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Friday, December 14, 2018

The Crypto Markets May be in a Rout, But the Blockchain Job Market is in Full Swing

Although the crypto markets are caught in a persisting bear market, blockchain jobs are in a raging bull market, with blockchain developer job growth topping this year’s LinkedIn Emerging Jobs Report.

The report, which was released by LinkedIn on December 13th, analyzes the fastest growing jobs in the US, and notes that the blockchain industry was the fastest growing job market in 2018.

Crypto Crashed, But Blockchain Still Thriving 

Although the cryptocurrency markets have faltered throughout 2018 and are currently sitting at their lowest price levels since mid-2017, the blockchain development industry is thriving.

The LinkedIn report notes that in the United States, blockchain developer jobs saw 33x growth in 2018, significantly more than the second fastest growing job of machine learning engineers, which grew by 12x throughout the year.

The report notes that within the blockchain development sector, the most widely sought-after skills are knowledge and experience with Solidity (smart contracts), blockchain technology, Ethereum, cryptocurrency, and Node.js.

Within the market, most of the demand for workers with skills and a knowledge base in the aforementioned technologies stemmed from three main companies, including IBM, ConsenSys, and Chainyard, and three main cities, including San Francisco, New York City, and Atlanta.

Although the demand for blockchain developers is incredibly high, the crypto rout has undeniably stagnated this growth, as many companies in the blockchain sector have been impacted by the market crash.

ConsenSys, who LinkedIn notes as being one of the biggest blockchain employers, recently underwent a company restructuring that resulted in 13% of the company’s staff being cut.

The restructuring, which has been dubbed as “ConsenSys 2.0” by the company’s leaders, will result in more rigorous milestones and will lead to increased focus on the projects with the most long-term potential, while the more experimental and risky projects will be cut.

Blockchain Industry Not Going Anywhere

Although the blockchain industry may be starting to feel some pressure resulting from the cryptocurrency market crash, it still has a significant amount of growth ahead of it.

Recently, MouseBelt, a blockchain and ICO accelerator service, funded UCLA’s first accredited blockchain engineering course, which will start in January of 2019. The course will be for undergraduate students with an interest in computer engineering and will be considered by the university as a 4-credit special topics course.

In the past, students have had access to blockchain and cryptocurrency courses through the Anderson School of Management, but this is the first course that is actually being offered by UCLA to undergraduate students.

Although the cryptocurrency market’s current situation looks dire, the growth in the blockchain job market and the advent of new blockchain-centric courses from top universities signals that development in DLT tech, which is inexorably tied to crypto, continues pushing ahead and that the best is still yet to come.

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Cole Petersen

Teen Bitcoin Millionaire: “Bitcoin is Pretty Much Dead”

One of the youngest cryptocurrency success stories has a rather bleak outlook for the leading digital asset, Bitcoin. Erik Finman became a millionaire in his teens by investing money that his grandmother had gifted him, starting as early as 2011.

At the height of the Bitcoin bull market of 2017, Finman’s stack was worth an impressive $4 million. There is no indication just how much much of this he still holds, however.

Erik Finman: Bitcoin and Litecoin Dying, Ether, BCH, and Zcash Show Promise

Erik Finman hit headlines this January for his remarkable story. Starting in 2011, the then 12-year-old was buying cryptocurrency with some money his grandmother had given to him. According to a report in Market Watch, by catching on to the technological innovation early, the teenager was able to turn just $1,000 into over $4 million.

Despite being the cause of his success, Finman is now of the opinion that Bitcoin is in trouble:

“Bitcoin is dead, it’s too fragmented, there’s tons of infighting I just don’t think it will last… It may have a bull market or two left in it, but long-term, its dead.”

Interestingly enough, much of the infighting within Bitcoin has actually died down since the August hard fork last year, which created Bitcoin Cash. This is because many of those arguing for scaling by increasing the size of the blocks themselves left the community to support and use the offshoot currency, evangelised by Roger Ver and Craig “Fake Satoshi” Wright.

