be used for MARA, HUT, and other companies whose share price moves in conjunction with Bitcoin.

The key to success is to wait long enough for the price of Bitcoin to fall far enough to provide a measure of safety. As I mentioned earlier, I don't see much in the way of risk concerning the price of Bitcoin over the long term, but if we get too excited and enter too quickly, it can tie up our capital for a longer period of time than we wish, and it also decreases the amount of potential profits of the holding.

This is why once I see a significant downward move in price, I will wait a bit to see if it holds, and if it does, I take an anchor position I can work from. Under the current correction concerning the price of Bitcoin, I took a smaller initial position in order to give myself room to significantly lower my cost basis if the price of Bitcoin continues to fall in a meaningful manner.

One psychological element to consider is this: If we take a smaller position and the price of Bitcoin starts an upward run, we won't generate near the profits we would if we had taken a larger position. That's a tradeoff I'm willing to make.

HIVE and similar Bitcoin proxy companies offer an extraordinary opportunity in a tough market. Because of that potential, we need to remain disciplined in deploying our capital, being willing to take a smaller gain if it requires in order to maintain a margin of safety.

I see little, if any risk, in regard to the price of Bitcoin going forward. I think it will eventually reverse direction and head toward another record high. While I don't think it's going to be long before that happens, it should be understood that there have been times after a correction when Bitcoin took as much as several months to resume its upward move. We can't allow ourselves to be scared out of our holdings and leave a lot of profits on the table.

We do have to be aware of the risk-off trade we now face, and the fear associated with it. This is why I'm investing a lot more defensively in this sector than I normally do.

The bottom line is there is nothing else to do than watch the price movement of Bitcoin and take our opportunities to build our positions in these companies, remembering to watch the balance sheets in case they're close to becoming insolvent.

I'm not concerned at this time about the three companies mentioned in this article, but there are a lot of companies out there that could struggle immensely if the price of Bitcoin remains down for a prolonged period of time.

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Successfully Trading HIVE Blockchain And Other Bitcoin Proxy Stocks - Seeking Alpha

Gold has historically been the best hedge against inflation. But there is a new kid on the block. As a nascent asset, Bitcoin (CRYPTO:BTC) has been around for 13 years and has already demonstrated consistent staying power and positive price movement. Having started at an approximate price of $0.003 in 2010, it has risen more than 13 million percent to around $37,000 per bitcoin at the time of writing.

But the price of bitcoin is not what makes it a better inflation hedge than gold. It is Bitcoin's adherence to a finite supply of 21 million coins. Similarly, a limited supply has long been surmised as a dominant reason for gold's status as the world's store of value, but I argue that Bitcoin has something more to offer.

Image Source: Getty Images.

The supply of gold is not truly finite. At least not in practical terms. Imagine the day wherein we travel to other planets and mine for metals and minerals. We may discover a gold mine within an asteroid, and at that point, the relative scarcity of gold could completely be destroyed. Gold is only scarce because of our current spatial and technical limitations.

Also, if the price of gold were to shoot up overnight due to market forces, it would become profitable to mine more of the gold that is already beneath our feet. Gold miners would add more supply to the market and drive the price back down to levels where it is not as profitable to mine more gold.

Despite bitcoin's name of "digital gold" their supply and inflation are nothing alike. Bitcoin has a finite supply of 21 million coins that can never be changed. Unlike gold, no amount of technical innovation or space exploration can increase (or decrease) the supply of bitcoin. Price fluctuations will not result in miners bringing more or less bitcoin into circulation.

Instead, the supply of new bitcoin coming into circulation is decided by an algorithm which is enforced by the miners running the network. This means that the supply of new bitcoin is detached from movements in price.

The supply of bitcoin is not regulated by any one individual, entity, or organization. It is regulated by an algorithm that began in 2009, and will end sometime around the year 2140 when the last bitcoin is mined. The algorithm is actually relatively simple to understand.

Here's what you need to know: a single bitcoin block is mined approximately every 10 minutes, and the computer that mines the block earns a reward, which is some amount of bitcoin. In 2009, that reward was 50 bitcoin per block (which meant 50 new bitcoins were brought into circulation roughly every 10 minutes). For every 210,000 blocks mined (roughly every four years), that reward is cut by 50%. The block reward became 25 in 2012, 12.5 in 2016, and 6.25 in 2020. This effectively means that the inflation rate of bitcoin is slowing down and will eventually reach zero.

In 2022, the inflation rate of bitcoin is below 2% and decreasing with each passing block. This is below the target inflation for the USD, and below the average inflation rate of the supply of gold (13% in 2021). The inflation rate of bitcoin doesn't depend on the price of bitcoin (like gold) or central bank or government policy (like the USD). The only thing that the inflation rate depends on with bitcoin is the blocks being produced.

