The price of bitcoin slid below $6,000 on Friday, hitting a new low for 2018.

CoinDesk’s Bitcoin Price Index (BPI) fell to $5,938.18 at 21:51 UTC, surpassing the prior low of $5,947, which occurred on February 6.

Bitcoin

As of press time, that figure had risen above that low, with the price of bitcoin averaging $5,977.02, BPI data indicates. All told, the price of bitcoin has declined more than $700 since the start of the day’s trading.

The cryptocurrency’s market capitalization has also dipped, sliding to $102 billion – its lowest of the year – according to the BPI.

As analysis previously suggested, market bears may be back in force following the recent push above $6,700. CoinDesk’s Omkar Godbole wrote earlier Friday that earlier technical charts showed the potential for a drop below $6,000.

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The price of bitcoin on Friday fell to a level last seen in early February when it registered its lowest price in 2018.

Prices went as low as $6,081.09, according to CoinDesk’s Bitcoin Price Index (BPI), a significant drop considering the day’s opening price of $6,717.20.

Bitcoin

At press time, bitcoin’s price – currently hovering at around $6,226 – is down more than 60 percent from the 2018 high of $19,783 set in January.

Other cryptocurrencies are following suit as bitcoin continues to flirt with support levels, as shown in data published by sources like OnChainFX.

Litecoin, for example – the world’s sixth largest cryptocurrency by market cap – hit its lowest level in 7 months on Friday. The price of ether currently at about $479, roughly 60 percent from its all-time high in December 2017.

As it stands, the overall cryptocurrency market cap is $259 billion, down from its high of $813 billion, according to CoinMarketCap.

Other indicators similarly depict the state of the market as it stands today.

The Relative Strength Index (RSI), a popular momentum indicator, demonstrates a weekly value of 41 according to Bitfinex exchange data, a level that was last seen in September 2015.

Compared to bitcoin’s lowest weekly RSI level (27) for the prolonged bear market in 2014, current levels show scope for significant additional depreciation.

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The price of bitcoin, the world’s leading cryptocurrency by market capitalization, surged $400 during a two-hour period on Monday while more than 26,000 coins traded hands.

The seemingly bearish day opened with a price of $6,443 that quickly fell to $6,338, according to CoinDesk’s Bitcoin Price Index (BPI), forming what looked to be a bearish pennant breakdown.

Bitcoin

That price action was trapped in the pennant for the past couple days while remaining inside a larger descending channel since the beginning of May – both of which have since been breached.

Perhaps not coincidentally, around 12:30 EST – when it was announced digital payments firm Square had been granted a Bitlicense by New York regulators – bitcoin prices surged nearly 7 percent to hit a daily high $6,793 while the total cryptocurrency market capitalization increased roughly $13 billion, according to CoinMarketCap.

As of press time, the price of BTC has leveled off to $6,726 on the Bitfinex exchange due to overbought RSI conditions on the shorter term time frames and price coming in contact with troublesome resistance.

The 12-day exponential moving average recently joined resistance from June 11th in the $6800 area, according to data from Bitfinex, which will not be an easy task for BTC to penetrate without consistent bullish volume.

While the current inflow of BTC trading volume is encouraging, bulls were teased by a false breakout from the descending channel on June 3rd, signaling that it might be wise for them to proceed with caution.

Since BTC tends to lead the pack of other major cryptocurrencies, the likes of ether (ETH), litecoin (LTC) and bitcoin cash (BCH) have also performed well against the US dollar today, reporting at least 4 percent gains across the board.

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The price of bitcoin, the world’s largest cryptocurrency by market capitalization, fell to its lowest point since April 1 on Tuesday.

Bitcoin’s value slid to $6,455.92 during the afternoon trading session, dropping more than $280 in the span of two hours, according to data from CoinDesk’s Bitcoin Price Index. This represents the lowest figure since the start of April when the BPI registered a low of $6,443.

Bitcoin

The charts suggest a support of $6436 – if current levels are broken, the next major support is $6000, borne from the lows from early February of this year.

As of press time, the BPI is reporting a price of $6,523.86.

As of press time, bitcoin is down 5.82 percent in the last 24 hours. Further, on a year-to-date basis, bitcoin is reporting a 60 percent depreciation overall.

Tuesday’s session saw downward developments for other major cryptocurrencies as well. For instance, litecoin, the world’s 6th largest cryptocurrency by market capitalization, is now approaching $98 – a price not seen since December of last year.

EOS is also down 12% on the day, representing a total decline of 34% since June 4th.

Meanwhile, the total market capitalization of all cryptocurrencies is just over $280 billion, according to data published by CoinMarketCap.

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The price of bitcoin hit a two-month low over the weekend – and social media is alight with speculation about it.

While pundits don’t quite agree on the circumstances behind the plunge (with some blaming reports of a widening manipulation crackdown, the hack of South Korean crypto exchange Coinrail or just some pre-week selling), what’s clear is that the price move has acted as a kind of social thunderbolt for the community, spurring commentary from all sides.

Bitcoin

Investor Alistair Milne ran a Twitter poll on Sunday soliciting input on what people thought sparked the dip – in perhaps a sign of the times, half of the roughly 3,700 respondents blamed “aliens” with 9 percent and 12 percent blaming the Coinrail hack and the CFTC subpoenas, respectively.

And as another observer pointed out, it’s not just bitcoin that felt the heat this weekend – many of the world’s largest cryptocurrencies by market capitalization saw downward price moves.

Richard Heart asked his followers on Sunday:

Light-hearted take

The efforts at levity amidst the market tumble were seen elsewhere. For example, investor-focused social network StockTwits tried to encapsulate what some traders are likely feeling – in gif form, that is.

And cryptocurrency reporter Joseph Young contrasted the viewpoints of an office worker on Monday eager for Friday to arrive with a crypto trader going through the price headwinds.

Glass half full?

Not all those in the trader community are looking at the situation as an entirely negative one or a reason to remain bearish.

Indeed, some observers are still calling for the “moon” – even though this weekend’s price moves may slow that process a bit.

And others, according to today’s social media churn, are already looking toward greener pastures:

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Bitcoin looks primed for a move to $8,000, but low trading volumes point to the risk of a bull trap.

The cryptocurrency broke through a key descending trendline (drawn through the May 6 high to the May 21 high) on Sunday, adding credence to last Tuesday’s bullish outside-day candle and signaling a short-term bearish-to-bullish trend change.

Bitcoin

However, at the same time, daily trading volume fell 1.77 percent to $4.85 billion, according to CoinMarketCap. Further, rolling 24-hour trading volume currently stands at $4.95 billion – down 22.5 percent from the current quarterly average of $6.38 billion.

Low volume is a cause for concern for the bulls, as it is widely considered a sign that the market is approaching a peak; that is, the rally will be short-lived.

Hence, a slight pullback seen today does not come as a surprise. At time of writing, the cryptocurrency is trading at $7,591 on Bitfinex – down 2 percent from the previous day’s (UTC) close of $7,718.

Daily chart

The bullish outside-day candle followed by a bullish crossover between the 5-day and 10-day moving averages (MAs), and an upside break of the falling trendline, indicate scope for a rally to $8,000.

However, the decline in trading volume over the last seven days puts a question market on the sustainability of the corrective rally from $7,040 (May 29 low) to $7,779 (Sunday’s high).

4-hour chart

On the 4-hour chart, trading volume has picked up as prices fell back to $7,549 from the high of $7,764.

The anemic trading volume during the price rally and the later increase in trading volume during negative price action indicates a high probability of a downside break of the rising wedge pattern. In such a case, bitcoin risks falling back to last week’s low of $7,040.

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The upside break of the falling trendline has opened the doors for a rise to $8,000. However, low volumes may indicate a false breakout.
A downside break of the rising wedge seen in the 4-hour chart would allow a drop to $7,040.
Only a high-volume break above $7,700 could yield a sustainable rally to $8,000.

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“Yes, we have created an attack framework for the lightning network.”

The message from “bitPico” to CoinDesk confirmed what many had read in a popular chat group, that the pseudonymous user was flooding nodes running the software with traffic with an automated “attack toolkit.”

Bitcoin

Around the same time, a handful of developers reported lightning nodes crashing, temporarily stopping them from sending payments using the technology designed for faster, cheaper bitcoin transactions.

The development comes as more and more users have started using lightning network to send real payments – albeit with some bumps along the way – and just a couple weeks after Lightning Labs, one of several startups building open-source lightning implementations, was the first to launch its product into live beta.

The attacks were a strange incident in that user funds were safe and money wasn’t being stolen. In fact, those, including bitPico, who are attacking the network might even be losing money.

One of the first to notice the attacks, Bitrefill developer Justin Camarena, was able to fix his company’s node – and easily.

But he was confused as to why anyone would attack other lightning nodes without the lure of monetary gain. He wondered why they wouldn’t just report any issues on GitHub, so developers could fix any bugs found.

“[It] wasn’t really an attack to steal funds, but to make a statement in my opinion,” Camarena told CoinDesk.

At first, many had the same impression, since bitPico had been a vocal supporter of a controversial scaling initiative, and had continued to espouse the benefits of increasing the block size parameter, even after most network participants ditched the effort.

But, according to bitPico, the attacks aren’t just more politics; they’re all about safety:

“As people with investment into bitcoin, we want to make sure layer-two solutions do not get [zero-day’ed] out of the gate; trying as many attacks as possible is the only way to make sure.”

Zero-day vulnerabilities are security holes that aren’t known to developers of a project. Usually, they are exploited by hackers in the hopes of stealing data before the vulnerability is patched.

But bitPico’s attacks, which started about 10 days ago, are all about stress-testing the software before more people start using it. And bitPico’s plan seems to be working – to a degree.

According to bitPico, 22 different attack vectors have been found, and the pseudonymous user plans to continue the attacks for another couple of weeks.

A common annoyance

It’s worth pointing out that denial-of-service (DoS) attacks are common across the internet.

These attacks simply drown a server with so much traffic that they crash under the load. And because these are a common practice among attackers, websites will generally develop armor to protect against them.

Indeed, bitPico’s attacks are prompting lightning developers to do just that, putting forward various possible fixes. And many developers believe these current attacks will set the lightning network up for success.

For instance, bitcoin advocate and author Andreas Antonopoulos blithely called the attacks “free testing,” while some developers just laughed them off.

“Frankly that’s to be expected for any service that is exposed to the internet and [it] doesn’t qualify as a real attack in my view,” said Pierre-Marie Padiou, CEO of ACINQ, a French startup behind another lightning client.

Developer Alex Bosworth has started using firewall software, called iptables, to prevent this traffic from disrupting legitimate transactions.

But the attacks are ongoing, propagated by users like bitPico opening tiny payment channels – which they have to pay a fee for opening. (This is one way attackers are probably losing money in DoSing the network – though it costs less than a penny to do so.)

This is a problem in that the Lightning Labs client, for one, doesn’t yet allow nodes to disconnect from these spammy channels, thus slowing them down.

In the future, Bosworth hopes the Lightning Labs implementation will allow users to disconnect from suspect peers.

Still, the attacks are merely what Bosworth and Camerena call an “annoyance.” “They wasted their fee to make that channel. It’s just bugging me,” Bosworth said.

Accidents, not attacks

All this goes to show that while the lightning network is ready for real money for the first time – a big step, to be sure – there’s still a number of smaller issues that need to be resolved before it will be ready for everyday, non-technical users.

This was on full display in another scenario recently: what developers initially thought was an attack, then turned out to be a simple mistake.

A little over a week ago, Bosworth tweeted that an “attacker” has broadcast an old “channel state,” which could have allowed the user to effectively steal another user’s funds.

Toward that, Bosworth tweeted, “Lightning DoSers seem organized and motivated.”

But the network’s rules worked as programmed, penalizing the user $25-worth of bitcoin instead.

“Justice has been served,” Camarena tweeted at the time, after seeing the message the program spits out when a bad actor tries to steal money by broadcasting an old transaction.

“That is exactly how it should respond. That was pretty interesting to see it play out for real,” Bosworth told CoinDesk.

Yet, while the revocation process worked, it also displayed that there are still more tweaks needed, as the software shouldn’t have let the user send old data in the first place.

As it turned out, broadcasting the old data was an accident on the part of a user with a corrupted channel database, who restored an old backup and closed his channels. When the channels were closed, the old channel states were broadcast and the node he was connected to detected it and categorized it as fraud.

Nonetheless, lightning developers see these errors as good learning experiences that will ultimately bring about a tougher network.

As Bosworth tweeted:

“We’re getting a good opportunity to develop robust [peer-to-peer] deployment strategies.”

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Not yet out of beta, hundreds of developers around the world are already experimenting with bitcoin’s newest technology – the Lightning Network – donating time and resources to help lay the groundwork for a more scalable version of the oldest and largest cryptocurrency yet created.

So great has been the effort that there are now more than 1,000 lightning nodes estimated to be running the software on live computers, largely at a loss, but motivated by the greater gain of making the bitcoin network more accessible and affordable. Still, with the network entering its bootstrapping phase, some are beginning to question when the economics of scale may begin to bring new pressures.

Bitcoin

As the bitcoin community saw with the rise of cryptocurrency mining, in which at-home mining via PCs was quickly outpaced by industrial operations, profits attract corporate interests. And experts admit, it’s entirely possible that companies could make money by offering easy access to quick cryptocurrency payments.

“If an entity is going to put a lot of value into payment channels and operate the node for generating profit,” former BitGo engineer Jameson Lopp said. “Then it’s probably going to be similar to mining.”

Lopp’s argument is that all networks, no matter how grassroots at the start, eventually give way to specialists who are simply better at offering a more reliable services at a more affordable cost. In the case of Lightning, almost anyone with the technical skills and a little cryptocurrency can run Lightning channels, but offering a service in the future might be different.

For example, users of the network might not always be able to rely on the availability of others they’re sending money to, meaning intermediaries could emerge that offer services with better liquidity and payment routing.

“The [Lightning Network] will effectively centralize bitcoin with ‘channels’ and ‘hubs’ on the sidechains. These hubs will essentially function as banks,” a Twitter user going under the handle @marcotweetss said.

In many critics’ minds, institutions might offer so many of the biggest payment channels that they would essentially coalesce into “hubs.” That’s what Forbes and CoinDesk contributor Frances Coppola pointed out when she tweeted: “Lightning nodes are full-reserve banks, and the network is essentially a correspondent banking scheme.”

Beyond rogue volunteers, there’s also the involvement of companies such as Blockstream, ACINQ, and Lightning Labs, which have done a lot of the heavy-lifting related to the open-source Lightning Network software, and who, in the minds of critics, might be apt to play these roles.

These companies currently offer their services for free, even though they are venture-backed – Lightning Labs recently secured $2.5 million and Blockstream has raised $80 million so far – and as such, it’s believed they’ll eventually need to find a way to generate profits.

This business opportunity worries some cryptocurrency enthusiasts. After all, Silicon Valley startups from Facebook to Twitter have long perfected the model of getting users hooked on a free service, only to later embrace practices at scale that may not have the best interests of users in mind.

Yet, there are several reasons that, for the time being, there’s little need to worry.

Cooperative implementations 

For one, cheap access is emerging as a crucial difference between bitcoin’s blockchain and the Lightning Network.

In this way, MIT researcher Thaddeus Dryja, co-author of the original Lightning Network white paper and the former CTO of Lightning Labs, believes the network will avoid corporate centralization overall because of its design, which doesn’t require expensive or specialized hardware.

According to Dryja, users will be able to freely abandon institutional players that try to exert too much influence over individuals.

“Let’s say everyone is using Amazon, for example, and Amazon says we’ll also route payments between users,” Dryja said. “If that node starts doing things people don’t like, it’s very cheap to close it. They never have your money.”

Along those lines, Lightning app developer Elaine Ou, argues that the barrier to entry for providing the default software is low, meaning should one company embrace poor practices, alternatives could quickly arise.

“There are two other Lightning implementations in use already, so I’m not too worried about centralization. The specs are open and updated through an open process,” she said.

None of this is to say the Lightning Network is infallibly egalitarian. The system still favors players with technical and financial resources, since channels need to have money in order to facilitate transactions. Parties with a large amount of capital could offer network nodes with more liquidity.

Dryja told CoinDesk that institutional players will probably factor into this growing network, saying:

“Having more large nodes is more efficient. I think it will be exchanges becoming the dominant players, at least in the first few years, and that’s not great. It would be great if people were running nodes off of Raspberry Pis in their houses.”

That’s why Lightning Labs CEO Elizabeth Stark told CoinDesk that her team strives to make the technology collaborative yet distinct from any company, including her namesake startup, adding: “The Lightning Network specification is open and anyone can build a compatible implementation.”

Lightning developer Jack Mallers, who created the free Zap Lightning wallet, will soon release consumer applications for both mobile and desktop. Those interfaces will make it even easier for average people to use Lightning without relying on corporate channels.

Low barrier to entry

It’s entirely possible that inherent fees could make Lightning too expensive for average users to constantly open and close channels. But so far, this isn’t the case.

Unlike bitcoin mining, which requires a great deal of expensive electricity, it usually costs just a few cents to open a Lightning channel. A channel hosting over 100,000 transactions still costs less than $20 to operate.

“Competition is really high on the network and the barrier to entry is low,” Mallers said, pointing to the fact he’s already gotten 19 volunteer developers to help him build Zap.

He added:

“Similar to the way people have bitcoin wallets on their phone today, eventually what you’ll be able to do is you’ll have a Lightning node on an iPhone or desktop, and it will be contacting other full nodes on the network, totally separate from your machine, pinging it for information.”

In fact, the upcoming Zap interface is just one of several Lightning projects allowing users to run a Lightning node without piggybacking on more complex bitcoin or litecoin nodes. Amazon might someday be able to offer the most efficient nodes, but any tech-savvy person with a laptop or mobile device will be able to tap into its stream.

Thanks to something called a light client, those independent Lightning nodes can talk to other nodes to stay up to date on what is happening in the broader bitcoin network. There are already roughly 500 people participating in Zap group chats through platforms like Slack.

There are certainly tradeoffs. People with light clients won’t have all the blockchain data at their fingertips.

Regardless, this beginner-friendly option makes the lightning network remarkably different than cryptocurrency mining. As for companies like Lightning Labs and Blockstream, they have an economic incentive to avoid becoming legacy middlemen providers.

Reputations at stake

As for the allegations that one of these companies could become another Facebook, there’s reasons that this isn’t exactly likely, either.

Lightning Labs, for instance, benefits from cooperation with developers like Mallers and Ou, who aren’t on Stark’s payroll. For blockchain startups working on this open-source technology, their professional reputation relies on their perceived efforts to keep the bitcoin network mostly decentralized.

Corporate interests generally consolidate power and access, but the bitcoin community has proven it will combat such efforts, such as when a small group of people forked the bitcoin network to create bitcoin gold in an effort to curb industrial miners. Of course, the Lighting Network is much younger than bitcoin, and a split like that could have wider implications for the Lighting community.

If entrepreneurs want to continue spearheading Lightning development, they will have to avoid aligning themselves with any party seeking disproportionate influence.

“We don’t currently operate any Lightning nodes and that’s not part of our plan. We build infrastructure for other people to operate nodes and for the network as a whole,” Stark told CoinDesk.

Lightning Labs’ investor and BitGo CTO Ben Davenport echoed her sentiment, saying, “They are not going to monetize the protocol directly. But there are always opportunities for smart teams, who are early in an important space, to develop business models.”

Dryja told CoinDesk it’s still too early to say how this young technology will impact decentralization at large.

However, Mallers is optimistic because channel operators never take custody of user funds. Plus, anyone with the technical skills can actually choose the path their payments take. It will be easy for cypherpunks to avoid corporate channels. 

“You’re never reliant on any third party. You can even do configuration and choose which path you want to take,” Mallers said. “You can route around certain participants in the network if needed.”

Blockstream developer Rusty Russell believes Lightning’s community pendulum will swing back towards greater decentralization in the long run, and that the barrier to entry is the chief reason.

“It’s easier to accept Lightning payments than it is to accept on-chain [bitcoin] payments. So we’re seeing more people controlling their own payment infrastructure,” he said, adding:

“I think that will increase as we make the entire stack more usable, and it’s an excellent trend for the health of the ecosystem.”

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Developers of the most popular bitcoin implementation software have big dreams of crafting a truly global form of money, and as such, you can say they have a lot on their plates.

The breadth of their to-do lists was easy to see at a recent annual meeting in New York, where, in a change of pace from the internet channels they’re known to frequent, many of the software’s most-active developers come together to coordinate. In a conversation transcribed by contributor Bryan Bishop, they discussed a mish-mash of code priorities for the coming year, giving a peek into how the team makes decisions and the technical hurdles they hope to jump next.

Bitcoin

Though not all developers were in attendance, the transcript provides an inside look into the near-term focus of a few key developers, including long-time Bitcoin Core contributors Pieter Wuille, Matt Corallo and Cory Fields. It also provided a look behind the scenes, where contributors are toiling away on an array of changes to the code that now secures more than $147 billion.

Indeed, much of the conversation centered on touching up the way the team reviews and adds new code. One major pain point is that, while developers are submitting tons of code changes, there are only so many developers knowledgeable enough to battletest them for bugs, ensuring they’re ready to be added to the code securing so much money.

“As a reviewer, there’s no way I’m going to get through all of this and it’s actively discouraging,” one developer said.

Some code changes are even getting lost due to the load. Another developer even went so far as to call the growing list of proposed changes “a dead graveyard of cool ideas.”

Scattered priorities

Yet, this isn’t stopping developers from working on other new features.

Fields, a contributor at MIT, has long been working on sprucing up the peer-to-peer network code connecting all the nodes across the global network.

In an earlier interview with CoinDesk, he called bitcoin’s code a “monolithic blob” that developers have been trying to untangle since it was first put forth in 2009. Though he’s been combing through the code’s peer-to-peer layer for years, he revealed in the meeting that he’s “almost done.”

He’s also working on a feature building upon bitcoin’s unspent transaction outputs (UTXOs), the pool of bitcoin transaction data that can be spent in new transactions. Though his description of the new feature was thin, he said he plans to reveal more “soon” in an email to the popular bitcoin developer mailing list.

This goes to highlight the distributed nature of working on open-source code, where each developer works on whatever he or she chooses. Though developers are constantly chatting about their work on the internet, some might not have any idea that someone else is working on a big feature until they post it to a widely-read forum – such as the official mailing list.

Then there’s Wuille. Perhaps the best-known Bitcoin Core contributor, he’s responsible for SegWit, a much-lauded scaling code change that activated on bitcoin last year.

His update at the meeting was succinct, but he reiterated that he’s focused on another much-anticipated scaling change, signature aggregation. Plus, he’s looking at increasing privacy by hiding messages sent across the with “peer-to-peer” network – the very same layer Fields is tearing apart.

Corallo’s update was perhaps the most technical, describing in detail how he’s splitting up the codebase into chunks that are easier for developers to manage.

There’s one particularly messy piece that he describes as “super complex,” which more than one developer has tried to untangle. He’s not fazed by it though. “I want to take another shot,” he said.

Defending sovereignty

Corallo is one of many developers focused on making Bitcoin Core full nodes software easier for non-technical people to use. Though the code is widely-considered to offer the most secure way of using bitcoin, it’s notoriously difficult to set up, taking days or even weeks to download.

Chaincode co-founder and Bitcoin Core contributor Alex Morcos explained in the meeting why he believes it’s so important to make it easier to run.

Though there’s a “cultural push” to run nodes, Morcos said, he worries many users don’t understand the “real reason” to run one. He thinks it’s to be “sovereign,” or being able to tell if transactions are valid or not without trusting anyone else – basically the point of bitcoin in the first place.

Morcos put forward a few ideas for making this full-node-driven sovereignty possible for everyone.

Perhaps one of the biggest problems with bitcoin full nodes is the software is so large, smartphones can’t handle them. The software is kind of stuck in one place, with users likely to spin up the node on a computer permanently located at home or at a business.

But Morcos believes there’s a way around this. One day, users will hopefully be able to connect smartphones to the nodes running at home, boosting their security. “And then it’s ready to go wherever you go,” he said.

Along these lines, Corallo broached the idea of making it possible to check a full node for information about keys stored elsewhere – in a hardware wallet, for example, which is considered one of the securest ways of storing private keys. But, though this would make using the software more convenient, he’s been having trouble implementing it.

Morcos told CoinDesk that though he’s interested in these ideas, it isn’t his main focus right now. “I don’t know if I have a particular focus,” he said, succinctly summarizing the loose open-source code process.

But it does highlight that full node inconveniences are a pressing concern.

Morcos added:

“Certainly a goal is to make the time to get things set up and running as short as possible.”

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Bitcoin’s price fell sharply during trading on Wednesday, dropping more than $1,000 amid reports of exchange issues.

As of press time, CoinDesk’s Bitcoin Price Index (BPI) hit a low of $9,494.45 – representing a decline of more than $1,200 from the day’s opening price of $10,709.53. The sharp drop is notable, considering that the cryptocurrency’s price had risen above $10,800 earlier in the day.

Bitcoin

Bitcoin’s price has recovered from the low, trading around $9,714.35 as of time of writing. The drop followed a consistent decline, as previously reported, but the rate increased dramatically in the past couple of hours.

While it’s not entirely clear at this time what factors sparked the sell-off, the timing coincides with reports of unauthorized sells on cryptocurrency exchange Binance. The exchange has since suspended withdrawals, according to statements, with the situation coming less than a month after a prolonged system upgrade raised fears of a hack.

“We are investigating reports of some users having issues with their funds. Our team is aware and investigating the issue as we speak,” a representative wrote on Reddit Wednesday. “As of this moment, the only confirmed victims have registered API keys (to use with trading bots or otherwise). There is no evidence of the Binance platform being compromised.”

Similarly, cryptocurrency derivatives exchange BitMEX announced that some users were having difficulty logging into its platform and that it was investigating the issue. BitMEX later reported that it was back online, citing a spike in load as the underlying cause.

Market data indicates that other cryptocurrencies are experiencing price declines as well. With the exception of monero, all of the top-10 cryptocurrencies by market capitalization have fallen in excess of 10% in the past 24-hours, according to CoinMarketCap.

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Bitcoin mania is cooling off, and with it, changes are happening in its global market.

Indeed, the price furor that began in early November when talk that bitcoin futures listings would go live in the U.S. triggered a wave of speculation – bitcoin, which traded at $6,500 on Nov. 1, rose as high as $20,000 by mid-December – has all but faded. But while bitcoin has largely been stuck trading sideways, global volumes remain elevated, showing interest has remained strong.

Bitcoin

CoinDesk data reveals average daily trading volumes in February were up nearly 80 percent from November, rising to $8.2 billion, up from nearly $4.7 billion in November. (Month-over-month, volumes were down 40 percent from $13.4 billion in January.)

For traders seeking an edge, however, the biggest change was that the market’s so-called “kimchi premium” all but evaporated over the course of February’s 28 trading days.

Rising to prominence after it was cited by a sitting U.S. regulator in January, the term kimchi (after a staple Korean preserved food dish) referred to what was to many the dominant trend in the markets at the time, the higher bitcoin prices observed on South Korea’s exchanges.

As seen in the chart above, the spread – sometimes as high as 50 percent – briefly even turned negative in early February, meaning the Korean prices traded at a discount to prices on Western exchanges.

At the end of February, the price premium was roughly $400.

Premium turns discount 

But the term “kimchi premium” is also notable for what it says about market dynamics.

As bitcoin frenzy gripped South Korea last year, the spread between BTC prices on various exchanges started widening in November and December. At times, the dynamic even caused disruptions in the market that went beyond simply buying and selling.

For example, the divide prompted data source CoinMarketCap to exclude the Korean prices from the global average price calculation, which in turn caused markets to drop sharply as the change wasn’t widely communicated. 

CoinMarketCap appears to have since reinstated Korean prices in its global averages.

Yet another incident came when the South Korean government stepped-in to curb the excessive speculation. However, the drop in the premium does not mean the Koreans have done away with their fondness for cryptocurrencies.

Entering March, Korean exchanges continue to lead the way for bitcoin trading volumes, though the decline in the spread only indicates the government may have stamped out speculation.

Not just bitcoin

Still, the ‘kimchi premium’ affected more than just bitcoin’s market – other cryptocurrencies saw the same trend.

For instance, ethereum’s premium clocked a record high of 53 percent on Jan. 8, before falling to -5 percent on Feb. 3. (It is worth noting that among world’s biggest 15 exchanges, three are in South Korea. Further, of the five of the biggest ethereum exchange platforms, three are Korean.)

Litecoin, the fifth largest cryptocurrency by volume, showed similar patterns.

As such, the data shows the sharp decline in the kimchi premium is strong evidence that crypto markets have largely normalized following last year’s epic rise.

Graphs and data by Peter Ryan.

Kimchi image via Shutterstock

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Bitcoin’s drop to 3-month lows below $6,000 could be seen as the completion of a round trip.

On Nov. 1, bitcoin (BTC) prices received a shot in the arm on news that derivatives marketplace operators CME Group, Cboe and Cantor Fitzgerald were considering launching futures for the market in December. It was widely believed that BTC would zoom to dizzying heights as a move to the mainstream would open doors for a bigger kind of whale.

Bitcoin

The speculation drove prices higher to $10,000 in November, and the sharp rise and resulting fear of missing out established a positive feedback loop, one that sent prices to $20,000 by mid-December.

However, since then, the BTC has been steadily losing altitude.

A stream of negative news concerning regulatory crackdowns in some of the world’s largest markets – China and South Korea – pushed BTC below the $10,000 mark in mid-January. That said, the drop witnessed in the last five days could be associated with the decision of major banks to bar customers from buying bitcoin with credit cards. China’s decision to block access to foreign cryptocurrency platforms has only worsened the sentiment.

As of now, bitcoin is trading around $6,500 – a level last seen on November 1.

Indeed, market forces have not worked as anticipated by many. The Dow index fell more than 1,000 points yesterday, triggering a wave of risk aversion in the equity markets across the globe. However, it has not had any positive impact on bitcoin, despite its status as a “digital gold.”

That said, the oversold BTC could see a relief rally if the Senate adopts a softer approach to regulating cryptocurrencies than China.

Bitcoin monthly chart

The above chart (prices as per Bitstamp) shows:

BTC has retracted more than 61.8 percent of the rally from Oct. 2011 low of $2.22 to Dec. 2017 high of $19,666.
Bears are struggling to keep bitcoin below the 10-month moving average (MA). Currently, the MA is seen at $6,372 and is biased bullish.

Further, the relative strength index (RSI) on the daily chart, 1-hour chart, and 4-hour chart shows oversold conditions.

Also, the 1-hour chart seen below shows a bullish price-RSI divergence, which indicates BTC may have found a temporary low at $5,920.72.

1-hour chart

All the above-listed factors indicate scope for a corrective rally in bitcoin.
Prices are likely to break above the descending trendline hurdle (seen in the 1-hour chart) and revisit the 200-day MA located at $7,913.
However, further gains are unlikely in the short-run as the 5-day MA and 10-day MA carry a strong bearish bias. Usually, an asset sees sustainable rally after the short-term moving averages have bottomed out. Also, the weekly chart shows a bearish crossover between the 5-MA and 10-MA.
On the downside, a daily close (as per UTC) below $6,000 would expose support at $4,210 (78.6 percent of the rally from Oct. 2011 low of $2.22 to Dec. 2017 high of $19,666).

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Bitcoin prices have dropped below $7,00 for the first time since mid-November, signifying a continuation of the market weakness seen in the past week.

CoinDesk’s Bitcoin Price Index (BPI) hit a low of $6,888.45, representing a more than 15 percent decline since the start of the day’s trading. At press time, the price of bitcoin had recovered above the $7,000 level, trading at $7,009.75. All in all, the move marks a more than $1,200 decline from the opening of $8,186.65.

Bitcoin

As reported by CoinDesk today, the overall cryptocurrency market is down more than 50 percent from the highs seen in early January, when the overall market capitalization was north of $800 billion. According to data provider CoinMarketCap, that capitalization is now at roughly $332 billion amid a broader drop in cryptocurrency prices.

Among the cryptocurrencies impacted are ether, which slid below $700, and bitcoin cash, the breakaway cryptocurrency which has fallen under $1,000 during the day’s trading as of press time.

Observers have pointed to developments such as restrictions on access to overseas trading sites in China and a rising number of banks banning credit card purchases on crypto as reasons behind the market drop.

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The price of bitcoin is down more than 10% today, having slipped below $10,000 amid wider weakness in the cryptocurrency market, according to CoinDesk’s Bitcoin Price Index (BPI).

Price data shows that, as of press time, the price of bitcoin is trading at $9,992.12, representing a decline of roughly 9.9%. Overall, the price of bitcoin is down more than $1,100 since Tuesday’s session began.

Bitcoin

The cryptocurrency’s price had been trading above $11,000 since Saturday when it briefly went below that level. After bouncing around that figure this morning, bitcoin slid below $11,000 around 9:15 UTC.

Other cryptocurrencies have taken a hit today as well.

According to information from sites like CoinMarketCap and OnChainFX, the prices of all of the top-10 cryptocurrencies by market capitalization (which is the spot price of the token multiplied by the total amount of tokens in circulation) have fallen in the past 24 hours. These include NEM, EOS and Cardano, per info from CMC, all of which have shed at least 10% in value since yesterday.

The price of NEM’s XEM token has been particularly hard-hit today, coming in the wake of a dramatic $500 million hack from Japanese cryptocurrency exchange Coincheck. A new report from Reuters published today indicates that some of the XEM tokens stolen are being sent to exchanges in order to be sold.

Market graph image via Shutterstock

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The price of bitcoin has fallen below $10,000 for the first time since early December.

According to CoinDesk’s Bitcoin Price Index (BPI), the cryptocurrency’s value has hit a low of $9,714.02 as of press time. The last time bitcoin’s price was below $10,000 was on Dec. 1, BPI data shows.

Bitcoin

Market analysis suggests that the price could shift in either direction and recent regulatory developments – out of South Korea and China in particular – could roil markets further, according to some observers.

Bitcoin’s come comes amid the backdrop of a wider fall in cryptocurrency markets, a state of affairs which was on full display during yesterday’s trading session. Data from CoinMarketCap shows that many of the top cryptocurrencies remain in the red for the past 24 hours, including ether, which has fallen below $900.

By far the worst performer is the BitConnect cryptocurrency, which has plunged more than 90% on news that the company behind is moving to shutter its lending and exchange platform amid a wave of criticism and regulatory scrutiny.

As it stands, the collective market capitalization of all cryptocurrencies has dropped more than $200 billion since yesterday.

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Bitcoin

The price of a bitcoin has just plummeted by over $1,300 in little more than an hour.

Having been on the slide in recent days, in large part seemingly due to new regulatory efforts to calm the enthusiastic crypto market in South Korea, chart analysis had indicated that bitcoin would recover and even return to $15,000 levels today. However, that did not happen.

The cryptocurrency opened today’s session at $13,585, and reached a high of $13,601 before the sudden tumble at soon after 07:00 UTC that saw the price drop from $13,210 down to $11,850 at 08:30 UTC. That’s a fall of $1,360 in just 1.5 hours.

The drop puts the price of a bitcoin at a month low. Dec. 5 saw bitcoin at a similar level, however, that was when the cryptocurrency was climbing fast on the way to setting a new price record around $20,000, as the launch of bitcoin futures contracts from CME Group and CBOE was being anticipated by the trading community.

At press time, bitcoin had recovered slightly, and was trading at $12,195 – down 10 percent for today, according to CoinDesk’s Bitcoin Price Index.

The news comes as the wider cryptocurrency market is seeing losses. All the top 20 cryptocurrencies by market capitalization are in the red today, with ethereum down 14 percent, Ripple down 21 percent and bitcoin cash down 19 percent over the last 24 hours, according to CoinMarketCap data.

The overall market cap for all tokens is at $584.9 billion at press time – down from a high of $832 billion on Jan. 7.

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Ariel Deschapell is a full-stack javascript developer teaching at the Ironhack coding bootcamp, and a Henry Hazlitt fellow in Digital Development at the Foundation for Economic Education.

The following article is an exclusive contribution to CoinDesk’s 2017 in Review.

Bitcoin

After a year of explosive price growth, forks, failed forks and more, there is much that can be said about bitcoin in 2017. Massive strides were taken, and much has been learned. However, as we push further into uncharted waters, what happens from this point onward continues to be just as divisive a topic as ever.

Underlying both much of the year’s drama and continued future uncertainty is a simple question: Can bitcoin scale as it continues to capture mainstream attention, or will it become a victim of its own success, with alternative cryptocurrencies waiting in the wings to overtake it?

Of course, no one can honestly answer this question with total certainty. Predicting the future is a messy business, because the future is constantly in flux. It is not and cannot be fixed or predetermined. Rather, the future is being shaped and created gradually in the here and now by those unsatisfied by the present.

As George Bernard Shaw wrote:

“The reasonable man adapts himself to the world; the unreasonable one persists in trying to adapt the world to himself. Therefore, all progress depends on the unreasonable man.”

So, as we reflect on a breathtaking year and ponder what challenges the future may hold, it’s worth paying special attention to those unreasonable men and women who are doing the creating.

Scaling bitcoin

At the beginning of November, one of the longest running and recognized technical conferences in the blockchain sector hosted its 2017 conference in partnership with The University of Stanford: Scaling Bitcoin.

For the fourth time, Scaling Bitcoin brought together academics, developers and entrepreneurs from across the blockchain ecosystem, many of whom have been in the thick of cryptocurrency ideas and development for years. With this long and deep experience comes a sense of perspective and order of priorities that shouldn’t be ignored.

For those looking to the future of cryptocurrency and wondering what’s preventing us from getting there, there’s no better place to start.

Immediately notable to CoinDesk Editor-in-Chief Peter Rizzo was that despite this rare concentration of industry veterans, discussion largely ignored much of the latest hot button drama dominating the cryptocurrency news cycle.

While the conference stayed true to name with presentations focusing on possible Bitcoin Core optimizations and layer 2 proposals, the controversial topics of forks and block size were seldom touched on during the course of the conference. Participants showed little apprehension for seemingly pressing controversies such as the Segwit2X fork, and most attendees, including myself, were confident that it would be dead upon arrival.

A belief and attitude that was quickly validated when 2X was canceled the very week after the end of the conference.

As a result, and for better or worse, bitcoin would not increase its base block size. The incompatible vision of much larger block size limits for bitcoin would for now embody itself only in the bitcoin cash blockchain. This has led to many predictions that bitcoin cash and other alternative cryptocurrencies will overtake bitcoin as its block size limit becomes a bottleneck for adoption.

With only a few notable exceptions, the majority of Scaling Bitcoin’s attendees did not indicate that they found this to be a notable concern. However, that is not to say that attendees were not vocal about any pressing technological challenges. If the wide ranging topics of presentations were of any indication, far from it. But one way or another all participants did agree on a single, much wider, and more fundamental concern for scaling this still nascent ecosystem: a drought of quality developer talent.

As developer and attendee Jimmy Song puts it plainly:

“Training more developers is the biggest bottleneck in the ecosystem.”

It is very appropriate then that besides the location of Stanford, also unique to this year’s Scaling Bitcoin was a new attempt by its organizers to directly tackle this problem.

Bitcoin Edge Dev++

The Dev++ workshop was established by the Scaling Bitcoin organizers with the sole mission of educating and helping to onboard aspiring blockchain developers, and it accomplished this with studded star power.

For the inaugural Dev++ program, dozens of participants attended presentations and guided demonstrations from well-known names from across the industry. These included the aforementioned Jimmy Song, Bitcoin Core contributor John Newberry, MIT’s Thaddeus Dryja, and many others.

This ensemble of technical experts delivered a crash course covering everything from the cryptographic fundamentals of bitcoin, to the theory and implementation of second-layer networks. The latter featured a live and interactive demonstration of the Lighting Network software on testnet by Dryja himself, co-author of the original white paper.

Perhaps as insightful as the Dev++ demonstrations themselves, however, was an off hand comment by Dryja which surprised some attentive students, and told them all they needed to know about the need for the event in the first place.

When asked whether a minor Lightning Network feature had been implemented yet, Dryja responded:

“No. I had the idea over a year ago and just haven’t had the time to implement it… But it’s all open source so if anyone wants to make a pull request, like, please. That would be awesome. I just haven’t had the time.”

This playful yet earnest response reveals the true bottleneck for scaling bitcoin and blockchain technology. Like all things it is time, the scarcest of all resources. We have no control over the passage of time, but what we can do is better leverage it. Finding, encouraging and developing more of those unreasonable individuals whom all progress depends upon is the only way to bring the future closer and faster.

As Lightning Network developer Jack Mallers writes on reddit “… I can say that the only thing that can speed up Lightning is more engineers. I am the only dev behind Zap and I only spend time I can afford to spend. One more dev on Zap and myself officially full-time would make a world’s difference.”

This sentiment is echoed by the CEO of Lightning Elizabeth Stark who says: “Time! We need more hours in the day.”

Indeed, the number of full-time developers working on such a widely anticipated technology may surprise you: “There are 10 or fewer full time developers working across all implementations of Lightning,” says Stark. “Getting more contributors and people building out the protocol would certainly help move things along.”

Time and talent

Given the central importance of layer-two development in the ongoing scaling debate, the fact that there are only 10 full-time developers working on the Lightning Network should be a dramatic wake up call for many. But the problem of unmet demand for developer talent in the cryptocurrency ecosystem runs even deeper.

Conferences such as Scaling Bitcoin are hallmarked by their uninterrupted lineup of presentations on some of the latest areas of research and development. It’s common and tempting to come away overly enthusiastic regarding so many of the innovations seemingly on the cusp of realization.

However, many know better. Those in the space longest know to temper their expectations, but it’s those with experience developing software especially who understand first hand that forward progress is usually much slower and more tedious than anyone would like.

Take Segregated Witness, which despite extensive support from the open-source developer community, took three years to implement and activate on the bitcoin blockchain after its initial proposal.

For those with any coding experience this shouldn’t be a shock. When it comes to any level of programming ideas are easy, it’s implementation that’s hard. Building even the seemingly simplest program or feature always reveals hidden complexities and subset problems which must be painstakingly addressed and solved. So when it comes to building anything in this unprecedented ecosystem of distributed and security critical financial software, this tedious reality is multiplied by orders of magnitude.

As if this doesn’t complicate forward progress enough, there’s yet another problem facing developers: deciding what to work on in the first place.

Cryptocurrency and blockchain is a burgeoning field with vast unknowns. With those vast unknowns comes spiraling possibilities, but also endless disagreement.

As Scaling Bitcoin showcased, there’s a plethora of competing ideas being explored at any given time, many of which attract public attention. What is rarely noticed by the public, though, is the majority of these ideas being marginalized later on for more promising efforts, or tossed into the waste bin altogether.

While this may at first seem problematic, it is a necessary and desired consequence of exploring uncharted frontiers. Sometimes it is obvious whether an idea can or cannot work, but many times it is not.

After all, as Bitcoin Core contributor Peter Todd told me: “You can never really know if something is secure. You only know when it’s been exploited and no longer secure.”

This dynamic leads to many debates regarding not just what technology is possible to implement, but what should be implemented, and where efforts in the space should be most focused when various threat models are taken into consideration.

The result of all this is the impossibility of finding any identical appraisal of the same proposal or idea from any developer in the space, let alone any consensus on where additional research and implementation efforts are most worthwhile. Extensive trial and error is thus the only option left to us to determine what ultimately works and what doesn’t. This of course, requires even more qualified developers.

A difficult road

This is exactly what Dev++ and other programs such as Chaincode’s residency program and Jimmy Song’s Programming Blockchain attempt to address. But while these efforts are gradually growing the educational tools, resources, and courses available, becoming a blockchain developer is a long and difficult road with many challenges.

Most however, are psychological.

For aspiring blockchain developers, it is easy to be intimidated by the necessarily steep learning curve that the field naturally presents. As both a former student and subsequent Teaching Assistant at the Ironhack Fullstack Bootcamp, I know first hand that intimidation is the single largest barrier for any student looking to master any kind of software development.

Paradoxically, such feelings can even be enhanced by the depth of knowledge of instructors like those at Dev++, and the perceived futility of reaching the same level of mastery on the part of students. It may even be reinforced in some by the perceived attitudes of Bitcoin Core contributors that comes with the repositories well known and extremely critical peer review process.

This was illustrated when I asked Bitcoin Core maintainer Pieter Wuille what the easiest way for a developer to contribute to the repository was. “Definitely code review.” he responded, before quickly qualifying his statement.

He continued:

“However it’s inaccurate to call it easy. It’s not. The standard for contributing and reviewing Bitcoin Core code is very high.”

There is very good reason for Bitcoin Core’s rigorous approach to code quality, and achieving the knowledge level of contributors like Pieter Wuille and John Newberry may indeed seem daunting. However every programmer has to start somewhere, and it’s a massive mistake for aspiring blockchain developers to confuse the high bar of this single repository with the level of ability needed to make meaningful contributions to the larger ecosystem.

Countless projects besides Bitcoin Core could benefit greatly from additional talent, and can provide an avenue for less experienced programmers to begin getting their feet wet.

As Elizabeth Stark notes:

“Luckily it’s a lot easier to learn how to build Lightning apps than to learn how to get involved in protocol development. That said, getting into Lightning app development can actually be a good entry point to learning more about the protocol.”

The extensive development and testing that remains to enable and fully explore mainstream Lightning Network adoption is just one example of a possible starting place for greener developers. But there are other, even lower hanging fruits to seize on.

As a web developer myself, I was approached and solicited for feedback regarding no less than three separate APIs while attending Scaling Bitcoin. APIs in the space allow other developers the ability to utilize blockchain features, such as proof of existence, without the intricacies of running a full node.

Building and contributing to this type of digital infrastructure is not only essential for the growth of industry in the ecosystem, but provides an excellent low hanging fruit for developers with little blockchain experience. Such opportunities provide a way of making meaningful and necessary contributions to the ecosystem while familiarizing developers with the deeper technology. There is simply no shortage of such work if one simply looks.

Securing the future

As we progress into 2018, all attention will be focused on the exciting and easily visible.

Price movements and industry drama will dominate headlines and mainstream attention as they always have, and will be the catalyst of many clicks, tweets and comments.

But the real and under-appreciated story will as always will be the tinkerers, and not just those contributing to Bitcoin Core or the Lightning Network. The ones outside of the limelight grappling with nuanced and esoteric problems are just as important.

They are ones who despite hurdle after hurdle and no fanfare, are struggling to slowly alter the state of the world and create a better one. It’s they who make the incremental and so often seemingly inconsequential advancements that, when taken together, drive an ecosystem forward.

Regardless of how it plays out, 2018 is not a make it or break it year for bitcoin or cryptocurrency at large.

The most important and foundational work has time horizons and payoffs far beyond the next year. These efforts are focused not on drama, PR stunts or even the technology itself, but on the people who are and who will be developing it.

As Jimmy Song again plainly puts it:

“I believe bitcoin to be an anti-fragile thing, but its anti-fragile not because the software code is so smart but because there are really smart developers that are strengthening the network… and I believe that the more really good developers we get into the system the better it will be and the better store of value it will be.”

While traders may move the markets, it is the tinkerers that will truly determine the future. As we begin a new year, what we need is many more of them.

Think another challenge is even bigger?! CoinDesk is now accepting submissions to its annual 2017 in Review. Email news@coindesk.com to make your voice heard.

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The price of bitcoin has broken yet another all-time high today, crossing the $13,000 line for the first time.

The CoinDesk Bitcoin Price Index (BPI) has posted a high of $13,017.96, representing a gain of more than 10 percent since the day’s open and an overall rise of over $1,300. It also brings bitcoin’s total market capitalization to roughly $217 billion,

Bitcoin

The move continues the trend reported earlier today when the price of bitcoin posted a $1,000-gain over the course of 24 hours. The price of the world’s largest cryptocurrency by market capitalization pushed past $12,000 for the first time earlier today.

At press time, the price of bitcoin is trading at $13,002.44, BPI data shows.

Additional data from CoinMarketCap.com shows that South Korean exchanges continue to trade well above the rest of the market, with Bithumb, Coinone and Korbit reporting trades above $15,000 (denominated in the Korean won) at press time.

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Billionaire investor Carl Icahn has jumped on the bandwagon of those in finance who have recently claimed bitcoin is in a bubble.

The business magnate and founder of Icahn Enterprises told CNBC that the cryptocurrency “seems like a bubble” and that he didn’t understand the hype around bitcoin.

Bitcoin

Icahn stated:

“I got to tell you honestly, I don’t understand it … I just don’t get it. I just stay out of something if I don’t understand it.”

The investor further compared the bitcoin market to 18th-century Mississippi land bubble before it finally collapsed. “To me, this is what this is,” he said.

His comments follow similar comments from investor Warren Buffett in October, describing bitcoin as a “real bubble“. Buffett said at the time, “People get excited from big price movements, and Wall Street accommodates,” while criticizing the idea of applying a value to bitcoin.

Additionally, Credit Suisse CEO Tidjane Thiam stated last month that bitcoin is “the very definition of a bubble,” calling the anonymity of the cryptocurrency a “challenge.”

Bubble image via Shutterstock

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The former chief economist of the World Bank wants bitcoin banned.

“Bitcoin is successful only because of its potential for circumvention, lack of oversight,” Joseph Stigliz, currently a professor at Columbia University, said in an interview on Bloomberg Television today, as the cryptocurrency reached new all-time highs this week.

Bitcoin

Because of this, he added:

“So it seems to me it ought to be outlawed. It doesn’t serve any socially useful function.”

However, Stiglitz, who also chaired the U.S. President’s Council of Economic Advisers during the Clinton Administration, said he does support technological innovation in payments, but thinks digital money should still be fiat created and controlled by the government.

“Let’s move away from paper into the 21st century of a digital economy,” he said.

Like many other members of the Davoisie, Stiglitz – who won the  Nobel Memorial Prize in Economic Sciences in 2001 – called the run-up in bitcoin’s price unjustified and unsustainable.

“It’s a bubble that’s going to give a lot of people a lot of exciting times as it rides up and then goes down,” he said. “The value of a bitcoin today is expectations of what the bitcoin is going to be tomorrow.”

And even though bitcoin is a decentralized network, with participants scattered around the globe, Stiglitz seemed to think Washington could easily nip it in the bud.

“If the government says ‘the reason bitcoin is being used is circumvention,’ they could close it down at any moment,” he said. “And then it collapses.”

You can watch the clip here:

Joseph Stiglitz photo via Wikimedia Commons.

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Bitcoin’s price rose above $8,100 for the first time on Sunday.

Data from CoinDesk’s Bitcoin Price Index (BPI) indicates that the price climbed to $8,101.91 between 20:00 and 20:15 UTC. This move came after bitcoin – which toed the $8,000 line during Friday trading – crossed that threshold several hours earlier.

Bitcoin

That the price of bitcoin would surge above this height was in the cards last week, as was suggested by analysis at the time. Conversely, last week saw some dramatic movements on the price front, with markets dropping below $6,000 only to recover days later. Market commentary throughout the week was led, in part, by speculation around pending futures product launches and interest among institutional investors overall.

Indeed, the move confirms a possibility floated by analysts from investment bank Goldman Sachs earlier this month. The firm’s analysts have published several forecasts since earlier this year, notably predicting some of the developments seen over the summer.

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Edan Yago is CEO and founder of Epiphyte, a startup performing FX funds settlement on the bitcoin blockchain for financial institutions. 

In this opinion piece, Yago discusses one of the biggest theoretical attacks against bitcoin, and why he believes an upcoming software change fits its definition. Follow Edan Yago on Twitter.

Bitcoin

In bitcoin’s Necronomicon of possible attacks and weaknesses, one reigns supreme – the 51% attack.

If there is a fear that has played on people’s minds as the end-of-days scenario for bitcoin, it is this. Attackers who hold more than 50% of hashing power could stop transactions from confirming and even reverse some transactions. They could undermine the whole project.

Bitcoin’s design and its system of economic incentives has been set up specifically to combat the destructive potential of a 51% attack. And it has worked. The 51% attack has remained a hypothetical bogeyman. Until now.

By all indication, a coordinated 51% attack will begin on, or around, Nov. 16. That’s when a consortium of miners representing substantially more than 50% of the network’s hashing power and an allied group of blockchain startups will seek to increase the block size.

This will require a hard fork, which while controversial, is a legitimate desire. In itself, this is not an attack.

Where it goes wrong

However, the consortium‘s effort has evolved beyond a simple fork. It is now being developed not simply as an effort to fork the chain, but to do so in such a way as to deliberately prevent the continued existence of the status quo chain.

Specifically, the developers involved have declined to introduce replay protection.

The 2x fork will create a situation where transactions performed on one fork, can be “replayed” on the second fork. In effect, users will have funds on both blockchains, but any transaction they perform on one blockchain could lead to a loss of funds on the other blockchain.

Replay protection is a fairly easy-to-implement method to protect users from this risk. Network attacks are those actions taken with the intention of disrupting the protocol’s normal functioning. The 2x change, bereft of replay protection, causes massive disruption. This is by design.

Without replay protection in place, a minority chain becomes less likely to survive.

Question of motives

The preferred outcome for the consortium is that the status quo chain ceases to exist, that its transactions fail to confirm.

This is the literal definition of a 51% attack. If it sounds a bit bizarre to call the consortium’s effort an attack, that’s because it is. The consortium comprises many real supporters of bitcoin, acting in what they believe is good faith. They don’t mean to be attacking bitcoin.

However, without replay protection their efforts are like an autoimmune disease, having become overzealous and perverted.

So, bitcoin is finally coming to come face-to-face with the mother of all attacks. This is a watershed moment. The very worst outcomes are bad indeed.

Transactions could grind to a halt, faith in the system could be lost, bitcoin and by extension, the entire blockchain world could prove to be far more vulnerable to attack than we hoped.

We shall overcome

However, there is also another possible, even more likely, outcome.

Bitcoin could prove resilient to the consortium’s attack and emerge battered but unbroken. In so doing, bitcoin will have proven itself resilient to even its greatest foe.

It is hard to overstate how important this will be to bitcoin’s perceived reliability. Bitcoin has always been haunted by the risk that its rules might come to be dictated by special interest groups or hostile, state-sponsored parties.

This risk is never going completely away, but instead of the risk being a hypothetical bogeyman, it will become a much more prosaic thing: a successfully managed risk.

The 51% attack is bitcoin’s boss level. I don’t think it’s an exaggeration to say that we are now at the end of the beginning. If we successfully overcome this coming challenge, bitcoin will no longer be just an experiment, it will be a fact.

But don’t expect less drama — we are now entering bitcoin’s adolescence.

HODL on tight, things will get hairy.

Disagree? Have your say on the Segwit2x debate. Email CoinDesk managing editor Marc Hochstein at marc@coindesk.com to pen your rebuttal.

Disclosure: CoinDesk is a subsidiary of Digital Currency Group, which helped organize the Segwit2x agreement.

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The price of bitcoin has slid below $7,000 just a day after climbing above the $7,600 level.

The turnaround represents a more than $400 decline amid today’s trading, according to data from the CoinDesk Bitcoin Price Index (BPI). As previously reported, prices jumped to an all-new high yesterday before starting to pull back as Monday’s trading got underway.

Bitcoin

The tumble below $7,000 began around 18:58 UTC, according to the BPI, with the market slipping as low as $6,948.57.

At press time is trading at around $6,989.64, a decline of roughly 5.6 percent on the day.

Broader market data indicates that the fall in the price of bitcoin stands in contrast with market developments for other cryptocurrencies.

For example, per data from CoinMarketCap.com, the privacy-oriented cryptocurrency monero’s price is up more than 13 percent in the last 24 hours. Ethereum, the second-largest cryptocurrency by market capitalization, has risen roughly 2.5 percent during the past day of trading.

Roller coaster image via Shutterstock

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“The chain will fork, life will go on.”

Pseudonymous Bitcoin Core contributor BTCDrak views bitcoin’s upcoming Segwit2x hard fork – which has a chance of splitting bitcoin into two competing networks – with a bit of boredom.

Bitcoin

And that blase tone seems to resonate with several of bitcoin’s most active developers, even those who were vocally unhappy when the Segwit2x proposal was first unveiled in May. But just a couple weeks away from the fork itself, it appears this outrage has turned steadily into annoyed acceptance.

In short, the contributors to bitcoin’s open-source code are optimistic for a simple reason: they don’t think Segwit2x will succeed in its attempt to become the main bitcoin blockchain.

Against the backdrop over the past few months, in which two hard forks led bitcoin to split into new assets with different developer teams, bitcoin’s long-time developers largely believe neither has come close to surpassing bitcoin by any significant metric.

And they don’t expect differently from Segwit2x.

While the group behind the effort has secured the support of a number of startups and mining pools, they argue there’s not much of a difference in the support as compared to previous forks. Though the next fork has yet to occur (it’s expected in mid-November), they already see Segwit2x as a blip in bitcoin’s history.

BTCDrak told CoinDesk:

“Miners will continue to mine bitcoin.”

No more compromise

And other developers feel similarly.

Blockstream CEO Adam Back and Bitcoin Core contributor Eric Lombrozo claim they tried to be diplomatic when the proposal was first unveiled in June, arguing they wanted to work with those supporting Segwit2x to come to a scaling agreement.

Back explained that he sincerely wanted to “build on the proposal,” although he advocated for a longer hard fork timeline and a specific hard fork mechanism.

Yet, both are less willing to compromise as the hard fork date inches closer.

Central to this sentiment is that, ultimately, developers think Segwit2x will fail because the way it’s implemented goes against how bitcoin is intended to work – that, and because it tries to push through a change that doesn’t have broad support.

As a result, developers contend that the group is using a centralized strategy to drive decision-making on a decentralized network.

“I was hopeful that the intent of this whole thing was to activate SegWit and then work together, as a community, on building consensus for further upgrades in the future,” Lombrozo said. “Instead, it turned into a coup.”

Back voiced similar concerns.

“It sets a very bad precedent that a small group of CEOs can get in a hotel room and make a pact that they then try to impose on bitcoin. That is no longer bitcoin.”

And with that, both developers believe the proposal will die by its own hand.

Tale of two bitcoins

But before it dies – or launches – crypto investors are trading on the possibilities.

Future versions of bitcoin (should bitcoin remain whole after the fork) and a new Segwit2x bitcoin (should the hard fork create a new coin) are trading on a handful of exchanges. And it seems developers believe this sheds light on events to come.

According to Back, the price of the Segwit2x coins – trading at about 14 percent of the price of bitcoin currently – is a sign of just how successful the cryptocurrency will be.

Back continues, pointing out that this is just about the same percentage that bitcoin cash coins were trading at before it launched via a hard fork of bitcoin in August.

“Investors will sell Segwit2x [coins] in droves,” Back claimed.

And he can say that because he’s offered to sell his own bitcoin for the new Segwit2x coin at a series of different swap rates, starting with a 1-to-1 rate.

“When [investors] didn’t buy that, I offered a 3-for-2 swap, and now I am offering a 2 -for-1 swap – a chance to double their [Segwit2x coin] holdings,” he said. “None of them bought. So, clearly, they do not have commitment, nor belief in what they are saying.”

Still, many Core developers believe the Segwit2x hard fork will result in another cryptocurrency.

And while many bitcoin users and investors see previous forks as a net positive (since they were effectively airdropped free money) Lombrozo hopes something else will come out of the process.

Summing up his feelings, Lombrozo displayed almost a sense of exhaustion.

He told CoinDesk:

“The whole thing is stupid, I just hope this serves as a good lesson for everyone on how not to do these things.”

Disclosure: CoinDesk is a subsidiary of Digital Currency Group, which helped organize the Segwit2x proposal, and has an ownership stake in Blockstream. 

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The price of bitcoin has reached yet another all-time high this week, rising past $6,600 for the first time.

Markets hit an average high of $6,629.00 around 16:34 UTC, data from the CoinDesk Bitcoin price Index (BPI) shows.

Bitcoin

The market ramp came hours after CoinDesk’s Bitcoin Price Index reported a first-ever high of $6,500 on November 1, pushing the total market capitalization of Bitcoin to over $110 billion.

Recent price advances have increased the share of bitcoin’s market capitalization compared to the rest of the cryptocurrency ecosystem. According to the data from CoinMarketCap, bitcoin accounts for nearly 60 percent of the entire $183 billion cryptocurrency market.

As of press time, the price had fallen back below $6,600, trading at around $6,579.

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The price of bitcoin has hit a new all time high, crossing the $6,300 mark for the second time this week.

According to data from the CoinDesk Bitcoin Price Index (BPI), the price has reached $6,341.10. On Oct. 29, the price of bitcoin rose to $6,306.58, a move that came just over a week after markets moved above $6,000 for the first time.

Bitcoin

Markets, the data shows, have consistently traded above this level since Oct. 29. Overall, the price is up more than 500 percent since the start of the year, having begun the year just below $1,000.

Today’s climb also represents a gain of more than $200, per data from the BPI, bringing bitcoin’s market capitalization to roughly $106 billion.

At press time, the price of bitcoin is trading at $6,330.85, a gain of about 3.4 percent on the day.

The other top-10 cryptocurrencies (by market capitalization) have seen mixed results in terms of trading today, including bitcoin cash, which is down more than 4 percent at press time. The cryptocurrency’s price has been trending down in the run-up to a planned technical change.

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Bitcoin hit a new record high of $5,856 on CoinDesk’s Bitcoin Price Index this morning, but the question everyone will be asking is, can the rally continue?

At press time, bitcoin is trading at $5,610 levels, as per CoinMarketCap data. Bitcoin’s week-on-week performance of over 28 percent (up more than $1,200,) is double S&P’s year-to-date gains of 14 percent.

Bitcoin

Further, the cryptocurrency is up 96 percent from its Sept. 15 low of $2,980, and, on a year-to-date basis, is up almost 500 percent.

Following a rally of such astonishing proportions, it would be quite logical to assume bitcoin prices will trade sideways, or witness a healthy pull-back in the short-run

The price action analysis indicates that bitcoin could find a short-term top in the range of $5,800-$6,000.

Daily chart

The daily chart shows that:

Bitcoin’s price suffers a corrective pull back every time the stochastic and the relative strength index (RSI) signal overbought conditions (marked by hand sign and red circles on the chart). The stochastic oscillator is a chart analysis indicator that helps determine where a trend might be ending.
The trend line drawn from the July 16 low and Aug. 22 low and extended further is seen offering resistance around $6,100 levels.
Though overbought, the RSI is still rising. Meanwhile, the stochastic is looking to retreat from the overbought territory.
A technical correction would gather pace once the RSI starts losing altitude.

View

A short-term consolidation around $5,800 or brief spike to $6,000 followed by a short-term pull back to $5,000-$5,300 looks more likely.

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When the price of bitcoin plunges — as it did last week — seasoned investors are caught in a market that doesn’t exactly have the mechanisms they’re used to.

Case in point, hedging long positions, is today a difficult prospect. Unlike most traditional stocks, where investors can open a margin account with their broker that allows them to short most shares, the tools in bitcoin are few and far between.

Bitcoin

Yet, while some see betting big on bitcoin as a gamble in and of itself, a new casino-like exchange type is filling the gap for those seeking to bet – or otherwise prepare for – the cryptocurrency’s drops.

Enter parimutuel betting pools.

Far from a familiar term, it’s nonetheless an important one should traders want to know what they’re buying into. In simple terms, parimutuel pools are a way of speculating on the future price of cryptocurrencies without actually owning the coins themselves.

Or as Lanre Sarumi, CEO of Level Trading Field, which last month launched parimutuel pool Bitcoin Market Predictor, told CoinDesk:

“Parimutuel [betting] is a group of people essentially predicting something, and the person with the most accurate prediction wins.”

Yet, their structures can differ dramatically. One might look more like a cryptocurrency Powerball, while the other is an intense derivatives exchange touting triple-digit leverage.

While their use for short exposure is a bit underdeveloped, more investors are participating in these pools – knowingly or not – to fill the gap.

And if they’re not aware of the limitations and risks involved, they could end up surprised – after all, parimutuel betting isn’t the most sophisticated structure for providing short exposure.

A simple game

Lanre’s Bitcoin Market Predictor, what he calls a “game of skill,” is the latest evidence that parimutuel pools could add some cushion to the cryptocurrency market’s lack of shorting options.

But while theoretically it gives users the ability to bet on bitcoin’s price dipping, the rules of the game are strict, allowing only groups of 10 to bet on the price of bitcoin only 60 minutes in the future. The three players with the most accurate predictions, whether the price is up or down, split the money from the group’s betting pool, so at $50 per player per round, the most an investor can make off their prediction is $225.

Obviously, this presents problems for serious retail investors, since the price of bitcoin (which they might hold) could drop substantially, and all they’ve done is make $225 at most betting that it would.

And if three other players predict closer to the actual price, an investor loses even the money they put in the pot.

In this way, Level Trading Field’s parimutuel pool is less a sophisticated way to short bitcoin, and more an enticing platform for those interested in gambling, and only gambling on bitcoin.

Still, the latter limitation could be especially important in today’s cryptocurrency market, since in early August all bitcoin investors got equal parts of another cryptocurrency, when a group of enthusiasts split from bitcoin’s blockchain creating bitcoin cash.

After all, if free money is being given out to bitcoin holders, it isn’t exactly to the investors benefit to be caught in a limited short position.

Moral hazard

The bitcoin-only limitation carries over to the other end of the parimutuel betting pool spectrum with BitMEX’s full-blown derivatives exchange.

The high-octane exchange is run by former Citigroup trader and ferocious bitcoin bull Arthur Hayes, who told CoinDesk its 100 times leverage was not only its differentiator, but its sex appeal. Traders come to BitMEX wanting to place high-powered bets with very little money down. But, clear that kind of colossal leverage isn’t without risk.

Parimutuel betting means that one trader’s gains are offset by another trader’s losses — so every dollar you win is offset by a dollar someone else in the parimutuel pool has lost – which creates what Hayes calls “moral hazard.”

And that hazard means if your trades are crushing it on BitMEX, there might not be enough equity in the system to pay out your winning bets.

In a way, it’s like breaking the bank at a casino. If the market makes huge moves too fast, traders with losing positions have those bets closed and sold. And without enough equity in the system to payout on the other side, traders with winning positions will also be closed out early, in essence capping the returns they can get.

To Hayes’s credit, he’s incredibly upfront and transparent about it:

“If you want 100x leverage – which obviously you do, because that’s why you’re here – you accept that we at BitMEX can’t put our balance sheet on the line to settle these contracts.”

Yet, still, candid or not, this risk doesn’t allow traders to get a foolproof short opportunity.

In this way, the market – however mature it’s becoming – is still struggling to offer investors refined mechanisms as they prepare for another possible plunge.

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Australia’s government has introduced a bill that delivers on a long-standing promise to solve a “double taxation” problem for cryptocurrencies.

As it stands today, Australians are potentially liable for goods-and-services tax (GST) when they either purchase or spend a cryptocurrency. This state of affairs has been the target of criticism from the country’s local bitcoin community, and in March 2016, the government announced a plan to resolve the issue by removing the tax at the time of purchase.

Bitcoin

Now, months after unveiling a budget that included the tax cut, Australia’s government has introduced legislation that would, if passed, codify the elimination. In a September 14 statement, the Australian Treasury said that the plan would “cement Australia’s reputation as a global fintech centre.”

The government explained:

“The Bill will ensure that Australians are no longer charged GST on purchases of digital currency, allowing it to be treated the same way as physical money for GST purposes. The law change will retrospectively apply from 1 July 2017, in line with the 2017 Budget announcement.”

The measure was framed as part of a wider effort to promote financial technologies in Australia, including its homegrown cryptocurrency ecosystem.

“The Bill will make it easier for new innovative digital currency businesses to operate in Australia, as the government takes action to boost jobs and wages.”

It’s not immediately clear when the bill will be brought up for debate and potential revision. Australia has a bicameral legislature, meaning that both chambers would need to approve the legislation before it could advance and become national law.

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The price of bitcoin fell more than $500 today as market turmoil continues in the aftermath of Chinese exchange BTCC’s trading stoppage announcement.

Bitcoin

The CoinDesk Bitcoin Price Index (BPI) has hit a fresh low of $3,350.17 – roughly $523 dollars down from the day’s open of $3,874.26. When accounting for the day’s price high of $3,923.98, that figure swells to approximately $573.

At press time, the price is at $3,363.25, according to the BPI.

Shanghai-based BTCC announced that it would would cease offering trading services on September 30, citing statements issued earlier this month by the People’s Bank of China and other regulatory bodies in the country. BTCC’s move came just a day after China-based BitKan announced that it would halt its over-the-counter (OTC) trading offering.

The new move downward comes hours after bitcoin’s price fell below $3,500, falling below the 50-day moving average for the first time since July 20.

Many other cryptocurrency markets are experiencing sharp declines today, according to data from CoinMarketCap. Of the top-10 cryptocurrencies, litecoin has seen the heaviest decline, falling in the last 24 hours by more than 24% at time of writing with much of the volume being seen in Chinese exchange OKCoin and Huobi.

The collective cryptocurrency market capitalization has fallen below $120 billion for the first time in a month, per CoinMarketCap, hitting roughly $114.4 billion at press time.

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In the coming war between digital currencies, which side will your money be on?

If that question sounds crazy, meet Arthur Hayes, a former CitiGroup trader who runs BitMEX, a Hong Kong-based crypto exchange that allows eye-bulging leverage – up to 100 times – when buying and selling cryptocurrency derivatives.

Bitcoin

Not just another Wall Street veteran, Hayes may also be one of the industry’s biggest bitcoin bulls. It’s a bold claim, but you might agree if you saw his newsletter – a regular synthesis of cryptocurrency news, gangster quotes, GIFs and end-of-the-world premonitions.

In fact, Hayes thinks blockchain is lighting a fuse that will ignite open combat between “true cryptocurrencies” (like bitcoin) and a new “digital fiat” controlled by central banks.

These two parallel currency systems are the inevitable outcome of his core investing thesis:

“A digital society needs digital cash.”

In other words, bitcoin has brought the world cryptocurrency and institutions of all kinds will use the technology to their advantage.

Here’s what Hayes sees shaking out as a result: Governments will respond to the proliferation of cryptocurrency by withdrawing banknotes from circulation, and governments will issue digital fiat that functions similarly to cryptocurrency.

But don’t be fooled, according to Hayes, the similarities here are all on the surface.

Government-controlled digital fiat will be the antithesis of absolutely everything true cryptocurrency stands for. Central bank’s issuance of digital money will lead to a brave new world where governments are able to monitor and control every single transaction in an economy.

And countering that overreach is the reason Hayes believes bitcoin and other cryptocurrencies have a value proposition not just today, but for years to come.

The digital combatants

When Hayes talks about digital money, he sees the scope of battle on a truly global scale, not just within the U.S., but all across Europe, in China and in India.

What all these country’s governments have in common, according to Hayes, is the desire to use digital fiat as a tool of economic control.

He sees digital fiat as an instrument that will allow governments and global central banks to monitor every financial transaction, tax every sale and even lock out people from the payment system if they don’t have the right government-issued licenses.

Shifting digital fiat into cryptocurrency, he reasons, will be the only way to preserve privacy. Plus, cryptocurrency will allow individuals and businesses to trade in jurisdictions where parties don’t trust electronic fiat – or each other, for that matter – because they know cryptocurrencies cannot be tampered with.

Hayes said:

“If you want to have a financial presence – and not have somebody else know what you’re doing at all times – then you’ll use a form of cryptocurrency.”

A form of cryptocurrency that’s true, like bitcoin, zcash, monero or dash, he says, is one that offers users both privacy and security. These currencies, according to Hayes, have no utility other than being used as anonymous e-money.

In his mind, when a coin has additional utility it detracts from its desirability to be used as money since its value can fluctuate outside of what Hayes call its “moneyness.”

One example of a currency that is not money, according to Hayes, is ether, which he says doesn’t qualify as money because of its use case for distributed applications.

Not for the everyday

But there may be limits to the value propositions of even true cryptocurrencies today.

For example, Hayes believes that small value transactions are out of line with a once resounding narrative in the space, that bitcoin is – and should be – a payment system for consumers.

Hayes told CoinDesk:

“I don’t think bitcoin is going to replace consumer facing activities, like buying a cup of coffee or buying a magazine at a 7-Eleven.”

Hayes called bitcoin’s user experience “terrible” for these purchases, because public blockchains are slower than private payment systems. So, for a trip to Starbucks, buying coffee with Apple Pay is a better experience than paying with bitcoin, he contends.

It’s an interesting observation in that many of bitcoin’s strongest proponents tend to envision a world where the cryptocurrency is used for everything. Even still, Hayes is just as bullish on bitcoin, as he continues to reiterate what a fantastic mechanism it is for online international payments and anonymity.

And “those trade flows are massive,” he said.

But despite his bullishness, Hayes doesn’t own any coins personally. According to Hayes, he believes his stake in BitMEX gives him sufficient exposure to the crypto market, since BitMEX’s performance is tied to higher prices and market caps of cryptocurrencies and digital tokens.

Freedom in derivatives

And BitMEX is exactly the kind of exchange you’d imagine a guy like Arthur Hayes would dream up — a wild, intense, leveraged-fueled ride on a derivatives rocket ship that lets traders place high-powered bets with very little money down.

There’s a kind of freedom in derivatives, since they’re not tied to the physical delivery of any asset. Instead, derivatives bets play in a virtual world, where the only limits are the money flowing through the system.

That kind of world clearly appeals to Hayes:

“When you’re in the derivatives space you can essentially create any type of exposure you want.”

And he’s gone for triple-digit exposure, which not only makes his company “sexy” to traders, but also comes with substantial risk.

Such colossal leverage means BitMEX cannot guarantee the settlement of its trades, meaning Hayes can’t tell you for certain that you’re going to get paid out at 100 cents on the dollar on a winning trade. While Hayes and his BitMEX users enjoy this risk, someone new to the crypto space might be more than a little intimidated.

Yet, Hayes believes that’s not reason for swearing off the crypto scene altogether, instead he gives more level-headed advice to newcomers.

“I would tell that person to buy a small amount of bitcoin,” he said, noting that bitcoin is a safer bet than most cryptocurrencies because of its $80 billion market cap.

He concluded:

“Once they are comfortable with that, start doing research and deciding for themselves which coins fit their investment risk profile.”

Disclaimer: This article should not be taken as, and is not intended to provide, investment advice. Please conduct your own thorough research before investing in any cryptocurrency.

Disclosure: CoinDesk is a subsidiary of Digital Currency Group, which has an ownership stake in Zerocoin Electric Coin Company, developer of zcash.

Portrait image via Arthur Hayes 

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