Category: Investing

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Crypto News Cryptocurrency Law Europe Investing

Norwegian Government Issues Warning on Cryptocurrencies, Calls For Regulation

Opera building in Oslo
Opera building in Oslo https://unsplash.com/photos/3VCrw7nHH4A

An official statement by Finanstilsynet – the Norwegian entity in charge of financial regulation – has warned consumers to be wary of cryptocurrency investments.

Despite acknowledging the fact that many institutional investors have shown a marked interest in cryptocurrency, Finanstilsynet stated that unlike securities, bonds and other investments, cryptocurrencies are not well regulated within Europe.

Although Norway is not a part of the EU, cooperation between the EU and Norway is very close – and the statement pointed to the EU’s proposed legislation for cryptocurrency that should start providing a general framework for crypto regulation within the EU.

Until such regulations are in place, anyone considering trading in cryptocurrency should think carefully and understand the significant risk that such investments entail. Consumers who want to try this with open eyes should not invest more than they can afford to lose.

Finanstilsynet statement

It’s worth noting that the proposed legislation will not be adopted wholesale, as each EU country controls its own legislative system.

“Certifications” Can Be Misleading

The post also states that many crypto-related businesses in Norway feature a “seal of approval” from Finanstilsynet. However, Finanstilsynet clarified that these businesses are not exactly approved by it.

All businesses functioning in Norway, crypto or not, are required to submit information to Finanstilsynet in order to comply with anti-money laundering (AML) regulations. However, this does not mean that the businesses in question are actually endorsed by Finanstilsynet – only that they comply with rules and regulations already set in place.

The statement also notes there are a number of disreputable sites that are nothing but scams – and that although the Norwegian government is doing its best to get these websites shut down, caution is highly advised.

Overall, the view of Norwegian regulatory bodies on cryptocurrencies is not negative – instead, it stresses the need for regulation and consumer protection similar to those drawn up for other forms of investment.

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Crypto News Institutions Investing

PayPal and Visa Bet on Blockchain Capital’s US$300 Million Fund

Blockchain Capital, one of the oldest venture capital firms focused on crypto technology, has secured US$300 million in funding with high-profile partners PayPal and Visa.

Blockchain Capital announced the close of Blockchain Capital V, LP, a fund heavily oversubscribed at its US$300 million hard cap, which saw the participation of many strategic investors, pension funds and major university endowments.

Payment Giants Investing in Crypto Companies

Blockchain Capital is a leading venture firm in the crypto industry and has previously worked with several high-profile crypto companies such as Ripple, Kraken, Coinbase, and Anchorage. On June 21, the firm -together with Morgan Stanley Tactical Value – led a US$48 million Series B funding round for Securitize, a Coinbase-backed asset tokenisation platform.

We are incredibly honoured to welcome a world-class group of investors into Fund V who appreciate the value of a firm dedicated to a single industry. As founders ourselves, we know how hard it is to build companies, protocols and, indeed, a whole new industry.

Blockchain Capital co-founder and managing partner Bart Stephens

The Fund V will be focused on DeFi (Decentralised) and NFTs (Non-Fungible Tokens) startups while avoiding the assets themselves. The firm has the decentralised NFT marketplace OpenSea as part of its portfolio.

PayPal’s Head of Crypto, Jose Fernandez da Ponte, said that investing in Blockchain Capital’s new fund allows it to connect with the entrepreneurs leading the change for the DeFi world:

PayPal is committed to fostering an ecosystem of companies making digital currencies more accessible, useful and secure. Investing in Blockchain Capital’s new fund allows us to engage with the entrepreneurs driving the future of the decentralised economy and the new wave of financial services.

Jose Fernandez da Ponte

The firm said PayPal, Visa and other Fund V investors will take part in its strategic partnership program.

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Cryptocurrencies Investing Trading

6 Important Lessons Learnt from Real Crypto Traders

Over the years, people have made a lot of money from crypto – most of whom have done lots of research so they know what they are getting into.

Unfortunately, a lot of promoters, mainly on social media such as Twitter, Facebook and YouTube, feature enthusiastically small cap coins they found profitable and lead plenty astray.

Here is a quick list of six important things to keep in mind while trading crypto (with quotes from real traders via Redditors):

1. Don’t Invest What You Can’t Afford To Lose

Trading crypto is a fundamentally risky endeavour – so only invest what you can afford, as these crypto traders found out.

This crypto trader lost all his crypto while he was sleeping.

I woke up this morning realising that I just lost all of my hard earned money and savings in about 2 hours. Someone got access to my private key (or at least I think so) and everything was gone.

Crypto Trader on Reddit

This crypto trader lost his all his savings by “mistakes”.

Right now I am sick to my stomach, I cannot sleep, and can barely function. After losing money left and right, I finally tipped last night and lost the last bit of a big chunk of my savings that I had ‘invested’ in Cryptos. This story is very hard for me to tell, because I am ashamed. Ashamed of how naive I have been, and how I made mistake, after mistake, after mistake. Saving the dumbest mistake for the last.

Crypto Trader on Reddit

This crypto trader explains the pain of losing money you can’t afford to lose.

For real guys, DON’T put money you can’t afford to lose, it hurts mentally and physically because you get depressed, really thought I was prepared to do that.

Crypto Trader on Reddit

2. The Bear Market Can Strike At Any Time

Over the years, we have seen plenty of bear markets, and they can hit at any time, as these crypto traders found out.

This crypto trader explains how quick the bear market can hit.

Obviously hindsight is 20/20 but I think it’s important to realise that things can seemingly look normal and suddenly you find yourself in a bear market. Some of these were pretty spot on, others not so much.

Crypto Trader on Reddit

This crypto trader explains why “this time is not different”.

Please, please, please be aware that this time is not different. The bear market will return, and it will destroy all of your gains, and at first you’ll tell yourself that it’s just a small correction, and then everyone on Reddit will say it’s just the Chinese new year or something like that, and then you’ll kick yourself for not selling sooner and you promise you’ll sell as soon as there’s another price increase, but it never comes, and you finally give up and accept that you lost a ton of money because you thought this time was different and you thought you could time the market. But it’s not and you can’t.

Crypto Trader on Reddit

3. Partly Cashing Out Can Pay Off

As these crypto traders found out, once you’ve made enough to recoup your initial investment, a partial cash out can pay off, especially in an unpredictable market.

This crypto trader was in relief that he cashed some out before a dip.

I sold a small amount to recover my initial $3000 investment as the price rose; this was a strong psychological barrier for me as now I was purely playing with house money, [so] I literally cannot lose as long as I don’t go chasing losses […] I cashed out $200k yesterday, enough to make an impact in my life while still holding on to a majority of my HODLings. This was literally minutes before yesterday’s dip happened so the sense of relief that came over me was only further reinforced by the dip that soon followed.

Crypto Trader on Reddit

This crypto trader took his family on a holiday with the profits he took.

For the first time … tonight … I took profit!! I didn’t want to do it. I didn’t want to take money away from the investment. I’m thinking long term with what I put in.

We don’t take many vacations as a family. We cut the month tight with bills and our planned vacation got REAL tight. So I sold some profit, not a lot. Enough to enjoy time with my fam!! I thought I may regret it, but I didn’t!! It was totally worth it.

Crypto Trader on Reddit

This crypto trader did not take profits and was feeling the pain of “losing his gains”.

I lost 250k gains and now at losses. 🙁 I joined crypto around March and I was proud that I bought coins that gave me 70% gains because of HODL. But I was too greedy that I didn’t take profit because I didn’t want to let go of the coins I bought for cheap. Now those coins are back to my entry price and even lower. All my gains gone. I don’t know what to do 🙁 If I sell now, what haunts me is that I could’ve sold with all the gains but instead, I’m now selling with losses. I feel bad about this huhu.

Crypto Trader on Reddit

4. Sometimes HODLing Is The Best Strategy

I think we’ve all seen a coin boom after we just sold it. Sometimes just HODLing a coin can pay off, especially when the market follows cycles, as these crypto traders found out.

This crypto trader feels the pain of not HODLing and what might have been if he did, just, HODL.

I watch another bull run happen without being on board, in Dogecoin, the one I got rid of. My holdings would have been worth over $1 million if I held. I track down my old doge wallet info desperately hoping I’m remembering wrong and that I’m still holding some, but it’s empty. The ETH I traded it for is up nicely, but a small fraction of what the doge would have been worth. Strange how upsetting it is to be up 1000% on an investment when you realise you could be up 10,000%.

Crypto Trader on Reddit

This crypto trader’s plan was to just HODL until the next bull run.

I had been through enough bull cycles by this time to know that if/when the next one would eventually came it would dwarf all others. And by the time that happened, what I had learned was that I needed to have a solid plan in place so I could execute it without making irrational decisions.

Crypto Trader on Reddit

5. Day Trading Is A Dangerous Game

Timing the market is not an easy thing to do and trying to predict the bottoms is like “trying to catch a falling knife”. Day trading cryptocurrencies is not an easy game as these crypto traders found out.

It’s really hard to predict which direction the market is going short term. You might see a quick spike up sell a bit and wait for the correction. Then it comes back down and you buy it back. What goes wrong is when you wait a little too long and it starts going back up again, and your buy order never goes thru bc the price is rising / holding / rising / etc….. You bid a penny below value and it just doesnt dip back until it’s past your sell point anyway, now you lost.

Crypto Trader on Reddit

This crypto trader’s friends all lost trying to day trade.

A friend of mine made 400K with day trading. All my other friends lost an insane amount of money trying to do the same. Unless you have the time to become pro I wouldn’t recommend it.

Crypto Trader on Reddit

This crypto trader was trying to “revenge trade” to recoup his losses.

It got to the point where my bank account had no money left to fund my Bitmex account and that’s where I made my biggest mistake. I decided to “borrow” funds from my BTC and ETH cold storage to try to recuperate everything I’ve lost so far on Bitmex. And as I now know, revenge trading never works. Today marked the end of my crypto career, all my alts were liquidated when BTC broke 9k and pretty much dumped right after.

Crypto Trader on Reddit

6. Keep Your Crypto Safe

If you hold your crypto on exchanges, then they control the wallets’ private keys, so they effectively “own” the crypto. Having your crypto stored in a safe location can pay off in the long run, as these crypto traders found out the hard way.

College roommates convinced me to buy bitcoin back in 2010, i ended up buying 10,000 bitcoins for $60-80 and storing them on my laptop, forg[o]t about it until 2014 when my friend randomly mentions it hitting $1k and a good buying opportunity, i rush home to look for my old broken laptop which had the bitcoins on it in the hard drive to discover my mom threw it out and the bitcoins were gone forever, i become severely depressed and affected by this and til this day cant help but think what if i had those bitcoins.

Crypto Trader on Reddit

This crypto trader lost his crypto he had stored on his phone.

Lost .5 BTC off my phone which is a lot to me :(, I recently switched from blockchain wallet to the bitcoin wallet by andreas schildbach which i backed up, but the file was on my phone. I got a new phone HTC one m8 and was excited, had the people at ATT factory reset my note 2 without even thinking in excitement… And its all gone. I cannot find the private key 🙁

Crypto Trader on Reddit

This crypto trader’s hardware wallet is now swimming with the fishes.

It was a tragic boating accident. I just moved all my bitcoin to a hardware wallet, when it happened to slip my hands and into the ocean. Any further transfers done on that wallet are because of Poseidon.

Crypto Trader on Reddit
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Crypto Exchange Crypto News Cryptocurrencies Investing

Bitcoin Exchange Flows Reversing Again as Investor Confidence Returns

Glassnode on-chain analysis is showing a possible reverse in exchange flows, indicating investors are looking to hold again.

Crypto Supply is Moving Back to Wallets

According to analysis done by Glassnode, there has been a reduction in supply held in exchange wallets. This means there are more cryptos being taken out of exchanges in the past month than being put in to trade with.

The analysis looks at the supply in all major exchange wallets, including Binance, Coinbase and Huobi, among others. The red bars indicate supply leaving exchange wallets, and green bars show supply moving into exchange wallets.

To some, this is an indication that investors are reverting to HODL mode by putting their digital assets back into their wallets. On June 18, the outflow increased to nearly six times the previous measurement.

Glassnode also recently released an article explaining why the bull run is far from over, based on patterns of accumulation and distribution.

Exchanges Have Been Booming

During the past two months, the amount of cryptos held in exchange wallets have been at a one-year-high. This could have been due to high volatility created by the media at large, as well as regulatory scrutiny that has made holders nervous and ready to sell. This is also why web traffic on crypto exchanges has been off the charts.

The crypto market attracts new investors eager to make money out of volatile assets. However, it’s important to remember which factors can affect the price of Bitcoin and, by extension, the rest of the market.

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Bitcoin Crypto News Institutions Investing

Goldman Sachs Investors Divided on Whether Bitcoin is an Investable Asset

Goldman Sachs investors don’t seem to agree on whether Bitcoin (BTC) is an investable asset or not.

The multinational investment bank issued a report on June 15 called “Digital Assets: Beauty Is Not in the Eye of the Beholder” – concluding that Bitcoin is no longer an investable asset.

Bitcoin is Not “Digital Gold“

This new report was issued by the bank’s Investment Strategy Group and contradicts its plans to launch crypto investment services in Q2 for its wealthiest clients. As reported, Goldman Sachs began trading Bitcoin futures on June 18 in a partnership with Galaxy Digital.

Further, the report concludes that Bitcoin itself is not digital gold, as gold is not a “reliable store of value”:

The argument that Bitcoin and cryptocurrencies are a digital version of gold does not confer any value to Bitcoin and other cryptocurrencies, because gold itself is not a consistent or reliable store of value.

Crypto May Not Be As Viable an Investment as Many Thought

This also contradicts Goldman Sachs’ May 21 report called “Crypto, a New Assets Class?” where several experts in the crypto field, such as Galaxy CEO Mike Novogratz, were gathered to analyse the current market, outlining a positive future for cryptocurrencies and stating that they were a new alternative investment.

The report suggested that despite many advances in blockchain technology, this would become obsolete with time and many enterprises would turn away from it. It concluded by saying cryptocurrencies are not a “viable investment” for their clients:

After analysing various valuation methodologies and our multi-factor strategy asset allocation model, we have concluded that cryptocurrencies are not a viable investment for our clients.

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Bitcoin Cryptocurrencies Investing

$43 Billion of Bitcoin is Locked Up in Trusts and Global Investment Funds

A report by Financial News London shows that over US$43 billion worth of Bitcoin is currently held by investment companies.

These funds are spread across hedge funds, ETFs and wrapped Bitcoin (wBTC).

19 Firms Declare $6.5 Billion Share of Investments

Another report by Nickel Digital shows that of this total sum, around $6.5 billion worth of BTC has been declared by 19 companies, such as Goldman Sachs, Blackrock, Deutsche Bank and JPMorgan.

MAJOR DEVELOPMENTS IN DIGITAL ASSETS – Report by Nickel Digital

Commenting on the reports, Nickel Digital CEO Anatoly Crachilov said that not only can BTC serve as a hedge against inflation, its adoption by financial institutions may reduce its overall volatility in the near future.

The cryptoassets space remains volatile as it is going through the early stages of an adoption curve. [This is] a very important endorsement for Bitcoin’s emerging functionality of the hedge against inflation. Increasing allocations by large-scale institutional investors and corporate players is expected to lead to a reduction of [Bitcoin’s] volatility over time, due to a longer-term, stickier type of capital brought by those investors.

Nickel Digital CEO Anatoly Crachilov

The same report estimates that $4.3 billion was spent by these companies purchasing the BTC, bringing a profit of over $2 billion.

The vast majority of these companies are based in the US, with a few other publicly declared Bitcoin investors located in Europe, Australia and Asia. However, another survey by Nickel Digital shows that 81% of European institutional investors believe the amount of crypto purchased by wealth management firms is about to sharply increase.

Although the wind may be blowing in favour of mass crypto adoption, it’s important to remember that in the financial world things can change on a whim – so, as always, Do Your Own Research.

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Crypto News Cryptocurrencies Cryptos Investing Surveys

Nearly Half Of Millennial Millionaires Have At Least 25% of Their Wealth in Crypto

The crypto boom has created wealth for young early adopters and according to a new survey, nearly half of millennial millionaires have at least a quarter of their money in crypto.

CNBC Millionaire Survey Findings

According to the CNBC Millionaire survey, about 47% of millennial millionaires have more than 25% of their wealth in crypto. The survey sampled 750 investors with at least $1 million in investible assets, and showed that more than a third of millennial millionaires have at least half their wealth in crypto. Australian millennials are no different, as we recently reported that aussies are more interested in crypto than real estate.

The younger investors were more intellectually engaged with the idea even though it was new. Older investors and the boomers were largely saying, ‘Is this legit?’

George Walper, president of Spectrem Group

Older millionaires are far less likely to invest in crypto due to a lack of interest or an inability to understand it. The survey shows that 83% of American millionaires have none of their wealth in crypto, and only one in 10 keeps more than 10% of their wealth in crypto assets.

Generational Gap Opens Wider on NFTs

The generational divide is at its largest with regards to non-fungible tokens (NFTs). The majority of millionaires say they don’t know what NFTs are, and regarding millennials a third of them are saying they are an “overhyped fad”. The other two-thirds are saying NFTs “are the next big thing”.

Nearly half of millennials surveyed own NFTs, and 40% say they don’t currently own an NFT but have “considered” it. In comparison, 98% of boomer millionaires say they don’t own any NFTs and aren’t considering acquiring any.

US Millionaires Plan To Sell Stocks and Cryptos Before Tax Time

The survey also showed that 69% of US investors with more than US$1 million expect higher taxes under the Biden administration, specifically higher capital gains tax and business tax. This could push investors to sell their investments before the tax hikes come into play. According to the survey, 19% of participants plan to do this.

Businesses Should Be Prepared For New Buyers In The Market

The importance of crypto to young millionaires could shift the wealth management industry as private banks, brokers and wealth management firms scramble to cater to a new, crypto-heavy clientele. Businesses that wish to capute this new market segment must therefore cater to their needs.

We see more and more providers offering access to crypto investing. It’s changing fast.

George Walper, president of Spectrem Group

And as younger millennials become home owners, businesses need to adapt to their needs to survive. Some Aussie buyers are even using crypto as house deposits.

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Bitcoin Crypto News Investing

Hedge Fund Manager Paul Jones Calls Bitcoin ‘a Way to Invest in Certainty’

Billionaire hedge fund manager Paul Tudor Jones says he would want to have 5% in Bitcoin now that he sees how it can protect wealth in the long term.

In an interview with CNBC on June 14, when talking about Bitcoin (BTC) Jones stated that he likes investing in something that is “reliable, consistent, honest, and 100% certain”, and added that he favours Bitcoin as a portfolio diversifier.

Jones’s firm, Tudor Investment Corp, has US$44.6 billion assets under management (AUM) and has recently secured custodial ties with institutional crypto powerhouses Coinbase and Bakkt. Jones had previously recommended 1% to 2% BTC holdings in a portfolio in 2020 but has now stated that 5% would be a good allocation given the current state of the US Federal Reserve.

Uncertainty About Inflation

One of the reasons for changing his position is that Jones is “going all in on inflation trades” depending on US Federal Reserve decisions to address inflation by shifting its policies this week.

If they say, ‘We’re on path, things are good’, then I would just go all in on the inflation trades. I’d probably buy commodities, buy crypto, buy gold …

Paul Tudor Jones

If the FED decides not to do anything about inflation and prices continue to go up, investing in things that increase as price increases is a strategy (inflation trades). In the meantime, inflation data revealed the biggest price spikes in 13 years for two months in a row.

Additionally, Jones stated that stockmarket value has increased to 220% of the US gross domestic product (GDP); at the time the dot.com bubble burst, it was around 200%. This is something Jones said is of concern to him. The FED is currently meeting behind closed doors to discuss the economic figures, with a statement and press conference expected on June 16.

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Bitcoin Crypto News Institutions Investing

$1.5 Trillion Investment Fund To Launch Two Crypto ETFs

Invesco is the latest investment management firm to apply for crypto-based exchange traded funds (ETFs), adding to the pile of ETFs the Securities and Exchange Commission (SEC) still needs to decide on.

According to the filing sent to the SEC, Invesco – which holds US$1.5 trillion in assets – has applied for two ETFs that are crypto-linked equities like Square and Microstrategy. These are the Galaxy Blockchain Economy and Invesco Galaxy Crypto Economy ETFs, where nearly 85 percent of the funds will sit. The rest of the portfolio will be put in other trusts and funds that hold cryptocurrencies.

ETF Applications Queueing Up

A queue of companies waiting to hear about their Bitcoin (BTC) ETFs has already formed. There are at least 12 issuers, including Fidelity Investments, Grayscale Investments and WisdomTree Investments, which are currently chasing Bitcoin ETFs, and the SEC has acknowledged at least six applications. This means it has a limited amount of time to make decisions about approval.

Some of the current Bitcoin ETFs [Bloomberg]

The logic is that since the SEC doesn’t seem to have a favourable view of Bitcoin, Invesco’s funds may be able to sidestep the SEC’s Bitcoin ETF blockades by only investing indirectly in cryptocurrencies.

Other companies have tried a similar route, such as an application for the Volt Bitcoin Revolution ETF filed recently that would also target companies exposed to Bitcoin. Or Bitwise Crypto Industry Innovators ETF, which tracks companies such as crypto miners and payment firms, launched in May.

Earlier in 2021 we also saw the ASX set to launch a Crypto ETF later this year due to high demand in Australia.

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Bitcoin Institutions Investing

Hedge Fund Billionaire Marc Lasry Laments Not Buying Enough Bitcoin

Marc Lasry, a famous American hedge fund manager and co-owner of the NBA’s Milwaukee Bucks basketball team, has regretted not buying enough Bitcoin (BTC) in the past few years.

In an interview on CNBC’s Squawk Box, Lasry said he was surprised by how fast BTC surged in price over recent months, mainly due to institutional demand and widespread adoption.

I think the probability, as more and more people start using Bitcoin, is that it’s going to keep going up. It’s happened a lot quicker than I thought it would. I should have bought a lot more. That was my mistake.

Marc Lasry

This isn’t the first time Lasry regrets not buying BTC. In July 2018, he told CNBC he lamented not buying Bitcoin when it was valued at US$300, also predicting a price target of US$40,000 and that mainstream adoption would expand the cryptocurrency to better markets.

The reason I like Bitcoin is because it’s the one everybody is going to come to.

Marc Lasry

Going Down or Up, Bitcoin is Here to Stay

When asked about the current market status for BTC, Lasry said there are strong arguments for both sides, bearish or bullish. He maintains relatively bullish on Bitcoin. Whether it goes down to US$20,000 or up to $100,000 the market is “already here”, he said, adding it’s unlikely to go to zero.

I honestly don’t know where it is going to go but you’ve got that market, it’s there. I could make you an argument it could go to $100,000. I could make you an argument it could go to $20,000.

Marc Lasry

Lasry is a co-founder and CEO of Avenue Capital Group, a global investment firm founded in 1995. He has been a crypto advocate since he first heard about Bitcoin, making an undisclosed investment in the crypto hedge fund BlockTower Capital a few months ago.

We also saw in recent news that Ray Dalio claims that he owns some Bitcoin, as the list of large investors in cryptocurrencies continues to grow.