Digital Currencies Have No Impact on Real Economy: ECB

Digital currencies do not have any implications on monetary policy or factor into the real economy, noted the European Central Bank (ECB) in a report published in May. The ECB published the report titled “Crypto-Assets: Implications for financial stability, monetary policy, and payments and market infrastructures,” in order to study the potential impact of virtual currencies on monetary policy and economic developments.

According to the report, at the moment, virtual currencies do not fulfill the functions of money. Cryptocurrencies can impact economic developments only if they become a credible substitute for cash and transactions.

As per the bank, the prices of virtual assets are of a volatile nature. Hence, there are only a limited number of European merchants who are ready to purchase goods and services with virtual currencies. This, in turn, limits the deployment of cryptocurrencies.

However, the report notes that things can change with the development of stablecoins. As their value is pegged to physical assets, their price can become less volatile in the future.

Moreover, the bank believes that as the value of digital currencies is not protected by any specific institution, it hinders its use as a form of money. Due to the volatility of prices, digital assets cannot be utilized as a store of value, means of payment and unit of account.    

Previously, Mario Draghi, the President of the European Bank claimed that cryptocurrencies will hardly affect the world economies in a macro way. He added that digital coins are not currencies, they are indeed just assets. A euro will always be a euro and ECB will back euro. On the other hand, nobody is backing cryptocurrencies, hence they are “very, very risky assets”, he noted. 

https://bitcoinnews.com/digital-currencies-have-no-impact-on-real-economy-ecb/

Bitfinex Claims Victory as Supreme Court Gives Nod to Exchange & Tether



By CCN: The New York Supreme Court has ruled that the scope of the Attorney General’s investigation into Bitfinex and Tether Limited is too broad and needs a time limit.

Bitfinex: supreme court ruling a "Victory"

The embattled exchange called the ruling a “victory” and insinuates that the case will end up going nowhere. Bitfinex has already admitted that as much as $850 million evaporated from its coffers while Tether Limited has publicly confessed to only partially backing the world’s oldest stablecoin.

Under the order, Tether and Bitfinex can continue business as usual, but Tether Limited may not make any loans to Bitfinex. Moreover, while the injunction has been modified, Bitfinex and Tether are called on to cooperate with the investigation to the best of their ability.

“Having now heard both sides of the story, the Court grants Respondents’ motion in part and denies it in part for the reasons set forth on the record at a hearing on May 6, 2019 and as summarized herein. In a nutshell, the Court finds that Petitioner is entitled to the Order requiring Respondent to promptly produce evidence, but that the preliminary injunction contained in the Order should be modified.”

https://twitter.com/bitfinex/status/1129158462603223040

Tether-Bitfinex credit line frozen

Judge Joel M. Cohen notes that a vital part of the attorney general’s investigation rests on the idea that Bitfinex secured a line of credit from Tether. Tether will not be allowed to loan any money to Bitfinex while the investigation is ongoing, and both companies need to provide information about that situation. While stipulating that New York law doesn’t give the AG with carte blanche, the court does uphold the AG’s right to investigate under New York business law.

“[T]he Court finds that Petitioner has made a sufficient showing to warrant a targeted preliminary injunction preventing Respondents from continuing to let dollars flow out of Tether’s reserves via the type of extraordinary transaction that triggered Petitioner’s concern.”

Moreover, while noting that Bitfinex denies the AG’s characterization of its relationship with Tether, the order more or less refutes the notion that the government has no authority over how such companies do business.

How the mighty could fall

Bitfinex believes that the investigation is a dead end. The stance smacks of the “no collusion” mantra of Donald Trump and his supporters. The firm claims it is being wrongly investigated and seems bitter about having voluntarily cooperated with authorities previously:

“The New York Attorney General’s office has sought to proceed ex parte against us and in bad faith, notwithstanding our previous, historical, and voluntary co-operation with them. We will vigorously defend against any action by the New York Attorney General’s office, and we remain committed, as ever, to protecting our customers, our business, and our community against their meritless claims.”

Part of the problem with Bitfinex and Tether’s behavior is that investors were not previously aware of the unusual dealings. Whatever the outcome, Bitfinex and Tether both find themselves in the crosshairs of one of the least-friendly-to-crypto governments in the U.S. Despite Bitfinex’s apparent confidence, the effect of this judgment amounts to a mild annoyance for the NY Attorney General.

https://www.ccn.com/bitfinex-victory-supreme-court-tether

Markets Dump $30 Billion In Massive Crypto Correction



The crypto correction that everyone has been waiting for has finally kicked in today. Markets are a sea of red and Bitcoin tumbles ten percent and altcoins get hammered. The move is not entirely bearish however and will present new support zones and entry levels for traders and investors.

