ICO Legal Probes Boost Bitcoin

ICO Legal Probes Boost Bitcoin – SEC Subpoenas and Probes Will Drive Bitcoin

As reported in The Wall Street Journal, the SEC has fired off dozens of subpoenas and requests for information from a myriad of tech companies in various stages of ICO offerings.  As Bitcoin holds its ground at $11,000 on a slow march back to $12,000 and beyond it can’t be helped but assert that ICO legal probes boost Bitcoin. That, as much as the fact the US stock markets are now down for the year after a record bull run, makes Bitcoin a more viable investment alternative than ever before.

With the Securities and Exchange Commission launching all of these ICO probes, a black cloud has settled over the Initial Coin Offering world and with good reason.  With hundreds of millions of dollars of investors’ funds gone missing the world over, the existing uncertainty of prior ICO failures and exit scams every sane investor will be running to the comparatively stable world of Bitcoin.  Yes indeed friends and neighbors, ICO legal probes boost Bitcoin ways big and small.

I predict that many ICOs in the making or already on the market will be crushed by the SEC probe.  That’s because the legal expenses of engaging the government with subpoena responses, answers to information requests, etc. can decimate the operating budget of even large, established companies.

ICO Legal Probes Boost Bitcoin

ICOs now under withering SEC scrutiny have one of two possible fates; they’ll be obliterated by the financial and legal obligations an SEC probe entails OR emerge as a shining light in the ICO world as passed scrutiny of the SEC and could raise record amounts of funds.  Investors face enough uncertainty on any given day which is why I hold to the view that ICO Legal Probes Boost Bitcoin in ways presently seen and unseen.  While Bitcoin volume is currently down, Bitcoin prices are steadily going up.   Bitcoin has always been and will always be the big daddy of the cryptocoin world.  Anyone ignoring this fact does so as their own financial peril.

Bitcoin Breaks 11K as Stocks Slump

Bitcoin Breaks 11K as Stocks Slump – The Trump Effect?

Bitcoin Breaks 11K as Stocks Slump – Coincidence or Confidence? Bitcoin has been on the march the past week up nearly 12% and regained ground to over $11,000 today – for the first time in a long time – as all major US stock markets plunged on President Trump’s announcement of crushing tariffs on aluminum and steel.

Bitcoin Breaks 11K as stocks slump must include the facts that Canada and China are absolutely furious by these tariff announcements and with good reason.  Canada and China are making BOAT LOADS of money on their exports as domestic markets in the US continue to be hammered.  Investors have always hated tariff wars which they see as bad news.  Bitcoin investors and Bitcoin miners should see this as great news!

It shouldn’t be considered a coincidence by anyone that Bitcoin breaks 11K as stocks slump seemingly simultaneously.  Bitcoin, not tied to any one government, is independent of any particular market force – such as tariffs  Steel stocks rallied on this news and I feel Bitcoin rallied today for the same reason.  As a Bitcoin miner I am seeing a spike in Bitcoin transactions today which points to more investors buying Bitcoin which would explain the price surge past $11,000.  It’s not a stretch of the imagination to consider stock investors pulling their funds out of stocks (leading to the S&P 500, DJIA and Nasdaq plunge) and putting those funds into Bitcoin.

The wider cryptocoin markets are mixed today with lots of red and green so I don’t see a “sympathy” rise here.  All of the core coins (Litecoin, Ethereum, Bitcoin Cash and Bitcoin) are up quite a lot today while many altcoins are not.  As Bitcoin breaks 11K as stocks slump I interpret this as investors seeing Bitcoin as a safe haven while this new global trade war erupts.

 

 

Cryptocurrency Converges with Dictatorships

Cryptocurrency Converges with Dictatorships – Why We Need to Watch Iran, North Korea, Venezuela and Russia.

Cryptocurrency converges with dictatorships like never before.  We have Venezuela trying to float the Petro — a cryptocoin investment that is dead on arrival.  Then there’s North Korea mining Bitcoin and stealing Bitcoin as they attempt to circumvent the sanctions that are crippling the country.  Putin, the president-for-life dictator of Russia, has recently given his blessing to Bitcoin while paving the way for Russia’s own cryptocoin endeavors.

