Can social conversation dictate the performance of cryptocurrency and why fraud is a problem? The Tradefair team brings you the latest roundup of cryptocurrencies …
"Statistics show that opportunistic scammers are taking advantage of this market by offering investments in cryptocurrencies and using every trick in the book to defraud the unsuspecting victims. "
– Pauline Smith, director of Action Fraud.
The investment in cryptocurrency remains an endless game of two halves. Just when investors think they understand, another peak or fall reminds them that they have nothing of the kind. While this holds the most reserved away from trading, it is what attracts others – who love the added risk element -.
Here are some of the latest stories that emerge from the world of cryptocurrency:
The former Facebook Exec moves away from the Coinbase board
David Marcus, # 39; former head of Facebook Messenger who now leads a group focused on blockchain to the social media giant, announced that he will resign from the board of directors of the Coinbase cryptocurrency trading platform.
Luck suggests that the move is the result of Facebook having "continuous and serious" blockchain ambitions, which could include the launch of its cryptocurrency. However, according to the same social media giant, it is a precautionary action to "avoid the appearance of a conflict" between the two roles of Marcus.
Reports have claimed that Facebook has tried to integrate financial data into its platform, which would be a clear sign that the social media giant is trying to expand into finance and e-commerce . However, given the recent Facebook data scandal, it could be an alarming prospect for many
Crypto fraud on the rise
City of London Police reported an increase in cryptocurrency fraud, according to the Financial Times. The force warned of the threat after more than 200 people admitted having lost more than 10,000 pounds in two months through scams.
The figures from the action fraud cited by the British police found that the victims lost 2.1 million pounds through fraudulent schemes. The largely unregulated nature of cryptocurrency has led the market to be used for criminal activities, such as money laundering, and is part of why authorities are subjected to this pressure to implement the rules.
Action management fraud Pauline Smith said: "The statistics show that opportunistic fraudsters are taking advantage of this market by offering investments in cryptocurrencies and using every trick in the book to defraud the unsuspecting victims."
The City of London police launched the first cryptocurrency course in the UK to help officers be better prepared to "recognize and manage cryptocurrencies in their investigations".
What causes cryptocurrency fluctuations?
A recent Telegraph report tried to explain why the cryptocurrency market is so prone to dramatic fluctuations. Citing the data from the new Pulsar social currency report, he analyzed how people view cryptocurrencies as a whole.
The analysis found that the anonymity of cryptocurrencies remains one of its major attractions, especially in the mainstream, but that fraudulent contravention continues to discourage many from making significant investments.
But what causes sudden ups and downs? The Pulsar report found that the success of the value of cryptocurrency is related to public sentiment. This means that social conversation could be used to predict future changes in the market, adding an element of predictability for traders.
Investopedia's analysis is linked to this, naming the first eight reasons why bitcoin is so volatile, which included: bad press, fluctuating perceived value security breaches and high profile losses .