Bitcoin Dropped in Mid-July and Analysts Are Wondering Why

Leonardo Perez
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Bitcoin Dropped in Mid-July and Analysts Are Wondering Why

Could this be the end of what was once a billion-dollar industry just three years ago?

Despite a solid rally in the previous week, in mid-July Bitcoin experienced something of a price crash. It fell to around $30K even after several weeks of trading above $31,000 per unit.

Bitcoin Endured Some Slips

The crypto market took some nasty hits, such as non-fungible tokens (NFTs) selling off drastically. Many major collections have seen their prices drop as more and more people begin to question whether these assets are worth anything. Pixel art has always been in the air, but now some are beginning to see that the value doesn’t really exist.

While Bitcoin and many other assets have seen price declines, not all analysts are concerned. There are several who seem to believe that things are not only in good shape, but that slight fixes like these are healthy for the industry. K33’s Bendik Schei explained in a recent note, “After Bitcoin’s massive 14 percent gain last week, the market took a healthy pause.”

The fall in Bitcoin could potentially contribute to the Federal Reserve raising borrowing costs again after private payroll data shows things are much better than initially anticipated. Wall Street is now starting to see bitcoin and many other assets in a whole new light according to Matt Maley, the chief marketing strategist at Miller Tabak + Co. He explained it in a recent interview:

“Higher rates are having an impact. The bulls were already disappointed that Bitcoin could not break out after the euphoria surrounding the BlackRock ETF presentation. so this recent jump in interest rates is pouring salt in the wound of those bulls.”

One of the problems right now is the existence of various cryptocurrency companies suing other cryptocurrency companies, which creates instability and turmoil in the market. Gemini Trust Co., for example, is suing Digital Currency Group Inc. and its CEO, Barry Silbert, alleging that the company engaged in “fraud and deception” after Gemini obtained several frozen funds from the company.

BTC in August 2023: Recent News

On August 18 around 9:35pm UTC, the Bitcoin price suddenly plunged more than 8% in a span of 10 minutes, taking the broader crypto market with it, leaving many in the crypto community scratching their heads.

EToro market analyst Josh Gilbert attributed the drop to a report that SpaceX may have sold some or all of its $373 million worth of bitcoin holdings, which stemmed from an Aug. 17 Wall Street Journal article.

Tina Teng, a market analyst at CMC Markets, shared a different view, pointing to the recent rise in government bond yields as the main cause of the sell-off. Teng explained that rising bond yields often show reduced liquidity for the broader market.

However, while Teng dismissed the Evergrande crisis as a major reason for Bitcoin’s price swing, Matrixport’s head of research Markus Thielen claimed that the risk of a Chinese yuan devaluation may have played a role in the massive sale.

Bitcoin had rallied slightly since the crash, gaining 1.2% in two hours, according to data from TradingView. At the time of publishing this article, bitcoin was changing hands for $26,619. Its price appears to have been boosted by news that the SEC could approve an Ethereum futures ETF product in October.

By Leonardo Pérez

Bloomberg’s Ripple Blunder Sparks Backlash: SEC Does Not Appeal XRP’s Status

Audy Castañeda
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Bloomberg’s Ripple Blunder Sparks Backlash: SEC Does Not Appeal XRP’s Status

Ripple’s XRP in legal turmoil and media clash as Bloomberg’s misleading report sparks debate.

Ripple’s XRP token has come under intense scrutiny, caught up in a whirlwind of legal action, misconceptions, and a scramble for accuracy of the facts. An unexpected turn of events has erupted, pitting media titan Bloomberg against the unyielding forces of the XRP army.

Bloomberg’s Mistake: A Headline Gone Wrong

The Securities and Exchange Commission (SEC) recently asked a federal judge for permission regarding Ripple’s XRP token, prompting Bloomberg to publish a headline reading: “SEC Moves to Appeal Ripple’s Decision That XRP it is not a value.” That is what Bloomberg would have readers believe.

The headline was immediately met with backlash. Professional XRP lawyer John Deaton and CryptoLawUS quickly corrected what they called demonstrably false information:

“Hey @ChrisDolmetsch – this story is false on very important facts you got wrong. Nothing in this brief is related to the XRP token not being a security. It is entirely about the CHANCE to file an expedited appeal about specific OFFERS AND SALES by the DEFENDANTS of XRP. Not the token itself.”

The post was immediately replied by X users such as @WhaleWire, in the following terms:

“Numerous mainstream news sources are stating that SEC plans to challenge the court’s ruling that $XRP is not classified as a security. However, this is false. It’s only about offers/sales, and SEC even admitted themselves that XRP is not a security and they won’t be appealing that.”

John Deaton, a well-known pro-XRP lawyer, took to X to express his dismay at Bloomberg’s coverage. His concerns weren’t just minor details; they were core events that could significantly affect markets.

“I have to say there is no doubt 75K #XRPHolders are a major reason the SEC is conceding this issue. We fought to have the judge actually that the token itself is not the security. In fact, it was the first section in our argument in the Brief.”

The case document explicitly stated that the SEC did not request an appeal review of any holdings with respect to XRP. The SEC’s request was for an expedited appeal only, not a motion to appeal anything related to the XRP token is not a security. Deaton stressed the importance of getting the terms right and accused Bloomberg of publishing a false story.

The Complexities of the Case: What’s Really Happening?

A $100 million lawsuit fought for 2.5 years had established that only XRP offers and sales could be securities. The distinction between the token and the sales was a central fight in the case, and Ripple won this battle.

The SEC’s recent filing was a request for an expedited appeal on specific decisions by Judge Torres. It was not related to the XRP token being a security. This nuance, while complex, is a critical aspect that had been misrepresented by Bloomberg.

Clarification from Ripple’s CTO David Schwartz

David Schwartz, Ripple’s CTO, admitted that the SEC asked for the certification, essentially permission to appeal. His voice added credence to the fact that the SEC’s request was fundamentally different from what Bloomberg portrayed.

With major media outlets like Bloomberg stumbling and warriors like John Deaton and CryptoLawUS stepping in, the fight for truth and justice continues. The war is not won, nor is history complete.

By Audy Castaneda

Why is Raising Capital Becoming a Challenge for Crypto Startups?

Audy Castañeda
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Why is Raising Capital Becoming a Challenge for Crypto Startups?

VC investments in crypto have plummeted by 90% compared to the previous year. Regulatory pressures and significant declines in AUM from key VC firms are contributing to this funding crisis. Maarten Bloemers, co-founder of GET Protocol, advocates a return to the spirit of cryptocurrencies.

The cryptocurrency industry is facing a stark reality. Raising capital is increasingly becoming an uphill battle. Venture capital investments in cryptocurrency-related projects are declining significantly.

As highlighted in a recent report, just eight crypto-focused VC funds had raised a combined $500 million globally as of May 16, 2023.

Decreased Funding from Venture Capitalists

This marks a 90% drop in funds to receive financial support compared to the previous year. So what is causing this crisis in crypto funding and how is it reshaping the industry?

Maarten Bloemers, co-founder of GET Protocol, provides a candid perspective on the declining number of venture capitalists investing in crypto and blockchain startups. Bloemers said that “Venture capitalists are currently busy with the challenge of maintaining their existing portfolio companies, which leaves them with limited capital to allocate to new investments.”

Bloemers’ ideas point to a puzzling situation. Due to the current adoption curve, VCs may find it difficult to find limited partners for new Web 3.0 funds, which could stifle growth opportunities for the crypto industry in expanding adoption.

Multicoin AUM Plummeted to $8.7 Billion

Over the past year, the assets under management (AUM) of several crypto venture capital firms have experienced significant declines. For example, Multicoin’s AUM plummeted from an initial figure of about $8.9 billion to a much lower $1.4 billion by the end of 2022.

Similarly, Paradigm saw its AUM decline from $13 billion to an estimated $8.7 billion over the same time period, according to Newcomer data.

While AUM may not be the definitive metric for evaluating a company’s prosperity and can fluctuate due to factors unrelated to fund performance, it is still a valuable indicator of financial health.

The ripple effects of these developments are widespread. Following the spectacular collapse of centralized exchanges like FTX and subsequent banking crises, regulators have redoubled their scrutiny of the crypto industry.

The Role of Artificial Intelligence

In addition to regulatory tightening, a notable shift in VC attention from cryptocurrencies to artificial intelligence (AI) is evident.

Fortune reported a significant increase in median valuation before money for generative AI companies. This valuation has ballooned to $90 million as of the current year, based on the nine transactions PitchBook has recorded through March 29. This marks a substantial increase from the $42.5 million figure recorded for 2022.

In addition, early-stage AI startups that focus on various applications, including software development, customer experience enhancement, and media creation, are also receiving high ratings.

Bloemers reframes this trend more as a liability of the crypto industry than a betrayal by venture capitalists. He dismisses the idea of ​​crypto projects integrating AI components simply to attract investors. Instead, it encourages construction “because it adds value to a large enough market.”

As Bloemers succinctly sums it up, navigating the crypto market, especially in these times, is “a marathon, not a sprint.” In such a marathon, a return to the roots and spirit of cryptocurrency could prove to be the most potent form of resistance: Build not for speculative hype but for substantial, transformative value.

By Audy Castaneda

What Is Decentralized Science (DeSci)?

Audy Castañeda
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What Is Decentralized Science (DeSci)?

How to restore the universality of Science? Transparency and accessibility solutions brought by decentralized science and Web3 could be a solution.

“What is unique for the scientist is that he must not only seek the truth but proclaim it” are the words of Robert Oppenheimer that illustrate the importance of sharing scientific knowledge.

However, do scientists have the means to proclaim this truth? In fact, today, some reject the scientific word, because they think it is exploited by governments or big pharmaceutical companies. Decentralized science and Web3 could offer a way to restore the universality of science.

Decentralized science (DeSci or decentralized science) is a movement whose goal is to modernize traditional science and provide a comprehensive public infrastructure for scientific research, publication, and funding.

Specifically, the tools made available by Web3 such as the chain of blocks, smart contracts, and decentralized autonomous organizations (DAOs), among others, allow us to glimpse a more accessible and transparent science.

DeSci advocates want to develop an environment where everyone can easily share their scientific work, as well as access and contribute to the work of other researchers. Decentralized science also strives to provide more diverse funding sources and offer a censorship-resistant model of scientific research.

Challenges of Research Funding: Solutions Offered by DeSci

The current research funding system has several shortcomings that limit its effectiveness. For researchers, obtaining funding can be a tedious task, since it requires preparing many files. The latter must comply with the requirements of bureaucratic processes that are usually long and complex.

The lack of public funding for scientific research can also force scientists to seek private funding, which can lead them to get involved in projects that do not correspond to their interests or those of society.

It is common for companies to fund studies to promote the use of their products. This practice can skew the perception of science as an unbiased search for the truth and can lead to public mistrust in the results of scientific research.

To overcome these inefficiencies, DeSci is emerging as a particularly interesting solution. In fact, Web3 technologies such as DAOs, quadratic voting, and retroactive funding offer new prospects for supporting scientific research.

A Decentralized Autonomous Organization (DAO) is an entity managed collectively through the blockchain and that works with a joint mission. In the case of DeSci, the goal of a DAO is to fund scientific research projects. It also makes it possible to create a link between donors and researchers, to the extent that the latter can transparently follow the progress of the research project.

Little Transparency of Scientific Publication: Solutions Provided by DeSci

In academia, peer review processes are managed by scholarly publishers who trust that researchers’ work is free. In addition, scientists have to pay to publish their research, and worse, they may not even have access to the publication, since most online academic journals are paid. The need for transparency is crucial.

The solution can be community-like Halogen. This platform aims to replace the monopoly of scientific journals with a self-organized network of self-sufficient scientific communities. Publication, editing, documentation, and financing take place at the community level.

NFTs also offer excellent prospects for scientific research. Instead of simply publishing articles, researchers have the ability to create and own NFTs of their articles, which can then be cited by their peers.

Decentralized science offers hope for more transparent, accessible, and equitable research that helps restore the universality of science. However, there is still a long way to go for its full adoption.

By Audy Castaneda

Coinbase Will Suspend USDT, DAI, and RAI Trading for Canadian Users

Leonardo Perez
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Coinbase Will Suspend USDT, DAI, and RAI Trading for Canadian Users

It was informed through a statement sent to its clients by email. The suspension will be from August 31 at 12:00 p.m. Users residing in Canada will have the ability to trade the tokens until the cut-off date.

Cryptocurrency exchange Coinbase has finally confirmed that USDT, DAI, and RAI trading will cease effective August 31 at 12:00 p.m. The statement was transferred to its clients by email. The news was shared by numerous users on social networks, by way of reporting the news.

Users residing in Canada will have the possibility to trade the tokens until August 31. After that date, trading in the aforementioned cryptocurrencies will be disabled for all Canadian Coinbase customers. However, it will still be possible to withdraw and deposit stablecoins after the deadline to trade those options.

Reasons for Coinbase’s Decision to Suspend USDT, DAI, and RAI Trading for Canadian Users

Although the firm has not elaborated on the reasons for the suspension, the internal statement suggests that it may be related to the new regulations in Canada: “We regularly monitor the assets on our exchange to ensure they meet our listing standards.”

Coinbase was launched in that country just a few days ago. The idea was to provide wire transfer services to Canadian users while seeking to expand into that market. Even changes in the Canadian crypto market in recent months were a reason the company seemed to use to attract customers from that country.

The exchange purported to offer Canadian users a free 30-day Coinbase One membership. Members would be eligible for zero trading fees, enhanced staking rewards, 24/7 priority support, and other perks.

The situation changed in a matter of hours, though, and the exchange wrote the following statement;

“Coinbase Canada, Inc. has filed an application for registration in certain Canadian jurisdictions, but has not yet obtained registration. Until Coinbase Canada, Inc. obtains the registration, it has agreed to abide by the terms of a commitment.”

In February it became known that the Canadian Securities Administrators (CSA) would impose new rules. These regulations would require cryptocurrency trading platforms to sign a series of terms and conditions of operation, in parallel to the fact that their applications are under review. Coinbase was one of the signatories to participate in that process.

Other Exchanges Chose to Withdraw from Canada

At the beginning of 2023 Binance made the determination to withdraw from Canada. The decision was due to new regulatory changes. The company had previously expressed high hopes for the Canadian blockchain industry.

However, the new guidance related to stablecoins and the limitations on investors in cryptocurrency exchanges, made the Canadian market no longer profitable for Binance at that time.

A similar situation was experienced by Bybit, who announced his departure from Canada in May, even though he complied with all the country’s rules and regulations. Although he did not state his reasons, it is known that the new regulation had a decisive influence. Kraken and Crypto.com modified their registry and reduced their listings.

Since the beginning of 2023 the Canadian authorities have been taking measures regarding cryptocurrency regulations. The Ontario Securities and Exchange Commission has published a notice stating that it has strengthened supervision of cryptocurrency trading platforms in the country.

The notice outlines the “investor protection commitments you expect from crypto asset trading platforms (CTPs) operating in Canada.” It specifically refers to the multiple bankruptcies that have taken place in recent times.

By Leonardo Pérez

Users of Katlas, the AI ​​Bot, Warn of a Possible “Exit Scam” – SEO Alert

Audy Castañeda
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Users of Katlas, the AI ​​Bot, Warn of a Possible “Exit Scam” – SEO Alert

Katlas is artificial intelligence for investors, doing algorithmic trading, leaving manual trading behind.

Everything indicates that the Katlas platform, recently launched on July 24, has closed its scam. It all started at the beginning of this week.

Users’ agitation began at the beginning of the week, since on Monday, August 14, some users began to ask about the status of pending payments -in unofficial groups-, since the platform was not originally taking more than one time to make payments.

About Katlas

According to their website, Katlas is a new automated service that helps users trade the stock market without any experience. That is, artificial intelligence for investors that performs algorithmic trading and leaves manual trading behind.

They offered a bonus of $20 USDT, completely “free”. Another important point to highlight is that none of its board of directors is a well-known character in the crypto world, or of which there was any verifiable experience of success. And, as if that were not enough, they refer to a company registry that does not correspond to them. That is, in our analysis it became obvious that the registration and regulations mentioned by the platform are false.

Nexus with Velzon Bot

Among the various “scammer hunts” that issued warnings about this platform, one “rumor” stands out that we mentioned in passing earlier. Nanocoinrenovado is a YouTube channel in which paid content is made promoting platforms, and although it can be considered that the complaint against Katlas was initially due to a difference regarding advertising payment, the truth is that this character established a link between Velzon Bot and Katlas.

Despite all the red alerts that we highlighted in the original article in which we presented this project in our “Uncovering Scams”, the possibility that both platforms could be related by the same creators, was one of the most serious alerts of its nature. fraudulent. This was due to the very behavior of Velzon Bot, which had already been branded as a scam after they asked their users for more money.

The point is that this YouTube channel assured that one of the “real” members or at least one of the “familiar faces” behind Velzon Bot is a certain “Jack Gough” on Telegram, and stressed that he is also listed as one of the main in the Katlas Telegram. Also, Katlas’s lifespan practically began when Velzón went into a tailspin.

The Closure of Official Channels

On July 25, there was already an update showing that the situation went beyond a simple payment delay, as the leaders and the supposed CEO, Michael Wright, stopped responding in the official group.

On Wednesday via the Alerta Digital – Scam Alert   YouTube channel the official channels were reported to have been closed. It was also announced that the CEO never made a presence in the Zooms that Katlas carried out, not to mention that the platform was used in its free mode, because the videos did not last more than 45 minutes.

By August 16 the groups were still closed. The ultimate test was that on Thursday, August 17, the website could no longer be accessed.

This shows once again how important it is that crypto enthusiasts and investors review, know and thoroughly analyze the platforms in which they are willing to invest their money. Red alerts are clear signs that there is a greater probability that a given project will end up escaping with its users’ investment.

By Audy Castaneda

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