Something is definitely brewing in Facebook’s newly formed department. Early in May, there was a rumor that Facebook was interested in opening a cryptocurrency department within its headquarters. The advertised positions are: Two Software Engineers
Bithumb, a major cryptocurrency trading platform located in South Korea, and now for its plans to operate a decentralized exchange in the upcoming months. This trailing on the news regarding Binance’s plan to launch a decentralized exchange by 2019.
Bitthumb DEX, is expected to target the global crypto marketplace and will be launched under an overseas subsidiary outside of South Korea. The DEX is currently being developed by the assistance of One Root Network (RNT), which already has experience deploying decentralized exchanges in early 2018.
The decision by BitThumb executives is a part of an ongoing strategy to compete with other leading exchanges within the global marketplace. Decentralized exchanges are receiving a lot of attention within the crypto ecosystem and will most likely continue to dominate headlines.
Both cryptocurrency exchanges generate massive profit margins from their trading fees. However, on decentralized exchanges, a third party provider cannot exist in order to collect these fees which limit the involvement of a central party with regard to processing crypto orders.
In order to incentivize developers as well as financial operations, it’s possible to code reoccurring transaction fees into Smart Contracts so each trade provides the development team of the DEX with an incentive to maintain development.
In an interview with Ran Neuner on CNBC’s Crypto Trader, Changpeng Zhao (CEO of Binance) stated that he firmly believes decentralized exchanges are the wave of the future for crypto trading.
“I believe that decentralized exchange is the future. I don’t know when that future will come yet. I think we’re at an early stage for that so I don’t know if it’s a year, two years, three years, or five years. I don’t know but we got to be ready for it,”
The SEC Commissioner, Hester Peirce stated that investing in the cryptocurrency marketplace requires a specific knowledge of the market which your typical investor lacks.
Due to this complexity only a particular type of investor can pursue this opportunity. However, entrepreneurs are developing new products which investors can access cryptocurrencies indirectly through hedge funds.
Investing through a decentralized exchange is much more complex than investing through a centralized cryptocurrency exchange due to the fact that users have no service providers to rely on when potential problems emerge. However for current Bithumb users, the launch of Bithumb’s DEX will provide an opportunity for the company to improve their track record with security breaches and hacking attacks.
Cryptocurrencies and the technology behind it can be realistically considered to be one of the most driven advances in the financial sector. Not only because of the nature of the assets but the entire working idea behind it, the transactions and the virtual lack of regulation surrounding digital currencies.
Fast forward to say a decade or two, money will be virtual globally. Meaning walking around with actual cash will be a rare occurrence. Digital currencies have skipped that hurdle and are completely encased in a system that is complicated for most people to understand.
Moreover, the blockchain system is a complete opposite of the traditional financial system around the world which are already regulated. It doesn’t mean that cryptocurrencies are a mystery. It is gaining more knowledge and assimilation worldwide. So with higher popularity, comes the need for regulation.
Crypto has seen its fair share of multiple scams and fraud incidences. Different countries have different stands on cryptocurrencies. Let us have a look at a few economies around the world and analyse the regulations they have put in place.
China was once the biggest cryptocurrency market worldwide and used to dominate Bitcoin trading. As of last year, their stand on cryptocurrency trading became harsh and they banned ICOs. The reason behind this move was the volatile Bitcoin prices. In 2017, Bitcoin soared to levels of $20,000, raising the interests of the US, South Korea and Japan. In 2018, they dropped to lows of $7,000.
China supports the underlying blockchain technology but states that the use of the technology has raised significant concerns especially because the trades are unregulated and have been used for fraudulent and questionable purposes before. In August 2018, five different Chinese government bodies; People’s Bank of China, Banking Regulatory Commission, State Administration for Market Regulation, Central Cyberspace Affairs Commission and Ministry of Public Security issued a warning regarding the use of cryptocurrencies and ICOs for risky illegal use.
The Chinese government wants to protect its financial stability and regards the unregulated use of cryptocurrencies and the unlimited trading of the same as a threat to its economy. Crypto mining is not banned however, and individual investors have not been badly affected by the current bans.
To begin with, even the term cryptocurrencies in the U.S is subject to different definitions in different jurisdictions. The Financial Crimes Enforcement Network only recently acknowledged crypto trading as some sort of currency which they term as ‘money transmitters’ and tokens as ‘other value that substitutes for currency’. The IRS has issued a tax guidance and legally recognizes cryptocurrencies as property.
