Cryptocurrency finance startup Circle has stopped its line of research reports saying it needs to reconsider the offering.
In a post on its website on Tuesday, Circle reached out to consumers of the service, saying:
“While we’ve made significant progress with our content offerings, it’s time to evaluate our contribution and overall strategy. With that in mind, we’ve decided to pause Circle Research activity for the time being as we decide on a future direction for the program.”
Circle Research had provided weekly and quarterly overviews of the crypto space, looking at markets, blockchain news and industry news.
The move may be a continuation of apparent cost-cutting moves by the firm which offers cryptocurrency payments via an app, OTC trading and spot trading via its Poloniex exchange platform (acquired in February of last year). It’s also part of a consortium including Coinbase that has launched a stablecoin pegged to the U.S. dollar called USD Coin (USDC).
Three months ago, Circle said it would wind down the Circle Pay app, with a closing date for the service of Sept. 30. At the time the firm’s CEO, Jeremy Allaire said it makes sense to focus more on USDC and “wallet services that take a bigger step toward reaching our original vision for a free, open and transparent global payments network.”
And in May, 30 staff were let go – roughly 10 percent of its employees – with Circle citing market conditions and “an increasingly restrictive regulatory climate in the United States,” as the reason.
- BTC looks set to test support near $7,500, having confirmed a bearish reversal with a high-volume triangle breakdown on Tuesday.
- The cryptocurrency’s violation of the historically strong 55-candle exponential moving average (MA) on the three-day chart also favors a deeper price slide.
- The outlook would turn bullish if prices quickly rise above Tuesday’s high of $9,782, although that looks unlikely at press time.
Bitcoin fell sharply on Tuesday, confirming a bearish reversal and opening the doors for a test of crucial price support near $7,500.
The leading cryptocurrency by market value ran into selling pressure around $9,700 in the early U.S. trading hours and fell to a 3.5-month low of $7,998 at 19:45 UTC on Bitstamp.
BTC had been on slippery ground following Tuesday’s volatility band breakdown. A widely-followed indicator was also reporting the strongest a bear bias in nine months, as discussed earlier this week.
The price slide was likely exacerbated by a long squeeze, when investors square off (or sell) long positions to cut losses in a falling market, thereby creating further downward pressure on prices.
So, while a price drop was expected, the magnitude of the sell-off has caught many by surprise. The cryptocurrency fell by 11.83 percent on Tuesday – 2019’s third-biggest single-day drop, as per Bitstamp data.
- BTC has seen double-digit daily losses four times this year.
- The biggest single-day loss of 2019 witnessed on June 27 marked a healthy correction from a 17-month high of $13,880 reached on the preceding day.
The latest double-digit price slide has taken the cryptocurrency below major support levels. Therefore, a deeper drop toward $7,500 – a level seen a week ahead of Facebook’s launch of Libra – could be seen over the next few days.
As of writing, BTC is changing hands around $8,400 on Bitstamp. It’s worth noting the cryptocurrency is still up about 127 percent on a year-to-date basis.
Daily and monthly charts
Bitcoin dived out a three-month contracting triangle on Tuesday (above left), confirming an end of the bull market, which had started from April’s low near $4,000.
Currently, prices are flirting with the 200-day moving average (MA) support at $8,309. That long-term MA has come into play for the first time since April and will likely be breached, as the post-triangle breakdown price drop looks to have legs – volumes hit three-month highs on Tuesday.
BTC, therefore, risks extending losses to support at $7,500 – lows seen before Libra hype gripped the market in mid-June
Moreover, the triangle breakdown could yield a drop to $4,000 (target as per the measured move method), as tweeted by bitcoin skeptic and CEO of Euro Pacific Capital Peter Schiff. That target looks far-fetched, however.
The monthly chart (above right) is also now teasing a bearish reversal. The cryptocurrency charted inside-bar candlestick patterns in the previous two months, signaling an impending bullish-to-bearish trend change.
The outlook as per the monthly chart would turn bearish only if prices close below $9,049 (first inside bar’s low) on Sept. 30. That looks likely, with prices currently trading at $8,400 and the daily chart reporting a strong bearish setup.
The bearish case would weaken if prices find acceptance above $9,097 – a higher high created on May 30. The outlook would turn bullish if prices bounce from the 200-day MA and chart a quick V-shaped recovery to levels above Tuesday’s high of $9,782. That, however, looks unlikely.
BTC has found acceptance below the 55-candle exponential moving average, which served as a strong base during the 2016-2017 bull market.
Back then, the cryptocurrency charted bullish higher lows along the key EMA and not once did the sellers managed to secure a close below the crucial support.
Hence, the latest close below the 55-candle EMA could be considered a strong bearish development.
Oversold daily RSI
The 14-day relative strength index (RSI) is currently hovering below 23, its lowest level since November 2018. A reading below 30 indicates oversold conditions and suggests scope for a corrective bounce.
That said, indicators can and do remain oversold for a prolonged period in a strong bearish market, especially when a sell-off is preceded by a major bout of consolidation. BTC was trapped in a narrow range for almost three months before breaking lower.
In such situations, seasoned trades consider an oversold reading on the RSI as an indicator of trend strength. So, expecting a notable price bounce on the basis of the oversold reading on the RSI could prove costly.
Disclosure: The author holds no cryptocurrency assets at the time of writing.
The lightning-friendly Fold App, which allows users to spend bitcoin on goods like clothes and pizza and then earn bitcoin-back rewards, just added fiat capability after raising its first round as an independent startup.
Fold product lead Will Reeves told CoinDesk the startup spun out of Thesis with a $2.5 million raise led by Craft Ventures, CoinShares, Slow Ventures, Goldcrest Capital and Fulgur Ventures, among others. Reeves said that capital will go towards cementing partnerships, both in the cryptocurrency and retail space.
“We’ll be rolling out subscription options for merchants and consumers soon that will provide premium services and highest rewards,” Reeves said, adding:
“When people spend fiat at retailers they will receive BTC rewards. They can spend those rewards or withdraw them to an on-chain address. In the future, we are releasing an update that allows people to withdraw rewards directly to lightning, which will lower fees and make it more usable.”
In short, the app can be connected to a debit card for bitcoin-back on regular purchases through the app, or users can send bitcoin to the Fold App from their independent wallets. A mobile Fold App with the full features currently available via desktop, Reeves added, is slated for launch in October. Until then, the mobile app is also available to users that sign up through Fold’s website for early access.
CoinShares co-founder Meltem Demirors told CoinDesk Fold App is unique, compared to other retail-focused bitcoin apps, because it encourages users to use non-custodial wallets.
“I’m excited to work not only with Fold, but also with our community of portfolio companies, corporate partners, and other service providers to build an integrated user experience around bitcoin payments,” she said.
While there are several other retail-focused crypto apps gaining traction, like Lolli and Flexa, Fold is the most focused on lightning payments. Fold App is already integrated with two lightning-friendly wallets, BlueWallet and Breez. This is what attracted Fulgur Ventures partner Oleg Mikhalsky to the investment.
“We believe the lightning network has the ability to become an interesting payments rail for various applications due to features like instant final settlement, cost-efficient micro-transactions, the ability to ‘stream’ payments and the support of other assets over Lightning in the future,” Mikhalsky told CoinDesk, adding:
“We, as investors, are in a learning mode as well. We’re placing our bets on different types of applications and models and learning from them. Supporting startups that experiment with how to drive adoption is one of our priorities.”
Lolli told in July that it, too, was planning to eventually add lightning options. So it remains to be seen how the retail app race will play out.
In the meantime, Fold is offering a type of crypto training wheels to retailers like Macy’s, Target and Amazon. On the merchant side, they only see a payment processed by Fold, not the users’ credit card or bitcoin wallet address. This offers more privacy than directly shopping via the merchant’s website. Fold then cashes out the payment for merchants, which typically choose to receive the value in fiat.
“We can settle in fiat or bitcoin, yet all major merchants choose to settle in fiat now so they don’t take volatility risk or accounting overhead,” Reeves said, adding:
“Fold can seamlessly transition them when they are ready because we are already directly integrated into their point-of-sale systems.”
The computing power dedicated to mining bitcoin has hit yet another new high, suggesting that more than 600,000 powerful new machines may have come online in the last three months.
According to data from crypto mining pool BTC.com, bitcoin’s two-week average hash rate has crossed another major threshold, reaching 85 exahashes per second (EH/s) around 19:00 UTC last Friday. Meanwhile, mining difficulty also adjusted to a new record of nearly 12 trillion.
Notably, both figures have jumped 60 percent since June 14, the data shows.
Bitcoin’s mining difficulty – a measure of how hard it is to create a block of transactions – adjusts after 2,016 blocks, or roughly every two weeks. This is to ensure the time to produce a block remains around 10 minutes, even as the amount of hashing power, deployed by machines around the globe competing to win freshly minted bitcoins, fluctuates.
Several new models of application-specific integrated circuit (ASIC) miners hit the market over the summer, with an average hashing power around 55 tera hashes per second (TH/s).
Assuming all of the 35 EH/s of new hashing power added since mid-June came from these top-of-the-line models, a back-of-the-envelope calculation suggests that more than half a million such machines have connected to the bitcoin network. (1 EH/s =1 million TH/s)
These powerful ASIC miners, made by major manufacturers such as Bitmain, Canaan, InnoSilicon and MicroBT, are priced from $1,500 to $2,500 each. So if more than half a million of them were delivered, as estimated above, the leading miner makers could have made $1 billion in revenue over the past three months.
Bitcoin’s spiking hash rate and difficulty are in line with the soaring price since earlier this year, which led to increasing demand for mining equipment that has significantly outstripped supply. It’s also in part thanks to the rainy summer season in southwestern China which resulted in cheap, abundant hydroelectric power.
Further, there has also been a growing interest in Russia’s Eastern Siberia region, where the Brastsk hydropower station built in the Cold War era has been utilized to power mining farms that are estimated to account for almost 10 percent of the total computing power on the bitcoin network.
Miners in China estimated earlier this year that bitcoin’s average hash rate in the summer would break the level of 70 EH/s, which happened in August.
As such, major miner manufacturers have already sold out equipment that is due for shipment until the end of the year with customers placing pre-orders three months in advance.
TokenInsight, a startup that focuses on analysis of crypto trading and mining activities, said in a report published Friday that additional supplies of miners are expected to hit the market in the coming months.
“Following the drastic increase in bitcoin’s price, the bitcoin mining market saw significant inflation in Q2 2019. Most of the miners from various manufacturers were in serious shortage and pre-orders submitted in Q2 and Q3 are to be delivered by the end of the year,” the report states.
Therefore, the firm estimates mining difficulty will maintain its growth momentum to reach 15 trillion by the end of the year – with bitcoin’s average total hashing power crossing the threshold of 100 EH/s for the first time in its history.
Venezuela’s largest bank, Bank of Venezuela (BDV), has added support for the country’s controversial Petro digital currency.
Bank of Venezuela hints at crypto wallet
As cryptocurrency news outlet Decrypt reports on Sept. 13, BDV clients have discovered a new section in their online banking account dedicated to cryptocurrencies.
At present, the publication states, the only crypto wallet only caters to Petro, but as the section appears under development, speculation suggests more tokens may follow.
Petro, launched by the Venezuelan government, is notionally pegged to the country’s oil reserves. The subject of criticism from the outset, Petro subsequently faced international sanctions after suspicions arose the government was using it to evade existing restrictions.
Bitcoin trading hits 120 billion bolivars
As Cointelegrpah reported, Venezuela is becoming increasingly reliant on decentralized cryptocurrencies such as Bitcoin (BTC), as other alternatives prove unreliable.
Huge inflation affecting the national currency, the Sovereign Bolivar (VES), continues to produce trading records on P2P bitcoin exchange Localbitcoins.
For the week ending Sept. 7, the most recent period for which data is available, Venezuelans traded over 120 billion VES for Bitcoin.
LocalBitcoins weekly trading volumes for Sovereign Bolivar (VES). Source: Coin Dance
A Californian politician has become the first elected official to use cryptocurrency to purchase cannabis in the United States.
A press release shared with Cointelegraph on Sept. 11 revealed that Berkely City Councilmember Ben Bartlett used Bitcoin Cash (BCH) and the stablecoin Universal Dollar (UPUSD) to make the purchase at Ohana Cannabis, a dispensary in Emeryville, CA.
The purchase was part of a live demonstration of crypto-financial technology conducted by blockchain company Cred and the Blockchain Advocacy Coalition. The latter is a group of California-based businesses and consumers that work to promote transparent blockchain legislation at a state and national level.
Cannabis Tax Remittance Via Stablecoin
According to the press release, the initiative forms part of the Blockchain Advocacy Coalition’s sponsorship of a new bill (AB 953) that would enable California to accept cannabis tax remittance via stablecoin. During the demonstration, the team at Cred was reportedly on hand to explain the ins and outs of blockchain and stablecoin technology to local elected officials.
The transaction involved Ohana accepting Bitcoin Cash by using Cred’s LBA token as a translation utility, with sales and city tax proceeds settled in Universal Dollar.
Universal Dollar — which runs on the Ethereum blockchain and is pegged to the US dollar — was developed by the Universal Protocol Alliance, a coalition of blockchain firms including Cred, Uphold and Blockchain at Berkeley.
In a statement, Dan Schatt — co-founder of Cred and the Universal Protocol Alliance — outlined:
“Not only does crypto result in significant cost reduction for consumers and merchants, but it also enables highly productive tax collection, transparency, and predictability for city and state governments.”
Crypto for the Green Rush industry
As the press release notes, 70% of California’s state cannabis industry is unbanked, significantly increasing both the risks and costs faced by local governments required to accept tax remittance in large cash deposits.
Councilmember Bartlett remarked that in providing a cash-free mechanism for cannabis tax remittance, the proposed AB 953 bill represents a piece of innovative legislation appropriate for the 21st-century so-dubbed Green Rush industry.
The politician has now reportedly requested Berkley City staff to prepare a report on acceptance of cannabis taxes using stablecoin technology.
Back in 2018, the state of Ohio was hailed for its pioneering acceptance of Bitcoin (BTC) for enterprises’ tax liabilities. Several other U.S. states had pursued — but not yet succeeded in implementing — similar initiatives prior to Ohio.
The Bitcoin (BTC) symbol will now appear on the shirt sleeve of Watford Football club players, and the team will also accept the cryptocurrency for merchandise purchases.
The football club announced in a post on its website published on Sept. 12 that the famous Bitcoin “B” logo will be featured on the player’s uniforms as a result of the club’s partnership with Bitcoin betting platform Sportsbet.io.
The team will also accept the leading cryptocurrency as a payment for its merchandise.
A public awareness campaign
According to the official post, the logo’s addition to the uniform is part of a wider campaign aiming to “improve awareness around Bitcoin and educate the public on the benefits of using cryptocurrencies.”
The head of marketing of the team’s main shirt sponsor Sportsbet.io Justin Le Brocque said that the company is giving back to the crypto community:
“The crypto community have been hugely supportive of us since we began, so putting the Bitcoin logo on the sleeve felt like a fun way to give something back while also showing them our support.”
The sponsorship will be crowdfunded and anyone can bid Bitcoin to access a public LED space shown live during matches and exclusive Watford FC merchandise. Le Brocque also added that he hopes the initiative “will create even more buzz around cryptocurrencies.”
As Cointelegraph reported in August, the Dallas Mavericks have become the second NBA team to accept Bitcoin as a means of payment for match tickets and merchandise.
For many, trading cryptocurrency can be a challenge, but the process is made easier if one relies on a combination of technical analysis tools and oscillators to provide insight on which path digital assets like Bitcoin (BTC) might take.
Typically, one sees traders employ the relative strength index (RSI), moving average divergence convergence (MACD), Stochastic RSI (Stoch) and a mixture of exponential moving averages (EMAs), Bollinger Bands, volume measurements and so on. This is good and well, and utilizing these tools often provides great results for traders.
The difficulty of relying on these tools increases when Bitcoin’s price action becomes range bound and consolidates for lengthy amounts of time like it has done for the past two weeks. This leads intraday traders to search for other tools that provide insight into Bitcoin’s market structure.
To get some clarity on the less studied metrics retail investors might be unaware of, Cointelegraph spoke with Christopher Inks of TexasWest Capital — market research and educational firm dedicated to providing accurate market data and digital asset trading courses for novice traders.
Cointelegraph: Pleasure to meet you Christopher and thanks for taking the time to have a chat. To kick things off tell us what brought you to crypto?
Christopher Inks: The whole reason I do what I do with TexasWest Capital is that I noticed the really bad analysis, pump-n-dumps, and other nonsense being published across various crypto media, major media and on Twitter.
This was especially bad during at the end of 2016 leading into 2017 and still continues to be an issue today. So being able to share good information with new traders is an important thing to me.
CT: Recently there’s been a lot of talk about “funding” amongst pro-traders and some look to the levels of funding on perpetual contracts as a method for determining whether Bitcoin’s spot price will go bearish or bullish on the larger exchanges. To what degree does the level of funding from perpetual contracts impact Bitcoin price action?
CI: I would argue that it has more to do with funding rate extremes than anything else. And even then, it is an indicator of which way the spot market is already heading rather than something that causes the market to change direction.
The funding rate — by itself — is just a mechanism used by the exchange to help their synthetic product (perpetual swaps, in this case) mimic spot price. If it’s negative, then short contract holders pay long contract holders since it means that the previous eight-hour period saw swap contracts trading at a discount to the underlying spot price.
If it’s positive, then long contract holders pay short contract holders for the opposite reason. However, as long as the funding rate is low, there isn’t a lot of encouragement to move traders from long to short or short to long. It’s when the funding rate starts increases strongly that the market participants are more likely to move away from the pain of holding their position.
But even at that point, it’s doing nothing more than keeping the exchange’s synthetic product’s price comparable to the spot price. To this end, traders can potentially use the funding rate to understand which way spot price may be heading and then trade spot on other exchanges accordingly.
CT: What is open interest and to what degree does it dictate Bitcoin’s future price action?
CI: Open Interest is just the number of contracts outstanding, which basically means it is a measure of market activity. If open interest is increasing, then we know that new money is entering the market and, as a result, the prevailing trend should continue. A decline in open interest signals that the trend is likely ending since money is leaving.
CT: What’s you take on the whole Bitcoin as a store-of-value and hedge against volatility narrative that has become the consensus amongst analysts and investors at the moment?
CI: With many fundamental legacy market indicators flashing incoming recession, Bitcoin market participants are pushing the “Bitcoin is digital gold” narrative. But the truth is that we don’t know if it really is yet.
“The Bitcoin market has only been around during a bullish economy, so we don’t know how it will perform during an economic downturn.”
We do know that Bitcoin’s volatility makes it a risky asset and in a risk-off environment that normally means that it shouldn’t interest people. Smart traders and investors will pay keen attention to the Bitcoin market if a recession hits and play the market accordingly. A strong Bitcoin in a recession will go a long way to supporting that digital gold narrative.
CT: From your experience as an educator and 20-year trader, do you think it’s better for traders to exploit intraday moves or swing trade with the macro perspective in mind? Furthermore, do you think intraday traders should use leverage to better capitalize on crypto’s volatility?
CI: I am a firm believer in the swing trade, and this is especially so for new traders. The newer the trader, the longer the time frame they should necessarily be trading. Personally, I trade intra-day and multi-day swings and that’s with 20+ years experience.
By doing this, traders can more effectively utilize leverage as they find more prominent bases from which to long or ceilings from which to short. It also helps with controlling their emotions to a much greater extent than 15 or 30-minute charts.
CT: Previously, you’ve said psychology plays an important role in market movement and the decisions traders make. Can you share a scenario where psychology determined market movement and crypto price action? How do you make this systematic?
CI: Charts are just visual representations of human interaction, and that interaction is based on the movement between fear and greed. So understanding this, traders are in a better position to read the volume and price action to decipher what is truly going on.
If you’re waiting for the news to make a move, then you’re always reacting. But being able to read that volume and price action makes you proactive as you can set positions before the news comes out so you are able to ride the movement rather than dealing with your emotions as you fight to enter after the movement has started.
New York-based cryptocurrency brokerage and trading platform Tagomi allows its users to lend or borrow Bitcoin (BTC) and Ether (ETH) to facilitate long or short trades.
Bloomberg Quint reported on Sept. 12 that the exchange aims to make shorting easier by offering immediate access to multiple counterparties from a single platform.
The state of shoring in crypto
Per the report, to short crypto assets, traders currently have to “call a host of brokers and trading desks to find the best rates for borrowing and risk the market moving against them during the time it takes to put on a trade.” Tagomi’s chief operating officer Kevin Johnson commented on the difficulty of applying such strategies to crypto:
“In other asset classes this would be done with one click, but in crypto it’s very long and tedious to try and put a short on. ”
Shorting: part of the puzzle
Dennis Chou, director of trading at Pantera Capital, noted that the ability to short is important to traders. He noted that it is not only useful to those wanting to bet against crypto, but also to those looking to apply quantitative strategies, relative-value trades and hedging. He commented:
“The crypto space is volatile, so if you can’t short, you’re missing part of the puzzle.”
As Cointelegraph reported at the end of March, the New York State Department of Financial Services has granted a BitLicense to Tagomi.
The buzzy scavenger hunt for $1 million worth of bitcoin, Satoshi’s Treasure, is coming this fall to nearly two-dozen college campuses worldwide.
The game is operated by a small, mysterious company based on a tropical island (figuring out more about the game itself is part of the appeal) and is sponsored by Primitive Ventures and other prominent investors. Eventually, there will be hundreds of cryptographic keys around the world, shrouded in puzzles and riddles, and the first team to compile 400 of the key fragments will be able to claim the prize.
According to game co-creator Eric Meltzer, over 100,000 people are now on the email list for updates and announcements related to such clues, 40 of which have been released so far.
Now BlockVenture Coalition partners Tyler Wellener and Philip Forte are kicking off a North American campus tour with 20 universities, hosting educational meetups and mini hunts to help students join the game.
“A lot of these students want to learn about blockchain and crypto, but their universities haven’t caught up to them yet,” Wellener told CoinDesk. “We’re looking to provide resources for a lot of these different student groups.”
There will be smaller rewards associated with campus scavenger hunts and self-custody workshops starting mid-September, although organizers are still working out the details.
Image of Tyler Wellener (left) and Philip Forte (right) via BlockVenture Coalition
IDEX CEO Alex Wearn told CoinDesk his exchange will also sponsor some campus workshops focused on bitcoin wallets and decentralized exchanges.
Jonathan Calso, head of the blockchain group at the University of Michigan, told CoinDesk these sponsored meetups benefit the student body by bringing hands-on learning opportunities to campus and giving student clubs like his more credibility among faculty. His college is one of the many Wellener referred to – those that lack courses and official resources related to bitcoin.
“This helps us get more visibility from the engineering department, economics and computer science departments as well,” Calso said, adding:
“The clues incentivize you to discover new websites and tools … to play around with a bitcoin wallet a bit, to see what the technology can do.”
Meanwhile, Satoshi’s Treasure co-founder Jessica Wang told CoinDesk she’s helping student groups at several universities in China and Australia get involved with the fall semester campaign, including Shandong University.
“Students are the future of this industry, so we’re going to put small prizes, like one bitcoin, into this game to attract more students,” she said. “We’re going to hide more physical location puzzles globally.”
Wang said that, according to Google Analytics data from the game’s main website, so far roughly 60 percent of traffic comes from the United States and Canada, followed by Russia, France and Indonesia. As such, these custody-focused seminars in North America will also aim to connect students around the world.
“We’re going to have one [key] piece at a university in Asia and another in a university in the U.S. So they’re going to need to network with each other,” Wang said.
Thanks to a small grant from the Tezos Foundation, Satoshi’s Treasure organizers will also hire cryptography experts at the Massachusetts Institute of Technology, plus external foundations, to keep up with demand for more keys by ramping up the puzzle-making process.
“Top cryptography foundations and teams will create more puzzles on their end,” Wang said. “We want the ecosystem to bring more stakeholders into the game.”
Eugene Leventhal, former head of Carnegie Mellon University’s blockchain club and a current member of the university’s CyLab Security & Privacy Institute, told CoinDesk these seminars and campus scavenger hunts could also help engage a wider range of students. CMU Blockchain Group events typically attracted around 30 students each in 2018, with the highest turnout being roughly 80 students.
“For the humanities side, we hope something like this will be a way to get more students involved,” Leventhal said, adding: