Kaseya and its clients were the victims of a ransomware attack in early July.
The company obtained a decryptor key and shared it with clients.
It still hasn’t said how it got the tool.
On July 2, IT software provider Kaseya was crippled by an attack attributed to Russia-based hacking group REvil. The ransomware compromised the software and removed the clients’ administrator access. REvil demanded $70 million in Bitcoin to restore normal operations.
Last week, it announced it had received the decryptor key to undo the attack, which affected hundreds of businesses that use Kaseya software worldwide. But itdeclined to say how—beyond that it had come from a “trusted third party,” leading to speculation that it had paid the $70 million ransom.
Not so, said Kaseya on Monday. “We are confirming in no uncertain terms that Kaseya did not pay a ransom—either directly or indirectly through a third party—to obtain the decryptor,” it said in anupdate on its website.
Others have paid such ransoms, despite warnings last year from the Treasury Department that paying hackers could be a violation of US sanctions against specific foreign actors.
Meatpacker JBS USA paid an $11 million Bitcoin ransom to REvil in June that threatened one-quarter of the country’s meat supply. A month prior, Colonial Pipeline paid a $4.4 million BTC payment to Russia-linked DarkSide, though it ostensibly did so after consulting with the Justice Department; federal law enforcement was able to recover some of the funds.
“While each company must make its own decision on whether to pay the ransom, Kaseya decided after consultation with experts to not negotiate with the criminals who perpetrated this attack and we have not wavered from that commitment,” Kaseya wrote.
“Kaseya decided after consultation with experts to not negotiate with the criminals who perpetrated this attack…”
That denial gives added weight to competing theories suggesting that Kaseya received the decryption tool via government backchannels. President Joe Biden has threatened Russia President Vladimir Putin with “consequences” should Russia choose not to act on ransomware attacks that take place within its borders. The U.S. has promised to share intelligence with Russia on the matter. REvil subsequently disappeared from the dark web.
Ransomware payments had cost companies this year the equivalent of $81 million, as of mid-May,according to blockchain tracking firm Chainalysis. That doesn’t account for the costs of network outages or working independently to restore service.
Vlad Tenev – the Chief Executive Officer of Robinhood – revealed that the company is looking to provide its customers with more cryptocurrency services such as a digital wallet. However, he did not specify when the firm would implement the new offerings.
Is Robinhood Expanding Its Crypto Scope?
The American financial services company – Robinhood Markets Inc. – is reportedly planning to offer more cryptocurrency options to its nearly 18 million users. During a recent public roadshow, CEO Vlad Tenev confirmed the news and highlighted digital assets as a basis of the firm’s future. He added that the customers have been showing growing demand in crypto wallets, so Robinhood would work towards that goal:
“We’ve been doing a lot of work behind the scenes to provide our crypto customers with the functionality that they’ve been asking for. We know you want wallets.”
Tenev mentioned that clients could expect the release of the long-anticipated wallets at “some point” and did not provide any specific timeline. Interestingly, a few months ago, the top executive assured Robinhood would launch the service “as fast as possible.”
Moreover, the retail investment app will reportedly introduce more offerings. Currently, users can not transfer virtual assets in and out of their accounts without the assistance of a cryptocurrency exchange, for example. Tenev asserted that Robinhood would fix this, outlining that it would strictly monitor every additional move out of safety reasons:
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“We want to introduce new features safely. And there’s a lot of items we have to get right from the start.”
Vlad Tenev, Source Wikipedia
Robinhood Users Love Dogecoin
The investing app, which is expected to go public this Thursday, recently announced that the popular meme coin – Dogecoin – accounted for 34% of its trading revenue. At the beginning of this month, Robinhood reported a 4% increase in revenue coming from cryptocurrencies. Interestingly, 30% of these earnings came from DOGE.
The Shiba-Inu-inspired coin surpassed market leaders such as Bitcoin (BTC), Ethereum (ETH), and Litecoin (LTC). Officials of the company warned that Dogecoin trading was so “substantial” that its potential decline in the future could have a highly negative impact on the company:
“If demand for transactions in Dogecoin declines and is not replaced by new demand for other cryptocurrencies available for trading on our platform, our business, financial condition, and results of operations could be adversely affected.”
Overall, the total revenue related to cryptocurrencies skyrocketed by more than 300% year-over-year, from $128 million to $522 million.
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Cardano (ADA) and Dogecoin (DOGE) have gained fast as the crypto market surges. The last 24 hours continue to be an interesting one for the crypto market as prices have surged across the board following a bullish run-up. Top coins like Bitcoin and Ethereum have seen massive price gains so far. The entire crypto market cap has seen over $1 billion added to it in just 24 hours.