The SEC (Securities and Exchanges Commission) considers cryptocurrencies as securities and earlier this year were looking forward to setting up comprehensive securities laws that would govern digital assets and the transaction of the same.
The Commodities Futures Trading Commission (CFTC) approach is that it allows cryptocurrencies to trade publicly and describes Bitcoin as a commodity. As of two days ago, American Cryptocurrency enthusiasts are awaiting the first ever Bitcoin Exchange Traded Fund (ETF) from the SEC. ETFs trade like stocks by tracking groups of assets or indices. If the ETF goes through, it may auger well for the future of bitcoin and other cryptocurrencies at large.
Cryptocurrencies in the U.K are not really legally defined as legal tenders but the trade of cryptocurrencies have specific registration requirements. Cryptocurrencies in the U.K are required to register with the Financial Conduct Authority (FCA) and has set up trading guidance that ensures that entities engaged in cryptocurrencies which fall under pre-existing financial regulations for futures and options and other derivatives require authorization.
The FCA is working closely with the Bank of England as recommended by UK’s Treasury Committee to establish well worked out framework around cryptocurrencies and ICOs so that consumers can be protected seeing that cryptocurrencies are under limited FCA jurisdiction.
Australia was among the first countries to institute cryptocurrency regulations. In fact, it was the second after Japan to declare cryptocurrencies and Bitcoin as legal tender in 2017.
In 2018, on the sole motivation of consumer protection, Australia’s Financial Intelligence Agency (AUTRAC), laid down actionable guidelines to be flowed by any ICOs under anti-money laundering and counter-terrorism laws.
The Asian country has had a confusing stand on cryptocurrencies altogether. In September of 2017, there were rumours of blanket ban on all ICOs, which were consequently dismissed in January 2018. The ban did not happen and it seems that South Korea has had a change of attitude towards crypto.
This came with harsh regulations;
Japan is the first country to regulate bitcoins and cryptocurrency trading overall. However, as time has gone by, their grip has become tighter and tougher. In recent months, investors have lost sums of up to 7 billion Yen.
A recent hacking scheme led to the loss of approximately $61 million stolen from Osaka based trader Zaif being operated by Tech Bureau Corp. this is not to mention what happened to Coincheck, the world’s leading crypto exchange in January.
Revision of the existing regulations require more frequent audits and taxation of the exchanges as crypto is treated as an income for the business.
Canada has not been very quick to jump on the cryptocurrency bandwagon but has undoubtedly become one of the more favourable countries to trade crypto. Their government has been working on a regulatory document but it will be revealed in early 2019. As such, crypto is not considered a legal tender but trading is very much allowed in the state.
There are high hopes that the regulations will be favourable as compared to the initial imposed rules that had been proposed in June 2018.
The Reserve Bank of India banned Indian banks from serving Bitcoins and cryptocurrency exchanges. India used to issue subliminal threats to investors and entities and businesses as well through official statements regularly, so maybe the ban was not a complete surprise.
The most telling threat came worded like this;
‘The government does not recognize cryptocurrencies as legal tender or coin. As such it will take all measures necessary to eliminate the use of these crypto assets in financing illegitimate activities.’
I may point out that the stand is completely unreasonable and unjustified. This leaves the question as to the future of cryptocurrencies in India.
Matter of fact, crypto regulations are only just beginning to unravel. On the one hand, it is a prerequisite since the idea is to make sure people have faith in the digital assets trading ground. This also means that it will take a long time to come up with highly effective legal framework to regulate crypto since the technology behind it is what runs the transactions altogether, eliminating the need for a legal intermediary.
Countries inherently look to preserve their financial stability and functional economies and may adapt crypto regulation at different speeds depending on their technological abilities. My take is that the scrutiny of crypto as a whole is a real playing factor before regulations can be set up.
The past week has seen the cryptocurrency bear market thrive on its position with prices plummeting to their lowest since October 2017. In August 2018, Bitcoin prices had started the downward freefall with prices threatening to hit below the $5,000 mark, and they eventually did in November. Cryptocoinjunky has posted articles on the reasons behind the Bitcoin crash which had been highly anticipated due to the splitting up of Bitcoin SV and Bitcoin ABC.
Back in August, cryptocurrency experts were markedly optimistic about Bitcoin prices recovery. Meltem Demoirs of CoinShare actually compared Bitcoin to internet stock prices. According to him, new technologies that capture the attention of many usually tend to face incredibly challenges severally before being fully utilized and prospering. He envisioned crypto technology as such an invention.
