Protocol and community development initiatives have become the latest trend in the cryptocurrency market after a number of projects have launched multi-million dollar funds aimed at enticing builders and investors to make the cross-chain migration into the layer-2 ecosystem.
The latest project to capitalize on this trend is Harmony (ONE), a blockchain protocol that boasts a 2-second transaction finality and offers cross-chain bridges to a handful of layer-one protocols, including Bitcoin (BTC), Ethereum (ETH), Polkadot (DOT) and the Binance Smart Chain (BSC).
Data from Cointelegraph Markets Pro and TradingView shows that since hitting a low of $0.095 on Aug. 31, ONE price rallied 120% to a daily high at $0.21 on Sept. 9 as its 24-hour trading volume spiked to $717 million.
ONE/USDT 4-hour chart. Source: TradingView
The surge in ONE price came after the project announced a new $300 million ecosystem fund aimed at attracting 10,000 developers and project founders to build on the protocol.
Today, we are announcing our $300 million ecosystem fund to accelerate 10,000 builders.
The @harmonyprotocol ecosystem has been growing exponentially and we aim to fund 10,000 more crypto founders, builders and creatives.
Let’s build the future together: https://t.co/6Yb9DoAa65
— Harmony (@harmonyprotocol) September 9, 2021
Aside from the development fund, Harmony price also benefited from the new partnerships and cross-chain integrations established over the past few months. The most recent development came with the Sept. 8 announcement of a partnership with Anyswap that will bring a Bitcoin bridge to Harmony.
Related:New fund aims to put hundreds of millions toward Algorand DeFi growth
Funding incentives ignite price rallies
Community development funds launched by protocols over the past month is the new tactic being used to attract liquidity.
Avalanche was one of the first to do so when it announced its $180 million “Avalanche Rush” DeFi incentive program, which was followed by a 200% rally in the price of AVAX.
Another example is Fantom, which has seen its price surge by 300% following the announcement of its 370 FTM incentive program.
Other protocols that have launched similar initiatives recently include Terra, whose “Project Dawn” launch allocates $150 million to help improve the Terra ecosystem and Algorand, which launched a $300 million Viridis DeFi fund aimed at maximizing the growth of the DeFi ecosystem on Algorand.
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.
It is fashionable in bitcoin circles these days to join the DCA army: to dollar-cost average your savings into bitcoin. If you put away a little bit at a time, even trifling amounts like $1, $5, or $10 a day, you can grow your stash into very impressive fortunes. It makes for a smoother journey, and it overcomes the psychological barrier of buying at (what until two minutes ago seemed like) very high prices.
DCAing is an investment strategy that bitcoiners inherited from the world of traditional finance – and it’s completely wrong.
First, let me give some caveats: I adore Hass McCook; his articles, particularly those on energy use, are amazing. I don’t dispute his conclusion that a DCA army would be good for the bitcoin network’s price stability and for moving sats into strong hands. Most people don’t have the guts to stomach the risk of buying a top with everything they’ve got. And for even more of us the psychological commitment device of repeating a small thing every single day turns terrifying saving decisions into routine habits.
But as an investment thesis on top of a structurally upward-moving asset, it makes little sense. Most people have heard the investment quips of people like Warren Buffet or Ken Fisher saying that “time in the market beats timing the market;” DCAing a current stash of dollar savings into bitcoin over a certain time period intentionally delays your time in the market in exchange for avoiding the prospect of horrifically mistiming the market.
Let me then unleash my contrarian nature for a minute and say the following: if you have a stack of money about to enter an appreciating asset, DCAing is psychologically soothing but rationally foolish.
The Virtues Of Dollar-Cost Averaging
As with many things, we often give practical advice to beginners that the pros don’t follow. Sometimes we even give advice that isn’t literally true, but gets the job done and gets the beginner over the initial hump. We teach people unfamiliar with guns to always treat them as loaded and off safety, even when we know they’re neither; we instruct kids to follow through their baseball swings or their golf strokes, even though what they do after they’ve hit the ball cannot have any impact on the ball’s trajectory.
A similar thing is at play with moving an increasing amount of your assets into bitcoin: it makes a lot of sense and harks back to well-studied diversification strategies in legacy finance.
The virtue of dollar-cost averaging into an investment over time is twofold. First, DCAing allows for a smoother journey: you buy when it’s cheap, and you buy when it’s expensive, which means that over time you get a decent cost basis – without needing to know when that is. This calms people’s nerves, gets them comfortable with price swings, and disciplines their feelings so that they don’t deviate from a strategy that over time works reasonably well.
Second, you avoid the psychologically painful experience of buying with everything you have right before a 30-50% reversal. Those hurt, and bitcoin’s past has a few of them. Mistiming lump-sum purchases right before such reversals feels like throwing a lot of money right down the drain. You instantly lost a big part of your savings. Making matters worse, had you only waited a little while, you could have bought coins at a steep discount. Ouch.
But those are unrealistic fears. The entire reason we’re considering a DCA is that we can’t time the market. We don’t know when those terrifying reversals are coming, and so calculating what would have been had we been omniscient is an exercise into the unreal. Such is not an option available to us mortals.
Some Numbers To Illustrate The Problem
Let’s use some legacy-finance returns to show the problem. Jeremy Schneider at Personal Finance Club has a calculator that runs on S&P 500 returns reaching back to the late 1800s. This American stock index works as a comparison with bitcoin because, like bitcoin, it’s a volatile price journey on a structurally upward-moving trend.
Almost no matter what numbers you put into these calculators, you can’t get the DCA strategy to outperform the lump-sum purchase more than about 35-40% of the time. DCA only wins when your lump-sum purchase happens right before big market crashes. In every other scenario, and under long enough time investment horizons, the lump-sum purchase wins.
Moneychimp, who offers a similar calculator, writes
“Dollar cost averaging will win if your start date falls right before a dramatic crash (like October 1987) or at the start of an overall 12-month slump (like most of 2000). But unless you can predict these downturns ahead of time, you have no scientific reason to believe that dollar-cost averaging will give you an advantage.”
Let’s perform the same exercise for bitcoin. Plugging in Hass McCook’s suggested $10 daily purchases for the last five years on DCAbtc.com we get $18,260 invested for a total portfolio value as of late August of almost $260,000 — a little over 1300% return:
Compared to a 56% gain on a similar S&P 500 DCA plan, that’s pretty good.
But five years ago, bitcoin traded at $568.40. A lump-sum purchase of $18,260 would have afforded you over 32 full coins, for a total value today somewhere north of $1,500,000. That’s 8,400% return – quite a lot above the 1300% profit that the DCA plan returned. The lump-sum purchase wins, because it didn’t happen right before a major crash but before a few major bull runs.
Had you had the extremely poor timing of buying bitcoin in early December 2017, you’d get a purchasing price of somewhere between $9,000 and $16,000 for total returns until today, now between a 202% and 437% return. Not terrible, but only a little bit less than what a DCA plan starting then would have yielded you — 452%.
Asymmetry Of The Upside And The Downside
If you have the foresight (or hubris) to think you can time the market and determine when bitcoin is selling for cheap, you don’t need any of these strategies; you just need to play the formula you think you’ve uncovered. Of course, chances are you’re wrong because almost nobody manages to time any market — at least not often enough and consistently enough that it’s distinguishable from luck.
The rationale for DCAing into any asset is that we can’t foresee the future: we do not know how to time the market. There are going to be shocks to the price of any asset, up and down. But if our thesis of bitcoin’s superiority is right, those shocks are going to be up more often than down. If you wait and delay purchases — which is the essence of DCAing — you’re more likely to expose yourself to missing out on upward shocks than protecting yourself from downward shocks.
If you think the dollar is a melting ice cube and you think your target asset is on a volatile journey with an upward trend, you will suffer more from the opportunity cost of waiting to enter than from the real loss of buying at a (local) top. They’re both losses: one just feels more real than the other. Dollar-cost averaging is a hedge against entry into fairly symmetrical trades. As an entry into an upward asymmetrical trade, it’s a losing proposition.
If you deviate from the DCA rule, thinking “I’m going to wait for a pull-back and opportunistically buy when it’s cheap” you might be waiting forever. More importantly, you’ve already returned to the mindset of trying to time the market — but without the rules, the safety mechanisms, and the analytical tools to actually do it. You’re like a central banker, refusing to honor the rules you know work better over time, setting them aside to trust your gut feeling, to make policy on a whim, on extreme fears, or the present bias and action bias which most people succumb to.
Even if you’re not sold on my contrarian take so far, keep in mind that most people’s finances are structured for DCAing anyway: you earn an income every month, and insofar as your conviction remains or strengthens, you’ll likely stack more with whatever future surplus you manage to eke out from spending less than you earn. To needlessly DCA even more, out of a dollar stash you’re already holding, is inconsistent with what you say you believe.
Investing on top of a structurally upward-moving trajectory, a positive-sum game, tilts the stakes in favor of getting in earlier (once again, “time in the market…”). Against that, DCAing operates like an insurance: you protect against the worst negative outcomes, but you pay for it dearly by giving up most of the grand upside you say is coming.
If you think yourself in control of your investment decisions and capable of withstanding the psychological pain of outlier events (buying at, say, $64,000 right before this year’s 50% drawdown), the optimal strategy is to buy as much as you can, as early as you can. Ironically, the more bullish you are on bitcoin’s (long-term) prospects, the less favorably you ought to look at DCAing.
Smooth your purchases over time if that makes you sleep better at night, but for superior long-term performance you’re probably better off just plunging headfirst into the deep end.
This is a guest post by Joakim Book. Opinions expressed are entirely their own and do not necessarily reflect those of BTC Inc or Bitcoin Magazine.
An Ohio man will be getting 20 years in prison for carrying out a cryptocurrency scam. Michael Ackerman has pleaded guilty to the crime and might be spending a long time in prison. According to the US Justice Department, the man pleaded guilty to the multi-million dollar cryptocurrency scam last week.
A Cryptocurrency Scam Worth Of Millions
Michael Ackerman planned and executed a cryptocurrency scam in 2017. This scheme promised to pay investors 15% on their investments every month. Even though the benefits were too dubious and impossible, many investors rushed in to utilize the opportunity.
The scam was called the “Q3 Trading Club,” a fund that used investor’s money to make the supposed profits to be shared as returns.
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On September 8, 2021, a US attorney, Audrey Strauss from the New York Southern District, announced that Ackerman had pleaded guilty to the charges. According to Strauss, the man agreed to have caused the victims to lose above $30 million in cryptocurrency assets.
Related Reading | New To Bitcoin? Learn To Trade Crypto With The NewsBTC Trading Course
In the announcement, the attorney stressed that Arkerman agreed to have used his fake crypto scheme to steal millions from investors with the promise of 15% monthly returns.
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In addition, Strauss also disclosed that Michael Ackerman used fake documents to deceive the investors. His balances showed more than $315 million in the fund. But the reality was just a little above $5 million from the DoJ’s discoveries.
The attorney also revealed that Ackerman stole investors’ money amounting to $9 million just to continue his lavish lifestyle. The man spent a lot of money on vehicles, real estate, personal security, traveling, and jewelry.
Michael Ackerman Agrees To Pay
The announcement also stated that Michael Ackerman has pleaded guilty to wire fraud. He agreed to pay back $30 million and forfeit at least $36 million in real estate, jewelry, cash which he acquired fraudulently. As for now, the sentencing will take place on January 5th, 2022.
The first charges came from the SEC in 2020. The crime was the violation of securities laws by Michael Ackerman.
Related Reading | Bitfinex To Roll Out Security Token Offerings (STOs) Platform In Kazakhstan
The reports then showed that he used a private group that he created on Facebook to target physicians. The group was called “Physicians Dad’s Group,” and the SEC discovered his fraudulent intent.
Michael Ackerman has never worked as an institutional broker in the New York Stock Exchange. Instead, he was operating as one of three scammers, including James, a Wells Fargo financial advisor, and another member, a surgeon called Quan Tran. In 2020 April, the victims of the incident sued Fargo for not investigating its employee.
