Deutsche Bank: ‘End of Fiat Money’ May Be Near

Deutsche Bank:
‘End of Fiat Money’ May Be Near

A top Deutsche Bank strategist speculates

that we may be looking at the “start of the end of fiat money”. Bitcoin was originally developed as a peer-to-peer electronic cash system that would free its users from the bondage of state-controlled currency and the erosion of wealth due to inflation. Despite its phenomenal growth, most mainstream financial analysts remain skeptical that it will ever achieve mainstream adoption – at least as a currency used for everyday transactions.

However, as Business Insider reports, Deutsche Bank strategist Jim Reid envisions that the current fiat monetary system could begin to collapse within the next decade, creating a climate that would encourage the rise of an alternative currency system.

Reid made this shocking claim in a recently-released research paper, and he argues that the current fiat monetary system – which began in 1971 when U.S. President Richard Nixon decoupled the dollar from gold — is “inherently unstable and prone to high inflation”. The corrosive effects of inflation have largely been masked in major economic markets, primarily due to the meteoric growth of China’s economy and the global working-age population. He says that these factors created a situation in which central banks could control inflation externally and prevent wages from

increasing too rapidly.

“It’s not usually this easy as inflation would have normally increased with such stimulus and credit creation,” Reid writes. In fact, “it could be argued that this external disinflation shock has perhaps ‘saved’ fiat currencies.”

demographic and developmental cycle slows or reverses, it “could spell problems for the fiat currency system,” he continues, “which could herald in the beginning of the end of the global fiat currency system”.

Opportunity for Alternative Currencies

Reid anticipates that central banks may seriously consider a shift to a commodity-backed monetary system within the next decade, vindicating the gold bugs who have been marginalized and ridiculed by mainstream financiers. However, the economy looks quite different than it did in 1971, and many bitcoin advocates believe that the emergence of the digital age necessitates a digital currency. Acknowledging this, Reid says it is possible that cryptocurrency or another alternative medium of exchange could eventually supplant paper money, although he stops far short of predicting that this new system will be based on bitcoin.

“Although the current speculative interest in cryptocurrencies is more to do with blockchain technology than a loss of faith in paper money, at some point there will likely be some median of exchange that becomes more universal and a competitor of paper money,” Reid concludes.

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Bitcoin-Only Property Sale: UNESCO World Heritage Site in Ibiza for 1,850 BTC

Bitcoin-Only Property Sale: UNESCO World Heritage Site in Ibiza for 1,850 BTC

When a Texas-based real estate brokerage firm sold a property using just Bitcoin,

the ease of transaction became topical. "In a matter of 10 minutes," says Sheryl Lowe, the agent who represented the buyer in the sale, "the Bitcoin was changed to US Dollars and the deal was done!" The same factor is playing out again. Handlers of the sale of a historic palace in the Spanish resort town of Ibiza are banking on the ease of Bitcoin to put the property on the market.

El Palacio Badarji is on sale for 1,850 Bitcoin. No cash equivalent indicated. The location which was declared a World Heritage site by UNESCO in 1999 is an 18th-century palace built in 1740. It's been renovated in the last few years. Yet, its four en-suite bedrooms, a master suite with private lounge room and a living room with reception area as well as other parts are intact.

Ease of use

The ease of use is a major factor that would continue to cause leading real estate brokerage to look keenly in the digital currency's direction. This is considering the hassles that always go with the sales of real estate ownership especially across borders. Just last month, a mansion in London was put on the market for £17 mln. Its sales notice stated that the potential buyer has to pay in Bitcoin – about 5,050 BTC at the time. Lev Loginov, who put the property up for sale, talked about transactions in Bitcoin being "…done quicker, more efficiently and it is much easier to deal with than using banks, which are putting in unnecessary over-regulation."

British entrepreneurs, Michelle Mone and Doug Barrowman, also launched a Bitcoin-priced real estate development in Dubai. Mone sees a time when early adopters will give way to a more mainstream application of cryptocurrencies. Hence, "… it's a logical extension to take land and buildings and effectively offer people the opportunity to pay in cryptocurrency or bitcoin rather than just fiat currency." Some of the other Blockchain-backed projects with interests in the real estate market include Propy, Atlant and Brickblock. Propy's decentralized title registry platform was recently used in the sale of an apartment in Ukraine, while Brickblock plans to offer the world’s first tokenized real estate project – an apartment block in Berlin going on sale in December.

