Chinese BSN President Says Bitcoin Is Ponzi and Stablecoins Are Not Bad If Regulated

Audy Castañeda
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Chinese BSN President Says Bitcoin Is Ponzi and Stablecoins Are Not Bad If Regulated

Stablecoins like USDT and USDC would be fine if properly regulated, while Bitcoin is a “Ponzi scheme,” China’s BSN chairman told Cointelegraph.

As the Chinese government continues to celebrate the massive drop in the crypto market this year, a well-known local Blockchain expert has referred to crypto as a Ponzi scheme.

Yifan He, CEO of Red Date Technology – a major technology company involved in the development of China’s leading Blockchain technology project called Blockchain Service Network (BSN) – has written a new article dedicated to various types of cryptocurrencies and their alleged Ponzi nature.

“Biggest Ponzi Scheme in Human History”

Published in local newspaper The People’s Daily on Sunday, the article refers to private cryptocurrencies as the “biggest Ponzi scheme in human history.”

The author mentioned the collapse of the Terra network, with the native token Terra (LUNA) – now known as Luna Classic (LUNC) – crashing by 99% and the algorithmic stablecoin TerraUSD Classic (USTC) losing its 1-to-1 parity with the US dollar in May 2022. He also criticized the increasingly popular virtual currency concept known as X thing-to-earn, referring to move-to-earn or play-to-earn projects, calling the model “phishing strategy.”

The BSN president also mentioned some well-known criticisms of Bitcoin (BTC) by Microsoft founder Bill Gates and legendary investor Warren Buffett.

Yifan He himself is not a fan of Bitcoin or other similar cryptocurrencies. “Currently, all unregulated cryptocurrencies, including Bitcoin, are Ponzi schemes, as I understand it, with different levels of risk based on market capitalization and number of users,” he said in a statement to Cointelegraph on Monday.

The president of BSN added that he has never had any cryptocurrency wallet or assets related to them, as he asserts that, “I do not touch them and I will not touch them in the future even if they are regulated because I do not consider them to have any value.”

According to He, governments like El Salvador’s – which chose to adopt BTC as legal tender – “seriously need basic financial training.” The executive told Cointelegraph that, “Otherwise, they put entire countries at risk, unless their original intentions were to build state-owned cryptocurrency trading platforms and scam their citizens.”

He’s Further Remarks

Although he criticizes Bitcoin and many other cryptocurrency projects, he still believes that a part of the cryptocurrency market could serve if properly regulated. Cash-backed stablecoins such as Circle’s Tether (USDT) and USD Coin (USDC) should not be viewed as Ponzi-type schemes, the BSN president said, stating that, “USDC or USDT are payment related currencies, they are not speculative assets. Once they are fully regulated they will be fine.”

He previously spoke in favor of stablecoins in 2020. The executive once planned to integrate stablecoin payments into BSN starting in 2021. The plan was ultimately scrapped due to China’s hostility towards cryptocurrencies.

The news comes amid the Chinese government’s capitalization on the ongoing cryptocurrency market crash to justify its multiple bans against the sector. The latest coordinated ban was enacted in September 2021, with multiple Chinese authorities taking steps to ban all types of cryptocurrency transactions in the country.

Despite all efforts, China remained a dominant provider of Bitcoin mining around the world. According to data from the Cambridge Bitcoin Electricity Consumption Index, China was the second-largest producer of BTC mining hash rates, behind the United States, as of January 2022.

By Audy Castaneda

Google Users Think BTC is dead: Five Things to Watch for about Bitcoin This Week

Audy Castañeda
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Google Users Think BTC is dead: Five Things to Watch for about Bitcoin This Week

BTC price action is on track for an all-time monthly close below the 200-week moving average.

Bitcoin (BTC) starts a new week above $20,000 but is headed for a new bearish record as a key support level remains out of reach.

After a quiet weekend punctuated by a brief rally to around $22,000, the BTC/USD pair is back near Friday’s closing price on CME futures markets.

With the June month-end closing fast approaching, Bitcoin is facing a few days of reckoning amid what could be its worst monthly performance since 2018.

Traders Expect July to Provide BTC Price “Catalysts”

While the weekend spared the average hodler from any more nasty surprises, data from Cointelegraph Markets Pro and TradingView shows, the fact remains that BTC/USD is far from where anyone wants it to be, even in a bear market. .

With the key 200-week moving average (WMA) out of reach, there is very little bullish sentiment in the market, as evidenced by the “extreme fear” of the Cryptocurrency Fear and Greed Index, which is still firmly in control.

Expectations are that the first week of July could provide the next big bout of market volatility in cryptocurrencies and risk assets.

“Not much has happened overnight when it comes to Bitcoin, but I expect a pretty slow week due to the lack of catalysts currently,” confirmed popular Crypto trader Tony.

How Normal is this Bear Market?

As some panic and sell their BTC, analysts are scrambling to show that there is nothing unusual about the extent of the Bitcoin bear market so far.

Among them is on-chain analytics firm Glassnode, which in its recent research paper, “A Bear of Historic Proportions,” called for calm for BTC holders even though its price fell below $20,000.

“Bear market lows have historically been set with BTC falling -75% to -84% from its all-time high, and taking a duration of 260 days in 2019-20, to 410 days in 2015,” he wrote.

BTC Risks Facing Its First Monthly Close Below the 200WMA

With three days to go until June, things look worrying or “interesting” for Bitcoin, depending on one’s perspective.

With the bear market in full swing, the BTC/USD pair remains below a key trend line that has supported it during previous macro lows. The 200-week moving average (WMA), which has never decreased in value, is currently at $22,430.

As Cointelegraph reported, in previous bear markets, Bitcoin has held the 200 WMA as support while moving below it to make price bottoms.

However, this time the level is turning into resistance, as attempts by the bulls to follow historical norms repeatedly fail. As such, the end of the month could be “interesting,” says Stock-to-Flow pricing model creator PlanB, as it would mark the first-ever monthly close below the 200WMA.

Bitcoin Dominance Plummets

Altcoins were suffering even more than Bitcoin recently due to the turmoil of several major projects, such as Terra and Celsius.

Now, however, the tables are turning: Bitcoin’s dominance has reversed after rising this year, leading to suggestions that altcoins could be the most attractive investment in the short term.

“Bitcoin dominance is going down hard. The advantage is currently held by altcoins,” the popular Twitter account BTCfuel summarized.

After hitting an 11-month high of 48.36% on June 11, Bitcoin’s share of the overall cryptocurrency market capitalization has dropped to 43.46% at the time of writing, a remarkable turnaround in less than three weeks.

Bitcoin is Popular Again, but for the Wrong Reasons

Data from Google Trends confirms that more people have searched for “Bitcoin” on Google this month than at any other time since May 2021.

However, both then and now, BTC price action was heading for long-term lows, rather than highs, indicating that it is bearish events that trigger popular interest.

For this reason, the activity of phrases such as “Bitcoin is dead” has increased, which social media users have pointed to as a possible sign that the market is in a “capitulation” phase.

By Audy Castaneda

Top Two Cryptocurrencies to Watch This Week: BTC and UNI

Audy Castañeda
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Top Two Cryptocurrencies to Watch This Week: BTC and UNI

Although Bitcoin is struggling to establish a bottom, altcoins are on a roll and the current price action could benefit UNI.

US equity markets staged a strong rally last week, led by the Nasdaq Composite, which gained 7.5%. The S&P is up about 6.5% for the week, while the Dow Jones Industrial Average posted a 5.4% gain.

Keeping with its close correlation with the equity market, the crypto markets are also attempting a relief rally. Bitcoin (BTC) has seen a modest recovery, but some altcoins have risen strongly in the past week. This suggests that investors are taking advantage of the sharp price drop to accumulate altcoins at lower levels.

Smaller investors have taken advantage of the drop in Bitcoin to increase their position until they have at least one Bitcoin. Data from Glassnode shows that the number of Bitcoin wallet addresses holding more than one Bitcoin increased by 873 between June 15 and June 25.

Could the recovery of Bitcoin and altcoins pick up momentum? Let’s study the charts of the top two cryptocurrencies that could go up in the short term.

BTC/USDT

Bitcoin’s relief rally is facing stiff resistance near $22,000 as seen by the long wick of the June 26 candle. This indicates that the bears are unwilling to give up their edge and are selling on rallies.

Sellers will try to push the price towards the $20,000 vital support. This is an important level to watch as a bounce off it will suggest that the bulls are attempting to form a higher low.

That could increase the prospects for a break above the 20-day exponential moving average ($23.155). If this happens, the BTC/USDT pair could indicate a possible change in trend. The bulls will then try to push the price towards the 50-day SMA ($27.424).

Conversely, if the price turns down and drops below $20,000, it will suggest that the bears are still in control. The sellers will then try to sink the BTC/USDT pair to the crucial level of $17.622.

The failure of the bulls to push the price to the 38.2% Fibonacci retracement level of $23,024 suggests a lack of demand at higher levels. The moving averages have flattened out and the RSI is just above the midpoint, which suggests a range-bound action in the short term.

UNI/USDT

Uniswap (UNI) rebounded strongly from $3.33 on June 18 and has reached the tough overhead resistance of $6.08. The bears are aggressively defending the level, but a small silver lining is that the bulls have not given up much ground.

The bears are attempting to stall the recovery near the $6.08 resistance, but the rising moving averages on the 4-hour chart suggest that the bulls have the upper hand in the short term.

If the bounce off the 20 EMA holds, it could increase the possibility of breaking above $6.08. If this happens, the pair could pick up momentum and rally to $6.66 and then $7.34.

If the price breaks below the moving averages, the pair could drop to $20,000. A break below this support could indicate weakness.

On the other hand, if the price bounces off the moving averages, it will suggest that the bulls are buying the dips. The bulls will then try to push the price towards $23,024. If this level is crossed, the next stop could be the 50% retracement level of $24.693.

By Audy Castaneda

The Bulls Take Bad News to Benefit the Price of the Ethereum Cryptocurrency Ether

Alexander Salazar
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The Bulls Take Bad News to Benefit the Price of the Ethereum Cryptocurrency Ether

The value of Ether increased significantly after reaching its low of USD 880, but bulls and whales took that opportunity to buy cheaply. An inverted Head-and-Shoulders pattern in the 4-hour timeframe will bring benefits shortly, but the price will fall to a support zone at USD 1,200.

Over the last few days, the crypto market has made a modest recovery. The Ethereum cryptocurrency Ether (ETH) has been an altcoin that has attracted the most attention. Many predicted it would drop below USD 1,000 again, causing a panic, but the bulls took the bad news to drive prices higher.

ETH is trading at around USD 1,202 and has accumulated a 6.9% gain over the last seven days. While its daily trading volume is above USD 12.86 billion, its market capitalization is about USD 145.47 billion, according to CoinGecko.

US Economic Reports Influences the Recovery of the Ether Price

The price of Ether increased significantly after reaching its lowest level of the year at USD 880. However, that pullback attracted bulls and whales, who took the opportunity to buy cheaply. The recent reports on the US economy were another factor that motivated the bulls to acquire ETH.

The economic changes in the United States have affected Ether, the same as other markets. For example, the rate hike and the aggressive policy by the Federal Reserve (Fed) have influenced the ETH price during 2022. However, a recent composite report from US purchasing managers showed a decrease in manufacturing activity to a 5-month low.

The chief investment officer of FlowBank explained to the Wall Street Journal this should lead the Fed to soften up. However, the recovery in the price of cryptocurrencies may not last long as banks may continue to hike rates.

Besides, ETH 2.0 developers ask investors for patience as they are working on some details. They have had to postpone the launch aiming to have time to save ETH and avoid a crash below USD 1,000.

The Analysis of the Price of Ether on 4-Hour Charts

The price action of Ether in the 4-hour timeframe shows an inverted Head-and-Shoulders pattern, which will bring benefits shortly. However, the price will fall to a support zone at USD 1,200, marked by the middle margin of the ENV channels.

If prices retrace to the bottom margin of the ENV channels, there might be a trend reversal to the downside.

According to the charts, the price has not yet broken through the ascending channel of the trend. In addition, the RSI scores indicate there will be a slight drop to the above levels. The Relative Strength Index showed overbought signals, suggesting that a pullback to take profit is healthy to continue the trend.

In conclusion, there might be a pullback for the bulls to gain strength and retest resistance at USD 1,275. If the price ascends to that level, it might be heading for USD 1,500 in the medium term. However, if the aggressive Fed policy continues, there might be a new crash.

By Alexander Salazar

Low Bitcoin Inventories on Exchanges Indicate a Bullish Sentiment in the Market

Alexander Salazar
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Low Bitcoin Inventories on Exchanges Indicate a Bullish Sentiment in the Market

The Bitcoin balance on exchanges reaches a 3-year low at 2.3 million BTC, the lowest since 2018. That scenario may mean that the strong selling wave seen a few days ago is over.

Bitcoin (BTC) has traded between USD 20,000 and USD 21,900 for five consecutive days, reaching higher lows. However, its price has not yet been able to exceed the USD 22,000 line.

That scenario reflects that the selling force of Bitcoin seen when its value dropped to USD 18,000 has stopped. The rise in its price to almost USD 22,000 indicates an increase in demand and long-term holding. It is thus possible to perceive a change in the behavior of traders.

According to data from Glassnode, the Bitcoin balance on cryptocurrency exchanges is 2,384,477,040 BTC. That figure, the lowest since 2018, indicates that many traders are not on trading platforms. That happens because selling their holdings does not interest them as much as a few days ago.

The Low Bitcoin Balance on Exchanges Reveals Long-Term Holding

Little Bitcoin inventory on exchanges usually means that traders are holding/storing their funds for the long term. In that way, they speculate that the price of their tokens will increase over time.

For example, MinimalTrader has taken advantage of the drop in the price to buy and hoard more BTC. After five years of experience in Bitcoin trading, he considers those buying the cryptocurrency amid the current bearish market lucky. He thinks its price will become much lower and that this challenging downward scenario allows learning a lot.

It is also possible to see that the purchase of Bitcoin by the whales (long-term investors) increased over the last few days. That has happened precisely among those having between 1,000 BTC and 10,000 BTC. Analyst JCoiners said it is only a matter of time for the reaction of this trend to break the bearish market.

That scenario shows the bullish sentiment in the Bitcoin market amid a bearish cycle that has lasted seven months. Therefore, this might be the beginning of the recovery in the price of BTC, as Binance CEO Changpeng Zhao believes.

Last week, the leader of Binance said that he believed the worst part was over. He considers the drop in the Bitcoin price to USD 18,000 was the bottom of the cryptocurrency for this season. Economist Jose Sarasola explained the wave of fear sales or loan leverage characterizing this season might have ended.

He stressed that those investing in Bitcoin must be ready to withstand this storm. Likewise, he stated that the worst financial crisis in history lasted 25 months, but the bearish trend of Bitcoin began seven months ago.

According to the Fear and Greed index, there is still extreme fear in the market. For that reason, the Bitcoin capitulation may not be over yet. It will be necessary to see if the demand for the cryptocurrency consolidates to start a new bullish run. Otherwise, there might be lower prices in the short term.

BTC is trading at around USD 20,920 and has accumulated a 2.0% gain over the last seven days. While its daily trading volume is above USD 18.51 billion, its market capitalization is about USD 399.14 billion, according to CoinGecko.

By Alexander Salazar

Ripple May Leave the United States if They Lose the Lawsuit against the SEC

Alexander Salazar
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Ripple May Leave the United States if They Lose the Lawsuit against the SEC

Ripple and the court work hard to solve the legal battle soon, but the SEC uses any possible tactic to delay it further. According to Garlinghouse, the SEC contradicted itself by suing Ripple over XRP but allowing Coinbase to go public.

Ripple CEO Brad Garlinghouse recently said they might leave the United States if they lost the lawsuit against the Securities and Exchange Commission (SEC).

All that happened after they announced their plans to open an office in Toronto, going from 50 engineers to hundreds of employees.

Toronto Mayor John Tory stated that it is essential to make decisions that include the use of innovation. In that regard, that Canadian city is the fastest-growing tech community in North America.

They Put Pressure to End the Lawsuit

The legal dispute originated in 2020 when the SEC regulators alleged that Ripple executives sold USD1.3 million worth of XRP. The federal agency considers the digital asset an unlicensed security.

Ripple stated that it owns many XRP tokens but uses an entirely decentralized network to settle XRP.

According to Stuart Alderoty, general counsel of Ripple, the case might last until 2023.

However, Ripple and the court struggle to resolve the complex legal battle in the short term. Besides, the SEC has used all possible tactics to delay the long-standing dispute further.

Ripple Plans to Expand outside of the United States

Brad Garlinghouse said the SEC contradicted itself by suing Ripple over XRP but allowing Coinbase to go public.

The CEO of Ripple told Axios that Ripple could move out of the United States entirely. They would do that if they lost the lawsuit filed against the company by the SEC.

When asked if he could re-domicile the California-based company to another country, he said they would.

Garlinghouse commented that the world is working as if they have already lost the case, with a few exceptions. He added that nothing would change if they did not win the lawsuit against the SEC.

The executive concluded that the government prevents potential innovation when setting policy through punitive enforcement measures rather than on paper.

Observers have said that the case would not only decide the fate of Ripple but would also shape the future of the crypto sector. Besides, losing the case could mean other crypto companies leaving the United States for other more friendly countries.

Ripple Plans to Explore IPO after the SEC Lawsuit Ends

According to Brad Garlinghouse, Ripple will seek a public listing after completing the litigation.

The CEO of Ripple argued that they were at a point on the scale where that is possible. He also said their business would continue to grow once they get through that lawsuit with the SEC.

Garlinghouse told news television network CNBC that Ripple expects certainty and clarity from the regulator. He has constantly insisted that the United States introduce proper regulations for crypto assets.

XRP is trading at around USD 0.351 and has accumulated a 9.0% gain over the last seven days. While its daily trading volume is above USD 975.71 million, its market capitalization is about USD 17.13 billion, according to CoinGecko.

By Alexander Salazar

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