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Warren Buffett to have lunch with TRON founder

  News

Will rat poison squared be on the menu?

Here’s a fun development. TRON founder and BitTorrent CEO Justin Tron has paid over $4.5 million to sit down to a steak lunch with legendary investor Warren Buffett.

 

The prize of a meal with the world’s most famous investor was part of a charity auction for the Glide Foundation, which helps the poor, homeless and those with various addictions. Buffett has been involved with the charity for many years, and this is the twentieth year he has agreed to have lunch with whoever stumps up the most cash. So far so good. But here’s the really cool bit.

 

Buffett does not like bitcoin. He really, really hates it – though he has started to come around to the idea of blockchain potentially providing some useful service to society. Here are some of the things he has said about bitcoin and crypto in the past:

  • It’s nothing more than a ‘gambling device’.
  • It has ‘no unique value at all. It doesn’t produce anything. You can stare at it all day and no little bitcoins come out. It’s a delusion basically.’
  • It’s ‘rat poison squared’.
  • ‘Cryptocurrencies will come to bad endings.’

 

Buffett has admitted he doesn’t know much about how cryptocurrencies work. And Justin Sun has said he’s a big fan of Warren’s long-term value investment approach. So when he and seven of his crypto-industry friends sit down to a steak – presumably without rat poison – it’s going to be an interesting opportunity to educate the world’s most successful investor about blockchain.

 

In a Medium post, Sun writes:

The long-term value investment strategy and cryptocurrency, in my eyes, are one and the same. We in the community know we have a long road ahead of us to educate the mainstream on blockchain’s value and proper use cases. Rather than trying to get rich quick, we aim to counsel everyone that investment should be about vision and execution.

I look at the upcoming lunch with Buffett as an opportunity to seek mutual understanding and growth. To aid in the conversation and support the overall cryptocurrency and blockchain community, I will invite several industry leaders — with your input — to accompany me to New York City for the lunch.

 

From one perspective, it looks like Sun just paid $4.5 million for him and his mates to spend a couple of hours trolling Warren Buffett on bitcoin. From another, it’s an olive branch from a successful blockchain company to an insanely successful but skeptical investor.

 

We’re looking forward to seeing how this one turns out.

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Tuesday Inferno market update

  Analysis

We knew the correction was coming. We just don’t know how far it will go…

 

Bitcoin is back in the red. After a doji candle on the weekly – a sign of the market’s indecision – the price faltered and finally crashed. At the time of writing, BTC is trading at around $7,900, having hit a yearly high of $9,097 last week and touching a low so far today of $7,730.

 

This should not come as a surprise. We know that parabolic increases are unsustainable. Bitcoin spent just minutes above $9k. We had bearish divergence on the 1-day chart. This has been coming a long time.

 

So the question is: where will the falls end?

 

You can never predict the market, but you can take educated guesses, reduce risk and maximise opportunity. So here’s how it looks:

 

We have support at $7,600, coinciding with the 50% fibonacci retracement from the recent move above $9k, starting from the recent pullback to $6,200. But very likely we need to look at the bigger picture here, because this feels like a more significant wave in the market’s development.

 

If we look at the whole rise, from the very low of $3,100 up to the high of $9,100, we can see that we have our 23% fibonacci level around $7,700, which coincides with existing support. There is also good support in the $8k zone – but for the time being, that has turned resistance since we are trading underneath it. We’d ideally look to move higher and back-test $8k.

 

It’s also worth noting that there is coincidence between existing support at $6,800, the 50-day moving average, and the 38% fib from the whole year’s run-up.

 

Further down, $6,100 lies at the 50% fib and, of course, is within the strong support that was established throughout last year and checked only recently. That seems like a reasonable target for this retracement – though as ever, this is not trading advice and is offered for information only. Finding support and consolidating here would be very bullish.

 

Why? Because this is how bear markets end. A downtrend, followed by a crash to a new low: capitulation. A bounce from the low, a break of resistance (established by old support), and then a back-test of that resistance as new support. In our case, there was resistance at $4,200, but stronger resistance in the $6k zone. Testing that and moving back up would be confirmation that the bull market is on. It would also prove a very attractive risk/return point.

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Difficulty for beginners

  For beginners

Hashrate just hit an all-time high. So did Difficulty. But what even are those, anyway?

 

You might have heard of Bitcoin’s hashrate or Difficulty mentioned as a metric of the health of the network, and not had a clue what it means. The crypto press tends to celebrate these two numbers rising, and wring their hands when they fall. But why?

 

Hashrate, and Difficulty (which is derived from hashrate), are measures of the interest in Bitcoin from miners – the ones who secure the network and process transactions. You can find both figures at https://bitcoinwisdom.com/bitcoin/difficulty. Bitcoin is known as digital gold, so we’ll use an analogy from gold mining.

 

Hashrate is the number of men with shovels digging for gold. Or women. Bitcoin mining is an equal opportunities endeavour, so long as you’re a machine.

 

Difficulty is the number of workers with shovels you need to find a nugget of gold every 10 minutes.

 

As more and more people find out about Bitcoin, more miners buy rigs and start mining – just like in a gold rush, more people buy shovels and start digging. But here’s where Bitcoin is different to gold. There’s a limited amount of gold and bitcoin in the world, but the rate at which they are mined is different. The faster you dig, the more gold you find. But when miners put more hashrate into finding bitcoin, that doesn’t mean more BTC are mined. Instead, Difficulty adjusts upwards. Difficulty is retargeted every 2 weeks, and its job is to make sure that the same amount of bitcoin are mined every day – in other words, that blocks are 10 minutes apart on average. More miners doesn’t mean more bitcoins, it means each miner receives less BTC.

 

When hashrate is high, and rising, it means that the network is highly secure and that interest is growing. Hashrate tends to follow price, because when BTC is more valuable, you tend to get more miners chasing it. When the price drops, fewer miners are able to cover their costs, and some switch off their rigs. That tends to lag a price drop, though, because miners have large sunk costs (their rigs) as well as ongoing costs (electricity).

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Sunday Inferno round-up

  Digest

Welcome to the weekend once again. Here is your summary for the week:

See you tomorrow with the latest news and developments in the crypto space!

The Inferno team

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Dr Robin and Professor Bär take battle for recognition as Bitcoin creator to court

  News

The two were close friends throughout their childhood, but an acrimonious dispute over the origins of Bitcoin – fuelled by allegations of drug-taking and sexual rivalry – has driven a wedge between them.

 

While the crypto world is still trying to grasp the implications of recent claims concerning Satoshi Nakamoto, another battle is raging in the courts over the prize to become publicly accepted as Bitcoin’s creator. Edward Bär and Christopher Robin, once inseparable friends who lived and worked together, have become mired in a seemingly intractable legal battle concerning the origins of the world’s foremost cryptocurrency.

 

Dr Robin, now a well-known but controversial tech entrepreneur, claims that he created Bitcoin with Professor Bär shortly after the two left university, where they studied on the same higher mathematics course.

 

‘By claiming to be Satoshi Nakamoto, Bär has overstepped the mark once too often,’ commented Dr Robin in a rare public statement outside the London courthouse where the trial is being heard. ‘He has taken credit for my ideas too many times in the past, but claiming to be Bitcoin’s creator is beyond the pale.’ Asked why he does not simply prove it with a signed message using the keys from the Genesis block, Robin is clear: ‘This is about the law, not maths. It’s a matter of intellectual property, not sums. You don’t bring a knife to a gunfight. This is happening in court and “Pooh” as his few friends know him, is going down.’

 

‘Personal’ rivalries

Speculation about the acrimonious feud between the two friends have been fuelled by reports from sources close to the pair that their argument is personal as well as professional. ‘It started when they were living together in the same student flat,’ commented Ms Kinga Roux, who has known them both since childhood. ‘There was a lot of drugs and partying, and on at least one occasion Bär slept with Robin’s girlfriend. Robin was livid but did nothing at the time because they were working together on an early version of what would ultimately become Bitcoin. He needed Bär’s help.’

Professor Bär, for his part, claims that he was far more than the ‘helper’ to Robin: he was the chief architect of the project. He was the one who wrote the white paper and the original Bitcoin code, he maintains, while pursuing a successful career in academia. Robin was no more than an editor and occasional consultant, according to his version. ‘Robin stole the ideas for Bitcoin from me, pure and simple – #IamSatoshi’, he wrote in a recent tweet. ‘I have the private keys to the Genesis block, I could prove it whenever I wanted,’ he explained in a separate blog post. ‘But the world does not need cryptographic proof of the identity of Satoshi. It needs legally-enforced recognition. That’s all that matters.’

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Friday Inferno market round-up

  Analysis

TL;DR it finally happened. Did you catch it?

 

The long-awaited dip has finally occurred. At this point in time, bitcoin does not seem to be making measured moves. Instead, it soars by a thousand dollars a day, then consolidates a while, and then it’s another massive move up. Conversely, when it falls, it really falls hard.

 

Yesterday we saw BTC break up out of its downwards consolidation flag to put in a new high for the year: $9,097. The $9k area has been a magnet for price, with momentum suggesting that bitcoin would make at least one more leg up before correcting – something that was long overdue.

 

We have seen one mega-correction before recently, two weeks ago today, when bitcoin dropped $2,000 in a day, including $1,000 in a matter of minutes. This correction was less severe, but BTC still fell over $1,000 from its peak. The bottom so far has been $8,000 dead. So, what is next?

 

We’re of the opinion that this actually changes very little. We knew that a correction was needed, and while $1,000 is a lot, it doesn’t put the uptrend in any danger. Even if the price fell back to $6,000 – a 33% correction from the top – we wouldn’t be worried. That would arguably be very healthy for bitcoin. When the market rises so far and so fast, there needs to be some kind of retracement. If there isn’t then the uptrend is not sustainable, and will end sooner than we want. If this is the start of a multi-month or multi-year bullrun, there will be pullbacks here and there.

 

With that in mind, we can look for much the same targets as before. $6,000-$6,800 is our strong support zone, where bitcoin spent so much time in 2018. Bouncing off this would be a sign of strength, especially if it was a higher low – above the $6,178 of 17 May. To the upside, we’re looking at $9k once again, now established as resistance, and of course $10k.

 

The one thing we do know for sure is that there will be volatility. We’re probably looking for another large leg down, or else a ‘Bart’ formation back up to $9k. At this point, it’s impossible to say which it will be.

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Peter McCormack could be on the hook for £100k+ in CSW libel case

  News

One of our favourite crypto voices, UK podcaster Peter McCormack, is being sued by Craig Wright for calling him a fraud over his Satoshi claims. Peter has a big decision to make before tomorrow about the direction he will take the case.

 

There are plenty of people who have called Craig Wright a liar, scammer and a fraud. Many have been anonymous, or attempted to remain anonymous – like @hodlonaut, a European who has also been the target of Wright’s legal rage. Others have lived in unfriendly jurisdictions. Peter McCormack, a bitcoin trader, blogger and podcaster, happens to live in the same jurisdiction as Wright: the UK. He’s a publicly-known figure, and he has publicly called out Wright about his claims to be Satoshi. As a result, Wright is suing him in the UK courts for £100k.

 

McCormack has a critical decision to make before tomorrow. As he writes in a long thread about the case on Twitter:

1/ People have been asking for an update on the legal case with CSW, so here it is. I am being sued for libel and have until Friday at 12.00 to make a decision. The claim is for £100k and includes a number of other requirements.

 

2/ The options at present are:

– Represent myself

– Represent with legal counsel

– Compromise through mediation

– Do not contest

 

3/ For full support from an expert lawyer, the cost for the initial defence is estimated at around £25k – £50k. If this goes to a full trial, the worst case to defend would be £500k – £750k. If I lose, it could be double that as I would have to pay CSW’s legal fees (£1.5m).

 

McCormack continues, explaining some of the issues around the case. It is difficult to prove a negative – that Wright is not Satoshi – and it appears that the UK legal system would not require Wright to prove that he is Satoshi to settle in his favour. Fighting the case will be expensive, and ‘9/ Many have offered money to support the case but I have never wanted to take the money from individuals. This is your Bitcoin and I did not want this to go to lawyers.’ Moreover, he is fighting people with ‘very deep pockets’ who will not hesitate to stoop to intimidation and harassment.

 

In short, Wright holds most of the best cards, merely because he has more money, thanks to wealthy backers like Calvin Ayre, who has a vested interest in maintaining that Wright is Satoshi. Due to the way the law works, other cases in the US cannot be used in the UK in this instance – even if they show that Wright is not Satoshi, or has lied in court (for example, by providing faked documentation).

 

This is a classic case of the little guy getting smashed by the big guy, even though he is right and everyone knows it. We hope that Peter will change his mind about crowdfunding his defence. We hope that he will accept the goodwill of the crypto community who want to see Wright taken apart in public and ultimately have this matter settled, once and for all.

 

This ‘I Am Satoshi’ nonsense has gone on long enough.

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Signs your crypto might ‘default’

  News

Finnish researchers have looked at the factors that can predict the failure of a cryptocurrency project – or, as Forbes’ writer puts it, its default.

 

This won’t come as a big surprise to many in the crypto space, but there are certain things you should look for in a crypto if you want it to be around in a few months or years’ time. Researchers from the University of Vaasa in Finland have looked at the chances of a cryptocurrency ‘defaulting’, as Forbes’ Simon Moore, an investment writer, puts it – showing very little understanding of what a crypto is or how it works. To ‘default’ suggests the currency has an obligation to repay you something, and then doesn’t, or that it has assets that it loses somehow… It’s 2019, and the state of journalism around cryptocurrencies is better than it was when we started. But some of these guys. ‘Default’, seriously? But we digress.

 

The paper pinpoints a number of factors that decrease a currency’s long-term chances of success (see how you can put it a different way that still makes total sense, Simon?). These include:

 

  • A strong first day of trading. And Day 1 really is the most important day – after this, the beneficial effects of volatility seem to reduce. A busy first day on the exchange and then a period of stability seems to be one of the marks of a coin that will last the distance.
  • A low pre-mine. A no-brainer, though the research suggests a very low threshold – somewhere in the region of 0.5% pre-mine seems best. (The study includes only PoW-mined coins, not PoS.)
  • A public team is better than having an anonymous founder. Bitcoin is an exception here – usually founder anonymity is a bad sign. Again, it makes it easier to slip away, with or without the money, without facing the consequences.
  • Lower rewards are a good sign. Counter-intuitively, higher rewards point to less chance of a coin lasting – perhaps because ‘investors’ rush in for the short-term benefits, and don’t care about much else.

 

Tick all these boxes, and there’s a decent chance your crypto will last for at least 4 years. And that it won’t ‘default’.

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Tuesday Inferno market update

  Analysis

Last week ended with a bang – again. This one could shape up to be something special. One thing’s for sure: it’s going to be volatile.

 

Bitcoin is taking another breather after pushing upwards to another yearly high on Monday – $8,939 on Bitstamp. Right now it’s trading around $200 lower than that, which represents an entirely reasonable pullback after the $900 move we saw on Sunday night and the early hours of Monday morning.

 

And so we’re back where we have been many times already over the last couple of months. Bitcoin has put in a gravity-defying leap higher, and is consequently overbought . Daily RSI has spent most of the last two months above 70, the weekly is currently at 79, and while the lower timeframes are coming back down from overbought now, they have almost run out of room to go higher at times.

 

In short, a pullback is absolutely to be expected. And yet, we’ve been here many times already and exactly the opposite has happened. Despite being massively overbought, profit-takers have not proven equal to new buyers.

 

Now at some point – some point – the situation must change. Bitcoin must correct sooner or later, even if it’s after putting in a new all-time high (though we’re fairly sure it will happen long before that). But bitcoin keeps confounding traders and conventional wisdom by shrugging off the technicals and putting in another leg up.

 

What are the key areas to watch for now? Obviously we are close to $9k. The $9-10k zone is a natural target, with the round number acting like a magnet, as well as this already being an established resistance zone. If we do not get a pullback before breaking $10k, it will be truly remarkable. And once $10k is gone, there is comparatively little resistance at all – some at $12k, but then practically nothing to $20k (and then nothing at all above that).

 

Below, we’re looking at the low-$7k level for support, and then the $6k region should provide some strong support should we need it. It was there for us many times in the long bear market, and should be there again if bitcoin dips that far.

 

For now, all bets are off and conventional thinking doesn’t seem to apply. Bitcoin could soar past $10k, or it could crash to $6k. Neither would surprise us.

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New York Post want Trump to fix bitcoin

  News

Donald has better things to do with his time, but would be upset that it’s even harder to control a decentralised online protocol than it is to get North Korea to be nice.

 

John Crudele does not like bitcoin. The chap is a ‘columnist and business journalist’ who writes for the New York Post. In the past, he has written several articles about bitcoin – or about his opinion about bitcoin, which is predictably mainstream. This conventional thinking can be seen growing increasingly shrill over the recent months, culminating in this article asking US President Donald Trump to investigate the source of manipulation in the bitcoin markets.

 

Donald probably has better things to do with his time, like the burning need to tame North Korea, and his hair, so it’s unlikely we’ll get Crudele’s wish any time yet – which is an investigation by ‘the Securities & Exchange Commission, the Justice Department, the IRS, Homeland Security and any other agency that will eventually get in on the action.’

 

But if there was an investigation, then what? The US has already legitimised bitcoin itself, with the sale of the Silk Road coins (the US government doesn’t sell illegal goods it seizes, like drugs). And it has created the BitLicense, New York’s regulatory framework for crypto, which many other states are following. So sure, it could make trouble for exchanges on which manipulation occurs, assuming they’re in its jurisdiction. But bitcoin is here to stay: that’s now the official position of the US.

 

Crudele wants bitcoin to disappear. He writes:

‘Federal Reserve Chairman Jerome Powell has said ,’There are investor and consumer protection issues as well’ with bitcoins, Powell told the House Financial Services Committee a year ago. Powell also said cryptocurrencies are not real currencies because they have no intrinsic value. I’ve said the same thing when a bitcoin was selling for $20,000. And still was saying it when it plunged to $4,000. Its real worth: $0.

 

There are always those who are going to be on the wrong side of history. Crudele can share the company of Nouriel Roubini and Warren Buffet.

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Twitter

Ethereum 2.0 Planned For Launch on the 3rd of January 2020
#Ethereum, #blockchain, #crypto, #cryptocurrency

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