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Short-Lived Rebound? Bitcoin Struggles to Retake $7,200

Bitcoin traders seem a touch tentative today.

At press time, the bitcoin-U.S. dollar (BTC/USD) exchange rate is at $7,200 levels. BTC prices dropped to a four-day low below $6,950 yesterday before regaining poise, although the 5-day moving average (located above $7,200) is proving tough to crack. So has the pullback run out of steam? Comments on social media indicate that, while some traders see the potential for a healthy correction to $6,500, others predict the market is likely to stay volatile ahead of the expected Segwit2x hard fork. The odds seem high that the pullback has legs, given that the sell-off on Monday was backed by a 30 percent surge in volumes. A high-volume price drop usually means the investors sold in large quantities and is considered a negative indicator.

However, Google search volumes have declined over the last 18 hours, perhaps validating the argument that the retreat from the record highs is anything but "panic selling." Search volumes tend to go up during such events as investors scout for information. Meanwhile, the price action analysis indicates bitcoin is likely to witness consolidation with downside bias over the next couple of days.  As it shows Bearish doji reversal, Relative strength index (RSI) is still overbought, 5-day MA is offering strong resistance, A confluence of 10-day MA and the trend line support at $6,868.

A bearish doji reversal occurs when a doji candle (one with a virtually equal open/close price) is followed by a negative price action on the following day. On the above chart, Sunday's doji candle was followed by a big red candle on Monday. The doji reversal confirmation indicates the stellar rally in BTC may have run out of steam, and that prices could drop to $6,868 and $6,500 levels in the next couple of days. However, dips below $6,868 are likely to be short-lived, given the 10-day MA still favors the bulls (slopes upwards). On the higher side, only a sustained move above $7,500 would open doors for a rally towards $8,000.

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BP, Shell lead plan for blockchain-based energy trading platform

BP, Shell lead plan for blockchain-based energy trading platform

 A consortium including energy companies BP and Royal Dutch Shell

will develop a blockchain-based digital platform for energy commodities trading expected to start by end-2018, the group said on Monday. The logo of BP is seen at a petrol station in Kloten, Switzerland October 3, 2017. REUTERS/Arnd Wiegmann. Other members of the consortium include Norwegian oil firm Statoil, trading houses Gunvor, Koch Supply & Trading, and Mercuria, and banks ABN Amro, ING and Societe Generale.

Blockchain technology, which first emerged as the architecture underpinning cryptocurrency bitcoin, uses a shared database that updates itself in real-time and can process and settle transactions in minutes using computer algorithms, with no need for third-party verification. Mercuria has been a vocal advocate of implementing blockchain technology to significantly cut costs in oil trading. “Ideally, it would help to eliminate any confusion over ownership of a cargo and potentially help to make managing risk more exact if there are accurate timestamps to each part of the trade,” said Edward Bell, commodities analyst at Dubai-based lender Emirates NBD PJSC.

Similar efforts for an energy trading platform have failed to take off, Bell said, but added this latest bid with backing from BP and Shell and the banks, “may have more success than if it were an independent party trying to convince oil and gas companies to make use of it.” The new venture is seeking regulatory approvals and would be run as an independent entity, the consortium said in a statement. “The platform aims to reduce administrative operational risks and costs of physical energy trading, and improve the reliability and efficiency of back-end trading operations…,” the statement said.

World needs new rules for powerful tech

Paddy Cosgrave, co-founder of Web Summit, attends an interview with Reuters in Lisbon, Portugal, whose annual Web Summit takes place in Lisbon this week, joins growing calls for tighter regulation of big technology firms especially after news that Russia may have manipulated the last U.S. election with political advertisements on Facebook. He said recent initiatives by European Commissioner for Competition Margrethe Vestager could bring big changes for big tech companies and help level the playing field in a sector which is having a profound impact on societies.

