Bitcoin won’t work as a currency unless it’s tied to Gold ...

I bought $1k of the Top 10 Cryptos on January 1st, 2018 (Oct Update - Month 34)

I bought $1k of the Top 10 Cryptos on January 1st, 2018 (Oct Update - Month 34)

EXPERIMENT - Tracking Top 10 Cryptos of 2018 - Month Thirty-Four - Down -74%
See the full blog post with all the tables here.
tl;dr
  • I'll give the first one to find the four hidden cultural references some moons.
  • What's this all about? I purchased $100 of each of Top Ten Cryptos in Jan. 2018, haven't sold or traded. Did the same in 2019 and 2020. Learn more about the history and rules of the Experiments here.
  • October - BTC and Litecoin had a very good month and crypto as a whole did much better than traditional markets.
  • Overall since Jan. 2018 - Bitcoin still far ahead. And, for the first time since I started this experiment back in Jan. 2018, I'm happy to report: BITCOIN HAS BROKEN EVEN!!!
  • Combining all three three years, Top Ten cryptos is tied with the S&P if I'd taken a similar approach.

Month Thirty Four – Down 74%

2018 Top Ten Summary for October
After an all-red September, it’s nice to see a bit of green this month. Thanks mainly to Bitcoin, the 2018 Top Ten Portfolio finished October with modest gains overall.
But, STOP THE PRESS, what is that!??! Green in the “Total % Change” column!?!? Yes indeed: for the first time in 34 monthly updates, I’m happy to announce that BTC ended October worth more than the price I paid for it on the 31st of December, 2017. Although only up +4% overall, it’s been a long road: this small 2018 Top Ten victory is to be celebrated.

Question of the month:

In October, this global payment service announced it will support cryptocurrency buying, selling, and shopping through its platform.

A) Paypal
B) Square
C) Stripe
D) Alipay
Scroll down for the answer.

Ranking and October Winners and Losers

Rank of 2018 Portfolio - 40% of cryptos are drop outs
Not much movement this month, a bit strange for the 2018 Top Ten Portfolio. Only three cryptos shifted positions in October: NEM’s Top Twenty hopes seem to be fading fast (it dropped from #22 to #24); XLM picked up one spot (#18 to #17); and, much to the relief of long time crypto-ers with a soft spot for the silver to BTC’s gold, Litecoin was able to stop its freefall, rebounding back into the Top Ten nicely, picking up four spots (#12 to #8). Welcome back LTC.
Drop outs: After thirty-four months of this experiment 40% of the cryptos that started 2018 in the Top Ten have dropped out. NEM, Dash, IOTA, and Stellar have been replaced by Binance Coin, Tether, LINK, and most recently, DOT.
October Winners – For the second month in a row, this month’s W goes to Bitcoin, up +25% for the month. Litecoin finishes the month in second place, up 17% and climbing back into the Top Ten.
October Losers – For the second month in a row, this month’s L goes to NEM, down -16%. IOTA finished down -11%, the second worst performer of the month.
For the overly competitive nerds, below is a tally of the winners of the first 34 months of the 2018 Top Ten Crypto Index Fund Experiment. Bitcoin still has the most monthly wins (9) and Cardano in second place with 6 monthly wins. With another poor performance in October, NEM now has 8 monthly losses.
Every crypto has at least one monthly win and Bitcoin is unique as the only cryptocurrency that hasn’t lost a month yet since January 2018.
Ws and Ls - One coin to rule them all

Overall update – BTC far ahead and breaks even, ETH in distant second place. Dash in last place.

So here we are: point break even. On the 31st of December, 2017, I bought $100 worth of BTC (0.008) at $13,170. Nearly three years later that same 0.008 is worth $13,665. Although only 4%, it’s a symbolic victory and one that’s been a long time coming. The initial investment of $100 thirty-three months ago is now worth about $83. A distant second place, Ethereum is down -45% since January 2018.
At this point in the 2018 Top Ten Experiment, Dash is at the bottom. It has lost -93%. The initial $100 invested in Dash 34 months ago is now worth $6.52.
The 2018 Portfolio welcomed LTC back Top Ten in October. September 2020 was the first time since I started the experiment back in January 2018 that Litecoin had fallen out of the Top Ten.

Total Market Cap for the entire cryptocurrency sector:

Total market cap - back over the $400B mark for the first time in over 2.5 years
The crypto market gained about $50B in finished October over the psychologically important $400B mark, a level we haven’t seen since the end of April 2018.

Bitcoin dominance:

BitDom - growing
After a few months of dipping, BitDom shot back up to 63.1% in October. A big move, but for context, it was up over 68% earlier in 2020.
For even more context: since the beginning of the experiment, the range of Bitcoin dominance has been quite wide: we saw a high of 70% BitDom in September 2019 and a low of 33% BitDom in February 2018.

Overall return on $1,000 investment since January 1st, 2018:

2018 Top Ten ROI
The 2018 Top Ten Portfolio gained about $25 bucks in October. Despite BTC breaking even, the portfolio overall is still struggling: if I cashed out today, the $1000 initial investment would return about $264, down -74% from January 2018.
Down -74% sounds bad (and it is), but the overall direction lately has been encouraging and a nice break from the negative eighties. Here’s a look at the ROI over the life of the experiment, month by month, for some context:

2018 Top Ten Monthly ROI - Red, red, red
The absolute bottom was -88% back in January 2019.
So the Top Ten Cryptos of 2018 are down -76%. What about the 2019 and 2020 Top Tens? Let’s take a look:
So overall? Taking the three portfolios together, here’s the bottom bottom bottom line:
After a $3000 investment in the 2018, 2019, and 2020 Top Ten Cryptocurrencies, my combined portfolios are worth $‭3,537‬ ($264+ $1,660 +$1,613).
That’s up about +18% for the three combined portfolios, compared to +11% last month.
Here’s a table to help visualize:
Combined 2018, 2019, 2020 ROI
That’s a +18% (actually +17.9%) gain by investing $1k on whichever cryptos happened to be in the Top Ten on January 1st for three straight years.
But surely you’d do better if you went all in on one crypto, right?
Depends on your choice. Let’s take a look:
Three year club: BTC and ETH tied
Only five cryptos have started in the Top Ten for all three years: BTC, ETH, XRP, BCH, and LTC. Knowing what we know now, which one would have been best to go all in on?
As of this month, it’s basically a tie between BTC and ETH. Both are up +121%, (although BTC is technically $21 ahead of ETH).
So: with $3,000 USD, dropped in $1k chunks on January 1st three times in a row since New Year’s Day 2018, you would be up +121%, by going all in on either BTC or ETH.
The worst choice? At this point in the experiment, that would be XRP, down -32%.

Comparison to S&P 500:

I’m also tracking the S&P 500 as part of the experiment to have a comparison point with other popular investments options. The S&P 500 Index continued its fall from an all time high in August. It ended October up +22% since January 2018.

Monthly S&P since January 2018
The initial $1k investment into crypto on January 1st, 2018 would have been worth about $1220 had it been redirected to the S&P.
But what if I took the same invest-$1,000-on-January-1st-of-each-year approach with the S&P 500 that I’ve been documenting through the Top Ten Crypto Experiments? Here are the numbers:
  • $1000 investment in S&P 500 on January 1st, 2018 = $1220 today
  • $1000 investment in S&P 500 on January 1st, 2019 = $1300 today
  • $1000 investment in S&P 500 on January 1st, 2020 = $1010 today
Taken together, here’s the bottom bottom bottom line for a similar approach with the S&P:
After three $1,000 investments into an S&P 500 index fund in January 2018, 2019, and 2020, my portfolio would be worth $3,530.
That is up +17.6% since January 2018. Compared to a +17.9% gain of the combined Top Ten Crypto Experiment Portfolios. You can compare against five individual coins (BTC, ETH, XRP, BCH, and LTC) by using the table above if you want.
Gentlemen and lady (hello lady, I see you back there) we have a tie.
Well, not quite a tie, crypto is up .3% so crypto gets the win:
Three year S&P vs. Top Ten Crypto Experiments Combined ROI
That’s seven monthly victories for the S&P vs. three monthly victories for crypto. The largest gap so far was a 22% difference in favor of the S&P in June.

Conclusion:

October saw a bit of divergence between crypto and the S&P: crypto up, S&P down. That separation is nice to see when it often seems that crypto moves in tandem with traditional markets. Two more months left in the year. What more will 2020 throw at us? And how will crypto and traditional markets respond?
Thanks for reading and for supporting the experiment. I hope you’ve found it helpful. I continue to be committed to seeing this process through and reporting along the way. Feel free to reach out with any questions and stay tuned for progress reports. Keep an eye out for my parallel projects where I repeat the experiment twice, purchasing another $1000 ($100 each) of two new sets of Top Ten cryptos as of January 1st, 2019 then again on January 1st, 2020.

And the Answer is…

A) Paypal
Paypal announced in October that it will allow customers to buy, sell, and hold Bitcoin and other cryptocurrencies. Customers will also be able to pay with crypto at 26 million merchants on its network starting in early 2021.
submitted by Joe-M-4 to CryptoCurrency [link] [comments]

Here is how to play the altcoin game - for newbies & champs

I have been here for many previous altcoin seasons (2013,2017 etc) and wanted to share knowedle. It's a LOOONG article.
The evaluation of altcoins (i.e not Bitcoin) is one of the most difficult and profitable exercises. Here I will outline my methodology and thinking but we have to take some things as a given. The first is that the whole market is going up or down with forces that we can't predict or control. Bitcoin is correlated with economic environments, money supply increases, safe havens such as Gold, hype and country regulations. This is an impossible mix to analyze and almost everyone fails at it. That's why you see people valuing Bitcoin from $100 to $500k frequently. Although I am bullish on the prospects of Bitcoin and decentralization and smart contract platforms, this is not the game I will be describing. I am talking about a game where you try to maximize your BTC holdings by investing in altcoins. We win this game even if we are at a loss in fiat currency value. To put it another way:
If you are not bullish in general on cryptocurrencies you have no place in investing or trading cryptocurrencies since it's always a losing proposition to trade in bubbles, a scientifically proven fact. If on the other hand you are then your goal is to grow your portfolio more than you would if holding BTC/ETH for example.

Bitcoin is the big boy

How the market works is not easily identifiable if you haven't graduated from the 2017 crypto university. When there is a bull market everything seems amazingly profitable and things keep going up outgrowing Bitcoin by orders of magnitude and you are a genius. The problem with this is that it only works while Bitcoin is going up a little bit or trades sideways. When it decides to move big then altcoins lose value both on the way up and on the way down. The second part is obvious and proven since all altcoins from 2017 are at a fraction of their BTC value (usually in the range of 80% or more down). Also, when BTC is making a big move upwards everyone exits altcoins to ride the wave. It is possible that the altcoin market behaves as an inversed leveraged ETF with leakage where in a certain period while Bitcoin starts at 10k and ends at 10k for example, altcoins have lost a lot of value because of the above things happening.

We are doing it anyway champ!

OK so we understand the risks and just wanna gambol with our money right? I get it. Why do that? Because finding the ideal scenario and period can be extremely profitable. In 2017 several altcoins went up 40x more than BTC. But again, if you don't chose wisely many of them have gone back to zero (the author has first hand experience in this!), they have been delisted and nobody remembers them. The actual mentality to have is very important and resembles poker and other speculative games:
A certain altcoin can go up in value indefinitely but can only lose it's starting investment. Think about it. You either lose 1 metric or gain many many more. Now that sounds amazing but firstly as we said we have the goal to outperform our benchmark (BTC) and secondly that going up in value a lot means that the probability is quite low. There is this notion of Expected Value (EV) that poker players apply in these kind of situations and it goes like that. If you think that a certain coin has a probability let's say 10% to go up 10X and 90% probability it goes to zero it's an even bet. If you think that probability is 11% then it's a good bet, a profitable bet and you should take it. You get the point right? It's not that it can only go 10X or 0X, there is a whole range of probability outcomes that are too mathematical to explain here and it doesn't help so much because nobody can do such analysis with altcoins. See below on how we can approximate it.

How to evaluate altcoins

A range of different things to take into account outlined below will form our decision making. Not a single one of them should dictate 100% of our strategy.

Basics

It's all about market cap. Repeat after me. The price of a coin doesn't mean anything. Say it 10 times until you believe it. I can't remember how many times I had conversations with people that were comparing coins using their coin price instead of their market cap. To make this easy to get.
If I decide because the sky is blue to make my coin supply 100 Trillion FoolCoins with a price of $0.001 and there is another WiseCoin with a supply of 100 Million and price of $1 then FoolCoins are more expensive. - Alex Fin's Cap Law

Fundamental analysis

This is done usually in the stock world and it means that each company has some fundamental value that includes it's assets, customers, growth prospects, sector prospects and leadership competence but mostly centered in financial measures such as P/E ratios etc. Valuation is a proper economic discipline by itself taught in universities. OK, now throw everything out of the window!.
This kind of analysis is impossible in vague concepts and innovations that are currently cryptocurrencies. Ethereum was frequently priced at the fictional price of gas when all financial systems on earth run on the platform after decades (a bit of exaggeration here). No project is currently profitable enough to justify a valuation multiple that is usually equal to P/E in the thousands or more. As such we need to take other things into account. What I do is included in the list below:

Relative valuation

One of my favorite ways to value altcoins that is based on the same principle in the stock market is to look at peers and decide what is the maximum cap it can grow to. As an example you take a second layer Ethereum solution that has an ICO and you want to decide if you will enter or not. You can take a look at other coins that are in the same business and compare their market caps. Thinking that your coin will outperform by a lot the top coins currently is overly optimistic so I usually take a lower valuation as a target price. If the initial offering is directly implying a valuation that is more than that then there is no room to grow according to my analysis and I skip it. Many times this has proven me wrong because it's a game theory problem where if many people think irrationally in a market it becomes a self-fulfilling prophecy. But since there is opportunity cost involved, in the long run, getting in initial offerings that have a lot of room to grow will pay off as a strategy.

