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Crypto week #1: Proof of Keys, Tokenized trading, Bitcoin anniversary
January 06  |  8 min read

Crypto Week #1 Overview

COIN360 Editorial Team

Happy New Year!

2018 is gone, and the crypto world is saying good riddance. Sources are hoping against hope that last year has taken the so-called “crash” with it, and that the new year may usher in development for the still primitive cryptocurrency market.

Here’s what you need to know about the first week of 2019:

1. Market review

We ended last week in the green, all coins recovering meekly from that sharp dive that hit late on Thursday 27th. Expectations for this week were high, but not even Bitcoin’s 10 year anniversary could pull the coin back over the $4K mark. Since Sunday 30th, BTC has seen a decline that continued all the week, reaching a low point at $3,709, on Tuesday 1st – still a 1.9% gain on last week’s lowest point. Unsurprisingly, the week’s peak, $3,945, came on the aforementioned anniversary, January 3rd. At press time, Bitcoin stands at $3,910, a 1.86% gain on the day a 1.99% loss on the week.

Ethereum’s 7 day graph does not mirror Bitcoin’s. The altcoin was able to ride last Friday’s rally for a full week more, reaching its Christmas Eve rally peak of $156. Hovering steadily between $140 and $133 from the 31st till early on the 2nd, ETH shot up that same day and peaked at $156 twice, on Thursday 3rd and today Friday 4th. This is an 87.9% gain on ETH’s lowest point of the year. Thanks to its good ride this week, ETH reclaimed its position as the second largest cryptocurrency. At press time, ETH stands at $161, for a 8.26% gain on the day and a 13% gain on the week.

EOS started the week at $2.69 on the 31st and bottomed at $2.53 on the 1st. That day, CEO Brendan Blumer took to Twitter to suggest “Voter Rebates” for EOS: that EOS allow block producers to formally pay dividends to users who provide their stakes. If implemented correctly, this could increase the altcoin’s value. Following this announcement, the coin’s value began to trend upwards and peaked at $2.90 on Thursday 3rd, a 14.6% recovery from the week’s low point. Today EOS has dipped back down to $2.64 but at press time has recovered to $2.80, a 4.35% gain on the day and 1.97% gain on the week.

After several weeks as the biggest altcoin, Ripple has fallen behind Ethereum once more. By January 2nd, Ethereum’s market cap was $1B larger than Ripple’s. XRP peaked twice this week; once at $0.370 on Monday 31st and once at $0.377 on Thursday 3rd. At press time XRP stands at $0.362, a 0.69% gain on the day and a 4.57% loss on the week.

Finally, TRON (who’s team, as we learned this week through Justin Sun’s twitter account, has grown from two to forty engineers in 2018) had a “v” shaped trend this week. Monday 31st started off at $0.0199 and kept sinking until $0.0187 on Tuesday 1st. The coin has been recovering since, peaking at $0.0218 earlier today, a 16.5% recovery from the week’s low. At press time, Tron stands at $0.022, an 11.87% gain on the day and a 3.49% gain on the week.

2. Proof of Keys flashmob

This year, January 3rd was not just Bitcoin’s anniversary but also the date of the co-called Proof of Keys event. Sparked by investor Trace Mayer, this event was a call for exchange users to withdraw their crypto funds from centralized trading platforms in order to reclaim “monetary sovereignty” and to put the platforms’ BTC solvency to the test. The campaign got stronger on January 1st, when Mayer, later backed up by John McAfee and Tuur Demeester, accused the exchange HitBTC of purposefully freezing accounts in preparation for Proof of Keys. HitBTC has since contacted media outlets to dismiss this accusation and explain that their users accounts are sometimes temporarily frozen when security measures are triggered.

The Blockchain Transparency Institute has said before that at least some exchanges must be lying about their volume, on account of the size of the market. Recently Bithumb has been accused of reporting volumes ten times higher than the likely truth.

3. Stock markets: tokenized stock trading, Bakkt secures $182.5M in funds

The Estonia-based digital trading platform Exchange DX will become the first EU-regulated exchange to offer tokenized stock trading. This means that users will buy Ethereum-based tokens that are backed 1:1 by stock in several major companies, including Amazon, Google, and Facebook. DX will be powered by Nasdaq’s Financial Information exchange (FIX) and relies on partner MPS MarketPlace Securities Ltd to purchase the stock on users’ behalf.

In other stock market news, Bakkt, the digital assets platform created by the operator of the NYSE (The Intercontinental Exchange), completed a $182.5M funding round with 12 partners and investors. It is expected that the upcoming launch of Bakkt Bitcoin (USD) Daily Futures Contract – to be announced in early 2019 – will affect the crypto market positively.

4. International regulation and adoption

New York assemblyman Clyde Vanel announced on January 3rd that this state will be the first in the United States to have a Cryptocurrency Task Force. This organism will study regulation, use, and definition of cryptocurrencies. Following the same positive trend, South Africa has created a crypto assets regulatory working group which will release a research paper during this year. The country’s Revenue Service is also planning to include cryptocurrencies in the tax forms for 2020.

In another positive step in regulation, a Chilean anti-monopoly court has ruled in favor of forcing banks to reopen local cryptocurrency exchange’s accounts, which had been closed after the country’s Supreme Court decided to protect bank’s right to refuse them service. On the other hand, both the Indian and Iranian governments are warning citizens against crypto. This week, India’s local Business Standard quoted a government inspector as saying "The general public is informed not to make any type of investment in cryptocurrencies, (...) because there is a real and heightened risk associated with them”. Finally, the Tehran Times reported that Iran’s Secretary of Criminal Content Definition Task Force issued a warning saying that any support offered to Telegram’s Gram coin would constitute a breach of national security. Telegram was banned in Iran last year.

5. Circle facilitates $24B in trades in 2018

Circle, the digital payments company, has facilitated over $24B in OTC trading in 2018, as stated in an announcement on January 3rd. The company claimed that over 600 counter parties executed over 10K trades in 2018, and that they’ve become a core liquidity provider of the crypto ecosystem. Circle counts with more than 1K institutional clients, including as exchanges, token projects, OTC desks, asset managers, etc. The post further read:

“This year, we anticipate further incremental growth in institutional adoption catalyzed by stablecoin usage, advancements in institutional custody solutions, increasing regulatory clarity particularly in the (United States), and improvements and innovation in core crypto infrastructure.”

6. Bitcoin 10 years anniversary

This week the crypto community celebrated ten years since the genesis block of Bitcoin blockchain was first mined (January 3, 2009, at 18:15:05 UTC). News of the day included a first page ad on the British daily The Times reading “Thanks Satoshi. We owe you one. Happy 10th Birthday, Bitcoin.” Choosing The Times was, of course, no coincidence; it’s a nod towards the fact that Bitcoin’s first ever block contained encoded a headline from the same daily, which read “Chancellor on brink of second bailout for banks”.

Many placed high expectations to see a rally on such a special occasion, and though Bitcoin did gain 6% on the week’s low point, it was not enough to surpass the $4K psychological barrier.

7. Uneventful 2019 as Blockchain Becomes Mainstream

MIT Technology Review reflects on Blockchains Bull run of 2017 alongside a Bear market downfall in 2018 as cryptocurrencies become mainstream for a steady 2019. Although it seems Bitcoin has bottomed, the normalization of blockchain could lead to new growth patterns unseen since 2017.

As Walmart implements blockchain for food supply tracking, Maduro continues with Petro -a cryptocurrency backed by Venezuelan oil- and investment firms like Fidelity build digital assets managers, the normalization of blockchain continues to show growth in 2019. Blockchain-based programs will continue to lead 2019 into an age of digital transformation.

8. 9/11 Documents and Dublin’s Light Rail System Hacked

The Dark Overload, known for leaking episodes of Netflix original, Orange is the New Black, has struck once again for the greater good in efforts to confirm 9/11 conspiracy theories. Hacking insurance and legal firms who handled cases following the terrorist attack like Lloyds of London, Hiscox Syndicates, and property owners Silverstein properties, The Dark Overload awaits payment.

Dublin’s Light Rail System, Luas, has been hacked by an unidentified group looking for a single bitcoin as payment. Although the website has continued to be out of service, Luas claims only personal information from customers signed up to the newsletter has been compromised.

9. BCH: centralization nearing critical levels; 900+ retailers now accepting it

Bad news and good news for BCH. The first concerns the now alarming levels of centralization that the coin has reached. According to figures provided by CoinDance, the Chinese exchange BTC.TOP controlled up to 50.2% of the entire network at some point during Thursday 3rd, with a hashrate of 679 Peta-Hash per second. Back in July it was revealed that 49% of Bitcoin Cash nodes run on Alibaba’s facilities. Experts are concerned that this centralization could severely hurt the project.

And now for the good news: According to a Reddit user, 945 online merchants are listed on AcceptBitcoin.Cash, most of them small indie outlets. Last month experts predicted that mass cryptocurrency adoption is between three and five years away.

10. Cryptocurrency-Friendly State Treasurer Accepts Bitcoin

Overstock, an online retail company, will pay 2019 business taxes with Bitcoin. Patrick Byrne, CEO of overstock and longtime crypto enthusiast believes it’s “the best way to ensure the U.S. does not lose our place at the forefront of the ever-advancing global economy.”

In 2014, Overstock began to accept Bitcoin from consumers. Byrne will be leaving Overstock soon to focus on Medici Ventures-Overstock’s blockchain subsidiary- in order to further promote the blockchain revolution.

11. Stock Shock Heard Around the World

Although S&P 500 set an all-time record in September, and the DOW back in October, 2018 has been seen as the worst year for global stock markets since 2008. Monetary policy, trade wars, and fear of inflation seem to have plagued the market, and recovery does not seem to be swift as 2019 is predicted to be another volatile year.

While global markets felt the effects of China’s slowdown and Brexit negotiations sent the value of the pound in a spiral, Ukraine’s stock market index rose 80.39%. Qatar’s growth of 20.87% in 2018 is expected to set a precedent for 2019 as their separation from OPEC was made official on Tuesday.

After a fairly slow week in the crypto world, we bid everybody a good rest over the weekend. See you next week!

Coin360 team.