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Feature: Where do we go now?
The crypto crash is reverberating through the Internet while the "rest" of the economy - namely the stock market - enters free fall. Commentary on the very human and thus flawed stock market is still well within the realm of pundits and guys who press funny buttons on TV, whither crypto?
First, the die hards are chiming in noting that they are retaining their investments - HODLing, as it were. Still others are buying. My favorite crypto-pundit, Jameson Lopp, chimed in today:
And the mysterious "Bitcoin content creator" Vortex brings up a very important point:
First, I don't think this is the bottom of the fall. Expect things to hover around $5,000-$10,000 or even a bit less as the folks begin thinking long and hard about why they're in the space. I suspect we'll see a rise in interest as Wall Street bonuses are paid out this month and savvier investors "buy the dip."
But what cause this and why am I still bullish on the market? First, we have news that China has banned foreign crypto exchanges. Writes CoinTelegraph:
China will add offshore cryptocurrency exchanges and ICO websites to its Great Firewall, the South China Morning Post reported Monday, reported Feb. 5, quoting a publication affiliated with the People’s Bank of China (PBoC).
This sort of news - seemingly definitive and seemingly catastrophic - is actually a dud. In China the Great Firewall is not nearly as effective as the government would have you believe. While it does lock out the inexperienced or non-technical investor, I doubt many of the miners or crypto exchanges are worried. VPNs - essentially ways to circumvent the Great Firewall - are easily available. In short, this has no teeth and the panic selling associated with this will eventually stop as investors figure things out.
We must understand the FUD cycle for cryptocurrency is very strong. While Microsoft and other entrenched enterprise players had a lot of skin in the game when it came to talking down and trying to bury Open Source and, more specifically, Linux, the Internet of Value is dealing with real money and real economies. The drive to take control of all sides of the equation is great and ultimately it will be subsumed, just as many open source platforms have been subsumed, into the fabric of the Internet.
Betting on crypto is a bet on a new way of doing this. I discussed analogs to this current market to a fascinating investor who has watched the rise and rise of the Internet and she equated the current crypto market to the Internet in 1993 - it was there, it wasn't popular, and it would take a few short years to enter our lives and change it permanently. We also must remember that computer networking has been around since the late 1960s yet it did not permeate our lives until about the turn of the century. In 1993 we were reading email on Elm and editing our away messages with Vim. Now we think nothing of dashing off a Word document to someone a thousand miles away and expecting it to arrive safe and unharmed. The same is not yet true of, say, a payment to a contractor because middle men and heritage technologies are ensuring we must all sit on our hands while tools like SWIFT and ACH muddle along.
We all know that something big is happening. Whether it's tied to BTC price or not is uncertain, but we do know that these technologies have a part to play in our brave new future.
Two tokens to watch 👁️
Metal is one we’ve talked about before but it is definitely one of the few companies with a solid CEO, solid product, and actual code. It is also one of the few tokens you can trade right now. It is available for conversion on Binance (although I wouldn’t keep my cash on Binance right now, especially given the China news.) The company has its own wallet, called the MetalVault, and the fundamentals on this token are strong.
Spherepay just launched its SAY token in Singapore. The mission is to let users buy actual things - clothes, groceries, etc. - with the SAY, creating a decentralized cryptocurrency that is actually spendable in the world. The mission is similar to Metal’s and I would argue that anything in the payments space is a no-brainer when it comes to the need for a real, usable token. You can read the white paper here.
The Good, the Bad, and the Ugly 😊😠👹
😊GOOD: Singapore Airlines is creating a blockchain-based loyalty wallet, a move that points to increased adoption of enterprise blockchain tech. This is another perfect problem for crypto to tackle and I expect we’ll see more moves like this in the next few months.
😠BAD: The true value of the equities market is being tested by Wall Street as the down falls 1,000 points. These types of corrections are common and, all told, the market has lost more than the Bitcoin market cap. Everybody hurts.
👹UGLY: The Equifax probe is “on ice” after the company leaked millions of personal records from 143 million Americans. The Consumer Financial Protection Bureau will no longer investigate Equifax for the breach. From Reuters: “Three sources say, though, Mulvaney, the new CFPB chief, has not ordered subpoenas against Equifax or sought sworn testimony from executives, routine steps when launching a full-scale probe. Meanwhile the CFPB has shelved plans for on-the-ground tests of how Equifax protects data, an idea backed by Cordray. “
Hackers are working hard to phish cryptocurrencies according to security firm Kaspersky. The phishing attempts often appear as password resets for popular exchanges including Coinbase and Kraken and encourage users to type in their passwords. Kaspersky writes:
The simplest version of cryptocurrency phishing, aka cryptophishing, involves good old-fashioned spam mailings. In this case, such e-mails appear to originate with providers of cryptocurrency-related services — Web wallets, exchanges, and so on.
The messages are markedly more detailed and sophisticated than the average phishing e-mail. For example, one might be a security alert saying that someone just tried to sign into your account from such and such address using such and such browser — all you have to do is click the link to check that everything’s OK. The potential victim might even have requested such messages on the cryptowallet site, in which case they will notice nothing untoward.
Please, please, please check your browser URL bar before doing anything on an exchange. If you don’t see the site’s name and you don’t see a little padlock you’re going to have a bad time.
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