This Week in Bitcoin: Black Swans
It would be an unusual week in bitcoin exactly where there weren’t glum tidings to report, be it an exchange hack, regulatory clampdown, or edict from the east. It just so happens that this week witnessed all 3 – and on the same day, no significantly less. You could contact it bad luck, or you could contact the occasion, which sent bitcoin under $9,000, exactly where it is flirted ever considering that, a black swan: a random occurrence that is impossible to predict.
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They say that bad luck comes in threes, and on Wednesday bitcoin was struck by a triple whammy which sent prices tumbling. This perfect storm of unfavorable news came in the kind of an SEC statement on unregulated exchanges, reports of Japanese regulators shutting down exchanges, and a significant incident at Binance in which compromised user accounts had been utilized to manipulate the cost of viacoin. As is typically the case, these stories had been not as gloomy as the marketplace initially interpreted them.
The SEC has been bumping its gums about crypto for weeks, as regulators are wont to do, and there was nothing at all in its most recent report which heralded impending doom for cryptocurrency exchanges. Similarly, it turns out that the Japanese watchdog wasn’t wielding the banhammer indiscriminately rather it was focusing on a couple of small, unlicensed exchanges whose existence has little bearing on the nation’s cryptocurrency trade. Lastly, the Binance incident ended happily, with the fraudulent trades reset and balances restored. Not only did the attackers fail to profit, but they in fact wound up losing out on the scam.
Regulatory stories have dominated the news cycle when once more, and most of them were American. The tone coming from the west versus that from the east has been tangibly various. This week alone, Asia has brought us news of a South Korean travel internet site accepting a dozen cryptos as payment and a Taiwanese airline following suit. When was the last time we had a main U.S. or European retailer announce support for bitcoin? Instead of merchant adoption, all we look to hear is pronouncements on how ICOs are liable for class action lawsuits and cryptocurrencies are commodities. But what about all the great things bitcoin did?
In fairness to regulators, they’re just carrying out their job, even if their overzealousness is causing investors to turn into much more confused than ever about what specifically they’re buying into. The truth is, officials from competing agencies do not know what to make of crypto, and till they can multilaterally reach a consensus, perhaps they should refrain from issuing contradictory decrees.
One of this week’s more well-known stories concerned Paypal filing an “expedited cryptocurrency transaction system”. We’re starting to see this sort of thing a lot: “enemies” of bitcoin filing bitcoin-like patents as a implies of hedging their bets and staying relevant. It is no coincidence that Paypal shares jumped 5% off the news. Whatever the payment processing company are plotting, a proprietary cryptocurrency appears unlikely at this stage, with CEO Dan Schulman declaring, in a recent speak:
Regulations need to be sorted out and a whole number of other things. [Crypto is] an experiment correct now that is quite unclear which direction it will go.
One experiment which didn’t go down well was the selection of Mt Gox’ creditor to dump a ton of BTC onto exchanges. The coins had been liquidated more than a period of a number of months, but in every case their release brought on the value of bitcoin to drop, such was the volume of coins becoming sold at marketplace costs. As a consequence, some of Gox’ original victims discovered themselves rekt again following their lengthy positions had been suddenly wiped out. Why couldn’t the coins have been sold in an OTC deal? It is a query that numerous individuals, which includes Kraken CEO Jesse Powell, have been wondering.
In those weeks where bitcoin, alts, and every single other crypto asset is acquiring pummeled to death, any light relief is gratefully received. It came from the story of decentralized banking ICO Miroskii and its intriguing project team, led by Ryan Gosling. That, and the story of Bitcoin.org co-owner Cobra, who was accused of switching sides after declaring his support for bitcoin cash, have been the closest we got to humor – unless you count the shocking overall performance of Chinese shitcoins, which is only funny if you are not holding Asian alt bags.
This is crypto, so who knows what next week’s gonna bring, but if we had to wager a few satoshis, we’d say regulation, far more regulation, and one more bearish statement from the SEC. Only Silk Road little ones will keep in mind this, but there was as soon as a time when the only issue officials have been receiving hot and bothered more than was the possibility of bitcoin becoming employed to buy drugs. How time flies and priorities change.
What was your preferred story from this week in bitcoin? Let us know in the comments section beneath.
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Published at Mon, 12 Mar 2018 09:55:03 +0000