Sky News, a British TV station and mainstream media outlet, reported that investors lost homes as the Bitcoin price crashed. But, the same argument can be applied to the stock market, real estate, and every other major market.

The report claimed that investors put up their homes as collateral to receive loans and invest in Bitcoin. As the price of Bitcoin dropped, their homes were taken away along with their assets.

The report read:

Married men accessed equity through their family homes, and often – whether because they felt they needed to act quickly to make the most money, or because they feared that their investment would be criticised by their spouses – did so without informing their families, only to see the value of their assets evaporate, followed by their homes.

Bad Investment Method, Not Exclusive to Bitcoin

Crypto assets like Bitcoin (BTC) and Ethereum (ETH) are still at their infancy and are a part of an emerging asset class.

In February, Vitalik Buterin, the co-founder of Ethereum, said that cryptocurrencies are a hyper-volatile asset class and it is not an intelligent investment decision to allocate more than an amount that can be lost, as cryptocurrencies could drop near-zero in a short period of time.

“Reminder: cryptocurrencies are still a new and hyper-volatile asset class, and could drop to near-zero at any time. Don’t put in more money than you can afford to lose. If you’re trying to figure out where to store your life savings, traditional assets are still your safest bet,” Buterin said at the time.

bitcoin price vs s&P 500
Bitcoin Price (Blue) vs. S&P 500 (Red) | Year-to-Date Chart

The phrases “the rich get richer” and “money earns money” refer to the ability of the wealthy to hold on to risky assets and survive bear markets without liquidating their assets. On the contrary, investors that invest more than they can afford to lose in a highly volatile asset class but need the money to cover short-term expenses have no other choice but to liquidate their assets and obtain cash.

In the aftermath of the 2008 financial crisis, which affected the economy of the United States throughout the following years, the suicide rate of Europe and the Americas surged. Investors, especially retail or individual investors, who lost money in the stock market found it difficult to deal with anxiety, depression, and high levels of stress acquired from previous recessions.

Wealthy investors that had not cashed out of real estate properties and assets in the stock market throughout 2008, however, recorded no losses because they were able to wait out the bear market.

Don’t Invest More Than an Amount That Can be Lost

Investments in hyper-volatile assets without necessary risk management which publications have focused on when reporting about Bitcoin throughout the 2018 bear market are not exclusive to cryptocurrencies.

Many investors in the stock market and real estate often rack up debt to engage in high-risk investments and deals without proper risk management, which in most cases lead to full-blown bankruptcies.

When investing, especially in emerging asset classes, it is of the utmost importance for investors to weigh the risks involved in the trade and expect to survive a long-lasting bear market if it arrives.

Joseph Lubin, co-founder of major cryptocurrency Ethereum (ETH), declared that he is “calling the cryptobottom of 2018” in a tweet Dec. 21.

According to Lubin, the crypto market’s bottom “is marked by an epic amount of fear, uncertainty, and doubt,” specifically from industry media and social commentators, which he refers to as “our friends in the 4th and crypto-5th estates.”

Continuing in a Twitter thread, the founder of Ethereum blockchain-focused software firm ConsenSys then evidently addressed his firms recently reported major layoffs:

“ConsenSys remains healthy and is engaging in a rebalancing of priorities and activities which started about nine months ago.”

He stated that Consensys continues investing in projects — in its role as a blockchain tech incubator and venture firm — and hiring for internal projects that “remain core to our forward looking-business.”

In the same thread, Lubin complained about “an epic amount of conjecture and preemptive paranoia” concerning “situations journalists and bloggers don’t have real data for, actual insight into, or understanding of.”

Concluding, Lubin reiterated his optimism about the future of ConsenSys and Ethereum, stating:

“The sky is not falling. From my perspective the future looks very bright. […] Peaking [sic] into 2019, if you could see the landscape through my eyes, you’d have to wear shades.”

Reports surfaced this week — citing sources familiar with the matter — that ConsenSys is spinning out startups it previously backed, some of them without financial support. The sources reported that the number of employees to be laid off could be anywhere between 50 and 60 percent of ConsenSys’ 1,200 person workforce.