Vestager, who will speak at the Web Summit on Tuesday, has levied huge fines for unpaid taxes and unfair competition on big technology firms, including Apple, Google and Amazon in the past couple of years. “In economic terms these (companies) would appear to fall into a classic definition of monopolies,” Cosgrave told Reuters in an interview.  “And if she (Vestager) is successful she will probably set the standard for the rest of the world and will usher in a fundamental change in how the largest and most profitable companies in the history of the world are treated. This changes the playing field for all other companies.”

Cosgrave said that new technology had been assumed by many to be just positive, but it often “can be incredibly disruptive”. He said the need for new rules was similar to past technological shifts such as the invention of cars. “We had an operating system that, by and large with some modifications every decade, worked for the last 200 years,” Cosgrave said. “And then suddenly, you’d have to be naive or have your head buried in the sand, to not realize that the very fabric of our society, certainly western society, feels like it’s getting pulled and stretched in weird ways. I think we need … a new operating system.”

Web Summit has grown into one of the world’s largest technology conferences, from 400 participants when it started in Dublin in 2010, to 59,000 participants this week. It started as a venue for tech startups and includes investors, but also increasingly politicians and regulators. U.N. Secretary General Antonio Guterres is scheduled to attend the Lisbon summit.

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ETF Firms File to Create Blockchain Investment Products

Two firms specializing in exchange-traded funds (ETFs) filed

with the U.S. Securities and Exchange Commission to create blockchain-related vehicles this past week. Reality Shares Advisors, a subsidiary of Reality Shares ETFs, plans to work with Nasdaq Inc. to offer securities for different blockchain companies. Similarly, Amplify Trust ETF also filed for permission to invest and trade in blockchain startups. Neither company completed their prospectus applications, but they both indicated they would exclusively invest in different blockchain companies.

According to Reality Shares’ application:

“Blockchain technology may be used to support a vast array of business applications in many different industries and markets, and the extent of its versatility has not yet been fully explored. As a result, the Index may include equity securities of both operating and non-operating companies.”

Both companies noted that, due to the early-stage status of the technology, investing in it could prove risky, particularly since there is no regulation surrounding the space and some blockchain-based services may not turn a profit.

The two applications shared several common details, including the stipulation that only companies with market capitalizations greater than $200 million and a six-month daily trading average of at least $1 million would be considered for the fund. Neither prospectus is complete, and both companies included disclaimers stating that the details of their indices may change. The companies need to complete the forms, and the SEC has to rule on each application before either organization can begin offering securities to investors.

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How to Protect Yourself From the CryptoShuffle Trojan

How to Protect Yourself From the CryptoShuffle Trojan

Russian based cybersecurity firm Kaspersky Labs has warned owners

of cryptocurrencies that their coins are not safe even in private wallets. A new trojan called CryptoShuffler is stealing coins right from under the noses of users by replacing wallet addresses on a user’s clipboard as they copy and paste wallet data for transfers. No wallet is safe because the trojan utilizes the clipboard function on computers. The trojan has already caused a substantial amount of damage in just a short time, though the cyber researchers believe the trojan has been working for perhaps a year or more.

Per Kaspersky:

“…cybercriminals have already managed to steal 23 Bitcoins, which is the equivalent of approximately $140,000 (as of the end of October). In addition, thousands of dollars of other cryptocurrencies such as Litecoin, Dash, Monero, Ethereum, Zcash and Dogecoin, have been accumulated.”

Protect yourself

The most basic way to protect yourself is to carefully compare the address you’ve inputted after copying. Carefully checking wallet addresses for every transaction should keep your funds safe. However, the trojan developers know that the normal process is simply to copy, paste and send, without carefully checking the address. For this reason, Kaspersky is warning users to take special precautions. Further, users are advised to utilize an antivirus and anti-malware system in order to detect and remove malicious programs. As the cryptocurrency world continues to grow, risks will continue to increase, and owners will need to be vigilant to protect their funds.

