The negative Yielding Debt continues to increase and analysts say that this is good news for the adoption of Bitcoin.
The escalating U.S.-China trade war, political tensions in Italy, Hong Kong and Argentina and disappointing economic data from China to Germany have fueled demand for haven securities this month. Strategists are increasingly speculating Treasury yields could join the below-zero club, something former Federal Reserve Chairman Alan Greenspansaid wouldn’t be that big of a deal.
Government debt around the globe has rallied in sympathy with bets on U.S. rate cuts. German bund yields dropped to a new low in the build-up to the Fed announcement, while Japanese peers rose before the Bank of Japan released its monthly debt-purchase plan.
What if I said I wanted to borrow $100 from you and pay you back $99 five years later?
Would you do it? Of course not.
Yet, this is happening right now with $17,000,000,000,000 of debt with negative yields.
The mother of all financial bubbles.
Buying into the near $17 trillion heap of global bonds with negative yields might sound like a losing proposition. But for some investors those who predicted correctly that bond prices this year would climb amid worries about sluggish global growth, negative yields actually have been a cash cow.
Telegram’s blockchain and cryptocurrency projects, one of the most anticipated in the industry, is approaching its release date. Telegram is one of the biggest social media companies, and it is popular for its privacy and encryption functions. The social media giant’s crypto project is expected to be one of the most valuable in the crypto world when it goes public.
The mainnet launch for the blockchain project, named the Telegram Open Network (TON), is expected on the 31st of October. TON’s trial users expect to receive the node running code on the 1st of September as Telegram moves into the final phases of the project’s preparation.
Comparability with Ethereum
TON Labs has been tasked with developing the network and the tools that developers will need to build new systems of their own. The tech startup received considerable support from investors during Telegram’s token sales, and this has allowed the tech firm to develop more tools for developers.
Various tools have been announced, and each one of these will appeal to a different sector of the blockchain and crypto industry. TON Labs recently announced a Solidity compiler, which will allow Ethereum based applications to be built and run on TON.
Alexander Filatov, CEO of TON Labs, said that the Solidity compiler for Ethereum is one of the most challenging things they’ve had to build. The tool will allow developers in the Ethereum community to move everything they have written for Ethereum to TON. TON Labs has been testing Solidity compiler since July and TON trial users can expect to access this tool.
The TON version being released to TON trial users on the 1st of September is expected to be the last in a series of tests run by TON Labs.
Filatov said that this test run might be the most important of all the ones they’ve run because they have limited time to fix any bugs that may be identified during the tests. There is little time between the release of this test run and the launch of TON’s mainnet.
According to the user agreement signed between Telegram and its investors, the social media company will have to refund all those who bought tokens if the mainnet does not launch on the 31st of October. This makes the trial run being released on the 1st of September even more important because if anything goes wrong, it puts Telegram in a predicament.
Through its token sales, Telegram raised about $1.7 billion as investors poured in to get a piece of the highly anticipated project.
Telegram’s tokens, named GRAM, are already trading on unauthorized markets where investors are already fetching high profits for the tokens before the network is launched officially. Telegram warned that these investors are in contravention of their user agreement and they risk losing their entire share of the GRAM token.
In an age of ever-growing mistrust in the majority of our interactions with banks, the media, government and the advertising and marketing industries have become prevalent, blockchain provides trust. It doesn’t come too much of a surprise that Amazon has shown interest in it.
There is very little in the way of doubt that Amazonreigns on a tall throne when it comes to online retail. The company accounted for roughly 44% of all eCommerce sales in 2017, and a spectacular 4% of all retail from within the United States.
A job posting on LinkedIn last week suggested that Amazon has plans to bring blockchain technology into its advertising products. With global ad fraud predicted to cost an unprecedented $23bn this year, blockchain has been a much-touted solution. The open-source ledger tech at the core of cryptocurrencies such as Bitcoin could also give brands more transparency over their media buys.
An ad exec with knowledge of Amazon’s ad workings said it will have difficulty handling the blockchain trilemma finding the balance between scalability, security, and decentralization.
The underlying philosophy of blockchain is an existential threat to centralized companies like Amazon. The B2B realm has a much more developed ecosystem for blockchain to take advantage of, and Amazon’s existing platforms are already optimized to incorporate the technology with little friction.
While it was initially tied for a long time to cryptocurrency performance, the technology has since shed this relationship and become a power unto itself, making it a key driver of innovation.
A world where the transactions made on your behalf when purchasing such things like AdWords, Facebook Ads, Media buying are all recorded, with a trail that fully discloses the costs, right through the real live data, of what that spending generated for your business.
Billionaire Alan Howard who is the head of Brevan Howard Hedge Fund is looking to make investments in the ever-fluctuating crypto market. Financial Times has confirmed that he is planning to put as much as a $1Billion in the crypto hedge fund.
Notably, Howard made substantial personal investments in cryptocurrencies last year and plans to put more of his own money into digital assets and the blockchain technology behind them.
Brevan Howard’s flagship macro hedge fund recorded its worst ever annual performance last year. Like some other hedge funds betting on economic trends in developed markets, a lack of volatility amid years of central-bank stimulus made it difficult to make money. Now, they seek to capitalize on the volatility of the crypto markets.
“Losing traditional assets in the real world is hard. In the digital world, it’s very easy to lose assets — put in the wrong address for a bitcoin transfer and it’s gone forever,” said Bin Ren who is the CEO of blockchain funds specialist at Elwood.
Ren was earlier the Cheif Invetment Officer at revan Howard’s Systemic Investment Group. He added that screening of the sector had resulted in Elwood identifying up to 50 crypto hedge funds as probably satisfy our due diligence.
While 2018 saw a 72% fall in the price of Bitcoin, the median crypto hedge fund returned -46% over the same period, indicating that these managers were successfully able to outperform their benchmark. However, performance differed based on the type of strategy pursued. The median quantitative fund returned 8% in 2018.
The massive percentage growth of Bitcoin, even in the face of extreme stress testing, has legitimized it in the eyes of investors everywhere. Bitcoin remains a small percentage of the hedge fund industry, but even the oldest and most established funds can see what’s coming.
This broader interest from investors and regulators is undoubtedly a positive step towards digital assets being recognized as an asset class with true viability and longevity.
50,000 BTC were withdrawn from the platform in July
During this time, Binance flows rose dramatically
In July, the US regulator Commodity and Futures Trading Commission (CFTC) started probing BitMEX, a leading crypto derivatives platform that offers 100x margin trading services to non-accredited investors.
The months-long probe is focused on whether the derivatives platform — not registered with the agency — broke rules by allowing Americans to trade. This could be what spooked investors and resulted in a massive Bitcoin outflow from the exchange.
That month, nearly 40,000 BTC were withdrawn from the platform. However, according to Token Analyst, this number was higher at 50,000 BTC equivalent to $524 million.
Analyst, Ceteris Paribus first pointed this out in early August,
“Bitmex had $524M net outflows in July. It had never had more than $100M in a single month. 2018 brought in $1.3B, and there was not a single month where outflows were greater than inflows.”
However, BitMEX Research begs to differ as it states that BitMEX net flow figures by the Token Analyst have “begun to deviate significantly from the actuals in the last 4 months.”
This, it wrote can be checked by using the blockchain balances of 3BMEX and 3BitMEX addresses.
Binance Beats BitMEX
However, the drastic outflow is still obvious and CFTC probing into the exchange is not the only factor behind the big shot to BitMEX’s outflows. Binance could be another factor.
The world’s leading cryptocurrency exchange announced margin trading platform (3x) — in comparison to 100x on BitMEX — in July, a few days before the investigation into BitMEX.
“Activity did a 180 in June. First thought was traders entering alts, but beta margin trading opened in June, and the large spike in July is right before they opened it to everyone,” Ceteris Paribus observed about inflows and outflows on Binance.
He further made note of the stats, in comparison to $66 million in net flows between January 1st to June 13 (ex. May downtime), from June 14 to 26 July, $192 million were recorded in Bitcoin flows.
“Not only have inflows outpaced outflows recently, but total average dollars being deposited/withdrawn have spiked 3x as well,” he said about Bitcoin flows.
July, however, has been a bad month for Bitcoin as price went down to $9,150 level. The situation has started to get better but it’s still not made its way back to early 2019 levels.
Police continue attempting to arrest people arriving from Tung Chung or Mui Wo. All alighting passengers would be stopped and searched.
Source: Apple Daily
民間記者會 The Citizens’ Press Conference
Freedom Hong Kong
九校聯罷 9 Secondary Schools in the Joint-Strike
中學生反修例關注組 AntiFoo HKSS
香港大學反送中關注組 HKU Anti-Extradition Concern Group
跨界別罷工籌備組 Cross-sectional Strike Preperation Group
居德港人聯合行動組 HongKongers in Germany Concern Group
Comité pour la Liberté à Hongkong
DC4HK – Washington DC Hong Kongers
Hong Kong Forum, Los Angeles 洛杉磯香港論壇
HongKongers in Germany Concern Group
HongKongers in Houston
Netherlands for Hong Kong
New Yorkers supporting Hong Kong
New Zealand Hong Konger
Northern California Hong Kong Club 北加州香港會
SEArious For HKG 西雅圖香港民主監察小組
Stand with Hong Kong (Belgium)
Toronto Association for Democracy in China
Torontonian HongKongers Action Group
Vancouver Society in Support of Democratic Movement
Police have left the platform. Middle-aged man inside the train compartment condemns MTR’s arrangement and asks the train to start again so everyone can leave safely.
1904 Police inside the Train compartment claims the upper floor is secured by the police and is very safe. He then suggests civilians to take other transportations to leave, but most civilians seem to feel helpless as they are still worried for their safety.
Source: Apple Daily & Cable TV
1917 Fu Tung Estate, Tung Chung
Riot police, Special Tactical Sqaud and plainclothes officers stood guard outside the estate. Riot police asked the press to leave because the police could fire shots any time. Reporters said this may not comply with police guidelines.
Source: Stand News
1956 Central Ferry Pier
Over 50 riot police stood guard to stop and search passengers stepping off the ferry. Some passengers were taken to the side and a police cordon line was set up to restrict access to the area.
Customers of the restaurant industry giant, popular burger Franchise that has over ten thousand outlets worldwide, Burger King can now buy their favorite meals while paying with bitcoins on the restaurant’s mobile application.
This news comes after customers of Burger King in Germany noticed an integration of cryptocurrency payment method on the Burger King’s mobile application which now features the Bitcoin option amid other alternatives like Visa card payments and PayPal.
Burger King, whose progenitor company was Insta-Burger King, is a burger franchise which sells hamburger, chicken, French fries, desserts, milkshakes, and salads to customers at more than ten thousand locations across the globe, also having plans of substantial growth across China, Russia, India and Brazil for an extra 3000 outlets.
Burger King Partners With Tillster For A Mobile Payment Solution
According to a report by retail dive, Burger King built a mobile application in order to quickly scale up in payment. At the time, Burger King partnered with Tillster, a San Diego mobile payment solution company in order to adjust to their ever-growing customer base and their demands for a rapid, scalable payment system.
According to Perse Faily, CEO of Tillster, San Diego, CA,
“When used and implemented, mobile payments provide advantages to both, the brand and the consumer, enabling a two-way dialogue as opposed to a one-way transaction,” said Perse Faily, CEO of Tillster, San Diego, CA. “For consumers, they are able to utilize a convenient easy way to pay for their goods and opt-in to additional services that brands are developing, with Tillster’s help, such as loyalty programs, exclusive coupons, and other engagement tools.”
Now, in their pursuit of a more efficient and rapidly evolving payment options, Burger King in Germany has incorporated Bitcoin payments into their mobile platform.
In 2017, according to South China Morning Post, Burger King dived into the crypto space by developing native cryptocurrency issues to incentivize customers in Russia for buying hamburgers and sandwiches. With each purchase of the burger chain’s signature Whopper sandwich, customers can receive WhopperCoin, Burger King’s tokens via a digital wallet.
The hashrate of the Bitcoin network, which demonstrates the amount of computing power used to secure the protocol to process transactions, achieved a new all-time high at 83 exahashes.
At the start of the year, the hashrate of the Bitcoin network was hovering at 35 exahashes, showing a 137 percent increase within an eight-month span.
What the hashrate says about Bitcoin’s trend
In mid-2020, the Bitcoin blockchain network is expected to go to through a mechanism called a block reward halving, which would reduce the revenues received by BTC miners by 50 percent.
The halving would substantially decrease the amount of BTC mined by miners. These coins are passed on to the market through exchanges and over-the-counter (OTC) operations, putting downward pressure on the price of BTC. Historically, the block reward halving of the Bitcoin network acted as a fundamental catalystfor the medium to long term price trend of the coin by decreasing the rate of BTC emission (and thus decreasing supply inflation).
Something to note, however, is that the halvingalso tends to reduce the overall hashrate of a proof-of-work network, in line with lower miner revenues. This may make BTC less secure to 51% attack.
The rise in the hashrate of the Bitcoin network prior to the halving may show that a growing number of miners intend to mine as much BTC as possible before mid-2020 in anticipation of price recovery of the dominant cryptocurrency.
In July, BKCM founder Brian Kelly stated that many miners have acquired enough capital to fund the next 12 months of operations to hold onto BTC they mine throughout 2019 and the first half of 2020.
“I’ve talked to a lot of miners around the world, a lot of them have said they have sold enough bitcoin to get us through the next year or so and we are going to hoard bitcoin at this point in time and we are not going to sell it and the supply of bitcoin will get cut in half. Just real simple economics: lots of demand hitting little supply, price goes higher,” said Kelly on CNBC’s Fast Money.
If miners are sustaining their operations without selling BTC on exchanges or OTC markets to cover expenses, it indicates that miners foresee the Bitcoin price to perform well in the medium to long term despite the recent pullback.
For the sixth time this quarter, the Bitcoin price has dipped below a key psychological level at $10,000, testing a range support between $9,400 to $9,700. Several technical analysts said that as the support range for BTC weakens it increases possibility that BTC tests a stronger support level in the $8,000 region in the near term.
“Currently holding above the previous low on the daily close but if price breaks down, it’s going to the $8.7ks. After that, it heads towards $8k but everyone is watching it so either it bounces before or goes through. Needs to break back above $10,100 to get bullish,” technical analyst Josh Rager said.
It remains uncertain whether the launch of Bakkt, a physically-settled Bitcoin futures contractoffering market on September 23, could overturn the short term downside of BTC considering the weakness the asset has portrayed since early August against the U.S. dollar.
A capacity crisis is roiling Ethereum as it hits a historic low against Bitcoin. Although declining prices appear to be part of a broader corrective trend, some analysts argue hiccups in the protocol’s development are the root cause. Meanwhile, Vitalik Buterin claims salvation via ETH 2.0.
“The Ethereum blockchain is almost full”
Ethereum’s network utilization recently surpassed90 percent, according to Etherscan. The surge in transactions is a clear sign of adoption. Yet, the Ethereum blockchain does not have the throughput to handle this traffic. This leads to network congestion and high fees.
The reason behind the spike in network utilization? Tether, potentially.
Tether’s USDT is steadily migrating from the Omni to Ethereum blockchain. More than 40 percent of USDT is now using the ERC20 standard, as Anthony Sassano, an Ethereum developer and head of marketing at Set Protocol, pointed out.
As network load increases the cost of processing these transactions also increases. Functionally, this makes user-friendly dApps difficult, stifling adoption. Several startups that previously launched as ERC20 tokens are even migrating away from Ethereum because of these limitations.
Migrating away from Ethereum?