Sector prospects

In 2017 the sexiest sector was platforms and then coins including privacy ones. Platforms are obviously still a highly rated sector because everything is being built on them, but privacy is not as hot as it used to be. In 2018 DEXes were all they hype but still people are massively using centralized exchanges. In 2020 Defi is the hottest sector and it includes platforms, oracles and Defi projects. What I am saying is that a project gets extra points if it's a Defi one in 2020 and minus points if it's a payment system that will conquer the world as it was in 2017 because that's old news. This is closely related to the next section.

Hype

Needless to say that the crypto market is a worse FOMO type of inexperienced trigger happy yolo investors , much worse than the Robinhood crowd that drove a bankrupt company's stock 1200% after they declared bankruptcy. The result is that there are numerous projects that are basically either vaporware or just so overhyped that their valuation has no connection to reality. Should we avoid those kind of projects? No and I will explain why. There are many very good technically projects that had zero hype potential due to incompetent marketing departments that made them tank. An example (without shilling because I sold out a while back) is Quantum Resistant Ledger. This project has amazing quantum resistant blockchain, the only one running now, has a platform that people can build tokens and messaging systems and other magnificent stuff. Just check how they fared up to now and you will get the point. A project *needs* to have a hype factor because you cannot judge it as normal stocks that you can do value investing like Warren Buffet does where a company will inevitable post sales and profitability numbers and investors will get dividends. Actually the last sentence is the most important: No dividends. Even projects that give you tokens or coins as dividends are not real dividends because if the coin tanks the value of the dividend tanks. This is NOT the case with company stocks where you get dollars even if the company stock tanks. All that being said, I would advice against betting on projects that have a lot of hype but little substance (but that should be obvious!).

How to construct your portfolio

My strategy and philosophy in investing is that risk should be proportional to investment capital. That means that if you are investing 100K in the crypto market your portfolio should be very different than someone investing 1K because 10% annual gains are nothing in the latter while they are very significant in the former. Starting from this principle each individual needs to construct a portfolio according to how much risk he wants to take. I will emphasize two important concepts that play well with what I said. In the first instance of a big portfolio you should concentrate on this mantra: "Diversification is the only free meal in finance". In the case of a small portfolio then this mantra is more important: "Concentrate to create wealth, diversify to maintain wealth". Usually in a big portfolio you would want to hold some big coins such as BTC and ETH to weather the ups and downs explained in previous paragraphs while generating profits and keep progressively smaller parts of your portfolio for riskier investments. Maybe 50% of this portfolio could be big caps and 10% very risky initial offerings. Adapting risk progressively to smaller portfolios makes sense but I think it would be irrational to keep more than 30% of a portfolio no matter what tied to one coin due to the very high risk of bankruptcy.

Conclusion

The altseason is supposedly coming every 3 months. Truth is that nobody can predict it but altcoins can be profitable no matter what. Forget about maximalists who are stuck in their dogmas. Altcoins deliver different value propositions and it makes sense because we are very far from a situation where some project offers everything like Amazon and we wouldn't even want that in the first place since we are talking about decentralization and not a winner takes all and becomes a monster kind of scenario! Some last minute advice:
P.S If you find value in reading this and want more weekly consider subscribing to my newsletter here
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Zombie Apocalypse Edition - I bought $1000 worth of the Top Ten Cryptos on January 1st, 2018 (March 2020 Update)

Zombie Apocalypse Edition - I bought $1000 worth of the Top Ten Cryptos on January 1st, 2018 (March 2020 Update)
2018 \"Index Fund\" EXPERIMENT - Tracking Top 10 Cryptocurrencies of 2018 - Mar 2020/Month Twenty-Seven Update - Down 87%
See the full blog post with all the tables here.
tl;dr - take care of yourselves, your families, and your communities. Keep up the social distancing, bend the curve, wash your hands. Be careful out there. And - a truly insane month. Despite the market meltdown, crypto has under-performed the market since January 2018 by quite a bit. But if you measure from Jan 2019 or Jan 2020 it's a different story.

Month Twenty-Seven – Down 87%

Welcome to the special COVID/Zombie Apocalypse version of the update. An all red month, but, meh, this is cypto, we’re used to it.

Ranking and March Winners and Losers

For such a crazy month, there wasn’t much movement with this group. For the second month in a row, Cardano fell two positions and Bitcoin Cash slipped one slot. NEM was the only crypto to climb, up one position in March. Always got to take the opportunity to report something positive about NEM!
The overall drop out rate is still at 50% mark (meaning half of the cryptos that started 2018 in the Top Ten have dropped out). NEM, Dash, IOTA, Cardano, and Stellar have been replaced by EOS, Binance Coin, Tezos, Tether, and BSV.
March WinnersBitcoin squeaked out a victory in March, although BTC was basically in a three way tie this month with XRP and Dash. All were down -23%.
March Losers – In an all red month, ETH and Cardano did especially poorly, down -38% and -33% respectively.
Below is tally of which coins have the most monthly wins and losses in the first 27 months of the 2018 Top Ten Crypto Index Fund Experiment. Most monthly wins (7): Bitcoin. Most monthly losses (5): Stellar. All cryptos have at least one monthly win and Bitcoin now stands alone as the only crypto that hasn’t lost a month (although it came close in January 2020), when it gained “only” +31%).

Overall update – BTC far ahead, ETH and LTC virtually tied for second place, IOTA and NEM virtually tied for last place.

Although down -50% from January 2018, Bitcoin is still well ahead of the field. Ethereum and Litecoin are almost tied for second place, down -81% and -82% respectively.
While NEM technically remains in the basement, IOTA is knocking at the door. Both are down -96%, and IOTA is now only a few cents off in total return.

Total Market Cap for the entire cryptocurrency sector:

The overall crypto market lost about $60B in March 2020 and is now down -68% from January 2018.

Bitcoin dominance:

Bitcoin dominance bounced up about +1.5% in March, something we’ve seen time and time again over the course of the experiment when the market bleeds. For context, the range since the beginning of the experiment in January 2018 has been quite wide: a high of 70% in September 2019 and a low of 33% in February 2018.

Overall return on investment since January 1st, 2018:

The 2018 Top Ten Portfolio lost about $53 bucks in March 2020. If I cashed out today, my $1000 initial investment would return about $133, down -87% from January 2018. This isn’t quite the low point for the 2018 Top Ten (the portfolio was down -88% in January 2019) but pretty close.
See, here’s the ROI over the life of the experiment, month by month:
A sea of red. The closest the 2018 Top Ten group has come to breaking even was after the very first month, when the portfolio was down “only” -20%. March 2020 is now the eighth consecutive time the portfolio has ended the month down at least -80%.
The 2019 and 2020 Top Ten Experiments are still in positive territory, but not by much:
Taking the three portfolios together, here’s the bottom bottom bottom line:
After a $3000 investment in the 2018, 2019, and 2020 Top Ten Cryptocurrencies, my portfolios are worth $2,267‬.
After finally, at sweet long last, ending the first few months of 2020 in positive territory for the combined portfolios (January up +13% and February up +6%), that’s down about -24% total. Thanks coronavirus.
Alright, but it’s the end of the world as we know it, everything’s tanking. How does this compare to traditional markets?

Comparison to S&P 500:

I’m also tracking the S&P 500 as part of my experiment to have a comparison point with other popular investments options. March 2020 was not a great month for the S&P: it lost over -20% of its value this month and is currently at the lowest point since the experiment began in January 2018: -8% since the start of 2018. The initial $1k investment into crypto would have lost me about -$80 had it been redirected to the S&P.
Taking the same drop-$1,000-per-year-on-January-1st approach with the S&P 500 that I’ve been documenting through the Top Ten Crypto Experiments would yield the following:
  • $1000 investment in S&P 500 on January 1st, 2018: -$80
  • $1000 investment in S&P 500 on January 1st, 2019: -$10
  • $1000 investment in S&P 500 on January 1st, 2020: -$230
Taken together, here’s the bottom bottom bottom line for a similar approach with the S&P:
After three $1,000 investments into an S&P 500 index fund in January 2018, 2019, and 2020, my portfolio would be worth $2,680.
That’s down about -11% compared to -24% with the Top Ten Crypto Experiment Portfolios.
That’s a 13% difference. Last month the gap was only 1%.

Implications/Observations:

The experiment’s focus of solely holding the Top Ten Cryptos has never been a winning approach when compared to the overall market. The total market cap is down -68% from January 2018 compared to the -87% for the cryptos that began 2018 in the Top Ten. This of course implies that I would have done a bit better if I’d picked different cryptos.
At no point in this experiment has this investment strategy been successful: the initial 2018 Top Ten have under-performed each of the twenty-seven months compared to the market overall.
There are a few examples of this approach outperforming the overall market in the parallel 2019 Top Ten Crypto Experiment, but these cases are few and far between. In contrast, each of the first three months of the 2020 Experiment show that focusing on the Top Ten beats the overall market.

Conclusion:

With COVID affecting the entire globe and no end in sight, the next few months will be tough. We should have a better idea whether crypto is seen as a gold-like safe haven during tough times, as some have suggested.
Final word: take care of yourselves, your families, and your communities. Keep up the social distancing, bend the curve, wash your hands. Be careful out there.
Thanks for reading and for supporting the experiment. I hope you’ve found it helpful. I continue to be committed to seeing this process through and reporting along the way. Feel free to reach out with any questions and stay tuned for progress reports. Keep an eye out for my parallel projects where I repeat the experiment twice, purchasing another $1000 ($100 each) of two new sets of Top Ten cryptos as of January 1st, 2019 then again on January 1st, 2020.
submitted by Joe-M-4 to CryptoCurrency [link] [comments]