Bizarrely, the teenage investor believes that Bitcoin Cash is actually a better bet than the original Bitcoin. He told the publication that it had great technology but had been marketed terribly. It seems strange that Finman would critique Bitcoin’s infighting and be more optimistic about Bitcoin Cash when it was the latter that has just undergone a far uglier hard fork than that of last August. This recent incident involved threats of 51% attacks and plenty of other mudslinging.

Perhaps Finman simply has not been paying the space quite as much attention as he once did since his portfolio exploded into seven figures. Perfectly understandable given his age but it still seems odd that he thinks he has any authority on the matter given how detached his statements are from reality.

As mentioned, Bitcoin’s infighting has calmed immensely over the last year and a half. Infrastructure development is occurring at an unbelievable pace too. This includes institutional offerings from the likes of Bakkt and Fidelity, as well as improvements to the protocol itself in the form of Lightning Network. This is literally night and day to what is happening over at Bitcoin Cash right now.

Other projects that Finman believes have a better chance of survival are Ethereum and Zcash. Meanwhile, he states that Litecoin is certainly all but toast:

“Litecoin has been dead for a while,” he said. “It’s like when the sun is going down and there’s that eight minute period just before it goes dark. Litecoin is in its seventh minute.”

Related Reading: Crypto Community Responds to Fake Satoshi’s “F**k You” Email to Roger Ver

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Rick D.

Bakkt and Intercontinental Exchange CEOs Weigh in About Bakkt

Bakkt CEO, Kelly Loeffler, and the Intercontinental Exchange chairman, Jeff Sprecher, recently spoke to MIT Media Lab’s Michael Casey at CoinDesk’s Consensus: Invest Conference. The chat was broadcast via the “Inside the ICE House” podcast earlier today.

The two CEO’s talked in depth about their plans for the much-anticipated Bakkt platform, including what makes it different to other products already out there today, and why it will only focus on Bitcoin to begin with.

Will Bakkt’s Federally Regulated Price Discovery be Good for Bitcoin?

The conversation between Loeffler, Sprecher, and Casey began with a simple enough question: Does price matter to you?

Loeffler responded first that it made little difference to the use of digital assets what they were priced at. The CEO went on to muse about the future of crypto more generally, particularly set within the context of the current bear market:

“When I think about what we’re doing at Bakkt what our peers in this space are doing, what all of you in this room are doing, I think about the headline’s today, ‘Will Digital Assets Survive?’ and I’d say the unequivocal answer is ‘yes’.”

This led smoothly on to perhaps the most oft-repeated topic of conversation during the presentation. Both Loeffler and Sprecher hold that the most important thing Bakkt would bring to digital currency was fully regulated price discovery for the first time ever. This, the pair agreed, was the primary focus of the platform. Sprecher stated:

“We develop systems where there can be transparent and competent price discovery.”

Loeffler added that institutions needed certainty before they would take the plunge into the world of cryptocurrency. One way of achieving such certainty was by being fully regulatory compliant at the Federal level – something that Bakkt is keen to achieve.

Another way to inspire confidence from the various institutions that the ICE networks with is by having a price discovery method that is free from manipulation. Since Bitcoin is the only digital asset currently recognised by the US government as a commodity, it is uniquely placed to be offered to institutions on such a regulatory compliant platform.

How is Bakkt Different From Other Products Around Today?

The conversation moved to addressing how the Bakkt platform would differ from other exchanges or financial products, such as the CBOE and CME futures contracts launched last December. Loeffler spoke first on the topic:

“At ICE, we’re the largest exchange operator in the world, we operate a dozen exchanges across US, Europe, Asia, Canada, clearing houses. So, we’re connected institutionally around the world to the largest traders of all asset classes.”

Sprecher added that the Bakkt exchange platform will also use its own clearing house. Since everything is going to be entirely pre-funded, there is expected to be far less leverage risk. This clearing house will has also have its rules set by a risk committee comprising of some of the US’s largest financial institutions. These are the same rules that will be taken for the approval of the US government. The hope is that the acceptance of the rule set from such prestigious names will encourage them to offer their approval. This in turn will inspire confidence in the Bakkt platform for investors.