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Bjork’s Latest Album Available Only With Cryptocurrencies, Shows Adoption

Bjork’s Latest Album Available Only With Cryptocurrencies, Shows Adoption

Known for embracing all things edgy,

musician Bjork has announced that her latest album, Utopia, will be available for purchase only through cryptocurrencies. The artist will accept Bitcoin, Litecoin, DASH, and AudioCoin. Interestingly, the album cannot be purchased using normal fiat currencies. The move by the musician may seem like a marketing strategy of sorts to appear unique and to draw attention during a time when Bitcoin’s rise has brought cryptocurrencies into the mainstream. However,

according to Kevin Bacon of Blockpool:

"This really isn’t a marketing strategy with Björk. This is a decision to be a leader. In fact, it’s just the obvious thing to do for her. If I wasn’t involved in this project, I’d expect Björk to be a leader in this area, and for her team to be doing creative things with crypto.”

Virtuous Satoshi cycles

As adoption of cryptocurrencies increases, the price and number of transactions increase, causing greater price stability, and stability increases mainstream adoption. This process of adoption and stability has been referred to as a Satoshi cycle, and is the underlying driver for the increase in Bitcoin price. Bjork’s album offering is simply another step in the ladder of adoption and stability. As the cryptocurrency market continues to gain traction, prices follow the adoption curve and drive the adoption curve concurrently.

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Bitcoin Bulls Get More Bullish, Ronnie Moas Revises Bitcoin Price Prediction

Bitcoin Bulls Get More Bullish,
Ronnie Moas Revises Bitcoin Price Prediction

Bitcoin's stupendous rally in 2017 has clearly enthused the supporters of Bitcoin.

Standpoint Research’s Ronnie Moas, who is one of the most bullish analysts on Bitcoin, has revised his prediction upwards.

$7,500 by year end? Oops, we are almost there!

Ronnie Moas had surprised observers by his bold prediction in July 2007 that Bitcoin could reach $5,000 within months. The price was less than $3,000 when he made the prediction, but it jumped up to over $5,000 in Sep. 2017 before retracing briefly. In August 2017, the rapid increase in Bitcoin price led to Ronnie Moas revising his projection to $7,500 by the end of 2017. Bitcoin's rapid increase in price has dwarfed that projection as well, with Bitcoin price crossing $7,400 today. Ronnie Moas has now revised his projection, raising it to $11,000 in 2018.

In an email to his clients, Ronnie wrote:

Every day more headlines are hitting the newswires on crypto. More countries are embracing it, and the few obstacles that were standing in the way are falling down like dominoes.

Long-term: digital gold

Ronnie Moas is ultra-bullish about Bitcoin's potential in the long-term and believes that it will rival gold one day. He has predicted that its price will cross $20,000 in three years time and $50,000 in 10 years time. Given the current bull run of Bitcoin, he might even shorten the time frame projected for Bitcoin to reach those levels. While Apple might be the company with the highest market capitalization and whose value is reaching record levels each day, Ronnie believes that Bitcoin will overtake Apple in just five years.

Increased awareness and investment will drive price rise

Ronnie believes that the price increase will be driven by increased awareness of Bitcoin and a larger proportion of the world's population investing in it. It is estimated that less than 0.5 percent of people currently have invested in Bitcoin and Ronnie believes that this could increase to five percent. Since the supply of Bitcoins is fixed, the demand-supply imbalance will cause the price to soar. Bitcoin's current rally has clearly divided people into two opposing camps, with the bulls becoming more bullish and the bears crying bubble.

UK Mint Reveals Live Gold-
Tracking Blockchain

The Royal Mint of the United Kingdom has just revealed

their live gold tracking mechanism built with Blockchain technology. The tracking system had its first genesis block on Aug. 2 and while still not yet available to the public, has verified more than 50,000 blocks. The Blockchain technology based tracking system is designed to keep records of sales and ownership of the precious metal – a task that is relatively complex. The system has been built with a number of careful additions in order to reduce any risk to relatively zero. Here are some points of the report:

  • The RMG network will require multiple, independent cryptographic signatures to enact any transaction thereby keeping RMG safe from loss of a single-key. Due to the way the Blockchain enforces the addresses, it is not possible to send RMG to an invalid destination where the RMG could not be recovered.
  • The Asset Trading Platform is secured by industry cyber-security practices and controls, which are informed by global frameworks such as NIST and ISO.
  • All parties participating on the network are identified.

The project was first unveiled as potential in 2016. The recent statement indicates the power of Blockchain technology to both protect and secure even physical assets. The senior marketing manager Nicola Robinson rightly stated, "It's simple, it's so simple, it's just a digital representation of real gold. The most exciting thing about RMG is that it's live, it's out there, it's working."

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Bitcoin Exchange Coinbase adds 100,000 users in 24 hrs, Shows Surging Interest in Crypto

Bitcoin Exchange Coinbase
adds 100,000 users in 24 hrs, Shows Surging Interest in Crypto

The announcement by CME that it plans to launch Bitcoin futures

has resulted in a spike in interest across the world. Coinbase, the world's largest Bitcoin exchange, has added 100,000 new users in the 24 hours past the announcement.

Why Coinbase matters

Coinbase is a popular exchange to buy Bitcoins with 11.9 mln users supported across 32 countries. It was one of the earliest exchanges to support Bitcoin trading in the Western world, doing so when Bitcoin was valued in single digits. It supports merchants as well, allowing them to accept Bitcoins for their products and services, but removing the price risk by crediting fiat currency to their accounts. Coinbase became the first unicorn of the crypto industry after it raised $100 mln in August 2017, implying enterprise valuation of $1.6 bln. The CEO of Coinbase, Brian Armstrong, is also on Fortune’s 40 under 40 list.

The Stampede

The launch of Bitcoin futures by CME is expected to bring a deluge of institutional money into Bitcoin. Individual investors seem to be stampeding towards Bitcoin exchanges, trying to get their hands on Bitcoins before institutional investors make it out of reach. According to data compiled by Alistair Milne, of the Altana Digital Currency Fund, over 100,000 new users have joined Coinbase in the 24 hours since the CME announcement. The exploding Bitcoin price has resulted in a sharp increase in the number of users of Coinbase, which has already doubled in 2017 to reach 11.9 mln users.

Handling the surge

With hundreds of thousands of new users, the demand (and price) of Bitcoin is expected to eventually explode. It is estimated that currently less than 0.5 percent of the global population is invested in crypto space. While Coinbase has insurance protection for cryptocurrencies saved on its servers, questions will be asked about the robustness of its trading platform. A flash crash caused by a large order on Coinbase’s GDAX exchange resulted in Ethereum's price dropping to 10 cents for a short period of time, triggering stop loss orders. With increasing number of users, it is not just Bitcoin which is running full blocks and has a scalability problem; Bitcoin exchanges have to scale up too.

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Bitcoin jumps $400 in one day and soars to a new record high

Bitcoin jumps $400 in one day and soars to a new record high

  • Bitcoin reached a renewed all-time high of $7,454.04 at 6:40 a.m. Friday, after opening at $7,030
  • The virtual currency shot past $7,000 for the first time on Thursday

Bitcoin skyrocketed past $7,400 on Friday, hitting yet another record high.

The virtual currency had shot past the $7,000 mark for the first time Thursday and finished on $6,895.41 toward the end of the session. According to CoinDesk, the cryptocurrency reached a renewed all-time high of $7,454.04 at 6:40 a.m. ET Friday, after opening at $7,030. The jump in price saw bitcoin rise 6 percent.

Analysts believe more institutional investors could warm to the digital token after derivatives operator CME Group announced it would introduce bitcoin futures contracts this year. "This is bitcoin crossing the divide from the wild west of finance to the mainstream," Charles Hayter, CEO of cryptocurrency comparison website Crypto Compare, told CNBC in an email Thursday. "Futures from an incumbent exchange bring bitcoin and cryptocurrencies into the regulatory fold. This allows more complex financial products to be created and will eventually open the doors to institutional money."

CME's futures will be cash-settled and based on the CME CF Bitcoin Reference Rate (BRR), launched in November last year with Crypto Facilities, a digital cryptocurrency trading platform. The bullish activity that followed CME's announcement also saw the total value of all cryptocurrencies surge past $200 billion for the first time. The market cap of bitcoin alone is more than $124 billion. Bitcoin's price has risen 640 percent since the start of the year.

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