Bitcoin's inflation rate predictably and reliably decreases over time, giving investors like me a high degree of certainty that there will be fewer new bitcoins coming into circulation as the years go by. Today, more than 90% of all bitcoin (18.9 million) is already in circulation with the remaining 10% (2.1 million) set to be mined over the course of the next 120 years. After all of the bitcoin has been mined, the miners that maintain the security of the network will have to derive their paycheck entirely from fees paid on transactions.

At the end of the day, I'm trusting that the bitcoin supply schedule will remain on track and undisrupted. The only thing that could disrupt it is a globally catastrophic event such as a devastating solar storm or asteroid impact. Otherwise, the bitcoin network and its supply schedule is as resilient as the internet itself. The supply schedule of bitcoin is based purely on math, whereas gold and the USD are based on humans and the decisions they make. I have a much easier time trusting that the computers running the math will continue to do as they are told. It is bitcoin's strict limited supply that makes it a superior inflation hedge than gold against the ever increasing supply of the USD.

This article represents the opinion of the writer, who may disagree with the official recommendation position of a Motley Fool premium advisory service. Were motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.

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Why Bitcoin Is the Best Inflation Hedge Against the USD -- and Gold - Motley Fool

Young peoplewere already feeling depressed about their future retirement prospects, according to polls.

Still more following the collapse of all their cryptocurrency bets, one suspects.

More than $1 trillion has been wiped off the notional value of cryptocurrencies suchas Bitcoin, Ethereum and the like in just a few months according to a Washington Post report, citing data from industry website CoinMarketCap.com.

Its 10 months since HBO talk show host BillMahercalled the crypto boom a joke and Easter Bunny cartoon cash, and urged his viewers to get out. Prices went up for a while before coming back down. Bottom line: Bitcoin is now a third lower than it was when Maher took the air, and Dogecoin, another cryptocurrency he highlighted, has fallen by more than half.

The losses fall heaviest on millennials, those in their 20s and 30s, because they are the most likely to own cryptocurrencies. According to a recent poll, about 31% of those aged 18 to 29 have used or bought a cryptocurrency, compared to just 8% of those aged 50 to 64.

The losses may also be felt more heavily among people of color, if a University of Chicago poll is to be believed. It found that 44% of cryptocurrency traders were from ethnic groups other than Caucasians, and 41% were women. Cryptocurrencies are opening up investing opportunities for more diverse investors, which is a very good thing, said UCs Angela Fontes in July.

Millennials were already worrying about their retirement prospects even before the crypto rout.

Last July, 72% of them told the National Institute for Retirement Security that they were concerned they wouldnt be able to achieve a financially secure retirement. Two-thirds said they were more anxious about their retirement prospects in the wake of the Covid crisis.

Millennials are supposed to face tougher prospects for retirement due to a confluence of factors, especially high student debt. However they are likely to benefit if the aftermath of the Covid crisis includes higher wages.

The latest slump in cryptocurrencies is nothing new. Their prices have soared and crashed repeatedly since they were first invented over a decade ago.

Fans can accurately say that all these currencies in total still sport a total notional value of $1.7 trillion, meaning that owners of cryptocurrencies have collectively created that amount of money out of nothing. Bitcoins price is still more than 6 times what it was 5 years ago.

But whether that wealth could be converted into genuine or fiat moneycashis another matter.

Incidentally, claims that cryptocurrencies are a havendigital gold, as some saidthat can diversify or stabilize a portfolio have suffered something of a setback since the start of the year. While the S&P 500 SPY, +2.48% stock index has fallen 7% and the U.S. bond index AGG, +0.07% 2%, Bitcoin BTCUSD, -0.31% has, er, fallen 26%.

Meanwhile gold GLD, -0.30% has risen 1%.

The standard argument in financial planning is that those who are young, in their 20s and 30s, can most afford to lose money onspeculationand investments because they have the most time to recover. But the argument is flawed. Money lost on investments in your youth is arguably more costly than money lost later, not less costly.

Thats because when youre young your investment dollars are much scarcer. And because its the money you invest when youre young that really has time to grow into something big.

A single dollar invested at 30 and earning, say, 5% a year will grow to $5.50 by the time youre 65.

Invested at age 50, it will grow to only $2 and change.

(A real investment return of 5% a year, meaning 5% above inflation, has been a long-term average from the stock market.)

What happens if the cryptocurrencies dont recover? Likely answer: Finger-pointing, lawsuits, and largely pointless extra regulations.

As reported in the Washington Post article,

The crypto crash has put pressure on Washington regulators to impose stricter rules on the industry and raised fresh questions about the dangers of cryptocurrency for the average investor.

Youre going to get more people calling their elected representatives, generally unhappy about crypto or feeling they were wronged in some way, said Ian Katz, managing director of Capital Alpha Partners, a Washington policy analysis firm. All regulators and members of Congress want to appear to be alert behind the wheel, and if this turns out to be a continued bloodbath, it increases the impetus for action.

Among the ironies: One of the things crypto fans like about these currencies is their alleged freedom from the political and legal system.