This past week, Cointelegraph reported that in comparison to more significant job cuts in various industries globally, the current slump in the cryptocurrency markets and ensuring job cuts in associated companies seem relatively benign.

In September, Ethereum’s other co-founder Vitalik Buterin had pointed out that there is no chance that the cryptocurrency and blockchain space will see “1,000-times growth” again.

Sunday, Dec. 23 — all of the top 20 cryptocurrencies are seeing moderate gains, with Bitcoin’s (BTC) price going above $4,000 again, according to CoinMarketCap data.

Market visualization

Market visualization from Coin360

At press time, Bitcoin is up nearly four percent on the day, trading at $4,050. Looking at its weekly chart, the current price is lower than the Friday’s high of almost $4,200; but the cryptocurrency is still trading significantly up from $3,294 — the point at which it started this week.

Bitcoin 7-day price chart

Bitcoin 7-day price chart. Source: CoinMarketCap

Ripple (XRP) — the second largest cryptocurrency by market capitalization — has gained over five percent on the day, trading at $0.374 as of press time.

On the weekly chart, the current price is significantly higher than $0.292, the price at which XRP started the week. However, the current price is slightly lower than the high of $0.389 reached on Wednesday.

Ripple 7-day price chart

Ripple 7-day price chart. Source: CoinMarketCap

Ethereum (ETH) remains the third largest cryptocurrency by market cap, seeing a 15 percent value increase over the last 24 hours. At press time, ETH is trading at $128, having started the day at $111 and hitting an intra-day high of $133.

On the weekly chart, the current price is notably higher than $87, which was the value of ETH on Monday.

Ethereum 7-day chart

Ethereum 7-day chart. Source: CoinMarketCap

Among the top 20 cryptocurrencies, some are reporting more significant growth rates. Namely, NEO has gained 12 percent, and EOS is also up nearly 12 percent. Cardano (ADA), Litecoin (LTC), IOTA and Ethereum Classic (ETC) are all up almost 10 percent.

The combined market capitalization of all cryptocurrencies has surged to over $135 billion at press time. This places the current market cap near its weekly high of over $137 billion, after having started the week at just $104 billion.

As Cointelegraph reported recently, co-founder of Ethereum, Joseph Lubin, declared on Twitter that he is “calling the cryptobottom of 2018.” He further added that from his perspective “the future looks very bright.”

Earlier this week, two United States congressmen introduced a bipartisan bill titled “Token Taxonomy Act,” which proposes to exempt crypto assets from being considered securities.

Crypto exchange Binance has added Circle’s USD-pegged stablecoin USD Coin as a quote asset for several new trading pairs in its combined Stablecoin Market (USDⓈ). The exchange has announced this in an official post published Dec. 14.

USD Coin (USDC), first announced by Goldman Sachs-backed Circle this May, and released in September, is one of a host of new stablecoins notionally pegged 1:1 to a major fiat currency.

This November, Binance, currently the world’s largest crypto exchange by daily trade volume, had rebranded its Tether (USDT) Market as the combined USDⓈ market to allow for the support of more trading pairs with different stablecoins offered as a base pair.

Today’s latest development will add six new trading pairs with USDC as a quote asset: native exchange token Binance Coin (BNB/USDC), Bitcoin (BTC/USDC), Ethereum (ETH/USDC), Ripple (XRP/USDC), EOS (EOS/USDC) and Stellar (XLM/USDC). In addition, Binance is also adding a USDC trading pair with fellow stablecoin Tether.

According to the announcement, the exchange will replace and delist its former USDC/BNB and USDC/BTC trading pairs, which had just been launched mid-November.

Just ahead of Binance, major United States’ cryptocurrency exchange Coinbase had made USDC the first stablecoin available for trade on its platform in October.

With the proliferating issuance of fiat-backed stablecoins, major exchanges have stepped in to list the new coins: both OKEx and Huobi recently opted to list four USD stablecoins at once.

Earlier this week, Binance launched a collection of educational content comprising almost 500 articles in order to provide “unbiased” information about crypto and blockchain, as part of its Binance Academy initiative, which launched this summer.

According to CoinMarketCap, the exchange has seen $464,404,519 in trades over the 24 hours before press time.

Digital asset manager Bitwise has launched two new beta funds for Bitcoin (BTC) and Ethereum (ETH), according to a press release Dec. 5.

The launch of the new products –– both pitched as an opportunity for investors to “capitalize” on the bear market –– aims to provide a “low-cost” and “liquid” means of capturing returns on both high-profile assets, which are currently trading 81 and 92 percent respectively below their all-time highs.

Bitwise CEO Hunter Horsley issued a statement accompanying the launch of the new funds, suggesting that investors now have “a unique opportunity to enter the market at prices many thought we’d never see again.” He continued:

“Though an ETF has not yet been approved, investors and advisors like the fund format because it’s professionally managed and simplifies access to best-in-class custody, trading, reporting, and tax preparation, and allows for the safe capture of events like hard forks and airdrops.”

As per the press release, the funds will not charge premiums, exit fees, impose lockups, nor charge extra expenses “outside the stated management fee.” Investors’ holdings will reportedly be kept in cold storage wallets held by an unnamed “institutional third-party custodian,” and Bitwise says it will provide clients with K-1 tax documents each year.

Matt Hougan, global head of research for Bitwise, has contextualized the launch of the new funds as being driven by “significant inbound demand” spurred by part “positive developments on the horizon.” These, he outlined, include “the forthcoming “launch of the Bakkt bitcoin futures exchange from ICE, the launch of Fidelity Digital Assets, and the continued movement of institutional investors like Yale University and Stanford University into the crypto space.”

As reported this summer, Bitwise has also filed with the U.S. Securities and Exchange Commission(SEC) to launch a regulated multi-cryptocurrency exchange-traded fund (ETF), which has been designed to include ten cryptocurrencies. If approved, the ETF would track the Bitwise HOLD 10 Private Index Fund that was founded last November.

Global private capital platform CapBridge Pte. Ltd. has garnered a license from the Monetary Authority of Singapore (MAS) to operate a security exchange known as 1exchange (also called 1X), which became operational on November 21, 2018. The exchange is designed to organize liquidity for private companies prior to exit events like an M&A (merger and acquisition) or an IPO (initial public offering).

In an interview with Bitcoin Magazine, CEO and founder of CapBridge Johnson Chen said that the process of obtaining the license took nearly two years. Steps included identifying the business case and ensuring IT systems were in place that included proper risk management and strict governance.

“We also had constant dialogue with industry experts in regulations and securities laws, as well as engagement with regulations,” he says.

In addition, CapBridge is working with global blockchain technology firm ConsenSys. Both ventures have announced plans to build a fully compliant, private securities exchange on the public Ethereum blockchain.

Chen says that at first, key features of the exchange will include smart contracts-based permissioning and fiat settlements such as bank transfers. Initially, this will prevent investors from participating with cryptocurrencies, which he says can still be very volatile.

“We aim to build a trustworthy infrastructure, and we have the ability to trade regulated instruments globally with reduced or zero counterparty risk,” he comments.

However, he does say that when the exchange is a little more established and further protocols are in place, it will offer various crypto-based services including the listing and trading of security tokens.

“CapBridge is working alongside ConsenSys to provide an additional layer of security and authentication in the future,” he said. “The deployment of smart contracts may also allow for settlement efficiency while allowing users direct custody of assets.”

CapBridge serves mid-to-late growth companies. The company brings initial opportunities to lead investors, who then utilize their specific industry knowledge to negotiate value-adding investment structures, conduct due diligence and manage their portfolio positions to the desired exits. These opportunities are then given to co-investors under the same terms, who use the data gathered by the lead investors in specific industry fields.

The co-investment process is conducted electronically on the company’s intelligence platform, which seeks to match deals with investors and facilitate deal processes.

1exchange is a regulated private securities exchange that allows investors to buy and sell private securities in a transparent and centralized environment. The platform was built for private operating companies seeking capital or preparing for liquidity events, as well as family-owned businesses planning management changes, and venture-backed companies seeking to monetize the shareholdings of both their customers and employees.

In recent months, officials with the U.S. Securities and Exchange Commission (SEC) and other governing bodies have placed significant pressure on unregulated cryptocurrency exchanges and have kept a stern eye on initial coin offerings (ICOs) to ensure all security-based offerings are appropriately registered.

According to the company’s release, MultiVAC reported achieving 30,784 transactions per second (TPS) using 64 shards. While the total amount of transactions for all shards used exceeded 30K at its peak, a single a shard was claimed to reach 533 TPS.

MultiVAC also claimed in the release that their “all-dimensional sharding expansion solution” could potentially be used for large-scale commercial applications, as well as for crypto mining on low-performance computers.

The term sharding in crypto is most often applied in reference to the Ethereum (ETH) blockchain’s upcoming major upgrades. In May 2018, Ethereum’s co-founder Vitalik Buterin hinted that sharding – or splitting up the workload for transaction between nodes to speed up processing time – would be implemented on Ethereum.

In late October, Buterin revealed the roadmap for Ethereum 2.0, dubbed Serenity, during his keynote speech at the annual Devcon conference. Apart from a transfer to a proof-of-stake algorithm, the Ethereum think tank also confirmed that Serenity would implement sharding.

Earlier in October, Bitcoin (BTC) developer Mark Friedenbach presented a method for Bitcoin scaling that would rely on sharding and reportedly would not require a hard fork. He  claimed the new solution would be able to increase “settlement transaction volume to 3,584 times current levels” and improve censorship resistance.

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Blockchain will “probably take a little longer” to develop than the internet, because it is “much more complicated,” ConsenSys creator Joseph Lubin told German media outlet t3n in an interview, Cointelegraph auf Deutsch reported Nov. 9.

Lubin, who is also the co-founder of Ethereum (ETH), told reporters that blockchain technology is developing in a similar way to the web, citing its exponential growth with “hundreds of projects that are already practical for humans” to date.

Based on blockchain’s use case for decentralized cryptocurrencies, the digital entrepreneur also suggested that distributed ledger technology (DLT) will be able to “permeate society more than the Internet” and enable a decentralized internet, or Web3. Lubin, however, forecast that the adoption of blockchain on a mass scale will take longer than that of the internet:

“[Blockchain projects] will enable people to build more things that will come in handy again. That’s how the web was developed. It will probably take a little longer, because it is much more complicated. Also, because we work on topics such as digital money, Blockchain will permeate society more than the Internet. Everything will be networked in a Web3.”

In the interview, Lubin stressed the fact that ConsenSys – an Ethereum-focused startup incubator and infrastructure development firm – was “born” prior to the release of Ethereum, with the goal of building the tools and infrastructure to enable a decentralized “ecosystem” in which Ethereum could function.

 Lubin also emphasized that the firm is interested in bringing that ecosystem forward rather than “controlling” it:

“We [ConsenSys] do many things, but we are not interested in controlling the ecosystem. We are interested in promoting the ecosystem.”

Addressing the question of the Ethereum ecosystem’s decentralization, Lubin retorted “[d]o you expect it to be fully mature, three years after its creation?”

When asked about how the dynamics of the current internet could be transformed in Web3, Lubin shrugged off a comparison between ConsenSys and major internet giants like Facebook and Google, insteading pointing to “IBM and Microsoft, Accenture and Deloitte” as possible centralizing forces in blockchain.

Lubin also stated that the principle business models of the internet today are contradictory to the nature of blockchain, which “enables a self-determined, sovereign identity.”

Earlier this year, Lubin predicted that the global community is moving towards a world based on “decentralized governance,” supporting the idea that major cryptocurrency Bitcoin (BTC) is likely to remain the world’s “digital gold,” while Ethereum would serve as a “fuel” for decentralized ecosystems.

Reggie Browne, who is a senior managing director of the ETF group at Cantor Fitzgerald, isn’t holding his breath for a bitcoin ETF. Despite the determination of crypto asset managers jumping through hoops to satisfy US regulators, Browne, who earned the nickname as “the Godfather of ETFs” from Forbes for his influence over the $4.7 trillion market, has his doubts, saying it will happen “no time soon.”

Browne addressed what he finds to be slim odds of a bitcoin ETF amid an inability by regulators thus far to craft a regulatory framework by which cryptocurrencies could operate. In the interim, “it’s very difficult for the commission to wrap their heads around a positive approval because there’s no data yet…the markets just aren’t here,” said Browne, who was speaking at the Georgetown University’s Financial Markets Quality Conference held in Washington, D.C. this week, an event at which SEC Chairman Jay Clayton was also present. Browne’s remarks were cited in Business Insider.

Crypto Catch-22

There’s a bit of a catch-22 in the crypto markets, as the arrival of a bitcoin ETF is widely deemed to be a sign of maturity in the nascent market, which just celebrated its 10th anniversary. Meanwhile, the approval of such a product is dependent on regulation that is waiting for a more mature market. The SEC has already declined nine bitcoin ETF applications, and the crypto community has their hopes pinned to a product designed by asset manager VanEck and blockchain startup SolidX.

wall street bitcoin

VanEck Director of Digital Asset Strategies Gabor Gurbacs on Nov. 1 told Fox Business: “I don’t know exactly how close we are but we are the closest we can be,” adding: “It’s very clear to me America wants a bitcoin ETF and we are here to build it.” In the meantime, VanEck is waiting on pins and needles for SEC feedback on its application.

Waiting Game

It isn’t the first time a Wall Street executive has weighed in on the fate of a bitcoin ETF. In recent days Larry Fink, who is at the helm of BlackRock, the world’s largest asset manager boasting $6.3 trillion in assets under management, quashed any expectation that the firm would issue its own bitcoin ETF in the near future. BlackRock, which is one of a trio of asset managers that together control 82% of ETF market share, is on the sidelines until there are signs the crypto market is “legitimate,” which to him requires government backing.

Meanwhile, if the SEC’s motivation for suppressing a bitcoin ETF is, in fact, a lack of data and markets, as the Godfather of ETFs suggests, they are going to have fewer reasons to decline the product once institutional capital makes its way into the crypto space, which is largely expected to coincide with the opening of regulated crypto exchange Bakkt this year.

Google co-founder Sergey Brin and CEO Sundar Pichai have a lot more in common than just their jobs. Both tech billionaires have crypto-savvy young sons who mine ethereum.

Pichai said his 11-year-old son mines ethereum on a home computer that Pichai built himself, according to Business Insider. He made the amusing revelation at the New York Times DealBook conference this week while — ironically — discussing tech addiction and the importance of limiting screen time for children.

“Last week I was at dinner with my son, and I was talking about something about bitcoin and my son clarified what I was talking about was ethereum, which is slightly different,” Pichai recounted. “He’s 11 years old, and he told me he’s mining it.”

When asked if he built a server to help with his son’s crypto mining efforts, Pichai said no, and insisted that his family only has one computer at home.

‘I Had to Explain How Paper Money Works’

Pichai said his son understands a lot more about virtual currencies than he does about fiat currency, so he had to explain how money works in real life.

“I had [to] explain to him how paper money actually works,” Pichai laughed. “I realized he understood ethereum better than how paper money works. I had to talk to him about the banking system, the importance of it. It was a good conversation.”

In July 2018, Google co-founder Sergey Brin revealed that he mines ethereum with his son, as CCN has reported.

“A year or two ago, my son insisted that we needed to get a gaming PC,” Brin said. “I told him, ‘Okay, if we get a gaming PC, we have to mine cryptocurrency. So we set up an ethereum miner on there.”

Brin — whose net worth tops a staggering $47 billion — added that he and his son had made some money on crypto-mining.

“We’ve made a few pennies, a few dollars,” he joked.

Sergey Brin: ‘We Are in a Tech Renaissance’

As CCN reported, Brin has previously credited ethereum mining with playing a central role in the recent computing boom that is driving a “technology renaissance.”

Brin made the revelations in an enthusiastic letter to investors, where he raved: “We are truly in a technology renaissance, an exciting time where we can see applications across nearly every segment of modern society.”

Brin added: “There are several factors at play in this boom of computing. First, of course, is the steady hum of Moore’s Law…The second factor is greater demand, stemming from advanced graphics in gaming and, surprisingly, from the GPU-friendly proof-of-work algorithms found in some of today’s leading cryptocurrencies, such as ethereum.”