Category: Crypto

Bitcoin Bears Say These 5 Metrics Will Stop BTC From Reclaiming $10K

Bitcoin Bears Say These 5 Metrics Will Stop BTC From Reclaiming $10K

Bitcoin (BTC) sellers are pinning their hopes on continuing to see sub-$10,000 prices in the aftermath of the halving based on five key futures market metrics.
The five measures are open interest, funding, long and shorts delta, bearish divergences, and liquidity grab at $10,000.
Open Interest on major Bitcoin futures exchanges stagnantThe open interest — the total amount of long or short contracts open in the market — of Bitcoin futures contracts on BitMEX, Binance Futures, Bybit and other futures exchanges is struggling to increase.
On May 10, when the price of Bitcoin abruptly dropped from $9,570 to $8,100 on BitMEX merely hours before the halving, it liquidated around $200 million worth of longs in a single hour.
At the time, the open interest of BitMEX dropped substantially as many long contracts were either liquidated or forced to adjust their positions.
On May 14, the price of Bitcoin similarly rejected at $9,900, dropping to as low as $9,200 overnight. The rapid pullback caused $42 million to be liquidated. Within a five-day span, at least $270 million worth of longs were liquidated on BitMEX alone.

Bitcoin rejects $10,000 and $9,900. Source: Tradingview
Following the two sell-offs, the appetite of investors in the futures market to enter a trade seemingly declined. It could potentially indicate that buyers are showing signs of exhaustion as selling pressure builds up at a key resistance level of $10,000.
Imbalance of long and short contractsAcross three major futures exchanges Bitfinex, Binance Futures and BitMEX, long contracts account for approximately 72.37% of total open interest.
As of May 15, around $661.7 million worth of long positions are open but only $252 million in short positions are filed. The large gap between long and shorts at a multi-year resistance area leaves Bitcoin vulnerable to a possible long squeeze.

Total Bitcoin longs and shorts in the market. Source: Blockwhisperer
In the past week, Bitcoin experienced two major long squeezes in short time periods. Yet, the market is still heavily swayed towards longs and that means there is a lot of liquidity to be taken in the mid-$9,000s.
Bearish divergences popping upThe Relative Strength Index (RSI) is a momentum oscillator that measures whether Bitcoin is overbought or oversold.
According to a technical analyst known as “CryptoCapo,” when the RSI of Bitcoin decreases while the price rises, it is considered to be a bearish divergence.
A bearish divergence that emerges in an extended price movement suggests that a sizable correction may occur.

Bitcoin shows bearish divergence. Source: CryptoCapo
The declining RSI and the slowing volume of Bitcoin in both the futures and spot markets could lead to dwindling momentum in the near-term.
Liquidity taken near $10,000For large traders, liquidity in a relatively small market is key. The price of Bitcoin typically moves in extreme cycles because whales seek liquidity at a significantly low or high price point.
When the price of Bitcoin rose from the $9,000 to $10,000 range and rejected it shortly thereafter, BTC absorbed large sell orders primarily on OKEx and BitMEX.
The absorption of sell orders at a pivotal range of resistance and two sharp rejections within a five-day span increases the probability of a continued downtrend.

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Reddit’s Blockchain Rewards Will Migrate to Ethereum by 2021

The popular social blogging platform Reddit has confirmed that its tokenized rewards will migrate onto the Ethereum blockchain later this year.
On May 13, Reddit officially revealed its Community Points system, announcing that the feature would be rolled out over two days across “limited communities.”
However, the rewards system will operate on a test-net until autumn 2020 at the earliest.
A Reddit post confirmed that points will comprise ERC-20 tokens, however, the system will not be migrated onto the Ethereum mainnet until after beta.
While the system will initially manifest on the Rinkeby testnet while in beta, a suite of Ethereum-based smart contracts will execute transfers, distribution, and other operations underpinning the reward protocol after the migration.
Points balances accrued in the meantime will also be carried over.
Reddit embraces blockchain rewardsEach subreddit’s points will be donned with a unique name, with the cryptocurrency subreddit’s reward tokens donned “Moons.”
Community Points will be distributed monthly based on individual users’ activity within a subreddit, such as posting or commenting.
The post states that Moons can be freely traded by users, or used for a number of utilities within the r/Cryptocurrency community. Currently, Moons can be used to display reputation, unlock badges, GIFs, and other features, and add weight to voting in polls.
Reddit targets 250 million Moon supplyUsers will also receive an initial distribution based on their score under the existing reputation system, “karma” — with 50 million Moons slated for initial distribution across the r/Cryptocurrency subreddit.
From there, the following month will see $5 million Moons shared among users based on activity — with the total set to decrease by 2.5% each month towards an intended cap of 250 million.
Rumors of a blockchain-based reputational rewards system first surfaced in early April after a screen recording providing an overview of the “points” feature was posted to the r/Cryptocurrency subreddit.
seA cond video was posted a few days later, comprising a walkthrough of the FAQ for the “Community Points” system — which appeared to confirm that the rewards feature would be launched on Ethereum.

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Debate Over Digital Privacy Amid Pandemic Remains ‘Archaic,’ Says Algorand Founder

With some countries beginning to lift lockdown restrictions amid the coronavirus pandemic, many are focusing attention on the technological tools that can help public authorities to comply with the World Health Organization’s guidance for COVID-19 suppression —- “test, trace, isolate.”
This mantra has become all the more resonant in light of the apparent failure of multiple states to implement contact-tracing measures successfully early on in the crisis.
Amid the belated scramble to develop solutions that can safely enable the resumption of some aspects of social and economic life, the debate over tech-enabled contact tracing and movement-tracking has largely been framed as a trade-off between public health and privacy.
Many have argued against the perceived deterioration of legal privacy rights and the intrusion of biosurveillance, in what is presented as a zero-sum game between medical advice and existing cultural norms.
Yet there are others, including those in the blockchain community, who dispute the very framing of the debate itself.
To unpack some of these issues, Cointelegraph interviewed MIT professor and cryptographer Silvio Micali, a recipient of the Turing Award in computer science and Gödel Prize in theoretical computer science.
Professor Micali’s research interests in cryptography include zero knowledge proofs, pseudorandom generation, secure protocols, and blockchain technology. In 2017 he founded the open source, Proof-of-Stake-based public blockchain platform Algorand, where he continues to oversee research into security, theory and crypto finance.
In a recent article, Professor Micali stated that there are broadly two models that have been proposed for developing apps that could help the international community to trace contacts between symptomatic/diagnosed COVID-19 sufferers and healthy individuals — and thus to fall closer into line with the WHO’s guidance.
One type of app would follow a model whereby a government or public health agency would store data in some form of centralized database. The other — as proposed by the likes of Apple and Google — follows a decentralized model, where all the relevant contact information would be stored only on users’ phones.
Micali's proposal, based on blockchain technology, follows a third way — one that recognizes the need for a consolidated overview of all contact tracing data, but provides adequate privacy and data protection for individuals.
Cointelegraph: Can you outline the basic principles that underpin your approach? Why do you uphold that an overall view, which consolidates contact tracing data remains indispensable for policy development and public health measures? In what way would the purely individual-centric model proposed by Apple and Google be limiting?
Silvio Micali: It should be emphasized that the consolidated data we are speaking of is totally anonymized. It is a database of how many qualified contacts are happening every day, nothing more.
A qualified contact is defined as a physically close encounter (e.g., less than one yard) for a sufficiently long time (e.g., at least 10 minutes). Each report is provided by the phone of an individual who has voluntarily opted into the system.
Reports do not disclose the identities of the people, nor those of the phones involved in any qualified encounters. They only report the number of qualified encounters. For instance, the anonymized database consists of the following list of reports, each made by a different phone at the end of the day:
I (whoever I may be) had three qualified encounters today I (whoever I may be) had five qualified encounters today And so on…Even though the information collected is quite minimal, it is very useful for the government to have this information. For instance, when opening or closing the beaches in a given state, the local authority can very easily see how much doing this has increased or decreased the number of qualified encounters.
As a further example, with this consolidated and anonymized data, the government may have a better sense of when to transition from one phase to the next in opening up the economy.
Our view is that when individuals voluntarily help to create such an anonymized database, it is only fair that they can see it too. The goal is to help reduce information asymmetries while protecting the privacy of individuals.
CT: Could you explain the concept of a “shared truth” in a blockchain ledger and how it can help to support COVID-19 contact tracing?
SM: A blockchain ledger is a “shared truth” in the sense that everyone sees the same information. The information to be posted on the blockchain cannot be censored and, once posted, cannot be altered. In our case, the shared truth is a list of anonymized reports of qualified encounters.
In situations such as the public health emergency we are currently facing, having public access to accurate data is critical. Truly decentralized blockchains can be of enormous value in this. Since they require no gatekeepers, everyone, the government and citizens alike, can be assured that the data they are seeing is the same data that everyone else is seeing.
This use of the blockchain builds trust. No one can be accused of fabricating data, because anyone could match the reports in the governmental database with those posted by citizens directly on the blockchain.
Note that even an honest government has an interest in guaranteeing to its citizens that no one can manipulate the reported data. In this case, more citizens are likely to volunteer their anonymized data. And the wider the adoption of the system, the more successful it will be.
CT: How far do you think that the provisions of a technology such as blockchain can help with the breakdown in public trust we’ve witnessed — during the pandemic, but also preceding this crisis?
SM: Trust between citizens and their governments is key for functioning societies. Allowing citizens access to anonymized datasets that they themselves help build is a crucial way of building such trust.
It shows that there are no gatekeepers — the nature of truly decentralized blockchains is such that no gatekeepers are required — and that the government is confident that anyone checking the data will come up with the same numbers as the official ones.
CT: How do you view the limits and possibilities of technological solutions in this context? Some might argue that tech alone is not sufficient in the absence of an adequate debate about the limits of state authority, forms of individual and collective responsibility, and civil liberties.
SM: I am a technologist. I believe in technology. But I also believe that technology is only part of the solution. This said, why not take advantage of the best technology we have available?
CT: Can you give us some more insights into the technological design of your proposal? In layman's terms, can you explain the cryptography involved, different possible variations, and any potential challenges down the line, e.g. scalability?
SM: The Algorand proposal is very simple: use the blockchain to guarantee that (1) the anonymized data reported on governmental websites is indeed genuine and (2) the citizens are given access to the very anonymized data they helped the government to collect.
Algorand uses state-of-the-art cryptography (in particular, verifiable random functions) in order to guarantee that our blockchain is truly decentralized, scalable and secure.
Prior to the advent of Algorand, it was a widespread belief that any blockchain could satisfy at most two of the three mentioned properties: decentralization, scalability and security. It was hard to choose which of the three one should sacrifice: the so called blockchain trilemma!
Solving the trilemma has been a major contribution of Algorand. Now that we can enjoy all these three properties, the blockchain has a much greater potential to help us solve societal problems such as the ones we are currently dealing with.
CT: I'd be interested to hear your observations about the wider media's coverage so far of contact tracing, privacy and technology, as well as any comments on approaches that have been proposed within the blockchain development community.
Contact-tracing is crucial. But so is privacy. More generally, both correctness and privacy are crucial. Naively, one may think that they are necessarily at odds with each other and that one can at most hope to find some reasonable compromise. Yet one of the technological triumphs of modern cryptography is enabling the co-existence of perfect privacy and perfect correctness. But we technologists have not succeeded in explaining this to the public, and every time the debate starts from very archaic positions.
I believe and hope that the media will be more successful in this educational mission than we technologists have been. To each her own trade!

