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Podcast | Editor & # 39; s Pick: Bitcoin: a cryptic story

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Financial analysts have launched alarm bells on the dangers that cryptocurrencies could trigger for some time while Jay Clayton, the president of the Securities and Exchange Commission (SEC) of the United States recently added some perspective to the hubbub around the controversial cryptocurrency that it's Bitcoin. He said recently and we quote, "Bitcoin does not have the attributes of a security". End of the quote.

Daniel Roberts, senior writer of Yahoo Finance, cited it on November 28, 2018 in one piece, and another story in express.co.uk took on a more grim tone since the world's "biggest digital asset", Bitcoin, had hit its lowest value since September 2017 this month and now it scares the fears that it might be more vulnerable to hacking by cybercriminals.

So yes, a tremor is happening even as we speak.

This is Seetal and in today's Moneycontrol podcast, we will be tracing the history of Bitcoin and its recent dramatic turns.

Many sides of the coin

But back to Clayton and his commentary on Bitcoin with which we opened this podcast, this is how he made his statement in the piece of Yahoo.Finance, "A resource like Bitcoin, where it's designed to be a replacement for the sovereign currencies, we "I have established that it does not have the attributes of a security, as far as I am concerned it is designed to be similar to the dollar, the yen, the euro and it works like this: the people who buy it expect that operate this way. "Unquote.

His statement states that the piece has made krypton people happy because of the obvious crackdown the SEC has exercised on companies that have led ICO (initial money offerings) or "token sales", considering that these sales were offers of unrecorded securities. We quote, "Big Bitin believers would generally prefer less SEC space regulations, not more, and if the SEC does not consider Bitcoin to be a security, then it is not under its jurisdiction." End of the quote.

The writer, however, differs from Clayton and does not think that Bitcoin is similar to the dollar, the yen or the euro or that it works in this way.

We quote, "Bitcoin's first vision as a currency and a legitimate alternative to legal currency has not really developed, but many see Bitcoin as a store of value (" digital gold "), many see it as if they had a killer use case in emerging markets where people are underpaid or non-budget and need an easier way to get paid, and many institutions see the potential in blockchain, the technology of the distributed ledger that is at the base of Bitcoin, they are still few and far between ". End of the quote.

Sam Stevenson in express.co.uk, however, was more concerned with the fall in the recent decline in the value of Bitcoin.

We quote, "BTC collapsed in mid-November, falling below $ 4,000 (£ 3,123) for the first time in 2018, according to CoinMarketCap." The collapse in prices has led cryptocurrency commentators to declare that the market is more susceptible to 39; hacking. .Co.uk, industry experts have also raised the question of the need for greater regulation within the cryptographic sphere.

Paolo Passeri, architect of global solutions at Netskope, argued that the collapse of the cost of encryption at the market level was the "catalyst" and the driving force of a recent peak in the scams of cybercrime hackers. "Unquote.

The crypto-aficionado in the piece explained that the reason for the encouraged attitude of cybercriminals was the fact that the incident made "encryption" less profitable.

He said: "The catalyst that drives cybercriminals looking for new types of attacks is the decline in cryptocurrency prices, as this has made encryption a much less valuable means of obtaining the currency due to the energy costs involved.

While price volatility continues, hackers aim to capitalize on the victims who took advantage of the recent price bubble without spending too many resources to achieve their goals. "Unquote.

The point is that hackers seek loopholes and constantly reinvent the ploys to steal cryptocurrency, as in the recent example of SIM Swapping used to steal $ 1 million (£ 784.7000) in digital resources from a Silicon Valley business man.

The cybercriminal was the 21-year-old Nicholas Truglia, who, according to the piece, personified the business man by obtaining a new SIM from the victim's operator, and then used the new number to go through phone-based authentication that provided access to cryptographic portfolios.

The piece also quotes the economist Dr. Saifedean Ammous who tweeted: "This bear market is a test for the security model of Bitcoin: if the price continues to fall while the chip makers continue to progress in the production of energy of cheaper processing, the Bitcoin attack becomes progressively cheaper. " Unquote.

How serious are the implications?

Peter Tchir, a Forbes contributor was almost brutal if we went to the title of his piece published this month.

"Bitcoin – Stick A Fork In It – It's Done", is, you'll agree, a real punch line to start a piece with.

But the intent of the piece was to inform, not to shock. A hard fork is in fact a term that refers to the blockchain technology and represents a radical modification of the protocol that makes valid previously valid blocks / transactions (or vice versa). This requires that all nodes or users upgrade to the latest version of the protocol software.

Let's quote from the piece: "Starting November 15, Bitcoin Cash had a fork that briefly led to the creation of Bitcoin SV (SV stands for Satoshi Version) and Bitcoin Cash ABC Bitcoin Cash dropped from $ 511 on November 13 to $ 212 on November 23 (according to Bloomberg) Bitcoin SV which was $ 55 on November 23 (according to CooMarketCap) creating a combined value of less than $ 270 (Bitcoin Cash holders received 1 Bitcoin SV for every Bitcoin Cash they had at the time of the fork) Bitcoin Cash was briefly valued at $ 227.04 before the main CoinMarketCap price aggregator combined the prices into a single issue. "End of the quote.

Even if you can not make sense of the twisted vicissitudes mentioned in the previous statement, just know that while Bitcoin was not affected by this fork, it dropped from $ 6280 on November 14 to $ 3,800 on November 26th and were also repercussions because the fork has triggered a wave of sales on all cryptocurrencies.

We quote, "The last price drop has made many other already embarrassing Thanksgiving conversations even more embarrassing.It is not a total coincidence that the Bitcoin meteoric rise to nearly $ 19,000 in December 2017 has started before Thanksgiving American when college students returned home and explained the potential investment for family and friends on how to buy it and why they needed to buy it. Bitcoin futures should also be launched, giving the Bullcoin one more reason to be bullish.

Starting now, with Bitcoin under $ 3,800 you had to have bought Bitcoin before October 2017 to make a profit. A year is a long time to have anyone who has purchased an asset have losses (in US dollars). It certainly makes potential investors who have been largely attracted by the fear-losing encryption (FOMO) very reluctant to bind to Bitcoin or any cryptocurrency. "Unquote.

The reason for the decline

Peter Tchir believes in Bitcoin and the entire cryptocurrency space is too confusing for many potential investors. We quote, "These forks that have occurred and the variety of cryptocurrencies confuse too many potential investors. In my Bloomberg terminal, there is a Cryptcurrency Monitor showing Bitcoin, Bitcoin Cash, Dash, EOS, Ethereum, Ethereum Classic, Litecoin, Monero, XRP and Zcash Which one to choose? Which will win? How many random investors will do the work to make this decision? The cryptocurrencies, which I think strongly depend on the new users who adopt it, frighten investors who think that critical mass will be a key to continuous success. "End of the quote.

Adding to the confusion is "decentralization" or lack of centralized control because, as the text states, "decentralization facilitates the creation of forks and the creation of new cryptocurrencies, adding to the choices and confusion for many. created their fake cryptocurrency to show how easy it is: these forks and new products decrease the power of the original Bitcoin and all cryptocurrencies, as greedy investors also have difficulty keeping up, not to mention someone looking for Immerse yourself in water Sometimes "choice" is not a good thing because it is a sign to many, that the market is too fragmented and too easily divided to reach the full potential of many crypts. " End of the quote.

Things can be better?

The piece suggests that if Bitcoin itself (or a part or all of the cryptocurrencies) can start trading higher and recover much of the lost momentum, people would worry again. We could see a return of FOMO that could see another wave of new users "forced" to the market. We quote the writer, "I'm not sure how to recover the traction that Bitcoin and cryptocurrencies have had last year. Bitcoins and cryptocurrencies in general have lost their brilliance, in part because they seem to offer increasingly confusing choices, rather than exploit investors. question and understanding. "End of the quotation.

Mixed signals

Along with many portals and financial observers, CCN also feverishly reported the value of Bitcoin (BTC) that rose from $ 4,065 to $ 3,600, reversing a short-term corrective rally.

We quote: "The dominant cryptocurrency has been falling sharply for several weeks, but on November 26, for a short period of time, Bitcoin seemed to begin a corrective rally after reaching a new annual low of around $ 3,400. he spiked to $ 4,000, with a price increase of 17% over a 24-hour period, but the price of the asset began to fall to the lower region by $ 3,000. "End of the quote.

And understandably, asks the piece, "What is Bitcoin?"

The explanation is simple. The cryptocurrency market, says the piece, is struggling to support every kind of impulse in an attempt to create a trend reversal. Sales pressure on major digital assets is on the rise and purchasing pressure is falling, which has led both Bitcoin and Ethereum to lose more than 40% in the last two weeks.

We quote: "When the price of an asset falls substantially without a huge volume spike, it represents a free fall without much selling pressure, which means that large volumes of sales start to hit the market, the price of the asset may be vulnerable to further sale in the near future. "End of the quote.

We leave you with a statement from Alex Krüger, a cryptocurrency trader and economist, "Before the BTC incident had grown exponentially. The BTC could ever resume exponential growth? Maybe not … Maybe just temporarily. Many resources do not grow up. exponentially Bitcoin has matured and starts behaving like a currency or most commodities? "Unquote.

The "What it" is an interesting touch. Leave the answers open ended because in the end the cryptocurrencies are not even predictable. Just like those who invest their faith in their intangible charm. The story of Bitcoin is obviously one with many possibilities.

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