Buying BTC for Investors – Current Market

The market remains lacklustre, but relatively predictable. I’ve had more success with recent BTC price predictions than what I normally have – which gives me added confidence in my current buying strategy. This post explains that strategy.

It’s no secret that I have had BTC buy orders in the $8000s for a good few weeks now, if not months. I constantly check the charts and update my TA in order to ensure that my buy orders remain valid. At the moment, I am happy that they are set at the right prices. I will now explain why:

Firstly, take note that I have done away with my regular diagonal Fib levels for the time being. As the bullish price action drew to a close, so those levels started to lose their relevance. The nature of the current market correction is such that diagonal Fib levels no longer a reliable means of price prediction. Obviously this will change at a later date, but for now I find no value in using them.

I predicted a BTC reversal of fortunes and a price drop over the weekend (on Twitter and in the TIMM Trading Pits). That price reversal/drop occurred late on Friday.

https://twitter.com/brain_bit/status/1169959815923273728

Calling the price turnaround was not hard, the TA was pretty clear. What is still unclear for now, is whether BTC is in a bearish converging triangle or a negative channel. Fortunately this doesn’t matter much – as the outcomes of the two are fairly similar – at least for investors.

Below we can clearly see how BTC respected the top of the channel/triangle and became negative – a trend which should now continue for the remainder of the working week, possibly longer.

Made by Bit Brain with TradingView

It could be that the top of my channel/triangle is not correct (because I have excluded short-term outlier candles), but thanks to the latest data, it looks as if making the top of such a channel/triangle less steep does not tie in with the observed price movement data. The upper limiting line which I have created ties in nicely with the bottom of the channel, i.e. it runs parallel to it, giving credence to my theory that what looks like a triangle may still be a channel.

Made by Bit Brain with TradingView

Channel or not, we are seeing support at $9500 – giving credence to my theory that BTC may be in a triangle despite looking as if it is in a channel. Looking at the bigger picture, I see no reason why BTC can’t be in a triangle within a channel – which I now believe is actually the most likely state of affairs.

Upon reaching support at $9500, I believe there is a good chance that support will not hold (as indicated on the chart below). Perhaps I’m wrong and it will hold. Perhaps BTC will bounce back up to the top of the triangle, before turning negative again. Much like I said in my post a week ago, other indicators such as trading volume and various momentum indicators show that a positive breakout for BTC is very unlikely at this stage. What this means is: if BTC does not break downwards through the bottom of the triangle this time, then it will probably do so the next time it tests the $9500 support level.

Made by Bit Brain with TradingView

Looking at the chart above in more detail, we can see a historical support level exists between roughly $8100 and $7500. Provided that BTC price does break lower, I expect this support level to arrest the drop in price. Should it fail to do so, then price should stop dropping when it reaches the bottom of the channel – roughly at $7000 (that price changes over time due to the downwards slope of the channel).

So where should an investor look for a buy point?

Bit Brain’s BTC Buying Tactics

There is a risk that BTC hits the bottom of the triangle, and then bounces back upwards, never to return so low again. Chances of this happening are slight, but not negligible. For this reason it may be a good idea to buy at the turnaround point of $9500. I am making $9500 an “Optional Buy Point’ for myself. 

If BTC price decline slows significantly as it approaches $9500, I will assume that it does not have the momentum to break through, and will set a buy order just North of $9500 to avoid missing out on the dip. This will not be a big order – perhaps about 20% of my allocated funds – because there is still a fair chance that price will drop lower later on.

However, if BTC approaches $9500 at speed, chances are that it will shatter the support there. In such a scenario I will not buy at $9500, instead I will wait to buy in the $8000s, as I have been for the last couple of months. Since there are no other meaningful support levels in the area, I will not buy in the low $9000s. If BTC does break downwards through $9500, it should hit the $8000s – which is where I will start buying (as indicated on the chart below).

Made by Bit Brain with TradingView

“Buy Zone 1” is my main buying zone, it lies between $9000 and $8100. I plan to spend 60% of my allocated BTC buying funds there – with the option of spending more if it looks like BTC won’t go any lower than $8000. I have buy orders at around $8900, $8500 and $8200 – these vary as my local currency fluctuates against the dollar, so I have to adjust them from time to time. At $8100 we once again encounter historical support – so that is where I stop buying.

Should BTC break through that support, I will be ready to pick it up at prices of between $7400 and $7000. This is “Buy Zone 2”. $7000 is the bottom of the channel (at least for now). If BTC fails to reach Buy Zone 2, then I will spend all of my BTC buying funds as the price moves back upwards through “Buy Zone 1”.

I do not see a scenario where BTC will drop below $7000. Firstly, because $7000 is the bottom of the channel, but secondly (and probably more importantly), because BTC can’t drop below $7000 without breaking through the Long-term Base Trendline. (as seen below).

Made by Bit Brain with TradingView

The Long-Term Base Trendline is four years old and well established. It is highly unlikely that BTC can remain below the level of this trendline for very long. As a side note: I believe this trendline to be a measure of BTC adoption as well as the baseline from which any rally is launched. Interestingly, if I’m right about that, it means that reaching the trendline indicates that there is no hype in the market at that time.

If BTC does break though the long-term trendline, it will become incredibly unstable and likely to bounce back fast and hard. It also means that I will be willing to place even more money into it – money I will rob from my normal fiat money savings accounts. Obviously this is risky and not something I would recommend for most people. I’m telling you what I will do under such circumstances, not what you should do. 

This unlikely buying opportunity is labelled “Unlikely Buy Zone” on the chart below.

Made by Bit Brain with TradingView

That rounds up my latest weekly look at BTC. As for the rest of the market: altcoins remain in decline – providing excellent buying opportunities for shrewd investors who are willing to do their homework. In the bigger picture, I watched in amazement late last week at how money floods out of stores of value and back into the fiat-based markets on the slightest little whiff of optimism wrt US/China trade talks. They’re not even building a house of cards anymore, they’re building a house of rice paper. And it’s starting to rain…

Yours in crypto

Bit Brain

All charts made by Bit Brain with TradingView

“The secret to success: find out where people are going and get there first” 

~ Mark Twain

“Crypto does not require institutional investment to succeed; institutions require crypto investments to remain successful” 

~ Bit Brain

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Bitcoin Technical Analysis – 02 September

In “BTC analysis – 26 August” I updated my latest thoughts on Bitcoin’s medium-term movements. Since then a price reversal in the $9300s has forced a reassessment of that situation.

Previously I spoke of a bull flag. That flag was forming in a descending channel and was adhering to diagonal Fib levels as it did so, something like this:

But what appeared to be a series of higher lows caused me to reconsider and change the flag into a pennant, as seen in my BTC post last week:

Now things have changed again – or at least may be about to change.

The price movements of this last weekend may have altered the bull pennant into a more bearish converging triangle pattern.

At this stage we require a confirmation move, which we will get, one way or another.

Scenarios:

The chart below shows the two main scenarios that we may now be dealing with.

In Scenario 1 BTC is forming a converging triangle with a near-horizontal base. Scenario 1 will be confirmed if price continues to rise to about $11000.

In Scenario 2 BTC is still in a descending channel. Scenario 2 will be confirmed if BTC ceases to rise well short of $11000 and then falls below $9300 for a sustained period (more than just a few hours).

Scenario 1

If Scenario 1 is correct then it is most likely that BTC price will remain in the triangle until the final quarter of 2019, after which it will probably break downwards. We can see that a downwards break is more likely, because a flat-bottomed triangle is an indication that support is continually being tested. Eventually that support “runs out” (as buy orders are filled and traders decline to place new orders that high in a market which is turning bearish). In addition to that, most momentum indicators (such as the MACD, RSI or long-term MAs) will show that momentum is becoming/has become negative. Most telling of all is the volume, which is still steadily declining.

In the likely even that BTC does break out of this (unconfirmed) triangle in a downwards direction, the big question will be “How Low?”
Recent support lies in the high $7000s/low $8000s. That is enough to catch the dip, but don’t get a shock if it fails to hold there. If support breaks, then the next recent support level only lies at $5600 and below. I think that any dip that low will be very short lived. If you do see BTC that low then buy like crazy! Between the high $7000s and $5600 is another possible support level in the mid to low $6000s. This is the support level established in 2018, though its continued existence is uncertain because:

  1. It broke conclusively in November 2018.
  2. No resistance was encountered at that level when BTC climbed through it in May of 2019.

After the dip, we can expect a rapid recover and then a steady climb along the long-term base trendline for BTC – until the market turns properly bullish and hype sets in.

Scenario 2

If Scenario 2 is correct, then BTC will most likely decrease in price all the way to the bottom of the channel. Since the channel is downwards sloping, the price level at which BTC hits the bottom of the channel continually decreases over time. Were price to reach the bottom of the channel today, then it would be at around $8000. But if it only reaches it a month from now, then it will be in the mid-$7000s.

Scenario 2 is still reminiscent of a bull flag, which means that it precedes a swift increase in price after hitting the channel bottom. It is unlikely that price would then bounce up and down for yet another cycle within the channel, that would be too unusual.

Likelihood

I consider Scenario 1 to be a very likely Scenario. I allocate a probability of 55% to Scenario 1.
Scenario 2 is not very likely anymore. I allocate a probability of 20 % to Scenario 2.
The remaining 25% is for “something else” – an as yet unforeseen price movement or variation of one of the above scenarios.

Conclusion

Whatever happens, I am predicting a relatively bearish two or three months. I think we will see a decent sized dip soon. I have been waiting with Buy orders in the $8000s for a few weeks now. Depending on what happens next, I will consider shifting some or all of those orders a bit lower, and/or perhaps placing additional Buy orders at even lower prices.

I do not see the market really picking up before December 2019 at the earliest, but on the other hand, I’m predicting a stellar (not Lumens) 2020 for BTC and crypto in general! For now I will continue to stack little bits of BTC if I can afford it, AND ALTCOINS! There is blood on the streets, this is the time to accumulate alts!

Yours in crypto

Bit Brain

All charts made by Bit Brain with TradingView

“The secret to success: find out where people are going and get there first” 

~ Mark Twain

“Crypto does not require institutional investment to succeed; institutions require crypto investments to remain successful” 

~ Bit Brain

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Crypto Shopping Cart – 11 August

 

I haven’t traded much in the last month or two. With the altcoin market still dead, one has to move very cautiously: being careful not to sell low and being equally careful not to buy rubbish.

Here’s what I’ve been selling and buying over the last three weeks or so:

 

Shopping trip 1:

The second part of my OByte airdrop came through about a month ago. Byteball (as it was then known) was airdropped to STEEM holders a little over a year ago, and I’ve been holding onto mine ever since, waiting for the second part of the airdrop to unlock. Obviously this was not a large amount (I didn’t have much STEEM a year ago), but every little bit counts, especially in an altcoin market as undervalued as this one is.

I’ve been watching OByte for as long as I have been holding it, and so far I have just failed to see a good use case for it. It doesn’t have the market penetration of similar coins, and it lacks the product differentiation required to give it unique desirability. I’m using the altcoin winter to weed out my weaker projects, and OByte is one of those which I decided to dump.

I headed over to Bittrex to sell it. Sadly I must say that Bittrex really doesn’t seem to be keeping up with the newer exchanges, it’s still a bit of a pain to use. Because my OByte was not worth much, and I didn’t feel like withdrawing BTC that would have cost me half it’s value in transaction fees, I decided to buy the one coin which I still leave on Bittrex: I bought Blocknet

Blocknet is not a name you hear every day. It’s basically a multi-chain, second-layer, blockchain interoperability system. It’s not a sure thing, but I have high hopes for it and see no reason why it should not succeed. To put it another way: I give it far greater odds of success than Cardano! Take a look at BLOCK if you are unfamiliar with it, they have some interesting things going on, including their own DEX (called “Block DX”). https://blocknet.co

Having nothing more to do on Bittrex, I headed over to KuCoin and sold off some of my TenX (PAY). While I still believe in TenX, I have not been happy with all of their recent decisions. A decision with regard to the distribution of tokens was badly received by the community, and indicative of poor management. That kind of thing sets off warning bells, the last thing I want is to sit on another Electroneum-like management disaster. So I dumped about 40% of my TenX and bought KuCoin Shares (KCS) with it. KuCoin shares are always a good investment – at least they have been for the last two years that they have existed.

Shopping trip 2:

Just before the month drew to a close, KuCoin dropped another surprise on us: the KuCoin Shares Lockup program. Staking rewards offered by this three month staking opportunity were ridiculously good, and I decided to participate. KuCoin Shares are not particularly cheap, but they are cheap for what they are. In an attempt to maximise returns on this opportunity, I traded my small emergency Ethereum fund (stored on KuCoin for just such cases) and bought KCS with it. In addition to that, I also sold off a substantial amount of my STEEM that has been powering down for the last few weeks – unfortunately at a very bad price. With altcoins universally low, it’s become a case of “which coins have the best potential for recovery?” I generally hedge my bets, but a STEEM to KCS swap was a no-brainer in this case.

I was fortunate enough to stake my KCS on Day 1 of the lockup at the maximum ROI percentage – I calculate that I should make a profit of over 10% (in KCS) in three months, which is fantastic! The KCS price climbed during the Lockup program, and for the most part it’s held onto its gains – hardly surprising when KuCoin continues to innovate and offer excellent service. See if you can spot the 24 hours before the staking contract first opened on the chart below…

From https://www.coingecko.com/en/coins/kucoin-shares

 

Shopping trip 3:

My most recent shopping trip took place this weekend. ZCash (ZEC) has been under my watchful eye for the last few weeks. I have been growing increasingly uneasy towards it and last week I finally reached the end of my tether and decided to dump it. It’s a risky move: ZEC is far from bad, but I am unhappy with the direction that the management team has moved in. My decision was to get out before the coin suddenly loses most of its supporters – something which I consider to be a very real possibility. I don’t like the funding issues that ZCash is having – that’s bad financial planning. I don’t like the founder rewards disagreements – those are not in the best interests of the community, and have already caused the YCash fork to take place. The final straw for me was hearing that they wanted to basically rewrite the code for ZCash – which would open it up to a whole new set of bugs (remember: this is a privacy coin we’re talking about). Reading the latest posts by the ZCash Foundation and Electric Coin Company (the company which is confusingly ZCash – yet also isn’t – much like the Ripple/XRP obfuscation) did nothing to allay my fears, in fact it made them worse.

I held ZCash for a long time, so this was not a decision taken lightly (especially considering how much the price has dropped since I got it!). I wanted to put the newly freed up ZCash funds into the best possible coins. I sold my ZEC on Binance, so to keep things simple, I decided that I would only buy cryptos from Binance with those funds. I did entertain the possibility of leaving it in BTC, but because BTC dominance is so high right now, I consider any attempt to sell altcoins into BTC as a bad trade and a case of FUD selling. I opted to buy three altcoins instead.

It should be mentioned that I came very close to buying Holo (HOT) again. The only reason I didn’t buy it is that I have a fairly large amount of Holo already when compared to my other alts (not that any of my altcoin holdings can really be called “large” these days!). Civic (CVC) has been on my “want” list for several months now. With Civic at ATL prices, both in BTC and USD, it looks like an excellent buy opportunity. Combined with the fact that it still looks like a seriously good project and that it’s slowly getting some attention, I more than doubled my Civic stack for only a few dollars. I know that someday I will look back on these purchases and laugh. What remains to be seen is if the laughter will be at the massive profits I have made from them, or from the sheer foolishness of buying altcoins in a market that looks so disinterested in them!

Next on the list was Ontology (ONT). I’m still kicking myself for selling the first ONT that was airdropped to me for holding NEO. I often see ONT as a backup to NEO: should NEO for some inane reason fail to takeoff, then surely ONT will. For now my money is still on NEO (literally), but I think that ONT (which is basically just NEO dressed up in a suit and tie) is a very valuable addition to any crypto portfolio.

The last coin in my shopping cart is Waltonchain (WTC). I’m a VeChain supporter at heart, but Walton has always been worthy competition for them, and honestly there’s not much difference between the two. Lately it seems as if my #2 horse in the race has been outperforming my #1. Keeping my ear to the ground, it sounds as if Walton has been making the good deals lately – deals which should increase its adoption. “Adoption” is the name of the game in the altcoin world. With that in mind, I put the last of my old ZEC funds into WTC.

Conclusion

That’s the end of another month of shopping. While the markets may seem dead, I think this is a great time to accumulate all the good altcoins which are being overlooked by the “new money’ in crypto. The more fickle “old money” has turned BTC maximalist for now, but will surely swing the other way again once the altcoin money starts to flow. FOMO will pull them back over to the alts – where some of us have been waiting all along…

These are not the usual coins that I buy – with the obvious exception of KuCoin Shares. I’m taking this opportunity to increase my stake in some coins I don’t hold enough of, and also taking this opportunity to get rid of my non-performers. I’m also seriously considering putting more fiat in – even though I have none to spare – for reasons which I may elaborate on in my next post.

Opportunities surround us in crypto right now, fantastic opportunities. The trick is to tell the good from the bad. Remember that risk mitigation lies in diversification. Good luck out there.

 

Yours in crypto
Bit Brain

“The secret to success: find out where people are going and get there first” 

~ Mark Twain

“Crypto does not require institutional investment to succeed; institutions require crypto investments to remain successful” 

~ Bit Brain

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Say “NO!” to KYC

 

Well it looks like Binance KYC information is all over the internet.

I couldn’t possibly provide links to all the articles I’ve read about it, because they are a dime a dozen. In case you somehow missed them all, here is one, just as an example: https://www.coindesk.com/binance-kyc-issue

Let’s get one thing very clear from the beginning: I’m not anti-Binance. As you can clearly see from my previous blog posts and Tweets, I’m actually a big fan of Binance and of CZ. My only real problem with them is their overly agnostic stance towards cryptocurrencies, even the dreaded Libra.

This is also not one of the (many) posts telling you to panic because your data has been compromised. Panic is stupid and never helps anything. It’s far better to remain calm and find a solution to the problem. It would help if Binance was a little more responsive/open about this issue – take note Binance: rapid and truthful PR is essential in such cases. People don’t panic when they know the truth, they panic when they don’t know what’s going on or when they find out that they were lied to.

This post is a reminder of what I warned you about previously, the evils of KYC.

“Try to give you warning, but everyone ignores me.
Told you everything loud and clear, but nobody’s listening.
Call to you so clearly, but you don’t want to hear me.
Told you everything loud and clear, but nobody’s listening.”

~ Nobody’s Listening – Linkin Park (R.I.P. Chester Bennington)

I will be the first to admit that public dissemination of your KYC data was not (and still is not) first and foremost on my list of KYC-related concerns. But: I did warn you about KYC in general, and proclaimed it to be a bad thing, a bad thing which is being done in an even worse way.

I have big issues with KYC. How many of you remember this article?

I wrote it a little over two months ago. Do you remember some of the things which I said in there?

KYC IS BAD FOR CRYPTO”

“KYC obviously stands against some of the very principles that crypto is built on!

The ability to transact with anyone, anywhere, anonymously is a core concept built into the crypto way of doing business. The matter of asking someone for their identity before agreeing to carry out crypto transactions with them should never even be raised!”

“Crypto was based on a zero-trust model which uses cryptographic methods to ensure trust. IT DOES NOT NEED INDIVIDUAL IDENTITIES IN ORDER TO FUNCTION!”

“A crypto system which demands the identities of its participants is a self-destructive system. It unbalances crypto as a whole and works against the principles on which crypto is built.”

I think that the truth behind my warnings is now starting to become apparent. It doesn’t really matter how or why your KYC data was compromised, or even who did it. What matters is that your data was able to be compromised in the first place! Fact: there is no such thing as a foolproof system. This is especially true in crypto, the cryptospace is still new and many loopholes have yet to be found. This will not be the last such incident! We need to eradicate the procedures which leave us vulnerable!

If Binance had not had any KYC data, then there would have been nothing to leak! Yes, I DO understand regulatory need for KYC / AML etc, we’ll get to that later. But first, let’s look at more of what I had to say in my anti-KYC article:

“…if I need to identify myself in order to make a crypto transaction, why would I not just use a fiat one instead? Either way I’m going to have to comply with regulations. Either way I’m going to end up paying taxes on it. Either way my identity will be known. What KYC does is to strip the usefulness away from crypto, thereby undermining its value and making it not worthwhile investing in!”

…and leading on from that…

 “If my crypto has no benefit to me, then my crypto has no value to me. Then it’s just another unbacked, regulated means of exchange. I have no need for another one of those, I have enough trouble with fiat money as it is.”

Now this is where regulations and centralised exchanges really start to come into it:

“I DON’T agree with KYC procedures which exist to placate the demands of centralised entities, but I do agree with identification procedures that are required to carry out basic business transactions.”

“Centralised crypto exchanges in particular are starting to look more and more like banks (as mentioned by Heidi in her Monday “Crypto tips” video https://www.youtube.com/watch?v=91f-QNSmzrA&t= ). Let’s be very clear here: an exchange does NOT require your name or phone number to change one coin into another!

“Dealing in crypto is not the same as dealing with fiat based assets, crypto is not linked to government assets and governments have absolutely no right to attempt to regulate it. One of the greatest attractions of crypto is that is is beyond the reach of regulations, if crypto is to succeed then it needs to remain that way! Don’t let your own government fool you into thinking that you have to play crypto by their rules, you don’t. Find a way around the rules. Crypto is decentralised, it is designed to to able to avoid such regulations! Giving in to regulations and supporting them is akin to driving a knife into crypto’s back, get out of the crypto space if you want to be like that, it’s counter-productive and will devalue the very asset which you are investing in.”

“KYC is part of the slippery slope to crypto regulation. I stand strongly against it.”

“Show me the government argument in favour of KYC and crypto regulation, and I will show you the counter argument that disproves it.”

A great opportunity which remains a missed opportunity in the cryptoverse, is that crypto projects are failing to leverage the utility that they can provide for one another. I have spoken harshly against projects which insist on using their own KYC procedures and which are not utilising specialist cryptocurrencies designed for that role:

“We have an array of already working and under development Identity Verification cryptocurrencies available to us: Civic, THEKEY, SelfKey, Worbli, NEO ID etc. We as crypto users need to put pressure on crypto companies to use these services. We need to support those who already use these services and demand that the others do the same.

I have taken such crypto projects on in several private emails and occasional public Tweets – such as this one:

From twitter.com

 

There are exchanges and wallets which I refuse to use because they refuse to use other crypto projects.  I know that in a way this looks like cutting off my nose to spite my face, but if we – the crypto community – don’t take a stand to support ID verification projects and stop the endless and unnecessary KYC procedures, who will?

I also know that some of my favourite exchanges require KYC – some at various levels, depending on what you want from them. Binance, KuCoin, even Nash – all exchanges which I highly recommend – have such requirements. I’m not suggesting that you avoid pro-KYC entities completely, but rather that you start moving in the right direction. For instance: Nash is more decentralised than most exchanges (an exchange is not simply “centralised” or “decentralised”: CEXs and DEXs lie at two ends of a continuum, and most exchanges lie somewhere between those two points), so I will be using it a lot after its August 23 launch and will slowly scale down on using the more centralised ones. Similarly, if given the option (in terms of trading pairs), I choose to use Binance DEX over traditional Binance. As seen in the Tweet above, when an exchange like IDEX takes such a bold move in the wrong direction, then I cut it off completely.

I also included quite a few original Satoshi Nakamoto quotes in my anti-KYC post. People need to be reminded of these regularly! People need to remember Satoshi’s vision!

Satoshi quotes:

“Participants can be anonymous.”

“…privacy can still be maintained by breaking the flow of information in another place: by keeping public keys anonymous. The public can see that someone is sending an amount to someone else, but without information linking the transaction to anyone.”

“We have proposed a system for electronic transactions without relying on trust.”

Conclusion

I don’t give a damn that governments want KYC. If you are a large crypto company, and local government regulations are making it hard for you to operate – then MOVE! Don’t try to block users, leave that up to the governments who want to do the regulating. Let people discover the power of the TOR network, VPNs etc. And for crying out loud – stop demanding KYC information! This won’t end well for you or your users!

Let the governments who don’t want crypto seal their own fates. The future of global finance lies in decentralised crypto. If they don’t want to be a part of that future – so be it.

We were lucky with the latest Binance KYC leak, it could have been much worse. Consider this a small taste of what is to come if we continue down the dark path of government-enforced crypto regulation.

To the crypto service providers: I ask you again, with tears in my baby-blue eyes – Use the ID verification projects! Let me login using e.g. Civic. Let me control which information I share with each company. Let me not spread 100 different photos of myself and my identification documents all around the internet!

Simple systems engineering principles are at play here people: you are introducing multiple points of failure – AND THEY ARE FAILING!

Let the KYC we know today die the death that it deserves. It does not matter about government concerns re money laundering, purchases of illegal goods etc. When criminals are selling drugs or guns on your streets, taking away money is not the answer! Yes, without money you can’t buy drugs and guns, but you also can’t buy food, clothing, fuel… The government arguments that crypto transactions are largely in criminal hands are fallacious. FAR more drugs are sold using fiat. FAR more money is laundered using fiat! FORGET ABOUT WHAT GOVERNMENT WANTS! What’s the worst that could happen? They ban crypto? Remind me again how well the drug bans are working after all these years…

Yours in crypto

Bit Brain

“The secret to success: find out where people are going and get there first” 

~ Mark Twain

“Crypto does not require institutional investment to succeed; institutions require crypto investments to remain successful” 

~ Bit Brain

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BTC – Beginning of the Week Analysis

So far, BTC has been bullish in August of 2019 (well – actually since the final day of July).

As usual, the mass media is throwing its theories around (such as THIS one) as to why this may be. Most of them are wrong, but let them throw their theories around anyway – it keeps them busy.

Looking at the market broadly, I would suggest that investor confidence is still relatively shaky, despite good 2019 BTC gains. This is evidenced in the poor performance of altcoins, a good indicator that “Adventurous” and “Confident” are not words to be attributed to investors at this point in time. Instead, I think that BTC price has been growing on the increase in trading volume alone (i.e. increased adoption): by now you are all well aware that 2019 volume is massive – even when compared to that of the 2017 bull run. (See volume on chart below)

From https://www.coingecko.com/en/global_charts

Exciting news! I have started working on a new cryptocurrency metric: a quantitative metric used to determine the investor confidence of the market. Honestly I haven’t checked if such a metric exists yet, perhaps I am just re-inventing the wheel. It’s not the “Bitcoin Misery Index” (I’m using a very different method to what Thomas Lee uses) – but it will give similar results. Either way I’m still busy developing it – learning (mostly by trial and error) the right formulas to use in Google Sheets to make it work. Hopefully I will have it finished soon – I’ll be sure to show you the results when (if?) I do finish!

Back to BTC:

While the ever-fickle media with its goldfish-duration memory is certainly suddenly bullish again, I caution against becoming bullish too fast. The charts below will show you why.

BTC has been in a channel for about a month. Back in this post of 16 July, I identified the top of the channel, but the bottom had yet to be formed, so I took it as a pennant instead.

From https://mentormarket.io/cryptocurrencies/bit-brain/btc-11-july/

This made me bullish on BTC in the medium-term, though I soon found out that my pennant was not a pennant at all. Strangely, this has no affect on my medium-term projections for BTC.

Later on BTC dipped, thereby forming a channel, which I then indicated in my 23 July postwhere I concluded that BTC may be forming a Bull Flag.

From https://mentormarket.io/cryptocurrencies/bit-brain/bitcoin-possible-next-moves/

While BTC has not dipped all the way back down to the bottom of that flag/channel, it has also not yet broken free of it.

Here is BTC today:

As you can clearly see on the chart above, BTC is at a turning point. Either it can breakout of the channel and climb, or it can dip sharply back downwards. I will only turn bullish if BTC breaks out of the top of channel and stays out for a day or more. Obviously this is short-term bullish, in the medium and long-terms I am bullish thanks to the bull flag and to the fundamentals of BTC respectively.

Should BTC fail to breakout, then the rejection dip should look something similar to this:

The bottom of the channel also coincides nicely with an already-consolidated support/resistance level in the mid-$7000s to mid-$8000s region. This will provide strong support and should prevent BTC from breaking through the bottom of the channel if it does head back in that direction.

Having said that: take note that similar price movement patterns in 2017 did sometimes end in a flash crash, followed by an equally rapid recovery (the crash and recovery taking only 2 to 3 days in total). The chart below from “Bitcoin – possible next moves” illustrates what I am talking about. See that post for more details and further examples.

From https://mentormarket.io/cryptocurrencies/bit-brain/bitcoin-possible-next-moves/

Summary:

If BTC does breakout within the next day or two, then we may well see an new 2019 BTC high this week. The next most likely option is that it will drop down to the bottom of the channel – still remaining within the confines of the Bull Flag and buoyed by the consolidation which took place in May/June.

Percentage allocation for possible future BTC price movement:

  • BTC breaks out of the top of the channel: 35%
  • BTC heads back down to the bottom of the channel, or perhaps the 0.786 retracement level (as it did last time): 30%
  • BTC heads back down and breaks through the bottom of the channel: 10%
  • Something else (e.g. Sideways movement, movement along diagonal Fib lines): 25%

Yours in crypto
Bit Brain

All charts made by Bit Brain with TradingView

“The secret to success: find out where people are going and get there first” 

~ Mark Twain

“Crypto does not require institutional investment to succeed; institutions require crypto investments to remain successful” 

~ Bit Brain

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How to Lockup (stake) your KuCoin Shares – Lessons Learnt from Day 1

 

I wrote about the new KuCoin staking plan on Tuesday. This post explained it: “Don’t miss this one!”

True to my word:

I fully intend to lock up my KCS for this period, and I will do so as soon as I can.

I was waiting on KuCoin, ready to lock my KCS as soon as the clock hit 1 August (UTC +8), which was at 16:00 (UTC) on 31 July.

Of course, there were problems…

The problems:

I would be lying if I said I wasn’t surprised. Secretly, I had been expecting some sort of issue, even though I have great faith in the KuCoin team. Blockchain tech is just still all so new; because of this, platforms often forget to take something into account and fail under heavy loads or unusual conditions. This is exactly what happened to KuCoin.

The second that the staking contract opened, it failed. I hopped onto the various social media channels and watched the ensuing chaos for the first few minutes. To their credit, KuCoin were quick to respond. I saw multiple KuCoin admins respond on the telegram channel within minutes.

It turns out that a large block of simultaneous API calls (to lock KCS tokens) had triggered a safety system in KuCoin’s software. From a geek point of view, this is interesting: I have been wondering what safety systems KuCoin has in place – for obvious reasons these are not openly published. I guess we just found one! The safety system shut off the locking contract and had to be reset and disabled for these particular KCS withdrawals. The delay took about 20 minutes to rectify, after which KuCoin announced that they would retry launching the staking procedure 20 minutes later.

KuCoin did a good job of keeping us informed, even replying to my personal thread on Twitter where I and another investor were discussing the issue:

https://twitter.com/KuCoinModerator/status/1156603884401504257

 

 

At 00:40 (UTC +8) the contract was reopened – and it worked.

To make up for the problem, KuCoin made the decision to double the maximum total amount of tokens that could be locked on Day 1. The daily cutoff for locking is 500 000 KCS, with a limit of 10 000 KCS per person. KuCoin raised the total to 1 000 000 KCS for Day 1 – which is about the best that they could do at short notice without unfairly disadvantaging those who had been waiting. TAKE NOTE: the 1 000 000 KCS limit was reached well before the 10 minute mark! In fact it took only 6 minutes and 6 seconds before the limit was reached – despite it having been doubled.

What to do and what to expect:

There were not a lot of explanatory posts about the KCS lockup process before it happened. I know of only two that KuCoin released themselves. Because of this, I had a few unanswered questions at lockup time – things I was unsure of. I decided to write this post to try to help you with any questions that you may have about the process, and to guide you through those bits of it which are not immediately obvious.

Firstly – the address to use for the lockup is exactly what they say in their blog post: LOCKKCS. “LOCKKCS” is what you type into the “Wallet Address” field (as seen in the image below).

Note: If you type this in before the contract is open, you will see an error message “Contain invalid or sensitive information”. Don’t worry, this is normal. Just wait for the contract to activate at 16:00 UTC. If you try to lockup once the contract is already full (500 000 tokens have already been staked for the day) then you will see the same error message.

Trying to transact when the contract is closed will look something like this:

From www.kucoin.com ; modified by Bit Brain

 

 

Once the contract is open, refresh the page and the error message should be gone. Remember that you must lock a minimum of 200 KCS at a time. Also remember that KuCoin has a lot of checks and balances when you withdraw (depending on your account security settings). For me this meant the usual ritual of keying in my KuCoin trading code, my 2FA code and a code which is emailed to me. Don’t forget about all that, it adds at least 30 seconds onto your precious time, so be prepared before the contract goes live: have your apps and webpages open and get ready to type/click fast and accurately. In reality, you probably have at least 5 minutes in which to to this – a time which should grow longer each day.

If you manage to beat the rush and lock successfully, then you will see that you have an “in progress” transaction in the “Withdrawal history” section at the bottom of the page.

Additional Information:

The “Remark” section caught me a little off guard. With less than a minute to go before unlocking, somebody on Telegram asked about using referral codes for the lockup (as was briefly mentioned in a KuCoin blog post). With literally seconds before the lockup went live, an admin replied that you put the referral codes in the remarks field. Having no other referral code at hand, and not knowing whether it was mandatory or not, and with the admin already swamped with questions, I hurriedly put my own code in the field, just to ensure that all fields were complete and that my transaction wouldn’t get automatically declined and miss the lockup.

No, I’m pretty sure that you can’t self-refer and that I won’t score anything extra by doing this! 😂

I honestly do not know for sure if a referral code is mandatory, I highly doubt that it is. If you want to be a nice person, please use my referral code for locking. I will get extra lockup rewards if you do (which I could really use!). You type it into the “Remark” block. My referral code is E39MoQ

After the problems of the first round, APIs will no longer be able to conduct lockups. Aside from causing problems with the contract, according to https://twitter.com/KuCoinUpdates:

To ensure a fair and equitable KCS lockup program for all of our users, KuCoin will prohibit the use of API to withdraw KCS to the LOCKKCS lockup address. This has taken effect immediately and will continue through the end of the lockup period.

It’s a good decision – it’s fair and it was suggested by a large number of users on Telegram when the first lockup stalled.

Be aware that after you have locked your tokens, you will no longer see them in your KuCoin account. Don’t panic, they will be back (automatically) in three months time – with interest! Also, there is no Lockup Dashboard yet, the only indication of your lockup at this stage is your withdrawal history. Similarly, do not panic if you click on the Etherscan link to your lockup transaction and you see something funny. After lockup your withdrawal page should look something like this:

From www.kucoin.com ; modified by Bit Brain

 

 

If you click “view transaction” (as highlighted above) you will see a message such as this one:

From https://etherscan.io

 

 

That is perfectly normal. The LOCKKCS address is not a regular Ethereum address, it is an internal KuCoin construct. The transaction does not go onto the Ethereum blockchain and will not appear there, so Etherscan is supposed to return an error message. This was confirmed by KuCoin technical staff and the Etherscan screenshot above is from my own lockup transaction.

Note that despite the double allowance, only 286 people managed to lock in round one, I therefore consider myself to be extremely lucky! However, if you missed out, then don’t worry! The rate you can get by locking today is only very slightly less, you’ll still score about a 10% ROI within only three months by locking your tokens! The average amount of KCS locked per person yesterday was 3521 – which I consider to be quite a lot (certainly way more than I own!) With amounts like that being deposited, don’t expect the contract to stay open for long for at least the first few days of locking. I tell you again: be ready and waiting on the dot of 16:00 UTC!

Conclusion:

Despite the teething issues, I want to say well done to KuCoin. I think they did a damn good job of handling the API issue in a rapid, fair and responsible manner – about the best they could have done under the circumstances. I don’t blame them for the issue either, it would have been nice if it had been picked up before the time and prevented, but that’s very easy for me to say after the fact, and hindsight is always 20/20. Just as I think Binance handled their hack very well, it’s good to see the intelligent and levelled-headed folk at KuCoin able to do the same under pressure. Such incidents are potential PR disasters if not handled correctly. I don’t see how KuCoin could have handled it any better, their Tweet on my own Twitter wall being a prime example of the lengths they went to to inform and to ease tensions.

Well done (again) KuCoin!

In other news: I have recently heard that KuCoin are busy with a “dust” feature such as Binance has (great idea in the first place – well done Binance!) whereby small balances of other tokens held on KuCoin will be able to get “dusted” into KuCoin Shares. It should be released with their next platform update, I look forward to this!

Also, for those of you amateur videographers out there, KuCoin is running a video creation competition with 50 KCS up for grabs. Check their Twitter feed for the link.

Out of interest: I decided to shift my small Tron holdings from Binance to KuCoin two days ago. I’m pleased to report that the fully automatic staking contract is working and that I have already earned my first daily “soft staking” rewards.

Now if KuCoin could kindly please stop releasing awesome features all the time, then perhaps I could go a week without blogging about them! That would make a nice change! 😜

Yours in crypto
Bit Brain

Featured image from https://twitter.com/KuCoinUpdates

“The secret to success: find out where people are going and get there first” 

~ Mark Twain

“Crypto does not require institutional investment to succeed; institutions require crypto investments to remain successful” 

~ Bit Brain

Bit Brain recommends:

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Don’t miss this one!

 

Yesterday I bought myself (another) 75 KuCoin Shares (KCS).

Yes, I know that my previous post was all about the KuCoin Exchange (The Best Crypto Exchange just got Even Better! (Again)). I apologise for the lack of variety, but this is important and time is of the essence! Similarly, I can’t just write another “Shopping Cart” post and risk you missing this important buy!

I bought those 75 KuCoin Shares (trading STEEM and Ethereum for them) in order to be able to take part in the latest KuCoin programme. Of course they only released this information after my last post – Murphy’s Law at work once again!

So what is the latest KuCoin programme (as if they haven’t already launched enough new initiatives this month already!)?

This is it:

From https://www.kucoin.com/news/en-kucoin-will-launch-the-kcs-lockup-cash-back-program-and-burn-plan

 

 

Of course, if you follow me on Twitter, then you probably already know this:

From https://twitter.com/brain_bit

 

 

If you have a Twitter account and you don’t want to follow me… then, well, I guess I’m sorry – I don’t know how to cure “stupid”.

What is the KuCoin Lockup Plan?

The lockup plan is a three-month lockup of KuCoin Shares on the KuCoin exchange. In other words, it’s a staking contract. The more you stake, the more you can earn. Importantly, the sooner you stake, the more you can earn too. And that’s where it gets impressive:

Recently I staked my WAX coins on their new native (EOS-cloned) blockchain. Returns on that contract amount to 100% over a period of 3 years, which I think is very good! But the KuCoin figures are even better: returns are far higher, working out to a rate which equates to an estimated annual ROI of 50%. Over the three-month period of their staking contract, that works out to just over a 10% return. Not bad for three months, especially with no work involved! That is, quiet simply, the best staking contract I know of in crypto. By far. Yeah you could also get those sort of returns by running the right crypto masternode, but that would probably be considerably more risky – and possibly a lot more expensive.

To get into the KuCoin Staking contract you will need a minimum of 200 KCS. The news of this opportunity caused a price rise in KCS, the tokens have gone up from around $1.30 each to around $1.60. Thus (at time of writing) it will cost you a minimum of $320 to get into the programme – which isn’t cheap, but I consider it to be well worth it if you have the money available! There is a good chance that prices may drop after the staking contract closes, but I really don’t care: KCS is a long-term hold and will no doubt shoot up in price as the platform gets busier (As it has before – to an ATH of $20.17).

Set your alarms:

The lockup plan works as follows: it runs for the month of August, but those who lockup first stand to score the most. Estimated returns start at an annual rate of 50%, but then drop off by 0.5% every day thereafter, so you want to lockup on day one! The staking contract opens on 1 August (I assume directly after midnight) and the time zone used for that is UTC +8. In other words, the contract opens at 16:00 UTC on 31 July, at least I think it does.

For the whales out there, there is a maximum daily lockup amount of 10000 KCS. There is another limit that applies to everyone: a maximum of 500 000 KCS can be locked per day, so don’t wait too long! If you do miss day one or two, it isn’t the end of the world, 49% annual ROI on day three is still pretty darn fantastic! Even if you lockup on the final day of the month, the annual ROI rate will still be 35%, which still beats practically any other staking contract! The entire lockup programme will stop if and when 5 000 000 KCS is locked. This could happen in as little as 10 days, or it may not happen at all. Here is an added bonus: however much is locked up in the programme (in total), that same amount of KCS will be burnt in December 2019. KuCoin are burning KCS like wildfire at the moment (check my previous KuCoin post), a trend which seems to be continuing. This is great for KCS holders, especially when they are getting more KCS for free! If 5 000 000 KCS is burnt, that will mean that the total amount of KCS in existence drops by 2.8%! If you prefer to work with circulating amount (which I do not advise), then that percentage rises to 5.6%! Remember: you can always check out the latest information about KCS specifically at the KCS dashboard at  https://kcs.kucoin.com

You don’t have much to lose

For those who fear that KCS price will drop radically during the three-month staking period, take heart: you can cap your USD losses at 10%. This is because KuCoin have built a safety net into the system: they have a guaranteed service that works like this (in their own words):

After the KCS unlocks, KuCoin provides a service for repurchasing the user’s locked KCS at the price of 10% off the average KCS price (USDT price) on the day of the user’s lockup

What this allows you to do is to turn your recently unlocked KCS into USDT a price of 10% less than what it was worth during the lockup period. The programme is thus not only a good way to buildup your crypto holdings, but also a way to hedge against drops in the market! This offer expires 24 hours after unlocking and is only valid as long as you have not traded or moved your KCS.

On the downside, tokens locked into the new programme do not earn the usual daily staking rewards that KuCoin offers to KCS holders. However, those rewards are FAR less than what you stand to gain by participating.

Conclusion

I fully intend to lock up my KCS for this period, and I will do so as soon as I can. For those who don’t hold KCS, I think that the rise in the token price has been minimal and that it is still well worth your time to participate. I truly believe that KCS is an excellent token to hold and that it is greatly undervalued. I also firmly believe that KuCoin is a fantastic exchange. I’ve been using it for nearly two years now and I am 100% happy with it, in fact it often exceeds my expectations!

Following hot on the heels of “Soft Staking”, KuCoin is obviously focusing on staking lately and their offerings in this regard are extremely impressive. I hope they continue in this vein, if they do it should win them many new customers. I do not know what will happen after the three month lockup period ends, I know that your staked KCS will be returned to you, but I don’t know if another programme will follow thereafter, I hope it does! Perhaps it will become an annual event, who knows? At this stage information is still limited. Read the latest of KuCoin’s own articles about the the lockup here:  “KuCoin Will Launch The KCS Lockup & Cash Back Program and Burn Plan”

If you are not a KuCoin user yet, please consider clicking my “KuCoin” banner in my signature and signing up wit my referral link. I get tiny amounts of some of your transaction fees if you do, for which I would be most grateful. While you are at it… remember that Nash goes live next month!

From https://twitter.com/brain_bit

 

 

Nash and its NEX token should become big names in the world of crypto exchanges. After its launch, I see Nash being the best DEX by far, even better than Binance DEX. Initially trading pairs will be limited, but that will change with time. The highly advanced Nash platform and the myriad added features should make it extremely attractive to investors and crypto traders alike. I have built up a relatively big stack of NEX which I am hoarding jealously. I strongly recommend that you look into NEX if you have not already done so.

In the meantime, why not sign up so long? Once again, I have a referral link in my signature. You HAVE to use a referral link to sign up – there is no option to sign up without one. This is designed into the system to help spread the word. The referral link gives you entry into a competition: you can win BTC and NEX by signing up. The lucky draw is at the end of the year, and the more people you refer with your own code (that you will get after signing up), the more entries you get into the competition. I have never been this excited about the launch of an exchange before!

Yours in great crypto exchanges
Bit Brain

Attribution: Featured image from https://www.kucoin.com/news/en-kucoin-will-launch-the-kcs-lockup-cash-back-program-and-burn-plan

Yours in crypto

Bit Brain

“The secret to success: find out where people are going and get there first” 

~ Mark Twain

“Crypto does not require institutional investment to succeed; institutions require crypto investments to remain successful” 

~ Bit Brain

Bit Brain recommends:

Crypto Exchanges:





The Best Crypto Exchange just got Even Better! (Again)

It wasn’t long ago that I last spoke about KuCoin. It was earlier this month in fact, in the post 💰 Shilling my Bags! 💰. Well, here I am speaking about KuCoin again!

As my readers should know by now, KuCoin is my favourite exchange – not as big as Binance (which I also love), but just a little more friendly and nicer to use. KuCoin also continues to score extremely well compared to all other exchanges in terms of honesty and trustworthiness. So what has KuCoin been up to this time, that Bit Brain deems it necessary to write about KuCoin yet again?

Soft Staking

That’s what KuCoin has been up to.

No, it has nothing to do with serving steaks rare. (Unfortunately)

“Soft Staking” is a new KuCoin development.

https://blog.kucoin.com/what-is-soft-staking-kucoins-new-staking-program/

Leading the industry (once again), KuCoin. KuCoin has come up with a way for you to stake your coins/tokens; by doing nothing.

That’s right; you do absolutely nothing. All you have to do is hold your crypto on KuCoin exchange, and *Hey Pesto!*, it’s staked!

Soft-staking is a logical continuation of KuCoin development: Since 2017 KuCoin Shares (KCS) holders have been able to receive “dividends” based on the number of KCS they hold on KuCoin Exchange. Dividends are based on trading fees earned from all trading pairs on the platform (there are hundreds of them). At first those dividends were paid in all the different currencies traded, but then KuCoin simplified it and now dividends are all paid in KCS (which works better). So “soft staking” is not really new to KuCoin, but it’s never before been done with currencies other than KCS.

You see, the great thing about Soft Staking as opposed to normal staking is that your funds remain available to you even though they are staked! You can withdraw your tokens any time! To re-stake, you just deposit them again!

The following coins can now be Soft Staked merely by holding them in your wallet on KuCoin Exchange:

  • EOS (EOS)
  • Tron (TRX)
  • Cosmos (ATOM)
  • Neblio (NEBL)
  • TomoChain (TOMO)
  • DeepOnion (ONION)
  • NULS (NULS)
  • Energi (NRG)
  • Internet of Services (IOST)

Of course KCS will also continue to function as it always has. To my knowledge, this system is practically unique. I know that Poloniex recently started allowing Cosmos staking, but I can’t think of any other offhand examples by reputable exchanges. In his blog post “Soft Staking: High-yield and Anytime-withdrawal? Yes, You May.” (link below), Johnny Lyu – KuCoin Co-founder and VP, states that KuCoin ROI will exceed that offered by Poloniex:

…some projects in our Soft Staking Program are able to offer 6% to 12% of the annualized return rate, while Poloniex offers 3% to 10% return rate within a similar package.

Staking ROI varies depending on the coin and on the markets, so one can’t assign a fixed percentage to anticipated ROI. But from the information we have so far; NRG looks most profitable (with annual returns estimated at about 20%) and EOS least profitable (with annual returns of about 0.5%). I expect those figures to vary wildly over time. A table of available figures so far can be found in this post: https://www.kucoin.com/news/en-soft-staking-cash-back-investment-program

While I’m linking to KuCoin posts, here are some others you can use to find out more about KuCoin’s Soft Staking:

Within those links you can find more links to specific staking data about each coin (though they are all pretty much the same). Take note of some details, such as that you might not be able to withdraw all your EOS immediately. There is no detailed public explanation about how the staking system works from a technical point of view – at least not yet. Fortunately for you, you have me to guess the details for you:

I am guessing that KuCoin pool all of the deposits and then stake them as a pool, or as a series of small pools, probably of varying sizes. In addition to that, they probably keep an unstaked, liquid portion of tokens available, I’m guessing about 2% of the total deposits of each coin. To me this would make sense because it means that roughly 98% of the tokens would be staked at any one time. As additional tokens are required, they could be unstaked if required – without having to unstake the entire balance of those staked tokens. A fair amount of tokens would always be available for withdrawals in the form of the 2% reserve. Because tokens like EOS take several days to unstake, I am guessing that this is why they say that it is possible that you could sometimes have to wait a bit to withdraw all your tokens, though I doubt that this would ever even happen to the average user. Such a situation would occur if customers had made an unusually large number of withdrawals recently and had depleted the 2% currency reserve. In essence the stakes act as a cold wallets. Where exchanges normally keep about 98% of their crypto holdings offline in a cold wallet (at least the good ones do), now KuCoin is basically just staking their cold wallets. I repeat: this paragraph is entirely just my educated opinion (which is almost always 100% correct, because I am an ultra-genius).

From https://blog.kucoin.com/passive-income-with-cryptocurrency-proof-of-stake/

Depending on the sort of returns you will be getting, staking may or may not be a good idea for you. Like all centralised exchanges, KuCoin has withdrawal fees. Most cryptocurrencies also cost money to send from a wallet to an exchange (unlike NEO which is freedamn that coin is good! 😉 ). For these reasons, sending small amounts of tokens to KuCoin just to be able to stake them is probably a bad idea, you would lose more in fees than what you would gain from staking. Similarly, sending coins to KuCoin for a very short staking period is probably not economically feasible.

On the other hand, if you have a large balance of a coins such as TRX that you want staked, then KuCoin is worthy of consideration.

Of course there is a drawback: you’ll be keeping your coins on an exchange. You all know the saying: “Not your private keys, not your crypto”. As much as I trust KuCoin and I don’t see them running off with anybody’s money, exchanges do have “incidents” – much like the Binance hack in May of this year. I honestly do not know what sort of customer protection measures KuCoin has in place to defend against such events (I would be very interested to know! Perhaps I should write to them and ask…), so I can’t really comment on exactly how safe your coins are when they are staked through KuCoin.

Personally I need to go and look at my own coins to decide if this is worth doing or not. I hold EOS, TRX and NEBL, two of which are already kept on an exchange because I only hold relatively small amounts of them. My EOS is in a wallet, but I’m hardly an EOS whale either. Above a certain USD value I take my coins off an exchange and put them in a wallet, all three of my coins are well below that value (thanks in no small part to the terrible altcoin market we are in!) However, my KCS is over my USD limit, and I leave it all on KuCoin – just to earn the KCS rewards. Read into that what you will.

Conclusion

Well done to KuCoin for offering their customers another great service. This has been a fantastic month from KuCoin: Extra token burns, an OTC trading desk, a Derivatives Trading platform (KuMEX) and now Soft Staking! As I have been saying for years: KuCoin Shares is a damn good token to hold, this platform has a lot of growing to do!

I think that this is only the beginning. I foresee many other exchanges following suit – just as they copied KuCoin’s original dividend paying token idea (COSS doesn’t count because their token crashed and burned, I hate that exchange after the huge losses they cost me!). Bear in mind that if you reside in a country where “Liberty” is only a word and had no true meaning, then the tyrants who unilaterally rule your life may have deemed it illegal for you to earn such staking rewards. Fight them, flee them – or continue to suffer beneath them – your choice.

Yours in crypto
Bit Brain

“The secret to success: find out where people are going and get there first”
~ Mark Twain

“Crypto does not require institutional investment to succeed; institutions require crypto investments to remain successful”
~ Bit Brain

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Cryptocurrency Quarterly Report

 

CoinGecko released its cryptocurrency quarterly report a few days ago. If you don’t know what CoinGecko is yet, then head over to https://www.coingecko.com/en and take a look. CoinGecko is what I consider to be the best of the cryptocurrency tracking websites, and it is a site which I visit (too) many times every day.

The folks at CoinGecko publish a Quarterly Report on the crypto world. It’s a highly informative document: as the name suggests it focuses on the previous quarter, though it does go back further than that where necessary.

I like the reports as they provide a broad overview of the cryptospace. With so many coins, projects, stories and developments in the crypto world, we are forced to somewhat narrow our focus and we tend to suffer from tunnel-vision. I know this happens because I actively try to maintain a broad knowledge of crypto by researching it and reading the latest news each day; but even so I know that projects or events can slip by me unnoticed. The CoinGecko reports are a way to ensure that you haven’t missed out on the most important developments of the quarter.

But the reports are far more than just a news stream, in fact they aren’t a news stream at all. They consolidate the most important information, normally into a graphical format, and then publish it on charts or infographics. This makes everything simple to read and not too laborious.

Let me show you some of what you can find in their latest report. All screenshots below are taken from the “CoinGecko Quarterly Report for Q2 2019”, available at https://assets.coingecko.com/reports/2019-Q2-Report/CoinGecko-2019-Q2-Report.pdf. All rights to the contents of these screenshots belong to CoinGecko, and I share this information under authority expressly granted to be me by CoinGecko via Twitter.

