The threat is in the potential fallout from the companies behind these coins printing too much fake money and going bankrupt. USDt was supposed to be backed 1:1 by usd. People were asking them to show them proof that it's backed and got none. Finally the company admitted that some of the USDt in circulation is not backed. Who wants to be the last fool to turn their USDt into USD? Not me.
The same goes for all bitcoins on deposit at exchanges, or dollars on deposit at your local bank. Eventually, fractional reserve will take its toll. This is characteristic of all trusted custodial arrangements, not just centralized stablecoins. That's why decentralized stablecoins like DAI are much more interesting to me. It uses economic incentives to pressure the price towards a $1 peg and is completely trustless -- no third party custody. |
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One thing that irritates me about that article is that it alludes to some vague "regulatory pressure" without saying what exactly is going on.
Presumably because they're so much more shitcoin heavy than somewhere like Gemini. There's the securities issue and there might be retrospective hassle from all the junk they've listed over the years. They may not have done anything wrong but they might be getting requests to cooperate with things. When Circle bought Poloniex, the SEC was involved and they indicated they wouldn't pursue enforcement actions for past behavior. But now they seem to be pressuring them to de-list tokens left and right -- Bittrex and Poloniex have both been removing lots of US markets, and Binance booted US traders entirely. That's obviously part of what's going on. They were hoping to be a licensed ATS, fully registered as a broker dealer. The fact that they are now exiting the US market instead spells out that the SEC made it completely impossible. I wonder if this will be the end of the USDC tab
Could be. That's Circle's (and Coinbase's) product, not Poloniex's. |
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Today I read information that a G7 report on cryptocurrency was published.
The authors of this document stated that bitcoin and other cryptocurrencies are not reliable means of payment and seem dangerous for storage.
Nevertheless, the report refers to the fact that stable coins are the exception and that such coins have real potential for everyday use.
The team that conducted the research turned up that not a single global project of stable coins can be legally used until the relevant laws are adopted for control, regulation, etc. My interpretation is that the G7 feels threatened by stablecoins. Libra brought the issue to the forefront, but the ballooning of Tether in market size also seems like a pressing issue for them. As long as Bitcoin is seen primarily as a speculative vehicle rather than a ubiquitous medium of exchange, they don't seem overly concerned about it. |
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We still aren't sure of what's happening. There are many questions.
1/ Has Circle totally dumped Poloniex, or does remain a shareholder in the new company?
2/ Those mysterious Asian investors, do they actually control the new company?
3/ 100 million $ new investments! Really? What for?
... To be continued...
The details are scant so far, but I interpret "full backing" to mean that Circle is dumping Poloniex entirely. Jeremy Allaire will be out of the picture for good: Today we are very excited to announce that Poloniex will be spinning out from Circle into a new company called Polo Digital Assets, Ltd. This new company will have the full backing of a major Asian investment group, who plans to spend more than $100M to develop and introduce new features, assets, and services for their global customer base. In this saturated exchange market, this acquisition only makes sense if Circle is selling at bargain basement prices. I don't know what the hell they're planning to spend $100 million on, especially if they're pulling out of the US market. That number might be exaggerated. This is all future tense anyway; the deal isn't even done yet. |
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...What's with the "farmer" and "pumpkin" references?
I think all answers are provided in the OP or my later posts in this thread. Not at all. I read the OP, watched the video, and then searched the thread. Why is she calling him a farmer? "Go back to your pumpkins and tomatoes and grow a super farm"...? Is she just deranged? I just thought maybe there was more to the story than the ramblings of a crazy person. I guess I was wrong. It doesn't seem meme-worthy at all... |
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Circle announced that Poloniex is spinning out into a new company based in Asia (and backed by a new set of investors[?]). They announced there will be in excess of $100 million in investments in the new company’s platform. I am not sure how they would spend that much money improving the platform, but I would now find it unlikely that lenders will receive additional compensation.
I'm not sure how either, especially since they are pulling completely out of the United States -- no licensing or FinCEN compliance required. It would only take 12-13% of that $100 million to make lenders whole, but I agree it's unlikely given the circumstances. Circle is obviously washing its hands of the situation, and it sounds like they're dumping Poloniex for cheap. |
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Tone Vays continued, claiming that documents published by Wright as evidence allegedly attributing to him the creation of Bitcoin were largely false. Vays said that there is no place for Craig Wright at such conferences.
In response, Wright stated that Vays 'vain ideas' were irrelevant and that his company's patents would generate profits from the largest technology companies in the world. Then it will depend on the individual decisions of people whether they will use the Bitcoin SV cryptocurrency supported by Wright. "But my patents!" How does Wright keep getting invited to these conferences? People are boycotting them over it, and it's just embarrassing for everyone involved. How is this still happening? Farmer Craig! Pumpkin Craig Wright! Go back to your farm, to your pumpkins and tomatoes What's with the "farmer" and "pumpkin" references? |
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whatever leverage the US can gain over Bitfinex to shut down Tether, it's not going to be quite so easy. What are your thoughts on the prospects of that? The apparent focus on stablecoins has everyone thinking about Libra but I'm increasingly wondering about US and Chinese government interest in Tether as its market cap continues to grow, and as they establish their CNH stablecoin. The situation in Hong Kong (where it seems pretty likely that Bitfinex holds it's dollar accounts) no doubt complicates things more...
It seems like they were banking in Hong Kong a year ago. The latest I heard was that they were banking from the Cayman Islands. I imagine they'll bank wherever they can. |
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What is the definition of 'spinning out'?
Is this a de facto letting go of it to completely new operators or just recasting it with a new arrangement in a new jurisdiction? This reads to me like they're selling it off entirely: This new company will have the full backing of a major Asian investment group Circle are slowly becoming almost as good a contrarian indicator as CNBC so I guess this means alt season isn't far away. They got rid of their BTC retailing just before the opportunity to make hundreds of millions of dollars arrived. They bought this just as alts flew down the toilet in early 2018.
They're 2 for 2! This move gives me hope that the market might pick up in the coming months. |
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The G7 and Bank for International Settlements took a jab at Bitcoin in their latest report, saying it has "so far failed to provide a reliable and attractive means of payment or store of value." They seem much more concerned about oversight of stablecoins. The report seems like another nail in Libra's coffin. Bitcoin and other early cryptocurrencies have failed as an “attractive means of payment or store of value,” says a new report from the G7 and Bank of International Settlements (BIS).
However, the October report, argues that widely adopted asset-pegged cryptocurrencies, or stablecoins, such as Libra are a growing threat to monetary policy, financial stability and competition.
Widely adopted stablecoins, dubbed “global stablecoins” in the report, have the potential to reach an international audience and have “significant adverse effects” on the current economic system, it argues.
Meanwhile, “[first generation cryptocurrencies like bitcoin] have suffered from highly volatile prices, limits to scalability, complicated user interfaces and issues in governance and regulation, among other challenges. Thus, cryptoassets have served more as a highly speculative asset class for certain investors and those engaged in illicit activities rather than as a means to make payments.”
Stablecoin taxonomy – defined as a money equivalent, contractual or property claim, or right against an issuer for an asset – will remain a preeminent legal question for the time being, the report continues. The effects of stablecoins on incumbent money systems such as wire transfers have yet to be fully understood as well.
While stablecoins may offer faster, cheaper and more inclusive payments, they can “only be realized if significant risks are addressed.”
In a footnote, the G7 report says the Swiss Financial Market Supervisory Authority’s (FINMA) handling of the Libra Association, which falls under the regulator’s purview in Geneva, agrees with the G7’s stablecoin recommendations.
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Get on Tor, buy some bitcoin at an anonymous exchange, put it through a couple of mixers and hey presto. It certainly makes life easier for the bad guys. Freedom and privacy are a double edged sword. Yes you can do great things with them but you can also do bad things as well. Are we as a community OK with that?
Here's a more important question to ask: What could we do about it?The answer is nothing. You can't stop people from spending and receiving money. You can't stop people from using anonymous payment methods, including cash if nothing else. You can't regulate every monetary transaction in existence, nor should you want to. Child porn was being monetized long before Bitcoin existed. The internet and a broader digitization of money -- credit cards, VCCs, e-money services, online banks, and yes Bitcoin -- allowed this grisly industry to flourish. There's no way you could directly blame anything on Bitcoin, though. If these people couldn't use Bitcoin, they would just use something else. |
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I wonder why most of the pro-bitcoiners appearing nowadays are Republicans? Davidson actually co-sponsored a bill with a Democrat this year that would be really favorable to cryptocurrency investors and startups. It's really unlikely to pass, though -- it supposedly has a 4% chance. I suppose Democrats generally tend towards more nanny state regulations. Republicans -- at least in their rhetoric -- favor less regulation because it discourages innovation. In truth, a lot of Republican rhetoric is hollow and deceptive, though. |
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Also, is there no email confirmation required for withdrawals on Kraken? That's typically a very basic security requirement that all exchanges employ. The OP says their email account was not compromised.
How can there not be? Kraken's guide to request a withdrawal of any coin points out that a withdrawal can only be completed by clicking the confirmation link in the email sent to you. OP, so you definitely checked the session history on your Gmail account and it shows nothing out of the ordinary? No strange IP ranges? If your email was compromised, that gives us one piece of the puzzle. I do find it very troubling that it's always Kraken who I'm hearing this about -- 2FA secured accounts being compromised. I'm very curious to see Kraken's explanation after doing some investigation. They should know what exactly happened by the detail.
It sounds like Kraken plans to keep their lips sealed until a formal law enforcement investigation proceeds. Did you file a police report yet, OP? |
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How do you determine "safe"? Stable price? or the price is rising every time? He seems to think economic and political unrest should precipitate rising prices. I'm not even sure how confidently we could apply that thinking to the most reputed "safe haven" asset, gold. Gold declined 45% from 2011-2015, though I'm sure one could point to times of political/economic upheaval during that period too. Bitcoin isn't a safe haven, it's a hot mess.
Thanks to Blockstream we have 1 MB blocks and a network that's been converted into an L2 custodial system and settlement layer.
Let's not be disingenuous. Almost every block is larger than 1MB now because of Segwit's block size increase. Limiting block space is literally the only way to ensure that fees replace the initial mining subsidy, as the design entails. If you're not willing to compromise, there's always BCH, BSV, or an endless list of other altcoins to choose from. |
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my mind always asks, if one day bitcoin gets legal regulation, and is recognized all over the world. will fiat currencies continue to work? Why wouldn't they? The sustainability of fiat currency has little to do with Bitcoin. They are orthogonal. Bitcoiners tend to lean towards the Austrian end of the economic philosophy spectrum -- most will tell you that fiat currencies are destined for collapse either way. I think they're probably right about that. Furthermore, gold is still probably the leading candidate for underpinning a post-fiat monetary system, not Bitcoin. |
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I can't believe they're going to leave it as is. One of their documents mentioned that they were waiting for feedback and hopefully they get plenty of it.
The bit about forks and airdrops simply doesn't make enough sense at present. Fuck knows who wrote it but they need slapping upside the head.
'If you did not receive any cryptocurrency when an airdrop event occurred, you do not recognize income as you did not receive the property.'
What airdrop does not give you crypto? And what is the EXACT definition of receiving? That was likely written with exchanges in mind. If an exchange credited you with forks/airdrops based on your balance, then receipt occurs. My reading of the guidelines is that if you controlled your own keys, the fair market value of hard forks was $0 at the time of receipt since no markets existed yet. Futures markets or chain split tokens are different assets. “One unfortunate consequence of this guidance is that third parties can now create tax reporting obligations for you by simply forking a network whose coins you own, or foisting on you an unwanted airdrop.”
The first situation probably isn't possible. A hard fork falls under the situation I outlined above. Centralized airdrops -- like when a developer team air drops ERC-20 tokens into ETH public addresses -- could result in unwanted tax liabilities, though. Fortunately, these airdrops are probably worth far too little for the IRS to pay any attention. |
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If Bitcoin is supposed to be a safe haven, why is BTC price keeps going down, down, and down while the world is on fire. The news that Turkey just invaded Syria should be positive news for Bitcoin. Oh, Iraqis going at it, Hong Kong, Haiti. What's going on folks?
I'm really not convinced about this theory that war and economic upheaval are good for Bitcoin. Price discovery for Bitcoin began in 2010, so it's existed -- and flourished -- under very positive economic conditions. Continued growth, bullish stock markets, etc. If it's done so well under these conditions, what makes you think it would benefit from economic uncertainty? There are very few assets (if any) that perform well during financial crises. A decade into this grand experiment, I don't expect Bitcoin to be one of them. Plus, Bitcoin went up over 300% earlier this year. Some decline should be expected no matter what the broader economic conditions are. |
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So, after almost three months, is anyone using it?
It doesn't seem like many people are. Aside from a couple 300+ volume days, their BTC/USD volume is usually below 20 per day -- probably not the splash they were hoping to make. They are performing considerably worse than Binance.US despite launching nearly two months earlier. I'm not sure why, but CMC also isn't reporting any data for them at all. https://pit.blockchain.com/trade |
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