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Automatic Trading Tools Turn Out to Be Increasingly Popular Today

Deep trading bot

Now we want to to tell about one of the most popular solutions of a kind – DeepTradeBot, a unique combination of Blockchain technology, artificial intelligence and cloud computing.

Crypto trading platforms sometimes provide clients with too many instruments along with a complicated UI, and there may be 2 issues: it is too hard for a rookie to get started on using the platform effectively, but for the seasoned traders that takes a long time to spend in the system in any case.

These facts are exactly why automated trading platforms enjoy considerable attention in the todays reality.

DeepTradeBot provides traders with a possibility to use AI features that make crypto trading more efficient while one can afford spending less time for the process. The entire solution has been created to be easy to use. Let’s have a look on its functions.

DeepTradeBot AI bots trade on popular platforms

The trading robots functionality is founded on deeply machine learning and neural networks multiplied by the effectiveness of cloud computing and BigData technological innovations.

The system works jointly with Bittrex, Exmo, Kraken, Binance, Bitfinex and Huobi exchanges, and provides the chance to lease one of 4 trading bots offered:

Deep trading bot

DeepTradeBot has multiple AI robots

Each of them becomes activated at the best time, and allows to trade successfully regardless of the recent market situation.

The most principal modes are:

High frequency trading:

A bot analyses the price sensitivity on the trading platforms by their order books, that could not be monitored by visually.

To do this, the bot accumulates every alternation in the order book and evaluates the probability of price movements.

Arbitrage trading:

The simplest model, always accessible, but with a yield of just 5% to 15%.

It’s function is to provide supplementary protection when the other modes make less profit than average;

Algorithmic trading based on technical indicators;

Trading with the help of fundamental analysis.

The bot analyses the news “stuffing” through social networking sites like Facebook and twitter, etc. Thus making use of its man-made intellect capabilities DeepTradeBot definitely makes the most of the program work for a trader: it analyses numerous recognised feedbacks from traders, regulators, creators (such as criticism or support) who make a negative or positive news background by their posts.

These records in turn possess a straight effect on the rates and trading volumes. The automatic news keywords parsers allow the bots to evaluate the potential news impact from a specific source.

It’s depending on historical details about the information effect on rates and trading volumes.

Top 3 main advantages of DeepTradeBot

Increased Winrate

Usually it takes a minimum of 1 second to transmit a signal using the API which the other robots, or even a web socket used to work with. During this period, the Winrate may be lessened by 40%.

The secret to attaining a higher Winrate rating for deepTradeBot is always to obtain trading indicators from the exchange server.

Better interface

One and only thing you need is to refill your balance, get a bot, and enjoy savings on fees, have a greater money turnover, a larger Winrate, and accordingly – profits.

Lower fees

A large trading volume on exchanges opens the opportunity to acquire very low trading commission fees: the greater the trading volume is, the lower the percentage on top trading platforms.

Thus, due to margin trading and trading with big volume, the bots make profits even in cases where there’s little volatility and insignificant arbitrage opportunities in the market.

DeepTradeBot Pricing and Options

DeepTradeBot has four bots to select from, including a free one which permits new customers to test the platform for free.

It offers the next bots to rent:

  • MiniBot 5 NFS / Free Bot
  • StandartBot 10 NFS / $10 USD
  • ProBot 15 NFS / $25 USD
  • NetPremium 40 NFS / $45 USD
Deep trading bot

Each one features its own rental conditions, minimal and maximal daily revenue range, trading pairs etc.

The currencies available to use for today are BTC, ETH, LTC and DOGE.

AI Trading Advantages

A bot is not emotional

It’s not a secret that the entire world is near world-wide robotisation. Self driving automobiles, communication bots, smart houses are the today’s reality.

And when today’s robots perform rather low-qualified functions, tomorrow they may take over the processes necessitating intricate logical activities.

Using the AI trading we are at the dawn of this epoch.

Probably the most challenging job in trading is to avert being emotional, but have rather flexible thinking.

But this is quite easy for an AI bot.

Non-adaptive trade systems are suitable cause they can use the proper trading methodology whenever the conditions are correct.

Instead of being emotional and performing errors, trade robots will always enter the market at the correct moment.

A bot doesn’t get tired

It is not possible for a trader to work 24/7 without a break. It’s very hard to keep pace with the speed the crypto market develops with, every day of the week.

Trading bots are functioning in automatic mode, and never get fatigued. Thus it looks wise to get a 24/7 automatic AI-based assistant that will take care of your trading activity during the whole day and week.

The fact is a single successful deal can completely refund you the cost of the robot rent and save your time and money.

A bot is always same attentive

You have probably noticed that once the Bitcoin price increases, the cost of a definite sheetcoin may immediately drop down, as if there was a kind of rule.

Such a simple dependency can be seen with the human eye. Artificial Intelligence is also able to to discover, follow and anticipate much more deeper and even multi-level dependencies that are absolutely unnoticeable to the unaided eye.

But the main benefit of a robot is it is not just intended for this type of procedures, although the much more data it analyses, the smarter it might be.

Self-learning is the main feature of DeepTradeBot.

Is AI Trading for You?

Should you be looking for ways to improve your crypto trading results, DeepTradeBot may be worth to use.

The free of charge bot will give you a great possibility to try the service without any having extra charge.

The crypto trading instruments and activities are developing day by day. DeepTradeBot will assist you to succeed in this promising industry with very minimum expenses.

The DeepTradeBot strategies will certainly help you to enjoy earnings no matter which way the industry is trending right now.

Although the biggest edge is DeepTradeBot is working 24/7 and offers you maximum of extra time throughout the day.

A Monopoly on Crypto Payments? Worldline Buys Main Competitor Ingenico and Brings Crypto Payments to a Grocery Store Near You

Worldline Buys Main Competitor Ingenico and Brings Crypto Payments to a Grocery Store Near You

Can cryptocurrencies become embedded in the fabric of our shopping habits? As the world embraces digital payments, cryptocurrencies face a unique opportunity to revolutionize the way we transfer money. Several companies around the world are on a mission to find a perfect payment solution for the digital future, but two projects in the DACH region may be the closest to starting a financial revolution. Will they manage to write cryptocurrencies into our grocery receipts?

With the progressing digitalization of the financial sector, the way we shop constantly changes. Cash is losing importance, as mobile payments are revolutionizing the market. In fact, by 2022 mobile transactions are predicted to become the second most popular payment method, just after debit cards. Experts estimate that the total transaction value of digital payments may continue to rise with an annual growth rate fixed at 12%, reaching its all-time high of US $6,699,201 million ($6.7 trillion) by 2023.[1]

Several companies are developing a secure digital payment method, which allows people to pay with digital currencies. Ready to address the needs of the changing market and take advantage of the shift in people’s purchasing habits, they set out to create a tool, which would support effortless Bitcoin and Ethereum transactions in numerous supermarkets and shops. One major project of such kind is Ingenico’s and Salamantex’s collaboration aimed to create the software for various types of digital currency payments.

 Ingenico, an expert in providing seamless payment solutions, has been on the market for over 30 years successfully adapting to the evolving financial landscape. Salamantex, on the other hand, was founded in 2017 and has been dedicated to creating crypto-friendly fintech software ever since. Ingenico’s and Salamantex’s project is designed to encourage cryptocurrency use in everyday life by authorizing payments in Bitcoin, Ethereum, and Dash in the supermarket terminals. How does it work? You can choose to pay in a cryptocurrency as you settle your bill. After your payment’s been authorized, the transaction amount is simply converted to the sellers’ preferred currency just as it is transferred to their accounts.

