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Bitcoin Price Dips Below $10K as BTC Shrugs Off Its First Fed Rate Cut

Bitcoin (BTC) price fell back below $10,000 on August 1 as markets broadly shook off the first Federal Reserve interest rate cut since 2008.

Market visualization

Market visualization. Source: Coin360

Bitcoin doesn’t care about the Fed

Data from Coin360 showed the largest cryptocurrency hovering just below the significant barrier once more Thursday, having climbed as high as $10,138 in the past 24 hours. 

A sudden uptick took BTC/USD $500 higher Wednesday, a move which itself followed a dramatic downturn over the weekend which saw the pair shed $800 in minutes.

Bitcoin 7-day price chart

Bitcoin 7-day price chart. Source: Coin360

The temporary return to $10,000 accompanied fresh debate on crypto and blockchain regulation in the United States, while this week’s rate cut also served to fuel excitement among traders.

As various sources noted, the cut was the first from the Fed since Bitcoin’s creation over ten years ago. 

“In preparation for the halving, the Federal Reserve is cutting interest rates to further highlight Bitcoin’s economic innovation. Everybody, be sure to thank Jerome Powell for sticking to the Bitcoin as store of value thesis!” Michael Goldstein, president of the Nakamoto Institute, commented on Twitter about the event.

At press time, however, Bitcoin appeared broadly unaffected by U.S. economic policy compared to its behavior in light of regulatory noises throughout last month. 

As Cointelegraph reported, mixed messages from Congressmen and others produced significant volatility, with BTC/USD still down $4,000 versus its July highs. Compared to exactly one month ago, however, the pair has tracked neither up nor down. 

Altcoins stagnate further

A similar picture presented on altcoin markets. Sideways action has defined the top twenty cryptocurrencies by market cap in recent days, tokens moving in step with Bitcoin. 

Ether (ETH) the largest altcoin by market cap, moved up by a modest 0.7% on Friday to hit $213, having spent the past week in a corridor between $200 and $223.

Ether 7-day price chart

Ether 7-day price chart. Source: Coin360

Other major alts broadly replicated such behavior, an exception being Litecoin (LTC), which gained 4.8% to lead the market as its halving is now less than a week away.

By contrast, Bitcoin Cash (BCH) and its fork, Bitcoin SV (BSV) both lost around 2.5% in Friday trading. 

The total cryptocurrency market cap stood at $273 billion, with Bitcoin’s share at 65.1% of the total.

Keep track of top crypto markets in real time here

Bitcoin Recovery Breaks Back Over $10,000

Wednesday, July 31 — After falling below the $10K barrier on July 27 and splashing around in the mid-$9,000s for the intervening days, Bitcoin (BTC) is back in the five figures as of 3:15 PM UTC.

Infographic courtesy of CoinMarketCap

Infographic courtesy of CoinMarketCap

After starting the day around the $9,500 price point, BTC has seen steady increases on the day so that the token is up 3.88% on the day, which has seen general green across cryptocurrencies.

Charts Courtesy of CoinMarketCap

Charts Courtesy of CoinMarketCap

With a market cap of $178.5 billion, the largest cryptocurrency has slipped somewhat since a late-June bull market saw BTC peak just shy of $13,900, a price point that had, in turn, not been seen January of 2018.

Chart courtesy of Coin360

Chart courtesy of Coin360

Yesterday saw hearings on broad crypto regulations before the US Senate Banking Committee, during which Committee Chair Mike Crapo stated that: 

“If the United States were to decide we don’t want cryptocurrency to happen in the United States and tried to ban it, I’m pretty confident we couldn’t succeed in doing that because this is a global innovation”

This week also saw $55,000 predictions for BTC from a formerly bearish Joe Kernan of CNBC.

Bahrain Crypto Exchange Gets Central Bank License in Middle East First

Bahrain-based cryptocurrency exchange Rain has become the Middle East’s first exchange to receive a regulatory license.

In a blog post from July 31, Rain confirmed it had received a Crypto-Asset Module (CRA) license from the Central Bank of Bahrain.

The license came the same week Rain announced successful closure of a $2.5 million funding round backed by partners including the V.C. arm of crypto derivatives giant BitMEX. Kuwaiti blockchain fund Blockwater also contributed. The blog post reads: 

“With this license, Rennes has become the first encrypted currency trading platform in the Middle East to be fully licensed by a regulatory entity and join a limited range of internationally recognized platforms for currency trading.”

As Cointelegraph reported, the Middle East market has traditionally proven a tough environment for crypto businesses, specifically those involved in trading. 

Islamic banking laws forbid certain types of transactions, with scholars in different jurisdictions giving conflicting opinions as to whether cryptocurrencies such as Bitcoin (BTC) conform to norms that frown on speculation and interest lending. 

Rain did not mention the issue, instead stressing its position as a fully-compliant financial operator and ability to form meaningful ties with local banks. The blog post continues:

“Through licensing, we have demonstrated our commitment to the terms of the encrypted assets unit in terms of capital adequacy, cybersecurity, insurance, reporting, governance and other matters that ensure our readiness to provide our services to both institutional and individual clients.”

July meanwhile saw additional recognition of cryptocurrency activities across the Arabian Gulf in Iran, where the government took steps to formally condone Bitcoin mining after a period of jockeying within different governmental ministries.

Live: Crypto, Blockchain Hearing at US Senate Banking Committee

During today’s United State Senate Banking Committee hearing on the regulatory framework for cryptocurrencies and blockchain, Cointelegraph will be updating live with the most important developments. 

The July 30 hearing, titled “Examining Regulatory Frameworks for Digital Currencies and Blockchain,” follows the previous hearings in mid-July that examined the regulatory hurdles surrounding Facebook’s Libra.

Circle CEO Jeremy Allaire will be a witness today in front of the Senate Committee on Banking, House, and Urban Affairs on behalf of The Blockchain Association, along with Rebecca M. Nelson, a specialist in international trade and finance, and Mehrsa Baradaran, a professor of law at University of California, Irvine School of Law.

For more detailed information on the witnesses, Cointelegraph has a dedicated analysis here.

11:25 a.m. EST

Crapo: I want the U.S. to stay at the forefront of this technology, which both has incredible potential and incredible risk.

11:22 a.m. EST

Nelson: Facebook has changed the debate about cryptocurrencies

11:15 a.m. EST

Barabadan sees similarities in the resistance of tech companies to regulation in the same way that big banks are resistant to regulation.

11:16 a.m. EST

Brown asks what lessons we can apply to tech companies after the 2008 financial crash, and Barabadan says that there is a fear that the U.S. will lose its tech edge if it doesn’t let these companies grow unfettered.

11:13 a.m. EST

Brown: “If there aren’t really new products, why would we need rules and regulations?”—Brown going off the idea that the ideas are the same for financial instruments, just new technology backing them.

11:10 a.m. EST

Crapo: how does Libra gain global acceptance if it’s facing every country’s different regulatory climate?

Allaire: some of these cryptocurrencies are just open source software that exists on the internet and runs everywhere the internet exists (“even interstellar”).

Allaire: “Digital money will move frictionlessly, everywhere in the world, at the speed of the internet, hopefully with a high level of security and data protection.”

11:08 a.m. EST

Allaire notes that there are larger opportunities for digital assets and blockchains outside of the United States. When looking for locations, Circle wants a high bar from a regulatory perspective, from a custody risk in particular, as well as clear definitions. 

11:04 a.m. EST

U.S. Senator Jon Tester of Montana appears concerned about Libra being compromised the same way that a credit or debit card can be.

“Would it kill cryptocurrency in the laws that we are probably going to be passing […] if we stipulated that it had to be a 1:1?”

11:02 a.m. EST

Nelson brings up money laundering as a big concern for cryptocurrencies around the globe, but says that some licensing, reporting, and transparency requirements can help with these concerns.

11:01 a.m. EST

Nelson thinks that some crypto hubs are using regulation as a way to attract crypto to their borders, using clarity and certainty to bring people in to their jurisdictions.

10:58 a.m. EST

U.S. Senator Christopher J. Van Hollen of Maryland on real-time settlement: “Our failure to have moved forward with this technology […] is costing millions of Americans, billions of dollars every day.”

10:56 a.m. EST

Cortez Masto asked Baradaran why digital currencies cannot bank the unbanked. She responds that the problem is that these people live in “banking deserts.”

Baradaran: “How does any digital-based currency help when people are operating in cash?”

10:53 a.m. EST

U.S. Senator Catherine Marie Cortez Masto of Nevada believes in the potential of blockchain, and the importance of leading in this technology over China.

10:51 a.m. EST

Schatz: “I don’t doubt the potential for this tech, I just don’t think that it’s going to actually bank low-income communities, and I don’t think you’ve persuaded anybody here that it’s going to do so.”

10:49. a.m. EST

Schatz keeps bringing up the idea that not everyone has a smartphone, and so it’s hard to place bets on this technology to solve all of our problems and “leap over all existing ones.”

Allaire rebuts by saying that technological innovation can be slow, comparing now to the beginning of the internet, of the slow implementation of broadband.

10:48 a.m. EST

U.S. Senator Brian Schatz of Hawaii asks if we are anywhere close to democratizing the use of technological products, following up on the overall financial inequality topic.

Schatz: “What it sounds like to me is tech people wanting to wave a wand and skip a bunch of steps and avoid the tough political of doing things for people.”

10:42 a.m. EST

U.S. Senator Mark Warner of Virginia is asking about the literal meaning of the 1:1 backing of the Libra.

Allaire comments that while the first wave of these types of digital currencies were focused on establishing a global digital currency, the critical mainstream use cases for the financial services sector has needed the development of stable coins, with Libra as an example.

Allaire now brings up the Circle consortium’s USD Coin as another example.

Warner responds by asking: if there is a basket of currencies backing the Libra, doesn’t that create currency risk?

Warner: “If you have a 100% reserve, where is Libra going to make money on this?”

10:36 a.m. EST

Baradaran is now speaking about the ways that people have tried to bank the unbanked and how those past attempts have failed, aligning those past failures with some of the stated goals of cryptocurrencies.

Baradaran admits that while  blockchain is “amazing,” the hearing is about digital assets and the blockchain, and what is really going on in these markets. She repeats that the problems of the unbanked are policy problems, not technological.

10:34 a.m. EST

Allaire notes that we should regulate digital assets, but that we need new definitions of them as an asset class.

10:31 a.m. EST

Allaire: “Regulations around the custody of assets is a really critical need.”

Crapo then brings up Poloniex moving to Bermuda, and Allaire says that there is a big problem for digital assets fitting into definitions in our current financial systems. 

“Unfortunately, in the United States, the guidance that the SEC has given is extremely, let’s just say, narrow, in terms of what they deem to not be a security.”

10:29 a.m. EST

Professor Mehrst Baradaran: “There is yet to be an innovative technology that has eliminated the risks and frauds and crimes that regulation is meant to combat.”

Moving to the blockchain doesn’t protect from these risks, in Baradaran’s opinion.

10:23 a.m. EST

Professor Mehrst Baradaran believes it’s natural that people have embraced Bitcoin in the aftermath of the 2008 financial crisis.

However, she adds that the current problems in our economy are issues of policy, not of technology, so blockchain is not necessarily the answer. According to Baradaran, we already have a public ledger, it’s called the Federal Reserve.

10:22 a.m. EST:

Dr. Rebecca M. Nelson thinks Facebook could be a game changer for cryptocurrencies, but it has raised both regulatory and systemic concerns before it can be implemented.

10:18 a.m. EST:

Allaire thinks that current restrictive atmosphere has led companies to domicile overseas, rather than in the U.S, and that Congress should define digital assets as a new asset class.

Allaire: “We are in the process of moving our international facing services and products out of the United States.”

10:15 a.m. EST:

Jeremey Allaire speaks about his views on the troubles of our current financial system, including cybercriminals, hostile nations, and a lack of equal access.

Allaire: “There absolutely can be a better future ahead, one built on digital assets and blockchains.”

10 a.m. EST: 

Senator Michael Crapo of Idaho: These technologies are inevitable, they could be beneficial, and the United States should lead in this sector.

Senator Sherrod Brown of Ohio: “Facebook has proved over and over […] that they can not be trusted. But they don’t care. They move fast, they break things. Minor things, like our political discourse and journalisms and relationships and privacy. Now they want to break our currency and payment systems, hiding behind the phrase ‘innovation.”’

Capital One Hack Exposes 100 Million Accounts as Bitcoin Unaffected

The massive-scale hack of major United States credit card issuer Capital One has left the personal data of over 100 million individuals exposed.

As CNN reported on July 30, confidential data for around 106 million Capital One customers’ accounts and credit card applications was stolen by an alleged hacker, Paige Thompson, 33, in March of this year.

Capital One: a centralized trove of KYC data

Thompson, a Seattle resident, was arrested by the FBI on June 29 and is accused by the US Department of Justice of having gained unauthorized access to personal data that included names, addresses, zip codes, phone numbers, email addresses, dates of birth and self-reported income. 

All this data is collected by Capital One “routinely” each time it receives credit card applications, the company has revealed in an official statement.

Thought to have affected roughly 100 million United States customers and 6 million Canadians, the suspect allegedly gained access to 140,000 Social Security numbers, 1 million Canadian Social Insurance numbers and 80,000 bank account numbers, as well as data pertaining to customers’ credit scores, credit limits, balances, CNN reports.

According to CNN, Thompson had formerly worked as a software engineer for a cloud hosting company used by Capital One. Her access to the company’s servers was facilitated by exploiting a misconfigured web application firewall, CNN reports, citing court filings.

‘No one has ever hacked Bitcoin’

The major breach of a centralized repository of Know Your Customer data reveals the fault lines of corporations’ custody over their clients’ data. The crypto community has been quick to reflect on the flaws of such legacy models as compared with more resilient, decentralized systems. As Morgan Creek Digital Assets co-founder Anthony Pompliano tweeted today:

“No one has ever hacked Bitcoin. It is the most secure computing network in the world.”

While security breaches of centralized crypto exchanges are still commonplace, to “hack” Bitcoin, a potential attacker would have to gain access to the private keys of every single wallet address individually — rather than one centralized trove like Capital One’s.

Capital One has stated that “unlikely that the information was used for fraud or disseminated by this individual,” and that “no credit card account numbers or log-in credentials were compromised and over 99% of Social Security numbers were not compromised.”

As CNN notes, the suspect nonetheless revealed her intentions on Twitter to distribute the ill-gotten confidential information, such as Social Security numbers along with full names and dates of birth.

As Cointelegraph has reported, privacy concerns in an era of far-reaching data centralization are spurring the development of secure, decentralized blockchain-based alternatives from major tech players such as Microsoft.

In an interview with Cointelegraph this summer, BitMEX CEO and co-founder Arthur Hayes underscored the importance of financial privacy. He argued that the public is on the brink of a sudden wake-up call in light of the unmistakable negligence and misuse of individuals’ digital property and identity credentials, as well as incursions into their on — and offline freedoms.

Judge Rules to Extend Bitfinex and iFinex Case in New York

Justice Joel M. Cohen of the New York Supreme Court (NYSC) has ruled to extend the preliminary injunction in the ongoing case of crypto exchange Bitfinex and Tether’s parent company, iFinex, against the New York Attorney General (NYAG), on July 29.

Cohen reportedly decided to give a 90 day extension to the case, which apparently means that OAG can continue investigating. Lawyers of Tether tried to appeal to dismiss the motion immediately, but Cohen rejected their appeal.

Speaking before the court, iFinex also argued that the court does not have subject matter jurisdiction because Tether is not a security or commodity as there is no futures market. The companies’ defense also stressed that Tether and Bitfinex are two different companies with two different business models, and that it is not proper to treat them as a single entity as the OAG does.

How it all began

Back in April, NYAG Letitia James revealed that her office obtained a court filing alleging that iFinex Inc. and their associated entities were in violation of New York law in connection with activities that may have defrauded New York-based crypto investors.

Bitfinex allegedly lost $850 million in client and corporate funds, and then attempted to cover up this loss by secretly helping itself to around $900 million of Tether’s cash reserves. iFinex subsequently responded that the OAG’s claims were “riddled with false assertions” and that the lost $850 million is being safeguarded.

iFinex further applied to have the case dismissed, arguing that the OAG has no legal basis to sue it for the simple reason that Bitfinex wasn’t operating in New York during the period at issue. In early July, news broke that New York-based Metropolitan Commercial Bank closed of a New York-based bank account, indicating that Tether and Bitfinex may very well have been operating in the state of New York.

Following the news, lawyers for Bitfinex and Tether submitted multiple fillings on July 22 alleging that the companies never served customers within New York. The lawyers argued that even if the NYAG were successful in showing that the companies served New York residents, they have not established that the investors were affected by the companies’ activities. The parties’ representatives stated:

“For purposes of personal jurisdiction, OAG cannot show Respondents engaged in any business activity purposefully directed at New York. OAG tries to confuse matters by referring to isolated instances where Respondents’ foreign customers have shareholders or other personnel in New York. But in those circumstances, Respondents’ counterparties — the ones with which Respondents actually transacted business — are the foreign entities.”

3 Reasons Analysts Are Bullish on Bitcoin Despite 33% Price Correction

As Bitcoin dropped an additional 8% on Saturday, naysayers claim the rally to a new all-time high is over. So what is it that’s keeping market analysts bullish in the face of a 33 percent correction? 

Bitcoin price bears draw a line at $10,000

Bitcoin’s most recent price action has been less than satisfactory, unless you’re a bear. To date, the top digital asset is down 32% from it’s 2019 high of $13,739 and short term price action remains overwhelmingly bearish. 

Over the past two weeks Bitcoin formed an M-top at $13,739 and $13,177 before dropping to the neckline around $9,600. Most traders expect that Bitcoin will retrace to the 61.8% and 50% Fibonacci Retracement level which is also near the CME futures gap. It’s possible that the group think surrounding the CME gap is causing it to function as a magnet, drawing BTC price nearer to the $8,500 – $7,500 range. 

BTC/USD

Traders will also have noted that Bitcoin has dropped out of the broadening wedge that had carried it from $4,000 to the 2019 high and the parabolic trend is long negated, hence the probability of a revisit to the 61.8 Fib retracement. 

So, the short-term outlook is bearish. Yet several analysts across the sector remain extremely bullish on Bitcoin’s long-term price action. Let’s have a look at some of the key factors which are influencing their opinion. 

Dormant Bitcoin wallet address hit new all-time high

Earlier this week Coin Metrics released a report showing Bitcoin’s untouched supply reaching a new all-time high of 21%. 

BTC Untouched Supply

The amount of unmoved Bitcoin has increased significantly over the past five years and coins falling into this category have been held in the same wallet address for 180 days to 2 years. This suggests that Bitcoin is increasingly becoming a store of value rather than a medium of exchange. One could assume that if Bitcoin’s price continues to rise, so will the number of unmoved Bitcoin. 

Not everyone supports this conclusion, however. Adamant Capital founding partner Tuur Demeester countered saying that: 

“I’m not so sure […] 5 years without updating your cold storage method is a long time in Bitcoin. Imo most of these coins are likely lost.”

While Demeester could be right, taking a deeper look at the Coin Metrics chart shows that the number of untouched coins on the 1800-day and 1-year time frame has noticeably increased with compared against longer-time frames. This increase also aligns with Bitcoin’s price increase in U.S. dollars. 

Ultimately, the given report shows a correlation between increases in Bitcoin price and the amount of wallet addresses holding the digital asset as a store of value. 

Start of new bull markets coincides with miner capitulation, data shows

On Saturday expert crypto-analyst PlanB tweeted a rather intriguing chart that he and ParabolicTrav worked on.

Bitcoin bull markets start at difficult bottom

According to the analysts, after a BTC/USD rally reaches its peak, a massive amount of Bitcoin is available at lower prices. The start of new Bitcoin bull markets have coincided with miner capitulation and Bitcoin price tends to rise from these bottoms to grow 100 times. 

According to PlanB:

“We saw difficulty bottoms (miner capitulation) in Dec 2011 ($4.6), May 2015 ($230) and Dec 2018 ($3,896). Price continues to rise from these bottoms until ATH around 100x […] Implying a continuing uptrend until $370,000 ATH.” 

Closer investigation of the chart shows a reducing percentage rate of Bitcoin price gains from each successive rally and loose interpretation of the chart shows the current bullish trend maxing out around 1,000%. 

Cointelegraph reached out to PlanB for further clarification of this observation and PlanB explained:

“It could be a sign of a maturing Bitcoin market with reduced volatility. More money is needed to move markets now than it was in 2010-2011. Or, it could just as easily be 100x again, because Bitcoin markets are nonlinear power law distributed with black swans normally occurring [as opposed] to being outliers.”

Bitcoin’s current price action actually appears to be mirroring previous cycles and since bottoming in February, the digital asset has already rallied to the tune of 300%. 

Pre-halving hype could push Bitcoin towards $20,000 

A few weeks ago popular crypto-analyst Filb Filb reached an identical conclusion. He is convinced that despite the current correction, Bitcoin price won’t revisit its 2019 low of $3,120. 

Filb Filb explained that:

“Miners sell into market demand everytime the revenue per Bitcon rises above mining costs and he expects that they will ‘limit selling’ as the pre-halving event approaches to invoke the new halving bubble.” 

Simply put, the basic rules of supply and demand determine Bitcoin price and Filb Filb believes that “what happened in 2018 was miners selling off their Bitcoins at marginal costs.”

“Only the most efficient miners survived, while their inefficient competitors got eliminated,” he added.

Similar to PlanB and Parabolic Trav, Filb Filb agreed that miners are currently holding on to new mined Bitcoins as they await the 2020 halving event. 

If this group of crypto-analysts are correct, then we should begin to see miners selling fewer coins as Bitcoin price gains in the near future. Selling will then resume as buying pressure decreases. 

As for the future of Bitcoin’s price, this trio of analysts see BTC/USD following the general trajectory of short-term consolidation followed by pre-halving hype leading Bitcoin back to $20,000. 

12 Month Forecast by FilbFilb

12 Month Forecast by Filb Filb

In the event that Bitcoin does test its all-time high price, it’s entirely possible that long-term holders who purchased BTC near its ATH peak around $16,000 could exit their positions and produce a selloff. 

Of course, all of this is dependent on the digital asset’s technical setup as it approaches these highs. From a technical standpoint, the most likely scenario could involve continued decline until $7,500. This would be followed by a lengthy period of consolidation as reaccumulation takes place and Bitcoin’s daily price fluctuations tighten. 

But as the excitement around the 2020 halving event builds, most analysts expect miners and investors to hold onto their coins. Alongside the predicted influx of retail investors and the debut of institutional investing services from the likes of Bakkt, TD Ameritrade and Fidelity Investments, the stage could be set for a new all-time high.

CoinLaunch Reaches $50,000 Settlement With Ontario Securities Commission

Initial coin offering (ICO) consultant CoinLaunch has agreed to pay $50,000 to the Ontario Securities Commission (OSC), according to documents published on the regulator’s website dated July 24.

According to commercial litigator and former programmer Evan Thomas, CoinLaunch was consulted on two ICOs, BCZERO (raising funds for a Czech off-road truck racing team) and ECOREAL (raising funds for a Portuguese resort), both of which were found to be securities. CoinLaunch reportedly created the tokens, white papers and websites, advised on the sale structure and made introductions, including to crypto exchanges for listings.

According to Thomas, the OSC found that the service was an act in furtherance of the trade of the security tokens since it was instrumental to the solicitation of investors. The consultant agreed to pay a $50,000 fine under a settlement.

The regulator reportedly noted that the penalty imposed was modest but appropriate since CoinLaunch was not aware of the registration requirements, cooperated with the regulator and took remedial steps. Notably, Thomas noted that the startup deleted the private keys granting access to the tokens it received as compensation. He also commented:

“Although regulators cracking down on ICOs have tended to focus on issuers, the big lesson here is that securities laws can apply to activities beyond issuing tokens, including activities that don’t involve buying or selling tokens.”

As Cointelegraph reported in June, the United States Securities and Exchange Commission sued Canadian startup Kik for an unregistered $100 million token offering.

Bitcoin Price Crashes $800 in Minutes as Bears Eye $9K Support Next

Bitcoin (BTC) price dropped $800 in 15 minutes July 27 after a dramatic bearish move destroyed support at $10,000. 

Bitcoin 24-hour price chart. Courtesy of Coin360

Bitcoin traders eat their wallets

Traders were scratching their heads on social media Saturday in the wake of the sudden losses, with BTC/USD crashing from $10,180 to $9,410.

At press time, the pair had recovered marginally to circle $9,500, while a lack of obvious factors left commentators struggling to understand the market. 

As Cointelegraph reported, a return to $10,000 earlier came as a surprise after a similar uptick occurred in a matter of minutes. 

Previously, regular commentator Josh Rager had eyed a break below $9,600 as a gateway to lower levels, with the potential for $9,000 to also fall.

Some had anticipated volatility continuing in the short term. On Twitter, the trader known as CryptoCohen sounded the alarm hours before the $800 losses.

“Could be a larger correction in play — could take a lot longer too — longer than many would expect/hope. But good things come to those who wait,” he summarized.

Bitcoin’s move meanwhile had a more predictable effect on altcoin markets, with tokens in the top twenty cryptocurrencies by market cap shedding up to 4.5%. 

Monthly, Bitcoin price has lost 20%, Cointelegraph noting that end-of-year and longer-term price forecasts remain bullish.

Keep track of top crypto markets in real time here

Bank of China’s New Infographic Shows Why Bitcoin Price Is Going Up

The Chinese central bank released on its website an infographic illustrating what is Bitcoin (BTC), how it works and why it’s valuable on July 26.

A brief story: from Bitcoin to Libra

The infographic illustrates the story of Bitcoin, starting with the publication of its whitepaper in 2008, the mining of the first 50 BTC in 2009, 10,000 BTC having been spent for pizza in 2010, and other major milestones for the system, ending with the announcement of Facebook’s Libra.

“Yesterday the Bank of China posted up an article about Bitcoin,” commented Blockstream CSO, Samson Mow. “They explained how BTC works, why the price is going up, and why it’s valuable. Never thought I’d see that happen. #Bullish”

The factors behind Bitcoin’s rise

Another part of the infographic is dedicated to explaining why Bitcoin’s value is increasing, and it cites limited supply, increased mining difficulty, that it is used as a medium of exchange and anti-inflation safe haven. 

This is in line with the remarks recently made by Morgan Creek Digital Assets co-founder Anthony Pompliano, who said that the European Central Bank’s expected dovish turn will provide “rocket fuel” for Bitcoin.

Furthermore, the infographic does also mention the infamous Mt. Gox hack, the risk of speculation, and stories of lost funds. According to the image, Bitcoin’s main use case is international settlements since its fees are low compared to legacy system while transactions are faster.

As Cointelegraph reported yesterday, the CEO of Chinese tech giant Huawei thinks that China can compete with Facebook for market share by issuing its own digital currency.

Earlier this month, Chinese media reported that China’s central bank is developing its own digital currency in response to Facebook’s Libra as the latter could purportedly pose a risk to the country’s financial system.

Report: Bill Miller Hedge Fund Surges 46% Thanks to Bitcoin, Amazon

The hedge fund of famous investor Bill Miller saw 46% growth in the first half of 2019, reportedly in some part from investing in Bitcoin (BTC).

Citing an investor document, Bloomberg reports on July 26 that Miller achieved such outstanding results by investing in Bitcoin among other high-performing stocks. Alongside Bitcoin, other investments in the Miller’s fund reportedly include Amazon, security system firm ADT, as well as Avon Products.

The 69 year-old investor reportedly found success by following a similar investment strategy as he used during his three-decade run at Legg Mason, which envisions investing in securities that trade at a large discount to their intrinsic value.

According to Bloomberg, Miller’s fund has $126 million in assets, while Miller totally oversees $2.3 billion at his Baltimore-based firm. Additionally, the fund’s monthly performance has seen some volatility, having surged about 39% in June after dropping 29% the month before.

Bitcoin has no obvious correlation to traditional markets, says Miller

Earlier this year, Miller claimed that Bitcoin can potentially have a high value or be worth nothing, considering the biggest cryptocurrency a curious technological experiment. At the time, Miller said that he is not a Bitcoin believer, but rather an observer, adding that he included crypto in his portfolio because there is no obvious correlation between crypto markets and the stock market.

Yesterday, Galaxy Digital CEO Mike Novogratz predicted that institutional interest would push the Bitcoin price back to its all-time highs of $20,000 before the end of 2019.

MIT Fellow and NYU Math Professor Says Libra Copied Off Co-Authored Paper

Alexander Lipton, a connection science fellow at the Massachusetts Institute of Technology (MIT) and adjunct professor of mathematics at New York University (NYU), has claimed that Libra’s white paper copied concepts for a coin proposed in his academic work

Lipton co-authored the paper “Digital trade coin: towards a more stable digital currency” in 2018. In a July 26 interview with CoinDesk, Lipton said:

“Without being particularly obnoxious, I can tell you that the actual structure of Libra is pretty much lifted verbatim from the paper which Sandy Pentland and Thomas Hardjono and I published last year.” 

Additionally, Lipton noted that this work was “not mentioned in the Libra document at all,” and that some of the same ideas were presented in an earlier version of the paper with Pentland, which received the cover spot for an issue of Scientific American.

While the structure of the paper may be the same, some details of implementation are not. Lipton mentions that the paper’s proposed “Tradecoin” (DTC) would likely be backed by traditional commodities. The authors wrote:

“For instance, depending on their resources and abilities, sponsors can contribute oil, gold, base metals and agricultural commodities. Given that storage of significant amounts of the above is difficult and costly, it is natural to use collateral, which is in storage already, thus making stored commodities economically productive.”

In his recent interview, Lipton confirmed that the way Facebook is backing their virtual currency is not what the authors had in mind for their proposal: “we were thinking about raw material producers, supra-national organizations, and, possibly, a couple of large-scale payment providers, but certainly not the likes of Uber.” 

Monetary theory and issues with Libra

While Libra has billed itself as offering financial inclusion for people around the world, in its white paper as well as in one of the recent Libra hearings, Lipton cautioned that Libra’s design could cause massive inflation in developing countries:

“In developing countries, it will cause enormous inflation because the amount of money will be kind of doubled, roughly speaking, in fact much more than doubled. […] I am not a big fan of quantity theory of money, but I am absolutely certain that as the amount of money explodes, prices will go up.”

More copied ideas?

On June 22, Ethereum World News also reported that the decentralized public network project Hedera Hashgraph also claim that Libra copied ideas from them, specifically the Libra Association’s governance model.

As previously reported by Cointelegraph, research by the Wall Street Journal near the tail-end of 2018 indicated that hundreds of initial coin offering white papers — roughly 16% — were flagged for possible fraudulent activity, improbable returns and plagiarism.