The conversation then moved to Starbucks’s involvement in Bakkt. Loeffler stated that they were also highly interested in helping to put digital assets to use in the real-world. This is something Starbucks was interested in exploring too, so the partnership made a lot of sense. She added that other big names had expressed interest in working with Bakkt in a similar capacity too:

“Since that announcement we’ve heard from others that want to do that.”

Recommended Reading: BitPay CEO: Fidelity and Bakkt Will Drive Next Major Bitcoin Rally

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Rick D.

Bitcoin Sets Fresh 2018 Low at $3,200, Altcoins Plunge

Following its recent period of instability, Bitcoin has now plunged to new 2018 lows and has sent the altcoin markets spiraling downwards. Today’s drop has led the overall cryptocurrency market capitalization down to $102 billion, a level not seen since August of 2017.

At the time of writing, Bitcoin (BTC) is trading down nearly 6% at its current price of $3,230, down from its 24-hour highs of $3,430. Bitcoin’s previous 2018 low was set on December 7th when it fell to just under $3,300.

Analysts Expect Bitcoin to Fall Below $3,000

The market’s current instability is leading to a general consensus among analysts that it is only a matter of time before Bitcoin falls below the important psychological price level of $3,000.

While speaking about Bitcoin’s current price action, Nick Cawley, an analyst at Daily FX, said that based on his technical analysis, Bitcoin’s short-term price action is leading it towards $2,970.

“Bitcoin looks set to fall below $3,000 in the short-term with the $2,970 Sept. 15, 2017, swing-low the next target. Below here, horizontal support at $1,760 off the July 18 [2017] low comes into play in the longer-term.”

DonAlt (@CryptoDonAlt), a popular cryptocurrency analyst on Twitter, told his nearly-80 thousand followers that he also expects BTC to dip into the $2,000 region, with a good buy target being at the $2,700 level.

“As BTC is approaching the target of the 2014 fractal the targets of most people change from 3k to 1k and even lower. I still think 2.7k is an excellent place to buy if we should go there,” he said, further adding that right now is not the best place to add new short positions.

Altcoins Plummet Amidst Bitcoin Instability

Bitcoin’s instability has led the vast majority of altcoins to plummet, with Bitcoin Cash and Stellar Lumens leading today’s market plunge.

At the time of writing, Bitcoin Cash (BCH) is trading down 15% at its current price of $82, setting a fresh all-time-low. Ever since Bitcoin Cash’s hard fork event on November 15th, the cryptocurrency has been spiraling downwards, and is showing few signs of fundamental strength as it drifts lower.

BCH’s hard fork offshoot – Bitcoin SV (BSV) – also dropped significantly today and is currently trading down nearly 11% at its current price of $74.8. BSV is currently behind Bitcoin Cash’s market cap by over $100 million.

Stellar Lumens (XLM) is currently trading down over 11% at its current price of $0.098, and just set a new 2018 low around its current price levels.

XRP is currently trading down nearly 6% at its current price of $0.287 and is trading at levels not seen since this past September. It is important to note that XRP is still trading above its 2018 low, which was set at approximately $0.24 this past August.

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Cole Petersen

CoinShares Exec: China Crypto Plan Could Make Dystopian Future a Reality

Bitcoin was designed in the wake of the 2008 global economic crisis as a way to take control over money away from central authorities such as governments, banks, and other traditional systems. The decentralized design could also prevent communist countries like China from establishing control over their citizen’s money.

However, the very technology powering crypto may be arming central authorities with even more control over the population and their money, which CoinShares Chief Strategy Officer Meltem Dimirors says may “slowly” be making her “dystopian nightmares” a “reality.”

Government Control Undermines Crypto’s Original Intention

In a tweet this morning, CoinShares Chief Strategy Officer and Head of Treasury Meltem Demirors shared her fears that recent moves by governments like Venezuela and China, could be bringing her “dystopian nightmares” closer to “reality.”