If you missed the AMA

AMA AT DETECTIVE ID (25/06/2020)
Before welcoming any questions, I would like to briefly introduce STATERA PROJECT. Statera is a smart contract deflationary token pegged to a cryptocurrency index fund. By including STA in an index fund with Link, BTC, ETH, and SNX you can buy one token and access the price action of four of the leading cryptocurrencies. You can also invest directly in the index fund (balancer pool) and receive the benefits of fees and BAL tokens paid to you while also having an automatically balanced fund. Lastly the deflationary mechanics of STA increases the chance for positive price action while decreasing beta (volatility). This is all found in a smart contract that is fully decentralized, the founders can no longer augment the contract in any way and this has been confirmed by a third party code audit through Hacken.
Q1 : please explain in more detail about Statera, what is the background of this project? and when was it established?
The dev of this project had previously created another deflationary token BURN. When the Balancer Labs released the Balancer Protocol, he had an idea to combine the two, deflationary token and a pool of tokens, making the first deflationary index fund. It started in the end of May and on the 3rd iteration, May 29th - a trustless version was launched that we see today. As briefly explained earlier, STATERA or STA is an Index Deflationary Token built on Ethereum blockchain; Index: Contains a token suite of world class leading crypto assests BTC, ETH, LINK, SNX with STA. Deflationary: On every transaction of STA 1% of the transacted amount is sent to 0x address on ethereum, burned forever, thus reducing the circulating supply of STA Index+Deflationary: STA is mixed with BTC, ETH, LINK SNX in a portfolio, backed by liquidity on a protocol known as balancer (balancer.finance) This platform serves as a market maker for the token suit. The Index suite is of equal rate of 20%, that is 20% of BTC, ETH, SNX LINK and STA, Thus, anytime there is an increase in value of any of those coins or tokens, balancer automatically trade them for STA in order to keep the token suit ratio balanced. And anytime there is an increase in the value of STA, the same process applies. while doing this trade, it enables further burning on every transaction, thus facilitating more token scarcity. In addition to this, Statera was deployed with contract finalised, that is, the index suite can not be altered, It is completely out of Dev's control.
Q2 : What are the achievements that have been obtained by Statera in 2020? And what goals do you want to achieve in 2020?
By this we assume the questionnaire is asking for a roadmap! First, the project is barely a month old, and within just a month, our liquidity has grown from $50,000 to over $400,000 currently above $300,000. Among the things we have accomplished so far is the creation of market value for STA's Balancer liquidity pool token BPT, which is currently over $1000 per one BPT. Regarding what we set to achieve: The future is filled with many opportunities and potentials, currently, we are working on a massive campaign to introduce our product to the outside world. We have already made contact with different and reputable forums and channels regarding marketing and advertisement offers, some which we are currently negotiating, some which we are awaiting response. All we can say for now is that the Team is working hard to make this the Investment opportunity every crypto enthusiast has been waiting for. Statera has the goal of putting cryptocurrency into every portfolio. We believe we have a product that increases the returns of investing in cryptocurrencies and makes it easier to diversify in this space. We have done so much in June: articles, how to videos, completed the audit, tech upgrades like one token liquidity additions, and beginning our many social communities. We have been hard at work behind the scenes but things like sponsorships, features, and media take time, content makers need days if not weeks to develop content, especially the best of the best. We are working tirelessly, we will not disappoint. We have plans for 2020-2025 and will release those in the next month. They are big and bold, you’re going to be impressed by the scale of our vision, when we say “Cryptocurrency in every portfolio” we mean it. In 2020 more specifically we are focused on more media, videos, product offerings, and exchanges.
Q3 : What is the purpose of STA token? How can we get STA? The purpose of STA is an investment in the first deflationary index fund. The whole index's value rises from these aspects: 1. The index funds (WBTC,WETH,SNX,LINK) appreciate in value 2. When the index tokens are traded, the pool receives transaction fees - 1% 3. STA burns on transactions, so it's deflationary nature increases its value as the total supply drops 4. Balancer rewards Index holders with BAL token airdrops every week You can invest via the 'Trade' links in stateraproject.com website. Easiest way is to do it using ETH. The monetary policy of our token is set in stone and constantly deflationary. This negative supply pressure is a powerful mechanism in economics and price discovery. Through the lowering of supply we can decrease your beta (volatility) and increase your alpha (gains). Our token is currently only top 40 in liquidity on Balancer, however our volume is top 10! You want to know why? Because Statera works. Statera increases arbitrage, volume, fees, BAL rewards, and liquidity. Our liquidity miners in our Balancer pool are already making some of the highest BAL rewards on the platform, one user we spoke with made 18% in June, that’s over 150% APY! Our product is working, 100% (or you could say 150%), and when people start to see that, and realize the value, the sky's the limit.
Q4 : can we as a user do STA mining? The supply of STA doesn't increase anymore, it only decreases due to the burn feature. So there is no way to mine anymore STA. Only way to acquire the tokens is via an exchange. The monetary policy of our token is set in stone and constantly deflationary. This negative supply pressure is a powerful mechanism in economics and price discovery. Through the lowering of supply we can decrease your beta (volatility) and increase your alpha (gains). Our token is currently only top 40 in liquidity on Balancer, however our volume is top 10! You want to know why? Because Statera works. Statera increases arbitrage, volume, fees, BAL rewards, and liquidity. Our liquidity miners in our Balancer pool are already making some of the highest BAL rewards on the platform, one user we spoke with made 18% in June, that’s over 150% APY! Our product is working, 100% (or you could say 150%), and when people start to see that, and realize the value, the sky's the limit.
Q5 : The ecosystem of a public chain has a lot to do with the level of engagement and participation of third-party developers. How does Statera support the developers?
Not really. Our project is focusing on investment opportunities for the cryptocurrencies. The cryptocurrency tokens that are not used and are just sitting in a wallet can work for you by being added to an index fund and appreciate in value over time. First off, what we have created is a new asset class, I’ll repeat that, a new asset class. This asset has never existed: “Deflationary Index Fund,” what does that mean for finance? What will developers do with this? It’s hard to give a finite answer. We hope there are future economic papers on our token and what it means to be a deflationary index fund. With the addition of synthetic assets and oracles you can put any asset into the DeFi space: Gold, Nikkei 225, USD, etc. STA can be combined with any assets and bring the benefits of it’s ecosystem and deflationary mechanism to that asset. STA, the token itself, also gives you access to the price action of any asset it is paired with. Put simply STA’s balancer pool(s) give you a benefit in holding them, and STA’s price will reflect it’s inclusion in Balancer Pool(s) (and possibly future financial instruments), so STA is a bet on DeFi as a whole. When we say as whole, we mean as whole: what happens if you include STA in a crypto loan, or package it with a synthetic S&P 500 token, or use it as fee payment in a DeFi platform? Being fully decentralized it is up to our community to make this happen, social engagement and community are key. We are constantly bringing community members onto our team and rewarding those that benefit the ecosystem. in addition, Statera is a fully community project now. Paul who is the current team leader was an ordinary member of the community weeks ago, due to his interest and support for the project, he started dedicating his time to the project. Quite a number of community members are also in the same position, while Statera was developed by an individual, it is being built by the entire Statera community
Community Questions (Twitter):
Q1 From: @KazimKara35 The project tells us that the acquisition and sale of data between participants is protected by code of conduct and how safe is deployed on the blockchain, but how do you handle regulations while operating on a global scale?
Statera is decentralized token, similar to other utility crypto tokens and same regulations apply to it as others. his is actually a benefit of our decentralized nature. This isn’t legal advice, however in the past regulating bodies have ruled that the more decentralized a project is, especially from launch, the less likely they are to be deemed a security (see: Ethereum). This means they can be traded more freely and be available on more platforms. We are as decentralized as you can be. The data itself is all secured through the blockchain which has been shown to be a highly secure medium. We do not store any of your data and as long as you follow best practices in blockchain security there are no added security risks of using Statera. We don’t, and literally can’t, hold anymore personal information than is made available in any blockchain transaction. and that "personal information" is more likely than not just your ethereum wallet address, no "real world" data is included in transactions
Q2 from: @Michael_NGT353 What is Mechanism you use On your Project sir? Are you Use PoS,PoW or other Mechanism Can you explain why you use it and what is Make it Different?
Our token is an ERC-20 token and it's running on the Ethereum blockchain. The Ethereum's POW mechanism is currently supporting the Statera token We run on Ethereum, so we are currently PoW. With ETH 2.0 we will hopefully be PoS this year (hopefully). We use it because ETH has over 100 million addresses and around a million daily transactions. We are currently at about 1,900 token holders, we are just touching the edge of what is possible in this market. We chose the biggest and the best network available right now to launch our product. We think the upside is huge because of this choice. Being the biggest network it is also one of the most secure, no high risk vulnerabilities have been found in Ethereum or in our code (we've had our code audited by a third party, Hacken, and you can read their audit on our Medium page), so we also have security on our side
Q3 From : @Ryaaan_Nguyen Can you list some of Statera outstanding features for everyone here to know about? What are the products that Statera is focusing on developing?
As mentioned earlier by GC, First off, what we have created is a new asset class, I’ll repeat that, a new asset class. This asset has never existed: “Deflationary Index Fund,” what does that mean for finance? What will developers do with this? It’s hard to give a finite answer. We hope there are future economic papers on our token and what it means to be a deflationary index fund. With the addition of synthetic assets and oracles you can put any asset into the DeFi space: Gold, Nikkei 225, USD, etc. STA can be combined with any assets and bring the benefits of it’s ecosystem and deflationary mechanism to that asset. STA, the token itself, also gives you access to the price action of any asset it is paired with. Put simply STA’s balancer pool(s) give you a benefit in holding them, and STA’s price will reflect it’s inclusion in Balancer Pool(s) (and possibly future financial instruments), so STA is a bet on DeFi as a whole. When we say as whole, we mean as whole: what happens if you include STA in a crypto loan, or package it with a synthetic S&P 500 token, or use it as fee payment in a DeFi platform? We touched on this a bit in the question on what makes us special compared to other exchanges. We have created a product that synergizes with Balancer Pools creating a symbiotic relationship that improves the outcomes for users (our product can also synergize with future DeFi products). By including STA in an index fund with Link, BTC, ETH, and SNX you can buy one token and access the price action of four of the leading cryptocurrencies. You can also invest directly in the index fund (balancer pool) and receive the benefits of fees and BAL tokens paid to you while also having an automatically balanced portfolio (like an index fund with dividends). Lastly, the deflationary mechanics of STA increases the chance for positive price action while decreasing beta. We want to package Statera with assets across the whole cryptocurrency space, with an emphasis on DeFi. We also want everyday people to be able to invest quickly in crypto while also feeling reassured their investment is set up to succeed. We are focused on developing a name brand that people go to first and foremost when investing in crypto: cryptocurrency in every portfolio. This is all found in a smart contract that is fully decentralized, the founders can no longer augment the contract in any way and this has been confirmed by the third party code audit. This is a feature in and of itself, some argue that Bitcoin’s true value is in it’s network effect, first mover advantage, and immutability. Statera is modeled on all three of those and has those features in spades. The community now owns our token, the power in that, giving finance and power to the people, is why we are here.
Q4 From : @futcek What do you think about the possibility of creating new use cases in DeFi space for existing real world assets by using crypto technology? What role do you see in this creation for Statera?
I think my answer above actually answers this perfectly, Statera in and of itself is a “new use case”, a “deflationary index fund” has never existed, I’ll copy and paste the other relevant part: “With the addition of synthetic assets and oracles you can put any asset into the DeFi space: Gold, Nikkei 225, USD, etc. STA can be combined with any assets and bring the benefits of it’s ecosystem and deflationary mechanism to that asset. STA, the token itself, also gives you access to the price action of any asset it is paired with. Put simply STA’s balancer pool(s) give you a benefit in holding them, and STA’s price will reflect it’s inclusion in Balancer Pool(s) (and possibly future financial instruments), so STA is a bet on DeFi as a whole. When we say as whole, we mean as whole: what happens if you include STA in a crypto loan, or package it with a synthetic S&P 500 token, or use it as fee payment in a DeFi platform? Being fully decentralized it is up to our community to make this happen, social engagement and community are key. We are constantly bringing community members onto our team and rewarding those that benefit the ecosystem.” Statera is a way to make your investment more successful, and owning Statera let's you benefit from other people using it to make their investments more successful (a self feeding cycle).
Q5 From : @Carmenzamorag Statera's deflationary system is based in that with every transaction 1% of the amount is destroyed, would this lead to lack of supply and liquidity in the long term future? How would that be fixed?
