Daily Archives: May 11, 2022

Cryptocurrency has moved into the mainstream as an investment asset class. If you're looking to add some to your portfolio, it may be difficult to figure out how to get started. Crypto is currently unregulated, and investing in it can feel more Wild West than Wall Street.

Read on to learn the basics of cryptocurrency and how to get started investing in it.

Cryptocurrency is a type of digital currency that doesn't rely on a central authority to verify transactions or create new units. Instead, it relies on cryptography to prevent counterfeiting.

Blockchain technology supports cryptocurrency. A blockchain consists of individual blocks of data that can contain information about anything, such as transactions made in a specific cryptocurrency. Each block of data makes a reference to the previous block, creating a chain of blocks. The reference uses cryptography to ensure the chain remains immutable so hackers are unable to change data.

There are thousands of cryptocurrencies in existence right now. That's largely due to the ease of creating a new currency by using smart contracts. New coins can simply piggyback on an existing blockchain that already has a well-established network of computers verifying blocks.

Before you go ahead and buy some coins or tokens just because somebody says it's a good investment, it will pay to do some research.

First of all, it's important to understand that picking a good cryptocurrency is not like picking a good stock. A stock represents ownership in a company that creates profits for its shareholders, or at least has the potential to do so. Owning a cryptocurrency represents ownership in a digital asset with zero intrinsic value.

What makes a cryptocurrency increase or decrease in price is simple supply and demand. If there's increased demand and a limited supply increase, the price goes up. If supply becomes constrained, price goes up, and vice versa. So, when evaluating a cryptocurrency, the most important questions to answer are how the supply increases, and what will drive demand for the coin higher.

You can answer those questions by reading the white paper that a cryptocurrency team publishes to attract interest in their project. Look at the roadmap for a project and see if anything could spark an increase in demand. Research the team behind a project and see if they have the skills to execute their vision. Try to find a community of people already investing in the cryptocurrency and gauge their sentiment.

It's also important to consider how much money has already flowed into a cryptocurrency. If the market cap is already very high, there may not be much potential growth left. A high price will curb demand and increase supply as early investors look to take money off the table.

Image source: Getty Images.

Once you've found a cryptocurrency you think will make a good investment, it's time to start buying.

The first step is to open an account with a cryptocurrency exchange. Most stock brokers don't support trading in cryptocurrency. Coinbase (NASDAQ:COIN) is one of the most popular and beginner-friendly exchanges in the U.S. Other options include Gemini, and newer brokers such as Robinhood (NASDAQ:HOOD) and SoFi (NASDAQ:SOFI) support crypto. Just be sure the exchange you want to use also supports the cryptocurrency you want to buy.

Once you've funded your account with fiat currency, you can make an order to buy your cryptocurrency. Orders on an exchange work the same way as orders in the stock market. The exchange will match your buy order with someone making a sell order at the same price and make the trade.

Once your trade is complete, the exchange will hold your cryptocurrency for you in a custodial wallet.

Buying cryptocurrency is the easy part. As a crypto investor, you have to be prepared for volatility. Crypto, in general, is more volatile than traditional asset classes such as stocks. Price swings of 10% or more in just a few hours are very common.

Additionally, you should consider how much of your portfolio you ultimately want to allocate to a specific cryptocurrency and to the asset class in general. With the volatility of crypto, be sure to give yourself wide bands of acceptable allocations. If your investments fall out of those bands, be sure to rebalance.

Investing in cryptocurrency has a few advantages:

But there are some big disadvantages for investors as well:

As a beginning cryptocurrency investor, you shouldn't try to find a diamond in the rough. You should get your feet wet with more established cryptocurrencies that have built-out networks to support them. That will allow you to get more familiar with the mechanics of cryptocurrency investing, as well as how it fits into your portfolio.

Bitcoin (CRYPTO:BTC) is an easy place to start. Every cryptocurrency exchange will support trading in Bitcoin. It's well-established, and you know what you're getting with Bitcoin. It's nothing fancy, just digital cash, but it has a first-mover advantage that had made it widely adopted. That gives Bitcoin a competitive advantage when it comes to being actually usable as a medium of exchange.

Ether (CRYPTO:ETH) is also a good choice for beginner investors. Ethereum's technology is behind most DeFi projects, which use the Ethereum blockchain to execute smart contracts and provide financial services without a central authority. Anytime a user wants to write a smart contract to the blockchain, they'll have to pay Ether to do so. Increased adoption of DeFi applications will lead to greater demand for Ether.