Now, some of the most popular decentralized applications are running on competing smart contract platforms. MyWish, a platform that helps people budget using smart contracts, announcedearlier this year that it is migrating to Binance Chain.
EOS and TRON are also absorbing dApp share from incumbent Ethereum, according to Dapp Radar. Because these protocols boast much higher transaction throughput, at the cost of centralization, they can run more sophisticated gambling and gaming dApps.
Ethereum is currently characterized by a 15 transactions per second bottleneck. Centralized databases can easily handle thousands of transactions, while EOS and TRON can do anywhere from 25–100 based on live tests (though they publicly claim much higher numbers).
The transaction bottleneck impedes Ethereumfrom realizing its potential as a widely adopted “world computer.” Even Vitalik Buterin, the protocol’s figurehead and co-founder, raised these concerns.
“Scalability is a big bottleneck because the Ethereum blockchain is almost full. If you’re a bigger organization, the calculus is that if we join, it will not only be more full but we will be competing with everyone for transaction space. It’s already expensive and it will be even five times more expensive because of us.”
In response to these growing concerns, Ethereumis scheduled to make two major updates in the next six months that will help fix these issues, claims Buterin.
The first hard fork is set to occur in October, with Ethereum developers recently finalizing a list of six different changes. The system-wide upgrade, dubbed Istanbul, is expected to boost chain interoperability with Zcash and improve denial-of-service attack resilience, among other efficiency improvements.
The second, more ambitious update is Ethereum 2.0 (Serenity). Scheduled for mainnet activation sometime in the first quarter of next year, it is the most anticipated Ethereum hard upgrade and hard fork.
The long-awaited upgrade aims to help the network support “millions of transactions per second” via second-layer solutions, including Sharding and Plasma. In a May video, Vitalik Buterin explained how these two solutions work in tandem.
“The reason I think layer 1 and layer 2 are complementary is because ultimately, if you look at the math, the scalability gains from the layer 1 improvements and layer 2 improvements do ultimately multiply with each other. If you have a Sharding solution, the Sharding solution itself might increase the scalability of Ethereum by a factor of 100, or eventually even more.”
Due to the importance of the upgrade, the Ethereum Foundation recently announced grants worth more than $2 million. The capital is destined to seven different companies that are “currently tasked with delivering long-standing multi-client testnets” for Serenity.
Ethereum price analysis
Despite efforts to upgrade the network, the price of Ethereum continues retracing. In fact, the ETH/BTC pair has never traded lower except for the first 7 months after it launched in July 20, 2015, and during a short period of time before the beginning of the 2017 bull market.
Correspondingly, following the 55 percent correction that began on June 26, the ETH/USD pair is currently trading around $167. This price point represents a significant level of support for Ethereum. During the beginning of the year it also acted as a strong barrier containing the price of ETH from going up on several occasions. Now, it could prevent it from a further drop.
If the $167 support level indeed holds, there are two bullish patterns that could allow Ethereum to rebound from this area.
The first one is a falling wedge that appears to be developing on the 3-day. This is a technical formation that signals a price reversal from bearishto bullish. Upon the breakout point, the falling wedge predicts a 38 percent surge that could take ETH to $242.
The second pattern is a red nine candlestick that could form on Sept. 1, per the TD sequential indicator. This technical index forecasts a three-to-twelve days upswing or the beginning of a new countdown that could start around Sept. 4, if validated.
A combination of the strong support level, with the falling wedge, and the upcoming buy signal from the TD sequential indicator could have the potential to resume the bullish trend that began in mid-December 2018. The last indicator that will confirm the bullish outlook is a spike in volume.
Nonetheless, if Ethereum is bound to continue falling it may try and test the next level of support around $145.
It remains to be seen if the different bullish signals presented will allow ETH to recover in terms of its dollar value.
For for everyone, not just investors, the upcoming upgrades to Ethereum (if successful) will drastically improve the fundamentals of the coin. If the network is finally able to fulfill its promises of conducting millions of transactions per second then it will substantially accelerate adoption. And, hopefully, redeem its price against Bitcoin.