The curve of supply is asymptote, meaning that it will never reach zero. The idea is that the deflationary process will slowly decrease the supply of STA, which – combined with a fixed or increaseing demand – will result in STA appreciating in value. Evidently, as the STA token increases in value, the amounts of STA being traded will slowly decrease: The typical investor might buy 10.000 STA at the current rate, but in the future (proportional to an increase in the valueation of STA) this number will tend to decrease, hence the future investor might only buy 1000 STA. This of course results in less STA being burned. Additionally, STA is divisible to the 18th decimal, why – even if the supply was to reach 1 STA – there would be a sufficient supply. Well this would be a question for a Mathematician, and luckily we’re loaded with them (as seen above)! I’ll try to illustrate with an example. 1% of 100 million is 1 million, 1% of 10 million is 100,000. As we go down in supply the burn is less by volume. What also happens at lower supply is higher prices (supply and demand economics). So those 1 million tokens burned may be worth $20,000, but by the time overall supply is at 10 million those 100,000 tokens may also be worth $20,000 or even more. This means you transact “less”, if you want to buy 1 Ether now with Statera you need 8,900 STA which would burn 89 tokens. If Statera is worth $100 you only need 2.32 statera (.023 tokens burned). Along with this proportional and relative burn decrease, tokens are 18 decimals long, so even when we get to 1 token left (which mathematically would take decades if not centuries, but that is wholly dependent on usage), you are still left with 10 to the 18th power, or one quintillion “tokens”. So it’s going to take us a while to have supply issues :)
Nuked Phase (3rd Part)
Q) What is your VISION and Mission?
Our working mission and vision: Mission: Provide every investor with simple and effective ways to invest in cryptocurrency. Decrease volatility and increase positive price pressure in cryptocurrency investments. Lower the barrier to entry for more advanced investment tools. Be a community focused and community driven cryptocurrency, fully decentralized by every meaning of the word. Vision: We aspire to put “cryptocurrency in every portfolio”. We envision a world where finance is given back to the people and wealth building strategies withheld only for affluent individuals are given to all. We also strive to create an investment environment based on sound monetary policy and all the power that comes with a sound asset.
Q) What are the benefits of STA for its investors in long term? Does STA have Afrika as an important area for its expansion?
We have ties to Africa and see Statera as a way for anyone and everyone to invest in cryptocurrency. The small marketcap of statera makes it's price low and it's upside massive. Right now if you wanted to be exposed to the price action of four cryptocurrencies (BTC, ETH, Link, SNX) Statera is a way to gain that exposure in a way that has a huge upside, compared to the other four assets, there are risks in investing in any small cap but with those risk come outsized rewards (not investment advice and all answers are solely my opinions 😊)
Q) In the long run, why should we trust and follow STATERA? How do you raise awareness and elimination of the doubts of investors / partners / customers?.
You're really asking "How do I trust myself and other crypto investors" The project is FULLY decentralized, it is now in the hands of the community. We would venture a guess that the community wants their investment to succeed and be worth more in the future, so you are betting on people. wanting to make themselves money on their own investment. This is a pretty sure bet. The community being active and engaged is key, and we have short term and long term plans to ensure this happens
Q) No one can doubt the strength of #Statera. But can you tell us some of the challenges and difficulties you're presently facing? How can you possibly overcome them?
We're swinging outside our weightclass, we don't see litecoin or SNX, or any other crypto product as our competition. Our competition is NASDAQ, Fidelity, etc. We want to provide world class financial instruments that only the wealthy have access to in the traditional world to everyone. Providing liquidity, risk parity, being paid to provide liquidity, unique value propositions, are all things we want to bring to everyone. However we are coming up in a hectic space, everyday their is fud and defamation on the web, but that is the sandbox we chose to play in and we aren't grabbing our ball and going home. We can tell you that we will not disappoint and fighting all the fud that comes along with being a small and upstart project only fuel our fire. Building legitimacy is our largest challenge and looking at our audit, financial report, and some things you will see in the coming weeks, we hope you see we are facing those challenges head on.
Q) What is the actual uniqueness of #Statera.??? Can you guys please explain tha advantages of #Statera over other projects.??
When we launched there were no other products like ours. There are now copies, and we wish them the best, but we have the best product, hands down. Over the next couple weeks this will become apparent, if it hasn't already, also a lot of the AMA answers dug deeper into our unique value proposition, especially the benefits we provide to Balancer Pools which shows the benefits we would provide for any index fund. We are a tool to improve cryptocurrency investing
Q) Fragmentation, layering and cross-chain are three future solutions for high-performance blockchains. Where is Statera currently? What are the main reasons for taking this direction?
We operate on the Ethereum chain, as it upgrades our services and usability will upgrade. We are working on UI and more user friendly systems to onboard people into our ecosystem
Q) How STATERA plan to make room and make this project known in the world of crypto, full of technology and full of new projects very good in today's market?
We think we have a truly innovative product, which - when first understood - appeals to most investors. Whether you want a high-volatility/medium-risk token like STA or whether you are more conservative and simply just plan on adding to the Statera pool BPT (which is not nearly as volatile but still offers great returns). We plan on making Statera known to the crypto world through a marketing campaign which slowly will be unravelled in the comming days and weeks. If interested, you can check out an analysis of the different investment options in the Statera ecosystem in our first financial report: https://medium.com/@stateraproject/statera-financial-reports-b47defb58a18
Q) Hello, cryptocurrencies are very volatile and follow bitcoin ... and does this apply to Statera? or is there some other logic present in some way? is statera token different from a current token? Are you working on listings on other exchanges?
Currently uniswap is somewhat uncomfortable for fees. We are also on bamboo relay, saturn network, and mesa. Statera will be volatile like all cryptocurrency, this is a small and nascent space. But with the deflationary mechanic and balancer pool, over time, as marketcap grows it will become less volatile and more positively reactive to price.
Q) Security is one of the most essential characteristics for a project to get reputation. How can #Statera Team assure to their community that users assets and investments will stay safe from unwanted agents?
We have been third party audited by the same company that worked with VeChain to audit their code. Our code has been shown to be bulletproof. Unless Ethereum comes up with a fatal security flaw there is nothing that can happen to our contract (there is no backdoor, no way for anyone to edit or adjust the smart contract).
Q) Many investors see the project from the price of the coin. Can you give us advantages why Statera is so suitable for long-term investment? and what makes Statera different from other similar projects?
Sometimes the simplest solutions are the most effective. A question you can ask is “What if this fails”? But you can also ask, “What if this succeeds”? Cryptocurrency is filled with asymmetric risks, we think if you look into the value proposition you will find that there is a huge asymmetric risk/reward in Statera, and we will make that even clearer in our soon to be released litepaper. You are on the ground floor of a simple but highly effective solution to onboarding people into defi, cryptocurrencies, and investing. Our product reduces volatility and increases gains (decreases beta and increases alpha in investor terms), which is highly attractive in any investment. The down side is there but the upside outweighs it exponentially (asymmetric risk)
Q) What your plans in place for global expansion, are Statera focusing on only market at this time? Or focus on building and developing or getting customers and users, or partnerships? Can you explain this?
We have reached out to influencers in other countries and things are in the works. We have also translated documents and are working on having them in at least 4 languages by the end of July. We were founded globally, our team is global, and we are focused on reaching all 7 billion people.
Q) Now in the cryptofield everyday there are new projects joining in the Blockchain space. They are upgraded, Well-established and coming up with innovative technology. How Statera going to compete with them? What do you think, one day Statera will become useless And will be lost into the abyss of time for not bringing any new technology?
We are the first of our kind, no one had a deflationary index fund before us. Index funds will be the future of crypto (look at the popularity of etfs and indexes in the traditional markets). We are a tool to make your index function better and pay you more. As long as people care about crypto index funds they will care about the value STA brings to that. We have an involved and long term plan to reach dominance over a 5 year span, this is not a flash in the pan, big things coming
Q1. You say that the weight and proportions of your tokens are constant. So how have you managed to prevent market price speculation from generating hypervolability in your token price? Do you consider yourselves a kind of stablecoin? Q2. How many jurisdictions allow the use of Stratera products and services? Are they available for Latin America? @joloroeowo The balancer ensures an equal ratio of 20% amongst the five tokens included in our fund. This, however, does not imply that the tokens are stable. Rather, the Balancer protocol helps mitigating price fluctuations.
Q) How can I as a Statera participant participate in liquidity mining, and receive BAL as reward? What are the use cases of $STA token, and how are users motivated to buy and hold long term?
The easiest way is to go to stateratoken.com and click trade then BPT. You can also buy all five tokens and click on portfolio then add liquidity. Balancer is working on a simpler interface to add liquidity with one token, we are waiting on them. I think we explained the use cases above
Q) What do you plan have for global expansion, is Statera currently focused solely on the market? Or is it focused on building and developing or acquiring customer and user or partnership relationships? Can you explain it?
We are currently working on promoting the project and further develope our product, making it lucrative for more new investors to join our pool and invest in the STA token.
Q1) Statera have 2 types of tokens, so can you tell me the differences between STA and STAC ? What are their uses cases? Is possible Swap between them? Q2) Currently the only possible Swap or "exchange" possible is Uniswap, so you do have plans to list the STA token into a more Exchanges?
STAC is obsolete, we only have STA and BPT (go to our website and click on trade) stateratoken.com BPT gives you more diversification and less risk, STA gives you more volatility and more chance for big gains. Q2 we are on multiple exchanges (4), bamboo relay, saturn, and mesa we do have plans for future exchanges but the big ones have processes and hoops to jump through that can't be done so quickly
Q) What business scenarios can STATERA support now? In which industries can we see the mass adoption of STATERA technology in the near future?
Statera increases the effectiveness of your cryptocurrency investments. Specifically it makes cryptocurrency index funds function better, netting you higher returns, which we have already seen in just one month of implementation. Right now, today, you can buy our BPT token and increase the functionality of holding a crypto index fund. In the future we want every single web user to see and use our product
Q) Do you plan to migrate to other platforms like Tron, BinanceChain, EOS, etc. if it is feasible??
Migrating our current contract is not. Starting new offerings on those other chains could be possible, they aren't on our radar currently but if the community requests them we are driven by our community
Q) ETH Blockchain is a Blockchain have many token based in it, i have used ETH blockchain long time and i see it have big fee and need much time to make a transcation so Why you choose to based STA in ETH blockchain not other like Bep2 or Trc20 ?
Simply: 100 million addresses, 1 million transactions a day. The more users we have the more we will benefit our community. We hope ETH 2.0 scaling will fix the problems you mention.
Q) No one achieve anything of value on its own, please can you share about Statera present and future partnerships that will drive you to success in this highly congested crypto space?
We have a unique product that no one else has (there are people who have copied us). We can't announce our current and future partnerships yet, but they will be released soon. Our future hopes of partnerships are big and will be key to our future, know we are focused on making big partnerships, some you may not even be thinking about.
Q) According to the fact that your algorithm causes 1% of each transaction to be destroyed, I would like to know, then, how you plan to finance yourself as a project in the long term?
The project is now in the hands of the community and we are a team of passionate people volunteering to help promote and develope the Statera ecosystem. But then, how do we afford running a promo campaign? We have lots of great community members donating funds that goes to promoting the project. In other words, the community helps financing the project. And so far, we have created a fantastic community consisting of passionate and well-educated people!
Q) There are many cryptocurrency startups were established by talent teams, but they got problem in raising capital via token sales due to many factors as bear market, bankrupt etc. This leaded their potential startups fail. So how will Statera break these barriers and attract more funds from outside crypto space?
We are community focused and community ran. When you look at centralized cryptocurrencies you can see the negative of them (Tron, ADA, etc.) We believe being fully decentralized is the true power position. You the owner of statera can affect our future and must affect our future. This direct ownership means people need to mobilize and organize to push us forward, and it is in their best self interest to do so. It's a bet on our community, we're excited about that bet
Q) What business scenarios can STATERA support now? In which industries can we see the mass adoption of STATERA technology in the near future?
Statera increases the effectiveness of your cryptocurrency investments. Specifically it makes cryptocurrency index funds function better, netting you higher returns, which we have already seen in just one month of implementation. Right now, today, you can buy our BPT token and increase the functionality of holding a crypto index fund. In the future we want every single web user to see and use our product
Q) Why being a hybrid of a liquidity pool and an index fund? What are the main benefits about this?
By being a liquidity pool the exchange side of the pool (balancer also functions as an exchange) gives you added liquidity for more effortless, effective, and cheaper rebalancing. You also benefit from getting paid the fee when people use the exchange AND getting paid BAL tokens that are worth $15-20 USD. These are not benefits you get with an index fund, meanwhile the liquidity pool rebalances just like an index fund would
Q) Which specific about technology and strategy of #STA that make you believe it will be successful and what does #STA plan do to attract more users in the upcoming time?
I think the idea behind Statera is truly ingenious. We have made an index fund, which investors are highly(!) incentivised to invest in, namely because the ROI, so far, has been huge. An increase in the pool liquidity (index fund) indirectly translates into an increase in the price of STA, why we think the STA token - combined with its deflationary nature - will increase in the long run. The mechanism behind this is somewhat complex, but to better get an understanding of it, I suggest you visit our medium page and read more about the project: https://medium.com/@stateraproject
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All About BitShares [BTS]

