Market report

THE TRUST MACHINE

London Block Exchange

15th January 2017

People rightfully trust blockchain — but do they trust exchanges?

THE TRUST MACHINE

People rightfully trust blockchain — but do they trust exchanges?

The past week has seen no overall growth of the total cryptoassets market — since 8th January the total market cap hasn’t surpassed the £600 billion ($800 billion) threshold. This was mostly due to the infamous CoinMarketCap call.

The unexpected decision of a leading data provider to remove Korean exchanges from the rankings cut off around 12% of global cryptoasset valuation in one go. Further FUD caused by the Korean Ministry of Justice helped the weekly downtrend.

Korea is still divided, but this weekend the market has been consolidating sideways in a rather healthy way. Against all odds, it reacted quite maturely to what will likely become one the most important and shocking events of 2018 — a major breach of trust.

Kraken is (was?) one of the most respected exchanges in the field. Despite not having the most sophisticated trading engine, it was perceived as one of the most reliable, given its history and its role in reviving bitcoin’s reputation after the 2014 Mt. Gox hack.

However, the fifth-largest exchange has failed their customers. The promised update started on Thursday and was supposed to take two hours — it was actually ready two days later! There was some communication, but it was infrequent and some customers panicked.

The exchange went offline for almost 60 hours and withdrawals were only re-established today. Threats of legal action surged on Twitter as customers thought Kraken was beginning to resemble Mt. Gox itself. Some say it’s even the death of centralized exchanges!

Funds were considered to be safe but it’s remarkable that, after two anxious days, bears didn’t take the opportunity to ‘release the kraken’ in the rest of the markets. This can either be a sign of a developed market or of just blind trust!

THE NEW NEO RISES AGAIN

Smart contract platforms are becoming key blockchain use cases.

Over the past 24 hours, only 20 out of the top 100 cryptoassets by market cap have managed to appreciate. One project that stands strong is Neo, which in 2017 alone provided a 500x return to investors.

Neo is smart contracts platform, somewhat analogous to Ethereum’s platform. They are very different, but one of the key points is that NEO is focused in promoting the digitization of physical assets with the goal of creating a smarter economy.

Its platform has two tokens — GAS, which functions like Ethereum’s ether in the sense that it powers transactions in the network; and NEO, an indivisible token that essentially represents shares in Neo’s ecosystem and allows for voting rights.

After having rebranded from Antshares last August, Neo struggled to grow from September onwards after reports of a Chinese crackdown on investment. As Neo was dubbed ‘China’s first blockchain platform’, it took a while to recover.

Neo is also more centralized than the other popular projects in the cryptosphere and people have become wary of the power concentrated with its key developers. We’ll keep our eye on it as it continues its parabolic rise!

WHAT TO LOOK OUT FOR TODAY

To prepare for tomorrow!

GDAX, Coinbase’s exchange, is resuming trading of the Bitcoin Cash/Bitcoin trading pair this Wednesday at 5 PM GMT. What will happen?

EOS, the largest ICO in history (after raising 2.5 million ether, around £1.25 billion — yes, billion!) is supposedly launching big news. Do your own research here!

WCEF, or the World Crypto Economic Forum, is starting today in San Francisco and the North American Bitcoin Conference starts Wednesday in Miami!

ARTICLES OF THE DAY

An insight a day keeps the red candles away

Bitcoin’s Lighting Network is a new layer of the Bitcoin protocol that can make the mother of all cryptoassets a fully functional cryptocurrency again. Learn more!

With GDAX resuming Bitcoin Cash trading, it’s good to recap the great civil war of 2017. Is there a ‘real Bitcoin’ and why is Bitcoin Cash perceived as hostile?

Ark Invest, the first public fund manager to invest in bitcoin back in 2015, has released their ‘Big Ideas’ for 2018. The crypto section starts at page 43 — find a summary here!

  • Coin Market Cap
  • Korea
  • Mt. Gox
  • GAS
  • NEO
  • EOS
  • Lightning Netowork