Related Reading | Venezuelan President Orders Banks to Adopt Petro

Demirors is referencing both Venezuela forcing its citizens to transact with the country’s native, oil-backed cryptocurrency token, and China’s plan to introduce its own digital currency that it will use to monitor and control the usage of its citizens.

China To Eliminate Cash, Control The Public Through Digital Currency

Not only will China begin using their own digital currency, but according to Fan Yifei, the deputy governor of China’s central bank, the People’s Bank of China (PBoC), the new digital currency will also entirely replace cash. Without fiat paper currency Chinese citizens will have every transaction closely monitored and will be subject to the government’s control.

Former PBoC governor Zhou Xiaochuan set the project in motion before retiring earlier this year, as a means to avoid China relying on Bitcoin or other current cryptocurrency protocols. Since then, the PBoC has registered nearly 80 patents related to the native cryptocurrency they are developing.

Related Reading | China Could Destroy Bitcoin to Make an Ideological Statement

Patents suggest that both businesses and individuals alike will have to convert all of their yuan into the new native digital currency using a mobile wallet. Yifei published an article earlier in the year that outlined that banks would be required to submit a daily log of transactions, which would allow the Chinese government to keep tabs on every transaction every individual or business makes, even capping the amount of transactions any individual could make on a given day.

China’s control extends beyond their own native cryptocurrency as the country has outright banned cryptocurrency exchanges, events, and more.

China has even been said to have “strong motive” and “capabilities” to destroy Bitcoin entirely. In a frightening report, researchers from Princeton University and Florida International University called China the “most powerful potential adversary to Bitcoin.”

Since Bitcoin is in “ideological opposition” to China’s communist policy, the country could be motivated to attack it. Worse-yet, much of the Bitcoin network’s hash power is centralized in China due to the abundance of miners there taking advantage of low energy costs.

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Tony Spilotro

Crypto ICO Price Continues to Fall, Likely Due to Growing Regulatory Pressure

Blockchain and crypto projects that raised millions of dollars via tokenized crowdfunding means are now lining up to return their capital to their original investors. Because apparently, they were not allowed to raise funds in the first place.

The Securities and Exchange Commission (SEC) has gone after these startups for reportedly violating existing securities laws. The US regulator found irregularities in the way companies raised funds, mainly by approaching average Joes instead of sophisticated, accredited investors to raise capital. As a result, the commission issued heavy penalties against the accused blockchain projects, which include the order of returning funds to the investors.

Even Big Crypto Projects Struggling

It could be one of the reasons why even the most genuine startups could see massive declines in their token values. The funds that backed these unregistered assets may no longer be there to return them. Even the hedge fund managers that incorporated them into their crypto portfolios at the first place are now doubtful of their future.

Dan Morehead and Joey Krug, co-chief investment officers of Pantera Capital Management, revealed in their newsletter that their fund invested in 25% of the blockchain projects that violated the US securities law, adding that they may have to refund their backers.

“If any of these projects are deemed to be securities, the SEC’s position could adversely affect them,” they wrote. “Of these projects, about a third (approximately 10 percent of the portfolio) is live and functional and, while they could technically continue without further development, ending development would hinder their progress.”

The funds could also end up paying the bills for offering unregistered securities in their portfolio. In such a scenario, Pantera, which posted gains of 60% amid a crypto crash, therefore may need to shell out a considerable portion of their accumulation as a refund.

An instance that guides to such a scenario is CoinAlpha Advisors LLC. The fund manager last week was slapped with a $50,000 fine by the SEC after the regulator caught it selling unregistered securities.

Regulatory Backlog

The situation related to the future of the US ICO industry is likely to get worse. It would be difficult to predict the coins that have made into the SEC’s hitlist, but the growing scrutiny would deter new startups to launch businesses in the grey area of cryptos. That said, the market could be eyeing further losses as the new year approached, indicating a head down towards the best-possible bottom.