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Why Privacy Is the Main Issue in the Time of the COVID-19 Pandemic

Before the COVID-19 pandemic, privacy was already at a premium. Now, we’re facing a further dive into the uncharted territory of pervasive privacy intrusions.
Targeted advertising tools in your web browser already track your favorite websites, purchases and habits, and browser privacy is a foregone relic. That data is then centralized under the auspices of a big technology firm’s servers and sold to the highest bidder or leveraged to glean a competitive edge.
Governments maintain wide-ranging surveillance on internet communications, and financial privacy is virtually nonexistent for any bank-related activities — encompassing the vast majority of financial transactions.
Most people care about privacy, and some are very passionate about preserving privacy. But people forfeit much of their privacy through ignorance of the technological mechanisms working behind the scenes of their web browser. They care more about the user experience than the often cumbersome hurdle of protecting privacy.
Even though only 14% of millennials believe that the advantages of technology outweigh the risks of sharing personal data, privacy is continually shuttered to the back seat of mainstream discourse. But privacy is quickly becoming the issue of our time, and COVID-19 — a pandemic ravaging cities around the world — may prove to be the spark necessary for people to understand why.
The unseen and the sparkThe general passive response by the broader public around the world to privacy intrusions is worth exploring for several reasons.
First, many people are likely becoming numb to the repeated data scandals that populate the headlines of major media outlets seemingly every week. From Facebook’s Cambridge Analytica debacle, to the Equifax scandal, to the recent dumping of government emails and passwords online during the COVID-19 crisis, data hacks are endemic.
Second, the infiltration of privacy via the web is not a visceral experience. Privacy abuses are silent, working behind the scenes, and they are entirely outside the technical scope of most web users. Ignorance is bliss. The ease with which privacy abuses have proceeded uninterrupted for years has allowed their downstream consequences to fester and aggrandize into severe problems with enormous long-term implications.
And then came COVID-19.
Crises are often an excellent guise for sneaking in further intrusions of privacy at the expense of the public, which is precisely what’s been happening so far.
On the government’s end, a digital dollar has been snuck into the Small Business Administration relief package twice, and the EARN IT Act is a blatant attempt to make encryption illegal on the web. Coincidentally, such legislation that would receive mainstream pushback without a crisis is being considered seriously during a crisis.
The problem is that once apparatuses for abusing privacy are initiated, they’re rarely ever removed with ease. Just look at the Patriot Act and the ripple effect consequences that had on digital privacy.
Big tech firms are also on the receiving end of some highly questionable new developments. Google and Apple's Bluetooth tracing is the manifestation of full-blown cellular tracking of people’s movements, everywhere. Sound Orwellian? It’s because it is. Google and Apple are feigning privacy with gratuitous front-end encryption gimmicks, but the data is still uploaded to their servers.
Related: How to Keep Data Private With Google and Apple’s Contact Tracing App
Privacy is the issue of our time because our control over it has slowly been eroded over time. We may have become numb to some of the broader abuses and high-profile scandals, but eventually an inflection point will happen. At that juncture, we will need lower-cost, user-friendly and powerful privacy tools to meet the demands of the public.
Fortunately, we’re already on the right track.
A wave of new technologyIf COVID-19 ignited a resurgent demand for privacy in the digital age, then the current wave of cutting-edge technology focusing on open-source, peer-to-peer and cryptographic protocols is the foundation to build a new privacy standard — preventing the issue of our time from devolving further into ruin.
The onset of cryptocurrencies sparked a full-fledged grassroots movement in cryptographic primitives. Namely, ring signatures, bulletproofs and zero-knowledge proof technology such as zk-SNARKS. At the heart of these developments are the passionate proponents of privacy who wield number theory and mathematical trapdoor functions to make peering into communications or financial data virtually impossible.
Related: What Are Zk-SNARKs and How Do They Affect Digital Privacy?
For example, the zk-SNARKs used in our company’s protocol obfuscate all transaction details from the public ledger, whether it’s used for decentralized finance applications or simple transfers of large sums of value. Other projects, such as the open-source communications app Signal, rely on encrypted connections between users and are rapidly growing their user bases.
There are even early derivatives of some of the most popular work apps, such as Slack, that focus on privacy. For instance, Keybase is a key directory that maps social media identities to encrypted keys that can be used for coordinating projects and other larger endeavors, similar to Slack.
But privacy often extends beyond encryption and into distribution.
Google and Apple’s servers accumulate the data from all their users, which they hoard and monetize into massive stockpiles of cash. However, open-source and grassroots movements such as the decentralized web, or DWeb — a suite of P2P technologies driving the next iteration of the web — sever the propensity of tech companies to aggrandize data with impunity. By leveraging distributed storage solutions (e.g., InterPlanetary File System), encryption and distributed financial platforms (e.g., Compound), users can interact with similar applications and features without exposing their personal data to third parties.
The user experience was always the limiting factor, though. Previously, maintaining privacy was a hassle that only the most ardent supporters of privacy would go through to achieve a degree of anonymity on the web.
For most users, however, the costs of wielding a virtual private network, private chat app not owned by Facebook or private financial transactions outside the banking system were simply too high.
That’s different now.
For example, our company’s design explicitly caters to a “plug-and-play” audience of businesses, finance professionals and regular users looking to exercise anonymous smart contracts, confidential transactions or a private staking system to generate passive income. Apps such as Signal are climbing App Store download boards, and IPFS is on the precipice of its long-awaited public release.
The new generation of privacy tools is crafted for both individuals and businesses alike. The tools are user-friendly, open-source, don’t monetize your data and are waiting for that inflection point to welcome you aboard a new era of privacy.
You may have never imagined privacy being one of the foremost issues of our time. It has quietly eroded in the background of your favorite experiences as you surf the web. If the COVID-19 pandemic has a silver lining, it’s that the further privacy abuses furtively injected into fiscal relief packages and surveillance under the guise of disease tracking may have awoken the public to the persistent demise of privacy.
The views, thoughts and opinions expressed here are the author’s alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.
Zhengpeng Hou is the CEO of Suterusu, which is working to develop privacy protection over smart contracts, transactions and data for blockchain networks. Zhengpeng is the former director of ZBG Capital and has spent the last 10 years working on software development.

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CZ Calls Africa an ‘Untapped Market’ With Unique Challenges for Crypto

CZ Calls Africa an ‘Untapped Market’ With Unique Challenges for Crypto

Binance founder and CEO Changpeng Zhao, otherwise known as CZ, believes that the African continent holds some unique opportunities for cryptocurrency adoption and development. The Binance leader provided a number of interesting insights during an exclusive “ask me anything” session hosted on Zoom for key members of the African cryptocurrency community, which Cointelegraph participated in.
Binance, which has established itself as the world’s largest cryptocurrency exchange by trade volume, has slowly been opening up satellite trading platforms in a number of African countries. Uganda was the first country to welcome Binance to the continent in 2018.
Binance has since launched trading support in countries such as Nigeria and most recently South Africa, which included the provision of trading pairs and fiat deposits for users using South African rands. The company’s foray into the African continent began in earnest in 2018, as CZ explained during the AMA.
“Even from the first day when Binance launched, we had users from Africa, and they were actually relatively active. So, we’ve always known that Africa is an important market. And so, I think it was early 2018 that I visited Uganda, Togo, Nigeria at the same time — and also Ethiopia. So, I had a little tour around Africa just to learn a little bit more about the market, and soon after that we opened Binance Uganda.”
The past two years have seen Binance branch out into a number of African countries, while its charity arms and incubation services have supported start-ups and made donations to the needy. CZ believes that the continent will become another vital cog in the company’s ever-growing base.
“We view the entire African market as a really key market, and this year we were very lucky to be able to find a good banking partner in South Africa, and we are able to now accept banking deposits directly through bank accounts. […] We will soon be able to launch credit card buying as well. South Africa, and Africa as a whole, is a really important market for us.”
Africa is untapped, but not without challengesAs previously covered during the 2020 Blockchain Africa conference hosted in Johannesburg earlier this year, the continent is ripe for technological innovations that could provide solutions to the huge number of unbanked people. Cointelegraph posed its own question to CZ during the Zoom session, asking if the Binance CEO sees Africa as a relatively untapped market for cryptocurrency exchanges.
Despite the fact that South Africa has a number of local cryptocurrency exchanges that are operating successfully, CZ believes that the rest of the continent could benefit from cryptocurrency exchanges:
“Yes, absolutely. I think that in South Africa there’s a few crypto exchanges — they’re doing quite well. But I believe they are still relatively small. I’m not sure how profitable they are or how sustainable they are. In other parts of Africa, I think the coverage is very weak, is very poor. I don’t think it’s very easy to buy cryptocurrencies in Africa right now overall, so we want to help improve that situation.”
Despite the fact that Binance is rolling out peer-to-peer platforms and its own centralized exchange platforms in certain countries, there is still a lot of room for growth. CZ pointed to the fact that the provision of trading pairs in native fiat currencies is gaining traction in countries such as Nigeria where daily trading volumes have surpassed $1 million per day on Binance.com.
Nevertheless, the sheer number of Africans that are unbanked remains a major barrier to entry, as does basic Know Your Customer processes being carried out due to varying socioeconomic difficulties facing many Africans:
“It is a very much untapped market. There’s a different set of challenges there. I think basically, that’s the reason for it being untapped. Working with banks there is a little bit more difficult. The banking API interfaces are slightly older or nonexistent, and the number of people having bank accounts are quite low. So, even if you have a bank account support, the overall population you can tap into [is] still in the low double digits.”
CZ went on to add that even the most basic things like verifying users have proven to be challenging in some cases: “Many people in Africa does not have Western-style addresses. […] For exchanges that tap into this market, they have to address all of those issues. So, we’re trying to overcome all of those issues.”
Fiat on-ramping is a key driver of adoptionAnother key takeaway from the AMA with CZ was the importance of fiat deposits bringing new cryptocurrency users into the ecosystem. This could become even more important as the world tries to grapple with the effects of the ongoing coronavirus pandemic.
As the founder of Binance explained, the world will have to adapt to new ways of working post- COVID-19, and that could have a profoundly positive effect on the adoption and use of cryptocurrencies:
“I think in the post-COVID-19 world, things will be more digital. They will be more online, more virtual. […] Right now, everyone’s staying home. People are buying things online. You can buy them using fiat currencies, or you can buy them across the world using cryptocurrencies. So, I think the future world, post-COVID-19, is a world that — I think it’s gonna be really great for cryptocurrencies.”
CZ pointed to a number of secondary and tertiary effects of the ongoing pandemic. A major consideration has been the need for fiscal stimulus from a number of central banks, in the form of newly minted fiat currency.
At the same time, Bitcoin has just carried out its third-ever halving event, which saw the block reward from mining halved from 12.5 BTC to 6.25 BTC. CZ believes that both situations will have a positive effect on the cryptocurrency ecosystem as a whole:
“There is a lot of fiat money being printed, while we’ve just gone through the Bitcoin halving. So, the new supply of Bitcoin is actually very limited, and the fiat money is being printed in record quantities now. So, I think the cost of everything will increase very soon. We will see hyperinflation. All of those things are actually really good for cryptocurrencies and for the overall blockchain business.”
That is where providing a proverbial on-ramp for non-crypto users will become a crucial cog in driving the adoption and proliferation of cryptocurrency use in Africa and around the world. The Binance founder wants to create the pathway for that to happen:
“I believe that creating, providing liquidity is […] gonna be a key role, a key feature that people require. […] Imagine a world with thousands or tens of thousands of cryptocurrencies you will have to exchange when you cross from one currency to another. So, I think crypto exchanges will play an increasingly important role in that new world. […] Payments, other things could come later, but right now […] our focus is really just building the bridges so people can enter the crypto space. So, those are the fiat gateways that we’re working really hard to build.”

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Australian Woman Arrested in ‘Cash for Bitcoin’ Money Laundering Sting

An Australian woman was arrested by police at a Sydney shopping centre on May 1, after allegedly selling Bitcoin (BTC) for 60,000 Australian dollars ($38,800) in cash.
According to a report from Daily Mail Australia, the woman is accused of having run a money laundering syndicate in the country since 2017.
Caught red-handedDuring the arrest of the 52-year-old, police seized AUS$60,000 in cash, 3.8 BTC (worth $37,000 at current prices) and a mobile phone. Later, officers searched a nearby apartment, finding more mobile phones, computers and electronic storage devices, along with a further $11,700 worth of Bitcoin.
The woman was charged with three counts of knowingly dealing with the proceeds of crime and breaching digital currency exchange service requirements.
Money-laundering syndicateLocal detectives claim that the woman has been operating a money-laundering syndicate, which they have been actively investigating since November 2018. It is believed that the syndicate has been running since 2017, and has transacted AUS$5 million ($3.23 million) worth of Bitcoin since that date.
Regarding the arrest, Cybercrime Squad Commander, Detective Superintendent Matt Craft explained:
“This is the first arrest executed by Cybercrime Squad detectives relating to non-compliant digital currency providers in New South Wales — and is believed to be the first of its kind across Australia.”
He also sounded a warning to other illicit providers of digital currency exchange, saying, “your actions will not go unnoticed.”
As Cointelegraph reported, Australian tax authorities have recently undertaken major operations to encourage cryptocurrency investors to comply with their tax obligations.
Meanwhile, earlier this month, a top executive from the Australian Taxpayers’ Alliance made her first investment in Bitcoin, to the delight of the local crypto community.

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Forget BTC Price, It’s Now Possible to Trade Bitcoin Hash Rate Futures

Forget BTC Price, It’s Now Possible to Trade Bitcoin Hash Rate Futures

Bitcoin (BTC) holders now have a new tool to leverage the largest cryptocurrency’s growing ecosystem as two new futures markets go live.
In a blog post on May 15, derivatives platform FTX confirmed it had launched a futures product which tracks not Bitcoin’s price, but hash rate.
FTX takes on first Bitcoin hash rate futures Simply dubbed “hashrate futures,” the contracts track the average difficulty of the Bitcoin network each day from the start to the end of each quarter.
The difficulty is used, not hash rate, because as FTX notes, measuring hash rate accurately is impossible.
“However, given that difficulty adjustments attempt to maintain 10m block times, over long periods of time the average hashrate will be proportional to the average difficulty,” the blog post explains.
So that means that, roughly speaking, difficulty futures should behave similarly to hashrate futures.
Hash rate refers to the computing power dedicated to the Bitcoin network at a given time. The more hashing power there is, the stronger and more secure the network.
The mining difficulty is an expression of how complex it is to solve equations, which validate Bitcoin transactions.

Bitcoin 7-day average hash rate 1-month chart. Source: Blockchain
Both were hovering near all-time highs, but the hash rate tailed off following Bitcoin’s block subsidy halving this week. At press time, however, FTX’s hash rate product was outperforming, with Q1 2021 contracts climbing from a value of around 16 to 21.5 on the day.
Contracts due to expire in Q3 and Q4 2020 rose by 6% and 13% respectively.
The contract value is calculated using the difficulty on a certain day, dividing the figure by 1 trillion to arrive at a two-figure number.
Bitfinex leverages rising BTC market capFTX joins cryptocurrency exchange Bitfinex in expanding the futures market. Last week, the platform unleashed futures related to Bitcoin’s dominance versus altcoins.
That relationship is also undergoing a change in favor of BTC, which now accounts for 67.4% of the cryptocurrency market according to data from CoinMarketCap. Bitcoin has managed to maintain at least 60% dominance since July last year.
At the same time, commentators note citing data, the amount of Bitcoin held on exchanges is falling, something they theorize tends to improve price performance.

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HEX Still Can’t Shake Scam Label as Token Approaches $1B Market Cap

HEX Still Can’t Shake Scam Label as Token Approaches $1B Market Cap

While widely written off as a scam earlier this year, Richard Heart’s controversial HEX is fast approaching a $1 billion market cap.
According to crypto analytics site CoinMarketCap, the HEX token had a market cap of over $979 million on May 14 with a value of $0.006 at the time of writing. Prior to mid-February, the value of the coin was so small, many sites simply couldn’t measure it.

HEX is an ERC-20 token that pays holders for rewards instead of miners, essentially a crypto version of a traditional fixed deposit account. Users can lock up funds, then receive their investment plus interest when the term matures.
There are currently only nine exchanges that offer trading on HEX. On Uniswap, the Ethereum decentralized exchange, the 24-hour volume for HEX was $2.4 million, while on Hotbit it was close to $900,000. The remaining exchanges have very low liquidity, including Coinsbit, Bidesk, p2b2b and Bitcoin.com.
A sudden surge?The question is: why this surge in value for a token that most of the crypto media has derided as worthless, if not an outright scam?
True believers on crypto Twitter point to the fact that whales have staked a lot in HEX, and the nature of the token’s rewards benefits the stakers, not the miners:
Some users, tribal though they may be when it comes to crypto, ultimately see the token as reliable, pointing to the high returns of early stakers, “Is Hex is a good investment this early? To me, as an investor, yes. I am up 35x.”
Others simply say HEX detractors are too quick to dismiss the token as a scam instead of doing their research and listening to Heart explain himself, essentially accusing them of confirmation bias.
The HEX founder wrote on Twitter that HEX reached an all-time high price on May 14 and is looking at a $1.1 billion market cap by the end of 2020. He said that for those concerned with the current financial crisis, the token has ”basically less than 0% inflation to the staker class on average.”
Some are still on the fence. One user thinks the crypto community’s reaction to HEX could determine how future coins and innovations are received:
“I feel the crypto community has been through so many scams… when something good comes along for the holder we are blinded. Time will tell how good hex is…”
Still labeled a scam by manyHEX’s critics are legion. Peter McCormack, the host of the podcast “What Bitcoin Did,” has repeatedly referred to Heart as a fraud and HEX a scam.
As Cointelegraph has reported, others have attacked Heart for HEX’s privacy and security concerns regarding its claiming process. Vlad Costea, a writer at Bitcoin Magazine, presented a range of arguments against HEX’s purported legitimacy in January 2019, saying the cryptocurrency “resembles a Ponzi scheme” and was more like “fool’s gold”.
Heart spoke to Cointelegraph in December, admitting the HEX project uses “tactics a scam might use,” but ultimately believing the stigma was due to people in the crypto community being loyal to certain coins:
“In crypto, there’s a tribalism that every coin you buy is a world-changing amazing thing. Every coin anyone else buys is a scam by default.”

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South Korea’s Fintech Sandbox Creates 380 New Blockchain Jobs

South Korea’s regulatory sandbox has helped create almost 380 blockchain and other fintech jobs and generated around $110 million in investments.
According to Shina Ilbo, the sandbox is overseen by the government's financial regulator, the Financial Services Commission, or FSC. It temporarily exempts companies from various regulations regarding financial services to aid with innovation and growth.
The report said that 16 companies have been recognized for their growth potential, and attracted more than 136.4 billion won ($110 million) in new investments.
Some of the companies participating in the government-sponsored program are pursuing business across 14 countries in Asia, including Indonesia, Thailand and Vietnam.
Within the sandbox, the FSC is assessing the usefulness and security of blockchain technology for things like real estate, chatbot services, and artificial intelligence-powered credit evaluation.
Testing environment expandsRegulatory sandboxes like South Korea's have been hailed by many in fintech as a good way for governments to get more comfortable with emerging technology without stifling technological innovation and development.
Throughout the year, the FSC is expected to hold committee meetings focused on different sectors like banks, insurance, and credit .
Cointelegraph reported on May 2 that the FSC authorized nine companies, including those related to blockchain, to operate in the sandbox.
Cryptocurrency exchange Bithumb announced in January that they would invest more than $8 million into South Korea’s sandbox.

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Bitcoin Dip-Buyers Are Now Watching This Level After Another 5% Drop

Bitcoin Dip-Buyers Are Now Watching This Level After Another 5% Drop

At 2 A.M. (UTC) time Bitcoin (BTC) price abruptly dropped 5.11% to $9,256 before recovering to trade in the $9,500 range. This followed a previous sudden drop on Thursday after BTC briefly touched $10K to fill the CME futures gap.

Crypto market weekly price chart. Source: Coin360
Data from CoinMarketCap shows that earlier in the day the price surged to $9,939 and the following consolidation of higher lows and lower highs convinced some traders that further continuation to $10K and above was in the works.

BTC USDT 1-hour chart. Source: TradingView
After the surge to $9,939, traders were watching to see if $9,650 would function as support and the break below the pennant trendline and 20-MA dropped the price below a high volume node on the volume profile visible range.

BitMEX XBTUSD Liquidations. Source: Skew.com
Data from Skew shows the drop to $9,256 liquidated $28 million in BitMEX long positions but as discussed in a recent analysis, after a more than 20% rally since May 11, Bitcoin price was expected to retest former resistance levels to see if they had truly flipped to support.
The 1-hour chart suggests that a period of consolidation at $9,200-$9,300. At the time of writing the RSI is flat in neutral the neutral zone (50) and the MACD histogram remains negative. The Chaikin Money Flow oscillator also remains below 0 and the price continues to notch lower highs.
Scalpers will note that on the 30-minute chart Bitcoin price is already in the midst of an oversold bounce but sustained purchasing volume will be the indicator that will provide the best signal.
Bullish scenarioDespite the $500 correction, Bitcoin’s price is still above the ascending trendline from the recent low at $8,200. In the day leading up to and also during the halving, the price dropped to this trendline, and today’s pullback to $9,256 tapped it again.
If the price can hold above $9,300 and work its way back above the 20-MA on the 1-hour chart, bulls will be ready to attempt a push back above $9,600.
Bearish scenario
BTC USDT 4-hour chart. Source: TradingView
Looking at the 4-hour chart, if Bitcoin price falls below the ascending trendline and fails to find support at $9,200, a drop to the 100-MA at $9,000 is likely.
The VPVR also shows a high volume node at $8,894, which is slightly below the 100-MA, so in the event that the price falls below $9,000, traders will likely look to open positions at this level.
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk. You should conduct your own research when making a decision.

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