Market report


London Block Exchange

8th May 2018

On non-events, fake hoaxes, and alt seasons


On non-events, fake hoaxes, and alt seasons

It’s startling to see the distress signals within the crypto community after yesterday’s May Day bank holiday. A lot seems to have happened, yet there was such little impact. As usual, let’s aim to analyse the context and obtain some critical comfort.

The main topic of contention was yesterday’s SEC and CFTC meeting, which turned out to be a non-event. Nevertheless, Twitter started playing Chinese whispers — prompting some investors to think the group meeting, which was behind closed doors, was going to be a public hearing. It was not a hoax though, just a matter of misinformation. Once the general public understood what the original Wall Street Journal piece — the only original source for the meeting — meant, everyone stopped selling the bottom. However, was it really the bottom?

The weekend was full of shenanigans. Another event included bitcoin’s test of £7.4k ($10k). It failed to break above the key symbolic level and quickly declined back to £6.7k ($9.1k) as traders seized the short opportunity to take profits. The coming week will be key to establish possible bullish signals, so keep an eye out. Current consensus is that if bitcoin breaks £6.9k ($9.4k) today it’s a positive sign. Nevertheless, some claim bitcoin will continue to trade sideways for a while until it loses enough share of the total market cap to alternative cryptoassets. We believe this alt season analysis is fragile but it’s still worth a read!


On TV interviews, TV shows, and dead cat bounces

What really dominated yesterday’s discourse were the virally unfortunate remarks made over the weekend by Warren Buffett, Charlie Munger, and Bill Gates during a CNBC interview. It seems two of the top three world’s billionaires feel threatened by the quick recovery of the main cryptoassets behind the personal banking revolution.

While some popular economists enjoy being famous for having predicted 13 of the last two economic crises, will some well-renowned investors go down in history for missing all recent tech waves? Or tech-wave pioneers become even more famous for missing another boat after failing to surf the mobile and personal computers revolution?

It’s important not to dismiss these remarks as some did for personal profit. Personal banking can also mean easier bribing — as featured in a famous TV show yesterday. These people added enormous value to the world economy and a defensive reaction to all the speculation is almost legitimate. By their own words, they would not have their views if they understood what cryptoassets are — “the fuel that powers a new form of technology infrastructure that is being built on top of the foundational internet protocols”. Look out for Willy Woo’s latest NVT Ratio analysis to understand whether that fuel is running out or not — bitcoin dead cat bounce incoming?


Filter the noise and stay ahead of the pack

  • U.S’ Congress is holding a blockchain-focused informative hearing today. It concerns supply-chain use cases and not much information is available so far. Meanwhile, learn more about how supply-chain and trade finance are benefiting from blockchain tech.

  • Privacy-focused cryptoassets are getting some support. Circle, the Goldman-backed crypto startup is now offering monero and zcash in its US-only investment app. Note Monero is facing some fresh forking FUD but “there’s literally nothing happening”.

  • Blockchain Summit Latam is starting today in Santiago, Chile. With a good agenda and great speakers — including Chris Burniske, Malcolm Lerider, and Meltem Demirors, it’s worth a follow. Check their Twitter and watch the livestream from 13:00 BST onwards.


An insight a day could give you more profits to play

  • Harvard Business Review asks “as cryptocurrencies rise, who needs banks?”. They get that “the advantage of crypto is not that they are electronic currencies”, but their concluding thoughts are about making “payment transfer a central bank function”.

  • Changpeng Zhao argues ICOs are “not just good-to-have, but necessary”. Binance’s CEO praises how much easier it is to fundraise through an ICO than through traditional VC firms, the power of the crowd, and the benefits for smaller investors.

  • Chris McCann compares cryptoassets to the internet and presents “12 graphs that show just how early the market is”. The Greylock Partners collaborator believes we are still in 1994 — a common remark — but acknowledges the analogy might not be the best.

  • BTC
  • SEC
  • CFTC
  • Warren Buffett
  • Charlie Munger
  • Bill Gates
  • dead cat bounce
  • Monero
  • Zcash
  • ICO
  • fork
  • blockchain
  • CNBC
  • bitcoin