Your dose of crypto news and analysis from @BTO and @Goldfinger

According to 99bitcoins.com, Bitcoin has died 217 times. And at the time of writing, the most recent reported death came on Dec. 15, 2017, so those 217 deaths don't even include today's obvious death, which we'll call the "Christmas 2017 Crypto Crash". RIP Bitcoin. We will miss you.

But seriously, what a rollercoaster it was this week if you were invested in the crypto markets, or even just watching from the sidelines.

I’m beginning to think we hit the nail on the head with the title of this publication. There are real, ongoing crypto wars at all times, resulting in chaotic shifts in value (and incredible trading opportunities for the savvy).

Bitcoin Cash (BCH) — the crypto birthed out of Bitcoin’s (BTC) hard fork this past summer — went crazy on news that Coinbase would let its users buy and sell. Last Friday, it was sitting at around US$1,780, and following the news (or maybe little bit before) it started to pop — and I mean POP. It went to over US$4,000 in very short order, with BTC resultantly taking it on the chin before rising again.

And now today the whole world is exploding:

But — as always in turbulent times — let’s take a minute and ask Andreas what he thinks:

So, stay f#*@ing calm!

With the games being played (e.g., BTC vs BCH) and the FOMO and the FUD, let's take a step back and look where we've come from in just the past few months. And, I mean, the cryptocurrency world as a whole. There's no point in looking at the chart of a single crypto and crying wolf about the whole sector. You need to consider the space in its entirety:

When considering events like today's sell-off, let's not forget that just 3 months ago, the global market cap of all cryptos was at around $120 billion. AND THAT WAS AMAZING!!! It's now at roughly US$540 billion after hitting an all-time high LESS THAN 48 HOURS AGO of around US$640 billion. Yes, this $$ dip is large and wild, but the space is still up over 300% in just a few months! Get used to the volatility because...

And:

Even with today's dip, let’s take a look at the performance of the major cryptos this week (last Friday to today) - note that many are still UP or FLAT on the week:

  • Bitcoin trading around US$14,200, down 20% on the week
  • Ethereum trading around US$690, flat on the week
  • Ethereum Classic trading around US$32.55, up 7% on the week
  • Bitcoin Cash trading around US$2,900, up 64% on the week
  • Dash trading around US$1,250, up 40% on the week
  • Litecoin trading around US$277, down 10% on the week
  • Monero trading around US$340, up 9% on the week
  • ZCash trading around US$530, up 15% on the week

The numbers just aren't that scary, are they? And, in any event, with ALL of the top 30 cryptos going parabolic and hitting all-time highs this week (they're all down from those levels), it was time for a correction. This is healthy.

And remember the dot-com bubble? Here is some perspective on that:

WTF did I miss this week in crypto?

Small South Korean cryptocurrency exchange Youbit is shutting down after a second hack — http://www.businessinsider.com/south-korean-cryptocurrency-exchange-youbit-shutting-down-after-second-hack-2017-12

Youbit, a small South Korean cryptocurrency exchange, filed for bankruptcy and announced that it's shutting down, after suffering its second major cyberattack and theft this year. The exchange previously had 4,000 Bitcoins, worth about $73 million, stolen in April, and announced another breach on Tuesday morning. Be careful out there, friends.

Hedge Fund Pro Miller Is '50 Percent' Invested in Bitcoin — https://www.coindesk.com/hedge-fund-pro-bill-miller-just-about-50-percent-invested-in-bitcoin/

Investor Bill Miller said last week that his MVP1 hedge fund (around US$154 million as of October) has half of its investments in bitcoin.
And according to Morgan Stanley, hedge funds have poured US$2 billion into cryptos in 2017. For one such hedge fund, the return has been 25,004% since 2013 according to the NY Times. Boom!