Incidentally, it was much the same after the dot-com crash. Back then Washington ended up passing the Sarbanes-Oxley regulations, to protect ordinary people from financial fraud and the ruthless, rampaging capitalism they loved when they thought they were making money. I notice that these regulations didnt seem to stop Bernie Madoff from continuing his fraud for years, and did nothing to stop the subprime bubble and subsequent financial collapse. On the other hand, from my direct experience I can report that the regulations were really, really good at discouraging analysts, economists and other financial experts from talking to the press.

As for crypto? Any young person whos lost money should look at how much and multiply the figure by about 5. Thats how much the losses have taken out of their future retirement funds.

Excerpt from:
'Easter Bunny cartoon cash' how Bill Maher called the Bitcoin crash - MarketWatch

A new bill introduced in the U.S. has a provision that would essentially give the Treasury Secretary unchecked and unilateral power to ban cryptocurrency transactions, warned crypto advocacy organization Coin Center. Treasury Secretary Janet Yellen will be able to prohibit any crypto transactions without any process, rulemaking, or limitation on the duration of the prohibition.

Jerry Brito, executive director of Coin Center, a D.C.-based think tank focused on the public policy issues facing cryptocurrencies, warned about the America COMPETES Act of 2022 in a series of tweets Wednesday. The bill was introduced in the House of Representatives on Tuesday.

Noting that the America COMPETES Act of 2022 will very likely pass in some form, Brito explained that it contains the special measures provision proposed by Connecticut Congressman Jim Himes that would be disastrous not just for cryptocurrency but for privacy and due process generally. He continued:

The so-called special measures provision would essentially give the Treasury Secretary unchecked and unilateral power to ban exchanges and other financial institutions from engaging in cryptocurrency transactions.

Currently, the law requires that Treasury engage in a public rulemaking before instituting a prohibition, Brito said, adding that the secretary can impose a surveillance special measure through a simple order, but its duration is limited to 120 days and must be accompanied by a public rulemaking.

The Coin Center executive outlined that the new provision would do three things.

Firstly, it would Add certain transmittal of funds to the list of things that can be banned by the Secretary. Secondly, it would Eliminate all public notice and comment requirements. Moreover, it would Eliminate the 120-day limitation for measures imposed without regulation.

He warned that If adopted into law, this provision would be disaster not just for crypto but for privacy and democratic public process related to *all* types of financial transactions, elaborating:

It empowers the Secretary to prohibit any (or indeed all) cryptocurrency transactions (or any other kind of transaction) without any process, rulemaking, or limitation on the duration of the prohibition.

What do you think about the America COMPETES Act of 2022? Let us know in the comments section below.

A student of Austrian Economics, Kevin found Bitcoin in 2011 and has been an evangelist ever since. His interests lie in Bitcoin security, open-source systems, network effects and the intersection between economics and cryptography.

Image Credits: Shutterstock, Pixabay, Wiki Commons

Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.

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US Unveils Bill Giving Treasury Secretary 'Unchecked and Unilateral Power' to Ban Crypto Transactions, Advocate Warns Regulation Bitcoin News -...

LOS ANGELES, Dec. 24, 2021 (GLOBE NEWSWIRE) -- .Paak House co-founder, and founder of Global Management Group, Carrie Lyn hosts United Friends of Children Foster Youth in 8th Annual Holiday High Tea and gifts cryptocurrency for each of them.

This Holiday High Tea is organized to raise more well-rounded, self-aware, accountable, young women that break barriers for our Future World, while giving them an experience and access to support that they may not ever have had before.

Saturday, December 18, 2021, at The Getty, Los Angeles

Each of the Girls were VIP GUESTS, rising to the occasion, presenting answers to their 6 questions provided prior to the event. This year's theme of questions was based on Mental health awareness, coming out of quarantine and financial literacy as it pertains to cryptocurrency and NFTs.

Many of the girls did not know anyone else there, and yet were able to bond and share hardships and things they found to be helpful to "get through" challenging times. This was a safe space to be vulnerable and learn from each other's experiences.

The Girls knew nothing of Cryptocurrency, but Lyn was able to give them examples that lit their eyes up with understanding. The girls were gifted cryptocurrency assets that will be doubled after completion of a 1-year cryptocurrency and NFT educational program she is providing for them.

Topping off the event, each of them were gifted an amazing ALO Yoga bag full of goodies and were able to explore the Getty.

Notable Sponsors Included: The Cynthia Foundation, Xyion, Let's Give, Alo Yoga, 8AM, VeeFriends/Gary Vee and more.

"My mission in life is to create an impact that will last longer than my life on Earth." - Carrie Lyn

Lyn first tapped in with United Friends of Children for her .Paak House Beyond the Streets initiative that focused on the reality that "Your circumstances do NOT determine your OUTCOME." With that, she saw even more so the need and value that she could provide to the youth.

It's impressive with how hands-on Lyn is, regardless of the growth of these impactful events. We will be looking out for what's to come in 2022!

To get involved email Carrie@globalmgmtg.com.

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Los Angeles Foster Teens Are Gifted Cryptocurrency and 1