Introduction to the Q2 2019 Crypto Report:

The hype and FOMO are real! Strap on and enjoy this journey; let’s see how far we can fly on this rocket
ship. We hope this report brings you value and helps you stay updated on the constantly changing
cryptocurrency industry.

~ Bobby Ong and TM Lee – Co-Founders of CoinGecko; “Founders’ Notes”; Pg 4

If you’re anything like me, then you like to take a look at long-term chart trends. You CAN work these out mathematically be means of insanely complex MS Excel formulas. I used to do that when I started in crypto, but honestly the effort of maintaining those spreadsheets is not worth the benefits. These days I eyeball trendlines, but confirmation like this from CoinGecko can be used to ensure that my eyeballs are not skew. 😃

 

Note how the trendlines are not only upwards sloping, but are upwards curved; indicative not only of growth, but of logarithmic growth (and now you know why I normally use log charts for crypto analysis).

The top coins feature prominently in the report, here CoinGecko gives us their quarterly performance. (*Sarcastic voice* “Oh no, XRP is being left behind, how sad!”)

 

This is a nice one, it shows you how the top 30 coin rankings have changed since the last quarterly report. CoinGecko started publishing regular Quarterly Reports in 2018, prior to that they published two reports in 2017: a Q3 one and an annual one. All their reports are available here: https://reports.coingecko.com/all-reports. Depending on which report it is, some of the reports are available not only in English, but also in Vietnamese, Korean, Japanese, Russian, Chinese and Indonesian! Personally I think that’s pretty impressive!

 

As an analyst, I love this chart. To me this says one thing: Bitcoin is climbing back up WITHOUT even experiencing any hype yet! CoinGecko obviously interpret it the same way I do, look at the two sections which  they have circled…

 

Exchanges feature prominently in the report, just look at how their numbers are growing. There is far more to see in the report itself!

 

Binance in particular gets a lot of focus (unsurprisingly). This page is about its May 2019 hack. There is also a three page sub-section about Binance DEX – all nicely concise and well laid out in an easily readable fashion.

 

I’ve written about the CoinGecko Trust Score before, a feature which I consider to be very good. In case you missed my review of it, don’t fret, you can get it from the horse’s mouth.

 

Another topic which I have written about: (the dreaded) Libra. In addition to the page below, CoinGecko also summarise its whitepaper – great for those who are too lazy (I mean “too busy”) to read it! In all seriousness, I did read the Libra whitepaper and I found it to be nothing more than propaganda and marketing of a centralised pseudo-crypto, but let’s not talk about that now. CoinGecko also capture the various government responses to Libra (so far).

 

IEOs have been very popular this year. I don’t really like this fancy new buzzword (buzz-abbreviation?) for what are really nothing more than ICOs launched by an exchange, but I do like the CoinGecko analysis of them. In a five-page spread, they give a breakdown of the recent IEOs: splitting them by month, exchange (as seen below), amount raised, ROI by project and ROI by exchange. I’m sure you will agree that that is very useful information for a crypto investor to have!

 

There are also sections on the Lightning Network…

 

…and DApps

 

Conclusion

Note that I have not even shown you 20% of what this 45-page report has to offer. It’s long enough to be useful and complete, but short enough not to make you bored or to waste your time. I consider this report to be a job (very) well done and I congratulate CoinGecko on delivering another excellent product. I thoroughly recommend the report to the crypto community. Remember that Bit Brain is not affiliated with CoinGecko in any way, I get no direct benefit for writing this post. As usual, I’m just trying to bring you the best crypto information that I can, information which CoinGecko is good at supplying.

Don’t miss the final page of the report (unless you count “The End” as a page), it contains links to all of CoinGecko’s many social media channels. I follow them on STEEM and Twitter, and of course I use their website, but there are many other options available to those of you who prefer other social media channels or phone apps.

Yours in crypto (which you can find on CoinGecko)

Bit Brain

Cover image from https://assets.coingecko.com/reports/2019-Q2-Report/CoinGecko-2019-Q2-Report.pdf

“The secret to success: find out where people are going and get there first” 

~ Mark Twain

“Crypto does not require institutional investment to succeed; institutions require crypto investments to remain successful” 

~ Bit Brain

Bit Brain recommends:

Crypto Exchanges:





Bitcoin – possible next moves

 

Bitcoin continues to tread water – with gradual negative changes to its buoyancy

Here is what I think may be happening now, and what may happen next.

As BTC is clearly no longer rising in price, I have abandoned my bullish channel diagonal Fib levels and have replaced them with downwards sloping diagonal Fib retracement levels.

 

Viewed in the medium-term, the new levels look like this:

 

Seeing the above chart, my immediate thought was that BTC may be forming a bull flag. If it is a bull flag, then the most likely next move would be for BTC to break upwards out of the flag and to continue rising on the previous trajectory. This is not to say that BTC will not dip further before that happens.

 

My confidence factor wrt the bull flag scenario is not extremely high, it’s more a possibility than a probability. I place a likelihood of 40% on it being a bull flag. Because of this I would be cautious in trading it as a traditional bull flag – not that I trade BTC anyway, because I’m a hodler by nature.

Bull flag or not, BTC is dipping at the moment. While the drop in price may be arrested sooner, the new diagonal Fib levels indicate a possible bottom at around $8800. Remember that the Fib levels are sloping downwards, so if BTC dips later than expected, or if it dips again after that, then $8800 will no longer be the bottom of the dip. If BTC were to dip again in August, it would only find support in the $8500 – $8000 region.

 

Another thing I can’t help noticing is the similarity between this price movement, and that of various BTC price movements in 2017. Here is what BTC looks like now:

 

And here are similar BTC patterns from 2017:

 

…and similar patterns from earlier times too.

 

The important take away message from this is that this pattern is invariably seen during bull markets and usually precedes a price climb – before it reoccurs.

Summary:

I can’t tell what BTC will do next, but I am expecting a dip. After the dip there may well be another dip, or even multiple dips before BTC climbs again. It looks as if BTC will resumes its climb after the upcoming dips.

I think we are seeing a consolidation period, a time when weak hands are selling their 2019 gains and stronger hands are replacing the weak ones every time the price dips. Once this transfer process has completed, strong hands should dominate and the climb should resume.

I still think that 2019 bullishness kicked in too soon. The 2018 bear market is still fresh in the memories (and on the charts) of most investors: a reminder to be cautious. This is causing the price rise to be a case of “two steps forward, one step back” which is probably a healthier way to climb than an all out run to new highs. Consolidation makes a climb more sustainable, less volatile and less likely to lead to a big crash at the end of the climb – so it’s a good thing for investors.

Even though I am out of spending money, if BTC dips into the $8000s, I will consider using some of my fiat savings to buy more. This reasons for this are twofold:

  1. BTC has become more legitimate than I expected, sooner than I expected. It features prominently in mainsteam media and is often commented on by world leaders. Whether the press is in favour of it or against it, the exposure is good for BTC and the man in the street is starting to view it as a real contender/threat to fiat money.
  2. My faith in fiat diminishes by the day. Unfortunately, the majority of my saving are still in fiat. I am actively seeking good stores-of-value to place some of my fiat savings into. Crypto is risky, so one must be very careful about shifting money into crypto, but if I am going to be taking money out of fiat, then I might as well put a little more of that money into crypto. The rest will probably go into precious metals, I’m still busy deciding and watching the markets closely.
 
 

Yours in crypto

Bit Brain

“The secret to success: find out where people are going and get there first” 

~ Mark Twain

“Crypto does not require institutional investment to succeed; institutions require crypto investments to remain successful” 

~ Bit Brain

Bit Brain recommends:

Crypto Exchanges: