Bitcoin Halving History: Harsh Rate As a Clue to What Will Happen

Bitcoin Halving History: Harsh Rate As a Clue to What Will Happen

With Bitcoin off on an upward rally, many are pointing to the upcoming halving, due on May 12, as the underlying reason. Not unfairly, either. Precedent demonstrates that Bitcoin’s (BTC) price usually ends up higher after a halving, even if it takes several months. The halving was programmed into Bitcoin’s source code from the very beginning as Satoshi Nakamoto specified that there would only ever be 21 million BTC issued. Every 210,000 blocks, the block reward is cut in half. Therefore, at the genesis block in 2009, miners received 50 BTC as a reward. This was reduced to 25 BTC in 2012, and again to 12.5 BTC in 2016. Now, miners will see their rewards cut in half once again. After the first halving, the price rose from $12 in November 2012 to a peak of $1,100 in November 2013. Similarly, the second halving saw a sharp increase 11 months later, rising from around $650 in July 2016 to over $2,500 in May 2017. The most straightforward interpretation of this is that the halving introduces a constraint on supply, driving demand.However, the last halving was in 2016, before the initial coin offering mania, before the evolution of cryptocurrency derivatives, and a long time before the coronavirus started disrupting the global economy. Thus, because Bitcoin’s price is rumored to strongly correlate with the hash rate of the network, can the previous halvings be an indication of what to expect from the next one?Downward pressure on mining profitabilityThe hash rate is an indicator that’s worth watching in the period around a halving. A higher hash rate indicates more computing power in the network — or, in other words, high participation from miners.Hash rates around previous halvings tended to show similar trends to price. For example, in the 2016 halving, the hash rate showed a steeper increase a year later, indicating that more miners were attracted by the increase in Bitcoin’s price. However, from the chart above, it’s evident that there was no significant drop off in the hash rate after the 2016 halving. In fact, the hash rate stayed steady immediately post halving despite the obvious drop in mining profitability. Mining rewards are only one component of overall mining profitability. Transaction fees are another way that miners generate income, and looking…

Bitcoin Hasn’t Done This Since 2015 Before Its 10,000% Bull Run

Bitcoin Hasn’t Done This Since 2015 Before Its 10,000% Bull Run

The price of Bitcoin (BTC), the top-ranked cryptocurrency, currently sits around $9,000, after last week’s impressive 20% rally in a single day.  With the halving now less than 2 weeks away, it might seem like a no brainer to go long on Bitcoin to catch the next explosive move. However, there is one chart view that suggests we may have topped out, and that is what I’ll start with today. Daily crypto market performance. Source: Coin360.comIf in doubt, zoom outBTC USD daily chart. Source: TradingViewIn last week’s analysis, I shared two possible ascending channels, one of which was invalidated leaving one in play. This week, I want to look at the possibility that we were not inside either channel and the fact we could still be in a downtrend since the June 2019 pump that almost hit $14,000. The upper trend line is validated by three touches. However, the lower trendline of this channel puts the immediate downside as low as $3,000 with the moving average around $6,300. These are not numbers that I expect Bitcoin to see again, but it would be foolish to not be prepared for it.The Fib hints at what a breakout could bringBTC USD daily chart. Source: TradingViewThe Fibonacci retracement levels from the ATH of $20K per Bitcoin are showing us that a breakout today could see us return to much higher levels than previously expected. $9,550 is the critical level to focus on. It’s both the 0.382 Fib and the top of the channel.  Claiming this level could see Bitcoin soar towards the 0.5 Fib of $11,50,0 which then realistically puts the 0.618 Fib of $13,500 on the table.   Now that’s all well and good, but “number go up” doesn’t always happen, and one such indicator that can be relied on to confirm the direction we’re headed based on the current momentum is the monthly Moving Average Convergence Divergence indicator or MACD. MACD monthly analysisBTC USD monthly MACD chart Source: TradingViewLast week, I highlighted the significance that the moving average divergence convergence (MACD) Indicator has on the price of Bitcoin when it crosses bullishly on the weekly timeframe. However, with the bullish monthly candle close comes a new picture for the monthly MACD. Mapped out above is the monthly MACD bullish and bearish crosses with the…

Bitmain Recovers, Claims Profits Despite Pandemic and Power Struggle

Bitmain Recovers, Claims Profits Despite Pandemic and Power Struggle

Chinese cryptocurrency hardware manufacturer Bitmain seems to be bouncing back after a streak of dismal reports. Earlier this week, a local industry blog revealed that the mining giant has accumulated over $300 million in revenue so far this year and is rewarding employees with massive bonuses on Labor Day.Bitmain has since confirmed that information to Cointelegraph but ignored additional questions. Therefore, how does a mining company go about scoring profits amid the pandemic and the Bitcoin halving frenzy, the latter of which is said to shake things up for miners? A brief recap of Bitmain’s fluctuationsBitmain was founded in 2013 by Jihan Wu and Micree Zhan. At the time, Wu was a private equity fund manager, while Zhan was raising funds for his TV streaming startup. Wu had allegedly spent all his savings on Bitcoin (BTC) and was looking for a way to accumulate more of the asset through industry-scale mining.In November 2013, Wu and Zhan developed an ASIC chip that allowed to mine BTC at full capacity, thus revolutionizing the industry that had been fully reliant on less-efficient CPU setups. Bitmain’s sales soon skyrocketed (despite some turbulence caused by Mt. Gox) and by mid-2018, the company was valued at $15 billion after reportedly closing a pre-initial public offering funding round. Around the same time, Bitmain announced its plans to expand into the field of artificial intelligence as the Chinese government began applying more pressure to the mining industry. Apparently, it was Zhan’s idea to open up an AI arm, while Wu was not fully supportive of that direction and even reportedly once called Zhan’s plan “crazy” during an internal meeting.As Bitmain began preparing for an IPO, the company hit another rough patch due to the crypto winter that was intensifying at the time. As a result of the collapsed BTC price, Bitmain purportedly sold a substantial amount of its mining equipment at a loss throughout 2018, hoping to secure the majority of the market share for better times. Additional reports suggested that the mining giant introduced austerity measures that included massive layoffs and the suspension of its colossal $500-million blockchain data center and mining facility in Rocksdale, Texas. By January 2020, Bitmain’s market share by hash rate had ostensibly dropped from around 75% to 66%, while an…

Gold Ownership Has Been Difficult, Until the Days of Crypto

Gold Ownership Has Been Difficult, Until the Days of Crypto

Gold’s history as a symbol of value dwarfs that of any other artifact. Used as money in both ancient Greece and the Roman empire, gold was also the preferred method of payment for goods along the Silk Road. When modern banking emerged during the Italian Renaissance, the concept of paper money convertible into gold was invented. This practice ended a half-century ago, but the value of gold remains timeless.Starting with England in 1717, modern nations began anchoring their national systems of money to gold in what became known as the “gold standard.” By the late 1800s, and until World War I, the most advanced economies were united in this approach. Today, although the money of nations is no longer anchored to it in any way, gold has retained considerable economic utility. Whether used to preserve savings or as a hedge against financial instability, gold has been a mainstay in individual, institutional and state portfolios.Gold ownership is challengingIn spite of this storied history and the clear economic utility of a scarce asset, gold ownership remains challenging. Unlike fiat money in bank accounts or financial assets in investment accounts, stores of gold must be physically safeguarded against theft. As these volumes of stored gold increase, incentives for theft also rise, pushing the cost of secure custody higher. Another challenge is transportability. Theft must also be physically guarded against during transit, but eliminating this risk can be prohibitively expensive. Not everyone can afford an armored Brinks truck.More challenges arise at the transactional level where the gold must be both verified for its authenticity and denominated in such quantities as to suit both the buyer and seller. Due to the high costs of purity testing and the difficulties of dividing physical gold, these constraints dramatically lower the potential for voluntary transactions between buyers and sellers. The potential for lower-value transactions suffers the most, as these buyers and sellers typically cannot rely on economies of scale to offset transaction costs. They may also prefer to use smaller and more precise denominations than the antiquated “gold bar.”Together, these challenges create significant friction for both buyers and sellers of physical gold. These hurdles can be especially discouraging for smaller investors who may be dissuaded from ownership of the physical asset altogether. Popular…

Eric Hughes: A Cypherpunk’s Manifesto

Eric Hughes: A Cypherpunk’s Manifesto

Privacy is necessary for an open society in the electronic age. Privacy is not secrecy. A private matter is something one doesn’t want the whole world to know, but a secret matter is something one doesn’t want anybody to know. Privacy is the power to selectively reveal oneself to the world.**The following essay was written by Eric Hughes and published on March 9, 1993. “A Cypherpunk’s Manifesto” was originally published on activism.net and is reprinted here on Bitcoin.com for historical preservation. The opinions expressed in this article are the author’s own. Bitcoin.com is not responsible for or liable for any opinions, content, accuracy or quality within the historical editorial.**If two parties have some sort of dealings, then each has a memory of their interaction. Each party can speak about their own memory of this; how could anyone prevent it? One could pass laws against it, but the freedom of speech, even more than privacy, is fundamental to an open society; we seek not to restrict any speech at all. If many parties speak together in the same forum, each can speak to all the others and aggregate together knowledge about individuals and other parties. The power of electronic communications has enabled such group speech, and it will not go away merely because we might want it to.Since we desire privacy, we must ensure that each party to a transaction have knowledge only of that which is directly necessary for that transaction. Since any information can be spoken of, we must ensure that we reveal as little as possible. In most cases personal identity is not salient. When I purchase a magazine at a store and hand cash to the clerk, there is no need to know who I am. When I ask my electronic mail provider to send and receive messages, my provider need not know to whom I am speaking or what I am saying or what others are saying to me; my provider only need know how to get the message there and how much I owe them in fees. When my identity is revealed by the underlying mechanism of the transaction, I have no privacy. I cannot here selectively reveal myself; I must always reveal myself.Therefore, privacy in an open society requires…

Google Profits off Impersonations of Banned Cryptocurrency Celebs and Companies

Google Profits off Impersonations of Banned Cryptocurrency Celebs and Companies

Cryptocurrency companies are banned on Google but the platform is allowing phishing sites to impersonate them. London-based bitcoin exchange Coin Corner showed that a fraudulent site mimicking it is allowed on Google’s advertising platform though its own evidence-backed appeals of legitimacy to Google Ads have been constantly ignored.Coin Corner marketing manager Molly Spiers says the policy is exposing customers to fraud. “So @GoogleAds won’t allow @CoinCorner – a long-standing, legitimate business – on their platform, but will allow phishing companies? Pay attention @Google!” she tweeted on April 30.Spiers shared a screenshot showing a Google advert that promotes www.coincornerr.com, an apparent phishing site that impersonates the Coin Corner website. The acceptance of the scam site by Google Ads enables it to come up higher on Google Search. She points out:With Google’s stance on #Bitcoin and #cryptocurrency advertising, any adverts that contain crypto-related keywords are going to be automatically disapproved, so it looks like they have copied our text but removed all references to bitcoin in order to get around Google’s algorithms.In 2018, Google banned cryptocurrency ads supposedly to protect users from scams but partially lifted the ban to allow regulated exchanges in the U.S and Japan to advertise. The continuing embargo on crypto companies outside the exempted territories, however, is not serving its purpose as phishing sites are allowed while appeals from regulated companies are disregarded.Coin Corner has been in business for six years and is registered with the British authority, the exchange’s CEO, Danny Scott, commented in Spiers’ thread. The company has contacted Google a number of times to ask for exemption in the UK to no avail.Scott said Coin Corner reported the scam site to Google but it has not been removed from search results. Google has previously continued to run adverts from phishing sites even after they are exposed.In a related episode of policy inconsistency, Google’s sister platform, Youtube, recently took down Ripple CTO David Schwartz’s videos, claiming that they are impersonations. You Tube is currently facing a Ripple lawsuit for not doing enough to protect users from giveaway scams.The Alphabet-owned platforms need to update their policies and technologies to stop promoting fraudulent initiatives while censoring legitimate businesses and exposing consumers to scams.What do you think about Google’s practices? Let us know in…

Bull Flag Breakout Brings Bitcoin Price to $9,200 — Altcoins Follow Suit

Bull Flag Breakout Brings Bitcoin Price to $9,200 — Altcoins Follow Suit

Bitcoin (BTC) price has risen over the $9K mark for the second time in 24-hours. On Saturday the day bulls managed to push the price of the top listed crypto-asset on CoinMarketCap to $9,010 but the price quickly rejected at the top of the bull pennant and pulled back to the $8,800 support before making a successful second attempt at breaking out. Crypto market daily price chart. Source: Coin360The breakout brought the price to $9,200 and at the time of writing Bitcoin price has pulled back to the $9,100 level where traders are attempting to establish support. On the shorter timeframe traders will note that the breakout occurred on a slight spike in volume but purchasing volume has now returned to the levels seen earlier in the day. BTC USDT 4-hour chart. Source: TradingViewA few possibilities could play out over the next few hours: Bitcoin price could consolidate between $9,200 and the bull pennant trendline which is also aligned with a high volume node on the VPVR at $8,900.Another more bullish outcome would entail Bitcoin price pushing through the resistance at $9,200 to exploit a small gap on the VPVR from $9,176-$9,486. A short-term bearish scenario would occur is the price pulled below the 20-MA and $8,685 as the price could then drop to $8,400. At the time of writing, a bullish outcome seem more likely as the MACD and RSI remain bullish on the 1 and 4-hour timeframe. Risk averse traders are likely to wait for a retest of the $8,800 support whereas more aggressive traders could consider buying a breakout above $9,200 and profit taking at $9,400 and $9,700. Bitcoin daily price chart. Source: Coin360A handful of altcoins also rallied higher as Bitcoin rallied above $9,000. Ether (ETH) gained 2.34%, Litecoin (LTC) added 3.24%, Ethereum Classic (ETC) moved up by an impressive 11.59%.According to CoinMarketCap, the overall cryptocurrency market cap now stands at $254.9 billion and Bitcoin’s dominance rate is 65.7%.Keep track of top crypto markets in real time here

Stock-to-Flow Creator Says Bitcoin is ’Not a Toy Anymore’

Stock-to-Flow Creator Says Bitcoin is ’Not a Toy Anymore’

Crypto analyst and Twitter personality, PlanB, recently said Bitcoin is serious business as he recapped the asset’s journey over the last decade. “This thing is not a toy anymore,” PlanB told Peter McCormack in a May 1 podcast episode. “It’s maybe not an asset anymore as well,” he said, adding, “It is going to be much bigger than that.”PlanB created a concept for Bitcoin’s growth compared with its supplyPlanB is known around the crypto space for his stock-to-flow model. The model takes into account Bitcoin’s block reward, or current inflation, and halving events, factoring those into the asset’s price. According to that data, PlanB plotted a few future price targets for Bitcoin, ultimately showing the asset’s potential for a $1 million price tag down the road. PlanB published an updated version of his model in an April 27 blog post, making gold and silver part of the equation, while taking the time component out. Bitcoin started out as a toyReferencing its early beginnings roughly a 11 years ago, PlanB said Bitcoin began its journey as a proof-of-concept, or PoC, for a peer-to-peer digital cash system. “It was kind of a toy,” McCormack said — a description PlanB agreed with.PlanB noted Bitcoin did not even hold a $1 million dollar market cap in its first two years, although the landscape subsequently changed. “Then came the transition,” he said. “It went from a toy, magical internet money, to dollar parity,” he said, describing the credibility Bitcoin gained when it hit $1 per coin. The analyst explained Bitcoin’s price and usage journey over the years, as its identity transitioned from a payment avenue, to a status similar to gold, to its current position as a financial asset. PlanB did mention the possibility of another transition, although he chose not to provide any speculation on what that might include exactly. The analyst and podcast host also dove into a bevy of other points and concepts in the hour-long podcast episode. With Bitcoin’s halving quickly approaching, time will tell how the coin’s status will change in the upcoming days. 

Meltem Demirors: “Bitcoin is not a F*cking Systemic Hedge If You Hold Your Bitcoin at a Financial Institution”

Meltem Demirors: “Bitcoin is not a F*cking Systemic Hedge If You Hold Your Bitcoin at a Financial Institution”

CoinShares’ chief strategy officer Meltem Demirors shared her view on how the latest crisis in the oil market will impact the ever-changing narratives around Bitcoin. Changing narratives According to Demirors, the recent crash in oil prices is a watershed moment which will change forever the narratives in the investment world. As she points out, the COVID-19-induced crisis “has defied all our expectations on what normal is” which is why expecting to go back to the status quo is “preposterous.”“We’re not just seeing a repricing of oil. We are seeing a thinking of the entire energy value chain.” Following this event, Demirors argues that geopolitical interests will increasingly shift from access to energy to the access to “compute and connectivity.” She also discusses China’s efforts  “to win the digital race” as an example of this shift. Turmoil in traditional markets is also changing the concept of risk, which is likely to play in Bitcoin’s favour. “With interest rates at zero, there are really no low-risk, stable, fixed income generating assets anymore”According to Demirors, investors’ interest  is moving increasingly towards high-risk, high-reward assets such as Bitcoin. People’s attitude towards volatility is also changing. As traditionally non-volatile assets showed large price fluctuations, Bitcoin’s volatility doesn’t look abnormal anymore and investors’ attitude will change accordingly. Existential threats Demirors also pointed out that there are still a number of existential threats to Bitcoin. Considering that most Bitcoin holders rely on financial institutions such as exchanges as custodials, their assets can still be frozen or seized by the government. “There are a lot of people who are trying to sell this narrative around Bitcoin as a systemic hedge when in fact, they’re taking their bitcoin and they’re shoving it right back into the financial system, which effectively negates that sort of argument.”To watch the full interview, check it out on our Youtube channel and don’t forget to subscribe! 

Bitcoin Sextortion: Scams Using Email, Videos, Passwords to Extort BTC

Bitcoin Sextortion: Scams Using Email, Videos, Passwords to Extort BTC

Millions of people worldwide have received sextortion scam emails in 2020 asking for bitcoin. These bitcoin sextortion schemes sometimes include recipients’ passwords to make the threat more real. The authorities have advised what to do if you receive a bitcoin sextortion email.Bitcoin Sextortion Scams Proliferate GloballyThe number of people targeted by bitcoin sextortion scams in 2020 has increased rapidly. According to an analysis by British security company Sophos, millions of people recently received sextortion scam emails in the week it analyzed.“In fact, the number was probably more like tens or even hundreds of millions,” Sophos senior threat analyst Paul Ducklin wrote, adding that some people received between two and five different varieties of this scam. He explained, “The scams exploited global botnets on compromised PCs to dispatch millions of spam emails to recipients around the world,” elaborating:Vietnam, Brazil, Argentina, the Republic of Korea, India, Italy, Mexico, Poland, Colombia, and Peru are the top 10 countries where these compromised computers were used to dispatch the spam messages.The cybersecurity firm found that 81% of the millions of sextortion scam messages it analyzed were in English, 10% in Italian, 4% in German, 3.5% in French, and 1.2% in Chinese.The top countries sextortion scam emails come from. Source: SophosWhat Is Sextortion and Examples of Sextortion Emails 2020Sextortion is a widely used form of online blackmail where a cyber scammer threatens to reveal intimate images or videos of someone online — often to their friends, family, work colleagues, or social media lists — unless they pay a ransom quickly. The scammer often asks for payment in cryptocurrency, particularly bitcoin.A sextortion mail scammer may claim to have compromised your computer, or other electronic devices, threatening that your webcams have been recording you watching sexual content. “I know pretty much everything about you. Your entire Facebook contact list, phone contacts along with all the online activity on your computer,” the scammer may write. Another sextortion mail may say: “the last time you went to see porn material on webpages, my spyware was activated inside your personal computer which ended up logging a lovely video footage of your masturbation simply by activating your cam.”Sophos also provided some examples, such as “We made a video of you on a porn site with the screenshots…