Alex Morris

FSB Claims Cryptocurrencies Do Not Threaten Global Financial System But Calls For Vigilant Monitoring

FSB claims there should be a cautious approach to dealing with crypto
FSB Claims Cryptocurrencies Do Not Threaten Global Financial System But Calls For Vigilant Monitoring
Contents

The Financial Stability Board (FSB) claims that digital assets are not going to disrupt the global financial market, according to Reuters. However, it also claims that there is a need to take a harder look at these assets for investor protection.

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Small market capitalization

Despite the fact that digital assets have been on everyone’s lips after the December peak, the scope of the cryptocurrency industry remains rather small compared to other financial markets. As an aftermath of the prolonging bearish trend, the total market capitalization has dwindled to just $217 bln (to put this into perspective, that represents less than three percent of the global value of gold).

Not suitable for payments

The FSB report points out that cryptocurrencies are not suitable to be a mundane payment solution due to their low liquidity and constant price fluctuations. Hence, they lack major attributes of sovereign currencies.

However, as U.Today reported earlier, Bitcoin price volatility has recently reached its lowest level in two years, and that prompted speculations either the flagship currency is becoming boring for investors or the market is simply maturing.

Beyond the disruption of financial stability

In its recent press release, FSB notes that cryptocurrencies do not threaten financial stability. Still, as mentioned above, the rapid growth of this market requires “vigilant monitoring” because of possible risks that include exposure of financial institutions and wider cryptocurrency adoption that would result in using digital assets as a means of payment.

FSB also claims that the rise of digital assets prompts the need for investor protection and ALM regulations. Cryptocurrencies still remain in a legal grey zone, so this market is prone to manipulations. The report also touches upon the issue of funding terrorism, implying that cryptocurrencies perform the role of a facilitator. Meanwhile, one study shows Bitcoin is not popular with extremist groups who still choose cash over crypto.

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Crypto Gags Heewon Jang

QUIZ: Which Crypto Best Fits You According To Your Football Preferences?

Crypto Gags
Still Thinking Which Crypto To Buy? Let This Quiz Help You
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Eduard Ezhov

How to Claim GAS on NEO: Guide How to Earn Free GAS

The concept of GAS allows NEO users to earn a good passive income just by keeping their coins. Here are several ways to get free GAS
How to Claim GAS on NEO: Guide How to Earn Free GAS
Contents

NEO is a Chinese Blockchain platform released in 2014. It was designed as a scalable and stable decentralized network for smart contracts and development. The main feature of NEO is decentralized applications, which can be made on different programming languages, including Javascript, C#, Python, Java, and Go. The core of NEO is written on C#.

An interesting fact about NEO is that the platform still works in China, where almost all cryptocurrencies and exchanges are forbidden. The Chinese government does not approve independent Blockchain technologies. That is why NEO cannot provide anonymous transactions. The team of developers is doing their best to comply with the Chinese jurisdiction, and this makes sense because China is a huge, not available for most competitors market.

NEO and Ethereum: what do they have in common?

As for technology, NEO is very similar to Ethereum. Both networks have smart contracts and decentralized apps as their main features. Ethereum was released in 2013, a year earlier than NEO. That is why many independent experts and journalists call NEO a Chinese clone of Ethereum.

However, it did not stop the NEO’s fast rise. It paid off a hundred times for the first investors. The price grew from less than $1 to $160 in 2017. Unfortunately, now it is only $16 because of a total reduction of the market.

image

One more thing that Neo and Ethereum have in common is a special accessory coin for implementing transactions. In both platforms, it is called GAS.

What is the purpose of GAS?

A counting power of any network is restricted. It is not rational to provide free transactions in decentralized platforms as it will not bring any revenue. Every transaction must be paid for.

What is a transaction in NEO? Obviously, there are regular transactions which imply just sending money from one user to another. Things are getting more complicated when we are talking about decentralized apps.

DApps are literally bunches of code that any user can request. They are stored in Blockchain, and every time when the user requests it, the data is transmitted as a regular transaction.

The more complicated program the user requests, the more code has to be transmitted. Actually, anyone can design their own application and call it every time they need. Therefore, some issues have appeared.

If transactions were free, users would not think about rationality in their apps. For instance, someone could waste the network power just by writing such a code (it is pseudocode):

image

If you are not familiar with programming at all, just believe that this code has no end and the program can be stopped only by special platform restrictions.

In order to prevent such situations, every line of code you call should be paid for. It is not a big price, but it is necessary to make users design both powerful and rational code. The currency used for transactions is called NEO. The currency used to pay for transactions is called GAS.

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How is GAS produced?

The algorithm for producing GAS is very simple. NEO tokens generate a certain number of the GAS coins depending on how many of them there are in the wallet. It is actually another way of mining. Here your success depends on the number of coins you keep, not on the computing power you have.

To put it simply, the more NEO tokens you keep in your wallet, the more GAS you will get as a reward. The method is based on Proof-of-Stake technology implemented in NEO for verifying transactions.

The amount of GAS is restricted as well as the number of NEO tokens. In 2018, the total GAS supply is about 17 mln coins. The maximum supply is fixed and comprises 100 mln coins. According to NEO documentations, the limit will be reached in the next 22 years.

How to claim free GAS?

Finally, the main part of the article. How can we get free GAS? Actually, as it has been said before, GAS is always free because it is generated automatically. So, the question is where should you keep NEO to get a passive income? Well, there are three most perspective ways below.

Exchanges

image

Some of the crypto exchanges allow their users to get GAS by keeping NEO. This is obviously the simplest way of earning GAS because it is quite easy to make an account on the exchange, and most importantly, it is free.

Talking about the disadvantages of this option, it should be mentioned that this is the most unsafe way of keeping coins. Exchanges are often being hacked, and even large platforms cannot ensure the 100% safety. The chance to be hacked is not that high to worry about it and rule out exchanges at all, but it is still there. I mention this because other methods in our top are 100% safe.

In 2018, you can claim GAS if you keep NEO on Binance or Kucoin. As it has been already mentioned, GAS is produced automatically from NEO tokens. So, what happens if the user decides to choose another exchange for keeping NEO? The answer is simple — other exchanges just keep your GAS rewards by themselves.

NEON wallet

image

The NEON wallet is a local wallet allowing users to keep NEO on their computers. It is the safest way of dealing with cryptocurrency because the user has an access to their private keys, so no one can steal it. At least, until you do not lose your computer.

There are many different local wallets which support NEO, but the NEON wallet boasts three killer features:

  • It is stable and safe.

  • It is free.

  • It allows users to get their GAS reward.

You can download the NEON wallet on GitHub. After installation, you will just need to send NEO tokens to the new address. Once the transaction is finished, you will start getting GAS automatically.

Ledger Nano S

image

Another 100% safe method of storing cryptocurrency is a physical hardware. The Ledger Nano S is one of the most popular models. It is much easier in usage than it seems.

Actually, the Ledger Nano S is a kind of minicomputer, but it has only one function — storing cryptocurrency. If you are not familiar with physical crypto-wallets, here are some instructions how to make it work.

It is important to note that the Ledger Nano S is just a hardware. You will also need to set up a local wallet to which the coins will be sent. I put exactly the Ledger Nano S in our top because it supports the NEON wallet.

In order to set up the wallet, you should install the Ledger Live software. It allows you to manage your devices and make transactions while all the data is stored in a physical wallet. After sending coins to the wallet, GAS will also start being produced automatically.

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🕵️‍ ICO Watch Eric Eissler

Status, a Community Project That Raised over $100 mln: Past ICO Review

👁 ICO Watch
Blockchain OS is on its way. Are you ready for the next level of computing?
Status, a Community Project That Raised over $100 mln: Past ICO Review
Contents

Status OS  is a lite client of Ethereum. It is a small operating system that has encrypted services such as web browsing, chat, and payments - in Ether only.

The ICO raised $102 mln during a one day only sale on June 14, 2017. The entry price per token was $0.0366 and it is now trading at $0.95273.

The platform is based on the Ethereum Blockchain. This means that users can design their apps via smart contracts. Status is thus also connected to the Ethereum peer-to-peer network and can exchange data via the decentralized network.

Status’s Light Client offers a good opportunity for many users to work with the Ethereum Blockchain without having to download it completely.

The Status platform sees itself as a community project that functions via an open source system. Anyone who wants to participate can work on the platform. This ensures that users ensure the network design. Interestingly, Status sees itself as a new form of social media platform.

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Seven dapps and more to come

That sounds like a lot of functions, so what can Status do for me?

There are seven dapps on Status so far, with more to come in the future. First, it is possible to receive, send and save Ethereum or other cryptocurrencies. Status has an eWallet built into the dapp so you can use it for payments, sending or receiving money.

Also, users can also trade in Ether or use it as a means of payment in shops, provided that that store will accept payment in ETH.

The app provides the service to use its own encrypted and mobile identity to make digital interactions more secure. When you visit the site, you can download many different dapps which are all associated with Status and can be used within the Status OS app.

Messaging, payments, smart contracts and more

Additionally, there is an encrypted messenger, such as telegram, which can be used to send or receive Ether, complete Smart-Contracts and simply chat with friends.

In regards to payments, the Status Hardwallet is a particularly innovative solution as currently no other hardware wallet or mobile wallet in the industry supports transaction settlement through NFC.

Since the wallet will be compatible with all major cryptocurrencies including Bitcoin, Ether, and ERC20 tokens, users outside of the Status network will be able to use the Status Hardwallet to store and transact using other cryptocurrencies.

Seven dapps within the OS:

uPort

Declare digital independence. uPort is a self-sovereign identity system.

Gnosis

Crowd sourced wisdom. Make complex predictions on the go with an easy to use prediction market.

Oasis Exchange

Enjoy a near-instant decentralized digital asset exchange between ETH and ERC20 tokens.

Ethlance

The decentralized jobs marketplace. Hire or work for cryptocurrency, with no fees.

Aragon

Create unstoppable companies and organizations, and value without borders.

Etherisc

A decentralized insurance platform. Buy a policy on the go, and be paid claims automatically.

Ujo

Ujo is a home for artists. Create and control your creative content, and share it with the world.

The low down

This is a new take on the traditional OS for sure, but what we won’t know is how it will be received when it launches. When it comes to any product or service, it is the metrics and the number of units sold that matter to the market and to, most importantly, the investors. While the token is not worth much, it does not mean that the company is not worth anything. Until then, investors and users alike are awaiting the release of the software. Only after that point will Status be able to prove its status.

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🎤 Interviews Alexander Goborov

Crypto Prices Can Be Predicted, Says Science

🎤 Interviews
Research shows that Reddit can predict crypto rates
Crypto Prices Can Be Predicted, Says Science
Contents

UCL stands for University College London, a highly regarded institution with a long history of academic excellence. Located in the UK’s capital, this university is considered to be one of the finest research facilities in the world; among its alumni are such household names as Mahatma Gandhi (Indian politician), Alexander Bell (inventor of the telephone), and Francis Crick (one of the discoverers of the DNA).

Last week, we published an article about social media and its effect on crypto prices, in which we briefly examined a scientific study titled “Cryptocurrency price drivers: Wavelet coherence analysis revisited” which had recently came out of UCL. Today, we welcome Ross Phillips, one of the authors of that study, for an exclusive interview.

Behind the study

UCL

U.Today: Both yourself and your colleague Denise Gorse work for Financial Computing and Analytics Group at University College London in England. Can you please tell our readers what sort of work you do there?

Ross: While my paper with Denise has focused specifically on cryptocurrency price prediction, UCL’s Financial Computing & Analytics Group has much broader research interests, including prediction and risk modelling in a range of financial markets. Some of the work of the group, including my own work, actually overlaps significantly with the interests of the UCL Centre for Blockchain Technologies (CBT). The CBT is an interdisciplinary research group which brings together researchers from eight separate UCL departments, whose work falls into three categories: science and technology, economics and finance, and regulation and law.

More specifically, the work that Denise and I do, which includes the paper you covered, has focused on investigating whether online indicators, especially those relating to social media activity, can be predictive of cryptocurrency price movements.

We have explored this hypothesis through a number of separate but related experiments, including:

  1. analysis of correlations between indicators, such as relevant posts/new authors on Reddit, and prices over different time durations;
  2. repurposing a model originally designed for another field and applying it to relevant social media data to track the formation of bubbles; 
  3. deciphering relationships between the occurrence of particular discussion topics and price movements.

Predictions

Graph

U.Today: What the scientific consensus was, pertaining to crypto rate predictions, prior to the study? What did you expect to prove or disprove?

Ross: Many previous academic studies had shown that online indicators, including social media activity, do exhibit relationships with cryptocurrency prices. However, these occasionally differed on their findings, depending usually on the particular data period analysed. We noticed an interesting study using a technique called wavelet coherence which demonstrated well that certain relationships (roughly, correlations) aren’t always uniform over time–they are, in fact, changing.

We set out to revisit the use of wavelet coherence and extend that study. We wanted to validate that relationships were still present and temporally dependent, i.e coming and going over time, when looking at a larger dataset (multiple cryptocurrencies, indicators, and a larger time period). Also, we wanted to check that relationships involving the new indicators were leading, as opposed to having changes in social media lag the price.

This laid the foundations for the main aim of our paper which was to provide an understanding as to why certain social media and crypto rate relationships were appearing when they were.   

U.Today: Can you please outline your study’s fundamental conclusions in layman’s terms to those who may not be familiar with statistical analysis? What are the possible ramifications of your findings for people involved in the crypto world?

Ross: The main finding was that medium term relationships (8 to 32 days) strengthen between the online indicators considered (Google trends, Reddit data, etc.) and cryptocurrency prices during bubble-like financial regimes. As well as explaining why relationships have been observed at certain past times, this observation also suggests these online indicators could potentially be used in a predictive model for bubbles, which are of obvious interest to those looking to understand and track their changes.

A secondary finding was that sudden spikes in online indicator values have different relationships with the price at different times: sometimes there is a positive relationship (when both the indicator and the price are increasing) and sometimes a negative relationship. An example of that latter would be a hack of a system occurring causing prices to fall but related online activity to rise.

This secondary finding could be useful for those analyzing, trading, and potentially training models based on daily fluctuations of online indicator data: don’t just trade on the spikes, use them to identify the causal event.

Platforms and cryptocurrency

Reddit

U.Today: How and why is Reddit different from other social media platforms as far as crypto rate predictions go? Does it really hold more promise than, say, Twitter for those who trade cryptocurrencies and monitor their prices?

Ross: That’s a great question.  I think every social media platform has its own advantages and disadvantages, especially when for data mining. The following are some of the reasons why we chose Reddit–and why it’s promising–for data mining:

First, one interesting aspect of Reddit is its topic based structure. Different topics have their own ‘subreddit’ (area). This results in distinct but possibly overlapping communities. This division into subreddits indicates user interests clearly and enables potential research on community characteristics, not readily available on other platforms.

Second, Twitter has been reported to have an issue with spam submissions. Whereas humans may be able to determine whether messages are spam, naive algorithms may be misled. Reddit currently has less spam for a couple of reasons: that subreddits are usually actively moderated, and that each submission can be upvoted and downvoted, affecting its visibility. Spam submissions get downvoted and low visibility discourages further spam.

Third, an important consideration for all research is how reproducible the research is. That’s another reason we chose to analyse Reddit data, as complete historical and real-time data can be accessed there for free.

This easy accessibility of information on Reddit could also help those wishing to analyse social media data for their own cryptocurrency trading.

U.Today: Generally speaking, as a computer scientist, do you think cryptocurrency is here to stay and its grasp on the world is only to tighten, or is it merely a financial fad? If you believe the former, what new developments may soon come about?

Ross: I feel that both cryptocurrencies and blockchain technology are definitely here to stay. While prices and trading volumes may have peaked as part of a speculative bubble last December and January, much of that speculation was separate from actual technology progress. Aside from prices and online indicators, there are other important indicators for tracking the health of the ecosystem. For example, developer interest and attendance at developer/technology focused conferences hasn’t stopped increasing, and that is a good indicator that the technology will keep progressing.  

Although I feel the ecosystem is here to stay, I do feel that certain cryptocurrency projects may not be. There are now thousands of cryptocurrencies, and I feel that some projects may not necessarily need their own cryptocurrency, or even blockchain-related solution.  

The current bear market is not only a good opportunity for projects to focus on building their products, but I think the market conditions, all bubble-related euphoria aside, can also allow people to take a step back and work out what is truly needed.

Looking into the future

Crypto

U.Today: Are there any more studies in the pipeline at UCL that may give us more answers? In fact, what is the next big crypto question in the financial science?

Ross: There are so many projects going on right now, especially via the CBT, so it’s hard to keep track of all of them. One of the projects I’m excited to see the results of is UCL’s multiyear partnership with Ripple. In terms of the next big crypto question, I feel any research enabling increased user adoption is especially important, for example exploring the causes of cryptocurrency volatility and ensuring greater stability. Some adopters may be wary of using cryptocurrencies due to the reasonably high current volatility, and national governments would need to find a way to ensure stability before considering central bank involvement with cryptocurrencies.

Thus, I would view research into stablecoins, and research in the wider area of cryptoeconomics, as one of the most important areas of ongoing fintech research.

U.Today: Finally, while all scientists agree that making predictions is very hard indeed, and this endeavor can often backfire, based on the data you’ve got on your hands right now, what possible price fluctuations do you foresee over the next couple of months as this crypto year is about to come to a close?

Ross: You’re right, it’s a hard endeavor to make accurate far-reaching price predictions, and it’s a minefield to answer. What I can say is that cryptocurrency market dynamics have been seen to change frequently. A number of regimes have occurred over a short period of time this year, including bubble, bull market, and bear market states. Identifying trends within the ecosystem and understanding their implications can help predict these regimes, which is the key to foreseeing longer term price changes.

For instance, maybe the boom of the ICO market in 2017 caused the larger cryptocurrencies to more strongly exhibit one of the properties of a currency, i.e. they became a ‘medium of exchange’ allowing access to ICOs. This, with several other causes, contributed to the rising price of Bitcoin and Ethereum.

For me, actual user adoption of the cryptocurrency ecosystem, or even individual projects, is one of the most important longer term impactors from now on.

It’s not just important for those looking to speculate, but also important for the success of the ecosystem. Admittedly, widespread user adoption may not happen over the next few months, but hopefully over the next few years.

🎤 Interviews
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Stavros Georgiadis

Stellar Lumens Is Growing. What’s Next?

The 6th largest cryptocurrency in the world has recently formed an ascending triangle with higher lows and may be poised for a breakout aiming at $0.35 and then $0.38.
Stellar Lumens Is Growing. What’s Next?

Stellar (XLM) Technical Analysis

Stellar is currently in the sixth position in the top one hundred cryptocurrencies by market capitalization, having a market capitalization of $4.808.965.522 and price of $0,253682 as of Nov. 7, 2018. What’s next?

52- week Range: $0.0269 - $0.9199

1-Year Change: 823.44%

Looking for an upward breakout

Looking for an upward breakout

Stellar has recently formed an ascending triangle with higher lows and may be poised for a breakout aiming at $0.35 and then $0.38. The ADX DMI indicator shows a trend that is not very strong with a value of 20.25 for the ADX indicator, but the values of +DI and -DI are 32.92 and 13.35 respectively, showing that the dominant trend on the daily chart is the uptrend.

MACD indicator is also positive and rising, while the current price of $0.2620 is above the daily 20-period and the 50-period exponential moving averages show values at 0.2423 and 0.2383 accordingly. The Momentum indicator shows positive signs as it has formed higher lows and is rising, but the Stochastic indicator with values (14,3,3) is in the overbought zone above the 80 level.

What are the key levels to monitor for support and resistance?

First the daily Pivot Points are as follows:

Name

S3

S2

S1

Pivot Points

R1

R2

R3

Classic

0.23262

0.24049

0.25437

0.26223

0.27611

0.28397

0.29785

A break above the $0.26223 is very close and it may support the price to higher resistance levels. There is support at $0.1733, $0.1827, $0.2049 and $0.2540. There is resistance at $0.2715, $0.3013 and $0.35. Some resistance should be expected as the daily Bollinger Bands are $0.2413 and $0.2176 for the upper and lower band, respectively.

Buy at lower price levels anticipating a breakout

If the breakout is to occur, a good risk-adjusted trade may be buying near the support level of $0.23 and having the price of $0.35 as a first target. There is very strong support at the price near $0.20, so a stop-loss below it would offer a risk-reward ratio of about 1:3, which is considered very attractive.

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