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Bitcoin Bulls Withstand ETF Rejection to Push Bitcoin Price towards Two-Month High: Week in Review July 30

Bitcoin Bulls Withstand ETF Rejection to Push Bitcoin Price towards Two-Month High: Week in Review July 30

Reading Time: 6 minutes by on July 30, 2018 Altcoins, Bitcoin, Commentary, News, News Digest
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The price of bitcoin rallied by ten percent week-on-week despite the rejection of the Winklevoss Bitcoin ETF by the U.S. Securities and Exchange Commission (SEC), which caused a brief drop in price mid-week.

The SEC declined the appeal of the Winklevoss ETF because “[the] exchange [must] be designed to prevent fraudulent and manipulative acts and practices and to protect investors and the public interest,” and it feels that the Winklevoss Bitcoin Trust has not met these conditions.

Nonetheless, it is the consensus among bitcoin investors that it will be only a matter of time until the first publicly traded Bitcoin ETF will hit a U.S. stock exchange. Crypto asset management company firm Bitwise, for example, announced this week that it is filing for a cryptocurrency basket ETF and last week, the CBOE announced its plans to launch a Bitcoin ETF.

The altcoin market had a mixed week and closed slightly in the green. Ethereum’s ether (ETH) has not moved and closed the week effectively unchanged. Some investors have reportedly been shorting ETH with the belief that the digital token is overvalued due to its scaling issues.

This week’s contributions have been provided by Aisshwarya Tiwari, Jefferson Nunn, Joseph Young, Ogwu Osaemezu Emmanuel, Priyeshu Garg, and Shaurya Malwa.

SEC Declines Winklevoss Brothers Appeal for Bitcoin ETF

In a three-to-one vote on July 26, 2018, the SEC declined an appeal by the Winklevoss Bitcoin Trust to launch the much-awaited Bitcoin ETF.

Among other things in the 92-page statement, the SEC said that the Trust was declined because “[the] exchange [must] be designed to prevent fraudulent and manipulative acts and practices and to protect investors and the public interest.”

The commission argues that the Winklevoss Bitcoin Trust must comply with this section by offering some means of identifying fraud and market manipulation. The Commission further stated that previously approved commodity-trust ETPs entered into a surveillance-sharing agreement with a regulated bitcoin-related market of significant size.

For those reasons, the SEC declined the appeal by stating: “Therefore, [Winklevoss Bitcoin Trust] has not met its burden to demonstrate that the proposed rule change is consistent with Exchange Act Section 6(b)(5), and, accordingly, the Commission is disapproving the proposed rule change.”

Payments App Skrill Introduces Cryptocurrency Trading for Bitcoin, Bitcoin Cash, Litecoin, and Ether

Skrill, the popular online payments processor firm that enables users to send and receive money seamlessly over the internet, has now added support for bitcoin (BTC), bitcoin cash (BCH), ether (ETH), and litecoin (LTC), to make life easier for users and retain its customers.

As announced by the firm on July 25, 2018, holders of the Skrill wallet will now be able to buy or sell supported cryptos from some parts of the world.

As stated on its website, cryptocurrency investors can now make use of the over 100 alternative payment methods and 40 fiat currencies supported by the platform, to buy blockchain-based digital coins instantly from more than 30 countries of the world, excluding the United States and Russia. CEO of Skrill, Lorenzo Pellegrino, stated:

“The world of cryptocurrency trading is exciting and dynamic, and our digital wallet service very much lends itself to this environment.”

Crypto Fund of Novogratz Lost $134 Million in 2018, Investors not Worried

Galaxy Digital, the cryptocurrency hedge fund operated by billionaire investor Mike Novogratz, lost $134 million in the first quarter of 2018 due to the 70 percent correction of the crypto market.

In the first few months of this year, significant digital assets such as bitcoin, ethereum, and bitcoin cash plummeted by 70 to 85 percent, as the crypto market recorded the third-worst correction in its history after 2010 and 2014.

According to Bloomberg, Galaxy Digital recorded $13.5 million of official losses, $85.5 million of unrealized losses on cryptocurrencies, and a $1.1 million paper loss on investments, losing $134 million in total, combined with its $22.9 million paper losses on alternative investments.

The cryptocurrency community recognizes Novogratz and his investment in various cryptocurrencies ranging from Bitcoin to EOS, and over the past 12 months, Novogratz has become an influential investor in the blockchain sector given his background in the traditional finance sector.

Despite the massive loss recorded by the firm in the first and second quarter of 2018, Novogratz emphasized that he remains satisfied with the progress the company has made so far in establishing four core business lines of Galaxy Digital.

Cryptocurrency Exchange Coinbase Partners with Digital Gift Card Platform WeGift

In a significant development on July 25, 2018, influential cryptocurrency exchange Coinbase rolled out a “gift card” feature for its European, British, and Australian clientele. Customers can now purchase various gift cards via supported cryptocurrencies.

As stated in an official announcement, Coinbase has partnered with London-based WeGift, a digital platform that has tie-ups with over 120 retailers across the U.K. WeGift offers real-time, on-demand digital gift cards to customers, powered by a unique API that enables transactions of branded gift cards in any amount across partners.

The point-of-sale for cryptocurrencies, regarding products and services bought in exchange for digital currencies, remains a barren sector. However, the partnership provides a vibrant economy for those interested in spending their cryptocurrencies instead of holding them as a long-term investment or for speculative purposes. The partnership opens a massive avenue in this regard.

As announced, the usage of cryptocurrencies for purchasing WeGift-issued gift cards offers a small “bonus” percentage to users and provides between one to nine percent of the total sales amount. Furthermore, Coinbase will charge a zero-percent fee on such transactions and withdrawals, presumably to increase cryptocurrency adoption in the masses.

Bank of Canada Independent Study Reveals Public’s Perceptions of Bitcoin

A 2017 study by the Bank of Canada was updated by the central bank in July 2018. As a part of the Bitcoin Omnibus Survey (BTCOS), the study provides insights into the public’s purchase reasons for an overall awareness towards cryptocurrencies.

The BTCOS study was earlier conducted in December 2017, at a time when bitcoin and the broader cryptocurrency market were bullish in terms of price action. During this period, participants in the study recorded an 85 percent awareness rate for the pioneer cryptocurrency, with the ownership figure increasing by 2.9 percent to five percent as compared to 2016.

Meanwhile, only 21 percent of Canadians were aware of Bitcoin’s existence in 2016. Interestingly, participants in 2016 purchased bitcoins mainly for transactional purposes, whereas 2017 test-takers viewed the digital asset primarily as an investment vehicle in 2017. Only 2.5 percent of bitcoin owners had used the currency as a means-of-payment or for sending money to others.

China’s Decision to Choose Ethereum over its own Blockchain NEO Is Monumental

The Xiongan government, in charge of building Chinese President Xi Jinping’s dream city “the Xiongan New Area,” has chosen Ethereum over NEO, a local blockchain network, along with its decision to employ New York-based blockchain studio ConsenSys as the blockchain consultant for the Chinese government.

ConsenSys is a blockchain studio with more than 600 Ethereum developers and in-house entrepreneurs that is operated by the network’s co-creator Joseph Lubin. Throughout Asia, Europe, and the U.S., the ConsenSys team has cooperated with regulated financial institutions, governments, and businesses to commercialize the blockchain.

It’s most recent partnership with the Xiongan government, allowed the company to win a contract to extensively evaluate the potential of utilizing blockchain technology to process information and fuel various operations within the Xiongan New Area.

Over the next few years, as a part of the agreement, ConsenSys will develop blockchain tools and software solutions built on top of the Ethereum blockchain to be used by the residents and businesses of the Xiongan New Area.

“As one of our first major projects in the People’s Republic of China, we are excited to help define the many ‘use cases’ that could benefit from the trust infrastructure enabled by ethereum technology,” said Lubin.

The appointment of ConsenSys to lead blockchain development by the Xiongan government was unforeseen by local analysts, given the government has never brought in a foreign company or contractor in completing the construction the Xiongan New Area.

Coinbase Investigation Concludes There Was no Insider Trading Ahead of Bitcoin Cash Launch

Coinbase, the largest cryptocurrency exchange in the U.S. was under unwanted limelight in 2017 when there were concerns that its employees had been a part of insider trading, as the exchange added Bitcoin Cash to its list of assets. Amidst crumbling pressure, Coinbase was forced to start an investigation to look further into the matter, which has reportedly come to an end on July 24, 2018, as per Fortune. It was concluded that no wrong action was taken by any of the firm’s employees.

As reported by BTCManager in December 2018, there was a substantial social downpour on Coinbase employees, that they intentionally took part in unethical business behavior for monetary gains.

Replying to an inquiry by Fortune, Coinbase commented that the investigation came to closure last week, after a month-long probe by two famous law firms in the U.S.

A company spokesperson reported that the independent, voluntary in-house investigation had been closed, and there are no reasons to take any disciplinary action. “We would not hesitate to terminate an employee or contractor and take appropriate legal action if evidence showed our policies were violated,” he added.

An anonymous person close to Coinbase stated that a staff lawyer discussed the outcome of the internal investigation with the employees of the company in a meeting last week.

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