Capital Trading Group Blog
CryptoCorner (Mar 13)
Hey CryptoCorner fans, as we were suggesting last week, we were contemplating adding a new coin to our mix and even to our CC Index. Well that new coin is none other than NEO. We highlighted NEO in a few letters last year as a potential game breaker and its meteoric rise over the last few months seems to be solidifying that assumption. For those that don’t know what NEO is or does here is a brief overview from coincentral:
The NEO system includes:
Delegated Byzantine Fault Tolerance (DBFT) algorithm – This is a consensus mechanism (instead of the traditional proof of work/stake) that allows the system to resist the Byzantine Generals problem and maintains consensus even if some nodes bare malicious intentions
NeoX – This system will create the ability to execute and operate across various Blockchains
NEO Contract – Is the mechanism for creating smart contracts seamlessly in scalable, high performance environments that integrates pre-existing codebases
NeoFS – This is a service which allows decentralized storage (like a peer to peer Dropbox)
NeoQ – A lattice-based cryptographic mechanism which creates problems that cannot be solved by quantum computers and ensuring being quantum-proof
We have read that NEO is the Ethereum killer and from what we know about competitiveness, this is shaping up to be a China vs Russia battle, but we live in a borderless world so lest not be cynical. Anyway, we felt it was time to give NEO some highlight and we added it to our weekly following and our CC Index.
For those interested in a really good backdrop on NEO, I will attach a link Here to an article on from Aaron Mangal. This article does a very good job in explaining NEO and one comment we really liked was this one, “NEO is positioned as a “public cloud” and is part of a much bigger strategy by the Chinese government in establishing pre-eminence as a Blockchain platform industry leader.” So, when you hear of all the governmental regulations and negative comments from political bodies, you can bet there are always two sides to the argument. What is clear to us, is that you can never trust what a government says, but rather trust in what actions they decidedly take. All too often it seems our leaders tend to tell us one thing and then do something completely different, thus the life of a politician right?
With the addition of NEO here is how the Crypto’s settled for the week ending Friday March 2nd:
Monero had the best run of the week adding nearly 23% to close at $344.98, if you want anonymity Monero is it. Bitcoin had a good run up nearly 10% to close at $11,123.50. And as you can see our newest edition NEO has had a really good run over the last 2 months as its up 76% ytd at a closing price of $124.71.
There continues to be this global regulatory and legislative battle going on, one in which we know will rage for quite some time, especially given the major disruptive powers that blockchain and cryptocurrencies will have on traditional ways of operating and doing business. We want to highlight the tireless work of people like Caitlin Long, who continue to push the envelope in blockchain and crypto adoption and adherence. She along with a cohort of blockchain advocates descended onto Wyoming to educate the politicians there in hopes of making positive strides toward favorable rulings in the space. Through their collective efforts, the state of Wyoming has made some great strides in being the go to state for Blockchain and Crypto regulatory adoption. An article that Caitlin coauthored summed up the advances, “On February 19, Wyoming's House of Representatives became the world's first elected body to exempt certain blockchain-based tokens from money transmission and securities laws, provided they have a clearly defined "utility" and are not marketed as investments.” This type of legislation will go a long way in paving the way for the blockchain ecosystem to grow and perpetuate. It is in this type of progressive thought leadership that innovation can flourish and not be constricted and disregarded. We always applaud Ms. Long’s achievements, as she is no doubt an industry leader.
As of this writing HB70 is awaiting final Senate vote this week. We look forward to all the bills passing by the great state of Wyoming! A link to the “Open blockchain tokens exemptions bill,” Wyoming HB70 can be found Here.
Other news out this week:
Bloomberg reported that, Boston-based Wellington Management Co. with $1 trillion AUM is considering adding cryptocurrencies to some of its portfolios, according to a February report from one of its equity analysts.
In an interview with Barron’s, Former FDIC chair Sheila Bair gave an endorsement of Bitcoin, somewhat, “Don't put any money into bitcoin that you can't afford to lose. But I don't think we should ban it - the green bills in your pocket don't have an intrinsic value, either. The value is based on what others think is its value. That's true of any currency. Regulation should be focused on good disclosure, education, warding off fraud, and making sure it is not used for illicit activities. Let the market figure out what it's worth. That is what it is doing now.”
Cointelegraph reported this week that the German Federal Ministry of Finances considers Bitcoin as tax-exempt so long as it is used as a means of payment. The court went on to say that “So- called virtual currencies (cryptocurrencies such as Bitcoin) are considered equal to the legal means of payment, as long as these so-called virtual currencies have been accepted as alternative and contractual means of payment by the parties involved in the transaction and have no other purpose than being used as a means of payment.”
According to CNBC The U.S. Securities and Exchange Commission (SEC) has subpoenaed 80 cryptocurrency companies, including the $100 million cryptofund of TechCrunch founder Michael Arrington. Been hearing a lot more chatter of the SEC cracking down and issuing subpoenas for ICOs and they have contacted Overstock subsidiary tZero for cooperation, or probably general counsel to merely understand what the hell is going on.
We have also been reading how the big banks are taking the blockchain and crypto space a whole lot more serious lately, gee a bit late to the party aye boys. JPM is concerned about payment processing, BofA stating it will be harder to trace financial flows and even the smaller banks are becoming worried they might lose customers due to this new asset class.
Ok so let’s look at our new CryptoCorner Index with the inclusion of NEO this week. The index closed at $4332.82 up $355.32 +8.9% on the heels of a good Bitcoin and overall crypto performance:
When we look at the top 5 Bitcoin wallets we can see that the new top wallet is 3D20et- with 181045 BTC which added 19154 on the week:
Let’s get to the technical charts, Bitcoin continues to trade within the $9800/$11700 band with trend line resistance broken at $11034 and a bearish tone as long as it is below. Initial support @ $10550 backed up by Fib support at $9591:
Litecoin is pegged near $200:
Our newest add NEO broke below $105 support and is not bullish till $108 is regained and closed above:
Monero continues to advance:
In conclusion we hope you enjoyed this week’s CryptoCorner, we look forward to continuing the ever expanding blockchain and cryptocurrency world. We strive to not waste your time and rather point out things that we deem important in the continually evolving space and we hope that point stands out. We understand the plethora of updates that exist and we are glad you have chosen to stick with us. Please forward this to your family, your friends and have them sign up for the letter and please go read our other global macro letter that is updated each week at our blog www.econemotions.com and don’t forget to hit the subscribe button! Cheers!
Finally, we will decidedly end our notes with our reaffirmation of the growing need for alternative strategies. We would like to think that our alternative view on markets is consistent with our preference for alternative risk and alpha driven strategies. Alternatives offer the investor a unique opportunity at non correlated returns and overall risk diversification. We believe combining traditional strategies with an alternative solution gives an investor a well-rounded approach to managing their long term portfolio. With the growing concentration of risk involved in passive index funds, with newly created artificial intelligence led investing and overall market illiquidity in times of market stress, alternatives can offset some of these risks.
It is our goal to keep you abreast of all the growing market risks as well as keep you aligned with potential alternative strategies to combat such risks. We hope you stay the course with us, ask more questions and become accustomed to looking at the markets from the same scope we do. Feel free to point out any inconsistencies, any questions that relate to the topics we talk about or even suggest certain markets that you may want more color upon.
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