The companies presented the first POS terminal at the EuroShop 2020 trade fair in Düsseldorf, Germany.  Their collaboration combines Salamantex’s digital enthusiasm and appetite for innovation with Ingenico’s vast experience and secure solutions. Over the years, Ingenico’s built a reputation of a reliable terminal producer: there are over 30 million of their terminals around the world. Integrated with Salamantex’s software, which also works as a mobile & web application and plug-in for online shops, they may start the brand-new era of digital payments, especially in the DACH region, where they mainly operate. According to Statista’s new reports, the German digital payment sector is set to generate a total transaction value of US $127,443 million ($127 billion) in 2020[2], compared to Austria’s US $15,082 million ($15 billion)[3] and Switzerland’s US $20,927 million ($20 billion).[4] These numbers are expected to gradually rise in all the mentioned countries, which is promising for Ingenico, whose terminals are approved by all major German payment network operators.

As German and Austrian companies are on their quest to revolutionize payment systems in the European Union, Switzerland is undertaking its own mission to offer a cryptocurrency payment option for Swiss merchants and customers. Worldline, the popular financial services provider, and Bitcoin Suisse, Switzerland’s largest crypto company, announced they would cooperate to enable digital transactions in cryptocurrencies in brick and mortar stores and on online stores across Switzerland. Worldline operates in 30 countries and has 85,000 payment terminals in Switzerland alone. In 2018, Worldline generated $2.2 billion in revenue from their payment services.

Bitcoin Suisse’s CEO, Dr Arthur Vayloyan, called their collaboration “a major step forward on the journey to bring crypto payments into broader adoption”, adding that “Bitcoin Suisse is proud to serve as the processor of cryptocurrencies in Worldline’s payment service system”.

So who will win the race to bring crypto payments to our local grocery store? Well, first it’s not a race anymore, because Worldline is buying Ingenico for a valuation of $8.6 billion. However, the problem with crypto payments is that cryptocurrency users do not want to spend their cryptocurrencies. They believe the price will go up further, so they only spend their monthly return from staking or lending. However, this infrastructure will be used by some, especially die-hard crypto fans.

In that sense, Switzerland’s project will most likely gain more traction initially, because Switzerland is undoubtedly one of the most crypto-friendly countries in the world. The Swiss city of Zug accepted Bitcoin as a valid payment method for public services in 2016 when public trust in cryptocurrencies was much lower. In addition, the Swiss Central Bank has an ambitious plan to launch its own pure digital currency. Although there is progress in Germany on the custody side, all countries in the European Union are still under pressure from the European Banking Association to steer clear of crypto assets.

Will cryptocurrencies win people over once they become relevant everyday payment methods? Whose project will make history and whose idea will bite the dust? Whatever awaits our digital kingdoms, one thing is sure: innovation will always find a way to redefine who we are and how we shop.

[1]See Digital Payments worldwide, Statista

[2] See FinTech: Germany, Statista

[3] See FinTech: Austria, Statista

[4] See FinTech: Switzerland, Statista

Crypto Custody Solutions

Crypto Custody Solutions

“There are a lot of investors where custodianship was the final barrier. Over the next year, the market will come to recognize that custodianship is a solved problem. This will unlock a big wave of capital.”

Kyle Samani
Hedge Fund Manager at Multicoin Capital
We want to sincerely thank Daniel Wingen and The Value of Bitcoin Conference for contributing this chapter. Daniel is a Bitcoin Researcher for The Value of Bitcoin Conference. Our readers can register online with the coupon code CRR20 for their next upcoming conference this June 2020 in Munich, Germany.

In the January 2019 edition of the Crypto Research Report, we extensively covered institutional grade cryptocurrency custody. We interviewed three firms in the space including Crypto Vault AG, Crypto Storage AG, and Coinfinity. This article explains custody from the perspective of a user, including information on how to store keys privately, and what questions to ask when considering using a storage company.

Storing Digital Assets in a Digital High Security Vault

“Custodians are necessary as the next step towards crypto-assets being seen as a safe and attractive financial asset option for large FIs and perhaps for market confidence in general… Major institutional custodians providing a secure place to store large amounts of crypto-assets could provide the protection necessary to reduce the risk of hacks and increase the trust of the investing public in crypto-assets.”  
Attorneys at Perkins Coie  

Storing your gold or other physical assets comes with two options: either at a facility you completely control in all aspects (self-custody) or at a service provider, who holds the assets in your name secured in a facility you have no access to (service custody). The same principle applies for storing your digital assets like bitcoin. However, digital assets require a digital vault to provide the highest security standards. But what exactly needs to be stored safely in case of digital assets? It is the so called “private key” which provides access and control over the digital asset and thus the right to transfer it to someone else. In the case of Bitcoin, the private key is a 256-bit number represented in hexadecimal form. Storing these keys is basically a physical issue as they could be simply written on a piece of paper or engraved in metal and put into a safe deposit box to limit physical access and digital exposure to the internet where they could potentially be accessed and copied by a hacker. As a private key is needed to sign a transaction (prove ownership), software is required to execute the signature generating process and the key needs to be revealed to this software. In order to facilitate this procedure, specific hardware wallets were introduced which enable not only a hardware secured environment for generating the necessary signatures without exposing the key to the internet, but also can handle an infinite amount of keys deriving from a master private key following a standardized process. This standardization of key derivation enables users to backup just the master private key and recover all necessary keys on a new device in case of malfunction or loss.

Using only N of M private keys makes it possible to store e.g. another key somewhere as a backup. Should one of the keys be stolen or lost, the secured Mth key can be retrieved.

The next step to attain an even higher level of security would require one to build something which could be described as a digital vault. A digital vault typically involves the creation of multiple master private keys and storage of them on special hardware wallets with secure elements at different geographic locations.

The transaction then needs to be signed by N out of M private keys depending on the spending rules implemented when originally receiving the funds. This concept is called multisig – short for “multi signature scheme”.

In order to deal with malfunction of key storage hardware, a proper backup plan is crucial. The most common practice is to either perform a so-called key rotation or to securely store encrypted backups to be able to recover the master private keys. Both methods come with advantages and drawbacks.

Figure : Example of a “Multisig-Scheme”

Example of a "Multisig-Scheme"

Source: Incrementum AG, Daniel Wingen

The execution of a key rotation becomes necessary if one decides that the master private key should never leave the secure element of the hardware wallet, which makes backups impossible. This is great for reducing attack vectors as long no device malfunctions, but if there is an incident, all funds need to be moved to a setup of completely new generated master private keys. Moving millions or even billions worth in digital assets is a very critical and expensive endeavor which takes time and introduces a lot of attack vectors if not planned and executed accurately. Backing up the master private keys on the other side also opens a new attack vector for collusion or social engineering to extract the private keys.

Figure: Two Major Ways of Protecting Against Hardware Malfunctions

Two major ways of protection against hardware-malfuntions

Source: Incrementum AG, Daniel Wingen

A key rotation scheme means that you have to replace the entire set of keys. This is because if you lose one of three and you need two out of three keys to sign a transaction, you have to act quickly. The coins need to be moved to a new address where you again own all three keys, because if one additional key would be lost, all the coins are lost forever.
Social engineering can be described as a psychological strategy in which attempts are made to gain access to digital safes through targeted manipulation. Attempts in this context means that company employees come together internally to gain access to digital safes.

This means a well-functioning digital vault for digital assets requires an elaborate technical solution for:

  • key generation
  • signing procedure
  • the storage of private keys (and backups) at different geographic locations.