The Cardano network has officially executed its highly touted Alonzo hard fork.
The upgrade introduces smart contract capabilities and paves the way for developers to launch a host of new projects and applications on the network, such as decentralized finance (DeFi) platforms, non-fungible tokens (NFTs) and stablecoins.
Source: InputOutput
Cardano creator Charles Hoskinson says he believes the platform’s long path to the smart contract era will be beneficial for the entire crypto industry.
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“We worked for a very long time. Some of the members of this team have been working for over four years. We did our work. [We did] our homework. We did hundreds of presentations, dozens of papers.
So much code was written and a lot of very careful thought went into building a very novel model that’s ubiquitously beneficial, if anything, as an experiment for the industry [that] we feel is the best industrial model.”
With smart contract functinality now live on Cardano’s mainnet, Hoskinson is looking ahead to what’s next for the ecosystem, including the debut of the Plutus application backend, which offers a suite of components that will allow both technical and non-technical users to build on the network.
“So that’s the day, and you know what happens? There has to be a morning after, September 13th, Monday. We wake up. It’s business as usual. Lots of things will happen. [The] network will probably be under a lot more load because people play around with things and test things and that’s fine.
And a few weeks later, the latest and greatest version of the Plutus application backend will be released and we’ll have the [Cardano 2021] summit. And there will be a huge spotlight on the ecosystem as a whole. That will be a great event.”
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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.
Bitcoin (BTC) is witnessing a tough tussle between the bulls and the bears near the 200-day simple moving average, which is considered as an important level by institutional investors attempting to decide whether the asset is bullish or bearish.
Along with this, crypto investors are also watching the formation of a golden cross in Bitcoin. If this bullish setup completes, it will signal a trend in favor of the bulls. For the time being, investors continue to focus on select altcoins that have continued their northward journey.
Crypto market data daily view. Source:Coin360
On the fundamental front, Bitcoin reached another milestone as miners produced the 700,000th block on Sep. 11. Bitcoin was trading near $8,000 when the 600,000th block was reached on Oct. 18, 2019.
Reaching this milestone led some Twitter users to quote Hal Finney, one of Bitcoin’s earliest pioneers who had said:
“Every day that goes by and Bitcoin hasn’t collapsed due to legal or technical problems, that brings new information to the market. It increases the chance of Bitcoin’s eventual success and justifies a higher price.”
Let’s study the charts of the top-5 cryptocurrencies that may attract trader’s attention in the short term.
BTC/USDT
Bitcoin closed below the 200-day SMA ($45,894) on Sep. 10 but bears have not been able to capitalize on this move. The bulls are currently attempting to push the price back above the 200-day SMA.
BTC/USDT daily chart. Source: TradingView
The moving averages are close to completing a golden cross, indicating that the advantage is likely to tilt in favor of the bulls. If buyers push the price above $47,399.97, the BTC/USDT pair will attempt to rise to the overhead zone of $50,500 to $52,920.
The bears are likely to defend the overhead zone aggressively but if bulls do not give up much ground, the likelihood of a break above $52,920 increases. If that happens, the pair could rally to $60,000.
On the other hand, if the price turns down from the current level, it will suggest that bears are aggressively defending the 200-day SMA. The pair could then retest the critical support at $42,451.67. A break below this level could tilt the advantage in favor of bears.
BTC/USDT 4-hour chart. Source: TradingView
The 4-hour chart shows that the price turned down from $47,550 on two occasions. Hence, this becomes an important level to watch out for in the short term. A break and close above this resistance may open the doors for a possible move to $50,500.
However, the moving averages are on the verge of a bearish crossover, indicating that sellers are attempting to make a comeback. A break and close below $44,000 could signal a minor advantage to bears. The pair could then drop to the critical level at $42,451.67.
ALGO/USDT
The long tail on Sep. 7 shows that bulls aggressively bought the dip to the 50-day SMA ($1.10). Strong buying on Sep. 8 propelled Algorand (ALGO) above the stiff overhead resistance at $1.84.
ALGO/USDT daily chart. Source: TradingView
The bears tried to trap the bulls by sinking the price below the breakout level at $1.84 on Sep. 10 but the buyers had other plans. The ALGO/USDT pair has rebounded off the support with strength today and bulls are currently attempting to thrust the price above $2.49.
If they succeed, the pair could resume the uptrend with the first target on the upside at $3 and then $3.32. On the contrary, if the price once again turns down from $2.49, the pair could drop to $1.84 and stay range-bound between these two levels for the next few days.
A break and close below $1.84 will suggest that the current breakout was a bull trap. The pair could then slide to $1.60.
ALGO/USDT 4-hour chart. Source: TradingView
The 4-hour chart shows that bears are defending the overhead resistance at $2.49. If sellers pull the price below $2.30, the pair could again slide to the breakout level at $1.84. A bounce off this support could suggest a range-bound action for some time.
If bulls do not give up much ground from the current levels, it will increase the possibility of a break above $2.49. If buyers sustain the breakout, it could signal the resumption of the uptrend.
ATOM/USDT
Cosmos (ATOM) bounced off the breakout level at $17.56 on Sep. 7, suggesting that bulls are aggressively defending this support. This was the second instance that bulls successfully held this level, the previous one was on Aug. 26 and 27.
ATOM/USDT daily chart. Source: TradingView
The long tail on Sep. 8 showed that sentiment was turning positive and traders were buying on dips. The moving averages have completed a golden cross, indicating that bulls are back in the driver’s seat.
Strong buying today has pushed the price above the overhead resistance at $32.32. If bulls sustain the breakout, the ATOM/USDT pair may rally to $39.43.
The bears are likely to have other plans. They will try to pull the price back below $32.32 and trap the aggressive bulls. If they succeed, the pair may drop to $26. A break below this level will suggest that the bullish momentum has weakened.
ATOM/USDT 4-hour chart. Source: TradingView
The 4-hour chart shows that bears sold the breakout above $32.32 but they could not sustain the pair below $32. This suggests that bulls continue to buy on every minor dip. If bulls sustain the price above $32.32, the pair could rally to $38.49.
Conversely, if bears again pull the price below $32.32, the pair could drop to $30.98. If the price rebounds off this level, the bulls will attempt to resume the uptrend but if the support cracks, the decline could extend to the critical support at $26.
XTZ/USDT
Tezos (XTZ) completed a successful retest of the breakout level at $4.47 on Sept. 7 and Sept. 8. Although bears pulled the price below the 200-day SMA ($4.19), they could not sustain the lower levels. This suggests accumulation on dips.
XTZ/USDT daily chart. Source: TradingView
The XTZ/USDT pair picked up momentum on Sep. 9 and bulls pushed the price above the overhead resistance at $6.14 on Sep. 10. The long wick on the candlestick of the past two days indicates strong selling near $7.
Hence, this becomes an important resistance for the bulls to cross. If they manage to do that, the pair could retest the all-time high at $8.42. A breakout and close above this level will suggest the start of a new uptrend.
Alternatively, if the price once again turns down from the overhead resistance, the pair could drop to $5. Such a move will suggest aggressive profit-booking at higher levels.
XTZ/USDT 4-hour chart. Source: TradingView
The 4-hour chart shows the pair is currently consolidating between $5.88 and $6.80. If bulls drive and sustain the price above the overhead resistance zone at $6.80 to $6.95, the pair may rally to $7.72.
If the price turns down from $6.80, the pair may extend its range-bound action for some more time. A break and close below $5.88 will be the first sign that bulls are losing their grip. The pair could then drop to the 50-SMA.
Related:El Salvador buys the dip as Bitcoin Law goes live, 101 Bored Ape NFTs sold for $24M, Ukraine passes crypto legislation: Hodler’s Digest, Sept. 5-11
EGLD/USD
Elrond (EGLD) rebounded off the 200-day SMA ($131) on Sep. 7 and Sep. 8, suggesting strong demand at lower levels. The moving averages completed a golden cross on Sep. 9 indicating that bulls are back in command.
EGLD/USDT daily chart. Source: TradingView
Sustained buying propelled the EGLD/USDT pair to a new all-time high on Sep. 11 where bears tried to stall the up-move. However, the bulls were in no mood to let go of their advantage and have pushed the price to a new all-time high today.
If bulls sustain the price above $245.80, the pair could start the next leg of the uptrend. The bears may pose a stiff challenge at the psychological level at $300, but if bulls can overcome this resistance, the rally may extend to $357.80.
The bears will have to pull and sustain the price below the breakout level at $245.80 to signal a possible change in trend.
EGLD/USDT 4-hour chart. Source: TradingView
The bulls are currently attempting to push and sustain the price above the resistance line of the ascending channel pattern. If they manage to do that, the bullish momentum could pick up further and the pair may enter a blow-off phase.
On the other hand, if the price turns down from the current level, the pair may drop to the support line of the channel. A strong rebound off it will suggest that the sentiment remains positive and traders are buying on dips.
A break and close below the channel will be the first sign that the bullish momentum could be weakening.
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk, you should conduct your own research when making a decision.
A new study reveals that almost 50% of one South American country’s residents say they would welcome the adoption of Bitcoin as their official currency.
A survey cited by São Paulo-based financial education website Valor Investe polled 2,700 respondents from Brazil, Argentina, Chile, Colombia, Costa Rica, El Salvador, Venezuela and Mexico.
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The study shows that nearly half of Brazilians want their country to join El Salvador by recognizing Bitcoin as legal tender.
“Brazilians were the biggest advocates of crypto-recognition in the region, with 56% supporting El Salvador’s approach and 48% saying they want Brazil to adopt it as well… Another 30% neither agree nor disagree and 21% are against the idea (12% disagree and 9% strongly disagree).”
According to the poll, there are three primary factors motivating Brazilians to invest in cryptocurrencies.
“About the main reasons for investing in cryptocurrencies, Brazilians mention: to diversify investments (55%), protect against inflation and financial instability (39%) and follow the technology trend (37%).”
The survey also mentions that only 12% of the residents polled say that they are not looking to invest in cryptocurrencies. Of those who do not consider entering the crypto markets, 42% cite security concerns, 37% bring up volatility and 33% say they lack the money to invest.
Lastly, the study shows that Bitcoin is the most well-known crypto asset in the country (92%), followed by Ethereum (31%) and Litecoin (30%).
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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 European Securities and Markets Authority (ESMA) is mentioning cryptocurrencies and digital assets in their 110-page report on market trends.
While ESMA concedes that crypto is itself an innovation, they say it has “unintended consequences” of large environmental impact that has yet to be addressed by regulation.
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“Innovation can support sustainability by addressing ESG (environmental, social and corporate governance) information gaps through green financialtechnology (FinTech) solutions, but the environmental cost of one particular innovation –cryptocurrencies – is soaring…
This issue is becoming increasingly relevant with the soaring environmental costs of Bitcoin mining, which could consume as much energy as Italy and Saudi Arabia combined by 2024 if not contained.Estimates vary but they agree that the carbon footprint of cryptocurrencies is far from negligible. “
The ESMA adds that although the distributed ledger technology (DLT) – the engine that powers cryptocurrencies – may have interesting use cases, the energy consumption of some DLT protocols can also be a source of environmental concern.
“DLT has the potential to enhance firms’ efficiency and improve consumer outcomes but applications are still limited. Scalability, interoperability and cyber-resilience will require monitoring as DLT develops. Other challenges include anonymity as well as governance and privacy issues.”
The ESMA says that crypto assets (CA) exist outside of European regulations and will require increased monitoring moving forward.
“Most crypto assets are highly volatile in price and operate outside of the existing EU regulatory framework, which raises investor protection issues. Interconnectedness risk requires monitoring as CAs grow in size.”
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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.
A recent poll from Sherlock Communications has found that nearly half of Brazilians agree that Bitcoin should be adopted as the currency of the country, following in the footsteps of El Salvador.
Brazilians Bullish for Bitcoin
As reported by Valor Investe, the study shows 48% of Brazilians in support of Bitcoin as national currency (17% strong support, 31% moderate support). In contrast, only 21% rejected the idea (9% strong rejection, 12% moderate rejection). The other 30% of respondents were indifferent on the matter.
The survey was carried out through the online research platform Toluna and studied support for Bitcoin and cryptocurrency across various other Central and South American countries. Those included Argentina, Chile, Colombia, Costa Rica, El Salvador, Venezuela, and Mexico. Of all the aforementioned regions, Brazilians showed the most support for the primary cryptocurrency.
“Brazilians were the biggest advocates of crypto-recognition in the region, with 56% supporting El Salvador’s approach and 48% saying they want Brazil to adopt it as well,” says the study.
Notably, Brazilians’ interest seems to be uniquely concentrated on Bitcoin. BTC was by far the most notorious among those polled, with 92% recognizing it. Meanwhile, only 31% and 30% of respondents knew of Ethereum and Litecoin, respectively – two of the most popular altcoins on the market.
Bitcoin: Risky or Secure?
Despite common media depictions of Bitcoin as a ‘risky’ investment, Brazilian support for it rests on the exact opposite assumption. When asked about their reasons for investing in cryptocurrencies, 39% of respondents cite “protection against inflation and financial instability” as a contributing factor. Other major reasons include diversifying investments (55%) and following technology trends (37%).
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This would be in line with the views of the El Salvadoran government, which has repeatedly been purchasing hundreds of Bitcoin at a time in the last few days. President Nayib Bukele remains confident that his decision to invest and adopt Bitcoin as legal tender will benefit his people and move the country forward. This is in opposition to the opinions of both JP Morgan and the World Bank.
Luiz Eduardo Abreu Haddad, a Sherlock bank consultant, recognizes the importance of El Salvador’s first step in guiding the views and actions of neighboring countries regarding Bitcoin:
“The El Salvador experiment could become a great reference for Latin American countries on how to incorporate blockchain and cryptocurrencies into their economies and generate well-being for their citizens.”
While Brazilians seem more open-minded toward BTC adoption, Americans are not on the same page. Another recent study determined that only 27% would support it if the US legalizes bitcoin.
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Australian digital asset manager Monochrome has concluded a $1.8 million Series A fundraiser led by some of crypto’s most influential entrepreneurs, underscoring the growing potential of institutional-grade crypto-asset solutions.
The cash injection will be used by Monochrome to develop new products specializing in Bitcoin (BTC) and other digital assets, the company said. The Series A was co-led by Litecoin creator Charlie Lee, Blockstream chief strategy officer Samson Mow, former Binance CFO Wei Zhou and Kain Warwick, the founder of Blueshyft and DeFi protocol Synthetix. Following the raise, Monochrome’s total valuation was estimated to be worth roughly $15 million.
Monochrome was launched earlier this year by Jeff Yew, the former chief executive of Binance Australia, to provide an institutional onramp to cryptocurrency investing. The company is perhaps best known for the Monochrome Bitcoin Fund, a capital growth vehicle for wholesale investors. The fund targets a near 100% allocation to physical Bitcoin, which is custodied by U.S. trust company BitGo Trust.
Wei Zhou described Monochrome as Australia’s “leading investment firm specializing in regulated access into digital assets,” underscoring the country’s “progressive regulatory stance” towards cryptocurrency.
Like other advanced industrialized nations, Australia’s cryptocurrency regulations are still in their nascent stages. While the country does not recognize crypto as money, digital asset trading is legal in the country and is subject to Anti-Money Laundering and Counter-Terrorism Financing regulations. As Cointelegraph recently reported, Australia’s financial regulator recently warned citizens against using unregistered cryptocurrency businesses.
Related:Australian crypto businesses tell Senate inquiry about being de-banked up to 91 times
Monochrome, like other crypto-focused asset managers, is targeting institutional investors for inclusion in the digital-asset economy. Demand for crypto among institutional players appears to be growing, as evidenced by the large inflows into Grayscale and CoinShares products, among others. Surveys of institutional investors also reveal that a large percentage of wealth managers are planning to buy crypto investments or increase their exposure to the assets.
Related:Franklin Templeton seeks experts for Bitcoin trading and crypto research
With Bitcoin standing the test of time, more investors are likely to seek out exposure to digital assets in pursuit of broader macroeconomic objectives. Financial advisers could lead the charge now that crypto investing has been significantly de-risked from a career reputation standpoint.
The consensus mechanism used by Bitcoin is the only way to ensure true lasting freedom.
Delegated proof-of-take (DPoS) is a fundamentally different consensus protocol from proof-of-ork (PoW). The difference between the two presents itself in the kind of freedom they promote; while DPoS is freedom under a benign master, PoW is freedom from domination.
What Is Freedom?
Freedom can be understood in negative or positive terms, thanks to Isaiah Berlin. Negative freedom, according to Berlin, is the absence of interference or constraints. Positive freedom, by contrast, is having the capacity to do something to realize one’s potential. Negative freedom is also known as liberal freedom. According to the classical political philosophers that Berlin followed (Hobbes, for instance), one can enjoy freedom only when free from interference. It does not matter if there is a master who can arbitrarily interfere. If there are multiple doors to choose from and gatekeepers at each door, liberals argue that freedom means choosing and going through a door without interference. Keep this analogy in mind.
I’ve argued elsewhere that bitcoin freedom comprises both negative and positive freedom. Quentin Skinner defines this new conception of freedom as neo-Roman, and Phillip Pettit coins the term republican freedom as non-domination. With a minuscule difference, they both argue the same idea of freedom. Freedom as non-domination is negative because it promises freedom from domination (arbitrary interference) and positive freedom because it promotes practices to realize its potential. However, the most distinct aspect of freedom as non-domination is the ability to control power. Following the door analogy above, there can be gatekeepers, but citizens must control their behavior to practice their freedom of choosing and going through a door. Merely an absence of interference does not mean we are free because an arbitrary decision of a gatekeeper might take our freedom away. Being vigilant to check and control gatekeepers’ power is critical in freedom as non-domination.
Why PoW Is Essential For Freedom As Non-Domination
Freedom and decentralization are indispensable from each other because freedom can be possible only under decentralized power. Power needs to be broken up to secure liberty. A similar argument by Montesquieu in 1748 established one of the most critical pillars of democratic government: separation of power (see my short essay). For citizens to be free, branches of the government have to be separated so that they check and balance each other. Bitcoin, in this respect, promotes freedom as non-domination through its PoW consensus mechanism because a vast number of independent nodes to validate transactions and create new blocks is critical in dispersing the power for blockchain. If this power is concentrated in a few nodes, then the chances of arbitrary action of a blockchain would be easier, hence risks the freedom it promotes.
DPoS: Freedom Under A Benign Master
Delegated proof-of-stake is a consensus protocol that disperses the power to validate transactions and create new blocks to a few nodes. In a DPoS protocol, a few nodes take turns to produce blocks and validate transactions. In other words, the freedom of DPoS users is controlled by a few node operators. Although one could argue that those nodes are alternating between doing the work and are not functioning in a centralized fashion, thousands of Bitcoin nodes disseminated worldwide are absolutely more decentralized and secure. As discussed above, the more decentralized, the more security for freedom can be promoted.
Can we be free under a benign master? No! Freedom is not freedom unless there is some guarantee for maintaining that freedom for tomorrow. The master(s) of the blockchain run on the DPoS consensus mechanism can be good and benign today. They can “give” freedom to the users. Yet, the checks and balances to the power of the masters are much less vigorous than in Bitcoin. The freedom that is given can be taken away. For this reason, a mere possibility of interference creates domination. Bitcoin freedom, on the other hand, is freedom from domination. There are no “benevolent” gatekeepers who can change their minds in the future on a whim. The difference, in a nutshell, is between a benign master who gives freedom and an empowered citizenry of nodes that takes it.
This is a guest post by Burak Tumaç. Opinions expressed are entirely their own and do not necessarily reflect those of BTC Inc or Bitcoin Magazine.