What Goes Up Must Come Down

Bitcoin and crypto markets have been on fire in May. Since the beginning of the month markets have surged over 50 percent to reach a ten month high of $264 billion. This epic rally has been largely driven by Bitcoin which has dominated markets as it surged above $8,000 when most expected it to stop at $6,000.

With such rapid gains come equally violent dumps as day traders take profits and sell orders are triggered. This is exactly what has just happened to Bitcoin a few hours ago. During early Asian trading BTC dumped from just below $8,000 down to $7,175 according to Coinmarketcap.com. The ten percent slide has pulled the entire market down with it as total capitalization shrunk by $30 billion.

As expected the altcoins have been hammered even harder with many dropping double figures. Following a couple of days of solid gains, XRP, Stellar and Cardano have dumped around 14 percent each today. Bitcoin Cash, Litecoin, EOS and Binance Coin are not faring much better as the all lose over 9 percent on the day.

Total market capitalization dropped from its 2019 high of $264 billion to around $230 billion as the exodus accelerated.

A number of industry observers are still bullish though and see this correction as a healthy part of market cycles. Many are looking for new buying opportunities at BTC support levels. Analyst fil₿fil₿ said;

“Would like a bounce at $6.4k but i fully expect a 61.8% retracement from top which may present the last great buying op. @ c.$5.2k”

https://twitter.com/filbfilb/status/1128963615434977280/photo/1

$6,400 was the most traded price of 2018 so a major correction could find support at this level. Moving averages have traditionally served as levels of support and resistance and the 50 day one sits at $5,500 at the moment. On the lower side the 200 day MA is at $4,400 but a drop to here would be extreme.

At the time of writing Bitcoin had already started to recover from its intraday dip and was trading at $7,300. Further losses are expected though as Europe and America wakes up to a red Friday in crypto land.

https://ethereumworldnews.com/markets-dump-30-billion-in-massive-crypto-correction/

Coinbase Hits Trending On AppStore, The Return Of Mass Interest In Bitcoin Is Here

There well and truly appears to be a resurgence in interest in Bitcoin and cryptocurrencies, as Coinbase’s iOS has it the trending list on the App Store.



The rise in prices in cryptocurrencies is often accompanied by an increased interest in cryptocurrencies from would-be investors. The market of late 2017 saw those who had not previously invested in crypto enter the market. The crash in the following year had turned many would-be investors off, but as ShapeShift CEO Erik Voorhees explained, Bitcoin and the crypto market operate in a cyclical fashion.

The market has experienced a tremendous few days with both the prices of Bitcoin and altcoins showing signs of reaching the kind of highs that people value crypto at – Tom Lee of Fundstrat said that a fair value for Bitcoin is $14,800.

https://www.investinblockchain.com/coinbase-hits-trending-on-app-store-return-of-mass-interest-in-bitcoin/

Litecoin rallies to new 2019 high as LTC/BTC pair turns bullish

Litecoin price analysis shows LTC has reignited the fever shared amongst its crypto compatriots and rallied to a new 2019 high above $100.

Litecoin price analysis: Market overview

The hefty gains could be the result of the announcement of a new partnership with hotel booking platform Travala.com and the news could be a sign that Litecoin $100.614 +0.23% is finding another niche for mainstream use.

While Litecoin and Binance Coin had been the early birds that signaled what turned out to be the start of a new strong bullish trend within the crypto market, the altcoin had been somewhat dormant over the last 3 weeks and noticeably absent during Bitcoin’s most recent surge.

Today marked the end of LTC’s slumber and on Wednesday the altcoin railed to a new 2019 high at $107.34

LTC/BTC Daily chart


Similar to the ETH/BTC paring, the LTC/BTC pair broke bullish at the 0.01143 double bottom and traders flowed into the bull break that followed.

The overhead resistance levels of 0.01325 and 0.01412 are on the daily timeframe. A drop below the 12-EMA at 0.01233 would place LTC back within the falling wedge. The MAC D appears on the verge of a bull cross from oversold regions and the RSI is slowly making its way into bullish territory. If the bullish trend throughout the sector remains, Litecoin appears ready to grow legs and run.

LTC/USD 4-Hour chart


$109 and $127.90 are the next levels for LTC to overcome and it should also be noted that LTC set a higher low and higher high on the weekly time frame.