SEC Halts Crypto Stock Over Manipulation Concerns After Massive Jump — https://www.bloomberg.com/news/articles/2017-12-19/sec-halts-crypto-over-manipulation-concerns-after-2-700-jump

U.S. regulators temporarily suspended trading in an obscure digital currency company aptly called The Crypto Company due to concerns that its stock is being manipulated after surging more than 17,000% in less than three months.

Ethereum Breaks One Million Transactions in a Single Day — https://discover.coinsquare.io/tech/ethereum-one-million-transaction-day/

On Tuesday, the Ethereum network made history by processing over one million unique transactions in a 24-hour period. No other crypto has hit this threshold. However, I'd say in 2018 we'll see others hit it, especially Bitcoin if the Lightning Network launches to enable fast and cheap micro-transactions.
You can watch Elizabeth Stark, Lightning Labs co-founder and CEO, explain how the company is building its version of this payments system on top of Bitcoin here.

Estonia, The Digital Republic — https://www.newyorker.com/magazine/2017/12/18/estonia-the-digital-republic

There was a really neat long read in the New Yorker this week on the tiny post-Soviet nation of Estonia and its increasingly virtual, borderless, blockchained, and secure governmental structure. I highly recommend you read the piece over the holidays. The country is ahead of the curve on many fronts, one of which is its plan to launch its own cryptocurrency, called ‘estcoin’, in a bid to become global ICO hub. More on that here. I'd say we'll see more countries seriously considering taking such a step in 2018.

Buy, sell, send and receive Bitcoin Cash on Coinbase — https://blog.coinbase.com/buy-sell-send-and-receive-bitcoin-cash-on-coinbase-65f1b2c7214b

This, the official announcement from Coinbase re: adding Bitcoin Cash (BCH) support, set off quite a firestorm of activity this week. First, the BCH price went crazy on GDAX (Coinbase's exchange), up to nearly US$9,000, which provoked the company to disable trading of its newest asset. Then we had allegations that Coinbase tried to kill Bitcoin (BTC) and of collusion between CNBC and BCH backer Roger Ver. And lastly, claims that employees of Coinbase had engaged in insider trading ahead of the official announcement from the company, which the company is now investigating internally. I'm still taking all of this in...

The most mind-blowing cryptocurrency ICO of all time is going on right now — http://www.businessinsider.com/biggest-cryptocurrency-ico-ever-going-on-right-now-2017-12

If true, wow! Block.one, a software startup registered in the Cayman Islands and lacking a central office, has accomplished an astounding feat: So far, it has extracted $700 million in real money from the global public by selling tokens, called EOS, in an initial coin offering. It is by far the largest ICO ever.

A Cryptocurrency Founder Sold All His Coins After 7,500% Rally — https://www.bloomberg.com/news/articles/2017-12-20/after-7-500-rally-cryptocurrency-founder-sells-all-his-coins

In another controversial piece of news this week, Charlie Lee (@SatoshiLite on Twitter), the creator of Litecoin, suddenly announced that he had "sold and donated" his LTC holdings over the preceding days. He says his aim was to prevent a "conflict of interest" when he makes comments on social media. Said Lee: “Litecoin has been very good for me financially, so I am well off enough that I no longer need to tie my financial success to litecoin’s success. For the first time in six+ years, I no longer own a single LTC” (other than, apparently, a few collector’s coins).

The cryptocurrency market is now doing the same daily volume as the New York Stock Exchange — http://www.businessinsider.com/daily-cryptocurrency-volumes-vs-stock-market-volumes-2017-12 

I can't say I'm totally surprised that this is the case, but it's remarkable nonetheless. 24-hour trade volume in the cryptocurrency markets passed the US$50 billion mark on Wednesday, according to coinmarketcap.com. We still have a ways to go to catch up to the foreign-exchange market, which has daily volumes of over US$5 trillion. Wow!

Goldman Is Setting Up a Cryptocurrency Trading Desk  — https://www.bloomberg.com/news/articles/2017-12-21/goldman-is-setting-up-a-cryptocurrency-trading-desk

It seems at least one of the Wall Street giants is growing comfortable with crypto as a new asset class. News broke this week that Goldman Sachs is now assembling a team to establish a trading desk to make markets in digital currencies such as bitcoin. It aims to have the business up and running by the end of June 2018. 

A bitcoin millionaire’s fortune will fund psychedelic research, a cure for aging, and clean water — https://qz.com/1160997/a-bitcoin-millionaire-is-giving-away-a-fortune-to-psychedelic-research-curing-aging-and-clean-water/

Finally, some other non-FUD news to make you feel a little better about the crypto world. Last week, a cryptocurrency enthusiast named “Pine” founded the $86 million (5,057 BTC) Pineapple Fund (motto: “Because once you have enough money, money doesn’t matter.”). As of Dec. 19, the Pineapple Fund had committed about $8 million to eight charities. The anonymous philanthropist will reportedly donate a “majority” of his or her cryptocurrency holdings, according to the website. “I still don’t believe reality sometimes,” Pine writes on reddit. “Bitcoin has changed my life, and I have far more money than I can ever spend.”
The Pineapple Fund will focus on medical research, mental health, wildlife and environmental conservation, fighting domestic violence and sexual abuse, and technology-related causes.
Here is another article containing a Q&A with Pine. :)

Coins and tokens and stocks, oh my!

[Note — Net change and % change figures are from the close last Friday to the close today.]

HIVE Blockchain (TSXV:HIVE) — $HIVE — Net Change: -$0.18; % Change: -5.1%

Very quickly following its announcement of a HUGE $115 million financing, HIVE closed on a first tranche of $50 million. Its share price responded, surging above $4.00 briefly, and then traded in the high $3's until the Christmas 2017 Crypto Crash (i.e., today). I'll be looking out for news next week on the closing of the final $65 million, following which HIVE will be cashed up and ready to embark on their expansion plans in 2018 with a lot of dough left in the till.

HashChain Technology (TSXV:KASH) — $KASH — Net Change: +$1.52; % Change: +101.3% [Note — Reflects change from opening of trading on Dec. 18 at $1.50 to the close today.]

I mentioned the latest crypto miner on the block — $KASH — in last week's Crypto Wars. It's focus is on Dash and Bitcoin. Its first day of trading was Monday, where it opened at $1.50 and surged as high as $4.40. It finished the week at $3.02. It reminded the market today in a short news release that crypto mining remains profitable even at much lower prices than the current dip. This applies equally to any sophisticated, large-scale miner, such as HIVE.

Overstock (NASDAQ:OSTK) — $OSTK — Net Change: -US$2.50; % Change: -3.7%

OSTK continued its rise this week on the strength of the ongoing token sale by its >80%-owned subsidiary, tZERO. That is, until the Christmas 2017 Crypto Crash. The stock hit a high of US$82.70 on Tuesday and finished the week off at US$65.70.

Mogo Finance (TSX:MOGO) — $MOGO — Net Change: -$0.76; % Change: -10.5%

MOGO announced this week that it is launching a Bitcoin giveaway as part of promoting the launch of its upcoming crypto product called MogoCrypto. Of course, like most other crypto plays, its share price suffered from the Christmas 2017 Crypto Crash, but hopefully it will be able to make a splash when the product launches in 2018. You can check it out here for the time being.

Other crypto/blockchain-related stocks riding the wave:

  • MGT Capital (OTC:MGTI) — $MGTI — Net Change: +US$0.68; % Change: +16.2%
  • LeoNovus (TSXV:LTV) — $LTV — Net Change: -$0.065; % Change: -14.6%
  • Global Blockchain (TSXV:BLOC) — $BLOC — Net Change: -$0.41; % Change: -16.7%
  • BTL Group (TSXV:BTL) — $BTL — Net Change: -$3.01; % Change: -23.0%
  • NetCents Technology (CSE:NC) — $NC — Net Change: -$1.01; % Change: -29.5%
  • 360 Blockchain (CSE:CODE) — $CODE — Net Change: $0.00; % Change: 0.0%
  • Riot Blockchain (NASDAQ:RIOT) — $RIOT — Net Change: -US$3.60; % Change: -12.6%
  • eXeBlock Technology (CSE:XBLK) — $XBLK — Net Change: -$0.13; % Change: -9.3%
  • BIG Blockchain Intelligence Group Inc. (CSE:BIGG) — $BIGG — Net Change: -$0.22; % Change: -12.8%
  • And a few others that have been getting some attention: Atlas Cloud (CSE:AKE) - $AKE; Block One Capital (TSXV:BLOK) - $BLOK; Calyx Bio-Ventures (TSXV:CYX) - $CYX; ePlay Digital (CSE:EPY) - $EPY; LottoGopher (CSE:LOTO) - $LOTO; HealthSpace Data Systems (CSE:HS).

The CryptoTechnician Report

A wild week for cryptocurrencies and the assorted tangential cryptocurrency stock plays. We saw total cryptocurrency market capitalization nearly reach US$650 billion on Tuesday as Coinbase announced that Bitcoin Cash would be supported on the Coinbase platform. Before Coinbase shut down trading, Bitcoin Cash traded above $8,000 after trading near $2,000 just a few hours earlier.

We also saw the founder of Litecoin, Charlie Lee, decide to sell his entire position in Litecoin in order to avoid apparent conflicts of interest. So far Mr. Lee has made a good trade by selling his Litecoin above $300, literally 48 hours before it would be cut in half during the Christmas 2017 Crypto Crash.

The good news for Litecoin bulls is there is strong support below $200 for LTC and I would not be surprised if we've already seen the worst of the selling. Next resistance is $260 then $300.

Bitcoin suffered a nearly 50% from its highs earlier in the week to a low near $11,000. While the technical damage is significant (broken parabolic curve and a breach of multiple support layers), a bounce back rally to the $15,000 area would not be surprising. However, I doubt that we will see Bitcoin trade back above $16,000 until we at least ring in the New Year.

The 50% retracement level of the entire July-December rally should continue to offer strong support i.e. it will take a lot of selling pressure for Bitcoin to crack below $10,000 over the near term.

Ethereum continues to respect key technical levels; the overnight crash found support right at previous resistance near $500.

Similar to Litecoin I would not be surprised if the worst of the selling is over for Ethereum, however, I would also not be surprised if the $500 level is retested one more time before New Year's.

The tangential cryptocurrency equity plays had an insanely wild week with back-breaking volatility. Stocks which seemed to defy gravity early in the week suddenly fell like lead weights late in the week. RIOT Blockchain, one of the blockchain poster child stocks was more than cut in half as volatility soared.

A recent IPO called Longfin Corp. saw a more than 2000% rally in two trading sessions only to drop ~70% over the next four trading sessions after the CEO gave a remarkably hilarious interview on CNBC in which he admitted that his stock's valuation was "insane."

The Bitcoin Investment Trust, GBTC, which has long been the only way to play Bitcoin via the stock market, reached over $3,500 per share on Tuesday before proceeding to crash more than 65% over the next 72 hours. The reason for GBTC's outsized drop is the fact that GBTC has regularly traded at a large premium to the net asset value of the Bitcoin it holds. During crashes closed-end fund premiums have a habit of vanishing, and often times moving to discounts (trading below NAV).

More than any other chart, the GBTC chart looks like a crash. Rallies should be sold in GBTC until further notice.

Funny things we saw this week

Mastering Shitcoins: The Poor Man’s Guide to Getting Crypto Rich — https://hackernoon.com/mastering-shitcoins-the-poor-mans-guide-to-getting-crypto-rich-2e469b762ba9

Are you a Bitcoin billionaire?

Buy the f*#cking dip!

Happy Holidays everyone!

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