As the run-up continues, altcoins like ADA and DOGE continue to show tremendous market movements. The price of both digital currencies has jumped over 10% each and continues to cruise higher as investors come back into the market. Bull traders have now taken over the market as bears record increasing losses.
Related Reading | Cardano Aims To Facilitate Users With Smart Contracts
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Shorts liquidations across the markets have crossed $1 billion, with liquidations in Dogecoin being the fourth-highest so far in the market. Altcoins continue to see recovering trends as most of the market turns towards green in this surprising turn of events this week.
Dogecoin, Cardano Continue Upward Trend
Dogecoin so far continues to lead the charge, posting a 13% price gain in the last 24 hours. DOGE which had continued to see downwards trends as the hype around the coin and ‘Dogefather’ Elon Musk died down has now broken out of the rut it seemed to have been stuck in for the better part of last week.
DOGE price moved from trading at $0.195 to breaking above $0.20, to be sitting at the current price of $0.2244 where it now trades currently.
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Crypto market gains over $1 trillion in 24 hours | Source: Crypto Total Market Cap on TradingView.com
Cardano (ADA) has continued in this vein to post gains of over 11% as the current rally rages on. The digital asset which had been trading for $1.20 had a tremendous run-up the saw the price hit $1.32 in a matter of hours.
Both digital currencies continue to show double-digit price gains in the market. Dogecoin market cap now sits at $29 billion as Cardano market caps experience gains to put it at $43 billion.
Bullish News Moving The Crypto Market Cap
The past week has seen more support coming out for bitcoin and other cryptocurrencies. News like billionaire Elon Musk confirming that Tesla and SpaceX hold bitcoin on its balance sheet has proven to be very bullish. The market had shown positive sentiment as the price of bitcoin had gone up after the announcement. Breaking $32,000 and maintaining a momentum that saw the price going past $34,000.
Related Reading | SpaceX Has Bitcoin On Its Balance Sheet, Elon Musk
In the same conference, Musk had confirmed that he personally held Bitcoin, Ethereum, and Dogecoin. Proving that the billionaire had never sold his holdings in the meme coin. Musk had also confirmed that while he may pump coins, he has never dumped his coins.
Hot on the heels of this came the news that Amazon was working towards integrating bitcoin into its platform. With cryptocurrencies being speculated to be a payment method for the e-commerce giant, sentiments had grown in favor of the crypto market and as such, investors seem to have returned to the crypto space with a renewed vigor.
Related Reading | Cardano (ADA) Launches Crypto Charity Platform With Rwanda-Based NGO
On Sunday, after rumors circulated that an insider from the e-commerce giant confirmed the integration of cryptocurrencies, prices surged as the weekend came to a close.
So far, the crypto market has seen continuing support as cryptocurrencies continue to maintain their gained value, and charts across the market remain in the green. Dogecoin and Cardano continue to top the list of gainers in the market.
Featured image from Nairametrics, chart from TradingView.com
Shopify partners will be able to sell NFT collectibles directly from their storefronts.
The functionality debuted with the Chicago Bulls’ NFT drop, which started today.
Shopify, a leading e-commerce platform that lets websites add storefronts and accept payments, has added support for NFTs, allowing store owners to sell the crypto collectibles directly without relying on an external marketplace.
Word of the NFT support comes from Shopify president Harley Finklestein, whotweeted about the newsvia his personal Twitter account today. He said that the official NFT drop from the NBA’s Chicago Bulls, which wasannounced late last week, marks one of the first examples of the tech being used by a Shopify partner. He said that the functionality isopen to “a select few”Shopify partners “for now,” but to “stay tuned.”
Introducing the Bulls NFT Legacy Collection.
Six NBA Titles.
Six Championship rings.
Six opportunities to own a Bulls NFT Championship ring starting on July 26th.
Get priority access and challenge reward details at https://t.co/WtDafr9rHv pic.twitter.com/xHZFPC7OPv
— Chicago Bulls (@chicagobulls) July 22, 2021
An NFT is a type of cryptocurrency that functions like a deed of ownership to a digital item, enabling scarcity for collectibles such as video clips, artwork, photos, tweets, and interactive video game items. Dapper’s NBA Top Shot has been one of the leading NFT projects to date, amassing more than $700 million in total trading volume since launching in fall 2020. Each Top Shot moment is an NBA video highlight packaged with animated flourishes and released in limited quantities.