All About BitShares [BTS]
source: https://medium.com/@AtomarsExchange/all-about-bitshares-bts-4ba242ec018b

What is Bitshares?

Bitshares is a decentralized cryptocurrency exchange that forms part of the Microsoft Azure blockchain. It was created in 2014 as a brainchild of CTO Dan Larimer, who is also the co-founder of Steem and EOS, along with Charles Hoskinson, co-founder of Ethereum and Cardano. Just like Steem, Bitshares uses a Graphene layer and is part of the most active blockchains on the market.

https://preview.redd.it/24w3wvs7cnx31.png?width=1538&format=png&auto=webp&s=bebcd1ac216a4309b658d99b33a019fb4b81b1af

Introduction to Bitshares (BTS)

Bitshares has gone ahead to the forefront of the battle to regulate cryptocurrencies. The Securities and Exchange Commission has been reviewing Ethereum and Bitcoin to determine what differentiates a crypto token acting as a security. Many crypto exchanges are in a mad rush to submit the proper forms to get SEC approval and some are pulling out of the U.S market completely.
The subject of cryptocurrencies as a security, commodity or currency is being debated for many of the top 100 cryptos. In the U.S., regulators like SEC and DOJ are being careful to research and classify cryptos, blockchains, ICOs and exchanges on an individual basis.
Enter Dan Larimer, with a clear vision of building towards a massive section of the decentralized exchange market. Legal issues would prove to be nothing if the cryptocurrency exchange is competitive. Bitshares is based on a delegated Proof-of-Stake verification system and the blockchain technology of the network is revolutionary.

Benefits of Bitshares

Transaction speed: Bitshares’ blockchain offers transaction speeds of less than 5 seconds to conclude.
Decentralization: The Bitshares exchange is fully decentralized which ensures users are protected. Hacking is impossible and the cryptocurrency is seen as highly reliable.
Minimum commission: Bitshares offers special solutions that make transactions in the system very fast and cheap. One of the main goals in the development of the BTS cryptocurrency was to reduce transaction fees.
Real value: Bitshares is not like other cryptocurrencies that are not backed by anything. Bitshares comes with the benefits of the trading platform as well as its services. Thus, predicting the value of assets is much easier than for example, Bitcoin.
Increased throughput of the system: The trading platform’s technical capabilities allow for more than 10,500 transactions per second. Bitcoin, on the other hand, can conduct no more than 7 financial transactions per second.


https://preview.redd.it/ad4s8l7bcnx31.png?width=1080&format=png&auto=webp&s=1c77f313c78114aca4fd0a6f5cbb36a0fa88b00e

Breakdown of BTS

The total supply of Bitshares is 3,600,570,502 BTS with the price peaking on January 2, 2018, at $0.907259. BTS cannot be mined. It is regarded as a legacy coin because it existed long before most exchanges and is responsible for the concept of crypto trading pair. Bitshares is the first delegated Proof of Stake blockchain and is governed by community-elected delegates.
Bitshares runs a referral rewards program to drive mass adoption. At the moment, opening a Bitshares account is free, but a lifetime members account costs $100 and comes with 80% fee discounts. Also, lifetime members earn $80 for referring another Lifetime member.
BTS coins cannot be mined. Tokens can be created on the Bitshares network and can be converted to BTS, then converted to BitAssets, which are tied to real-world markets.
bitUSD, bitEUR, and bitCNY are based on real-world fiat currencies, U.S. Dollar, Euro, and Yuan, respectively. Meanwhile, bitGOLD and bitSILVER are based on gold and silver prices.
People in volatile markets such as South America where hyperinflation is rife will enjoy the stability this crypto option provides at a time local fiat currency is struggling.

What is BitAsset?

Online exchanges are centralized and databases are stored on servers only the exchange can control. To use their services, you must first create verified accounts which often involves scanning an ID. Bitcoin and altcoins are still relatively new and this is why they suffer wild swings from time to time. This essentially necessitates converting crypto coins into a stable asset, usually USD. This need is served by exchanges as they allow users to buy and sell crypto coins by converting to and from fiat currencies like USD, EUR, YUAN, and so on.
Bishares’ answer to this is BitAsset. A BitAsset is a coin pegged to a real-world asset. Its value is a mirror of the value of the real-world’s asset. For instance, the BitAsset BitUSD mirrors the value of USD. This means BTS can be converted into BitUSD, and BitUSD to BTS without exiting the blockchain.

How to Buy and Store BitShares (BTS)

BTS can be bought and sold on several crypto exchanges which include Binance, HitBTC, Huobi, OpenLedger, CoinEgg, and Poloniex. However, the coin is not offered by many. Most of the active work is done on lesser-known sites. One in particular is zb.com, which executes transactions in the BTS/ZB pair reaching over $600,000 in total. Still, on the same platform, the BTS/USDT pair is traded for only $300,000 in total. More than $5 million BTS is traded every day in trading pairs with BTC, ETH, and USDT. Bitshares can be stored through the official Bitshares wallet.

Difference Between BitShares and Other Cryptocurrencies

The key difference Bitshares has with other cryptocurrencies is that it is based on Delegated Proof of Stake. Other systems utilize confirmation of financial transactions involving miners. However, rather than pay millions to people for this, the BTS team thought differently. Special delegates are called on to confirm financial transactions. These delegates are selected by the holders of the coin. In theory, anyone with a Bitshares account can become a delegate. There are currently 101 delegates in total.
Each delegate can sign at most 1% of transactions. For Bitcoin, most financial transactions are confirmed by 4–5 major users. If you aren’t satisfied with your delegate, you can refuse his services and choose another delegate.

Conclusion

Crypto investment can be really profitable, but with profit comes danger. In financial services, transparency is the watch-word, and while the other cryptos aim to redefine banking, BTS is focused on Wall Street. It remains to be seen whether it is a kill shot or they will both learn to live together.
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Daily analysis of cryptocurrencies 20191004(Market index 30 — Fear state)

Daily analysis of cryptocurrencies 20191004(Market index 30 — Fear state)

https://preview.redd.it/1a9tl97fjjq31.png?width=1187&format=png&auto=webp&s=764fe29b4b1aecdab2facadb18eb5838cce17a4d

Vitalik Buterin: Ethereum 2.0 Public Testnet Soon To Be Launched Ethereum founder Vitalik Buterin said in an interview that over the past few months, much progress has been made in the Ethereum ecosystem, such as zero-knowledge proofs. The development of Ethereum 2.0 has also made very rapid progress, and the Ethereum 2.0 public testnet will also be launched soon. Also, Vitalic Buterin revealed that seven client development teams of Ethereum 2.0 met in Toronto in early September, and they realized the interaction and interoperability among these seven clients. Currently, Casper FFG, the primary work relating to Ethereum 2.0, will soon be available.
‘Gold-Backed’ Crypto Token’s Promoter Investigated By Florida Regulators Florida regulators are investigating Karatbars, a German company that’s been promoting a token tied to a Miami “crypto bank” without any banking license in the state. Karatbars previously issued a cryptocurrency purportedly backed by gold, but CoinDesk has been unable to verify the existence of the mine the company says produced the gold. Before it entered the crypto space, Karatbars sold gold products online through an affiliate marketing system that regulators in three countries warned the public to avoid. CoinDesk interviewed three of Karatbars’ current “affiliates,” who said they passionately believe in the company and its tokens.
Nomura Completes Investment In LVC In Accordance With Blockchain-Focused Alliance Agreement LINE Corporation, LINE’s group company LVC Corporation, and Nomura Holdings Inc today (Oct 4) announce they have entered into a final agreement to form a financial business partnership that focuses on blockchain technology. The agreement follows the signing of a memorandum of understanding by the companies in January 2019. In accordance with the partnership terms, Nomura has completed its investment in LVC today. In this long-term partnership, the three stakeholders aim to collaborate in order to build a new financial service using blockchain technology.
Hong Kong SFC Released Regulatory Terms On Licensed Virtual Asset Management Firms The Securities and Futures Commission (SFC) of Hong Kong released the proforma set of terms and conditions on licensed virtual asset management companies on its official website. SFC indicated that the released terms and conditions will apply to fund managers of virtual assets, including those who plan to invest in virtual assets, or intend to cover 10% or more of the gross asset value of the portfolio to invest in virtual assets.

Encrypted project calendar(October 04, 2019)

KNC/Kyber Network: Kyber Network (KNC) will update the maxGasPrice parameter in the Kyber Network contract from 100 gwei to 50 gwei within 2 weeks after October 4.

Encrypted project calendar(October 05, 2019)

Ontology (ONT): Ony Ji will attend the blockchain event in Japan on October 5th and explain the practical application based on the ontology network. BNB/Binance Coin: The Binance Coin (BNB) Oasis Game Hackathon will be held on October 5th in Bangalore, India, and will be hosted by Binance Labs, Matic Network, Cocos-BCX, Celer Network, Marlin Protocol.

Encrypted project calendar(October 06, 2019)

SPND/ Spendcoin: Spendcoin (SPND) will be online on October 6th

Encrypted project calendar(October 07, 2019)

GNO/Gnosis: Gnosis (GNO) will discuss the topic “Decentralized Trading Agreement Based on Ethereum” will be held in Osaka, Japan on October 7th. Kyber and Uniswap, Gnosis and Loopring will attend and give speeches.

Encrypted project calendar(October 08, 2019)

BTC/Bitcoin: The 2nd Global Digital Mining Summit will be held in Frankfurt, Germany from October 8th to 10th.

Encrypted project calendar(October 09, 2019)

CENNZ/Centrality: Centrality (CENNZ) will meet in InsurTechNZ Connect — Insurance and Blockchain on October 9th in Auckland.

Encrypted project calendar(October 10, 2019)

INB/Insight Chain: The Insight Chain (INB) INB public blockchain main network will be launched on October 10. VET/Vechain: VeChain (VET) will attend the BLOCKWALKS Blockchain Europe Conference on October 10. CAPP/Cappasity: Cappasity (CAPP) Cappasity will be present at the Osaka Global Innovation Forum in Osaka (October 10–11).

Encrypted project calendar(October 11, 2019)

OKB/OKB: OKB (OKB) OKEx series of talks will be held in Istanbul on October 11th to discuss “the rise of the Turkish blockchain.”

Encrypted project calendar(October 12, 2019)

BTC/Bitcoin: The 2019 Global Mining Leaders Summit will be held in Chengdu, China from October 12th to 14th.

Encrypted project calendar(October 14, 2019)

BCH/Bitcoin Cash: The ChainPoint 19 conference will be held in Armenia from October 14th to 15th.

Encrypted project calendar(October 15, 2019)

RUFF/RUFF Token: Ruff will end the three-month early bird program on October 15th KAT/Kambria: Kambria (KAT) exchanges ERC20 KAT for a 10% bonus on BEP2 KAT-7BB, and the token exchange reward will end on October 15. BTC/Bitcoin: The Blockchain Technology Investment Summit (CIS) will be held in Los Angeles from October 15th to 16th.

Encrypted project calendar(October 16, 2019)

BTC/Bitcoin: The 2019 Blockchain Life Summit will be held in Moscow, Russia from October 16th to 17th. MIOTA/IOTA: IOTA (MIOTA) IOTA will host a community event on the theme of “Technology Problem Solving and Testing IoT Devices” at the University of Southern California in Los Angeles on October 16. ETH/Ethereum: Ethereum launches Istanbul (Istanbul) main network upgrade, this main network upgrade involves 6 code upgrades. QTUM/Qtum: Qtum (QTUM) Qtum main network hard fork is scheduled for October 16.

Encrypted project calendar(October 18, 2019)

BTC/Bitcoin: The SEC will give a pass on the VanEck/SolidX ETF on October 18th and make a final decision HB/HeartBout: HeartBout (HB) will officially release the Android version of the HeartBout app on October 18.

Encrypted project calendar(October 19, 2019)

PI/PCHAIN Network: The PCHAIN (PI) backbone (Phase 5, 82 nodes, 164, 023, 802 $ PI, 7 candidates) will begin on October 19. LINK/ChainLink: Diffusion 2019 will be held in Berlin, Germany from October 19th to 20th

Encrypted project calendar(October 21, 2019)

KNC/Kyber Network: The official online hackathon of the Kyber Network (KNC) project will end on October 21st, with more than $42,000 in prize money.

Encrypted project calendar(October 22, 2019)

ZRX/0x: The 0x protocol (ZRX) Pantera blockchain summit will be held on October 22.

Encrypted project calendar(October 23, 2019)

MIOTA/IOTA: IOTA (MIOTA) IOTA will host a community event on October 23rd at the University of Southern California in Los Angeles with the theme “Connecting the I3 Market and Experiencing Purchase and Sales Data.” BTC/Bitcoin: The WBS World Blockchain Summit (Middle East) will be held in Dubai from October 23rd to 24th.

Encrypted project calendar(October 24, 2019)

BCN/Bytecoin: Bytecoin (BCN) released the hidden amount of the Bytecoin block network on October 24.

Encrypted project calendar(October 25, 2019)

ADA/Cardano: Cardano (ADA) The Ada community will host a community gathering in the Dominican Republic for the first time on October 25.

In the past two sessions, there were bearish moves in bitcoin below $8,300 against the US Dollar. The BTC/USD pair followed a bearish path and broke the $8,200 support area. Moreover, there was a close below the $8,200 level and the 100 hourly simple moving average. The last swing high was formed near $8,300 before the price broke $8,200 support.
Additionally, there was a break below the 50% Fib retracement level of the upward move from the $7,659 low to $8,539 high. The recent decline was such that the price tested the $8,000 support area. More importantly, the price tested the 61.8% Fib retracement level of the upward move from the $7,659 low to $8,539 high. At the moment, the price is struggling to hold the $8,000 support area.
It seems like there is a key declining channel forming with resistance near the $8,260 level on the hourly chart of the BTC/USD pair. Thus, if there is a downside break below the $8,000 support, the price could accelerate its decline towards the $7,800 support area. Besides, an intermediate support is near $7,850 or the 76.4% Fib retracement level of the upward move from the $7,659 low to $8,539 high.
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Wealth Formula Episode 175: Cryptocurrency and Asymmetric Risk with Teeka Tiwari