As for the recent pump in altcoins, a popular theory among analysts is that profits from Bitcoin’s recent parabolic run are now making their way through altcoins for an upcoming ‘alt season’ and as Bitcoin’s dominance rate decreases traders are expected to see hefty gains from an array of small-cap altcoins.

Given that Bitcoin is near the top of an amazing parabolic run, traders might consider taking altcoin profits quickly, keeping a close eye on a digital assets ability to maintain the exponential moving average of choice and using a stop loss is strongly advised.

https://bitcoinist.com/litecoin-rallies-to-new-2019-high-as-ltc-btc-pair-turns-bullish/

Ripple Is Down Nearly 50% Against Bitcoin This Year Despite Recent Rally

After becoming the darling of the 2017 crypto asset bubble, Ripple (XRP) is now down heavily against Bitcoin (BTC) in 2019. So far this year, the altcoin has already lost nearly half of its bitcoin-denominated value.

XRP is a controversial altcoin for a variety of reasons. There have been numerous allegations that an army of bots is used to promote the altcoin on Twitter. Additionally, XRP’s high level of centralization may call into question whether it should even be considered a cryptocurrency.

XRP’s Horrible 2019

According to TradingView, XRP skyrocketed 1600% against BTC on cryptocurrency exchange Bittrex in 2017. However, this was followed by a 14.5% drop against BTC in 2018 and another 46.6% drop so far in 2019 as the majority of trading has moved to Binance.



The reasoning behind XRP’s fall from grace is hard to determine. In late 2017, the price was pumping around rumors of an incoming listing on Coinbase and numerous partnerships with various banks and financial institutions.

XRP wasn’t made available on Coinbase and Coinbase Pro until February of this year, which led to a brief recovery in the declining price. However, the price of XRP has plummeted in terms of BTC since then. News that XRP trading on Coinbase is now also available to users in New York has led to another rally in the XRP price over the past couple of days, rising roughly 20% against BTC since Monday.

Additionally, investors may have finally realized that many of the banking partnerships announced by Ripple Labs weren’t related to the use of XRP or involved payments from Ripple to these institutions to incentivize them to try out the fintech company’s products.

During the price run-up in 2017, it was also widely believed that people were purchasing XRP and other altcoins instead of BTC simply due to unit bias. In other words, they were purchasing XRP instead of BTC because the price of XRP seemed so low by comparison. However, users may have been ignorant to the fact that XRP has a much larger supply than BTC.

https://www.longhash.com/news/ripple-is-down-nearly-50-against-bitcoin-this-year-despite-recent-rally

Bitwise bitcoin ETF delayed for another five weeks amidst concerns from the SEC



The Bitwise bitcoin ETF was delayed for another five weeks in a statement from the U.S. Securities Exchange Commission. So far, it seems the Commission remains unconvinced that bitcoin is sufficiently resistant to price manipulation, along with a host of other concerns.

Following a May 7 amendment to Bitwise’s bitcoin ETF application, the Securities Exchange Commission (SEC) has delayed making a decision for another five weeks to solicit comments from the public. Thus far, the application has garnered 25 comments.

The SEC’s review process gathering comments from the public is a standard part of the review process, as seen from proposed novel ETFs in the past.

“It is a mechanism that allows the SEC Staff to gather expert input from the public on specific issues surrounding various proposals while extending the statutory time period within which the Staff is required to either approve or disapprove the request,” said a representative from Bitwise to CryptoSlate.

Status of crypto-based investment products

First filed in January of this year, Bitwise continues to tweak its application to list shares of its bitcoin exchange-traded fund (ETF) on the NYSE Arca—a subsidiary of the NYSE Group which lists stocks and options.

However, the SEC, for a second time, has delayed ruling on the application. Previously, the Commission expressed reservations about bitcoin and cryptocurrency-based investment products, such as ETFs. CBOE is facing similar difficulties with its Van Eck SolidX Bitcoin ETF; the exchange resubmitted its application in January after withdrawing it that same month.

According to Bitwise, the ETF will satisfy the rules of the NYSE Arca, providing evidence that the ETF will be accurately priced, resistant to price manipulation, and adequately bitcoin-backed.

Yet, the SEC remains unconvinced that these ETFs can meet federal guidelines for national securities exchanges. Notably, that these exchanges are able to “prevent fraudulent and manipulative acts and practices” and “protect investors and the public interest” when it comes to these new bitcoin-based investment products.

Dalia Blass, director of the division of investment and management at the SEC, summarized the Commission’s concerns. Issues around the accurate valuation of cryptos—especially in instances of forks and airdrops—maintaining sufficient market liquidity, ensuring safe custody of customer funds from hacking, and guarding against market manipulation were all points Blass expressed.

