A reminder: This week at TokenReporter we’ve instituted a few changes. First, the newsletter will cost $20 a month or $100 a year (it is $60 a year for a limited time if you’d like to invite friends.) If you’ve received this newsletter in your inbox then you’re golden - I’m grandfathering in the 5,000+ folks who have been reading this for a while. This small amount of cash allows me to add a new mid-week post as well as hire some new talent so be on the lookout for changes in the system. I encourage you to tell friends and neighbors about the site and the newsletter.
Second, I’m expanding the newsletter to twice weekly, with a bit more token discussion coming to you every Wednesday. Look for it in your inbox this week.
Now on with the show.
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Need to Know 🚀
This week has been tough on both equities and tokens. Bitcoin, Ether, and most ERC 20 compatible tokens - essentially the tokens used by most ICOs - took a beating. As one friend wrote on Facebook: “This is a hard week to launch a token sale.”
What is causing the dip and how low (or high) will it go? As I posited on Monday, the news cycle for crypto is a mess. A post that goes up one day will counter a post the next day. Conspiracy theories run rampant and an ounce of SEC clarity is enough to move the market by $2,000. From CoinDesk:
"I believe every ICO I’ve seen is a security," Securities and Exchange Commission chairman Jay Clayton declared early on, perhaps setting the tone on a topic that would be raised numerous times during the roughly two-hour hearing. He largely echoed his past remarks on the subject, criticizing the “gatekeepers” of such offerings in the market today.
At one point, Massachusetts Senator Elizabeth Warren asked Clayton whether any ICO, past or future, had been subject to SEC registration.
"Not one," he answered to both.
What do you need to know this week? Two things:
Fundamentals haven’t changed - nothing China or Singapore or the SEC can can “harm” cryptocurrencies. While I agree that regulation is sorely needed in the space, crypto is not a governmentally-controlled organization. It routes around damage like the Internet and it is literally impossible to stop unless its users stop trading. Smell a little like a Ponzi scheme? Ehhhh… the jury is still out but I support the technology because it is a technology and not a financial instrument. The Internet of Value is probably the first technology of the 21st century to enact global change.
Bitfinex could cause a halving of BTC price - I am currently investigating a number of very interesting claims that purport that major Bitcoin exchange Bitfinex has been propping up bitcoin prices with something called wash trading - allegedly creating transactions that make it look like like real activity, thereby maintaining inflated prices. The more I dig the stranger things become, as I always recommend, please use a hardware wallet like Trezor to keep your horde in cold storage. I rarely if ever maintain a balance on any exchange.
I’ll keep you posted on the Bitfinex exploration.
See you next Monday!