World’s Biggest VC Firms are Creating Cryptocurrency Funds, Market Enthusiastic

Historically venture capitalists do not own cryptocurrencies. They hold equity and invest in privately and publicly held companies but, with the potential of cryptocurrency and blockchain based technology companies to create unprecedented returns VC firms are exploring ways to restructure legally and financially to tap into that future revenue stream.

VC Firms Creating New Strategies for Crypto

Recode recently examined four different strategies some of the top venture capital firms have taken to re-orientate the way they do business.

Andreesen Horowitz, cofounded by Marc Andreesen creator of the first web browser (Netscape Navigator) and longtime Bitcoin enthusiast, for instance, has created a separate pool of money raised specifically for investment in cryptocurrency projects. This allows Horowitz to put together a group of investors whose main interest is in the nascent technology. It also allows the firm to sidestep laws that limit VC firms from having more than 20% of their investments in assets considered liquid securities such as cryptocurrencies.

Finding a middle ground between launching a separate fund such as Horowitz has and maintaining the traditional status quo allows LightSpeed Venture Partners to earmark a percentage from a general fund specifically for investment in crypto projects. This sends a message to the crypto world that they are dedicated to the space and attracts investors whose main interest is in crypto projects, while soothing partners still skeptical about the volatile industry.

The famous New York Venture Capital firm Union Square Ventures leads a handful of smaller funds putting money into crypto-specific funds set up by other firms. With this strategy, the firm doesn’t have to create a separate unit for crypto but, still gains plenty of exposure to the space without the time and resource commitment of owning any startups. It also allows them to invest simultaneously in multiple funds.

Fred Wilson from USV has advised investors previously about having at least some position in crypto saying:

“If I were a trader, a stock trader or hedge fund person, I might think of having 5% of my assets in something like this; it’s still early days; I don’t think you want to go all in on it, but I think you want to be in it.”

For most the Status Quo

Most VC firms so far have only made slight legal and financial tweaks to their traditional business models. This allows them to dabble in cryptocurrencies, to hold some coins or invest in ICO’s, without making radical changes that could upset partners or expose them to the ongoing legal troubles that crypto startups must negotiate. This is a safe hedge against a catastrophic shift in the crypto space that still allows them enough exposure to shift gears when the industry settles into a more traditional pattern.

Author JOHN MCMAHON | JUNE 22, 2018 | 5:03 AM

David Ogden – Http://markethive.com/david-ogden

Why bitcoin made a comeback after the South Korean exchange hack

Bitcoin declined on Wednesday after a South Korean exchange hack was reported.
But by the same evening, the digital coin had bounced back.

Two cryptocurrency traders explain why.

Bitcoin made a comeback despite crashing after a recent hack on a South Korean exchange, and two cryptocurrency traders explained why it rebounded.

Charlie Lee, the founder of Litecoin, a global decentralized currency that is based on blockchain technology, said it was to be expected.

"Whenever there's an exchange hack, people get scared and the price drops," Lee said on "Fast Money" Wednesday. "It happens all the time."

"Whenever there's some bad news like an exchange hack, the prices drop like 5 percent," he said. "Five percent is a lot in the stock market world, but it's like nothing in the crypto space."

Bitcoin, the largest digital coin by market cap, fell from $6,718.35 to $6,561.79 Wednesday after news that the South Korean cryptocurrency exchange Bithumb was hacked and $30 million of coins were stolen.

By Wednesday evening at 5:30 p.m. ET, bitcoin had rebounded to more $6,700 in what Kelly called a "mini uptrend."

The two traders explain why.

1. Bithumb acted quickly

Kelly said as soon as the news was reported the exchange took action.

"They halted withdrawals and they put everything into cold storage," he said.

2. Exchange paid back investor losses

Bithumb used its own money to pay back investors.

"They immediately said, 'Any losses, we have reserves. We're going to pay for them. Nobody loses money," Kelly said.

3. Fundamentals

Lee said when an exchange is hacked, it doesn't affect the fundamentals of the underlying coins.

He likened it to a bank robbery. If a bank gets broken into and gold is stolen, Lee said, it doesn't affect the price of gold.

"So same with bitcoin," he said. "If an exchange doesn't protect their coins well enough and it gets hacked, it doesn't really change the fundamentals of the coin that they're protecting."

Additionally, a report released on Wednesday, by a Washington law firm, stated that the cryptocurrency firm Tether has enough U.S. dollar reserves to back its digital coins. The report came on the heels of investor concerns that the firm may not have actually had the reserves to back up its coins.

"The past few years people have been scared that Tether has been printing their Tether coins out of thin air and buying bitcoin with it, which might be the cause of last year's run up," Lee said. "And if they actually do have the USD backing that means that the run-up is created by real demand and not fake demand. That's really good news."

Investors have to protect their cryptocurrency better

Brian Kelly, founder and CEO of BKCM LLC, an investment firm focused on digital currencies, advised investors to hold their cryptocurrency in cold storage — which involves storing it offline — if possible.

Exchanges are "kinda the weak point here," Kelly said on "Fast Money" Wednesday.

Lee added that the cryptocurrency industry is relatively new, and exchanges are still learning to protect their funds.

"People have to get used to that, they really need to protect their coins much better than traditional finance," he said.

– Reuters contributed to this report.

Author: Kellie Ell

David Ogden – Http://markethive.com/david-ogden

Bitcoin (BTC) Price Watch – Make or Break at Channel Resistance

Bitcoin (BTC) Price Watch - Make or Break at Channel Resistance

Bitcoin (BTC) Price Watch – Make or Break at Channel Resistance

Bitcoin Price Key Highlights

Bitcoin price looks ready to resume the slide after hitting the resistance at the descending channel.
This lines up with the Fib retracement levels, adding strength to the ceiling.
Technical indicators also support a continuation of the downtrend.

Bitcoin price climbed to the top of its descending channel where sellers were waiting to push it back down.

Technical Indicators Signals

The 100 SMA is still below the longer-term 200 SMA to confirm that the path of least resistance is to the downside. This suggests that the selloff is more likely to resume than to reverse.

The shorter-term moving average is also close to the 50% Fibonacci retracement level to signal that selling pressure is returning. This might be enough to push bitcoin price back to the channel support around $6,000 or lower.

RSI is also turning lower from the overbought zone to signal a return bearish momentum. Similarly stochastic is turning lower without even hitting overbought levels, indicating that bears are eager to return.

If bulls keep charging, there are still a couple of upside roadblocks to contend with. This is the 200 SMA dynamic inflection point at $7,600 and the swing high around $7,800. From there, a move past the $8,000 handle could signal that the uptrend is gaining traction.

Bitcoin price got another blow from remarks by Goldman Sachs CEO Lloyd Blankfein who said that this cryptocurrency is not for him. However, there is still some degree of positive sentiment coming from the New York FSA’s approval of Square’s Cash mobile app license and remarks from a senior SEC official last week citing that bitcoin shouldn’t be treated as a security.

However, dollar strength is proving tough to oppose as risk aversion on a fresh round of tariffs threats is keeping the safe-haven currency supported even against bitcoin.

SARAH JENN | JUNE 20, 2018 | 4:38 AM

David Ogden – Http://markethive.com/david-ogden

Bitcoin Cash Price Analysis – BCH/USD May Overtake $900

Bitcoin Cash Price Analysis - BCH/USD May Overtake $900

Bitcoin Cash Price Analysis – BCH/USD May Overtake $900

Key Points

Bitcoin cash price bounced back sharply from the $825 support area against the US Dollar.
Yesterday’s highlighted key bearish trend line with resistance at $840 was breached on the hourly chart of the BCH/USD pair (data feed from Kraken).
The pair is currently trading just below the $900-910 resistance, and it may soon break it.

Bitcoin cash price is showing positive signs above $850 against the US Dollar. BCH/USD is likely to continue higher above the $900-910 resistance.

Bitcoin Cash Price Trend

There was a test of an important support at $825 by bitcoin cash price recently against the US Dollar. The price found a strong buying interest and started an upside move above the $850 level. There was a break above the 50% Fib retracement level of the last decline from the $908 high to $825 low. It opened the doors for more gains and the price jumped further above $850.

More importantly, yesterday’s highlighted key bearish trend line with resistance at $840 was breached on the hourly chart of the BCH/USD pair. The pair also traded above the $880 level and it almost tested the $900 level. A high was formed at $898 before the price started consolidating gains. An initial support is around the 23.6% Fib retracement level of the last wave from the $826 low to $898 high. There may perhaps be more downsides in the near term, but supports such as $880 and $850 are likely to prevent losses.

Looking at the chart, the pair is placed nicely above the $850 level. Therefore, there are high chances of an upside break above the $900 and $908 resistance levels. The next hurdle above $908 is around the $950 pivot level.

Looking at the technical indicators:

Hourly MACD – The MACD for BCH/USD has moved back in the bullish zone.

Hourly RSI (Relative Strength Index) – The RSI for BCH/USD is now placed nicely in the overbought zone.

Major Support Level – $850

Major Resistance Level – $908

AAYUSH JINDAL | JUNE 19, 2018 | 4:08 AM

David Ogden – Http://markethive.com/david-ogden

Bitcoin (BTC) Price Watch – Eyes on This Consolidation Pattern

Bitcoin Price Key Highlights

Bitcoin has formed lower highs and higher lows to trade inside a symmetrical triangle pattern on its 1-hour chart.
Zooming out to longer-term time frames shows that this might be a bearish flag continuation pattern.

Price is nearing the peak of the formation to signal that a breakout in either direction is due soon.

Bitcoin price is consolidating inside a short-term symmetrical triangle pattern as bulls and bears wait for more decisive clues.

Technical Indicators Signals

The 100 SMA is below the longer-term 200 SMA on this time frame to signal that the path of least resistance is to the downside. This means that the selloff is more likely to resume than to reverse. The 100 SMA has held as dynamic resistance as well.

However, the gap between the moving averages has narrowed significantly to signal a slowdown in bearish pressure. This could also signal an imminent bullish crossover that could draw more buyers in and spur a reversal from the bitcoin price downtrend.

RSI still seems to be heading lower, though, so sellers might still have some energy to push for a break below support. The triangle spans $6,200 to $,6900 so the resulting breakout could be of the same size. Stochastic, on the other hand, appears to have bottomed out and is ready to turn higher.

Market Factors

Dollar strength kicked into high gear on Friday when the Trump administration imposed tariffs on Chinese goods and China retaliated with their own measures on US exports. Further escalation of these tensions could keep traders flocking to the safe-haven dollar and away from riskier assets like bitcoin.

Besides, the lack of positive updates from the industry has kept bitcoin price in consolidation, even after a senior SEC official suggested that it isn’t subject to securities regulation. After all, this hardly constitutes an official ruling so investors are waiting to hear more remarks from other regulators.

SARAH JENN | JUNE 18, 2018 | 4:03 AM

David Ogden – Http://markethive.com/david-ogden

Bitcoin Price Weekly Analysis: Can BTC/USD Gain Traction

Bitcoin Price Weekly Analysis: Can BTC/USD Gain Traction?

Key Points

Bitcoin price is currently consolidating around the $6,500 level against the US Dollar.
The BTC/USD pair is currently attempting an upside break above a declining channel with resistance at $6,500 on the 4-hours chart (data feed from Kraken).
The pair may move a few points higher, but there are many hurdles on the upside near the $6,800 level.

Bitcoin price is stable above the $6,400 level against the US Dollar. BTC/USD must gain momentum above $6,600 and $6,800 to move into a bullish zone.

Bitcoin Price Resistance

This past week, bitcoin price started an upside correction after dropping to the $6,130 level against the US Dollar. The BTC/USD pair moved above the $6,200 and $6,400 resistance levels. There was also a break above the 23.6% Fib retracement level of the last downside move from the $7,785 high to $6,130 swing low. However, the price faced a lot of sellers around the $6,700 level.

There was a rejection from a declining channel with current resistance at $6,500 on the 4-hours chart of the BTC/USD pair. Moreover, the 38.2% Fib retracement level of the last downside move from the $7,785 high to $6,130 swing low acted as a hurdle. The price moved down below $6,600 but found support. It is currently moving higher once again and is attempting a break above the same channel and $6,500. Should the price succeed in moving past the channel resistance, it could move higher towards the $6,600 and $6,700 resistance levels. Above this last, the next hurdle sits around the $6,800 level.

Looking at the chart, the current price action suggests consolidation above the $6,400 level. A break above the $6,700 level may perhaps open the doors for an upside push towards $7,000.

Looking at the technical indicators:

4-hours MACD – The MACD for BTC/USD is currently flat in the bullish zone.

4-hours RSI (Relative Strength Index) – The RSI is just around the 50 level.

Major Support Level – $6,400

Major Resistance Level – $6,700

Author AAYUSH JINDAL | JUNE 17, 2018 | 4:48 AM

David Ogden – Http://markethive.com/david-ogden

Selling Bitcoin [BTC] for fiat is âreverting to the pastâ, says Tim Draper

Selling Bitcoin [BTC] for fiat is “reverting to the past”, says Tim Draper

Tim Draper made another bullish prediction about the price of Bitcoin [BTC]. He also believes that fiat currencies will become a thing of the past.

He said:

“Price-wise, we’ll continue to see Bitcoin move higher. I’ve revised my estimate up to $250,000 four years out, so we’ll see Bitcoin trade around the $250,000 mark in 2022.”

He said that he is placing his bets on cryptocurrencies increasing the velocity of money, predicting that the cryptocurrency market will hit $140 trillion within the next decade. He said:

“I expect that since cryptocurrencies will increase the velocity of money, the current $86 trillion global market for currency will grow to be about $140 trillion in the next 10 years, and that growth will be in crypto. In fact, I estimate that fiat currencies will actually decrease in use, and that crypto will become as much as $100 trillion of that market. I expect Bitcoin to be about 10% of that market, or $10 trillion. There is a lot of room to grow there.”

He expects that the world would move into the cryptocurrency space, not for storing value, as it is used for today, but as a means of transacting value. He stated that in four years people will start paying in cryptocurrency all over the world.

Draper quoted the problem with Bitcoin as being the small block size which resulted in its inability to conduct microtransactions. He referred to second-layer scaling solutions such as Lightning Network to make the Bitcoin blockchain more suitable for smaller payments. He stated:

“Fiat currency will eventually become as passé as trying to pay for coffee with pennies.”

He also stated that liquidating his portfolio would be moving back to the past, adding that he has no interest in doing so. He said:

“I have no interest in selling my Bitcoin. What would I sell it into anyway? Moving from crypto to fiat is like trading shells for gold. It is reverting to the past. I’m thinking long term I’ll use it, spend it, invest it, or just keep it.”

Author Anirudh VK June 16, 2018

David Ogden (Entrepreneur) I agree with these sentiments, there is only one way forward.

David Ogden – Http://markethive.com/david-ogden

The Real Reason Behind Bitcoin’s Price Crash Revealed – Cryptocurrency Today

Bitcoin-Price-Today-What-is-triggering-the-Bitcoin-sell-off

The Real Reason Behind Bitcoin’s Price Crash Revealed -Cryptocurrency Today

Bitcoin investors in the United States are selling off their crypto to pay off capital gain tax.

First-time investors in Bitcoin are faced with large capital gain taxes from the profit they made in 2017. Reports show that they are now selling off quickly before they file their April taxes.

You’ll recall that the IRS made an announcement in 2014 that cryptocurrencies are defined as property and not currency.

The CEO of ARK Invest said in a quote:

“Those who have never paid taxes before are shocked. Many people gained a lot from cryptocurrency last year but currently, do not have enough cryptocurrency to pay taxes for their last year’s gains.”

Also, the founder of OnlineTaxman.com, Vincenzo Villamena said that people have realized that they are stuck with large tax bills. They are either preparing to pay or selling off the cryptocurrency.

How Does Selling Off Cryptocurrency Help People Avoid Paying Huge Taxes?

If an individual buy and sells Bitcoin within the same year, the person will be taxed on short-term capital gains which can be as high as 39% depending on the tax bracket.

Airdrops and Bitcoin mining are also being taxed. However, they are taxed as ordinary income, and so the rate depends on the Individual’s tax bracket. However, when a person holds on to Bitcoin for more than a year before selling, it will only be liable for what the IRS refers to as long-term capital gains. The rate for this kind of tax is significantly lower from about 15 to. 23.8%.

Jun 14, 2018 by Andreas Kaplan

David Ogden – Http://markethive.com/david-ogden

Bitcoin rebounds after recent bout of heavy selling

KUALA LUMPUR: Bitcoin staged a rebound at midday on Thursday, rising to a high of US$6,495 after falling sharply in recent days.

At midday, it was up US$233 to US$6,495.

Earlier Bloomberg reported that Bitcoin extended losses, bringing its four-session slide to as much as 20 percent, as questions mount about whether the world’s biggest cryptocurrency was manipulated during last year’s record price surge.

After rallying more than 1,400 percent in 2017 amid an investor frenzy for digital assets, Bitcoin is down almost 70 percent to around $6,238 as of 4:37 p.m. in New York on Wednesday, from its record high of $19,511 set in December. It traded at a few cents after being launched in 2009.

“Things have changed for Bitcoin and the crypto space,” said Craig Erlam, senior market analyst at online trading firm Oanda Corp. in London.

“There doesn’t seem to be as much hype, or positive news. Every time we get a negative news story now — after a period of consolidation — we don’t see bullish sentiment come in to support it. It’s almost as if people are waiting to sell it.’'

The virtual currency has struggled to reverse a selloff that coincides with negative news, most recently a study of possible price manipulation using the Tether coin. Bloomberg News reported in May that the Justice Department opened up a

criminal probe into illegal trading practices that can manipulate the price of Bitcoin and other cryptocurrencies.

Tether, one of the most-traded cryptocurrencies, shows a pattern of being spent on Bitcoin at pivotal moments, helping to drive the world’s first digital asset to a record price in December, according to research by a University of Texas professor known for flagging suspicious activity in the VIX benchmark.

Questions about Tether and Bitfinex have dogged the cryptocurrency world since last year when Bitfinex lost banking relationships yet continued to operate.

The U.S. Commodity Futures Trading Commission subpoenaed both firms in December, seeking proof that Tether is backed by a reserve of U.S. dollars, as it claims. Tether and Bitfinex haven’t been accused of wrongdoing.

The digital coin has closed below its 50-, 100- and 200-day moving averages for the past 16 days, the longest stretch below those support levels this year.

In other technical measures, Bitcoin’s relative-strength index has fallen below 30, a level often used in equities and some other asset classes as indicating oversold. It typically rises, snapping back above 30, in a matter of days, according to a five-year analysis.

Many of Bitcoin’s closest peers have also tumbled. Ethereum, the No. 2 coin by market value, and No. 3 Ripple have both dropped about 20 percent this week.

“The entire crypto space seems to be taking the hit now,” Erlam said. “For Bitcoin, $6,000 seems to be a support level now. If I’m bearish, I’m desperate to see it break below $6,000.” – Bloomberg

David Ogden – Http://markethive.com/david-ogden

Bitcoin notches two-month low in the wake of cryptocurrency exchange hack

Bitcoin continued to pull back after its initial 10 percent drop over the weekend.
Other major cryptocurrencies, including Ethereum, also saw declines in the last 24 hours.

Bitcoin eased further on Wednesday following its initial drop after the weekend announcement that South Korean cryptocurrency exchange had been hacked.

Other major cryptocurrencies also weakened markedly.

Bitcoin traded as low as $6,455.91 early on Wednesday Asia time, its lowest level since April. Bitcoin pared some of those losses to trade around $6,550.76 by 11:40 a.m. HK/SIN, according to CoinDesk.

Bitcoin had fallen around 10 percent over the weekend following news that South Korean exchange Coinrail had been hacked, with a number of lesser-known cryptocurrencies such as Pundi X counting among those affected. Bitcoin, however, was not mentioned by the exchange in its statements, according to Google translate.

Over the last 24 hours, bitcoin has seen a dip of more than 4 percent, according to CoinMarketCap. So far in 2018, the cryptocurrency is down more than 50 percent.

Chart analysts have indicated that bitcoin's move below the $7,000 mark suggested a speedy recovery was unlikely.

As for other crypto assets, the last day has proven challenging.

Ethereum, the second-largest cryptocurrency by market capitalization, was down almost 6 percent in the last 24 hours, CoinMarketCap data showed. Ethereum stood at $499.54 at 11:40 a.m. HK/SIN, according to CoinDesk.

Ripple was also lower by nearly 6 percent in the last 24 hours, according to CoinMarketCap. It traded at 56 cents at 12:15 p.m. HK/SIN.

Author Cheang Ming 13/6/2018

David Ogden – Http://markethive.com/david-ogden