The NFT market swelled near the start of the year and saw anestimated $1.5 billionin total trading volume in the first quarter of the year. Momentum seemed to slow into Q2, although DappRadar reports that the NFT marketultimately saw $2.5 billionin trading volume in the first half of the year.
“Before Shopify offered this capability, merchants would have to sell through a 3rd party marketplace a.k.a. less control of the sale and customer relationship,”Finklestein said today in a tweet. “Once again we are putting the power back into the hands of merchants and meeting customers how and where they want to buy.”
Before Shopify offered this capability, merchants would have to sell through a 3rd party marketplace aka less control of the sale and customer relationship. Once again we are putting the power back into the hands of merchants and meeting customers how and where they want to buy.
— Harley Finkelstein (@harleyf) July 26, 2021
TheChicago Bulls NFT collectionfeatures digital collectibles inspired by the team’s six NBA championship wins from the 1990s, each spread across multiple rarity levels. The first set, inspired by the team’s initial 1991 NBA Finals win, went on sale today and quickly sold out. Each NFT takes the form of a lightly animated video clip.
The Bulls NFTs are minted on Dapper Labs’Flow blockchain, which is also used for Dapper’s ownNBA Top Shotplatform. It’s currently unclear whether Shopify’s NFT support is limited to Flow or can also work with other blockchain platforms, such asEthereum.Decrypthas reached out to Shopify to clarify this detail and will update this article if we hear back.
Bull market optimism returned to the cryptocurrency market on July 26 after Bitcoin (BTC) price rallied above the $40,000 level for the first time in over six weeks.
Today’s rally to $40,581 was a continuation of the July 25 breakout which saw BTC price rocket to $48,110 at Binance af a short squeeze resulted in nearly $500 million in shorts being liquidated in just two minutes.
Data from Cointelegraph Markets Pro and TradingView shows that BTC spiked to an intraday high at $40,581 on Monday before pulling back to $37,500 as bulls look to flip this resistance zone back to support in preparation for a further move higher.
BTC/USDT 4-hour chart. Source:TradingView
While the move higher has the mark of a trend change and has prompted some analysts to proclaim the bull market is back on track, on-chain data and the perpetual funding rates do not fully concur with this point of view. Especially when one considers that the current breakout may have only been the result of a massive short squeeze.
Factors that could reignite the bull market
According to Élie Le Rest, partner at digital asset management firm ExoAlpha, the recently denied rumor that Amazon would accept cryptocurrency payments have the potential to have a similar effect as the 2020 revelation from PayPal that it would integrate cryptocurrencies. Le Rest said that if the Amazon news turns out to be true, this “could be the catalyst to ignite a bull run in H2 of 2021.”
As Bitcoin price pushed above the $35,000 level on July 25, “more than a billion dollars of shorts got liquidated in the past 24 hours, with the bulk of the liquidation occurring in less than 1 hour” according to Le Rest, who also said, “the current market move could be sustained during the week by volumes coming from players having waited for a more directional trend on Bitcoin since the end of May.”
Le Rest said:
“To validate this directional trend, Bitcoin has to break out of the $30,000-$40,000 range it has been stuck into for 2 months. Maintaining Bitcoin over the $40,000 level would signal that the “bear market” is over and the bull-run may resume.”
If Bitcoin is able to maintain its current momentum, Le Rest said “as many expect, Bitcoin could get back on track with the Stock to Flow model and reach the $100,000 mark by year-end.”
On-chain data is not so bullish
Caution is warranted against being overly bullish and data from Glassnode suggests that several bearish threats remain valid.
When analyzing the directional bias of the futures markets, Glassnode found that “perpetual funding rates have continued to trade negative,” which “indicates the net bias remains short Bitcoin.”
Bitcoin futures perpetual funding rate for all exchanges. Source:Glassnode
Glassnode said:
“This metric in particular helps us identify that Monday’s price rally is likely associated with an overall short squeeze, with funding rates continuing to trade at even more negative levels despite price rallying +30%.”
Glassnode also pointed to Bitcoin on-chain activity and highlighted that “in direct contrast to the volatility in spot and derivatives markets, the transaction volume and on-chain activity remains extremely quiet.”
Bitcoin entity-adjusted total transfer volume. Source:Glassnode
Overall, how on-chain transfer volume responds to the recent price action in Bitcoin will provide better insight into where the market is headed, but as noted by Glassnode, “it remains to be seen whether on-chain volumes start to pick up in response to recent volatile price-action.”