Since Bitcoin took off in 2009, cryptocurrencies have made significant strides in the digital currency world. But the question still lingers on the worth of digital assets investments in the future. Let us have a look at a few comments and market predictions from crypto experts on the current cryptocurrencies state.
Bitmex’s crypto expert Arthur Hayes believes that Bitcoin prices will hit $50,000 by the end of the year. This is despite the severe plummet of prices across the board that has been experienced in the last few months.
A sitting panel put together by investment company Finder analyzed the top performing coins by market cap. The predictions were set on an overview of 2018/2019 market price analysis.
In summary, the panel was optimistic that XRP, ETH, and EOS will increase in value by almost 200% by the end of 2019. Bitcoin will follow suit by an increase of 177% and Bitcoin cash by 77%.
Jeet Singh boldly compared crypto to Apple and Microsoft stating that it is completely normal that cryptocurrencies fluctuate by 70-80%. The volatile market may be unappealing to most investors but according to the investment portfolio manager, the more stable business models and crypto technology becomes, the more confidence it should inspire. Is he right? Is it a short term or long term prediction?
Kristjan Dekleva, a Swiss-based financial analyst and asset investment expert seems to see the future in crypto will be a long time coming; a decade, but will surely be worthwhile. He seems to echo the sentiments by Meltem Demoirs as far as cryptocurrency market stability is concerned. According to him, crypto downfalls have ‘been caused by emotions and misinformation where small rumors have a big impact.’
Kenneth Rogoff shades the sentiments of Kristjan and says that the price of Bitcoin will be worth $100 in ten years. Rogoff based his argument on the regulation of cryptocurrencies that he is sure will cause the market to plummet. In his expert opinion, governments and regulatory bodies hardly seem to grasp the technology behind digital assets and for this reason, the market will be hard hit as financial bodies come up and design regulatory frameworks regarding crypto transactions.
Gemini co-founder, Cameron Winklevoss is also optimistic, although on the drawn outside of things. He is sure that the price of Bitcoin could go up by 40%, in a decade or so. He also stated that the crypto market is highly underappreciated and it is one of the reasons why the market is so volatile.
Bobby Lee, co-founder of BTCC made a lauding comment on twitter regarding the value of Bitcoin compared to that of gold. On November 20th, 2018, he tweeted that Bitcoin is currently 1/8 the value of gold. He predicts that Bitcoin’s ‘rise to the top’ will not come easy but is definitely an outcome to look forward to. Only ‘true believers’ will survive to reap exceedingly great profits from Bitcoin after the bear season subsides.
John McAfee, the ever bullish supporter of Bitcoin came out hard on panic sellers today and asked them to relax or just get out of the market altogether. His tweet is unprintable (the cursing alone) but he has a point. According to him, the cycle of investment markets is always the same. Cyclical. It has ups and downs; at times the down being brutal and it does not help that investors are panicking. ‘Bear markets are like winter, it’s always followed by a glorious spring.’ He points the recent crash on fear, ignorance, misinformation, and uncertainty.
With the sentiments above and numerous others not posted, I think it is safe to say that yes, indeed the market is notoriously volatile, unpredictable, but not uncertain. Bitcoin prices will rise. For one, the crypto market is in constant expansion. For example, Saudi Arabia and the UAE are developing a cryptocurrency that will be launched mid-2019. Intercontinental Exchange, owner of the NY stock exchange has plans underway to open a Bitcoin futures product, the Bakkt Bitcoin Daily Futures Contract, which will be launched in early 2019.
Cryptocurrency regulation will aid the digital assets market to stabilize, even though short term, it will and is currently causing prices to drop (refer to recent developments in South Korea and China).
Francesco Fusetti CEO of AidCoin stated today that the drop in prices is actually beneficial to the market as it weeds out weak performers and strengthens knowledge of digital assets trading. Bitcoin has been the top performing coin in blockchain technology since its inception and has set a standard for virtual currencies.
This week, Bitcoin mining equipment manufacturer and blockchain software firm Bitfury secured a valuation of $1 billion from billionaire investor Mike Novogratz and Korelya Capital’s $80 million investment in the firm.
The multi-million dollar funding round comes after the release of Bitfury Clarke, the firm’s new Bitcoin ASIC miner, designed to compete against Bitmain’s new equipment, the 7nm Antminer.
Valery Vavilov, the CEO of Bitfury, stated that the demand for the blockchain and crypto in general from companies and institutions had increased significantly over the past 11 months.
“We see a lot of demand from companies and public institutions to put their services or products in the blockchain — especially in emerging markets, where administrative systems can be very inefficient.”
Throughout the past four months, despite the sideways market of Bitcoin (BTC) and the 70 percent correction experienced by the cryptocurrency market since January, the hash rate of the Bitcoin blockchain network has increased substantially from 15 million TH/s to over 50 million TH/s.
The increase in the hash rate of the Bitcoin network, which represents the strength of the blockchain’s computing power, led to a surge in the breakeven cost of crypto mining.
In July, cryptocurrency analyst Barclay James reported that the breakeven cost of mining Bitcoin is around $6,900, based on the hash rate of the Bitcoin network at the time which was 35 million TH/s.
According to Blockchain, the most popular cryptocurrency wallet platform in the sector, the hash rate of Bitcoin currently remains above 50 million TH/s, up 42 percent since July. Since the $6,900 breakeven cost of Bitcoin mining was calculated based on 35 million TH/s, the breakeven cost of mining has well surpassed $7,500 even in regions with naturally cold climates and cheap electricity like China that reduces operational costs.
“China has some of the world’s cheapest electricity rates as well as average temperatures consistent with temperate regions. This is important as cooling is one of the largest overheads in mining. In addition, the country’s generally low operating costs also give it a competitive advantage,” James wrote.
Due to the rise in the breakeven cost of mining, miners are generating BTC at a fairly large loss. Until BTC breaks out of the $7,000 resistance level and to the high region of $7,800 to $8,000, miners will continue to mine BTC with a loss of around 20 to 30 percent.
Mining companies and mining equipment manufacturers like TSMC and Samsung remain confident in the long-term development of the industry, and the investment of a major venture capital firm in Korelya is considered a confirmation of strength of the industry in a period of uncertainty and doubt.
Korelya is an investment firm financed by Naver, the largest search engine operator in South Korea that is more widely utilized than Google in the region. Bitfury is the first indirect investment in crypto from Naver.
Binance, the world’s largest crypto exchange, has voluntarily engaged in an initiative to eliminate money laundering on its platform.
For years, despite the inherent lack of privacy measures on major public blockchain networks like Bitcoin and Ethereum that discourage the settlement of illicit transactions, a widely pushed narrative against crypto has been the suspected usage of digital assets by criminals.
Eliminating Easily Refutable Claims
Bitcoin, Ethereum, Ripple, Bitcoin Cash, EOS, and many other major cryptocurrencies are not anonymous by nature. With Know Your Customer (KYC) and Anti-Money Laundering (AML) systems integrated by cryptocurrency exchanges, it is extremely difficult for criminals to utilize digital assets to settle the transfer of illegal proceeds.
Authorities and government agencies across the globe are well aware of the non-anonymous characteristic of blockchains, which could have motivated governments like the US, Japan, and South Korea to legitimate and recognize the cryptocurrency market.
This week, Binance has started to cooperate with Chainalysis, a leading blockchain analysis company that evaluates suspicious transactions and addresses, to improve its AML system and to further legitimize the cryptocurrency sector.
“Cryptocurrency businesses of all sizes face the same core challenge: earning the trust of regulators, financial institutions and users. We expect many to follow Binance’s lead to build world-class AML compliance programs to satisfy regulators globally and build trust with major financial institutions,” said Jonathan Levin, co-founder and COO of Chainalysis.
In 2018, some of the world’s most influential banks were cracked down for money laundering. Danske Bank laundered $243 billion from criminal groups, and as CCJ reported on October 20, Nordea Bank, the largest financial group in the Nordic countries, is said to have taken several illicit payments from banks in the Baltic region.
With the institutional market of cryptocurrencies growing exponentially, the tightening of AML systems employed by public exchanges is expected to solidify cryptocurrencies as a recognized asset class and the digital asset market as a well-regulated sector.
Wei Zhao, the CFO at Binance, said that maintaining the firm’s vision of increasing the freedom of money globally, the exchange will continue to adhere to regulatory mandates in the countries it operates in.
“By working with Chainalysis, we are able to continue building a foundational compliance program that enables the next phase of our growth. Our vision is to provide the infrastructure for a blockchain ecosystem and increase the freedom of money globally, while adhering to regulatory mandates in the countries we serve.”
Importance of Compliance
The cryptocurrency sector is entering a new phase of development and growth, as Zhou explained.
During the 2017 bull market in which the valuation of the cryptocurrency market surged to $800 billion, the asset class obtained significant mainstream awareness in both countries that support crypto and regions that have established impractical regulatory frameworks to prevent local blockchain markets to flourish.
In a period in which governments are introducing increasing efforts to embrace crypto and blockchain businesses as a part of the fourth industrial revolution, voluntary initiatives by companies like Binance to legitimize the industry will ease the process of governments in regulating and acknowledging the global market.
Bolstered by stable trading volume, growing network activity, and increasing validation on Wall Street, the bitcoin price could be on the brink of a major move to the upside.
eToro senior market analyst Mati Greenspan said that the stars continue to align for a potential bitcoin rally, making it increasingly likely that the most prominent cryptocurrency will soon break out of its holding pattern.
|“It’s only a matter of time now,” he said of a potential bitcoin breakout. “Of course, the flatline pattern could easily remain for another few months and that wouldn’t be a bad thing, however, there are signs of excitement boiling underneath the cool price action exterior.”|
Greenspan, who previously said that he thought bitcoin was heading into a “classic breakout pattern,” identified three catalysts that he said were suggestive of an imminent breakout, namely, a rising transaction rate, steady daily trading volumes, and the continuing growth of cryptocurrency-related activities on Wall Street.
Citing data from Blockchain, Greenspan notes that the number of bitcoin transactions per second — which plunged during the first quarter — has steadily risen throughout the second half of 2018. Since dropping below 2.0 TPS in mid-April, the transaction rate has climbed to 2.78 as of Thursday morning — a six-month increase of more than 40 percent. While still far below the 4.8 TPS achieved in late December, this present growth has occurred during relatively stable market conditions — not a parabolic rally. This, Greenspan said, is “a classic indication that we’re nearing the end of the flat cycle.”
Concurrently, daily cryptocurrency trading volumes, which steadily declined throughout most of the year, appear to have flatlined near $10 billion over the past several months, which Greenspan notes is “exponentially higher” than the average daily volumes seen during the last bear market.
But while volumes on cryptocurrency spot exchanges have flatlined, trading activity within the Wall Street futures markets are booming. CME Group — operator of the largest U.S. bitcoin futures market — identified a 41 percent quarter-over-quarter increase in the average daily volume during Q3. On a daily basis, CME is handling approximately as much volume as Upbit, one of the largest spot cryptocurrency exchanges in South Korea.
Taken together, Greenspan argues that these data points bode well for the short and mid-term future of the cryptocurrency market.
The International Monetary Fund (IMF) has stated in a recently released report that the rapid growth of Bitcoin and crypto could impact the international finance system.
The report entitled “World Economic Outlook: Challenges to Steady Growth” published by the IMF read:
|“Cybersecurity breaches and cyberattacks on critical financial infrastructure represent an additional source of risk because they could undermine cross-border payment systems and disrupt the flow of goods and services. Continued rapid growth of crypto assets could create new vulnerabilities in the international financial system.”|
Despite the 80 percent decline in the valuation of the crypto market, the industry has seen some of the most positive developments regarding the institutionalization, regulation, and development of cryptocurrencies as an emerging asset class in the past nine months.
Led by existing companies like Coinbase and Gemini, major financial institutions in the likes of NYSE, Cboe, and Goldman Sachs have started to strengthen the infrastructure of the cryptocurrency market, allowing both high profile retail traders and institutional investors to allocate large amounts of money in the asset class.
As the cryptocurrency sector continues to grow at an exponential rate, the IMF emphasized that it could create vulnerabilities in the financial system. Because cryptocurrencies are considered alternative currencies with value, a growing number of hackers have started to target digital asset trading platforms with sophisticated tools and hacking methods.
“Stealing cryptocurrencies is similar to stealing cash, and exchanges will continue to be targeted by hacking attacks in the long-term. It is as important to establish systems to deal with the aftermath of hacking attacks as integrating various methods to prevent hacking attacks,” Jeon Ha-jin, the chairman of South Korea Blockchain Association said.
In South Korea, the third largest cryptocurrency exchange market behind the US and Japan, exchanges have begun to insure their funds through trusted insurance providers like Samsung to add an additional layer of security and investor protection.
Gemini, a leading cryptocurrency exchange in the US alongside Coinbase, also recently obtained insurance services from Aon to ensure that in an unlikely event of a security breach, the exchange is able to cover user funds and holdings fully.
“Consumers are looking for the same levels of insured protection they’re used to being afforded by traditional financial institutions. Educating our insurers not only allows us to provide such protections to our customers, but it also sets the expectation for consumer protection across the crypto industry,” Yusuf Hussain, Gemini’s Head of Risk, said.
The cryptocurrency industry and infrastructure employed by exchanges are relatively new and fundamentally different from the technologies implemented by the traditional finance sector. As such, it is appropriate for the IMF and government agencies to describe the rapid growth of the asset class a risk to global finance.
But, continuous efforts to strengthen the infrastructure of the cryptocurrency market and improve investor protection will reduce the risk cryptocurrencies have on the global finance industry.
Emin Gun Sirer, a professor at the prestigious Cornell University and a highly regarded expert in the space of cryptocurrency and blockchain, stated that the acknowledgement of cryptocurrencies as an asset class by the IMF is optimistic for the industry.
On Oct. 6, Larry Cermak, former editor at Diar and head analyst at The Block, reported that leading crypto exchange Bitfinex obtained a banking partner in HSBC, a $133 billion banking giant based in London.
“Bitfinex is now banking with HSBC through a private account of Global Trading Solutions. Very good fit if you ask me. It’s also worth mentioning that all EUR, JPY and GBP deposits are paused but Bitfinex ‘expects the situation to normalize within a week’” Cermak said.
As one of the oldest cryptocurrency exchanges, Bitfinex has experienced some of the most difficult challenges an exchange could face, particularly before major cryptocurrency markets like Japan, South Korea, and the US offered clarity on cryptocurrency regulation.
The exchange’s conflict with Taiwanese banks is well-documented, and in April 2017, Bitfinex initiated a lawsuit against Wells Fargo, a US-based banking giant, for blocking deposits to the banking account of Bitfinex and disrupting operations of the business.
“The decision to initiate legal action is because we cannot allow precedents in this industry where clearing houses can disrupt businesses that are by all metrics complying with the rules in place. If we allow them to simply flip a switch and disrupt business, then there becomes a precedent in the bitcoin industry beyond just Bitfinex, so we believe it is the appropriate time to take action,” Bitfinex said at the time.
Since then, Bitfinex has moved out of Taiwan and relocated to the Caribbean and in May, Bloomberg reported that the exchange partnered with Noble Bank to process transactions sent by its clients.
However, Noble Bank has announced to file for bankruptcy following an in-principle deal to restructure debt in January and with that, the only banking partner of Bitfinex vanished.
HSBC is really the first proper banking partner Bitfinex has obtained since Wells Fargo in 2017. If the deal between Bitfinex and HSBC can be sustained throughout the long-term, it will bring a level of stability to the operations of Bitfinex which the exchange failed to secure in the past four years.
Speaking to The Block, Kasper Rasmussen, director of communications at Bitfinex said that the firm cannot comment on the nature of the partnership between the exchange and HSBC.
“Bitfinex does not, and has never, commented on actual or potential business relationships and this is not subject to change now,” Rasmussen stated.
Given the the $200 million dollar daily trading volume of Bitfinex and the amount of fiat deposits the exchange receives from its international customers, it is not possible for the exchange to unilaterally announce its dependence on HSBC as a banking partner through a private banking account.
It is highly probable that the exchange, with strict Know Your Customer (KYC) and Anti-Money Laundering (AML) requirements, obtained the banking service of HSBC through a strictly regulated channel.
Already, most exchanges in major markets like Japan and South Korea have obtained banking services by large financial institutions and commercial banks in their respective countries. If Bitfinex can sustain its partnership with HSBC, it will have a positive impact on the stability of the crypto market.
Binance, the world’s largest crypto exchange by daily trading volume, is set to launch a beta version of its decentralized exchange (DEX) by early 2019.
Changpeng Zhao, the CEO of Binance better known to the community as CZ, said on Saturday:
|“Just had a productive meeting for Binance DEX (decentralized exchange), where BNB will be native gas, and the exchange don’t control user funds. Aiming for a public beta end of the year/early next year. Yes, we work on Saturdays, non stop.”|
In July, on CNBC Crypto Trader hosted by Ran Neuner, CZ stated that he personally believes decentralized exchange is the future of crypto.
In the long-term, CZ explained that users will be able to utilize non-custodial wallets to trade cryptocurrencies in a peer-to-peer manner with full control over their funds.
“I believe that decentralized exchange is the future. I don’t know when that future will come yet. I think we’re at an early stage for that so I don’t know if it’s a year, two years, three years, or five years. I don’t know but we got to be ready for it,” he said.
As a centralized cryptocurrency exchange, most of its revenues and profits are generated by the fees charged by the exchange. But, decentralized exchanges can also charge a native fee embedded into the smart contracts utilized by the platform to broadcast transactions to the mainnet of public blockchain networks like Ethereum.
In October of last year, Ethereum co-creator Vitalik Buterin praised a model utilized by EtherDelta, a decentralized exchange, to incentivize developers for maintaining the platform.
“I think the EtherDelta model for developers getting paid is underrated,” he said.
At the time, a South Korea-based cryptocurrency user recommended Binance to Buterin on Twitter, mentioning its low 0.05% fee. Buterin responded that to use centralized exchanges, a process of setting up accounts is required. On decentralized exchanges, users can utilize existing wallets like MetaMask to trade.
“That requires setting up an account. I like EtherDelta precisely because it doesn’t. Just visit the site with MetaMask on and start using it. Not slow at all. I don’t give a damn about split-second trading. To me, speed includes login, deposit, withdrawal, logout time,” Buterin explained.
According to CZ, Binance is probably a more secure alternative to decentralized exchanges because of its strong architecture and infrastructure. Binance has never been hacked since its launch in 2017.
CZ emphasized that the real merit of using decentralized exchanges is in the freedom and control over user funds. On a decentralized exchange, users do not have to create user accounts or file withdrawal requests. Every trading activity is done on the blockchain with a non-custodial wallet.
Eventually, as the adoption of cryptocurrencies increases and fiat becomes less relevant in the cryptocurrency exchange market, traders will likely shift from centralized platforms to decentralized exchanges.
The Binance team remains uncertain when the change will happen but as CZ said, the company is getting ready for it.
Syndicated from CCN
There are a few ways to earn Bitcoin without depositing one single Satoshi of your own. From using faucet sites, taking polls, or getting paid for freelance work in Bitcoin, venues that pay in BTCare readily available for those willing to earn it through hard work or sacrificing time.
Only problem is, most of these will earn you an extremely small amount of Satoshi for the time you put in and are downright boring. If you’re like me, what you really wanna find is an easy way to earn a decent amount of Bitcoin while having fun doing it, right?
For example, would you believe that there are video games that you can play on your desktop or smartphone app that allow you to earn Bitcoin (or another digital token which can be exchanged for Bitcoin) while getting lost in playing a game you’ll actually enjoy.
Every single game listed on this article is free to play. That’s right, no deposit required. I was also careful to list games that are actually fun to play and require some element of skill as opposed to straight up luck.
SparkProfit – if you consider yourself a financial genius or the next up and coming Wolf of Wall Street, but live off a steady diet of Top Ramen within the humble confines of your grandmother’s basement, this might be the right game for you.
This financial trading simulation has you making predictions on real financial marketplaces, including cryptocurrency markets as well as Forex. The more accurate your predictions are the more points you unlock because of it. You can then cash out your points to Bitcoin at any time.
Another great aspect to the platform is the fact that they provide you with the plethora tutorials and resources in order to help you become a “real” successful trader.
You can earn up to a few hundred dollars worth of Bitcoin per month if you work hard at.
Check out their introduction video here:
Altcoin Fanstasy – this is one of the newer virtual crypto trading games you can play that promises to teach you how to trade crypto within a risk-free environment. Test your trading skills on a competitive leaderboard environment without sacrificing any of your own hard earned money.
Altcoin Fantasy opens their doors to the public in January 2018. You can trade on their website or mobile app which is compatible with both Android and iOS devices. They’re currently available to US and Canadian residents and are looking to expand to Japan, South Korea, and Hong Kong very soon.
The game is very well laid out and has a professional interface that you’d expect to see from a fantasy sports website. The company includes both weekly and monthly contests where you can win real Bitcoin thanks to their partnerships.
Choose from a selection of trading contests hosted by various sponsors. View prizes from each contest and sign up to each one of them for free. You begin a contest with 10,000 virtual US dollars. Your goal is to accumulate as much cryptocurrency (thus increasing your USD value) by the end of the contest period. If you can do just that, you’ll end up winning the contest and awarded your prize money in Bitcoin.
How Much Can You Win?
This depends on the contest you enter. Some contests only award the top winner the prize while others split the prize money among the top 50 or 100 traders.
You can also win other cryptocurrencies besides Bitcoin like Stellar Lumens, Ethereum, and many others. You’ll also find that other virtual trading contests award prizes in USD, which is a great alternative for most.
Altcoin Fantasy gives away hundreds of dollars in prizes every single week, free of charge. This is one of the best virtual cryptocurrency trading sites to date.
Check out this Altcoin Fantasy Video Walkthrough:
Tremor Games – this online flash gaming site offers a wide range of games, much like any other typical flash arcade. However, unlike your typical run-of-the-mill flash gaming site, you can earn “Tremor Coins” while playing and gaining achievements. Once you’ve built up enough tremor points, you can then exchange them for a wide range of prizes, which include Bitcoin withdrawals.
Bitfun.co – this is a bit of a spin on your typical Bitcoin faucet site. However, this flash gaming site allows you to play a variety of flash games while paying you every three minutes for your time from a Bitcoin faucet.
Satoshi Quiz – this game is a surprisingly fun game with a variety of very interesting questions along with a a prize pot of 1000 Satoshis for every question answered. There’s a good mix between easy and hard questions, and they even allow you 1 minute for each question so if you’re quick behind the keyboard, you may be able to Google the answer before the time limit runs out. There are also standard challenges where prizes of up to 1 million Satoshis are awarded.
Quiz BTC – a “competition style” quiz site allows you to earn free Bitcoin by being the first one to answer a question correctly. The person to answer the question the fastest earns more Bitcoin satoshis. Questions are posted every minute and satoshis are awarded regardless if you answer the question faster than your competitor.
Takara (iOS only) – this PokémonGo style geo-location game allows you to collect coins from specific locations in your area. The game will also be available to Android users soon.
Oh Crop – this highly addictive android game allows players to dodge in we’ve through multiple projectiles in order to avoid evil plants that are trying to kill you. You collect game tokens and power ups which help you survive and kill the enemy plants. The primary goal of the game is to survive as long as possible with the highest amount of points.
This simple and intuitive game relies on the in-games accelorometer (virtual joystick) for movement of your in-game character. This is not only a great smartphone game, but the fact that you can earn Bitcoins as a reward while playing makes it even that much more addictive.
In order to claim your Bitcoins, you need to make it to the top 15 strongest players on the leaderboard. Don’t worry if you don’t make it at first, as the game has cycles that last several days, where the leaderboard is reset after each cycle.
c- this smartphone game allows you to become a Bitcoin mining tycoon by allowing you to purchase virtual mining rigs in order to mine Bitcoins for profit. The game starts you out with a few simple machines so that you can earn enough Bitcoin to purchase your own in-game mining farm. From there you can continuously improve your farm in order to generate a nice ROI.
Storm Play – this fun and easy way to earn free Bitcoin allows users to earn STORM, Bitcoin, and Ethereum tokens by trying out new games products and services. Deposit your new earnings to your Coinbase, Exodus, or any other personal wallet you own.
BitQuest – if you’re a MineCraft fan you’re going to absolutely go crazy over this game. If not, I guarantee you’ll still get addicted. This popular “sandbox game” allows players to build game worlds in which you define a story and have full control over all aspects of your creation.
The MineCraft style game includes Bitcoin as its main in-game currency which you earn by mining, trading, and interacting with other players.
Spells of Genesis – the longest running Bitcoin RPG to date, Spells of Genesis is everything you ever wanted in a Bitcoin RPG game and more. You can play this amazing RPG on both desktop and mobile devices. This RPG mixes the trading card game genre, with a strategy based game, as well as implementing arcade style gaming elements.
You’ll need to collect, trade, and combine orbs in order to build the strongest gameplay deck you can in order to test them against other opponents while exploring the vast world of Askian.
Unlike other free Bitcoin RPG games, players are able to actually own their in-game items and cards outside of the game itself on blockchain. Now keep in mind that you can exactly earn Bitcoin directly within the game, however you do build up a collection of rare cards, which when fully upgraded, can be stored on the Bitcoin blockchain utilizing Counterparty protocol.
This in turn allows you to trade with other players on the decentralized exchange. If you’re lucky enough to snag a rare or powerful card, you’ll have no problem finding another player willing to purchase it on the exchange.
Check out their Twitter page here. Their community is constantly expanding as fast as the in-game development itself.
CoinBrawl – this unique RPG Bitcoin game allows you to fight other players, level up your hero while earning Satoshis through their in-game faucet. The site claims that you can upgrade your character and earn more than 100,000 Satoshis per day.
Click here the check out their top 100 Coinbrawl players and the amount of Satoshis that have been earned from each.
As always, if you have any other games that you’ve stumbled across that could be added to the list, please leave your comment below. I’d be more than happy to add them.
| Looking for something a bit more?
Check out our review for Gods Unchained – the first competitive e-sports RPG/Hearthstone style game on the Ethereum network back by Coinbase.
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