Bitcoin continued trading within its AU$8,800 – $9,100 trading band for another week now, closing flat for the week at AU$8,840. We did see somewhat of a pull back on Friday around the same time the SEC ruling on EtherDelta was released (see below). ERC20 tokens were hit the hardest. ZRX down over 11%, OMG down ~2.5% for the week. XRP continued to see some choppy price action, rallying more than 21% at the start of the week on the SWIFT rumours (see last week’s market update) before coming off a quite a bit, closing the week up 9.5%.
- Centre stage this week is the BCH scheduled hard fork, set to take place around 3:40am Sydney time, Nov 16. Almost all major exchanges, with the exception of Poloniex and Bitfinex, are supporting only the BitcoinABC chain, at least initially. There has been plenty of threats from both the ABC and SV camps to weaponise their respective mining pool allies hashpower to not only ascertain hashrate dominance, but also to disrupt the opposing chain by mining empty blocks and dumping the newly mined tokens onto the open market. An extremist vigilante mining pool by the name of Sharkpool has been created by Ari Kuqi (of CashPay.Solutions). They seem to be aligned with Bitcoin SV, and plan to openly attack any alt coins that do not follow their own vision.
- The SEC has cracked down on EtherDelta in a landmark case. EtherDelta is a US registered entity operating a decentralised ERC20 exchange that executed more than 3.6 million orders, including tokens that are now deemed as securities under federal securities laws. The EtherDelta exchange is relatively small in the grand scheme of things, leading people to think that the SEC decided to nail an easy target as a way to create a precedence for larger cases in the future. The situation is similar in Australia, with ASIC requiring any dealer of security tokens to operate under an Australian Financial services license. As far as I know ASIC are not issuing these yet for businesses primarily dealing in crypto. If and when they do, there will be a lot of interest from broker/dealers and companies wishing to launch STOs.
- New York based crypto fund Greyscale reported USD$330 million in new investment funds this year. These are big figures considering the 55% price drop that we have seen in XBT since December. Greyscale operates several crypto long-only funds, with a pure Bitcoin fund representing 74% of its total assets under management. Roughly 70% of Greyscale’s investors are institutional investors, meaning hedge funds, pensions and endowment funds etc. The remaining clients are mostly high net worth investors and family offices. It is encouraging that this sort of smart money is coming into the space in spite of the negative price movements we have been seen this year.
Marcus Ochmann – Head of OTC Trading