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Current State of The Crypto Market (February 10th, 2019)

Hackers: The hackers who earlier this year breached the New Zealand-based cryptocurrency exchange Cryptopia have already managed to cash out over $3.2 million through major crypto exchanges, $2 million of which through the popular EtherDelta decentralized exchange.  According to data shared by Elementus, the hackers have also cashed out significant amounts through Huobi, Binance, and Bitbox, among other exchanges. These likely have know-your-customer (KYC) checks in place for such large amounts, meaning it may be possible to identify them.  As for the funds cashed out through EtherDelta, these are likely going to be untraceable in the future, as EtherDelta is a decentralized cryptocurrency exchange that doesn’t require KYC or anti-money laundering (AML) checks. As covered, its founder has been charged for operating an unregistered security exchange.

 

The IOTA community was able to help gather enough evidence to allow authorities to catch an alleged hacker who stole over $11 million MIOTA tokens in early 2018. The suspect was apprehended by German Police and Europol at the end of January.  IOTA said in a blog post that it was “proud to see collaboration between so many different entities” that led to the arrest of a 36-year old man from Oxford, England. The range of the collaboration encompassed the IOTA community, especially the people on the Discord #support channel, the HelloIOTA forum, German Police, as well as crypto exchanges which provided valuable information.  It was reported, on January 30th, that most of the roughly $11 million in the company’s cryptocurrency stolen from 85 investor’s wallets have been found. This was followed a week later by the arrest of the purported hacker, who is said to have been working alone using seed-generators found online to steal the funds.

 

Bullish Key Players:   Six fintech experts recently shared their view on the price of BTC. They predicted that 2019 would be a better year for the crypto after the 2018 debacle.  The experts, who were surveyed by Finder said that BTC could see a huge price surge in 2019. They predicted that prices would rise by as much as 84%.  The co-founder of Finder.com.au said that millennials were more willing to invest in digital assets. Besides that, he noted that their investing habits were different from those of their parents. Additionally, he noted that the major barrier to using crypto was lack of knowledge. About 11% of all respondents said that it was too complex for them.

One of the experts, Ben Richie, Digital Capital Management COO stated that there is going to be a bullish trend that will see the top value cryptocurrency hit $9,500 before the end of 2019. Also, he said, the crypto market might see a decoupling of altcoins from BTC this year.

Richie stated that on-ramp and off-ramp of purchasing cryptocurrencies would see improvement in the year 2019 especially due to the Bakkt and Fidelity Group entering the market. Though it will be a catalyst, he still did not see many institutional fund or investors in the crypto market this year.

Another expert, a bitcoin developer, Jimmy Song gave a conservative opinion that the crypto market will bull to $6,500 per BTC in 2019, and the market cap to reach of $117.2 billion. Song said that they are a more or less random number and this is hard to predict without knowing the news that comes out between now and then.

Joe Raczynski, a legal technologist, and futurist stated that the top value cryptocurrency could see a bullish trend to $8,000 by December 31 of 2019. Joe notes that BTC is entering a new phase that could see institutional investors. Joe predicted the possibility of a dramatic shift in the economy, which is noted as slightly more likely than otherwise, which could make Bitcoin become a haven for investors. He stated that he feels that the economy will start to change in 2019 and this will impact BTC positively.

 

 

Banks & Institutions:  An important development came with the news two weeks ago that Fidelity will offer a digital asset trading service. The sixth-biggest fund manager in the world announced a project catering specifically to the trading demands of large institutional investors in which, most importantly, they will provide services such as “institutional-grade custody.”

At the same time, a number of providers that started as crypto companies have earned regulatory status as qualified custodians, allowing them to also go after compliance-sensitive institutional investors as clients. These include BitGo, which received a charter from the South Dakota Division of Banking in September and Coinbase, which only last week received a similar qualification from the New York Department of Financial Services.

Meanwhile, the Intercontinental Exchange, or ICE, which owns the New York Stock Exchange, is preparing to launch Bakkt, a new bitcoin futures trading service – likely in December, the company said last week. The key difference with the futures contracts that were launched late last year by both the Chicago Mercantile Exchange and the Chicago Board of Options Exchange, is that Bakkt’s will be for physical delivery rather than merely a cash-based settlement. That will, in turn, require custodial and other services.

There’s a pattern to all this: new custodial and trading services being offered by large, regulated entities, all in preparation for an expected influx of new securities that use smart contracts and blockchain technology to manage transfers of more traditional assets. All are aimed squarely at the expected arrival of institutional investors into the crypto world.

 

Adoption:   This week, major browser operator Opera has integrated a feature to purchase crypto into its Android app less than three months since announcing its plans to further explore blockchain technology.  With a partnership with Safello, a European crypto exchange, users are now able to purchase cryptocurrencies directly from the Opera browser.  The announcement of Opera comes in a period in which other large-scale technology conglomerates like Samsung are rumored to be in the process of integrating native crypto support.

Hennes & Mauritz, H&M distributors will now use cryptocurrency e-commerce platform Chimpion for cryptocurrency payments. H&M distributors deal in cost- effective lighting. Also, these include replacement ballasts, lamp holders, and accessories for lamp holders. Moreover, the platform will reportedly accept payments in Ethereum (ETH), Litecoin (LTC), Bitcoin Cash (BCH), Dash (DASH) and Bitcoin Diamond (BCD).  The decision comes after a realization by the company, which being that cryptocurrencies help eliminate the financial barriers and allow for a global outreach.  In a press release by H&M CEO and Founder Herb Needham he stated the acceptance of cryptocurrencies allows the company to “pass on even more savings to its customers” by way of “drastically reduced transaction fees and freedom from chargebacks.”

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