Bitwise responded to the SEC’s concerns with its widely circulated Bitwise report, which found that 95 percent of all cryptocurrency trading is allegedly the result of wash trading. The report also asserted that bitcoin itself is uniquely resistance to market manipulation, despite this consideration.

Meanwhile, in a July 2018 response to a request to list and trade shares of the Winklevoss Bitcoin Trust, if the SEC’s position remains unchanged, the agency does not agree that bitcoin “generally is less susceptible to manipulation than the equity, fixed income, and commodity futures markets,” as the Winklevoss filing suggests.

Details on the Bitwise ETF

The Bitwise exchange traded fund—which is a type of investment traded on a stock exchange—represents shares of bitcoin held in a trust, a legal entity which is responsible for administering these crypto-assets on behalf of shareholders.

The objective of the Bitwise bitcoin ETF is to broaden access to the crypto-asset to institutions.

These ETFs will actually be redeemable in its underlying bitcoin. Thus, shares of the ETF may have a greater impact on the supply and demand of the coin, unlike cash-settled futures from the Chicago Mercantile Exchange (CME).

To ensure each share is always backed by underlying bitcoin, Bitwise plans to process all share creation and redemption, and accrue all fees, in bitcoin rather than fiat.

Bitwise will price the ETF based on spot prices of 10 bitcoin exchanges which it asserts represents “all of the economically significant spot trading volumes on bitcoin exchanges around the world.” The metric discounts over 150 exchanges said to report fake trading volumes.

“Bitwise considers the questions raised by the SEC… to be thoughtful and insightful,” said a Bitwise representative to CryptoSlate. “We appreciate the SEC’s efforts to gather comprehensive ETF information about both the bitcoin market in general and Bitwise’s specific filing, and encourage all experts with relevant answers to engage in the comment process.”

At the earliest, the SEC will deliberate on the application again when comments close on June 19.

Updated May 15, 0100 UTC: Added comments from Bitwise.

https://cryptoslate.com/bitwise-bitcoin-etf-delayed-five-weeks/

Altcoin Trader: Alt Bitcoin Bear Cycle Almost Over, 600% Gains During Bull Cycle Expected

While Bitcoin has the entire crypto world watching in shock and awe as the seemingly unstoppable rally continues, its crypto cousins in the altcoin market have only further dropped relative to their BTC ratio.

However, according to previous altcoin/BTC bear cycles, an end to the carnage may be in sight. And once the bearish momentum eases up, the following uptrend has brought investors over 600% gains once altcoins join Bitcoin in a bull run.

Altcoin Bear Cycle Coming to a Close as Drawdown Nears Peak

Due to Bitcoin being paired with altcoins on most exchanges, the two crypto asset types have a closely tied relationship between one another, however, the relationship between altcoins and their big brother Bitcoin is a confusing one. At times, they rise and fall in a completely correlated way, while other times they appear to grow or decline inverse from one another.

As soon as Bitcoin broke through resistance at $4,200 at the start of April, causing the crypto asset to rally nearly 100% to over $8,300, altcoins diverged, and hard. While Bitcoin rose, most altcoins fell significantly in their ratios relative to BTC.

While Bitcoin has went on to set new yearly highs, altcoins continue to set new yearly lows in their BTC ratios. The total altcoin market cap drawdown has been 66.5% so far, according to experienced altcoin trader Nik Patel, who is the author of the book an Altcoin Trader’s Handbook.

https://twitter.com/cointradernik/status/1128273060358971392

The trader says that during the four previous “ALTBTC bear cycles,” all have had an average drawdown of nearly 70% – a mere 3 and a half percentage points away from current levels. This could indicate that the selling pressure is almost exhausted, and that a new bull cycle could begin.

If and when a bull cycle does come to fruition in the alt market, according to the altcoin trading professional, the average growth experienced has resulted in bringing investors as much as 617% gains. Such gains would bring the price of Ethereum to over $1,200 and near its previous all-time high, and the price of Ripple to $2.40 cents per XRP. Litecoin would be priced at well over $500 per LTC.

Gains of such nature haven’t been witnessed in the crypto market since the start of 2018. After that, the market crashed and the longest bear market on record ensued. It’s only now that the early stages of a new bull market have started, with the first ever cryptocurrency Bitcoin leading the charge, that such growth in the market has started showing signs of life once again. If altcoins can rally similarly to Bitcoin from here, the crypto bull market will be back, and the price of cryptocurrencies could reach new all-time highs across the board.

https://www.newsbtc.com/2019/05/15/altcoin-trader-bitcoin-bear-bull/