Let’s breakdown how cryptocurrency converges with dictatorships…

As a cryptocoin expert, Bitcoin miner and avid blogger of crypto I’m happy to share my thoughts, impressions and collected observations from the cryptocurrency community at large. Nobody with any sense is investing in the Petro. Investors of every stripe see no viable return because the prevailing market sentiment sees no value in the Petro. To make matters worse for the Petro, nobody trusts or likes the government of Venezuela. The Petro is dead on arrival. For Americans that’s a VERY good thing because any US citizen crazy enough to invest in the Petro is very likely breaking Federal law in the process.

Russians by and large don’t have extra money to spare on cryptocoin investments beyond a few Rubles here and there. This amounts to pocket change considering 56 rubles makes up one US Dollar. Russia’s abundant, affordable electricity and cool climate makes it a worthy candidate for Bitcoin mining. Putin’s recent approval of Bitcoin and nebulous statements about cryptocoin are a non-issue. Outside of the oligarchs and the minuscule middle-class / upper middle class in Russia, cryptocoin in Russia is a non-issue.

It’s becoming clear that cryptocurrency converges with dictatorships much less and to a far smaller degree than feared.

North Korea is a known bad actor when it comes to Bitcoin, which they see as a plausible path around sanctions. Outside of government activity in mining and hacking, there is no cryptocoin activity of any consequence.

News out of Iran, which should surprise no one, reports the government is trying to squash all cryptocoin activity except the one they may be shilling in the near future. “Dear Iran — Check out what happened to Venzuela’s coin the Petro.”

Cryptocoin Pump and Dump

Cryptocoin Pump and Dump  – Old School Approach in a Brave New World.

“What has been will be again, what has been done will be done again; there is nothing new under the sun.” – King Solomon

It’s amazing in one sense that cryptocoin pump and dump even exists in the modern age.  Cryptocurrency is new but  the pump and dump is far from an innovation; the scheme has been deployed for a century or more to artificially increase the value of an otherwise worthless asset then sell it to unsuspecting suckers to make a fast killing. While illegal in the United States when it comes to regulated securities, it’s thriving in cryptocurrency circles.

Cryptocoin pump and dump works just like its ancestor; the stock pump and dump scheme.  A group of people pick out a worthless shit stock (shitcoin today) and artificially pump its value up through fake news, a stimulated social media stampede scheme and other forms of propaganda leading the public at large to buy into this “hot coin” by leveraging FOMO.  There’s where the pump starts.

The scumbags behind the cryptocoin pump and dump coordinate to drive the price up through their own purchases of the coin in question all well coordinated in a Telegram chat or other means of simultaneous communication.  Once enough suckers get wind of this “hot tip” the coin price skyrockets.  It “moons” and all of the unsuspecting investors are dreaming of their shiny new Lambo.

That’s when the cryptocoin pump and dump goes into dump mode; all of the scumbags dump the coin making insane profits while leaving innocent people broke and confused. Well who wouldn’t be broke and confused after pouring a ton of their money into a cryptocurrency that suddenly tanks -in a matter of minutes – with no rhyme or reason.

cryptocoin pump and dump

The problem has gotten big enough to prompt the CFTC to release their first Pump and-Dump Virtual Currency Customer Protection Advisory statement just a few days ago.

Key points of the CFTC bulletin include:

“Customers should know that these frauds have evolved and are prevalent online. Even experienced investors can become targets of professional fraudsters who are experts at deploying seemingly credible information in an attempt to deceive.”

The advisory even quoted messages from an online chatroom coordinating a pump and dump…

“15 mins left before the pump! Get ready to buy.” “Five minutes till pump, next message will be the coin! Tweet about us and send everyone the link to telegram (sic) for outsiders to see what we are pumping so they can get in on the action too!! lets (sic) take it to the MOON!!!!!”

All told the entire pump and dump scheme above was over and done in less than ten minutes.

The CFTC warns digital currency investors in no uncertain terms:

“Customers should avoid purchasing virtual currency or tokens based on tips shared over social media. The organizers of the scheme will commonly spread rumors and urge immediate buying. Victims will commonly react to the currency’s or token’s rising prices, and not verify the rumors. Then the dump begins. The price falls and victims are left with currency or tokens that are worth much less than what they expected. From beginning to end, these scams can be over in just a few minutes.”

[ Shameless Plug – This is reason enough to use our cryptocoin consulting services. ]

While cryptocoin pump and dump schemes are immoral they are not illegal at this time because cryptocurrency exchanges are not regulated.

You Don’t Need to be a Cryptocoin Pump and Dump Victim.

Here are some key cryptocoin investing tips:

  •   Don’t purchase digital coins or tokens because of a single tip, especially if it comes over social media.
  •   Don’t believe ads or websites that promise quick wealth by investing in certain digital coins or tokens.
  •   Don’t participate in pump-and-dump trades; market manipulation is against the law and many participants end up losing money.
  •   There is no such thing as a guaranteed investment or trading strategy. If someone tells you there is no risk of losing money, RUN!

Should You Buy Used Mining Rigs?

Should You Buy Used Mining Rigs? Yes. Well maybe…. And perhaps no.

The option to buy used mining rigs is a tempting one. With the madness surrounding crypto mining and alt-coins, many people are going to look into building their own mining rigs.  While this isn’t a huge undertaking for those who are quite computer savvy, what about those who aren’t?  Building a mining rig yourself can be quite daunting if you don’t understand the basics of building a computer from the ground up.  This would lead many to look towards eBay and Craigslist to shop for used mining rigs that other miners are trying to sell.  But is it worth it?

Arguments In Favor to Buy Used Mining Rigs

Difficult to Source

Sourcing hardware for a mining rig build can be somewhat difficult.  The main issue that one would encounter in acquiring the hardware for a mining rig is limitations on GPU quantities you can purchase.  Many retailers, such as NewEgg.com, will have a limit of one per customer per purchase.  Getting the bulk of your GPUs may be difficult, so buying a rig with all the parts sourced may be an attractive option to some.

 

Assembly is Complicated

Building a mining rig is also quite an undertaking in and of itself.  It requires more than a working knowledge of assembling a normal desktop PC, as you’ll be required to run PCI-E USB riser cards and possibly need to daisy-chain power supplies in order to get the entire rig up and running.  Buying used mining rigs with all of the assembly, troubleshooting, and OS installation and configuration done for you may be an attractive prospect.

Arguments Against Used Mining Rigs

Buyer Beware

As with any used PC, you can never be fully certain how old all the parts are or how long they will last.  Additionally, people selling their mining rigs are looking to get out of the mining business altogether, so their rigs will be sold as-is.  So a warranty will most often be off the table when dealing in used mining rigs.  Once you drive off with it, it’s yours. When you buy used mining rigs you are taking on no small amount of risk.

Used rigs could also contain dated or aging hardware.  Dated hardware means the GPUs are from previous generations, and thus offer less hashing power.    Aging hardware could mean your used rig won’t mine for a long enough period of time to recoup your investment, much less turn a profit.  A key talking point when speaking with the seller would be to ask how long the rig has been mining.  If it’s been up and running for longer than a year, it’s probably best to not buy it – you’re on borrowed time.  And if the hardware is dated, avoid it altogether.  Dated hardware isn’t able to keep up with the mining difficulty to produce viable hashing power.  This means it will take far longer to recoup your initial investment, if you recoup it at all.

Inflated Pricing

Price is also a major consideration for buying mining rigs.  Due to the nature of cryptocurrency mining, GPU prices are overly inflated, even on the used market.  This was covered more in-depth in my previous article.  This will lead to mining rigs being sold at above retail price for new equipment, as even used GPUs are being sold for more than MSRP.  And you can bet your bottom dollar that any miner looking to get out of the cryptocurrency mining game will look to fully recoup all the money they spent on their rig, so they will sell it for the highest price that people will pay.  Given the hype around crypto mining, this means seeing used mining rigs going for north of $4,000 will be the norm.

The main thing one should always do when looking to buy used is to research the price of the individual components before contacting the seller.  Purchasing etiquette dictates that one should do all their research regarding pricing before they arrange to meet the seller.  This will allow you room to haggle if you know what you’re buying.  Plus, it’s considered rude to meet with a seller and begin research while you’re on their time.

buy used mining rigs

Typical Craigslist Ads for Used Mining Rigs

My Opinion: Should You Buy Used Mining Rigs?

With the main pros and cons laid out, my professional opinion is that it can be reasonable to buy used mining rigs.  If, and I stress IF, you can find a good deal where the sum of the parts is at or below MSRP, it may be worthwhile for you to buy a used rig.  Since the rig will come assembled, you should expect to pay a little extra for that luxury.  How much extra you find reasonable is completely subjective.

Now for my conditions:

  • Condition 1: You must be comfortable replacing parts if/when they go out.  I would highly recommend you only buy a used rig if you have a friend or loved one with the knowledge necessary.  That, or you’ll need to be willing to spend hours pouring over how-to’s and in-depth guides on the web to figure out how to troubleshoot and replace any issues that arise with your rig.
  • Condition 2: One should be able to comfortably absorb the cost of the mining rig if the entire enterprise goes belly-up.  Buying used mining rigs will almost never come with a warranty or guarantee.
  • Condition 3: Understand the hashing power of the rig you’re buying.  It will be essential to understand just how much cryptocurrency you should expect to mine with your rig so you can plan your ROI.  If the rig won’t pay for itself within a year, don’t buy it.

Disclaimer

Given the volatility of the cryptocurrency market and the inherent dangers of investing in cryptocurrency, I must add the following disclaimer: the above article was written as my opinion, and should be taken as such.  We (myself and CryptoCapers.com) are not responsible for any losses incurred by any reader investing in the cryptocurrency market, mining rigs, or ASIC mining equipment, using any advice we have published as guidance in buying used mining rigs or any other mining hardware.  The cryptocurrency market is extremely risky and volatile, and our advice should only be used as part of one’s research into any crypto mining or investing.  If you are in doubt, or if high risk isn’t for you, then don’t pull the trigger.  But if you’re eager to take a risk in hopes of making real money in the future, then by all means, join us and the rest of the crypto pioneers and invest in mining your own cryptocurrency.

Bitcoin Miner Pricing Puzzle

Bitcoin Miner Pricing Puzzle – Bitmain’s Antminer S9 Goes Down in Price as Canaan’s Avalon Miners Go Up.  What’s Going On?

The Bitcoin miner pricing puzzle is getting harder and harder to solve.  Two months ago The Antminer S9 had a “street price” of $5,000 (rated at 14 TH/s) compared to the Avalon 741 (7.1 TH/s) which could be purchased for $799.  Dollar for dollar, the Avalon miner was by far the better deal.  Fast forward to present day and Bitcoin miner pricing has gone sideways.

Canaan’s ASIC Bitcoin miners were always known to be of high quality with respectable performance at fair prices.  The fair prices thing has gone out the window with the Avalon 821 which cannot be purchased for less than $2899 despite a performance increase of roughly 35%  So why is the price more than three times higher when the performance increase itself is not hardly in step with the price increase? The Bitcoin miner pricing puzzle thickens.

By comparison, Bitmain’s flagship product can now be purchased after-retail for nearly half of what they were going for back in December.  Part of the reason for the radical change in pricing can be learned in this CNBC article on Bitmain operations.  It seems Canaan has taken a similar approach to pricing judging from what they said when the 821 and 841 were first announced; they would be pricing their new miners in step with the Bitcoin market.

That makes the Bitcoin miner pricing puzzle more complicated — since Bitcoin is well off it’s December high why are Avalon miners nearly the same price as Bitmain miners today? The Avalon 741 was seen as the next best option — balancing price and performance — compared to the Antminer S9.  I talked about this extensively in an earlier article.  With the Avalon 821 at about the same price as the Antminer S9 — with lower output — I predict Canaan will lower pricing to be in step with prevailing market conditions.

Lower Bitcoin Fees

Lower Bitcoin Fees – One of Those Good News/Bad News Things

Lower Bitcoin fees comes as good news for people who use Bitcoin to buy houses, cars and pizzas and all the rest but bad news for Bitcoin miners like me.  That’s because my Bitcoin mining income — excluding changes in Bitcoin market values – is down by 50%.  Bitcoin miners not only mint new Bitcoin but we also validate Bitcoin transactions.  When we have lower Bitcoin fees we make less money.

When it comes to lower Bitcoin fees my loss as a Bitcoin miner is your gain if you’re a Bitcoin investor or consumer.  The average cost of sending a Bitcoin transaction is cheaper than it’s been in about 18 months – from the $20s now down to under $5.  This is just another example that Bitcoin has more than one unpredictable behavioral factor.

Why do we have lower Bitcoin fees? Long story short; there are roughly half as many Bitcoin transactions now as there was just two months ago. In December, there were roughly 400,000 transactions per day. Present day there are only about 200,000, according to data from Blockchain.info.  When transaction volume drops by 50% lower Bitcoin fees naturally follows.

So why are Bitcoin transactions down by half in just two months? Part of it could be attributed to people who were frustrated by high Bitcoin fees which led them to altcoins.  That said there is reason to believe that Bitcoin volume overall – trading volume included – is down after Bitcoin reached an all-time high of nearly $20,000 followed by a plummet that made absolutely everybody in the cryptocoin sector nervous to say the least.

Lower Bitcoin fees help to bring the Bitcoin picture itself into clearer focus.  Bitcoin is maturing and leveling out and all the related factors are falling in line as the granddaddy of cryptocurrency itself comes of age.

Litecoin Hard Fork Rally

Litecoin Hard Fork Rally – Litecoin Doubled in the Past Seven Days Leading up to the Fork.

The Litecoin hard fork rally has Litecoin loyalists jubilant. Litecoin is like the often overlooked younger brother among the major cryptocoins. It is the fifth-largest cryptocurrency by market capitalization, according to CoinMarketCap and is frequently passed over in favor of Bitcoin or Ethereum on the top of the food chain and even more frequently by cryptocoin investors looking to altcoins for quick profitmaking in the cryptocoin markets.

Litecoin is showing gains as high as 10% today after a so-called “hard fork” resulted in the creation of a new cryptocurrency.

The Litecoin hard fork rally started last week – rising 55% in light of the expected hard fork.  has risen 55 percent in the past seven days as a result of a recent rally.

Curiously, Litecoin founder Charlie Lee calls this hard fork a scam.  As he himself no longer holders a single Litecoin we have to wonder at his opinion, the origins of this hard fork and it’s ultimate intentions.  In December, Lee revealed that he had sold all his holdings in Litecoin under a cloud of accusations he was talking up Litecoin on Twitter for personal gain.

The Litecoin hard fork rally ramped up ahead of Sunday’s planned hard fork at block 1,371,111 which led to the creation of Litecoin cash. A hard fork is a radical divergence in the protocol of a blockchain network. Such events result in the creation of a new blockchain, and therefore a new cryptocurrency.   Bitcoin itself went through hard forks last year and the jury is still out as to the ultimate value of hard fork spinoffs like Bitcoin cash.

The Litecoin hard fork rally is understandable; after a hard fork, holders of a cryptocurrency receive one new digital coin for every unit of that cryptocurrency they own.  In one sense, Litecoin holders became instantly richer.

That’s because Litecoin cash was trading at $7.12, according to CoinCodex, and was up 163%.

Litecoin is a mature, proven cryptocoin and I see the Litecoin hard fork rally as the next evolutionary step for Litecoin on its path to find its own way outside the shadow of Bitcoin.  What Litecoin cash might evolve into no one can say at this early stage.