Related:DeFi tokens book double-digit gains after Bitcoin rallies above $39,000
Bitcoin’s recovery above $40,000 also helped spark strong rallies in most altcoins.
Ether (ETH) gained of 11% to hit a daily high at $2,433, while Dogecoin (DOGE) posted a 7% gain and trades at $0.208.
Other notable gainers include a 64% gain for Strike (STRK), a 55% rally in Venus (XVS) and a 20% breakout in VeChain Thor (VTHO) and Ankr (ANKR).
The overall cryptocurrency market cap now stands at $1.46 trillion and Bitcoin’s dominance rate is 47.4%.
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.
Bitcoin, Alchemy of Money: Transforming Evil Into Greater Good
Bitcoin teaches us that evil can be overcome, not with resistance or punishment, but through our willingness to understand and integrate all sides of our nature.
From resource wars to human rights abuses and economic exploitation, greed and selfishness is now out of control. This has led to the breakdown of the current systems of accountability and a deepening crisis of liberal democracy which has exposed the weakness of the foundations of our global civil society.
In the formation of Western civilization, Christianity has played a powerful influence. Moral values articulated in the Bible helped shape modern court systems and their guiding precepts in defining judicial penalties.
Swiss psychologist Carl Gustav Jung saw inadequacies in the European religious framework of morality. His critique examined ways in which Christianity has promoted an image of God endowed with absolute goodness. The portrayal of a one-sided view of the Divine, acting exclusively as a force for good, is basic to the Judeo-Christian dualistic morality. It sees a part of human nature as evil in contrast to other parts regarded as good, tearing apart the interconnectedness of life.
Jung recognized the negative implications of this radical separation between the good and the evil. Deriving inspiration from the ancient philosophy aimed at metaphorically and literally turning lead to gold, Jung created a therapeutic practice aiming to restore the totality of the psyche. To him, alchemy represented “endeavors to fill in the gaps left open by the Christian tension of opposites.”
Now, over a half a century after the death of the giant whose contributions to psychology were far ahead of his time, our world has become far more complex. Globalization has brought people together for common goals, but it has also created friction among nations. As opposing ideologies and cultural values increase conflicts, Bitcoin, a breakthrough of computer science, now rekindles alchemical imagination.
@RD_btc
The Problem Of Evil
Bitcoin came into existence in the aftermath of the global financial crisis in 2008. The mysterious creator known by the pseudonym Satoshi Nakamoto shared the vision of peer-to-peer digital cash in a white paper. In the following year, January 3, 2009, an open-source protocol became operational as a decentralized digital currency.
The significance of this invention of technology goes beyond finance. Bitcoin, a software with a magical property, is like the philosopher’s stone. Arriving in cyberspace, it solved the weakness inherent in our current financial system that requires trust in central authority.
The key feature behind the current trust-based model is a moral maxim that is shaped by the dualistic view of opposition, establishing the antinomy of good and evil. The fiat monetary system is a closed system controlled by the few. Through levers of control, it maintains its integrity by carefully vetting participants for access and excluding “bad actors” who are engaged in behaviors that are considered negative.
Jung recognized a pitfall of moral duality that could lead to “the problem of evil.” He noted how our denial and condemnation of parts of ourselves become a “shadow” — the psychic forces that grow in the unconscious mind, and, over time, it gains its own autonomy and becomes extremely destructive.
Morality Turned Upside Down
When society judges and denies aspects of ourselves that are deemed unfavorable, they do not disappear. They are simply pushed out of our sight and kept hidden. Once having escaped from our consciousness, these forces become unchecked and can gain the upper hand.
Efforts through law enforcement to punish selfish actors can just make them more cunning, deceitful and hostile. Events such as HSBC money laundering and their involvement in arms trade along with the giant banking industry’s currency rigging have shown the use of traditional legal and regulatory tools to be completely ineffective.
In the end (or perhaps even from the outset), the fiat system was taken over and corrupted by power-hungry individuals. Now, central banks set rules for the entire global economy that can be changed at will — anytime and in whatever way they wish. With their monopolized printing press, elite economists, anointed by political leaders, create money out of thin air. This system, operating in secret without public accountability, acts as a moral authority dictating what is right and proper behavior. It creates hypocrisy and a double standard.
Under the banner of fighting against terrorism, banking and payment systems working on behalf of the U.S. Empire impose sanctions on countries that challenge their petrodollar hegemony. They suppress free speech via economic censorship, as was seen in the case of the financial blockade against WikiLeaks. On the pretext of stopping money laundering or protecting public safety, they shut down and freeze accounts of anyone who is suspected of conducting wrong or dangerous activities, acting themselves as arbiters of those terms.
@RD_btc
Proof Of Work
As a patronage network of private banks increasingly creates chaos and destruction in the world, Bitcoin now provides a creative approach for us to tackle the riddle of evil. Its core invention, a proof-of-work consensus algorithm, has begun to accelerate the demise of the fiat monetary system.
Satoshi, using strong cryptography, has created an unbreakable container that can unite the principles of good and evil. What facilitates Bitcoin’s alchemical transformation is the mining — a process that is involved in the creation of bitcoin and clearing of transactions.
In an open network where rules are applied to everyone equally, computers around the world (called miners) engage in a broadcast math competition. Rules of the game are fixed and made clear at the outset. They include the total quantity of bitcoin that can ever be created (math caps the monetary base at 21 million BTC), a predictable issuance rate and automatic adjustment of difficulty of the mining.
Solving math problems requires miners to spend energy, in this case electricity in the form of computational power. Every 10 minutes, problems are solved and whoever solves the problem first wins a fixed number of bitcoins. In order to earn bitcoin, everyone has to follow the rules of the game and do the work — use precious resources that are necessary to solve problems.
Mining difficulty is adjusted according to demand with a tight feedback loop every two weeks, keeping the mining always profitable. Regulated by the law of thermodynamics — principles concerning heat, temperature and their relation to energy — the dynamic market created through this global math contest provides security for the entire system.
@RD_btc
Honest Account Of Human Nature
The creation of digital gold requires special substances. Satoshi created the magic formula by mixing game theory (the study of mathematical models of strategic interaction among decision-makers) and economic incentive structure (careful balance of risk and reward).
Jung emphasized how the psychic processes of alchemy require us to confront our own shadow and make a healthy relationship with it. The creator of Bitcoin faced and integrated the dark side of humanity with the knowledge of evolutionary psychology — a biologically informed approach to study human behavior.
The essential idea was articulated by evolutionary biologist Richard Dawkins. Dawkins, the author of the influential book, “The Selfish Gene,” renewed the theory of evolution by putting genes rather than individuals at the center. With the term “the selfish gene,” he explained how “a gene that didn’t look after its own interests would not survive” and posited selfishness as a foundation of developing altruism. This theory offered an explanation of the paradox of human nature; humans can be selfish and nasty, yet at the same time we have a capacity for empathy and can act kindly toward others.
With an honest account of ourselves as both corruptible and perfectible, Satoshi created Bitcoin’s unprecedented security model. Bitcoin’s computer scripting language does not say, “You shall not cheat, steal and attack a network.” Satoshi expects miners to act selfishly. If some miners are kind to others and hesitate to compete, he knows this kindness will be exploited. Bitcoin developers share a mindset — that Bitcoin lives in an adversarial environment — and so humanity’s fallible nature is factored into the design of the system.
The Genius Of Economic Incentive
Unlike the fiat system that acts punitively toward those acting in their self-interest (except for those who run the system), the creator of Bitcoin accepts humanity’s tendency to take advantage of the good will of others and found a way to constructively work with it. Through the method of decentralization, aligning everyone’s incentives, Satoshi uses rewards to encourage all players to act honestly in an open and transparent network.
This creative ensuring of the rule of consensus, without the use of force, introduced a new code of ethics that radically departs from the old dualistic morality. The significance of this shift into a more compassionate approach might be compared to the breakthrough of Jesus Christ’s moral teaching recorded in the New Testament.
In the Sermon on the Mount, Jesus taught his followers how to pray. The Lord’s Prayer provided his disciples with a path to repentance. The path includes petitions made to God for forgiveness of our sinful nature and those requests were granted. Similarly, Bitcoin is an inclusive network with its door kept open to whoever asks and seeks to correct their deeds through following the rules of consensus.
The Lord’s Prayer reads, “Lead us not temptation, but deliver us from evil.” Bitcoin’s innovative incentive structure responds to the wishes of bitcoiners. Robert Wolinsky, senior manager of blockchain research at Genesis Project, explains the genius of Bitcoin’s economic incentive structure noting how “Satoshi introduces a cost equation to cheating/collusion via the proof-of-work protocol,” making the cost of attacking the network clear to parties and having them pay for it upfront. Furthermore, by making the rewards for playing by the rules higher than the value of attacking the network, it can proactively protect the system.
Through incentivizing greed, Satoshi does not test miners beyond their capacity to endure, and, at the same time, by rewarding honest behavior, he ensures that even the lost souls among us who are devoid of conscience will not be led astray.
Satoshi’s Grace
The New Testament was said to have brought a “covenant of grace.” With this, humanity is allowed to repent their transgressions, not by perfect compliance with a God’s will but by faith in his forgiveness. In this process, no priests, prophets, even Jesus himself can insert their authority and intervene in one’s relationship to the Divine.
Satoshi, with the invention of the consensus algorithm, established a new contract in which individuals can now directly connect to the source. Through simply trusting math, now each of us can claim virtues within ourselves and align our actions with truth and honesty. This is Satoshi’s grace. The Bitcoin protocol now helps us rescue ourselves from the separation within ourselves, from falling under the sway of the autocratic fiat regime.
Now, the great work has begun for the transformation of evil into a greater good. Satoshi’s love creates a spark of magic in the cryptographically ensured alchemical vessel. Man’s burning zeal for scarce money ignites the fire for the creation of the heart of gold. With the heat generated through the brutal mining competition, the flame glows ever more immensely for the redemption of our own selfishness.
By channeling energies that have been funneled into the military-industrial complex and surveillance capitalism, Bitcoin transmutes greed and aggression into a formidable defense for peace. The network, backed by the great hashing power, preserves moral values created by sovereign individuals out of their own freedom.
Bitcoin, an alchemical form of money, has begun to liberate people from the tyranny of central banks. Hyperbitcoinization could end misery and suffering and help move humanity toward our own salvation.
Acknowledgement: Special thanks goes to La Fleur Productions for her editorial help.
This is a guest post by Nozomi Hayase. Opinions expressed are entirely their own and do not necessarily reflect those of BTC, Inc. or Bitcoin Magazine.
Articles discussing the possibility of banning cryptocurrency ignore the reality that cryptoassets have become part of the mainstream financial ecosystem; even proposing a ban would directly harm consumers, companies, and the United States economy.
Getty
getty
Cryptocurrencies have long been viewed, by some, as convenient things to blame for cyberattacks, ransomware, and other digital criminal activity. The issue at hand, however, is that even though ransomware payments made in bitcoin or other crypto certainly make for splashy headlines, focusing only on these ignores two facts. Firstly, cybercrime and cybersecurity related issues existed long before bitcoin and other cryptoassets burst into the financial landscape. Criminals are adept at finding tools to enable criminal activity; there is no indication that banning cryptoassets would reduce cyberthreats.
Secondly, many of those same splashy crypto headlines ignore the fact that there have also been several high profile recoveries of funds by law enforcement agencies. The JBS bitcoin ransom recovery by the FBI was undoubtedly the highest profile instance of this kind, but law enforcement agencies across the world have successfully been cracking down on criminal enterprises seeking to leverage blockchain and cryptoassets. Some purists might decry the increased regulatory and law enforcement action, but reducing the criminal element in any sector should be viewed in a positive light.
Building on this point, some of the other common arguments against allowing continued cryptoasset development and proliferation center around the 1) potential for private currencies to undermine nationally issued fiat currencies, and 2) the risk from a national security perspective for developed economies, notably the reserve status of the U.S. dollar. Let’s break down some of those concerns, and see why proposing (or enacting) a ban of crypto is definitely not the solution.
Threat to financial stability. Recently, and by no coincidence right alongside the rise of stablecoin-based transactions, there have been discussions that cryptoassets might eventually pose a systemic threat to the global financial system. Peel back the layers, however, and the opposite is rapidly becoming apparent. Major enterprises – including those lying at the heart of global payment and remittance system – are rapidly embracing crypto, and these organizations include firms headquartered in the United States and abroad.
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Additionally, virtually every major financial institution is either allowing at least some customers to access cryptoasset products and services, or are actually directly engaging in crypto transactions, custodial services, or other crypto adjacent products. In other words, individual customers and institutional players are both increasingly getting involved and engaging with crypto transactions. Notably, involving these incumbent players should help assuage doubts about financial stability; these organizations are already equipped to deal with market risk, compliance, and market uncertainty.
Finally, this argument presupposes that the market cannot possibly absorb and integrate a new financial instrument, product, or service. The fallacy of this argument, when looking back at the slew of new products and services that have been introduced over the last several decades, should be obvious.
Undermining national security. The United States enjoys perhaps the single largest economic advantage in the world via the status of the dollar as the global reserve currency. That said, there is no inalienable right that the dollar should always serve in this role; numerous other nations have filled this role in previous eras. Cryptoassets and other forms of private money may indeed serve as a potential competitor for fiat based currencies, but the rapid rise of central bank digital currencies (CBDCs) shows just how proactively governments the world over are responding to this development.
While the United States currently may seem to be lagging behind other countries in the development and implementation of a CBDC, and it certainly is worth taking the time to get it right, that is absolutely not a reason to be discussing potential crypto bans. Competition, in all its forms, brings the best and most innovative results to the forefront – why should currencies be treated differently?
Many improvements, admittedly, have been made to the global payments system in the last several decades, but the fact remains that digital and cryptographically secured payments are the future of 21st century money. The United States faces economic and strategic competition across the board; having a robust and technologically advanced currency should absolutely be a part of the economic portfolio moving forward.
Cryptoassets have been, and continue to be for some, a convenient place to lay blame for cybersecurity risk, economic volatility, and the dangers of private actors wading into areas traditionally reserved for government. That said, the success and dynamic growth of the space the world over should provide evidence that this sector is opening up opportunities for both the private and public sector. Rather than focusing on the potential risks, of which there certainly are some, individuals in the marketplace have embraced the opportunity of cryptoassets for payments and other economic sectors. Policymakers would be well informed to take a similar point of view.
A high-profile crypto trader and analyst is optimistic about the futures of two altcoins as Bitcoin (BTC) and the crypto market gain momentum.
In a series of tweets, the pseudonymous trader, known in the industry as Kaleo, says that he is building positions in Dapper Labs’ non-fungible token (NFT) project, Flow.
Kaleo says Flow is on the edge of sharply outperforming Bitcoin, as NFT and gaming tokens such as Axie Infinity (AXS) are gaining major attention in the market.
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“I punted a long on FLOW. I’ve missed out on the majority of the NFT pumps led by AXS and decided I finally needed some exposure.
The BTC chart is breaking out above higher time frame resistance dating back to the spring rally, where it was one of the leaders in the NFT race.”
Source: Kaleo
On the USD base pair, Kaleo was initially hesitant to add to his position as FLOW battled with resistance on the lower timeframe at $20.96. Now Kaleo says that he’s adding to his FLOW position, as the asset dipped slightly toward $19.95, allowing for a better entry.
“Added more FLOW on the dip.”
Source: Kaleo
The other asset Kaleo is trading as the market recovers is blockchain network Terra Luna (LUNA).
Against USD, Kaleo charts out LUNA forming an ascending wedge, preparing to breakout above $8.
Source: Kaleo
Luna is currently trading at $9.42, up nearly two dollars since Kaleo started tweeting about the asset.
As Bitcoin trades at around $38,000, Kaleo reminds his 338,000 followers that in February, when Bitcoin traded at around $30,000, the top cryptocurrency took just one week to sail above $47,000.
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Disclaimer: Opinions expressed at The Daily Hodl are not investment advice. Investors should do their due diligence before making any high-risk investments in Bitcoin, cryptocurrency or digital assets. Please be advised that your transfers and trades are at your own risk, and any loses you may incur are your responsibility. The Daily Hodl does not recommend the buying or selling of any cryptocurrencies or digital assets, nor is The Daily Hodl an investment advisor. Please note that The Daily Hodl participates in affiliate marketing.
The International Monetary Fund is warning that some of the consequences of a country adopting Bitcoin as a national currency “could be dire.”
According to IMF marketing department financial counsellor and director Tobias Adrian and legal department general counsel and director Rhoda Weeks-Brown, a cryptocurrency like Bitcoin (BTC) may catch on in countries without stable inflation and exchange rates, and provide unbanked people with the means to make payments. However, the cost to an economy could be significant.
The two IMF officials alleged that countries adopting cryptocurrencies as national currencies or “granting cryptoassets legal tender status” risked domestic prices becoming highly unstable, and assets being used contrary to anti-money laundering and combating the financing of terrorism measures, in addition to having issues surrounding macroeconomic stability and the environment.
Related:Bitcoin at Risk as IMF Warns of Worst Downturn in 90 years
“If goods and services were priced in both a real currency and a cryptoasset, households and businesses would spend significant time and resources choosing which money to hold as opposed to engaging in productive activities,” said Adrian and Weeks-Brown. “Government revenues would be exposed to exchange rate risk if taxes were quoted in advance in a cryptoasset while expenditures remained mostly in the local currency, or vice versa.”
They also claimed that monetary policy in general “would lose bite,” implying widespread crypto adoption lessens the credibility of any country adopting an asset like BTC or another token, and pointed to the “massive fluctuations in cryptoasset prices.” The price of Bitcoin has already moved between roughly $65,000 and $30,000 this year, and reached more than $40,000 today before dipping to the $37,000s.
Though the IMF blog did not specifically call out El Salvador, which is set to start accepting Bitcoin as legal tender starting in September, Adrian and Weeks-Brown said making any cryptocurrency a national currency “is an inadvisable shortcut” to more inclusive financial services. The pair included claims of environmental risks for mining cryptocurrencies, though El Salvador President Nayib Bukele has said he plans to take advantage of the country’s abundant geothermal energy to generate Bitcoin blocks.
Related:El Salvador’s Bitcoin adoption may jeopardize IMF negotiations: JPMorgan
Expressing seemingly negative views on countries adopting crypto is nothing new for the IMF. Spokespeople have previously said smaller nations like the Marshall Islands recognizing a digital currency as legal tender “raise risks to macroeconomic and financial stability as well as financial integrity.” In that case, the IMF said the islands’ local economy had been strained by the economic fallout of the pandemic and likely wouldn’t be fixed with the introduction of a digital currency.
While several factors are in the play, the driving force is a “short squeeze of epic proportions,” say the experts.
The price of Bitcoin today surged past $40,000 for the first time since June. Why is this happening? Could it be Elon Musk and the anticipation of Tesla earnings, or whispers ofAmazon warming up to Bitcoin? That may all be playingsomerole, but the real driving factor is something a tad more technical, according to the experts.
Bitcoin, the biggest cryptocurrency by market cap, experienced a “short squeeze,” say analysts and traders. This is when an asset shoots up in value due to a large number of traders “squeezing out” short sellers—those betting that the price of an asset will go down.
The practice, with respect to cryptocurrency, is all part of the multi-trillion-dollar crypto derivatives market, which is larger than the spot market.
In the sport market, traders buy and sell actual cryptocurrencies, such as Bitcoin or Ethereum. In the derivatives market, people trade contracts, rather than the crypto itself. More advanced traders use “futures,” which are products that allow traders to bet on the price of crypto like Bitcoin going up or down (shorting or longing.) It involves borrowing money from exchanges—called “leverage”—to place bigger bets (until recently as large as 125X) and generate even bigger profits.
When those shorting an asset like Bitcoin start to lose out (in other words, the price of the cryptocurrency rises) they are forced to capitulate and start buying at higher prices to pay back the initial loan they took out. This causes the price to go up even further—and quickly.
There have been a lot of crypto short positions, using leverage, as of late. In fact, according toBybt.com data, today nearly $1 billion in shorts were liquidated following the “epic” short squeeze over the weekend.
Ex-banker and analyst Alex Kruger toldDecrypt: “That was a simple short squeeze of epic proportions.” But while this squeeze was notably larger and more impactful than previous maneuvers of this sort, “Bitcoin experiences such squeezes,” said Kruger.
“The market had gotten obscenely short, and traders continued to pile on shorts even as [the] price reversed higher.” He added that leveraged shorts are “vulnerable to squeezes”—especially when using stablecoins—blockchain-based digital assets that are designed to hold a steady value—to make the bets.
Jeremy Ong, who works in business operations at the crypto research firm, Delphi Digital, said that the squeeze was possibly still ongoing, too (further pushing up Bitcoin’s price.)
He added that “selling pressure seems to have cooled down,” referring to the huge sell-off Bitcoin experienced in May. “Investors that wanted to sell because of those bearish catalysts should already be done,” he said.
Bitcoin was on a seemingly never-ending run in the first quarter of this year. It touched highs of $60,000 in March, in part driven by electric car company Teslabuying $1.5 billion-worthof it and other big firms continuing to invest in crypto.
And then came the crash. In May, the entire crypto market suffered the worst pullback in its history: $500billionwaswiped offovernight. This was due to a combination of factors: China reiterating Bitcoin regulation laws, Elon Musk, one of the world’s richest men, saying his electric car company would no longer accept the cryptocurrency, and the ensuing market liquidations.
The crypto derivatives market largely drives the price action on the spot market. When things go awry and traders’ bets get liquidated, the market can crumble.Liquiations of $1 billionin futures contracts back in March, for example, caused a tumble in prices. Back then, though, traders had leveraged huge amounts of cash to bet on the price of Bitcoin going up. This time, the bets were on it going down.
Now Bitcoin—and the wider market—isbouncing back. The biggest crypto is up 11% in the past 24 hours and 25.6% in the past week.
