Last week had a crimson tone for crypto, as all of the top five cryptocurrencies showed significant losses. What’s more, of the top five currencies, Bitcoin had the harshest week, shedding more value than its peers (9.9%), and dipping below the $10,000 mark. Other important developments include Justin Sun postponing his lunch with Warren Buffett and the subsequent accusations of illegal fundraising, money laundering, and enabling porn transactions; activity from regulatory entities like Germany’s BaFin and the U.S’s IRS; different surveys in the U.S, the U.K and Germany regarding the perception of Libra; and an increased interest in Bitcoin investment.
Here’s what you need to know about last week’s happenings in crypto.
Bitcoin (BTC) opened at $10,596.95 on Monday hit its highest price for the week later that day, at $10,651.79. By Sunday, the price of BTC had dropped 13.1%, reaching its low of the week at $9,252.30. By the end of the day, the price of Bitcoin had recovered slightly, closing on Sunday at $9,552.86, with a 9.9% loss for the week. Bitcoin’s market capitalization suffered a 7.6% loss last week, closing at $170.5B on Sunday.
Bitcoin 7-day price and market cap chart. Source: COIN360
Ethereum (ETH) started the week at $225.70 and reached its high for the week on the same day, at $226.86. Its lowest price of the week took place on Sunday at $202.25, 10.9% lower than the high on Monday. By the end of the day, ETH was at $211.19, closing on Sunday with a 6.4% loss for the week. The market capitalization for Ethereum shed 2.9% of its value throughout the week, closing on Sunday at $22.6B.
Ethereum 7-day price and market cap chart. Source: COIN360
Ripple (XRP) opened on Monday at $0.331368, and then proceeded to increase just slightly, by 0.1%, to reach its high of the week at $0.331670. By Sunday XRP had depreciated 8.3% until it hit its low of the week at $0.304110. XRP closed on Sunday at $0.312288, with a 5.8% loss for the week. The market capitalization for Ripple closed the week at $13.4B, losing 3.1% of its value since last Monday.
Ripple 7-day price and market cap chart. Source: COIN360
Litecoin (LTC) started the week at $99.56 and later on Monday surpassed the $100 market for the only time of the week, peaking at $100.25. Like the cryptocurrencies above, Litecoin also had its lowest price of the week on Sunday at $85.35. Later that day LTC closed at $89.77, with a 9.8% loss for the week. Litecoin’s market capitalization lost 5.8% of its value throughout the week, closing at $5.6B on Sunday.
Litecoin 7-day price and market cap chart. Source: COIN360
Bitcoin Cash (BCH) opened at $321.00 on Monday and peaked for the week that day at $323.62. BCH’s low of the week took place two days later, on Wednesday, at $284.73. On Sunday BCH closed at $310.46, for a 3.3% loss for the week. The market capitalization for Bitcoin Cash barely changed, shrinking 0.02% throughout the week to close at $5.6B on Sunday.
Bitcoin Cash 7-day price and market cap chart. Source: COIN360
At the beginning of the week, the TRON foundation tweeted that Sun’s lunch with Warren Buffet was postponed due to kidney stones. However, local media outlets later reported that the real reason why Sun canceled the event was because of an exit ban that prohibited Sun from leaving China. The reports also cite other accusations, including illegal fundraising, facilitation of porn-related transactions, gambling and money laundering. The following day, Sun did a short livestream on Twitter showing that he was in San Francisco, and not China. In a now deleted post on Weibo on the same day, Sun denied all of the accusations, saying that the TRON foundation returned the funds of their ICO after they were banned in China. Two days later, Sun would post on Weibo once more, this time apologizing to the crypto community, stating that he felt “ashamed for (his) over-marketing”.
Following the accusations, the price of TRX has taken a tumble, shedding 23.4% of its price during the week.
According to a Jul. 26 news release, the IRS has begun sending letters to taxpayers involved with crypto that didn’t report their transactions properly or that have failed to report income and pay the corresponding taxes. According to commissioner Chuck Rettig, this is part of the IRS’s expansion into cryptocurrency, and these letters, which will total about 10,000 by the end of August, should be taken very seriously. However, a Forbes report indicates that the letters share similarities with generic mailing campaigns and have probably been sent out to most Coinbase customers, not actual tax cheats. Additionally, the Forbes contributor also reports that multiple taxpayers who have reported their cryptocurrency activity correctly have still received the letter, meaning that it is unlikely that the letters are personally targeted actions.
A recent study conducted by Grayscale Investments shows that 83% of American investors would consider investing in Bitcoin. According to the study, “average” or traditional investor demographics, attitudes, political views, income levels and beliefs overlap greatly with Bitcoin investors. The report also states that Bitcoin has expanded its reach to a “broad mainstream audience”, with 42 being the average age for Bitcoin investors. At the same time, 68% of investors interested in BTC revealed that digital crime was the number one fear when it came to investing. Additionally, over 50% of them expressed concerns about digital asset regulations and 89% of the people surveyed expressed they would likely invest in Bitcoin if there were better educational resources on the matter.
Jon Barry Thompson, principal of cryptocurrency escrow company Volantis, was arrested on Jul. 25 following allegations of fraud by federal authorities in the state of New York. The Department of Justice, the US Attorney for the Southern District of New York, and the NY Field Office of the FBI unsealed a filing from complainants stating that Thompson had committed two counts of commodities fraud and two counts of wire fraud. Allegedly, Thompson “preyed” on the victims’ ignorance and fraudulently secured over $7M from 2 different companies, after claiming that Volantis minimized risks in Bitcoin transactions by acting as a custodian of the companies’ assets. Thompson is facing a maximum sentence of 60 years in prison for all 4 charges combined.
A Jul. 24 post on the Brave browser community site announced that users of Brave Nightly (described as an early untested version with incomplete features) will be able to withdraw BAT tokens, though the creation and verification of an account with financial services platform Uphold is required first. Once verified, users will also be able to buy BAT tokens. However, this update means that all creators who wish to be tipped in BAT will also have to be verified with Uphold. However, the earning of BAT through watching Brave Ads and tipping will remain the same and will not require verification.
Bakkt has begun testing the delivery of BTC futures. On Jul. 22, the company tweeted that the user acceptance testing for the Bakkt Bitcoin Daily and Monthly Futures contracts had launched with participants from around the world. The launch, which had been postponed several times due to different regulatory procedures from the U.S Commodity Futures Trading Commission (CFTC), was announced in June by Adam White, COO of Bakkt, who also stated that Bitcoin futures can potentially bring more institutional participation in crypto markets.
The latest filings in NYAG’s legal battle against iFinex state that the claims made by the OAG are inaccurate and/or contain misleading assertions concerning the activity of Bitfinex and its relationship (or rather, lack thereof) with customers based in New York. The filing states that all eligible contract participants (ECPs) that deal with Bitfinex or Tether must be foreign entities, but that this doesn’t mean that these entities can’t have personnel who reside in New York. According to the documents, the OAG presented a “grab bag” of New York contacts, which contain inaccurate information or have nothing to do with the case. Another filing which also supports the dismissal of the case reads: “After broad jurisdictional discovery, OAG has not shown that any aspect of the Crypto Capital relationship or the loan transaction touched on New York in any way. OAG has failed to identify a single New York customer who was misled or even considered representations about tether’s backing, nor any New Yorker harmed.”
Huobi Thailand, according to an official announcement, will be the fifth entity to receive a license to operate a digital asset exchange in Thailand. It will be powered by Huobi Cloud, which means that its matching systems, wallets, asset management and clearing system will be of “equal standards” to Huobi Global. Huobi Thailand is slated for a Q3 2019 release.
On Jul. 24, Ripple published its Q2 report, in which it was revealed that the company sold $251.51M in XRP, a 48% increase from the $169M in XRP sold during Q1 of 2019. According to the report, Ripple restricted XRP sales, temporarily pausing programmatic sales and putting limits on institutional sales, because of supposedly inflated trading volumes. The report also states that Ripple withdrew a total of 3B XRP from escrow during Q2 and that 70% of it was reinvested into escrow contracts, while the remaining 900M XRP is being used to fund different initiatives and the development of use cases for XRP.
A letter from Debo Jurgen Etienne Guido, written in July and filed on the 22nd, states that he is “the genuine and only originator/creator of the genesis block of the Bitcoin blockchain.” The letter, addressed to the judge of the ongoing Kleiman vs. Wright case, claims that he had no contact with Dave Kleiman, and that Craig Wright has “no clue how the genesis block is composed.” According to Debo, who is also behind the @realSatoshiN Twitter account, he generated the 0x18C09E865EC948A1 pgp key, which is purportedly signed by all who were close to Satoshi around the time Bitcoin was created.
Amid confusion related to its timing, it was confirmed that Bitcoin SV successfully performed a hard fork and increased its block size limit from 128 MB to 2 GB. The fork was confirmed when, 16 blocks after 14:00 UTC (the time that appeared on its code), Bitcoin SV had a 145.7 MB block. Over the last 12 months leading up to the hard fork, the average block size was only 400 KB, and Bitcoin SV blocks had a median size of 120 KB.
A recent survey conducted by CivicScience showed that out of 1,799 American adults, only 2% trusts Libra more than Bitcoin. The results, released on Jul. 22, showed that 75% of people don’t trust Libra over Bitcoin (or any other cryptocurrency). This is related to Americans’ general lack of trust in Facebook and how it handles personal data. According to the research, only 5% of Americans claimed to be interested in Libra, while 86% of them are not interested in the cryptocurrency at all. In another survey, conducted by messaging app Viber, 49% of users in the U.K. and the U.S. stated they do not trust Facebook regarding Libra or keeping their private information secure when using the coin. Only 4% of those surveyed in the U.K stated they would trust Facebook, and only 2.5% in the U.S.
A similar survey conducted by German financial association Bürgerbewegung Finanzwende published last Tuesday showed that around 78% of the 2,093 German adults polled agreed that the company has a negative influence, and 68% of the surveyed were skeptical about Libra, while only 14% of them welcome the development of the cryptocurrency. In addition to publishing the results, Bürgerbewegung Finanzwende also called on the European Commission and the European Central Bank to put a halt to Libra’s development.
On Jul. 23, Ethereum wallet MetaMask launched the public beta version for its mobile app, MetaMask Mobile, with new features for Android and iOS. The new dapp allows users to sync it with MetaMask’s desktop extension—wallet accounts, tokens and transaction history included—in seconds, as well as providing ERC-721 support. Users can perform instant payments without transaction fees and send assets in fiat or crypto, among other features.
Starting on Jan. 1 of 2020, new AML regulations will be enforced in Germany. As of next year, crypto assets will be considered a financial instrument in the country and all cryptocurrency businesses, like exchanges and wallet providers, will need to hold a license issued by the Federal Financial Supervisory Authority (BaFin) to operate. While some think this measure can hurt the crypto business in the country, Christian Schmies, partner of the law firm Hengeler Mueller, suggested that this new regulation will potentially bring institutional investors closer to the cryptocurrency markets, as the technology has not been accepted yet due to a lack of a “reliable legal framework”.
The world of crypto had a bad week, but Justin Sun is probably the one who suffered the most. While it is still not clear whether the allegations of money laundering and crimes hold any water, the man who spearheads TRON has seemingly learned a valuable lesson about over-marketing. Despite this possibly bringing more negativity towards the perception of crypto at a time when exactly the opposite is needed, his words about being more cautious while marketing products could reach younger developers and bring about more maturity in the space. For many aspiring developers, aggressive marketing tactics seem to be the only course of action, but we are now seeing the consequences of such marketing strategies. Bitcoin, as an asset that represents cryptocurrencies, is maturing, and this is one of its growing pains.
We wish you a great week,
The COIN360 Editorial Team