Social engineering can be imagined as a psychological strategy in which attempts are made to gain access to digital safes through targeted manipulation. But apart from that, a well-designed digital vault should have further features to make it more secure. First, we have a closer look on how the private key is stored ideally before we go into more details on the signing of transactions.

“From the perspective of IT security, the aspects of recognition performance and security are of particular importance when considering biometrics.”

Federal Office for Information Security, Germany

In general, it is very common to secure devices which hold the private keys in a physically secured bank vault which is similar to gold storage, however, there are some important differences. To begin, the devices on which the private keys are stored should be protected with additional digital security measures. Only specific predetermined persons may access the device with identification through biometric data such as fingerprint. In addition, entry is only allowed at specific predefined times or else if specifically authorized by the board of directors of the company operating the digital vault. This reduces the probability of unwanted signature generating events virtually to zero.

Cold vs. Hot Storage Custody of Cryptocurrencies: If the wallet is connected to the Internet, this private key is exposed to potential hacker attacks. Because of the online connection to internet, this type of storage is called hot storage. A cold wallet, in contrast, is a storage space that is not connected to the Internet. The keys with which you can manage your digital money are stored offline. This of course reduces the risk of DDoS attacks and hacker attacks considerably.

Most importantly, only transactions authorized by a predefined quorum of decision makers may be signed with the corresponding private keys. In order to achieve that, typically an additional cryptographically secured authorization layer is put in place. This layer is an addition to the cryptography securing the digital asset itself. Each digital vault operator defines its own authorization processes which can be adapted to different internal processes or client needs. For example, one could agree that the authorization process of a transaction must involve at least three people on the client side signing a transaction approval with their individual authorization keys stored on personal security devices. The authorization process should involve biometric data or other second factors like chip and pin. In order to prevent theft by colluding employees within a custodian, it is reasonable to include a business logic that technically requires the authorization by the client. However, the board of directors could mutually change the business logic of the authorization layer to access the digital assets without authorization by the client. They could even just access the master key backups directly if not properly secured through profound business continuity management (BCM). This is why it is important to rely on a custody provider with trustworthy management that is audited by regulatory authorities. Also, the custody provider must show a thoughtfully implemented segregation of duties since human interaction is the most critical point of failure.

An example of such a BCM rule could be this: Nobody can access the safe deposit box which stores the backups without having registered with the safe company a week in advance. Upon this “one-week in advance registration”, everyone in the company would receive an email/SMS message announcing the registration. Then, only one person with biometric data and/or two-factor authentication can access it on that day at that specific time. In addition, in order to change this rule with the vault company, a quorum of management approvals through formal request and verification would be required. A similar approach could be established for hardware wallets to access them for firmware updates. This could be in the form of a certain quorum of signatures from managers that would be required to overwrite the bootloader and allow firmware updates etc.

If you plan to store your digital assets at a custody service provider, it is of utmost importance to check their technical solution on whether it is designed according to industry standards which reduces risk for loss, theft and fraud of private keys to the lowest possible. A good custody provider should provide the following:

  • A digital vault (cold storage) with at least 2 out of 3 multisig.
  • Distribution of partial keys on different geographic locations in countries which are considered to have a stable system in regard to respecting proprietary rights (USA, Singapore, Switzerland, Germany, etc).
  • Safe backup of the private key which should again be distributed geographically, or alternatively, a sophisticated key rotation scheme.
  • Trustworthy management audited by regulatory authorities.
  • Authorization layer that requires customers’ consent to sign transactions.

Figure: Services of a Good Custody Provider

Services of a good custody provider

Source: Incrementum AG, Daniel Wingen

Self Custody vs Serviced Custody

James Howells is a multi-millionaire – and somehow not. Thousands of Bitcoins are slumbering on his hard drive, which is now worth 75 million euros. The catch: The hard disk is buried in a dump. 

The obligation to hold the assets under management means no more than that the funds must be placed externally within a depositary.

The above chapter showed that the process of setting up and maintaining a digital vault to secure a significant amount of digital assets does require a lot of specialized knowledge and well thought through security procedures. Such a complex setup is currently hardly feasible for a private person or small company without investing a significant amount of resources in research and development. This will very likely change in the future, but currently self-custody always comes with reduced security if proper knowledge and secure technical implementation is absent. To achieve a certain level of security, one has to know the technology quite well and understand the digital assets specific mechanics of the public private key methods used. Then, one needs to store the private key safely in a way that it cannot easily be stolen or lost. If the private key is lost, then the digital assets cannot be accessed by anyone anymore which equals a total loss of the assets. Understanding the technical mechanisms of accessing digital assets with a private key requires time and can be very difficult to grasp for the less tech savvy people. In addition, one needs to make sure that one’s heirs may obtain access but only when the time has come. This problem can be easily solved with serviced custody, but it is rather difficult to solve in self custody. Self-custody for corporations is even more complex since access to the private keys must be split and distributed to several people to ensure that no single person has access to all funds. If only one person had access and this person gets involved in a deadly accident, then all funds of the corporation would be gone – a situation which shall never occur. Depending on the jurisdiction, financial service providers are even obliged by regulation to store their assets under management in custody. In Germany, however, the separation between financial service companies and custody was eliminated by law.

The idea behind Bitcoin, however, is decentralization and censorship resistance. Bitcoin technology hands people back their financial self-sovereignty and creates a level playing field where every individual, company or bank has the same entry barriers to transfer the asset globally with near instant settlement – but only if one controls the private keys. In line with this, there is a common perception of “not your keys not your bitcoin” which encourages self-custody.[1] We see it as reasonable to have a balanced perspective on self-custody and serviced custody by looking at the pros and cons of both. Deciding on the custody solution for your digital assets should include:

  • your knowledge on the technical solution,
  • the general pros and cons of the options as well as
  • the amount of funds to be stored
  • and the specific use case.

Private individuals can simply store smaller amounts of digital assets with consumer grade hardware wallets which are easy to use and provide reasonable security if handled with care and a basic knowledge of the mechanics involved.

Regulatory Developments in DACH (Germany, Austria, Switzerland)

“New obligated parties (of the 5th AML Directive) are platforms for exchanging virtual currencies and providers of electronic purses (wallets) for virtual currencies (e.g. Bitcoin) etc.”


The 5th Anti-Money Laundering (AML) Directive is the most important regulation for digital assets in the European Union so far. The directive lays out the anti-money laundering obligations imposed on cryptocurrency businesses which includes the requirement for Know Your Customer (KYC) processes to identify customers. This legislation provides more clarity for national states and businesses on how digital assets are regulated.

Germany pioneered the issuance of crypto custody licenses that came into effect on the 1.1.2020. Crypto custodians now have to apply for a “Kryptoverwahrer” license to provide custody services for digital assets, however, existing custodians are allowed to keep up their business until a decision on the license application is made by the BaFin, the German financial market authority.

Austria made amendments to their Austrian Financial Markets Anti-Money Laundering Act (“FM-AMLA”) and the Beneficial Owners Register Act (“BORA”). Crypto Custodians need to be registered with the Financial Market Authority since 10.1.2020. In Austria, no license is needed to provide crypto custody service. The AML amendments merely require enhanced due diligence measures if a high-risk third country is involved in a transaction.[2]

The 5th AML directive does not apply to Switzerland since the directive is EU law. According to the Swiss Financial Market Supervisory Authority FINMA, “Switzerland has always applied the Anti-Money Laundering Act to blockchain service providers”.[3] In 2019, FINMA granted SEBA Crypto AG and Sygnum Bank AG a full banking and securities dealer license.[4]

Global State of Custody Service Providers

“[Custody] is the missing piece for infrastructure – it’s a treacherous environment today. Hedge funds need it, family offices need it, they can’t participate in digital currency until they have a place to store it that’s regulated.”  

Mike Belshe, Co-Gründer & CEO von BitGo

We have identified more than 20 custody providers operating at the end of 2019 with Coinbase, BitGo and Bakkt being the largest. Coinbase has become famous with its exchange services. The company is managing assets with a value of USD 7bn in 2019.[5] Bakkt is created by CE the company behind NYSE and known for introducing Bitcoin futures that are fully backed with “physical Bitcoins”- in line with the company’s name.  This means that the bitcoin to fulfill a buy position that is scheduled for the future is already available by Bakkt. BitGo provides clearing and settlement services that are connected to several exchanges, OTCs, hedge funds and more. The customer may decide which party to choose and to settle a trade with while the funds are locked during settlement which minimizes counterparty risk.

Figure: Projected Tokenized Market Volume until 2027

Projected Tokenized Market Volume until 2027

Source: Finoa AG, finoa.io[6]

In Germany, ING Diba, the most famous direct bank, announced to apply for the crypto custody license[7] as well as Solaris Bank, the banking as a service provider for startups[8]. According to Finoa, a Germany based custody provider, the amount of tokenized assets under custody will reach 1 trillion by 2020 and 24 trillion by 2027. However, these statistics mostly focuses on equity, debt and tokenized real estate, neglecting the expected increase of Bitcoin market capitalization according to the Stock-to-Flow model.[9]

[1] A detailed report on self-custody can be found here for free: https://www.smartcustody.com

[2] https://www.schoenherr.eu/publications/publication-detail/the-impact-of-the-5th-anti-money-laundering-directive/

[3] FINMA Guidance 02/2019https://www.finma.ch › finma-aufsichtsmitteilungen

[4] https://www.caplaw.ch/2019/finma-grants-banking-licenses-to-new-swiss-crypto-banks-introduces-new-strict-aml-rules-regarding-payments-on-blockchain/

[5] https://blog.coinbase.com/coinbase-custody-acquires-xapos-institutional-business-becoming-the-world-s-largest-crypto-2c1b46fc94c4

[6] https://hackernoon.com/market-outlook-on-tokenized-assets-a-usd24trn-opportunity-9bac0c4dfefb

[7] https://www.reuters.com/article/us-crypto-currencies-ing-exclusive/exclusive-ing-working-on-digital-assets-custody-technology-sources-idUSKBN1YF2GN

[8] https://solarisbank.pr.co/184220-solarisbank-launches-subsidiary-solaris-digital-assets-to-drive-adoption-of-crypto-and-further-digital-assets

[9] https://medium.com/@100trillionUSD/modeling-bitcoins-value-with-scarcity-91fa0fc03e25

Should It Be Legal To Steal Bitcoin?

Should It Be Legal To Steal Bitcoin

Bitcoin is a technology that has only existed for 12 years and has risen to prominence in an even shorter period of time. As such, there is still a lot of confusion regarding many of its facets, from its economic status, to its monetary status, to its long-term viability.

One under-explored facet of bitcoin is its legal status. Specifically, how can ownership be determined for bitcoin (or other cryptocurrencies)?

The reason we care about this is because there has been increasing scrutiny on regulating bitcoin. In order to have effective regulation, there must be a deep understanding of what is being regulated. If regulators thought the first airplane was able to travel faster than the speed of light, it’s very possible that regulators would have put rules in place that would have crippled the industry.

Similarly, everyone must be on the same page when it comes to understanding the very basics of bitcoin, lest we might see some unnecessarily confusing, contradictory, and industry-destroying patterns of regulation.

Before we can begin to answer the question of how to determine ownership in bitcoin, we must understand what ownership means, review how bitcoin works, and then combine the two concepts together. The short answer is: it’s complicated, but there is a case to be made that nobody owns your bitcoin.

First, a review of what ownership means. There are two senses in which the word is used: economically, and legally. Economically, ownership refers to physical possession—the ability to physically control a good. Legally speaking, ownership entails certain rights and responsibilities. You may or may not need to be in physical control of a good to retain legal ownership.

This distinction was also noticed by the eminent Austrian economist Ludwig von Mises in his 1922 book, Socialism: An Economic and Sociological Analysis:

Thus the sociological and juristic concepts of ownership are different. This, of course, is natural, and one can only be surprised that the fact is still sometimes overlooked. From the sociological and economic point of view, ownership is the having of the goods which the economic aims of men require… The Law recognizes owners and possessors who lack this natural having, owners who do not have, but ought to have. In the eyes of the Law ’he from whom has been stolen’ remains owner, while the thief can never acquire ownership. Economically, however, the natural having alone is relevant, and the economic significance of the legal lies only in the support it lends to the acquisition, the maintenance, and the regaining of the natural having.”[1]

The distinction can be made clear with an example: you may own a car legally even if you have lent it to a friend for an hour. However, during that hour, your friend is the person who owns the car economically. If your friend does not return your car within the specified amount of time, you can seek legal action against him for theft.

Furthermore, there are some things you cannot own. Economically, you cannot own something that isn’t physical. When we talk about “manipulating ideas”, we are speaking in metaphor. Ideas, information, patterns, etc., are not physical things, and so they are not scarce. As they are not scarce, they cannot be subject to economization: there is no need to economize on the idea that two plus two equals four, as infinitely many people can hold the same idea and it would not diminish in my mind.

It is also crucial to note that economic ownership has nothing to do with “value”. Value can be ascribed to both physical and immaterial things. Diamonds are valuable, but so is a sense of accomplishment. A mosquito has very little value, as does the thought of an alternative reality where everything is the same except we refer to red as “blue” and blue as “red”.

Similarly, legal ownership also has nothing to do with value. You may have legal ownership in objects with little value, such as a stack of dusty old newspapers. You may also be legally prohibited from owning scarce goods that are highly valuable, such as the surface of the ocean.

The key for determining whether something can be owned economically is only whether it is a physical object. On the other hand, while the law can only ascribe rights to economic goods in a fundamental sense (how can you have a legal right to something that you can’t physically control?), the law may ostensibly declare a right to anything.

This discussion may strike some as academic hairsplitting. However, in lieu of strict definitions and rigorous logic, we may end up with analysis by metaphor, simile, and figures of speech—in other words, fantasy storytelling instead of dealing with reality seriously. When these confusions are then applied to cryptocurrencies, serious issues can arise. As all metaphors are imperfect, bad metaphors will give rise to bad arguments in favor of bad regulations, leading to bad results.

Hence, the necessity of wielding the sword of logical consistency against the chaotic dragon of analogy. Armed with this new terminology, we can now analyze what it means to own a bitcoin.

A bitcoin is not a concrete, discrete physical thing. It is a pattern of information, first and foremost, and (just as crucially) it is stored on a distributed, virtual ledger. Specifically, the ledger is distributed among millions of other computers, which share updates about changes in the ledger with each other over the internet.

So immediately, we can know that there can be no economic ownership of bitcoin. Even if you have a “paper wallet”, the paper is not your bitcoin. If your wallet is on your computer, it is a convenient metaphor to say that your bitcoin is “in” your computer. Your bitcoin is a pattern of information; a set of instructions to a computer.

Furthermore, you do not have full control of what you can do with your bitcoin: you require consensus from other nodes in the network. Those other nodes are other people using their own computers on their own property. They can be located anywhere in the world.

You do not physically own their computers, their property, or the individuals. To “own” bitcoin in any sense would necessarily require your economic ownership of the computers, property, and even minds of other individuals.

What would it mean to legally own bitcoin? To repeat from above, legal ownership gives certain rights to you that creates certain obligations in others. Specifically, it is about returning to the legal owner property that is in the physical possession of someone else.

So let’s say you had one bitcoin, stored on a wallet on your laptop. Then, late one night, Sneaky Suzan breaks into your house, opens your laptop, gets access to your wallet, and transfers your bitcoin to her wallet, then carefully places are your stuff back to their original locations before running out of the house.

Suzan is clearly guilty of breaking and entering, trespass, computer trespass, and other property crimes. But did she steal “your” bitcoin? To figure out if she stole something, we need to figure out who the original owner was. To say you “own the bitcoin”, says patent attorney and legal theorist Stephan Kinsella, implies:

“you have some legal right to control how the ledger is represented on many people’s private computer memory devices. And because they own their computers, and you don’t own your computers, you have no right to tell them how to update the ledger stored on their computer.”[2]

Naively, it would mean that Suzan would have to give you back “your” bitcoin (plus other damages). But what if she spent it already? Would bitcoin miners be obligated to revert back to the point in the blockchain before the theft, creating a new fork? In the view outlined in this article, this is an untenable idea. A much better solution is to give the cash value of the bitcoin at the time to the victim. (The “cash value” approach would also work even if bitcoin became the most commonly accepted medium of exchange.)

A final problem: what if someone, by sheer luck, guesses your private key and is able to access the wallet on your laptop and spend the bitcoins at will. They have not committed any property crime; but neither have they committed a bitcoin crime. They followed the rules of the protocol, and the result was exactly the same as though you had your bitcoin “stolen”.

The legal theorist Konrad Graf has an interesting approach to this: this problem is analogous to a businessman who copies a competitor’s business plan and wins market share as a result. As Graf tells it:

A businessperson Dan sees rival Tim’s more efficient work method by observing from across the road and then begins to emulate it. This increases Dan’s competitiveness. Tim claims he has lost sales, market share, and business value due to this “idea theft.” Tim had a reputation as the market leader. Now, he has been rendered one competitor among others, next to Dan, and it is Dan’s fault. Not only has Tim’s market share dropped, but also his reputation value.

Tim’s legal claim would have to be dismissed according to principles of action based property theory, because the work method that Dan observed and then emulated is not itself ownable. An idea or opinion is not a rival good. Dan did not otherwise trespass or infringe on Tim’s property. Dan observed from a location that Tim did not own and later emulated certain practices that he observed. None of these acts violated a valid property right of Tim’s.[3]

In a sense, “your” bitcoin is only yours because you know the password for transferring it. Nothing else about bitcoin is ownable in the economic sense: it is a pattern of information, it is distributed across many other properties, and those properties necessarily are owned by other people. As a result, it is impossible to legally own bitcoin, as it seems it would require obligations to people you have not met or contracted with. And, as a shocking but necessary conclusion: if no one can legally own bitcoin, then no one can be charged with stealing it, either.

To echo the opening of this article, there is still a lot of work to be done in understanding the legal principles behind bitcoin.

[1] Mises, Ludwig von. Socialism. P. 37 https://cdn.mises.org/Socialism%20An%20Economic%20and%20Sociological%20Analysis_3.pdf

[2] Kinsella on Liberty podcast: Episode 233 http://www.stephankinsella.com/paf-podcast/kol233-mises-uk-bitcoin-ownership/?fbclid=IwAR3RsRhJ9h8KKoAe95WG4wVfBqFIc4JLTEtmTDxdwsI4gcS_eqmgDd_dGeM

[3] Graf, Konrad (2015) Are Bitcoins Ownable? https://static1.squarespace.com/static/5720adbdc6fc0891cbcce17c/t/580e138c2994ca6771b9c135/1477317533610/Are%2BBitcoins%2BOwnable%2BBook%2BFree%2BPDF%2B5Nov2015.pdf

Goldman Sachs and Citi Bank Settle Equity Swap on Permissioned Blockchain Axoni

Goldman Sachs and Citi Bank Settle Equity Swap on Permissioned Blockchain Axoni

For several years legacy financial companies have started to integrate blockchain technology in their existing business model. While digital-native and decentral-native start-ups have been able to directly build on public blockchains like Cosmos, Tezos or Ethereum, legacy finance firms with their complex IT infrastructure started to test private blockchains in order to become familiar with the technology, remain regulatory compliant and experiment in a controlled and surveyed environment with their clients. R3 Corda for example has become the primary permissioned blockchain platform for the legacy financial service industry.

While many companies believe that this is the ultimate goal, several banks, like Goldman Sachs for example, have already left the Corda platform. They belonged to the early joiners, but already left in 2016. However, just last week, Goldman Sachs and Citi announced to conduct the first blockchain equity swap on an Ethereum inspired platform. To conduct this swap, they are collaborating with a new market player called Axoni.

Developments in the Permissioned Blockchain Space

Axoni gave an interesting talk in Prague at DevCon 4 in 2018. They introduced AxLang as a new programming language for secure and reliable Ethereum smart contracts. The speech can still be viewed on Medium. Similar to Hyperledger or Corda, their approach is to use a permissioned distributed ledger platform based on open source software in order to help legacy firms use blockchain technology to operate more efficiently with their customers. Axoni specifically focuses on derivative markets.

The big advantage is that their infrastructure is built on Ethereum, which is still the largest used blockchain for DeFi applications. According to Defi Pulse, the total value locked in Defi surpassed USD 1 billion on February 9, 2020.

Figure 1: Top 5 DApps on Ethereum

Apart from the Lightning Network, which builds on Bitcoin, all DeFi applications are based on the Ethereum blockchain. This finding is confirmed by State of the Crypto Report, which shows the strong developments and progress around Ethereum and Bitcoin.

Previous market players have struggled to implement Ethereum based permissioned applications. Bank Vontobel, previously a Premium Partner of the Crypto Research Report, for example wanted to launch a certificate on ethereum as well, but there was one main problem. The legal situation and the lack of a payment token recognized between banks has prevented them from conducting the complete process exclusively on the blockchain.

Hence the news around the US investment banks Goldman Sachs and Citi using the Ethereum blockchain is even more positive. Especially with regards to the status of US crypto regulation, where the SEC is extremely reluctant and causes many roadblocks.

While there are just a few crypto advocates in the US, like the so called “crypto mom” Hester Peirce, the EU is overall much more crypto friendly, especially in Germany. Since the Money Laundering Act came into force on January 1, 2020, in which BaFin financial institutions were allowed to conduct crypto asset transactions, more than 40 institutes have shown interest in crypto custody business.

Solaris Bank for example has taken a similar approach to Fidelity with cryptocurrency custody. The young German bank Solaris AG founded the subsidiary Solaris Digital Assets GmbH in December 2019 as digital asset custody service provider. They consider themselves as tech company with a banking license. Alexis Hamel, Managing Director of Solaris Digital Assets says:

“We commit ourselves to become the leading infrastructure provider for the European digital asset ecosystem. We trust that by lowering the hurdles for digital asset pioneers, we are contributing to the development of a functional and secure decentralized world, which will transform the way we exchange value around the globe.”

Alexis Hamel

Private blockchains can constitute the perfect testing environment for legacy firms in order to learn about the technology and make their clients familiar with it. However, in order to unlock the full potential of DLT solutions, the ultimate goal should be the use of public blockchains and full business integration of digital assets.



Digital currencies’ rise to power: the case study of Brazil, Sweden, and Switzerland

number of blockchain wallets worldwide chart

Are digital currencies the wave of the future? Sweden, Switzerland, and Brazil move towards digitalized financial systems, exploring new possibilities of adapting to the ongoing FinTech revolution. E-krona, Swiss franc stable coin, and Pix system are all national responses to the growing cryptocurrencies’ market.

The potential of digital currencies is undeniable: the number of Blockchain wallets has grown over 4 times in the span of the last 3 years, from 10,98 million in late 2016 to 44,69 million by the end of 2019.[1] Powered by people’s enthusiasm, the planet of digital currencies attracts the attention of national banks all around the world. This month, Swedish and Swiss national banks decided to step into the future with the plan to create their own digital currencies, while Brazil came up with its own payment network Pix to lower costs of the national financial system and smoothly transition into the world of Fintech. Governments can no longer ignore the technological revolution, so they join it instead.

Inspired by Blockchain technology, Sweden has started working on its own version of digital currency: e-krona. The pilot project is expected to run for a year and finish by the end of 2021.The Riksbank’s goal is to discover how e-krona could function in Swedes’ everyday life. Envisioned as a user-friendly, secure alternative to cash, it is set to work with cards and smartwatches to guarantee maximum comfort at minimum difficulty. The technical aspects of the project draw from Distributed Ledger Technology (DLT), used also by Blockchain. The exact process of creating e-krona is yet to be decided, and there is no fixed date for its debut. The Riksbankwants to understand the inner working of e-krona before issuing it, so the one-year project is mainly the market research. In all certainty, there is a need for a fintech solution in Sweden, where cash is slowly fading into obscurity, replaced by smartphone applications.

Sweden is not the only country, which announced the creation of its own digital financial system this week. Brazil, where 18% of surveyed people have already had experience with cryptocurrencies[2], is an immense market for fintech innovation. The central bank of Brazil decided, however, to take matters into its own hands and test a brand-new payment network – Pix. To offer the optimal coverage and easily blend into the Brazilian financial landscape, the system will be used by all major financial institutions, including the country’s biggest banks, effectively becoming integrated into 90% of all active bnks accounts in the country.

Pix is set to operate through an application, which allows for instant money transfer and QR code scanning. The tests have just officially begun, but in nine months’ time – November 2020 – Pix may be open to the public for the first time if things go right. The officials’ plans are definitely ambitious: the mass adoption of the system is scheduled for 2021. In fact, the president of the Brazil’s central bank, Campos Neto, acknowledged the need for the new payment methods in the digital age, saying that “the world demands a payment instrument that is cheap, fast, transparent and secure” and he called Pix one of the most important projects of the year, stating that it would be the Brazilian answer to bitcoin and cryptocurrencies. Designed to enable a wide range of transactions, including paying government fees, and mandatory for the country’s major financial players, Pix might be Brazil’s digital future in the making.

In the midst of the fintech revolution, Switzerland doesn’t remain a passive bystander. Swiss Central Bank announced plans for its pure digital currency to dive into the digital future on its own terms. While the project’s exact details and likely launch is unclear, Swiss transition into to the digitalised banking continues in 2020, with the launch of Swiss Digital Exchange (SDX) planned for the end of the year.

As the increasing number of governments acknowledge the need for new banking systems, the future of digital currencies looks bright. With Brazil’s ambitious plans to accelerate its own fintech transformation, Sweden’s hopes to offer its citizens the institutional replacement of obsolete cash, and Switzerland’s slow but inevitable financial adaptation, the world is ready to move into the post-cash era and redefine the way we view money.

[1] See Number of Blockchain wallet users worldwide from 3rd quarter 2016 to 4th quarter 2019”, Statista

[2] See “How Common is Crypto?”, Statista

Bitcoin’s furious plunge to under $9,000 per bitcoin

Bitcoin’s furious plunge to under $9,000 per bitcoin

The price of Bitcoin, by far the biggest player among all cryptocurrencies, fell more than 10% within the last few days. Other major cryptocurrencies, such as Ethereum, Litecoin and Bitcoin cash, have also decreased in value, but Bitcoin’s decline generates the most headlines, as earlier this year, it noted the record $10,000 per bitcoin and was showing no signs of slowing down. In the course of the last few days, Bitcoin lost $30 billion in value, going down 0,22% within the last 24 hours. Created by unknown individual(s), Bitcoin was designed to enable fast, cheap transactions without using traditional banking, and when its price went up at the beginning of the year, many started to regard it as a ‘safe-haven asset’ and the answer for the global trade crisis connected to coronavirus. China’s participation in the cryptocurrencies’ market is enormous, so given the latest course of events regarding the virus, the cryptocurrencies’ decline seems natural for some, while other industry experts, such as Vitalik Buterin call it “rationalised bullshit”.

Despite Bitcoin’s drop in value, many remain positive about its future, as it is driven by demand, rather than GDP. The entire business model of Bitcoin is based on scarcity, much like the former monetary programs, which only allowed printing the amount of money corresponding to the actual amount of gold. To ensure such scarcity, Bitcoin invented the process of halving, or simply reducing the total supply over time to boost the value of the cryptocurrency. Typically, Halving takes place every four years and the next one is set to take place in May 2020. Experts predicted that the price of Bitcoin would increase several times and reach up to $70,000 per bitcoin. Whether it is wishful thinking or an accurate prediction, only time will tell.

Bitcoin Marketcap q1 2014 to q4 2019

Nevertheless, it is without a doubt that Bitcoin continues to develop and improve its services, particularly in terms of privacy and scalability. In the first half of 2020, we can expect the launch of a consumer application for Bitcoin and cryptocurrency purchases. The app will be supported by Starbucks, Microsoft, and Boston Consulting Group. Despite a sudden decline in value, Bitcoin’s market capitalization equivalent is substantial. According to Statista’s database [1], between the first and last quarter of 2019, it increased by over 57%, from 72,37 billion dollars in the 1st quarter to 169,44 billion dollars in the 4th quarter. Square, one of the companies, which included Bitcoin in their payment methods, observed a 60% rise in the number of active users in the last quarter of 2019. The company’s revenue increased by 41% within a year, reaching over $1,3 billion dollars. Why is their success attributed to the Bitcoin adaptation? Half of $361 millions produced by Square’s Cash app were generated by Bitcoin transactions – in just 3 months. Numbers seem to be in favour of cryptocurrencies, even when investors are not. During the meeting with crypto representatives, the famous investor Warren Buffet was reported to have donated all cryptocurrencies he was given to the charity, stating that “I don’t own any cryptocurrency. I never will.” Regardless of the current crypto landscape, Bitcoin’s kingdom is yet to fall, but will it quickly recover? Remains to be seen.

Change is the only constant in the world of cryptocurrencies. Although Bitcoin lost $30 billion in value within just a few days, it continues to attract customers across numerous applications, having generated half of Cash app’s revenue in just 3 months. Powered by demand, it may rise again, once scarcity’s in play.

[1] See Market capitalization of Bitcoin from 4th quarter 2013 to 4th quarter 2019, Statista

https://cryptovest.com/news/bitcoin-btc-price-falls-through-several-supports-as-coronavirus- fears-grip-the-globe/
https://www.techspot.com/news/84185-square-half-cash-app-quarterly-revenue-came- bitcoin.html

Are Overpriced Publicly Listed Blockchain Stocks an Opportunity?

Are Overpriced Publicly Listed Blockchain Stocks an Opportunity

Several blockchain-based companies are publicly listed on stock exchanges throughout the world. Some of them are trading at an unwarranted price given their revenues and earnings potential. Some have even already gone bust like Riot Blockchain Inc. (RIOT) that dropped 97% from an all time high of $46 in 2017 down to the current price of $1.33, or they have switched business models like Fortress Blockchain Corp. now called Fortress Technologies Inc. (FORT) after quarters of consecutive million dollar losses.

This article is a sneak peek of the Crypto Research Newsletter published every week to our subscribers. We do not often publish these posts publicly, so if you would like to receive professional financial analysis of crypto assets weekly subscribe here: https://cryptoresearchnewsletter.substack.com/

In this week’s edition of the Crypto Research Newsletter, we discuss how to value publicly listed blockchain stocks, and how some investors with deep pockets are turning overvaluation into an opportunity.

There are several ways to value a publicly listed stock. This week, we wanted to evaluate if Michael Novogratz’s Galaxy Digital Holdings Ltd. traded on the Toronto Stock Exchange with ticker GLXY was a good buy or not. Galaxy Digital does venture capital, they sell investment products, they do lending, and they do market making, amongst other activities.

The market capitalization of Galaxy Digital is $88.56 million Canadian Dollars (CAD). The stock price is $1.32 CAD. Is this a good buy at $1.32 or not? There are many ways to answer this question, but a simple way is just to compare Galaxy Digital’s price to comparable firms.

Comparable blockchain firms that are listed on the Toronto Stock Exchange include Hive Blockchain Technologies Ltd., Bitfarms Ltd., Cryptostar Corp., Neptune Dash Technologies Corp., Fortress Technologies Ltd., and AnalytixInsight Inc. The market capitalization, revenue and Price to Sales Ratio (P/S) are listed in the table below.

Table 1: Price to Sales Ratio of Publicly Listed Blockchain Companies

Source: Toronto Stock Exchange, CryptoResearch.Report

Just a quick glance at the table shows that Galaxy Digital is relatively low priced compared to other blockchain firms. Galaxy Digital’s Revenue in 2019 was $156 million, higher than the company’s $92 million CAD market capitalization. This gives Galaxy Digital a P/S Ratio of 0.59 compared to the group average of 13.9. Galaxy Digital’s stock has increased 26% since the beginning of this year from $1.05 to $1.33. However, the company is still not turning a profit after costs.

A quick glance at Table 1 also shows a humungous outlier. Namely, Neptune Dash Technologies Corporation. Neptune Dash is a company that hosts masternodes on the Dash network. They currently have 16 masternodes, or approximately 16,100 Dash worth around $1.7 million USD and they have invested in Cosmos (ATOM). Even though everyone says that Tesla is overpriced, Tesla (TSLA) is still only trading at a P/S Ratio of 6.5x their annual revenues. Apple (AAPL) trades at 5.5x their annual revenue.

Figure 1: Neptune Dash Stock and Dash are Highly Correlated

Figure 2: Grayscale GBTC Stock and Bitcoin Are Even More Correlated!

So how can a 73x P/S Ratio be warranted? One interpretation is that 73x could be a very early stage startup multiple meaning that investors expect for Neptune Dash to earn a lot more in the future than they are currently earning.

Another interpretation is that institutional investors cannot easily hold privacy coins directly in their portfolio, and are therefore, willing to pay more for a publicly listed stock that gives them access to privacy coins. There is some evidence of this with stocks like Grayscale’s GBTC Bitcoin tracker that has more often than not traded at a 20%-30% premium over the spot price of Bitcoin during the past few years.

Grayscale has 303,363,800 outstanding each worth $11.72 USD, and each share is backed by 0.00096645 Bitcoin, worth approximately $9.33 USD. This means that GBTC shares are trading at approximately 25.6% premium over the spot price of Bitcoin. An obvious trading strategy would be shorting GBTC and holding Bitcoin long, but this has not worked well in the past for traders, because GBTC’s premium has persisted month after month. Grayscale has approximately 293,185 Bitcoin under management and charges a 2% annual fee on a passive investment strategy, which at first glance, seems high, but is actually quite reasonable given the fact that cryptocurrency custody is not that straightforward.

When comparing the Neptune Dash stock price to the Dash price, an average 90-day rolling correlation of 70% is found over the past two years since Neptune Dash was listed on the Toronto Stock Exchange. The only time that these two assets had a negative correlation was during December 2019 and early January 2020, when the price of Dash was going down and the price of Neptune Dash stock was going up. This can most likely be explained by the fact that the drop in Dash’s price triggered a massive selloff of Dash masternodes, which meant that the existing masternodes earned more. Since Neptune Dash runs masternodes, this means that their earnings went up on each node.

In contrast, the GBTC average 90-day rolling correlation with Bitcoin is much higher, at 83% over the past five years and 92% over the same time span that the Neptune Dash and Dash correlation was calculated over.

One final note on this peer group of blockchain firms: there is an unfortunate back story to Fortress Technologies Ltd. The company was listed on the stock market in 2018, and is currently trading at $0.12 CAD. This is the epitome of a crypto penny stock. The company has basically no information on their website and the last post that Fortress Technologies Ltd. made on their Twitter account was in 2018 shortly after being publicly listed. We were surprised to find that Roy Sebag and Josh Crumb from Goldmoney are part of the Fortress team. Apparently, their attempts at Bitcoin mining did not pan out as expected, as they officially removed “blockchain” from their name in April of 2019 after consecutive quarters of layoffs and losses.

In conclusion, Grayscale and Neptune Dash seem grossly overvalued when comparing their share price, number of shares outstanding, and earnings. This is most likely a symptom of all stock prices being grossly overvalued because the Fed’s faucet of money is flooding the market and investors are betting on scarce crypto assets as being a hedge against fiat inflation. This will not last forever, but as Keynes said, “markets can remain irrational a lot longer than you and I can remain solvent.”

This Week’s Top Cryptocurrency News

Wyoming’s Blockchain lady, Caitlin Long, is starting the first Bitcoin Bank called Avanti. We are personally excited at the CryptoResearch.Report, because Caitlin is one of the few people in the Blockchain space that combines competency, hard-work, and honesty – all qualities needed for a company to have long-term success in the crypto world! Read more.

Tomorrow, Wednesday the 26th of February, the U.S. Securities Exchange Commission will decide if the Wilshire Phoenix exchange traded fund (ETF) on Bitcoin will be approved or not. If approved, the ETF will have fees of 68 basis points (0.68%) per annum and a maximum share price of $2,500 USD. Read more.

No Central Bank Digital Currencies (CBDCs) have been officially launched so far, but Sweden will probably win the race with their e-krona. Read more.

Winners and Losers

Everything that goes up must come down, and this week was not very kind to Chainlink or the crypto asset market in general. Chainlink is down – 13.64% this week, but is still up 116% year to date with a current price of $3.91 compared to $1.81 on January 1, 2020.

The past week’s largest cryptocurrency winners from the top 50 market capitalization are Cosmos (3.02%), Litecoin (1.63%), and MKR (0.73%).

The biggest losers were Chainlink (-13.64%), Bitcoin Cash SV (-11.82%) and Dash (-10.96%). 

Figure 3: Largest 7-Day Returns for Top 50 Market Capitalization Coins

Source: Coincodex.com, CryptoResearch.Report

Crypto Research Report Portfolio

Bitcoin has had a second week of losses, and is down 1.21%. Due to the wide diversification of the assets held in the Crypto Research Portfolio, the weekly return for the portfolio was positive. This is mainly do to our gold coin Pax Gold shooting up 8.2% in value after the stock market sell-off. As of February 25th, 2020, the portfolio’s value increased by 205 basis points or 2.05% in the last six days since the last edition of the newsletter was published on February 19th, 2020. Gold is an interesting asset given the economic uncertainty surrounding the Corona Virus.

This section is for our members only. To see our entire portfolio in this week’s Crypto Research Newsletter, subscribe here: https://cryptoresearchnewsletter.substack.com/

That’s all for this week folks! If you would like to read our free 50-page quarterly report supported by Falcon Private BankCoinfinity, and Incrementum visit CryptoResearch.Report. The report is available in English and German. 

Uphold Introduces Commission-free Cryptocurrency Trading, and the World’s Easiest User Interface

Leading digital money platform Uphold today introduces zero-commission trading on cryptocurrencies in a milestone for the industry designed to open up affordable access to one of the world’s most important new asset classes for millions of retail investors.

“In practical terms, there’s now no easier or more cost-effective way for retail investors to trade cryptocurrencies and other assets”

Initially available only on iOS and Android mobile apps, the move represents a seismic shift in a sector that until now has largely resisted the commission-free model revolutionizing stock and ETF trading. Before today’s announcement, cryptocurrencies were one of the more expensive asset classes for retail investors to trade, with fees north of 200bps on some mainstream platforms.

‘Our goal is to create the easiest and most cost-effective place for retail investors to buy and sell cryptocurrencies and other assets,’ explained J.P. Thieriot, C.E.O. of Uphold. ‘And unlike our competitors, we’re staying true to the fundamental premise of cryptocurrencies: financial self-sovereignty.’

‘At Uphold, you can move your crypto into private wallets at will; send funds to virtually anyone, anywhere, instantly and free of charge; as well as use your holdings as a medium of exchange for payments. None of which you can do at Robinhood or Revolut.’

As an established platform listing 50+ currencies and providing account funding via seven cryptocurrency networks, debit/credit cards and bank connections in more than 40 countries – with the UK, Canada, Poland, Romania, Croatia, and Hungary added earlier this month – Uphold is the first major U.S. cryptocurrency venue to offer commission-free trading.

Simultaneously, Uphold is launching the world’s easiest trading interface, consisting of just two fields: ‘From’ and ‘To’. The ‘Anything to Anything’ screen means that a novice user can fund their account, send money to other people, or trade from any asset into any other asset directly, in two taps – on one screen.

The new interface surfaces Uphold’s unique advantage over its rivals: customers can trade directly between any supported asset, free from the limitations of Currency Pairs that still constrain choice and create unnecessary cost and complexity at many trading venues.

Whereas on most exchanges a conversion such as Mexican Pesos to XRP would require two trades and incur two sets of fees – Mexican Pesos to USD and USD to XRP – on Uphold, the process is one seamless, commission-free transaction.

“In practical terms, there’s now no easier or more cost-effective way for retail investors to trade cryptocurrencies and other assets,” said Thieriot. “No other platform gives customers such choice, freedom, and value for money.”

Uphold is also adding new funding and withdrawal options to the platform, which is now attracting up to 7,000 new accounts every day. For the first time, customers can fund their accounts with zero fees via credit* (and debit) cards – a new standard for the industry. Instant withdrawal to debit cards will be available in the coming weeks.

“The convenience of being able to withdraw your funds immediately to a bank-issued debit card is going to be a huge attraction for customers,” said Thieriot. “And in many parts of the world, it will be a first for a cryptocurrency platform.

“These are the biggest changes we’ve made since we started in 2014. Together, they make Uphold the easiest and most cost-effective place for retail investors to buy and sell cryptocurrencies, and break down the barriers that prevent people from investing and enjoying world-class financial choice.”

The web version of New Uphold is expected to launch later this month. iOS and Android Mobile Apps available to download now.

* For deposits into cryptocurrencies.

About Uphold

Uphold is a leading digital money platform with more than 1.7 million customers globally and almost $6 billion in transactions to date. It serves both retail investors and businesses. Leveraging blockchain technology, Uphold provides its customers with easy access to cryptocurrencies, national currencies, precious metals, yield/credit products, and soon crypto-backed debit cards. Customers can trade with zero commissions. Or send funds to virtually anyone, worldwide, free of charge, including payments to businesses and employees. Uphold is unique in translating all supported asset classes into a common digital language, which means that any asset can be exchanged directly into any other asset, creating an easy and intuitive trading experience. This Anything to Anything architecture cuts out unnecessary fees and complexity compared with other platforms relying on currency pairs, which would require an intermediate trade to exchange Mexican Pesos into XRP, for example. Businesses use Uphold to pay people around the world, or to accept customer payments in cryptocurrencies and convert them automatically into national currencies. Accounts can be funded via seven cryptocurrency networks, bank connections in around 40 countries, as well as debit and credit cards. The platform offers 27 national currencies, 30 digital currencies, and four precious metals. Uphold is available through web, iOS and Android applications.

Take to the sky using Cryptocurrency when you book flights through Alternative Airlines

Using Cryptocurrency when you book flights through Alternative Airlines

Alternative Airlines, a UK-based global flight search and booking platform, in October last year partnered with Utrust, a payment method offering cryptocurrency payments of your choice. With this partnership, Alternative Airlines customers can pay for flights to destinations around the globe using a range of cryptocurrencies including Bitcoin (BTC), Ethereum (ETH), DASH, DigiByte (DGB).

Alternative Airlines currently works with over 600 global airlines to provide customers with a greater choice of flights and payment methods. Partnering with Utrust means customers can pay for competitively priced flights rates through all the major airlines, including American Airlines, Delta Air Lines, United Airlines, British Airways, Virgin Atlantic, and China Southern Airlines. Specializing in off-the-beaten-track destinations, Alternative Airlines also works with national and regional carriers such as Air Chathams in New Zealand.

With the help of Utrust, Alternative Airlines’ customers can use an extremely safe way to pay. Utrust is providing customers with the increased security and convenience of cryptocurrency payments by offering buyer protection on all purchases and crypto-to-cash settlements.

Sam Argyle, Managing Director of Alternative Airlines, said, “At Alternative Airlines, we are committed to offering a seamless transaction process, while allowing our customers to choose how they want to pay. Alternativeairlines.com is a single platform for travellers to easily search and book flights on over 600 airlines. We believe crypto to be the money of tomorrow, playing an important role in the future of commerce. Therefore, we are incredibly excited, as our partnership with Utrust is the next major step in continuing to tailor the online booking experience to the customer, who now have the opportunity to pay with cryptocurrency on all of the airlines that we ticket.”

Alternative Airlines, an IATA-accredited agency, was featured in the 2019 Sunday Times Fast Track Tech 100, which highlights the top 100 fastest growing technology companies and awarded Best Selling Travel Agent in 2017. Customers can also choose from over 25 international payment methods — including all major debit cards and payment plans from all the best-known global providers — as well as over 160 localized currencies.

To search for flights from Alternative Airlines, visit https://www.alternativeairlines.com.

About Alternative Airlines

Alternative Airlines is a flight-search and booking website that offers a fast, easy and convenient way to book flights to remote destinations, as well as well-known locations. Alternative Airlines specializes in providing travellers with a wider choice of flights by working with more than 650 airlines including the smaller, regional ones across the world, especially in Latin America, the Caribbean, Africa and South-East Asia. Alternative Airlines’ global audience can enjoy over 25 international payment methods across 160 currencies.

About Utrust

Utrust is the leading cryptocurrency payment solution designed to modernize the finance and payments industry and solve the problems of traditional payment methods by offering instant transactions, buyer protection, and immediate crypto-to-cash settlements for the merchant. The Swiss-based startup was granted SRO approval to operate as a ‘financial intermediary’ under VQF, the self-regulatory organization approved by Switzerland’s independent financial-markets regulator, FINMA. The Utrust platform went live in 2019 when football club S.L. Benfica came on board as the first merchant and the first major European football club to accept cryptocurrency. Utrust has since added Phone House Portugal to its growing list of merchants.