Nevertheless, a clear washout of unregistered ICOs would eventually make space for a new wave of startups. With accredited investors taking them for a ride, there would be fewer cases of frauds that otherwise had hampered the growth of the ICO sector, anyway. A crash followed by a stable uptrend is the best outcome of all this.

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Davit Babayan

CEO: Crypto Plunge is Healthy, Bitcoin Remains a Great Investment

Since the bear market hit the crypto ecosystem head-on, investors exposed to this helter-skelter asset class have been deterred at large. Not only have the value of cryptocurrencies, such as Bitcoin (BTC), declined drastically, but hype and interest surrounding this market have largely been exhausted. Nevertheless, there remain many libertarian-leaning zealots that will hold on to cryptocurrencies, even until the bitter end. And as such, it should come as no surprise that Bitcoin’s fanatics have come to its defense at a dreary time.

Potential Payoff In Crypto Presents “Nice Opportunity” 

As bears have struck with no holds barred, Bloomberg TV has called upon a number of crypto’s eminent insiders to get an inside scoop. Most recently, the famed financial news outlet brought on Eric Ervin, the chief executive at U.S.-based Blockforce Capital.

Subjecting the CEO to answering run of the mill inquiries, anchor Emily Chang asked what Bitcoin’s 82% year-to-date drawdown has meant for crypto en bloc. Ervin noted that his firm, like many other crypto-centric asset managers, regards cryptocurrencies as a long-term opportunity, rather than the short-term money grab that crypto’s skeptics paint it to be. More specifically, the cryptocurrency proponent likened blockchain-based assets to the venture capital ecosystem, explaining that investing in cryptos should be addressed with a three-year time horizon. Ervin elaborated on crypto’s prospects as an investable instrument, stating:

“Because it is so inefficient, and there are so many operational risks that are yet to be solved, this creates an opportunity for investors that are willing to wade into the shallow end and start to invest in the asset.”

Echoing comments from a multitude of his fellow industry pundits, the Blockforce representative then touched on how cryptocurrencies accentuate the hallmarks of an asymmetric risk profile. Ervin added that this emerging asset class, often likened to the Internet in the 90s, has the potential for copious upside, before maintaining that cryptocurrencies provide a ‘nice opportunity” for investors who can play their cards right.

Just days ago, on two distinct mainstream media segments, Travis Kling and Mark Yusko, two institutional investors turned crypto diehards, also lauded Bitcoin as a viable medium of portfolio diversification, even for investors deemed conservative and pro-traditionalist. Kling, taking to the media network of crypto-friendly TD Ameritrade, told viewers that while BTC is a “multi-year, multi-decade” play, its return on investment proposition makes the cryptocurrency a compelling investment.

In a similar manner, Yusko, the founder of the overarching Morgan Creek brand, told CNBC’s Power Lunch that for investors pursuing asymmetrical exposure to assets, crypto assets are a prime vehicle to choose.

Bitcoin Crash Was “Healthy,” Brought In “Real People”

When queried about Bitcoin’s crash, Ervin made it clear that such price action was “healthy,” as the aggregate value of all circulating cryptocurrencies has only fallen to the levels seen in early to mid-2017 — not an apocalyptic crash, that’s for sure. The Blockforce chief also alluded to the belief that the crash weeded out bad actors, as he explained that “real people,” many of which are seeking to reinforce industry infrastructure, remain as crypto’s only survivors.

In closing, the Bloomberg host, attempting to glean knowledge regarding the Bitcoin exchange-traded fund (ETF) application from VanEck, SolidX, and Cboe Global Markets, asked Ervin on his expectation for the upcoming product. Almost as if he was poised for such a question, Ervin noted that although he expects for a crypto-backed ETF to go live eventually, the acceptance of VanEck’s appeal will likely fall a few feet short of its mark.

Related Reading: SEC Commissioner Warns Investors Against Putting Too Much Hope into Bitcoin ETF

While some cynics may bash industry participants like Ervin as naive,

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Nick Chong