A third option for beginner investors is Cardano (CRYPTO:ADA). Cardano offers an alternative to Ethereum that's designed to be more energy efficient by using a proof-of-stake system to verify blocks on the blockchain. As such, it currently has much lower transaction fees than Ethereum. Additionally, Cardano has a hard cap on the total supply of the token similar to Bitcoin. That means the supply could become constrained in the future, which will drive the price higher.

Investing in crypto requires you to do your research and be confident enough in your investment to hang on during what's sure to be a wild ride. If you can do that, the payoff could be worth it as the expected returns are higher than most other asset classes.

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How to Invest in Cryptocurrency | The Motley Fool

Representations of virtual cryptocurrencies are seen in this illustration taken November 28, 2021. REUTERS/Dado Ruvic/Illustration/Files

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WASHINGTON, May 11 (Reuters) - On Tuesday, bitcoin fell briefly below $30,000 for the first time in 10 months, while cryptocurrencies overall have lost nearly $800 billion in market value in the past month, according to data site CoinMarketCap, as investors fret about tightening monetary policy.

Compared with the Fed's last tightening cycle which began in 2016 crypto is a much bigger market, raising concerns about its interconnectivity with the rest of the financial system.

In November, the most popular cryptocurrency, bitcoin, hit an all-time high of more than $68,000, pushing the value of the crypto market to $3 trillion, according to CoinGecko. That figure was $1.51 trillion on Tuesday.

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Bitcoin accounts for nearly $600 billion of that value, followed by ethereum, with a $285 billion market cap.

Although cryptocurrencies have enjoyed explosive growth, the market is still relatively small.

The U.S. equity markets, for example, are worth $49 trillion while the Securities Industry and Financial Markets Association has pegged the outstanding value of U.S. fixed income markets at $52.9 trillion as of the end of 2021.

Cryptocurrency started out as a retail phenomenon, but institutional interest from exchanges, companies, banks, hedge funds and mutual funds is growing fast.

While data on the proportion of retail versus institutional investors in the crypto market is hard to come by, Coinbase, the world's largest cryptocurrency exchange, said institutional and retail investors each accounted for about 50% of the assets on its platform in the fourth quarter.

Its institutional clients traded $1.14 trillion in crypto in 2021, up from just $120 billion in 2020, Coinbase said.

Most of the bitcoin and ethereum in circulation is held by a select few. An October report from the National Bureau of Economic Research (NBER) found that 10,000 bitcoin investors, both individuals and entities, control about one-third of the bitcoin market, and 1,000 investors own approximately 3 million bitcoin tokens.

Approximately 14% of Americans were invested in digital assets as of 2021, according to University of Chicago research.

While the overall crypto market is relatively small, the U.S. Federal Reserve, Treasury Department and the international Financial Stability Board have flagged stablecoins - digital tokens pegged to the value of traditional assets - as a potential threat to financial stability.

Stablecoins are mostly used to facilitate trading in other digital assets. They are backed by assets that can lose value or become illiquid in times of market stress, while the rules and disclosures surrounding those assets and investors' redemption rights are murky.

That could make stablecoins susceptible to a loss of investor confidence, particularly in times of market stress, regulators have said. read more

That happened on Monday, when TerraUSD, a major stablecoin, broke its 1:1 peg to the dollar and fell as low as $0.67, according to CoinGecko. That move partly contributed to bitcoin's fall. read more

Although TerraUSD maintains its tie to the dollar through an algorithm, investor runs on stablecoins that maintain reserves in assets like cash or commercial paper could spill over into the traditional financial system, causing stress in those underlying asset classes, say regulators. read more

With more companies' fortunes tied to the performance of crypto assets and traditional financial institutions dabbling more in the asset class, other risks are emerging, say regulators. In March, for example, the Acting Comptroller of the Currency warned that banks could be tripped up by crypto derivatives and unhedged crypto exposures, given they are working with little historical price data.

Still, regulators overall are divided on the size of the threat a crypto crash poses to the financial system and broader economy.

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Reporting by Hannah Lang in Washington; Editing by Michelle Price and Matthew Lewis

Our Standards: The Thomson Reuters Trust Principles.

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Explainer: Does the cryptocurrency crash pose a threat to the financial system? - Reuters

Bitcoin, the world's largest cryptocurrency, has fallen over 50% since setting an all-time high of nearly $69,000 in November.

Dan Kitwood | Getty Images

The two main tokens from embattled crypto project Terra went into free fall Wednesday.

TerraUSD, or UST, plunged to as low as 26 cents. The so-called stablecoin is meant to maintain a 1-to-1 peg with the U.S. dollar. It was last trading at around 46 cents, according to Coin Metrics data.

Sister token luna at one point dived to less than 90 cents before recovering slightly to $2.14. The coin has lost roughly 96% of its value in the past seven days, and now has a smaller market value than its stablecoin counterpart.

Blue-chip tokens bitcoin and ether saw wild swings throughout the day as traders monitored UST's descent as well as hotter-than-expected April inflation data. Bitcoin was last up 1% at $31,377, having previously slumped below $30,000. Ether fell 1% to $2,309.

Stablecoins are akin to bank accounts for the crypto economy, offering a sound store of value to avoid the kind of volatility cryptocurrencies like bitcoin have become notorious for in theory, at least.

UST is what's known as an "algorithmic" stablecoin. It uses a complex system of minting and burning tokens to adjust supply and stabilize prices. UST's price has crumbled under the pressure of a sell-off in cryptocurrencies recently, resulting in further panic in the market.

Do Kwon, the coin's creator, made a last-ditch effort to return UST to its $1 peg by increasing the rate at which new luna is minted per day. The venture is essentially allowing supply of its stablecoin to be eaten up, a move it hopes will boost the price.

"I understand the last 72 hours have been extremely tough on all of you - know that I am resolved to work with every one of you to weather this crisis, and we will build our way out of this," Kwon tweeted Wednesday.

Investors had hoped for a fresh capital injection to boost the project. Backers of UST are reportedly seeking to raise more than $1 billion in funding to prop up the stablecoin.

Vijay Ayyar, head of international at crypto exchange Luno, said Kwon's announcement did not inspire confidence.

"They're letting the system bleed out in the hope that it will start re-pegging back when the'excess' UST supply has been worn out," Ayyar said.

Kwon has amassed billions of dollars' worth of bitcoin through his Luna Foundation Guard fund to support UST in times of crisis. The fear now is that Luna Foundation Guard dumps those bitcoins onto the market, resulting in an even bigger sell-off.

Bitcoin briefly slumped below $30,000 Wednesday, the second time in a week it has fallen beneath that level. The world's biggest cryptocurrency is down over 50% since its November all-time high, as investors flee risky assets amid fears over rising inflation and slowing economic growth.

Algorithmic stablecoins are still a relatively new phenomenon. But UST has grown to become a major player in the crypto economy, with a circulating supply of 16 billion tokens.

David Moreno Darocas, a research analyst at CryptoCompare, said the situation highlights the "fragility" of algorithmic stablecoins like UST.

"UST has grown to be both an integral and controversial piece of the crypto ecosystem," he said.

Continued here:
Controversial stablecoin UST which is meant to be pegged to the dollar plummets below 30 cents - CNBC

The global cryptocurrency market cap increased slightly over the last 24 hours while Bitcoin (BTC) also showed some signs of recovery. But does it mean that the latest crypto market crash is over?

On CoinMarketCap, there has been a lot of change in the top 10 crypto ranking and market capitalisation numbers of several tokens. While Terra (Luna) is now out or even top 20 cryptos, Dogecoin is back at 10th rank in terms of market capitalisation. Interestingly, cryptos like BNB, Ethereum and XRP have shown higher rate of recovery as compared to Bitcoin in the last 24 hours.

Experts think that crypto markets appear to be recovering from the recent crash but the atmosphere of extreme fear continues in crypto community.

Even as Bitcoins price stabilised around the $30,000 level, data from Glassnode suggested that there was a spike in BTC transfer volume to exchanges. This implies that many traders were moving their BTC to exchanges to sell. Similar to how BTCs correlation to the S&P 500 restricted the assets recovery, ETHs correlation to BTC led to the altcoin trading closely with BTC, Darshan Bathija, CEO and Co-Founder of Vauld, told FE Online.

ALSO READ | Top 10 crypto prices today

Compared to Bitcoin, some altcoins like MATIC posted gains, suggesting that traders still showed a greater risk appetite. Having said that, the overall crypto market sentiment was still at the levels that implied extreme fear, he added.

Prices of most of the altcoins have increased, outperforming BTC in the past 24 hours.Bitcoin showed some minor signs of recovery on Wednesday.

BTCs support at US$30,000 could keep the short-term buyers active, while resistance holds at US$35,000. The second-largest cryptocurrency, Ethereum, also rose by nearly 3% after dropping below US$2,300 for the first time since January. The UST also returned to US$0.90 as the LFGs bitcoin reserves outweighed its worn-out supply on exchanges. The market seems to have started to recover a bit from the recent downward trend, Edul Patel, CEO and Co-founder, Mudrex, said.

Next support for BTC at $28,600?

After a significant correction that led to Bitcoin plummeting below the $30,000, BTC appeared to have recovered back to edge above the $31K level as the market sentiment of fear cooled-off a bit, WazirX Trade Desk said in a note.

However, Bitcoin still remains in the oversold zone.

On the daily time-frame, the trend for BTC is on the verge of breaking below the long formed triangle pattern. The trend could bounce back from this support level. If, however, the chart breaks below the pattern, then the next support for BTC can be expected at $28,600. The daily RSI for Bitcoin recovered back marginally but still remains at an oversold zone., the note said.

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Crypto crash over? Is cryptocurrency market recovering? Heres what experts say - The Financial Express

London, UK, May 10, 2022 (GLOBE NEWSWIRE) -- Over the past few years, Blockchain technology has evolved significantly, and now it is time to see businesses implement it. Six ambitious entrepreneurs launched Vigor Loop with the mission to bring to the world the most innovative company introducing and implementing the Blockchain system. With them, the business of tomorrow has arrived and we may be entering a new era of commerce.

Introducing Vigor Loop and the $OVO Coin as the ideal business model of nowadays which breaks all the established standards. Vigor Loop is the first company with unlimited ownership giving investors the possibility to own and manage a part of it by purchasing $OVO Coins. Those investors would constantly receive passive income from the profits made by the company after selling its products.

Vigor Loop began its commercialisation in May, with over 20 products available including their unique Energy Drink among other clothing and GYM Accessories.

The Vigor Loop Original Energy Drink was carefully designed to improve and maintain a healthy lifestyle as it contains botanical extracts, vitamins and nootropics, while excluding the harmful ingredients found in many other beverages.

Along with this key product, the team works hard to expand and diversify their commercial branches to reach huge quantities of customers by creating new products without losing sight of their values.

As part of their ambitious roadmap, they claim and prove that they are developing other concepts for deployment in the last quarters of this year. A mobile App is under development and will bring to its users features including: free workout programs, eLearning platform and a personalized space for their investors where users will be able to control their investments, monitor finances, trade and stake the $OVO Coins. This App will be released in the summer while their first NFT collection will start minting.

By that time they will be settled for their biggest deployment of 2022, the VL Smart Recycling Box. This concept will play an important role in sustainability, as it will allow everyone to easily recycle containers of beverages while being rewarded. Through the use of the VL Smart Boxes, users will receive rewards via the mobile App and indistinguishably the material of the container recycled, they will receive $0.07/container allowing them to directly donate it or exchange it for $OVO Coins.

Being the exclusive token within the Vigor Loop ecosystem along with BNB, the $OVO Coin is built for maximum efficiency and utility. Its main purpose is to symbolize the shares of the corporation. It can also be traded like any other crypto coin, however the Vigor Loop team highly recommends every investor to stake their $OVO Coins in order to receive attractive monthly income.

One of the Vigor Loop CO-Founders, Dylan Sanz Garcia, announced that the company has been successfully settled after achieving all rights and approvals required. This led his team to publish the day of the $OVO Coin Launch on 18th of May. Furthermore, the presale and fundraising for the project will start on the 15th of May from 12:00 PM (GMT), taking place on the Pinksale platform. All kinds of traders and investors regardless their location or financial status are welcomed to partake.

Links:

Linktree: https://linktr.ee/vigorloop

Website: https://vigorloop.com/

Twitter: https://twitter.com/VigorLoop

Instagram:https://www.instagram.com/vigorloop/

Discord: https://discord.com/invite/SXJ7s3sM

Telegram:https://t.me/VigorLoop

TikTok: https://www.tiktok.com/@vigorloop?lang=en

Whitepaper: https://vigor-loop.gitbook.io/vigor-loop-whitepaper-v1.0/

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Reality goes beyond fiction. This cryptocurrency can change the future of businesses - GlobeNewswire

Acryptocurrency or crypto is a digital currency that circulates without a central authority like a bank or a financial institution.

Unstable economic environments fomented the creation of cryptos.

Cryptos were made to protect you from economic crises or unfair governments that can take away your resources.

"Cryptocurrency is one of those categories of investing that doesn't have those traditional investor protections," said Gerri Walsh, senior vice president of Investor Education at the Financial Industry Regulatory Authority.

"They're outside the realm of securities trading. It's an area that's in flux, as far as regulations go."

Sensationalism generates expectations. Knowing that a crypto investor became rich generates interest among people.

Nevertheless, many people entered the cryptocurrency market with blind knowledge of the matter.

Investing in crypto has the same effect as exchanging coins.

You need to buy cryptocurrency to start your investment. However, do it from verified platforms.

-Coinbase

-Binance

-FTX

Even Venmo, PayPal, and Cash App will let you buy and sell cryptocurrency, but with limited functionality.

Cryptocurrencies are volatile. Prices go up and down dramatically. Investors should have an emergency fund to cover unexpected costs before investing in assets.

It is crucial to have money for emergencies before buying any cryptocurrency.

Without an emergency fund, you could be forced to sell all your assets with a loss margin.

"Investment professionals suggest that investors keep their exposure low -- even for those who are all-in on the technology," says Marcos Cabello.

"Anjali Jariwala, a certified financial planner and founder of Fit Advisors, recommends that clients allocate no more than 3% of their portfolio into crypto."

There are a ton of options in the cryptocurrency market. However, you need to understand how cryptos fit your other investments.

Diversifying is a good idea, but investing everything in risky (most volatile than usual) assets is not the safest idea.

It may be worth putting some of your money into safer bets.

Develop a strategy for cryptocurrency investment based on fundamentals rather than social media discussions, or celebrity commercials.

Commit a long-term investment, don't plan to "get rich" quickly.

Blockchain data firm Chainalysis identified $14 billion of stolen crypto last year.

Fake websites are slightly different from the main domains, and they try to mimic them.

Avoid excessive marketing on a crypto asset.

For example, Kim Kardashian and Floyd Mayweather Jr. were sued in a class action legal process for inflating a coin, and then, the creators disappeared.

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Cryptocurrency: How to actually invest in crypto? - Marca English

BUFFALO, N.Y. (WIVB) Cryptocurrency is a form of investment that has made many people very rich in a very short period of time.

What is most puzzling about cryptocurrency it is currency. The U.S. dollar, that is currency, the ruble, Japanese yen, that is currency. Do you know of anyone who has bought $100,000 cash and made a fortune from it? That is almost exactly what investors are doing with Bitcoin.

The most well-known cryptocurrency right now is Bitcoin it has grown exponentially in value over the last few years, turning small time investors into millionaires almost overnight. But Paul Coleman of Level Financial Advisors says, keep in mind, it is currency digital money you are supposed to be other things of value with.

I mean, the vast majority of people that you are talking to do view the various cryptocurrencies as an investment, instead of more of an actual currency that can be used to buy and sell things, he said. As the demand for the various cryptocurrencies increases the price of them goes up.

Coleman told us, the attraction of cryptocurrency for investors is it eliminates the middle man governments that issue and control the value of their currencies. Value for Bitcoin and other digital currencies, theoretically, is how much millions of investors are willing to pay for it.

Cryptocurrency is supposed to be more stable, but lately that is changing.

What is important to note is that so far it has fallen faster and more significantly than your traditional stock markets like the S&P 500, the NASDAQ or the Dow, Coleman said.

He also pointed out cryptocurrency is in many ways like cash if you lost track of it, you might as well burn it.

I believe the famous example is a gentleman who lost his bitcoin wallet in a landfill, accidentally threw it out, and offered to pay the city that owned the landfill tens of millions of dollars to sort through the landfill.

Coleman told us the man had bought his cryptocurrency when the value was very low, discarded his password to his bitcoin wallet, and when he realized his mistake, the value had ballooned to $100 million. Coleman also advised stick to investments you know.

Al Vaughters is an award-winning investigative reporter who has been part of the News 4 team since 1994. See more of his work here. To submit a Call 4 Action, click here.

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Cryptocurrency, the good news and the not-so-good news for investors - WIVB.com - News 4