Weekly Roundup: Is the Worst of the Burst Finally Over?
In this week’s edition, we take a break from our (all-too-usual) sourness and negativity to recognize some of the lights at the end of the tunnel for the crypto markets, which have been anything but fun for almost the entirety of 2018, so far. We explain why big money talks, why governments listen, and how merchant adoption of bitcoin is on the rise, despite declining prices of BTC. In order to understand how this could possibly be, its best to remember that bitcoin is meant to be a currency and not an investment vehicle, and that in the spirit of Satoshi Nakamoto’s vision, investing in bitcoin should be as boring as investing in the dollar or the euro.
Markets Breathe a Sigh of Relief
In an increasingly rare glimmer of optimism, all 10 of the top cryptocurrencies by market capitalization (market cap) finished the week in the green, with bitcoin ending up 2% for the week and NEO (NEO) posting the biggest gains at 15%. The total market cap of all coins climbed its way back above the $250 million mark and the bitcoin dominance of this total began to fall ever so slightly, signaling that investor appetite for riskier altcoins might once again be on the rise.
Meanwhile, analyst estimates of the price of bitcoin remain as varied as ever, with a recently-published article by Forbes magazine outlining all the different scenarios in which the price of BTC could end the year anywhere between $1,000 and $30,000 per coin. Regardless of its unpredictable price movement, there’s little doubt that bitcoin is here to stay. Federal governments, central banks and financial regulatory bodies worldwide are finally coming to accept that cryptocurrency isn’t just a fad, which they are pretty much compelled to do now that the ultra-rich are throwing fistfuls of dollars at the market.
Add billionaire George Soros to the list of finance gurus willing to take a calculated leap of faith into cryptocurrency. Soros, the 87 year-old Hungarian-born investor, was among those to describe cryptocurrency as being in a “bubble” earlier this year, but had the foresight to predict that it would not burst in a fashion similar to most other commodity bubbles, characterized by a “sharp break.” Rather, Soros saw the bubble as slowly deflating before regaining some of its buoyancy, and thus far, time has proven him to be correct in his assessment. With crypto prices looking cheap, he announced that his investment firm, Soros Fund Management, would now use some of its $26 billion in assets to invest in cryptocurrencies — a bold move that is unparalleled among icons of his magnitude.
Retail Usage of BTC on the Rise
Earlier this week, US electronics retailer Newegg expanded bitcoin integration to its platform in Canada, allowing its customers there to pay for products using bitcoin.
“In 2014, Newegg was among the first major companies to offer customers a bitcoin payment option,” said CEO Danny Lee. “Since that time the value of bitcoin has skyrocketed and customers holding bitcoin have considerably more purchasing power. We believe the time is right to broaden our acceptance of bitcoin to our customers in Canada.”
Other big-time retailers that accept bitcoin include Overstock, Expedia, eGifter, Gyft, Dish, and CheapAir. After a brief pause in service, Microsoft resumed its acceptance of bitcoin as a method of account funding earlier last month. Those with Microsoft accounts can now use bitcoin to purchase not only software and video games, but in-game items for their globally-popular Xbox console series as well.
The list of companies currently considering the adoption of cryptocurrency for payment now includes Amazon and Starbucks. The coffee giant employed the use of QR code scanning by cell phone as a form of payment even before the creation of the first bitcoin mobile wallet app and has been a trend-setter when it comes to adoption of digital financial technologies.
Like any other mega-corporation, Starbucks did not achieve is momentous success by adopting ineffective strategies or choosing a more expensive alternative for business functions. Instead, CEO Howard Schultz is waiting for the cryptocurrency craze to subside and fall back to an economically sensible reality before deciding which coin(s) to accept for payment. The coins left standing after this year’s bloodbath will likely be the ones ready for prime-time use, and this list does not necessarily include bitcoin, according to Schultz.
Some other major vendors that currently accept bitcoin (at least in some areas) include:
- Etsy (handmade crafts)
- Expedia (travel agency)
- Grooveshark (streaming music provider)
- Intuit (tax preparation service)
- KFC Canada (chicken… Canadian chicken)
- Lionsgate Films (movie production company)
- com (theater ticket retailer)
- OkCupid (dating website)
- Playboy (adult entertainment)
- Shopify (e-commerce platform)
- Subway (sandwich artists)
- Virgin Galactic (Richard Branson’s airline)
- Wikipedia (user-built encyclopedia, for donations)
Click here for an expanded list of BTC-friendly retailers, courtesy of 99bitcoins.com.
India, Pakistan and the Islamic World Still Not Keen on Crypto
There are over 1.6 billion Muslims in the world. Yet many of them will never have legal access to cryptocurrency trading. According to Sharia law, bitcoin is regarded more as an instrument for gambling and speculation rather than a currency and thus its use is forbidden in many Islamic countries around the world. Pakistan, an Islamic nation where bitcoin managed to fly under the radar for quite some time, recently announced a crackdown on cryptocurrency trading, causing its most popular exchange, UrduBit, to close its doors for good, angering thousands of customers while leaving them without a sanctioned way to acquire or sell cryptocurrencies.
While bitcoin itself is deemed to be Sharia non-compliant, a Dubai-based company called OneGram has found a way around the problem by going to great lengths to insure that its gold-backed cryptocurrency meets all standards dictated by Sharia law. OneGram has fought hard-lined extremists tooth-and-nail to remain in existence, with its main case being that it lacks the volatility normally associated with cryptocurrencies because its token is tied to the value of one gram of gold.
Neighboring country India has also taken some draconian steps in its policy toward cryptocurrencies, which were immediately criticized as potentially inducing a “brain drain” for the fledgling, 3rd-world nation. With a Gross Domestic Product (GDP) per capita of $1,709 (compared to the United States’ figure of $57,467), the potential benefits for financial transaction cost reduction via implementation of blockchain-based systems are huge, yet will remain largely stifled until a more thought-out approach is implemented in the form of ratified public policy.
Also in the News
- The once-famous (and now infamous) ex-Bitcoin Core developer Roger Ver is the subject of conversation among the bitcoin community again with his latest round of inflammatory tweets; this time claiming that “Bitcoin Cash is Bitcoin,” Ver has been on an anti-BTC crusade since the Bitcoin Cash (BCH) fork on August 1st, 2017, using his power as administrator of bitcoin.com to deceive website visitors that Bitcoin Cash is the “real” bitcoin. Critics are finding the logic hard to swallow given that the symbol for bitcoin is BTC and the symbol for Bitcoin Cash is BCH.
- In a follow-up to our saga chronicling the misadventures of the Floyd Mayweather-backed Centra Tech (CTR) token, which is currently under investigation by the SEC, mega-exchange Binance announced it would no longer be supporting the token due to its ever-amassing legal problems, making it the last of the major exchanges to delist CTR from trading. On the upside, Mayweather announced yesterday that he would “come out of retirement” to consider fighting defeated opponent Conor MacGregor in the UFC octagon, providing a great degree of excitement for some and an even greater degree of humor for others.