Crypto market in pursuit of security and reliability

Fundamental Analysis:

Bitcoin along with other crypto-currencies is going through a very strained period as it seems. As the time progresses more and more issues are looking to bring out the negative side of the digital market instead of embracing it.

The latest negative news, are coming from the Asian continent and more directly the South Korean crypto exchange Coinrail was undergone a cyberattack during the past weekend. In a more simple tone, a digital robbery was confirmed by Coinrail as well as an amount around $30 million worth of lesser-known cryptocurrencies. This negative event, digs deeper in investors’ fears dealing with the digital market reliability and it repels the smooth operation these exchanges boast about, leaving them vulnerable to further harmful publicity. Even though insurance could come into play and should be enacted as this is not the first time cyber-attacks have taken place, the issue still remains unresolved and more work has to be put in the industry to protect investors and companies .

The abovementioned event, hurt Bitcoins price which followed with a steep drop dragging along its path other crypto’s like Ripple, Ethereum, and Litecoin. The drop acted like a blow to the head for investors which chose to cut their crypto holding, erasing almost $50 billion from the market since Friday.

In the US, Government investigators requested complete trading data from various bitcoin exchanges in order to form a complete investigation regarding crypto price manipulation. Bitcoin futures were made available for trading on CME Group Inc, some 6 months ago and this investigation was put in place in order to check if the prices of those instruments represent a fair and true value. CME Group Inc offered these crypto futures from prices received from four bitcoin exchanges Bitstamp, Coinbase, itBit and Kraken. Some of the pre mentioned exchanges refused to give the data requested, however later followed up and made the data available when limits to the request were set and smaller volume of data was asked for. CME’s regulator, the Commodity Futures Trading Commission was not satisfied as no agreement is in place to be able to retrieve this kind of data from price providers, when needed.

On another front, Apple Inc. has legally prohibited users of iPhones and iPads from mining digital currency on their devices. The company publicly noted that cryptocurrencies processing could be performed by cloud-based mining but not applications devices. Apple Inc assists Google’s decision made in April 2018, which very similarly does not allow in-browser mining of cryptos as these activities are contrary to their terms and conditions.

In addition, chairman and CEO of JPMorgan Chase Jamie Dimon while on a live interview on CNBC along with Warren Buffet, made it clear for bitcoin followers or investors to be aware.

It is our opinion that a solution can be found. However, market participants should be on the lookout as the industry’s inexperience could be exploited further and even bigger amounts than 30 M could be stolen.  Eventually governments and regulations could make the necessary changes to confirm security and reliability to market participants by identifying users or by finding a way to trace digital assets.


Technical Analysis:

Bitcoin fell 1.05% to $6,700 but remained just above lows seen over the weekend of 6,633.9.

It is current trading between our noted $6,700 resistance level and the $6,100 support level.

A break above $6,700 resistance level, however, will not only lead to an advancement to $7,120 resistance level but also signal a reversal of the downtrend from the May 5 high of $9,948.98.

If the bears dominate the market Bitcoin could have downward movement break below $6,100 Support level and could aim for the $5,700 Support barrier.

Better regulation and more recognition could be the way forward (Bitcoin)

Fundamental Analysis:

The past week has been quite eventful for the crypto-currency market on both sparking new hopes about the crypto-market as well as new disappointments.

The latest headlines sparking hope for the crypto-market could be that an asset manager and a block-chain company plan to launch a security which will be linked to Bitcoin. The novelty is that, if they succeed, they would have created an investment product which would be traded as easily as stocks. Specifically, Van Eck Associates Corp. and SolidX Partners Inc. filed a request to list a Bitcoin-linked ETP to the US Securities and Exchange Commission on Wednesday. The fund is to be physically backed by holding actual bitcoins and is to be insured against loss or theft of the crypto-currency, as stated by the firms. Should the two firms be successful we could be witnessing the trading of crypto’s in another level, approachable maybe by a wider investor base. Such news could support Bitcoin primarily, as the prementioned investment product will be backed by Bitcoins, but could also serve in a wider recognition of the crypto-market.

In another turn of events in Korea, a District Court ruling not to confiscate Bitcoins because they are in the form of electronic files without physical entities, was repealed by the South Korean Supreme court. In its reasoning the Supreme Court stated that Bitcoin is intangible and comes in the form of digitized files, but it is traded on an exchange and can be used to buy goods. Therefore, receiving Bitcoins is an act of taking profits. The importance of the Supreme Court’s ruling centers around two points:

-It sets a precedent,

-It recognizes that digital assets such as crypto-currencies, do have real world value.

However, there are two sides of the ruling. The one which practically assists further to the adoption of Bitcoin, as a new legal recognition took place and the other that digital assets could be seized by courts.

As last, we reserved some comments made by Bank of England Governor Mark Carney. Specifically on the sidelines of the meeting of the G7 finance ministers in Canada, Carney stated that better protection for investors in crypto-currencies such as bitcoin were required and that it would be on the agenda of the regulators meeting. Also it was mentioned that British regulators were working on a report on regulations for crypto’s and that the report is due later this year. Please be advised that Mr. Carney had previously said that crypto’s are a poor alternative to existing central bank payment systems, however the underlying technologies may have valuable applications.

Summing it all up, as time progresses we might see more and more recognition for the crypto market but at the same time more regulation, which is not necessarily a bad idea considering all the scams which have surfaced overtime in the crypto-market. Bitcoin and other crypto’s may depreciate somewhat in the future but their existence seems more certain than before.


Technical Analysis:

Bitcoin seems to be the trend setter for a number of crypto currencies hence we selected it for our technical analysis.

The crypto has been trading in a sideways manner for the past week, with the majority of the prices being between the 7315 support line and the 7690 resistance line. The RSI indicator in the 4 hour chart seems to indicate a rather indecisive market  for the past week, remaining near the reading of 50. Overall, we would not share opinions about the bulls being back in the market currently. We could share the view that the current trend is for a sideways movement between the prementioned boundaries and currently see the case for Bitcoin to continue to trade in that manner for the next few days maybe with some bullish tones.  For our opinion to change we would require a clear breaking of the prementioned levels.

However should the Bulls take the reins we could see the price of Bitcoin breaking the 7690 resistance level and aiming for the 7890 resistance hurdle.

On the other hand should the bears be in the driver’s seat we could see the crypto driving south breaking the 7315 support line and aim for the 7000 support barrier once more.

Cryptocurrencies regulation to support or to tumble prices?

Fundamental Analysis:

Financial market participants and followers associated with Cryptocurrencies, are requesting regulations in order to protect their interests but most importantly to add further transparency to the market.

In Australia and New York State actions have already been taken and now Canada is also getting ready to follow up as the blossoming industry becomes increasingly mainstream. During mid-May, the European Union set an agreement in place for cryptocurrency exchanges to identify users in order to boost bitcoin’s legitimacy and to prevent criminals from taking advantage by moving money around the world. Though, the problem is not resolved as all the continents must synchronize the regulation activities in order to create a global regulation system on Crypto’s. Abusers can choose to use the most appropriate country with low barriers of regulation and carry out criminal or foul activities effortlessly.

Legislation targeting virtual-currency exchanges was introduced back in 2014, though those rules have yet to come into effect. Currently, the issue remains and exchanges that belong to the “money services business” are left unregulated and the people investing money in these industries are seemingly unprotected from many scams and fake websites that are surging the Internet.

Furthermore, the digital coin market could be sensitive to negative comments coming from various acclaimed figures within the global financial community as these could be harmful to the perception of the world regarding the credibility of the digital coin industry.  All these established figures do create volatility speaking in public. In our opinion, investors should be able to create their own views on decisions.

May has been a volatile month for cryptocurrencies, but most notable is the overall downward trend in prices though can also be viewed positively as it creates opportunities.

Investors are seen to believe in the power of block chain, the technology behind Bitcoin and other digital assets. In our opinion, investments could increase as numbers confirm that daily volatility on Crypto’s has increased in 2018 and is forecasted to rise even further.  Blockchain allows people to communicate their transactions more efficiently and more countries are now utilizing it.

As a conclusion, we believe Crypto Currencies are undergoing a difficult period with a lot of criticism against them and subsequently entering a sell off. On the other hand, presently, we are seeing many countries opening crypto currency exchanges indicating that people could be interested in the digital market. However, whether crypto-currencies and the technology that powers them will reshape the financial system remains to be seen, but control from regulatory bodies could help stabilize the crypto currencies aggressive movements and negative outlook.

Technical Analysis: