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Sustained Break of $7000 Elusive for Bitcoin, Entrance of the Big Names in Finance: Week in Review Apr. 10

Sustained Break of $7000 Elusive for Bitcoin, Entrance of the Big Names in Finance: Week in Review Apr. 10

Reading Time: 6 minutes by on April 10, 2018 News Digest
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In the past seven days, the price of bitcoin trading in a range between $7,500 and $6,500, closing the week effectively unchanged and unable to sustain above $7000. The altcoin market largely moved in tandem with its pioneering predecessor and no major gains or losses were made in leading digital assets.

While the bulls believe that the worst is behind us, the bears consider it a very real possibility that we could see new lows in the coming months before the market turns around again. Experts cite the remaining Mt.Gox BTC/BCH bankruptcy funds that still need to be sold as well as traders cashing out profits to cover upcoming capital gains tax payments as the main reasons for the heavy market in recent weeks.

While price action remains rather muted for crypto standards in the past week, there was enough controversy to keep the community entertained.

It came to light that outspoken entrepreneur John McAfee has been getting paid over $100,000 to promote altcoins on his Twitter account, which has often led to price spikes for small unknown coins.

The past week also saw Vitalik Buterin live-tweeting his thoughts on the heated debate between Roger Ver and Samson Mow during the Deconomy Conference in Seoul, South Korea. The debate itself brought the Bitcoin scaling debate and the Bitcoin versus Bitcoin Cash feud back into the forefront of the community.

Buterin also called out Craig Wright as a fraud during the conference, asking the organizers: “Why is this fraud allowed to speak at this conference?,” a view shared by Lightning Network creator Joseph Poon.

This week’s contributions have been provided by Jamie Holmes, Ogwu Osaemezu Emmanuel, Priyeshu Garg, and Shaurya Malwa.

Coinbase to Launch Venture Fund for Blockchain Startups and Offer Support for Bitcoin Forks

Coinbase is set to launch an early-stage venture fund for crypto and blockchain startups. The fund was made known to CNBC on Thursday, April 5, 2018, by Asiff Hirji, the President and COO of the firm. According to Hirji, the investment fund is already worth $15 million at the start of the initiative, and it is expected to grow. Hirji declared that the investment fund is coming right out of the company’s balance sheets.

The fund will be used to provide seed-stage investments in a number of blockchain and crypto startups starting in the next few days, according to Hirji. Coinbase wishes to provide the necessary funding catalyst that will spark the emergence of viable ideas into potentially profitable blockchain and crypto enterprises that will benefit the industry.

In other Coinbase news, the company recently announced that it would begin to offer withdrawal support for certain bitcoin forks in the coming months. The update was made known via a post on the company’s Medium account on Thursday, April 5, 2018.

Skype is Now Part of the Crypto Action

Online messaging – notably Skype – is facilitating the trade that involves some 20 traders at various houses. Reuters reports that mostly bigger investors try to avoid generating turbulence on the online exchanges and are rather doing business via Skype.

The founder of crypto-focused hedge fund Galois Capital, Kevin Zhou, said that “Generally, you would go trade through an OTC desk when you have a large block trade you want to do without moving the market too much or incurring too much slippage.”

The traders identified all work at visible players in the industry, firms such as financial service provider Circle, Cumberland Mining, a division of the proprietary trading firm DRW Holdings and the Digital Currency Group’s New York broker-dealer Genesis Global Trading. Circle is the Goldman Sachs-backed company that, in spite of the parent company’s supposed aversion, recently acquired the Poloniex exchange.

George Soros Makes U-turn, Set to Trade Cryptocurrency

It appears George Soros has made a U-turn on his stance regarding the crypto market or, at the very least, is prepared to get in on some of the action. This news is based on a report that his family office is set to begin trading in cryptocurrencies. George Soros like a number of prominent figures in the mainstream financial scene once described bitcoin as being a bubble. While people like Warren Buffet appear not to be going near cryptos anytime soon, it seems George Soros has had a change of heart.

According to a recent article on Bloomberg, Adam Fischer, the macro investment manager of the Soros Fund Management firm has been given internal approval to begin trading cryptocurrencies.

The Soros Fund Management firm is reportedly worth $26 billion. Unconfirmed reports also reveal that though Fischer has been given the go-ahead, no trades have been made as of yet and there is no official word on when trading will commence.

Despite his reservations about bitcoin and cryptocurrencies in general, Soros has indirectly been placing wagers on the market. The Soros Fund Management firm has been able to amass a considerable portion of shares.

India Bans Banks from Dealing With Crypto Businesses, Says it Would Launch its Own Coin

In a startling move, the Reserve Bank Of India (RBI) virtually banned cryptocurrencies on April 5, 2018, as they passed a mandate which bars banks and regulated financial institutions from providing services to any individual or business dealing in digital currencies.

As part of its move, the bank gave an ultimatum of three months to all banks in the country to allow them to cut ties with, and stop services for any cryptocurrency businesses including exchanges and wallet providers.

The report acknowledged blockchain technology and said it would promote the decentralized public ledger for use in the country’s financial sector. However, the RBI noted that virtual currencies, also variously referred to as cryptocurrencies and crypto assets, raise concerns of consumer protection, market integrity, and money laundering.

The move was taken after “three warnings” were given to the public against dealing with cryptocurrencies. In a short-sighted statement, the RBI deputy said, “If [cryptocurrencies] grow beyond a critical size they can endanger financial stability.”

Early in February 2018, Indian Finance Minister Arun Jaitley stated that the government does not consider cryptocurrencies as legal tender and will take all measures to eliminate payments used to fund nefarious activities in the country.

Japan on the Verge of Legalizing Initial Coin Offerings (ICOs)

According to reports, a task force backed by the Japanese government has formulated guidelines aimed at regulating and legalizing initial coin offerings (ICOs).

On April 5, 2018, Japan’s Business Research Group drafted a proposal requesting that the government regulate ICOs in a non-draconian way that would protect investors’ interests and encourage the growth of the nascent ICO industry.

As reported by Bloomberg, Japan’s Financial Services Agency (FSA) will take a critical look at the proposal a few weeks from now. If everything works according to plan and the bill gets accepted, it could become law in a few years time – a development that will undoubtedly restore Japan’s lead in the ‘cryptosphere’ and exchanges that have left the nation due to recent regulatory bottlenecks may likely come back.

“ICOs are groundbreaking technology, so if we can implement good principles and rules, they have the potential to become a new way to raise funding,” said Kenji Harashima, a researcher at Mizuho Research Institute.

Monero’s Scheduled Upgrade to Soon Reveal the Extent of ‘Secretive’ ASIC Mining

On April 6, Monero conducted its bi-annual scheduled upgrade, or hard fork, to increase the minimum ring size and alter the Proof of Work to nullify Bitmain’s ASIC miners. As for the success of the move, the next ten days or so will inform us of the effectiveness of the controversial decision by the Monero developers to stamp out ASICs.

The hard fork took place on the morning of April 6 on block number 1,546,000 after a lengthy debate on the desirability of a move to nullify ASIC miners. It is thought that the massive increase in Monero’s hashrate toward the end of 2017 were ASIC miners mining secretively. Bitmain only announced their miners for sale on April 3, after the developers decided to change the Proof of Work algorithm as indicated by a post from February. The tweak does not affect GPU or CPU miners, but only affects ASICs.

Spanish Tax Authority Set for Showdown Over Crypto Tax Evasion

The Agencia Estatal de Administración Tributaria (AEAT), more commonly known as the Agencia Tributaria, the tax agency of the Spanish government is set to take a hard-line stance on what it suspects to be tax evasion activities aided and abetted by cryptocurrencies.

According to reports in the local Spanish media, the country’s tax agency has requested for names and trading data pertaining to crypto traders. These requests have been made to a total of 60 finance companies.

Commenting on the development, an unnamed source revealed that the firms that have been asked to turn over crypto buyer information include banks, crypto trading platforms, and even securities firms.

It is reported to be the most significant action ever taken by the government in its quest to prevent cryptocurrency from being used as an avenue for tax evasion and money laundering activities.

The move is reported to have come about as a consequence of an investigation carried out by the National Fraud Investigation Office. The investigative probe examined the bank accounts of foreign-exchange platforms.

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