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‘Better as friends’: DeFi protocols Yearn and Cover announce cessation of merger

March 5, 2021 by Blockchain Consultants

Decentralized finance (DeFi) protocols Yearn Finance and Cover have announced today the end of a protocol merger process initiated in November last year. 

The two protocols were initially linked during a spree of a half-dozen Yearn acquisitions, mergers, or collaborations, the exact term depending on the project. The split comes as a surprise to many, given that Cover, a protocol that provides coverage or insurance for DeFi deposits, was a natural fit for yield vault provider Yearn. The teams had also collaborated in crisis situations in the past, such as when Cover experienced an “infinite mint” hack in late December 2020.

We have decided to end the previously announced merger process of Yearn and Cover. Both protocols will continue to operate independently. yVault depositors who have previously purchased Cover protection are unaffected by this.

— yearn.finance (@iearnfinance) March 5, 2021

Following the hack of Yearn’s DAI vault earlier this month the team also announced that coverage from Cover would become standard across all vaults. According to Cover core contributor “DeFi Ted”, Yearn will now be moving forward independently with their own insurance offering. 

Both teams confirmed that users can continue to purchase coverage for Yearn deposits, and that current coverage will be unaffected.

Comments from both teams indicate that the cessation was an emotional, potentially snap decision — one rooted in potential conflicts of interest related to Cover’s new protocol, Ruler.

Emotional responses

In a since-deleted Tweet, Yearn founder Andre Cronje weighed in in the split, portraying it as a breach of trust:

“Personally, this was very sad to see. I had very high regard, trust, and faith in the Cover team. Lesson learned. Wont trust them again.” 

He’s since followed up with another, similarly cryptic Tweet: 

Deleted my previous tweet. It was an emotional response. Twitter isn’t the place for that. I often forget ethics and money don’t mix.

— Andre Cronje (@AndreCronjeTech) March 5, 2021

DeFi Ted told Cointelegraph that the two teams had recently met to discuss providing coverage for Yearn’s vaults, and the Yearn representatives reached out shortly after to reveal they would be building their own insurance/coverage offering. 

Ted added he was personally “a bit blind sided” by the decision, which he says was given with four hours notice prior to the Yearn announcement on Twitter. On official social channels Cover team members characterized the split as a “difference of opinion,” and likened it to a romantic relationship in which both parties discover that they’re “better as friends.”

“Honestly feel a little lost right now sir,” said Ted.

A core Yearn operations contributor declined to comment.

Can’t fork and be friends

Some community members have speculated that Yearn’s decision is related to the launch of Ruler Protocol, a lending solution from core Cover contributors that kicked off a liquidity mining program this week. The Yearn ecosystem already includes one lending platform, CREAM Finance, and core contributor “banteg” has hinted on Twitter that the team isn’t appreciative of competitive overlap from collaborating teams:

Friends don’t fork friends

— banteg (@bantg) January 21, 2021

Ted confirmed to Cointelegraph that the split is related to Ruler, but said that there’s “no conflict” between the various protocols, and instead that there was concern from Yearn about the Cover team “running two projects.” 

“In fact, we have a great relationship with Leo and CREAM, don’t be surprised to see us do something with them,” he said.

The price for Cover’s native governance token, $COVER, has plummeted on the news, down 35% to $605 at the time of publication.

Nonetheless, Ted and other team members say they remain resolute in building, and that the split is just another chapter in what has been a tumultuous history featuring multiple forks and re-launches. 

“The COVER journey has definitely been unique.”

‘Better as friends’: DeFi protocols Yearn and Cover announce cessation of merger

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Filed Under: blockchain technology Tagged With: Cover, DAO, DeFi, developers, finance, founder, hack, insurance, Merger, mining, money, news, opinion, other, twitter, us, Yearn

Meeting Over Regulations Set Between Key Biden Staff And Blockchain Association

March 5, 2021 by Blockchain Consultants

The Blockchain Association stands as a crypto advocacy group based in the US, and has started to take part in the age-old practice of lobbying. In particular, it’s meeting up with various key figures within the Biden administration in order to advocate for more favorable regulations within the crypto space.

Crypto Lobbyists Doing Their Thing

Kristin Smith stands as the executive director of the Association, and gave a statement to Fox Business about the matter. In this statement, Smith highlighted that the Blockchain Association has already met with certain key figures within the Biden Administration, or are otherwise scheduled to meet them in the future.

These high-ranking officials of the White House include names like Wally Adeyemo, the former BlackRock executive, and Deputy Secretary nominee, as well as Janet Yellen, the Treasury Secretary. Alongside this, various representatives of the Treasury Department have been in talks with the Blockchain Association as well.

crypto

Trying To Fix Mainstream Crypto Image

The Association’s biggest aim with these talks, according to the public statement, is to have the Treasury Chief gain a greater understanding of the value of crypto. Smith cited a comment Yellen made in the past, declaring that the primary use case for crypto was illicit financing, and Smith states that it’s the Association’s top priority to change this view.

Yellen herself has seen quite a bit of dislike from the general crypto community. Granted, she didn’t really make that a difficult prospect after declaring that was an extremely inefficient means to conduct any type of transaction, declaring that it wasn’t used as a transaction mechanism all that much.

Using Tools Just For Governments

It should be noted that Yellen isn’t against Decentralized Ledger Technology (DLT), just the general decentralized cryptocurrencies. Yellen had repeatedly shown interest in the centralized use case for DLT. In this angle, Yellen declared it would be very beneficial for the Dollar, offering quicker and safer, not to mention cheaper, means of payment as opposed to fiat.

Adam Traidman stands as the CEO of the BRD crypto wallet. In his public statement, he highlighted how the crypto space at large is trying to work with the highest echelons in the Treasury command chain as possible. In a statement, he highlighted that many in the crypto space aren’t even bothered by compliance or regulations. However, he advocated for a less stringent regulation just for now to spur innovation and jumpstart mainstream adoption.

Meeting Over Regulations Set Between Key Biden Staff And Blockchain Association

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Filed Under: blockchain, cryptocurrency Tagged With: Adoption, Biden, blockchain, Business, ceo, chief, Compliance, crypto, Cryptocurrencies, cryptocurrency, data, decentralized, Director, DLT, executive, fiat, Janet Yellen, Ledger, Mainstream, Market, Regulation, Space, Technology, Trading, us, view, yellen

The reformed Bitcoin Maxi who saw the light: Erik Voorhees

March 3, 2021 by Blockchain Consultants

“We felt like we were doing God’s work,” explains cryptocurrency payments pioneer Erik Voorhees as he recalls trying to convert the unbelievers in the early days of Bitcoin.

The man whose gambling platform SatoshiDice was once responsible for half of all Bitcoin transactions, is now an elder statesman of crypto and the CEO of the ShapeShift exchange.

He remembers Bitcoin being written off as a joke at the Money 2020 conference in Las Vegas back in 2012. At the time he was working for BitInstant, one of the first Bitcoin exchanges, and they had a booth right next door to PayPal.

“I remember the PayPal people nearby kind of snickering at us. A couple of them had maybe heard of Bitcoin. If they’d even heard about it, it was a total joke — a stupid scam on the internet, or something. It was a totally unproductive conference.”

History has not been kind to the snickerers and scam-sayers, many of whom have since been converted. In 2020, eight years after the conference, Paypal finally joined the fray, enabling users to buy and sell crypto, and it will soon add it as a method of payment at 29 million merchants.

Voorhees spread the gospel of Satoshi at the conference alongside Charlie Shrem and Roger Ver. Shrem was the founder of BitInstant, viewed by some as a martyr to the cause after serving two years in prison on a case related to an exchange user reselling Bitcoin on the darknet marketplace Silk Road. Ver was perhaps the biggest believer of all, earning the nickname ‘Bitcoin Jesus’ for his charismatic promotion of the currency.

“In terms of proselytizing, Roger was the absolute best. He was a total maniac about it” Voorhees recounts with a chuckle.

“Even for Charlie and I, who were very much supportive of the general sentiment, It was pretty overwhelming and just incessant.”

“Everyone that works at a startup feels a little bit like they’re changing the world, that they have this huge mission, and certainly every company tries to amplify that,” he says, being a CEO himself. But for Bitcoiners, Voorhees clarifies, “it is really a ‘change the world’ kind of thing, and to change the world on a fundamental level. It’s to change the institution of money itself — that is a profoundly tall order.”

Vorhees explains that he sees Bitcoin as nothing less than revolutionary:

“It’s not just a better user-interface for the money that people had before. It’s a different type of money that changes government, changes culture, changes social and economic relationships on a very very deep deep level. That’s why it’s taken so long to to catch on, to get recognized, because it is trying to move into such an entrenched institution.”

It’s 2012. @ErikVoorhees @rogerkver and I decided to pool our money together for the first #Money2020 event. We told them we wanted the best booth we could afford, but we needed to be next to the @PayPal booth so we can show the world OUR financial system!

Welcome, Paypal! pic.twitter.com/5BzvQDfvFb

— Charlie Shrem (@CharlieShrem) October 21, 2020

Libertarian roots

Now 35, Voorhees spent his early ‘90’s childhood in the mountains of Colorado before moving to the University of Puget Sound near Seattle in 2003. He studied international economics and business but doesn’t really feel like he learnt either.

“In the entire major of economics, though I had courses in the history of economic thought, I never learned about the Austrians,” he says, referring to the Austrian School of economics. Often ignored by mainstream Keynesian economists, Austrians are obsessed with things like hard money and decry unbacked fiat currencies so they have been embraced by gold-bugs and the Bitcoin community, which is after all, often called ‘digital gold’.

A freshly minted graduate in 2008, Voorhees left to pursue adventure in Dubai where “anyone with a college degree could immediately get a job, because they were growing so fast.”

Working as a marketer for a real estate agency, he watched from a distance as the world he thought he knew began to buckle under the weight of the unfolding Global Financial Crisis. Dubai did not feel its effects until half a year later, he recounts, describing the intervening time as “this very weird period where Dubai was going through this massive economic boom, and the rest of the Western world was falling apart.”

From this desert oasis spared from the global drought, the business and economics graduate “started really understanding money on what I felt was a very fundamental level.” For Voorhees, the story of money is a simple one: “money emerges as the good that is bartered for most frequently.” That used to be gold and is currently fiat money, but it could just as well be something else, if a more useful and efficient money was embraced.

Upon this realization, Voorhees took on a “very strong aversion to fiat currency and to government control of money” because as a believer in a market economy, he felt that no government should control the price or distribution of any goods. “Money was actually the most important good of all, and thus most important to not be centrally planned. And yet it was even in, you know, allegedly capitalist economies,” he says.

“A capitalist economy that has a government-managed money system seemed completely antithetical, but I didn’t have any answers or solutions to that other than some kind of return to the gold standard, which seemed somewhat anachronistic.”

Voorhees returned to Colorado after two years abroad, soon moving to New Hampshire to join The Free State Project, an organized political migration which he describes as “a multi-decade initiative to move 20,000 radical libertarians to one small jurisdiction [New Hampshire] to hopefully have an outsized influence on the political structure.” It was there, in the company of fellow radical libertarian political activists, that Voorhees encountered Bitcoin in 2011.

“At that point I got completely hooked, and a year later ended up leaving New Hampshire and moving to New York to join Charlie Shrem at BitInstant.” There, he took the reins of marketing as employee number three.

It was around that time that Charlie Shrem, Roger Ver, and Erik Voorhees — each of whom would go on to become crypto-luminaries in their own right — pooled their money together to set up a Bitcoin booth at the Money 2020 conference in Las Vegas. “We needed to be next to the PayPal booth so we can show the world OUR financial system,” Shrem recounted. Vorhees says they failed to convert anyone to Bitcoin at the conference despite their best efforts.

Belief in false profits

Vorhees admits he used to be a Bitcoin Maximalist, a believer in the one true coin who rejected all false currencies. “I used to be a maximalist. Obviously when I got into Bitcoin, it was kind of the only coin,” he says.

“As other coins came out I dismissed them, scoffed at them, and generally didn’t like them because I felt like they were a distraction from the important project.”

Though he tried to focus on Satoshi’s vision, the new projects started gnawing at him and he realized that many of them “were doing things that Bitcoin wouldn’t do or couldn’t do.” By mid 2014, his conversion was in full swing.

“My whole mindset began changing. One of the most important things about Bitcoin is that it is decentralised. And it seemed to me antithetical to have a decentralized digital economy where there is only one chain — you know, one code base, one chain, one set of economic rules. It seemed very appropriate that you would get multiple different digital assets, and that was actually part of the decentralization, part of the virtue of Bitcoin was that Bitcoin isn’t the only thing there.”

He tempers this by adding the usual provisos — most tokens are garbage, many are scams, a majority will fail. “It’s only a minority of them that are interesting, but a minority is a lot more than one.”

ETH Folks… try not to become to Binancechain what the Bitcoin Maxis are to Ethereum 🙏

— Erik Voorhees (@ErikVoorhees) February 19, 2021

He still has empathy for his “shortsighted” maximalist peers, who he sees as victims of human nature’s tendency toward tribalism, which expresses itself in lots of ways, “Certainly it expresses itself in religion. And it has expressed itself in crypto, and some portion of people- their mind twists itself into complete advocacy of one flag and complete derision of all others.”

“[It’s] a group psychological phenomena and I don’t know how that stops, but I do think it is really harmful for the growth of decentralized digital finance generally.”

Gambling with Satoshi’s dice

Only a year after learning about Bitcoin, Voorhees launched Bitcoin-based gambling site SatoshiDice in 2012, which took the young crypto community by storm.

“On Reddit, this guy posted that he had created this casino-like mechanism where there’d be this dice roll, and based on the dice roll, a user would either get their coins sent back or lose them. I tried it, and there was magic in it immediately […] So I started working with him.”

This was groundbreaking because “it allowed any person in the world to place a bet by sending a Bitcoin transaction” no matter where they were from or how their local laws governed online gambling.

What’s more, the player did not need to trust SatoshiDice, because “it was provably fair,” meaning that it worked like a transparent machine where all odds and inner workings were open for anyone to inspect. Governments around the world have various commissions to regulate and audit gambling operations, but SatoshiDice’s function potentially made such organizations obsolete, powerless, or both.

“SatoshiDice showed you what the odds were. It was transparent with the odds, and you could prove that the rules were fair.”

The simple, trusted, and permissionless nature of SatoshiDice brought huge success to the platform. Within months of launch, the game was responsible for as much as half of all Bitcoin transactions.

SatoshiDice had an unofficial IPO on the MPEx exchange, a sort of Bitcoin stock market where unregistered Bitcoin companies offered shares and paid dividends denominated in BTC. These were the forerunner of the ICO boom several years later, and attracted similar attention from authorities for breaking securities laws.

Though the casino was “making a tonne of money,” it was also overwhelming as Voorhees felt his job of “running the world’s biggest Bitcoin casino” was distracting him from his greater calling of preaching the good word of Satoshi. Despite ongoing growth, he reluctantly sold the business in 2013 for 126,315 BTC which was then worth $12 million. That would be a cool $6.25 billion today.

Fighting the system

Voorhees did not enjoy calm for long, as the US Securities and Exchange Commission (SEC) soon came after him for making a public offering of unregistered securities. Voorhees considered this unfair, seeing that his investors had made exponential returns. He ended up settling for $50,000.

“That was nine months of total misery, dealing with them. If I didn’t despise the government before, I certainly did it after that. It was such bullshit.”

A core value of his is that people should be free to transact with each other voluntarily, and that no government agency has the right to come in between them. In his worldview, “institutions and government exist purely to curtail people’s power over money,” whereas “crypto gives people total economic power to make transactions in any way they wish, and no one can stop it.” As Voorhees sees it, these two forces will inevitably clash.

Voorhees’ company Shapeshift allows users to trade cryptocurrencies without identity verification. Things were not always that way — in 2018 Voorhees says his company fell under the same rules as traditional banks and therefore had to implement Know Your Customer, or KYC, identity verification procedures, making anonymous transactions impossible. “That was absolutely miserable. Our customers hated it. I hated it.”

But by 2020, decentralized exchanges (DEX’s) which allow users to trade without depositing their funds with a third party were gaining ground and made it possible for Shapeshift to reorient its business and re-align with its libertarian values. All KYC was abandoned, and the platform became a gateway for users to trade on various DEX’s. “I had learned with Satoshi Dice that an economic relationship didn’t need anything other than a public key to send in a transaction, and anything else could be based around that,” he says.

Voorhees says that his opposition to KYC is not down to ideology but his desire to protect users against things like identity theft.

“Identity theft in the US alone is something like a $30B to $40 billion a year problem. It is more costly than all forms of property theft combined. It’s this massive thing, and crypto comes along and solves that problem.”
But how committed is he to this principle? Would he class it as theft if a government accessed user data to tax a client’s unreported financial transactions. “Yeah, exactly. Taxation is absolutely theft,” he responds with blunt matter-of-factness.

The WSJ investigates

ShapeShift’s ethos has proven controversial among adherents to the rules and regulations around traditional finance. An investigation by the Wall Street Journal alleged Shapeshift users had laundered $9 million via the platform. However a third-party analysis by blockchain intelligence firm CipherBlade suggested the investigation was flawed in assuming that funds were illicit even after passing through four different hands, causing the $9 million figure to be inflated by a factor of four. It is clear that Voorhees, who is normally calm and composed, was deeply affected by this.

“Here’s The Wall Street Journal coming after us, calling us the money launderer, when their own inflated number would put us as far better [at combating money laundering] than any of the major banks that they write about all the time.”

There’s a noticeable quaver in his voice. The battle is personal.

We spend the last minutes comparing attitudes toward money in different societies. In the Nordic countries for example, all taxes are a matter of public record. Voorhees finds this disturbing, adding that “a lot of people with money feel guilty about it” whereas creating wealth in an ethical way he believes is a good thing for society.

“I would like to see people who become very wealthy, first of all be proud of that, so long as they did it in an ethical way, and to use those resources in whatever way they think is best. I think that’s how that’s how economies grow and I think there’s nothing wrong with that.”

The reformed Bitcoin Maxi who saw the light: Erik Voorhees

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Filed Under: blockchain technology Tagged With: Banks, Better, Bitcoin, blockchain, btc, Business, Catch, ceo, Columns, Companies, Conference, crypto, Cryptocurrencies, cryptocurrency, Culture, Currencies, Currency, darknet, data, decentralization, decentralized, Digital, Dubai, economics, economy, ethereum, exchange, Exchanges, fiat, Fiat Money, finance, Financial crisis, founder, Go, gold, government, ICO, identity theft, Internet, IPO, Journeys, KYC, Las Vegas, Mainstream, Market, marketing, money, Money Laundering, New York, other, payments, PayPal, reddit, scam, scams, Seattle, SEC, Securities and Exchange Commission, Silk Road, stock market, tax, Taxes, the wall street journal, Tokens, twitter, us, Wall Street, Wealth, world

Transparent stablecoins? Conclusion of Tether vs. NYAG raises new questions

February 28, 2021 by Blockchain Consultants

A long-standing legal drama finally found resolution on Feb. 23, with the New York Attorney General’s office announcing that it had come to a settlement with cryptocurrency exchange Bitfinex after a 22-month inquiry into whether the company had been trying to cover up its losses — touted to be worth $850 million — by misrepresenting the degree to which its Tether (USDT) reserves were backed by fiat collateral.

According to the terms of the announced settlement, which now marks an end to the inquiry that was initiated by the NYAG back in Q1 2019, Bitfinex and Tether will pay the government body a fixed sum of $18.5 million but will not be required to admit to any wrongdoing. That being said, the settlement clearly states that henceforth, Bitfinex and Tether can no longer service customers in the state of New York.

Furthermore, over the course of the next 24 months, Bitfinex and Tether will be required to provide the NYAG with quarterly reports of their current reserve status and duly account for any transactions taking place between the two companies. Not only that, but the firms will also be required to provide public reports for the specific composition of their cash and non-cash reserves.

On the subject, NY Attorney General Letitia James said that both Bitfinex and Tether had covered up their losses and deceived their customers by overstating their reserves. When asked about this most recent development, Stuart Hoegner, general counsel at Tether, replied to Cointelegraph with a non-committal answer, stating:

“We are pleased to have reached a settlement of legal proceedings with the New York Attorney General’s Office and to have put this matter behind us. We look forward to continuing to lead our industry and serve our customers.”

Does a New York exclusive ban even make sense?

To gain a better legal perspective of the situation, Cointelegraph spoke with Josh Lawler, partner at Zuber Lawler — a law firm with expertise in crypto and blockchain technology. In his view, the lawsuit, and particularly the nature of the settlement in which Tether and Bitfinex agreed to cease actions, underscore the confusion inherent in the regulation of digital assets in the United States.

Additionally, the agreement by Bitfinex and Tether to prohibit the use of its products and services by New York persons and entities seems on paper to be nearly impossible to accomplish, with Lawler opining:

“Are they saying that no one with a New York nexus can own or trade Tether? Tether is traded on virtually every cryptocurrency exchange in existence. Even if Tether could restrict the use of Tether tokens by New Yorkers, is that really a good idea? Do we now have a world in which every state can pick off particular distributed ledger projects from functioning within their jurisdiction?”

Lastly, even though the deal between Bitfinex/Tether and the NYAG has come in the form of a settlement — i.e., it is not subject to an appeal or federal scrutiny under the commerce clause — state-centric bans may further add to the existing regulatory uncertainty.

Added transparency is always a good thing

With regulators now asking Tether and Bitfinex to be more forthcoming about their monetary dealings and issuing an arguably small fine on them, it seems as though an increasing number of firms dealing with USDT will now have to pull up their socks and get their account books in order. Joel Edgerton, chief operating officer for cryptocurrency exchange bitFlyer USA, told Cointelegraph:

“The key point in this settlement is not the elimination of the lawsuit, but the increased commitment to transparency. The risk from USDT still exists, but increased transparency should cement its lead in transaction volumes.”

In a somewhat similar vein, Tim Byun, global government relations officer at OK Group — the parent company behind cryptocurrency exchange OKCoin — believes that the settlement can be looked at as a win-win scenario not only for NY OAG and Tether/Bitfinex but also for the cryptocurrency industry as a whole, alluding to the fact that that the 17-page settlement revealed no mention of Bitcoin (BTC) being manipulated via the use of USDT.

Lastly, Sam Bankman-Fried, chief executive officer for cryptocurrency exchange FTX, also believes that the settlement, by and large, has been a good development for the industry, especially from a transparency perspective, adding:

“Like many settlements, this one had a messy outcome, but the high-level takeaway here is that they found no evidence to support the heaviest accusations against Tether — no evidence of market manipulation or unbounded unbacked printing.”

Will scrutiny of stablecoins increase?

Even though stablecoins have been under the regulatory scanner for some time now — since they claimed to be pegged to various fiat assets in a 1-1 ratio — it stands to reason that added pressure from government agencies may be present when it comes to the transparency side of things from here on out.

Another line of thinking may be that governments all over the world will now look to curtail the use of stablecoins, such as USDT, especially as a number of central banks are coming around to the idea of creating their very own fiat-backed digital currencies. As a result, governments may want to push their citizens to use their centralized offerings instead of stablecoins.

Related: Many pieces of the Diem puzzle still missing as launch gets delayed

On the subject, Byun noted: “Stablecoin is just one type of cryptocurrency or ‘convertible virtual currency,’ and therefore, stablecoins and the stablecoin market will continue to attract scrutiny and mandated examinations from regulators.” That said, Byun believes that whether it’s Bitcoin, Ether (ETH) or Tether, crypto investors generally understand that investing in crypto remains a high-risk activity and that they “must practice caveat emptor” at all times.

Does Tether impact institutional adoption?

Another pertinent question worth exploring is whether or not the settlement may have an adverse impact on the institutional investment currently coming into this space. In Lawler’s opinion, the decision is not going to slow down adoption even in the slightest. “Institutions are not principally focused on Tether. There are other stable coins, and Bitfinex is all but irrelevant to them,” he added.

Similarly, it could even happen that the ongoing reporting requirements set by the NYAG for Bitfinex and Tether may end up bolstering institutional confidence in Tether — a sentiment that some of Tether’s most vocal and consistent critics also seem to agree with.

That being said, a lot of speculation around Tether’s fiat reserves continues to linger on; for example, Tether Ltd.’s finances are handled by Bahamas-based Deltec bank. In this regard, one anonymous report claimed that “from January 2020 to September 2020, the amount of all foreign currencies held by all domestic banks in the Bahamas increased by only $600 million,” up to $5.3 billion. Meanwhile, the total volume of issued USDT soared by a whopping $5.4 billion, up to around $10 billion.

As Tether states on its website USDT is covered by fiat and other assets, so such investigations cannot be conclusive. However, what both NYAG and the anonymous authors of the report agree upon is that Tether needs to be more forthcoming about its financial status. With that in mind, Tether’s commitment toward transparency and revealing its reserves to a regulator seems like a step in the right direction.

Transparent stablecoins? Conclusion of Tether vs. NYAG raises new questions

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Filed Under: blockchain technology Tagged With: Adoption, Bank, Banks, Better, Bitcoin, Bitfinex, blockchain, Books, Cash, chief, chief executive officer, Companies, crypto, cryptocurrency, cryptocurrency exchange, Currencies, Currency, Digital, ether, exchange, executive, fiat, government, Investing, investment, Law, lawsuit, Ledger, LINE, Market, New York, opinion, other, partner, printing, Regulation, Space, stablecoin, Stablecoins, Technology, Tether, Tokens, United States, us, USA, USDT, view, world

A Comprehensive Guide to Cryptocurrency Trading Strategies

February 28, 2021 by Blockchain Consultants

A Comprehensive Guide to Cryptocurrency Trading Strategies

Are you a Crypto Enthusiast who wants to learn crypto-related trading strategies? Well, we have got you covered. This article talks about what crypto trading is, the most common trading strategies, and represents ways to learn the crypto market and trading strategies.

Table of Contents 

  • What Exactly is Crypto Trading?
  • Types of Trading Strategies 
  • Concluding Lines: Ways to Learn Cryptocurrency Market and Trading Techniques

What Exactly is Crypto Trading?

Cryptocurrency trading is the act of speculating on cryptocurrency price via buying and selling the underlying coins through an exchange. The market of Cryptocurrency is decentralized, meaning they run across a network of computers and are not backed by a central authority. The underlying technology behind Cryptocurrency is Blockchain which is a peer-to-peer, decentralized distributed ledger technology. 

Out of all the cryptocurrencies, Bitcoin is undoubtedly the first and most widely used one all across the globe and has the biggest market cap of $54,280.00 at the time of writing. 

Interested in learning more about cryptocurrency trading and becoming a Certified Cryptocurrency Trader? Get started today with Blockchain Council!

Types of Trading Strategies 

  • Scalping 

Scalping is a crypto-based strategy of taking advantage of small market movements, promptly entering and exiting trades during a day, or maybe even an hour or seconds. The major advantage of this technique is that it is relatively safer than other trading strategies. And since this strategy employs minimal time frames, therefore it is possible to exit the trade anytime, even in case if you have a series of bad trades. This technique empowers users to control how much they win and lose. 

While utilizing this strategy, the trader has to watch charts precisely and stay near the trading terminal in order to be able to react promptly to market change.

  • Swing Trading 

In comparison to day trading(that involves entering and exiting positions within the same day) and trend trading(that involves holding positions for a longer period of time), this trading strategy sits in the middle between the two. It holds positions for longer than a day(unlike scalping) but typically not longer than a few weeks or a month. This strategy uses a combination of technical and fundamental factors to formulate their trade ideas.  With this particular trading, decisions can be made with less haste and more rationality unlike day trading that requires fast decisions and speedy execution. 

  • Automated Trading Bots 

This is another popular strategy for trading that is used widely. We can define automated trading bots as automated computer programs that can sell and buy cryptocurrencies independently. The primary purpose of such types of bots is to produce as much profit as possible for their consumers. The trading by these bots is done by constantly monitoring the market and reacting to the specific set of predetermined rules. Based on user preferences, these bots can analyze the various market criteria such as price, volume, orders, and others.

  • Arbitrage 

This one is the most common trading strategy in which a trader buys an asset when the price is low and sells when the price goes higher. 

  • Dollar-Cost Averaging (DCA)

Dollar-Cost Averaging (DCA) is a type of investment strategy whose aim is to lessen the impact of volatility when an investor purchases large financial assets like equities. In the UK, it is recognized as Pound Cost Averaging, whereas in the US, it is known as Constant Dollar. The major benefit of this trading strategy is that it eliminates emotional investing, reduces risks, and avoids bad timing.

  • Fundamental Analysis

In fundamental analysis trading strategy, traders use several different indicators to know if an asset is undervalued or overvalued. This strategy is used majorly by those traders who want to hold their assets for longer periods of time. The strategy is based on the idea that if an asset is undervalued, then its price and worth can be improved over time. 

  • Staking Coins and Tokens 

Staking coins and tokens is the other technique that traders opt for. They perfectly align with the diversification goal, as they generate staking profits over time. The process is simple; you just have to buy them, lock them, and stake and become a validator node in their respective network.

The best part is that you need not require any additional maintenance, as after buying and locking the staking tokens, you can forget them until the next staking cycle. Also, you can sell them at any moment, and they don’t devalue.

Concluding Lines: Ways to Learn Cryptocurrency Market and Trading Techniques

As we have explored some of the most common trading techniques, let’s explore how to master the Cryptocurrency market and learn trading through online certifications. 

Certified Cryptocurrency Expert

This certification course provides an advanced level of training that provides you with profuse expertise on cryptocurrencies and digital assets. A cryptocurrency expert is one who has a wide knowledge of cryptocurrencies and the functioning of distributed ledger technology. He possesses expert-level knowledge about bitcoin protocols and can develop and integrate applications with the bitcoin network. The training covers all the fundamentals of Cryptocurrency, such as the concept of blockchain, Initial Coin Offering (ICO), educates how to trade, what to buy, wallets, and much more.

Certified Cryptocurrency Trader

This course is meant for you if you are one of those who wants to know all about trading rules and predicting markets. A Cryptocurrency Trader is a skilled professional who knows in-depth what Cryptocurrency is and how it works and uses the acquired knowledge to make new utility tokens and Cryptocurrencies. This certification is suitable for beginners and professionals who want to give their careers a boost specializing in cryptocurrency trading. This course will help you explore trading in-depth, understand risk management and trading psychology. Additionally, you will learn about candlestick charts and trading strategies. 

Online Degree in Cryptocurrency and Trading 

This cryptocurrency certification provides detailed information on cryptocurrencies, blockchain, the technology behind cryptocurrencies, the concept of trading, how to trade, and more deeply. An Online Degree holder works closely with cryptocurrency trading, investments, & crypto consultation. With the help of this course, you will also learn about spotting the current trends and analysis, which will definitely enhance your crypto-trading skills. After completing this Online Degree, you will be able to master the concepts of Cryptocurrency & trading that are commonly used across multiple industries to solve large-scale problems.

To get instant updates about Blockchain Technology and to learn more about online blockchain certifications, check out Blockchain Council.

A Comprehensive Guide to Cryptocurrency Trading Strategies

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Filed Under: blockchain technology, cryptocurrency Tagged With: analysis, article, Bitcoin, blockchain, bots, crypto, Cryptocurrencies, cryptocurrency, decentralized, Digital, exchange, ICO, ideas, information, initial coin offering, Investing, investment, Investments, Ledger, Market, Markets, other, Risk Management, Technology, Tokens, Trading, trends, uk, us

Grayscale Trust Records Negative Premiums Amid Market Crash

February 27, 2021 by Blockchain Consultants

At its inception, the Grayscale Bitcoin Trust was downright revolutionary. It opened many doors for the crypto space to gain higher levels of mainstream presence. As a testament to this, it’s the largest listed crypto asset out there, boasting a total of $30.17 billion in assets under management.

Grayscale’s US Supremacy

The fund itself was launched all the way back in 2013. The Grayscale Bitcoin Trust (GBTC) quickly broke new ground, becoming the institutional vehicle of choice when it comes to the US’s crypto space. In a big part, this is thanks to the SEC being extremely prudish in allowing Bitcoin-based exchange-traded funds, but even so, GBTC is an amazing concept.

The US Office of the Comptroller of Currency (OCC) stands as the official regulator of investment trust funds, being exclusively designed for accredited investors that have proven their worth numerous times. Even so, retail investors can get their hands on it, as well, should they opt for a six-month lockup period to get access to it.

Skyrocketing Premiums Slowly Decreasing

With all of this in mind, this leads to the GBTC asset to be traded at a premium: The price of GBTC is more than the price of the equivalent amount of Bitcoin represented in its shares. This occurs as the demand from retail traders starts to rise within the secondary markets.

Institutional clients have it better, however, being able to buy at par-price from Grayscale Investment directly. This completely bypasses whatever price GBTC is on the OTC market.

This premium can skyrocket, with GBTC witnessing as high as 40% above the Bitcoin equivalent’s asking price. Over the past four weeks, this calmed down considerably, with a premium ranging from 5% to 10% when Bitcoin reached $58,000 and saw a subsequent and violent correction. Some speculate that this is just the start, however.

Trading GBTC At A Discount

Now, however, amid an increase in the US 10-year Treasury Bond’s interest rate, which generally destabilized the stock and crypto markets, GBTC is in a bit of a problem. With everything going down, there was a distinct appetite loss for secondary markets.

This, in turn, unbalanced GBTC, making it go for a discount. GBTC also has no real way to recover from this, as there isn’t a surefire way to convert GBTC directly into BTC.

The odd thing is, GBTC has been subject to several spectacular market crashes within the general Bitcoin market. None of that ever seemed to really bother GBTC and its rather impressive market premium.

Something that could be affecting it, however, is the new entrance of BTC Exchange-traded funds (ETFs). Purpose ETF is now on the market, wresting the monopoly from GBTC as the one and only Bitcoin derivative officially listed. Nothing concrete can be said for truth, but things certainly change when new competitors enter the ring.

Grayscale Trust Records Negative Premiums Amid Market Crash

Source

Filed Under: blockchain, cryptocurrency Tagged With: Better, Bitcoin, btc, correction, crypto, cryptocurrency, Currency, ETF, Go, grayscale, investment, Mainstream, Market, Markets, monopoly, SEC, Space, Trading, us

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