Wealth Formula Episode 175: Cryptocurrency and Asymmetric Risk with Teeka Tiwari

Catch the full episode: https://www.wealthformula.com/podcast/175-cryptocurrency-and-asymmetric-risk-with-teeka-tiwari/
Buck: Welcome back to the show everyone. Today my guest on Wealth Formula Podcast is no stranger to the show. He’s a guy who grew up in foster care and came over the US at the age of 16 with just 150 bucks in his pocket and the clothes on his back. And then by the age of 18 becomes the youngest employee at Lehman Brothers. By 20 he becomes the youngest vice president in Lehman history. Later in his career he goes on to launch successful hedge fund and lived the Wall Street dream. I mean he’s known on Wall Street as the guy who’s made a fortune on what is known as asymmetric risk which is what we’re going to talk about in quite a bit and for the rest of us, for many of us that is, he is best known for being the editor of the Palm Beach confidential newsletter which focuses on digital currencies and I am a subscriber to this by the way. Teeka, welcome back to Wealth Formula Podcast, Teeka Tiwari.
Teeka: Thanks Buck. It’s a pleasure to be here and thank you for having me.
Buck: Yeah so you know you were on not too long ago and some people are listening to the stuff about cannabis and they’re probably thinking to themselves, why is this guy talking about cannabis and digital currencies like what is his specialty? In fact the way I’m thinking about this there’s one main thing that they have in common, they’re both in this area that you call and we call asymmetric risk which is really your thing. Discuss what that means and if you would how have you applied it to your own growth and ultimately to your own wealth.
Teeka: So before I get into asymmetric risk I want to talk about how I discovered asymmetric risk and how I changed the way that I yeah. So when I was in my 20s I developed a lot of wealth by taking massive risk in the stock options and commodities market. And I would bet huge positions. And then that all came to an end in the late 90s when I was on the wrong side of a series of trades that were triggered by the Asian financial crisis which ultimately compelled me to file for bankruptcy. And so I had lost about ten years of wealth creation which was considerable at the time. And what I learned was that I had to change my approach that I couldn’t get it all every single time otherwise I would never get off this boom-and-bust merry-go-round. So what I realized was is that I would I would build the portfolio of somewhat safer more income oriented investments and then I would focus on these ideas that are called asymmetric risk trade. So what’s an asymmetric risk trade? An asymmetric risk trade is where you can take a relatively trivial sum of money and if the idea doesn’t work out it doesn’t impact your net your net worth or your day-to-day lifestyle in any way shape or form. But the asymmetric part of it is is that if it does work out it can absolutely move the needle on your net worth. So an example of that would be something like neo which I recommended at around 12 cents that ended up going up to about a hundred and sixty one dollars so that’s something that you could have put a thousand dollars in and turn it into over a million dollars. That’s a classic asymmetric trade. So what I what I tell my readers is you can’t build your whole portfolio around high-risk asymmetric trades. But if you take let’s say five to ten percent of your liquid net worth and allocate it to these types of situations in a and one of the things I talk about is using uniform position sizing, what you put yourself in the position to do is absolutely grow your network sometimes three four five six X without putting your current lifestyle at risk and it is a sweet spot of wealth creation that I’ve created and popularized now for several years that has not only transformed my financial life but the financial life of many of my readers.
Buck: So as you know Teeka my group the Wealth Formula Group in general I mean there’s a lot of people who are well-to-do they’re you know accredited investors they have you know typically probably more money to invest than others they’re you know and I say this because there is a little bit of a difference there when it comes to somebody who’s barely getting by living check to check, that there is an opportunity in your portfolio to say okay what percentage of this portfolio could I put in that I mean listen if I lose it no big deal I mean I won’t be happy about it but it won’t hurt me that much on the other hand this could explode. Now when you look at it from the perspective of somebody who’s got a fair amount of money and link who’s investing you know several hundred thousand dollars a year or maybe a million dollars or something like that like what do you think is a reasonable amount of a portfolio? Like I know for example that even universities are getting into this and they’re looking at hey maybe you know 1/2 of 1% or something like that I mean I know you’re not in the business of giving financial advice but I’m just curious kind of what your approach would be in terms of allocation.
Teeka: So again generally speaking I would say 5 to 10% of your liquid net worth. So let’s say you’ve got a business that kicks out a million a year that you have to allocate for your investment 50 to $100,000. Definitely nobody likes to lose 50 or a hundred thousand dollars but it’s not going to have a material impact on your lifestyle but if you invest 50 to $100,000 and these asymmetric bets pay off you’re talking about five six seven eight ten twelve million dollars in returns on what is a relatively tiny investment relative to your net worth and that is the beauty of this approach.
Buck: Yeah and and I’m glad you said that because that’s exactly kind of where I’m at sort of lingering between five and ten percent you know and for me you know I I kind of put this in there about you know I kind of put this in that area with startups right I’m not gonna I’m not gonna have a separate category just for digital currencies but anything that is super high risk and high reward and I’m sitting about five or ten percent.
Teeka: That all goes into the same bucket so that’s right that for everybody it’s not just oh this is crypto currencies five to ten percent and startups is five to ten percent. No all go into the same bucket is asymmetric risk.
Buck: Yeah now okay so we kind of got ahead of ourselves and you know you haven’t been on the show talking about crypto currency in a fair amount of time we have a lot more new listeners now so for those who know very little about cryptocurrency but they’re smart they’re sophisticated say they’re a group of you know I know worth investors you’re talking to you they’ve not heard about this how do you explain this in the most efficient way possible and what the significance of it is?
Teeka: Okay so that’s a really big question.
Buck: Yeah no I don’t but I bet you’ve answered it a few times.
Teeka: I’m gonna take a shot at it. So listen as a wealthy investor myself why would I want to bother with cryptocurrency? I’m already rich why do I want to mess around with this? So I’m gonna answer it from that perspective. One it’s always nice to make more money. But two the bigger reason is, is what I want people to understand especially wealthy investors is that it’s very rare to invest at the beginning of a brand-new asset class very very rare right it’s brand-new asset classes though just don’t come about. Digital currency is a brand-new asset class that has legs. So why does it have legs? It has legs because we have never had an asset class that is completely non correlated with the business cycle. It’s never existed before. Every asset class in the world is somehow tied to the business cycle gold, industrial, metals, currencies, stocks, bonds, they’re all tied to the business cycle in one way shape or form things like Bitcoin are not so why why does that make it valuable it makes it valuable because if you are pension fund you’re allocating capital across traditional and non-traditional assets you still have this problem of deep correlation right the business cycle falls apart and you’re taking hits across the board. So there have been studies that have shown just with a small allocation of Bitcoin anywhere from one to five percent across the portfolio even though Bitcoin is wildly volatile because it is not correlated and not tied to the business cycle it actually reduces your overall volatility and your overall risk in your portfolio and that is incredibly valuable. So just from a high level portfolio construction standpoint you will see the world’s hedge funds, pension funds, massive allocators of capital start to move tiny slivers of their money into things like Bitcoin and we’re talking tiny slivers of an 80 trillion dollar pie right it’s in real terms its enormous money in relative terms relative to what they have under management it’s a small amount but when you’re coming off a base where the whole markets only worth 300 billion it doesn’t take much to move the market. So that’s from the high level that’s why you must have some cryptocurrency. And then the next level beyond that is that mankind has never had an asset there’s never been an asset we’re a stronger man couldn’t take it from a weaker man. So whether it was the caveman knocking one guy over the head for his shells or the government coming in in Venezuela and confiscating money or the Argentinian government saying oh we’re having a holiday and taking all your assets from the bank something Brazil has done on multiple occasions. You know the everyday person has not had this ability to hold an asset that has been beyond the confiscationability of a government so something like Bitcoin and digital currency if you are smart and how you buy it if you don’t talk about it you buy quietly and you store it appropriately it is absolutely impossible short of somebody putting a literally putting a gun next to your head for them to take that asset from you and that is remarkable because even if you’ve got a million dollars in gold and you somehow manage to hide it how are you gonna travel the world with a million dollars in gold how are you gonna spend a million dollars in gold you just gonna go to the store and break a piece off with a piece of pliers you just can’t do that the beauty of digital currency is you can walk around with a thumb drive that big with a billion dollars in it and nobody knows and let’s say hey oh I don’t want to keep a billion in Bitcoin I want to do it in a stable coin fine put it in a stable coin. But this idea this portability of money and this complete ownership of an asset that nobody else has any ability to take from you that is valuable that is incredibly valuable.
Buck: So let me ask you a what may seem like a very basic simple question but I think it’s worth asking. So why is it so volatile why is Bitcoin Ethereum for example why these are the major the two biggest by market cap why are they so volatile and you know to the extent that they are uncorrelated do you see that as a function of the size of the market cap or is it something else inherent about digital currencies that makes it this volatile?
Teeka: I think it’s both. One they’re relatively small so if for instance if you look at Microsoft in its early days it was a crazy volatile stock up 40% down 40% down 30% going through bear markets that lasted two years wrecking billions of dollars in value you look at the early days of Microsoft from the 80s into the mid 90s the stock was all over the place and then as the stock got bigger and more mature of course volatility tamp down so you will see that. So what I say with volatility is that welcomed that volatility without it the opportunity to make enormous amounts of money off a small amount of money won’t exist. At some point Bitcoin and the theorem will move to this more blue chip status where maybe you make eight percent a year or six percent a year or something or something like that thank goodness we’re not there yet. The other side of it is is that there you know the markets that are built around trading these are completely unregulated. They’re wild. And there’s all types of crazy manipulation that goes on in the market you have some Bitcoin whale let’s sell a thousand coins and scare the market down and then let’s go buy back 2000 coins it’s the Wild West and somebody a skeptic might say well why do I want to buy now why don’t I buy when the market calms down because when you buy when the market calms down and it’s moved to this very highly regulated very low volatility asset it could have ten x between now and then. So yes there is volatility but I believe if you position size rationally you will be well rewarded for that moment for that volatility and that uncertainty.
Buck: So admittedly I was skeptical of cryptocurrency early on and you know I finally did get in and my timing was actually really good it was a fall early fall 2017 right before a massive bull run. And that of course was followed by what has been called crypto winter. So the question is, is winter over because it sure seems like it’s an awful long thawing period I mean no we seem like to have gotten there but there’s a stall is it over or do you still see some you know rocky shores ahead before there’s a you know big move potentially to all-time highs?
Teeka: Well no crypto winter was over in April. I put out a report talking about that and I pinpointed when that happened it happened when Bitcoin broke its downtrend line. So if you go back and if you look at each of the so-called crypto winters or horrible bear markets that have been in the space Bitcoin will always lead the market first always and then the altcoins play catch up right so it feels worse than it is right now because the alt coins got crushed and many of them have stayed crushed they haven’t come back that’s probably the most popular question I get take okay bitcoins up and it’s you know been up as much as 400 percent this year but why aren’t the old coins moving and my answer is because it’s not yet time. If you look back at the data generally there is at least a six-month time lag between the time Bitcoin breaks its downtrend line and the time that the alt coins move higher. So that that next stage we’ll be entering to in about October and you’ll see a percolation in the alt coins and they’ll start playing catch-up.
Buck: Does that also correlate Teeka with Bitcoin like an all-time high for Bitcoin though? I mean I mean obviously Bitcoin has recovered substantially we’re like you know three four hundred percent up from you know where we were when Bitcoin was at you know three thousand. The question I have is and I have not looked at this history closely even though there’s this recovery, do you have to start approaching all-time highs for those alts to really make their move is that what you’ve seen historically?
Teeka: No you look back when they all started playing catch up in 2016 Bitcoin was starting to move higher and then going into 2017 and then the alts really didn’t start kicking in until around May and that’s when they started moving and eventually the alts outpaced the type of action that was going on with bitcoins. So if we look back at how the altcoins move generally what happens is you have a new series of buyers that come into the market and they’re all centered around Bitcoin. And that’s happening right now. Kelly Lafleur just announced from backed that they’re gonna have physically backed futures have been approved September 23rd I believe is the date that they’re actually gonna start trading. So this brings in a whole new group of traders a whole new group of investors and then so they start getting their feet with Bitcoin and all of a sudden they’re there they might not even know anything about alt coins Buck that that’s the thing right for a lot of people out there to them when they think digital currency the only thing they really think of is Bitcoin.
Buck: So as the alt coins are just anything that’s not Bitcoin for anybody what we keep talking about so anything Ethereum, any other and any other token that’s not Bitcoin generally it’s called an altcoin.
Teeka: Right so as they come in they start getting exposed to these other coins and then they start playing with them and they start investing and then they start trading with them and all of a sudden people look at look at Bitcoin and they look at something else it’s a little bit smaller and they say okay let’s let’s play around here and then you start seeing this broadening of the rally.
Buck: So you think that this time around though specifically I know you you you’re part of your thesis is that this time around may be different because you know bigger money institutional money, but one of the things that we’ve really looked at or you’ve looked at and talked about is you know one of the limitations to big money coming into this stuff is custodianship but the altcoins a lot of the old coins most of them are not gonna have that kind of infrastructure so does that I mean just playing devil’s advocate does that then say well they may just stick to whatever they can buy on Coinbase and Bakkt.
Teeka: Well they have well these coins most of the all coins are ERC 20 coins so in terms of having the infrastructure as long as you can support ERC 20 you can support hundreds of coins that currently trade and so if you look at what Bakkt is doing they’re gonna be supporting Bitcoin first and then they’re going to be supporting Ethereum. So if they support a theory they will naturally support every other ERC20 that’s out there and remember companies like Bakkt they’re in the business of incentivizing trading because they get paid for everything that that goes through their network. So it would be odd to imagine that they’re only going to limit their entire business models with just the trading of Bitcoin it doesn’t make any sense. If you look at what they’ve done in the securities market they haven’t just limited themselves to the trading of the S&P 500 they trade everything so I do think that liquidity will trickle down into the whole market and of course the ERC 20 coins I think will be the first to get the most amount of liquidity because it will be the easiest to support from from a back end technology standpoint. The other thing I want to mention is that another driver of the alt coins would be what I believe will be a proliferation of securitization products. So ETF’s different types of futures I see a world I’ve gotta believe within the next 12 months we will see an ETF that will give us the ability to own 20 30 40 maybe 50 coins in one ETF that trades or one type of security that trades maybe it’s a coin put out by back and says okay you buy this coin and you’ve got the top hundred altcoins exposure to the top hundred alt coins.
Buck: Right and then you know I know a lot of people bring do you talk about the ETF for Bitcoin and this has been sort of bounce back but yeah you know we’re delayed with the SEC several times do you really think of that as a big deal compared to some of the other movements that you you mentioned Bakkt and I think there’s LedgerX things like that where that are allowing for institutional buyers to dissipate is an etf really make much of a difference in your view?
Teeka: I think an ETF is important but I think the SEC is becoming less important in that process and I’ll tell you why. Several very large brokerage firms from the Fidelity to eTrade to TD Ameritrade have announced that they want to offer Bitcoin trading to their users. So I’m talking about a system where you can log in click on a button on your Fidelity account and you can start trading Bitcoin the way you with the sp500. Once that comes out let’s assume it comes out this year which they’ve talked about but they want to do it this year but we’ll see everything seems to run a little slower than people think. But if that that comes out this year and something like 15 to 20 million people can now trade Bitcoin directly from their brokerage accounts to me it makes an ETF a foregone conclusion because the SEC has no reason now to stand in the way of it. And that’s what I’m think that they’re waiting for Buck the SEC is not known for blazing a trail the SEC is not known for moving ahead of the market. So if they can look and say well Fidelity is offering it TD Ameritrade is offering it Schwab is offering it we are asses covered if we approve an ETF I think it’s really a CYA problem with the SEC they don’t want to be the first to make this move and let’s say there’s a problem with it and everybody blames the SEC.
Buck: You know there is this product data that I know of maybe you could talk about this because then you know in the context of an ETF and being able to buy Bitcoin easily you know.
Teeka: I look at the there’s a grayscale Bitcoin trust gbtc which is publicly traded I mean what’s the difference what am I missing there I mean that’s a closed-end fund that has limited liquidity and sometimes trade at a hundred percent premium.
Buck: Yeah okay so lots of things happening in the spaces you mentioned and one of the things that I think that that you said that is very seems very clearly true whether or not what you know whether or not you believe there’s gonna be another bull market is there’s a ton of of Technology improvements and infrastructure and all these things that are going on and price mean a lot more by the way then back in 2017 when prices were off the charts so within that context what are you know say they the one or two things that are you most excited about in the space that gives you the greatest confidence that this is you know this is the the new you know the new dot-com era I guess after the rebels fell as you mentioned before offline and you know the rise of the Amazons and the apples in the crypto world.
Teeka: I’ll tell you why it’s because I’m finally seeing major corporations real corporations doing partnerships with crypto companies not memorandums of understanding MOU’s are meaningless but real partnerships where they’re actually using the technology this is stuff i talked about a year ago. Eighteen and a half months ago I said like real companies are going to start coming into this space they’re gonna start partnering with some of these companies and start using the technology and it’s happening. I’m seeing real businesses like Barclays put up their own money to back certain platforms I was like for instance with trade finance. BMW putting up their own money for back in logistics. So this is a huge shift in in in the type of person that is getting involved in the marketplace. I’m seeing massive credit card processors get involved with tiny startups because they want to piggy back what’s going on and the markets that they’re opening up with with their with their applications. So this to me Buck is is such a difference maker right like if we came into 2019 and none of these deals were happening I would say I would be on here and I would say buck you know what the cake just isn’t baked yet man we just probably gotta wait another year. But when I start seeing very large very smart corporate players making strategic moves to align themselves to certain projects, you can’t ignore that. This is something you can’t ignore. And so this is what has me incredibly excited for this next phase that I see taking place in crypto.
Buck: You know one of the one things that you mentioned earlier and you’ve mentioned in the past which I agree with generally speaking is that you know some level of regulation is a good thing so that it becomes less of a manipulated market. So it becomes something that you know larger big money investors and institutional investors take an interest in because they don’t want to be in something that’s you know that’s that’s not legit. There is a negative a little bit to that and that some opportunities out there are you know start or you’re starting to get restricted in terms of American investors. You know one of the examples I can think of to me is one of what I’m probably one of the biggest things is Binance which is you know the number one trading platform in the world is now effectively you know saying US investors we’ll see you later we’re gonna build something you know sometime and we’re gonna call it you know Binance US and we’re gonna have a lot fewer tokens there what concerns me is an investor in some of the various digital currencies at that point is well how does that affect my liquidity as a US investor and I’m wondering how it is affecting your your portfolio?
Teeka: Okay so there’s a couple of things around that and I can’t advise people to do this I can only report on what some people are doing to get around this geofencing. They’re using Virtual Private Networks. With the use of a virtual private network can get access to any exchange in the world so long as they’re using a VPN that mimics a country that this exchange is allowed to operate in. So as far as I know Binance is not doing anything to prevent anybody from using a VPN so just want to get that out there.
Buck: Jut to interrupt there I mean that that in itself is a little tricky though right I mean isn’t it because then you’ve got to deal with you know US taxes and all that if you’re dealing…
Teeka: Well you always have to deal with US taxes no matter what whether you’re using a VPN or not.
Buck: So it wouldn’t be illegal technically to use Virtual Private Network to use Binance?
Teeka: For me as an individual would I be breaking any laws, I don’t think so but I’m not an attorney. Binance might be breaking some laws or but I don’t think that I would be but again this is something everybody has to make their own decision with. But the other side of this is that by Nance is putting together their own decks which is a decentralized exchange which will allow for peer-to-peer trading and I think you’ll see more of these types of decentralized exchanges which I’m a big fan of I hate the idea of centralized exchanges anyway. So there are some speed problems with decentralized exchanges but they’re getting ironed out and I think within in the future a lot of trading is going to move to peer-to-peer but you’re right it’s certainly a concern for now I would say the biggest solution that I have read about and again I can’t formally tell people to do this is to use a virtual private network.
Buck: The other question though I think as just as a follow-up on that Teeka is that okay so say you use a VPN but not everybody’s gonna do that you know probably most people aren’t gonna do that didn’t then there’s an issues just in terms of liquidity right or don’t you think that’s a problem anymore?
Teeka: I do think it’s a problem but I also rely on the greed factor of the participants in this market that they will figure out a solution because there’s too much money to be made for liquidity that wants to come into the market somebody will find a way to bring that liquidity into that okay so anyway so like you you know I believe that Bitcoin bull run is inevitable what do you think of anything what are you looking for that might trigger and I know you you’re saying already that we’re kind of in a bull market already but what triggers that sort of next level all-time high thing is there anything or do you think this is something that’s gonna be more of a gradual rise or organic than it was in 2017?
Teeka: Well there are several things which I’m gonna be talking about specifically I don’t really want to spill the beans on that here but I have an event coming up which I talk in more detail about a very specific event that I think will act as a massive catalyst. Outside of that I think this whole idea of I call it this kind of new narrative right among institutions where before two years ago three years ago they looked at Bitcoin and they said oh my gosh Bitcoin that’s for Gun Runners and pornographers where we we have no interest in Bitcoin. And now they’re starting to see Bitcoin as a way to eliminate this correlation risk in their portfolio. So I think that narrative will gain more ground in fact I’ve been invited to a conference in San Moritz with 500 top-tier investors and I will be putting forward that research that I’ve drawn together to that audience and really helping propagate that narrative because it is transformational if you manage a large pool of capital what you can do with your overall volatility and how you can adjust it lower through just a tiny amount of Bitcoin is absolutely remarkable. So I think that’s more of a slow burn Buck, but as that gains speed I mean can you just imagine just the amount of buying if pension funds say okay going forward half of 1% of all our assets are going to be in digital currency.
Buck: I mean in part of part of understanding that for people is to understand one of the the great things about Bitcoin in particular is that this is an asset with that is fixed to a certain number of Bitcoin that’ll ever be created so you know we’ve never really had a that kind of monetary thing before I mean to a certain extent gold is that way of course but even you know gold there’s always more gold every year a little bit more gold. This is a truly deflationary asset that really where you know you put more money in the pot you know each one of those bitcoins gonna be worth a lot more and that I can’t think of anything else that’s out there like that.
Teeka: I agree.
Buck: I know you’ve got you know the the Palm Beach Confidential Newsletter Teeka I just have to compliment you because I you know I have been a reader for a couple years it is one of the most comprehensive and thoughtful investment newsletters I’ve ever subscribed to. I mean it is totally the real deal and I appreciate that and one of the things that people can’t join any time and it opens and closes and I know that it is going to be opening up and you’re going to do a webinar coming up on that but can you talk a little bit about the newsletter and the event that’s coming up?
Teeka: Yeah sure so in the newsletter what I do is I will typically find one idea each month and give you a complete breakdown on the idea. And what I try to do I understand not everybody is a cryptocurrency enthusiastic of their currency investor and so what I try to do is write in a way that is easy to digest, easy to understand, not simplistic but very easy for the layperson to get their head around and to really understand the concept that we’re talking about. And I have not opened up Palm Beach confidential for any new members for this whole year, this is the first time that I’ve done that and the reason is, is I only open up Palm Beach confidential to new members when there’s an event that I think can have a massive impact on the broad market. So on September 18th at 8 p.m. I’m going to talk about one of these events and the last time this event took place you could literally take 500 dollars and turn it into five million dollars. There’s only a few times in the history of crypto where you have those types of windows of opportunity and so one of those windows of opportunity is about to open and so at this event I’m gonna explain what it is why it works and why it will absolutely happen this particular event will absolutely happen there’s nothing that can stop the event from taking place. And so I’m gonna share my five top coins, one of which I’ll give away for free during the webinar that I think have that ability to go from five hundred dollars literally into five million. So it’s an exciting time and I’m really kind of chomping at the bit to kind of get in front of everybody and talk about this research that I’ve discovered.
Buck: One last thing I want to point out is I get you know when we talk like this sometimes people get really skeptical they’re like yeah that sounds a little salesy Buck that’s not really kind of the usual thing that you’re talking about and I get it right. The reality is this is a situation this isn’t you know there are real people out there there are kids out there who’ve become multimillionaires by doing exactly this. And so it’s real, that’s why I’m interested.
Teeka: In my own investing I’ve seen a thousand dollar investment go to as much as 1.6 million dollars, ok so it’s real. The other thing I want to convey to everybody I don’t have to write newsletters anymore I don’t have to come on podcast I can sit on a beach all I want ok. So why do I do this I do this because moving the needle on somebody’s net worth maybe not this audience maybe maybe my broader audience it’s incredibly gratifying right helping people change their lives without putting their current lifestyle at risk that’s I mean if that’s my one legacy in this life could you ask for anything more Buck? Really it’s incredibly gratifying to be able to do that and we have this opportunity now and but this opportunity won’t last forever at some point this will be a multi trillion dollar asset class and the ability to make gains like that just won’t exist.
Buck: Teeka, as always it’s been a pleasure talking to you and thanks again for being on Wealth Formula Podcast.
Teeka: Thank you Buck.
Buck: We’ll be right back.
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Consensus Network EP35: Cryptocurrency and Asymmetric Risk with Teeka Tiwari

Catch the full episode: https://www.consensusnetwork.io/podcastepisodes/2019/9/8/ep35-cryptocurrency-and-asymmetric-risk-with-teeka-tiwari
Buck: Welcome back to the show everyone. Today my guest on Wealth Formula Podcast is no stranger to the show. He's a guy who grew up in foster care and came over the US at the age of 16 with just 150 bucks in his pocket and the clothes on his back. And then by the age of 18 becomes the youngest employee at Lehman Brothers. By 20 he becomes the youngest vice president in Lehman history. Later in his career he goes on to launch successful hedge fund and lived the Wall Street dream. I mean he's known on Wall Street as the guy who's made a fortune on what is known as asymmetric risk which is what we’re going to talk about in quite a bit and for the rest of us, for many of us that is, he is best known for being the editor of the Palm Beach confidential newsletter which focuses on digital currencies and I am a subscriber to this by the way. Teeka, welcome back to Wealth Formula Podcast, Teeka Tiwari.
Teeka: Thanks Buck. It’s a pleasure to be here and thank you for having me.
Buck: Yeah so you know you were on not too long ago and some people are listening to the stuff about cannabis and they're probably thinking to themselves, why is this guy talking about cannabis and digital currencies like what is his specialty? In fact the way I'm thinking about this there's one main thing that they have in common, they're both in this area that you call and we call asymmetric risk which is really your thing. Discuss what that means and if you would how have you applied it to your own growth and ultimately to your own wealth.
Teeka: So before I get into asymmetric risk I want to talk about how I discovered asymmetric risk and how I changed the way that I yeah. So when I was in my 20s I developed a lot of wealth by taking massive risk in the stock options and commodities market. And I would bet huge positions. And then that all came to an end in the late 90s when I was on the wrong side of a series of trades that were triggered by the Asian financial crisis which ultimately compelled me to file for bankruptcy. And so I had lost about ten years of wealth creation which was considerable at the time. And what I learned was that I had to change my approach that I couldn't get it all every single time otherwise I would never get off this boom-and-bust merry-go-round. So what I realized was is that I would I would build the portfolio of somewhat safer more income oriented investments and then I would focus on these ideas that are called asymmetric risk trade. So what's an asymmetric risk trade? An asymmetric risk trade is where you can take a relatively trivial sum of money and if the idea doesn't work out it doesn't impact your net your net worth or your day-to-day lifestyle in any way shape or form. But the asymmetric part of it is is that if it does work out it can absolutely move the needle on your net worth. So an example of that would be something like neo which I recommended at around 12 cents that ended up going up to about a hundred and sixty one dollars so that's something that you could have put a thousand dollars in and turn it into over a million dollars. That's a classic asymmetric trade. So what I what I tell my readers is you can't build your whole portfolio around high-risk asymmetric trades. But if you take let's say five to ten percent of your liquid net worth and allocate it to these types of situations in a and one of the things I talk about is using uniform position sizing, what you put yourself in the position to do is absolutely grow your network sometimes three four five six X without putting your current lifestyle at risk and it is a sweet spot of wealth creation that I've created and popularized now for several years that has not only transformed my financial life but the financial life of many of my readers.
Buck: So as you know Teeka my group the Wealth Formula Group in general I mean there's a lot of people who are well-to-do they're you know accredited investors they have you know typically probably more money to invest than others they're you know and I say this because there is a little bit of a difference there when it comes to somebody who's barely getting by living check to check, that there is an opportunity in your portfolio to say okay what percentage of this portfolio could I put in that I mean listen if I lose it no big deal I mean I won't be happy about it but it won't hurt me that much on the other hand this could explode. Now when you look at it from the perspective of somebody who's got a fair amount of money and link who's investing you know several hundred thousand dollars a year or maybe a million dollars or something like that like what do you think is a reasonable amount of a portfolio? Like I know for example that even universities are getting into this and they're looking at hey maybe you know 1/2 of 1% or something like that I mean I know you're not in the business of giving financial advice but I'm just curious kind of what your approach would be in terms of allocation.
Teeka: So again generally speaking I would say 5 to 10% of your liquid net worth. So let's say you've got a business that kicks out a million a year that you have to allocate for your investment 50 to $100,000. Definitely nobody likes to lose 50 or a hundred thousand dollars but it's not going to have a material impact on your lifestyle but if you invest 50 to $100,000 and these asymmetric bets pay off you're talking about five six seven eight ten twelve million dollars in returns on what is a relatively tiny investment relative to your net worth and that is the beauty of this approach.
Buck: Yeah and and I'm glad you said that because that's exactly kind of where I'm at sort of lingering between five and ten percent you know and for me you know I I kind of put this in there about you know I kind of put this in that area with startups right I'm not gonna I'm not gonna have a separate category just for digital currencies but anything that is super high risk and high reward and I'm sitting about five or ten percent.
Teeka: That all goes into the same bucket so that's right that for everybody it's not just oh this is crypto currencies five to ten percent and startups is five to ten percent. No all go into the same bucket is asymmetric risk.
Buck: Yeah now okay so we kind of got ahead of ourselves and you know you haven't been on the show talking about crypto currency in a fair amount of time we have a lot more new listeners now so for those who know very little about cryptocurrency but they're smart they're sophisticated say they're a group of you know I know worth investors you're talking to you they've not heard about this how do you explain this in the most efficient way possible and what the significance of it is?
Teeka: Okay so that's a really big question.
Buck: Yeah no I don't but I bet you've answered it a few times.
Teeka: I'm gonna take a shot at it. So listen as a wealthy investor myself why would I want to bother with cryptocurrency? I'm already rich why do I want to mess around with this? So I'm gonna answer it from that perspective. One it's always nice to make more money. But two the bigger reason is, is what I want people to understand especially wealthy investors is that it's very rare to invest at the beginning of a brand-new asset class very very rare right it's brand-new asset classes though just don't come about. Digital currency is a brand-new asset class that has legs. So why does it have legs? It has legs because we have never had an asset class that is completely non correlated with the business cycle. It's never existed before. Every asset class in the world is somehow tied to the business cycle gold, industrial, metals, currencies, stocks, bonds, they're all tied to the business cycle in one way shape or form things like Bitcoin are not so why why does that make it valuable it makes it valuable because if you are pension fund you're allocating capital across traditional and non-traditional assets you still have this problem of deep correlation right the business cycle falls apart and you're taking hits across the board. So there have been studies that have shown just with a small allocation of Bitcoin anywhere from one to five percent across the portfolio even though Bitcoin is wildly volatile because it is not correlated and not tied to the business cycle it actually reduces your overall volatility and your overall risk in your portfolio and that is incredibly valuable. So just from a high level portfolio construction standpoint you will see the world's hedge funds, pension funds, massive allocators of capital start to move tiny slivers of their money into things like Bitcoin and we're talking tiny slivers of an 80 trillion dollar pie right it's in real terms its enormous money in relative terms relative to what they have under management it's a small amount but when you're coming off a base where the whole markets only worth 300 billion it doesn't take much to move the market. So that's from the high level that's why you must have some cryptocurrency. And then the next level beyond that is that mankind has never had an asset there's never been an asset we're a stronger man couldn't take it from a weaker man. So whether it was the caveman knocking one guy over the head for his shells or the government coming in in Venezuela and confiscating money or the Argentinian government saying oh we're having a holiday and taking all your assets from the bank something Brazil has done on multiple occasions. You know the everyday person has not had this ability to hold an asset that has been beyond the confiscationability of a government so something like Bitcoin and digital currency if you are smart and how you buy it if you don't talk about it you buy quietly and you store it appropriately it is absolutely impossible short of somebody putting a literally putting a gun next to your head for them to take that asset from you and that is remarkable because even if you've got a million dollars in gold and you somehow manage to hide it how are you gonna travel the world with a million dollars in gold how are you gonna spend a million dollars in gold you just gonna go to the store and break a piece off with a piece of pliers you just can't do that the beauty of digital currency is you can walk around with a thumb drive that big with a billion dollars in it and nobody knows and let's say hey oh I don't want to keep a billion in Bitcoin I want to do it in a stable coin fine put it in a stable coin. But this idea this portability of money and this complete ownership of an asset that nobody else has any ability to take from you that is valuable that is incredibly valuable.
Buck: So let me ask you a what may seem like a very basic simple question but I think it's worth asking. So why is it so volatile why is Bitcoin Ethereum for example why these are the major the two biggest by market cap why are they so volatile and you know to the extent that they are uncorrelated do you see that as a function of the size of the market cap or is it something else inherent about digital currencies that makes it this volatile?
Teeka: I think it's both. One they're relatively small so if for instance if you look at Microsoft in its early days it was a crazy volatile stock up 40% down 40% down 30% going through bear markets that lasted two years wrecking billions of dollars in value you look at the early days of Microsoft from the 80s into the mid 90s the stock was all over the place and then as the stock got bigger and more mature of course volatility tamp down so you will see that. So what I say with volatility is that welcomed that volatility without it the opportunity to make enormous amounts of money off a small amount of money won't exist. At some point Bitcoin and the theorem will move to this more blue chip status where maybe you make eight percent a year or six percent a year or something or something like that thank goodness we're not there yet. The other side of it is is that there you know the markets that are built around trading these are completely unregulated. They're wild. And there's all types of crazy manipulation that goes on in the market you have some Bitcoin whale let's sell a thousand coins and scare the market down and then let's go buy back 2000 coins it's the Wild West and somebody a skeptic might say well why do I want to buy now why don't I buy when the market calms down because when you buy when the market calms down and it's moved to this very highly regulated very low volatility asset it could have ten x between now and then. So yes there is volatility but I believe if you position size rationally you will be well rewarded for that moment for that volatility and that uncertainty.
Buck: So admittedly I was skeptical of cryptocurrency early on and you know I finally did get in and my timing was actually really good it was a fall early fall 2017 right before a massive bull run. And that of course was followed by what has been called crypto winter. So the question is, is winter over because it sure seems like it's an awful long thawing period I mean no we seem like to have gotten there but there's a stall is it over or do you still see some you know rocky shores ahead before there's a you know big move potentially to all-time highs?
Teeka: Well no crypto winter was over in April. I put out a report talking about that and I pinpointed when that happened it happened when Bitcoin broke its downtrend line. So if you go back and if you look at each of the so-called crypto winters or horrible bear markets that have been in the space Bitcoin will always lead the market first always and then the altcoins play catch up right so it feels worse than it is right now because the alt coins got crushed and many of them have stayed crushed they haven't come back that’s probably the most popular question I get take okay bitcoins up and it's you know been up as much as 400 percent this year but why aren't the old coins moving and my answer is because it's not yet time. If you look back at the data generally there is at least a six-month time lag between the time Bitcoin breaks its downtrend line and the time that the alt coins move higher. So that that next stage we'll be entering to in about October and you'll see a percolation in the alt coins and they'll start playing catch-up.
Buck: Does that also correlate Teeka with Bitcoin like an all-time high for Bitcoin though? I mean I mean obviously Bitcoin has recovered substantially we're like you know three four hundred percent up from you know where we were when Bitcoin was at you know three thousand. The question I have is and I have not looked at this history closely even though there's this recovery, do you have to start approaching all-time highs for those alts to really make their move is that what you've seen historically?
Teeka: No you look back when they all started playing catch up in 2016 Bitcoin was starting to move higher and then going into 2017 and then the alts really didn't start kicking in until around May and that's when they started moving and eventually the alts outpaced the type of action that was going on with bitcoins. So if we look back at how the altcoins move generally what happens is you have a new series of buyers that come into the market and they're all centered around Bitcoin. And that's happening right now. Kelly Lafleur just announced from backed that they're gonna have physically backed futures have been approved September 23rd I believe is the date that they're actually gonna start trading. So this brings in a whole new group of traders a whole new group of investors and then so they start getting their feet with Bitcoin and all of a sudden they're there they might not even know anything about alt coins Buck that that's the thing right for a lot of people out there to them when they think digital currency the only thing they really think of is Bitcoin.
Buck: So as the alt coins are just anything that's not Bitcoin for anybody what we keep talking about so anything Ethereum, any other and any other token that's not Bitcoin generally it's called an altcoin.
Teeka: Right so as they come in they start getting exposed to these other coins and then they start playing with them and they start investing and then they start trading with them and all of a sudden people look at look at Bitcoin and they look at something else it's a little bit smaller and they say okay let's let's play around here and then you start seeing this broadening of the rally.
Buck: So you think that this time around though specifically I know you you you're part of your thesis is that this time around may be different because you know bigger money institutional money, but one of the things that we've really looked at or you've looked at and talked about is you know one of the limitations to big money coming into this stuff is custodianship but the altcoins a lot of the old coins most of them are not gonna have that kind of infrastructure so does that I mean just playing devil's advocate does that then say well they may just stick to whatever they can buy on Coinbase and Bakkt.
Teeka: Well they have well these coins most of the all coins are ERC 20 coins so in terms of having the infrastructure as long as you can support ERC 20 you can support hundreds of coins that currently trade and so if you look at what Bakkt is doing they're gonna be supporting Bitcoin first and then they're going to be supporting Ethereum. So if they support a theory they will naturally support every other ERC20 that's out there and remember companies like Bakkt they're in the business of incentivizing trading because they get paid for everything that that goes through their network. So it would be odd to imagine that they're only going to limit their entire business models with just the trading of Bitcoin it doesn't make any sense. If you look at what they've done in the securities market they haven't just limited themselves to the trading of the S&P 500 they trade everything so I do think that liquidity will trickle down into the whole market and of course the ERC 20 coins I think will be the first to get the most amount of liquidity because it will be the easiest to support from from a back end technology standpoint. The other thing I want to mention is that another driver of the alt coins would be what I believe will be a proliferation of securitization products. So ETF's different types of futures I see a world I've gotta believe within the next 12 months we will see an ETF that will give us the ability to own 20 30 40 maybe 50 coins in one ETF that trades or one type of security that trades maybe it's a coin put out by back and says okay you buy this coin and you've got the top hundred altcoins exposure to the top hundred alt coins.
Buck: Right and then you know I know a lot of people bring do you talk about the ETF for Bitcoin and this has been sort of bounce back but yeah you know we're delayed with the SEC several times do you really think of that as a big deal compared to some of the other movements that you you mentioned Bakkt and I think there's LedgerX things like that where that are allowing for institutional buyers to dissipate is an etf really make much of a difference in your view?
Teeka: I think an ETF is important but I think the SEC is becoming less important in that process and I'll tell you why. Several very large brokerage firms from the Fidelity to eTrade to TD Ameritrade have announced that they want to offer Bitcoin trading to their users. So I'm talking about a system where you can log in click on a button on your Fidelity account and you can start trading Bitcoin the way you with the sp500. Once that comes out let's assume it comes out this year which they've talked about but they want to do it this year but we'll see everything seems to run a little slower than people think. But if that that comes out this year and something like 15 to 20 million people can now trade Bitcoin directly from their brokerage accounts to me it makes an ETF a foregone conclusion because the SEC has no reason now to stand in the way of it. And that's what I'm think that they're waiting for Buck the SEC is not known for blazing a trail the SEC is not known for moving ahead of the market. So if they can look and say well Fidelity is offering it TD Ameritrade is offering it Schwab is offering it we are asses covered if we approve an ETF I think it's really a CYA problem with the SEC they don't want to be the first to make this move and let's say there's a problem with it and everybody blames the SEC.
Buck: You know there is this product data that I know of maybe you could talk about this because then you know in the context of an ETF and being able to buy Bitcoin easily you know.
Teeka: I look at the there's a grayscale Bitcoin trust gbtc which is publicly traded I mean what's the difference what am I missing there I mean that's a closed-end fund that has limited liquidity and sometimes trade at a hundred percent premium.
Buck: Yeah okay so lots of things happening in the spaces you mentioned and one of the things that I think that that you said that is very seems very clearly true whether or not what you know whether or not you believe there's gonna be another bull market is there's a ton of of Technology improvements and infrastructure and all these things that are going on and price mean a lot more by the way then back in 2017 when prices were off the charts so within that context what are you know say they the one or two things that are you most excited about in the space that gives you the greatest confidence that this is you know this is the the new you know the new dot-com era I guess after the rebels fell as you mentioned before offline and you know the rise of the Amazons and the apples in the crypto world.
Teeka: I'll tell you why it's because I'm finally seeing major corporations real corporations doing partnerships with crypto companies not memorandums of understanding MOU’s are meaningless but real partnerships where they're actually using the technology this is stuff i talked about a year ago. Eighteen and a half months ago I said like real companies are going to start coming into this space they're gonna start partnering with some of these companies and start using the technology and it's happening. I'm seeing real businesses like Barclays put up their own money to back certain platforms I was like for instance with trade finance. BMW putting up their own money for back in logistics. So this is a huge shift in in in the type of person that is getting involved in the marketplace. I'm seeing massive credit card processors get involved with tiny startups because they want to piggy back what's going on and the markets that they're opening up with with their with their applications. So this to me Buck is is such a difference maker right like if we came into 2019 and none of these deals were happening I would say I would be on here and I would say buck you know what the cake just isn't baked yet man we just probably gotta wait another year. But when I start seeing very large very smart corporate players making strategic moves to align themselves to certain projects, you can't ignore that. This is something you can't ignore. And so this is what has me incredibly excited for this next phase that I see taking place in crypto.
Buck: You know one of the one things that you mentioned earlier and you've mentioned in the past which I agree with generally speaking is that you know some level of regulation is a good thing so that it becomes less of a manipulated market. So it becomes something that you know larger big money investors and institutional investors take an interest in because they don't want to be in something that's you know that's that's not legit. There is a negative a little bit to that and that some opportunities out there are you know start or you're starting to get restricted in terms of American investors. You know one of the examples I can think of to me is one of what I'm probably one of the biggest things is Binance which is you know the number one trading platform in the world is now effectively you know saying US investors we'll see you later we're gonna build something you know sometime and we're gonna call it you know Binance US and we're gonna have a lot fewer tokens there what concerns me is an investor in some of the various digital currencies at that point is well how does that affect my liquidity as a US investor and I'm wondering how it is affecting your your portfolio?
Teeka: Okay so there's a couple of things around that and I can't advise people to do this I can only report on what some people are doing to get around this geofencing. They're using Virtual Private Networks. With the use of a virtual private network can get access to any exchange in the world so long as they're using a VPN that mimics a country that this exchange is allowed to operate in. So as far as I know Binance is not doing anything to prevent anybody from using a VPN so just want to get that out there.
Buck: Jut to interrupt there I mean that that in itself is a little tricky though right I mean isn't it because then you've got to deal with you know US taxes and all that if you're dealing…
Teeka: Well you always have to deal with US taxes no matter what whether you're using a VPN or not.
Buck: So it wouldn't be illegal technically to use Virtual Private Network to use Binance?
Teeka: For me as an individual would I be breaking any laws, I don't think so but I'm not an attorney. Binance might be breaking some laws or but I don't think that I would be but again this is something everybody has to make their own decision with. But the other side of this is that by Nance is putting together their own decks which is a decentralized exchange which will allow for peer-to-peer trading and I think you'll see more of these types of decentralized exchanges which I'm a big fan of I hate the idea of centralized exchanges anyway. So there are some speed problems with decentralized exchanges but they're getting ironed out and I think within in the future a lot of trading is going to move to peer-to-peer but you're right it's certainly a concern for now I would say the biggest solution that I have read about and again I can't formally tell people to do this is to use a virtual private network.
Buck: The other question though I think as just as a follow-up on that Teeka is that okay so say you use a VPN but not everybody's gonna do that you know probably most people aren't gonna do that didn't then there's an issues just in terms of liquidity right or don't you think that's a problem anymore?
Teeka: I do think it's a problem but I also rely on the greed factor of the participants in this market that they will figure out a solution because there's too much money to be made for liquidity that wants to come into the market somebody will find a way to bring that liquidity into that okay so anyway so like you you know I believe that Bitcoin bull run is inevitable what do you think of anything what are you looking for that might trigger and I know you you're saying already that we're kind of in a bull market already but what triggers that sort of next level all-time high thing is there anything or do you think this is something that's gonna be more of a gradual rise or organic than it was in 2017?
Teeka: Well there are several things which I'm gonna be talking about specifically I don't really want to spill the beans on that here but I have an event coming up which I talk in more detail about a very specific event that I think will act as a massive catalyst. Outside of that I think this whole idea of I call it this kind of new narrative right among institutions where before two years ago three years ago they looked at Bitcoin and they said oh my gosh Bitcoin that's for Gun Runners and pornographers where we we have no interest in Bitcoin. And now they're starting to see Bitcoin as a way to eliminate this correlation risk in their portfolio. So I think that narrative will gain more ground in fact I've been invited to a conference in San Moritz with 500 top-tier investors and I will be putting forward that research that I've drawn together to that audience and really helping propagate that narrative because it is transformational if you manage a large pool of capital what you can do with your overall volatility and how you can adjust it lower through just a tiny amount of Bitcoin is absolutely remarkable. So I think that's more of a slow burn Buck, but as that gains speed I mean can you just imagine just the amount of buying if pension funds say okay going forward half of 1% of all our assets are going to be in digital currency.
Buck: I mean in part of part of understanding that for people is to understand one of the the great things about Bitcoin in particular is that this is an asset with that is fixed to a certain number of Bitcoin that'll ever be created so you know we've never really had a that kind of monetary thing before I mean to a certain extent gold is that way of course but even you know gold there's always more gold every year a little bit more gold. This is a truly deflationary asset that really where you know you put more money in the pot you know each one of those bitcoins gonna be worth a lot more and that I can't think of anything else that's out there like that.
Teeka: I agree.
Buck: I know you've got you know the the Palm Beach Confidential Newsletter Teeka I just have to compliment you because I you know I have been a reader for a couple years it is one of the most comprehensive and thoughtful investment newsletters I've ever subscribed to. I mean it is totally the real deal and I appreciate that and one of the things that people can't join any time and it opens and closes and I know that it is going to be opening up and you're going to do a webinar coming up on that but can you talk a little bit about the newsletter and the event that's coming up?
Teeka: Yeah sure so in the newsletter what I do is I will typically find one idea each month and give you a complete breakdown on the idea. And what I try to do I understand not everybody is a cryptocurrency enthusiastic of their currency investor and so what I try to do is write in a way that is easy to digest, easy to understand, not simplistic but very easy for the layperson to get their head around and to really understand the concept that we're talking about. And I have not opened up Palm Beach confidential for any new members for this whole year, this is the first time that I've done that and the reason is, is I only open up Palm Beach confidential to new members when there's an event that I think can have a massive impact on the broad market. So on September 18th at 8 p.m. I'm going to talk about one of these events and the last time this event took place you could literally take 500 dollars and turn it into five million dollars. There's only a few times in the history of crypto where you have those types of windows of opportunity and so one of those windows of opportunity is about to open and so at this event I'm gonna explain what it is why it works and why it will absolutely happen this particular event will absolutely happen there's nothing that can stop the event from taking place. And so I'm gonna share my five top coins, one of which I'll give away for free during the webinar that I think have that ability to go from five hundred dollars literally into five million. So it's an exciting time and I'm really kind of chomping at the bit to kind of get in front of everybody and talk about this research that I've discovered.
Buck: One last thing I want to point out is I get you know when we talk like this sometimes people get really skeptical they're like yeah that sounds a little salesy Buck that's not really kind of the usual thing that you're talking about and I get it right. The reality is this is a situation this isn't you know there are real people out there there are kids out there who've become multimillionaires by doing exactly this. And so it's real, that's why I'm interested.
Teeka: In my own investing I've seen a thousand dollar investment go to as much as 1.6 million dollars, ok so it's real. The other thing I want to convey to everybody I don't have to write newsletters anymore I don't have to come on podcast I can sit on a beach all I want ok. So why do I do this I do this because moving the needle on somebody's net worth maybe not this audience maybe my broader audience it's incredibly gratifying right helping people change their lives without putting their current lifestyle at risk that's I mean if that's my one legacy in this life could you ask for anything more Buck? Really it's incredibly gratifying to be able to do that and we have this opportunity now and but this opportunity won't last forever at some point this will be a multi trillion dollar asset class and the ability to make gains like that just won't exist.
Buck: Teeka, as always it's been a pleasure talking to you and thanks again for being on Wealth Formula Podcast.
Teeka: Thank you Buck.
Buck: We'll be right back.
submitted by Buck_Joffrey to u/Buck_Joffrey [link] [comments]

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