Expat investors will be relieved to hear that cryptocurrencies are still very much in the running as powerful investments – after coming up smiling from a serious run in with the US regulators in February.
Cryptos – volatile but viable!
Q1 2018 has been the worst quarter in the history of cryptocurrencies. But over just this last week ending 13 April 2018 total crypto market capitalisation is back on its uppers with a healthy 23% rise to $326bn (coincentral.com). Bitcoin put on over a thousand dollars overnight last week, so volatility is still the name of the game. But the clear good news is that the crypto bubble that everybody feared has quietened down on its own without destroying the market.
The 60%+ falls in value since last year amongst big crypto names like Bitcoin and Ethereum are recognised now as price corrections – not catastrophes!
After a big meeting in February 2018 between the two biggest US regulators, the big fear amongst cryptocurrency supporters was that regulation coming from the States would destroy the sector. But it was great news for crypto “HODLers” (investors keen to “hold” cryptos for the long-term) after the meeting between the US SEC (Securities Exchange Commission) and the CTFC (Commodities Futures Trading Commission).
Chairman J. Clayton of the SEC surprised everybody by drawing a clear distinction between three areas of cryptos: the tech they are based on, the currencies themselves, and the way the currencies come to market initially. Clayton said that growth would be supported for cryptocurrencies and the Distributed Ledger Technology (DLT) they are based on, but that ICOs – ie. International Coin Offerings, where cryptos are offered for sale at launch – would be closely monitored for scamsters. Clayton’s comments were hailed as strongly bullish news for the crypto markets.
Positive noises too came from from Chairman J. Giancarlo of the CTFC who said, “we owe it to this generation to respect this generation’s interest in cryptocurrencies, and punish those who persecute.” In early March 2018, the US Federal District Court ruled that crypto are commodities and therefore come under the jurisdiction of the CTFC.
The message seems to be: don’t throw the baby out with the bathwater. There are ongoing issues with cryptocurrencies, but the proven practical value of the underlying technology means the market is far from dead.
“It’s important to remember that if there were no Bitcoin, there would be no Distributed Ledger Technology,” said Giancarlo at the hearing in early February 2018. “Sixty-six million tons of American soybeans were just handled through a blockchain transaction by the Dreyfus company to China … I think this Distributed Ledger Technology has enormous potential.”
JP Morgan CEO J. Dimon, who once called Bitcoin a fraud, is another key figure in the crypto world to acknowledge that the underlying Distributed Ledger Technology – in Bitcoin’s case, Blockchain – is a valuable and practical asset, despite international fears over criminal connections to cryptos as well as their arguably speculative nature as investments.
New Crypto comes a-cropper in Dubai …
A Dubai crypto firm has been issued a restraining order by a US court after allegedly infringing on the copyright of Chinese giant Alibaba, the world’s largest online merchandising company £527bn. The Alibabacoin Foundation were stopped in round 2 of their crowdsale, having aimed to raise £3.5m on the back of their ICO of “Alibabacoin”.