CRYPTO ETHEREUM BITCOIN BLOCKCHAIN ALTCOINS EVENTS ICO

CRYPTO ETHEREUM BITCOIN BLOCKCHAIN ALTCOINS EVENTS ICO

The growth of Bitcoin price on Monday was stopped by the news that South Korean regulators would check the bank accounts of the local cryptocurrency exchanges within the countermeasures for money laundering and terrorism financing.

Bitcoin’s Recovery Has Stopped
Despite the loss of the sufficient part of the market as a result of the mass growth of altcoins, Bitcoin managed to grow in price during the first week of the new year. On Saturday, the rate increased to $17 762 (according to coinmarketcap.com), and this was the highest number in the last two weeks (from December, 21). Cryptocurrency increment made up $4000 from the beginning of the year.

However, soon after reaching the level, Bitcoin plummeted to the minimum $14200/BTC (at the time of writing).

South Korea Inspects Bank Accounts of Cryptocurrency Exchanges
The fall is at least partially connected with the report, provided by the local media resource Yonhap, on the planned “intensive soundings” of the bank accounts, owned by the South Korean cryptocurrency exchanges.

The audits are held by the Financial Services Commission (FSC). They aim at checking whether the banks stick to the policy of money laundering opposition during the work with the local Bitcoin exchanges. Korean banks keep around 2 trillion of KRW or 1.8 billion USD that belong to the cryptocurrency exchanges.

Regulators strive to narrow down the inflow of the fiat currencies to the Korean exchanges and cool down the overheated cryptocurrency markets that often value coins and tokens significantly higher than the average world prices are.

Traders frankly worry that regulators would find something during their audit, and how they would react to the inappropriate accounts. Korean officials do not exclude the possibility of closing of the cryptocurrency exchanges in the future if they fail to yield to the regulators. The events are likely to cause a week of high turbulence on the market during which the traders will wait for the official statement.

The Korean uncertainty minimizes the significance of other announcements that could have provoked the growth of price. In particular, the New York Securities Exchange (NYSE) has applied for the adding of the Bitcoin Exchange-Traded Fund (ETF) to the listing of its trading platform Arca. It would strengthen the position of the cryptocurrencies as a primary class of assets.

The decision on the audit of the South Korean exchanges’ accounts touched not only Bitcoin but also altcoin market. All altcoins, together with the leading cryptocurrency, experienced the mass price fall, though some of them have already started to recover.

The year that is coming to an end in a few hours has become a prominent one for the first cryptocurrency. Some call it a basis for the new economic model, and others – the most prominent financial bubble in the history.

In this article, we are going to dive into history and examine some of the most significant moments of the year, when the price has been growing from less than $1000 to the highest mark of $20 000.

It was a year that exceeded the most daring forecasts. Could anyone, especially financial experts, even guess such a growth in mere 12 months?

China and PBoC, Round One
After the symbolic mark of $1000/BTC at the beginning of the year, and then a local maximum of $1165/BTC, Bitcoin stopped its rapid growth due to the following events. The biggest at that time Bitcoin market was imposed to some regulatory restrictions. At first, due to the lack of information, the restrictions had caused panic, and the price of cryptocurrency dropped to $800. The Public Bank of China (PBoC) had started the audit of the Chinese cryptocurrency exchanges because of the money laundering suspicions. The inspection resulted in the prohibition of margin trading on those platforms. After that, Bitcoin price grew and exceeded $1000 once again.

The next stroke the PBoC delivered as soon as February when it decided to tighten the control over the dominating Bitcoin exchanges, the so-called Chinese “Big 3” – BTCC, OKCoin, and Huobi. The bank announced its recommendations on the risks of cryptocurrency investments and expressed concern about the attempts to circumvent restrictions of the Yuan withdrawal outside the country. Chinese cryptocurrency exchanges were made to pause the withdrawal of fiat funds until all their users pass the expended KYC verification. Eventually, on June 1, OKCoin, BTCC, and Huobi announced the possibility to withdraw money, and up to autumn, China didn’t influence the global Bitcoin market.

Winklevoss Brothers and Bitcoin ETF
While Chinese exchanges remained in isolation from the global Bitcoin trading, other factors started to influence the price. First, it was the expectation of Bitcoin ETF launching. The first application had been made to the Securities and Exchanges Commission (SEC) by the Winklevoss brothers. SEC was to consider the request for the launching of the Bitcoin exchange-traded fund to the March, 11. Due to that information, the price of Bitcoin started to grow and exceeded the ounce of gold for the first time.

The rush around the event happened before one of the world biggest derivative Bitcoin exchanges announced the launching of the new futures contracts, which would allow traders to place stakes on the SEC decision about the Winklevoss’ application.

Before the Securities and Exchanges Commission announced its decision, the price of Bitcoin had set a new historical maximum of $1350/BTC. When the brothers received a refusal, the rate decreased by almost 30% that day and appeared to be within $1000 again.

Despite the failure of the Winklevoss brothers, several more companies decided to receive the permission for the Bitcoin exchange-traded fund. It was unsuccessful either; particularly, at the end of March, SEC denied SolidX in creating ETF, though it hardly influenced the market.

In winter, when Bitcoin price approached $13 000, Winklevoss twins received their reward by becoming the first Bitcoin billionaires.

Summer: Time to Gain Strength
At the beginning of May, Bitcoin reached $1500/ВТС, and during the month its price doubled.

The primary cause of growth was the signing of the Segregated Witness activation agreement in New York. However, it had a small addition about the further increase of block size to 2 Mb, which caused serious consequences in the future.

Due to the crazy interest to Bitcoin and its increasing value, the record indexes were fixed in the world and particularly on the p2p platform LocalBitcoins in Ukraine.

One of the most exciting events of the summer was the Wall Street analytics entering the game of Bitcoin price prognosis. At the beginning of June, the American billionaire Mark Cuban startled the cryptocurrency fans by his announcement that Bitcoin resembled a “bubble.” However, he said he started to follow it by subscribing to Inside Bitcoin newsletter and recommended doing it to his followers.

Goldman Sachs (one of the biggest investment companies in the world) predicted that Bitcoin, despite a possible deep fall, would continue to grow.

Sheba Jafari, a Head of Technical Strategy Department at Goldman Sachs, had expressed a thought in her message to the clients that Bitcoin price would reach $4000, which soon came true. As for the financial analyst Ronnie Moas, he underestimated the Bitcoin’s potential predicting that its price would grow to $5000 by the end of 2018.

August became a turning point for Bitcoin - two events that caused its further growth took place. On August 1, Bitcoin Cash hard fork took place within the Bitcoin network. The price started to increase since everybody wanted to receive coins out of nowhere because of the split. And on the 24th of September, a Segregated Witness solution was activated, ending up a two-year epic of its implementation.

Bitcoin started to gain more popularity in the world. In Dubai, two business gurus, a baroness Michelle Mone and Douglas Barrowman announced a real estate selling for Bitcoin (about 220 thousand square meters). Also, those who rented apartments in London had now the possibility to pay with Bitcoin. In Kyiv, first six test cryptomats that allowed buying Bitcoin for cash started to work.

China and PBoC, Round Two
At the beginning of September, China appeared in the cryptocurrency news headlines again. The PBoC management stroked cryptocurrency community once again. And though the shot was not directly on Bitcoin, the full restriction of ICO in the country had a significant impact on the cryptocurrency price.

Only a few days after the ICO prohibition, the PBoC targeted Chinese cryptocurrency exchanges: the financial regulator forbade trading to Yuan. Also, the rumors about Bitcoin mining restriction appeared (80% of world mining is concentrated in China); however it didn’t happen. Nevertheless, China lost its previous authority on the Bitcoin market, and the majority of analysts considered it as a favorable event for the cryptocurrency.

Golden Autumn
The middle of October meant the new heights for Bitcoin. Bernstein company analysts, located in New York, stated that Bitcoin was “a class of assets, not liable to the censorship,” but not precisely money.

In the countries with the weakened economics cryptocurrencies gained enormous popularity, and in Venezuela, they helped the locals to survive. Some states imposed fines for using Bitcoin as the means of payment.

When the real evidence that Wall Street was going to enter Bitcoin market had appeared, its price started to rise at the unprecedented pace, exceeding $10 000 by the end of November.

Start of Bitcoin Futures Epoch
In expectation of futures trading, the rate grew at a frantic pace, adding to its price $1000 daily. On December 10, the biggest futures exchange CBOE  started Bitcoin futures trading, which caused the new height of $17 000. The climax for the most popular cryptocurrency took place on December 17, the day before one more derivative exchange, CME, was to launch futures trading. Then, Bitcoin crossed the mark of $20 000.

However, several days after that, December 22, a deep correction was observed on the market, when the price of Bitcoin decreased to less than $13 000. After that, the rate increased to $17 000 for a short period. Today, on the last day of the year, Bitcoin costs around $13 000.

Future Prognosis
The time will show what awaits Bitcoin and other cryptocurrencies. At the moment, the Wall Street cryptocurrency analyst and co-founder of research center DataTrek Nick Colas says that in 2018, Bitcoin can experience critical course jumps, fluctuating between $6500 and $22 000.

Investopedia, the biggest specific resource, devoted to the investing education, called Bitcoin a term of 2017, emphasizing the fact that cryptocurrency had become mainstream in the financial world and the inevitable part of the economic system.

2017 was unequivocally the year of Bitcoin. So what cryptocurrency is going to be the most successful in 2018? Maybe, Ethereum?

Deutsche Bundesbank has announced the testing of the prototype for securities trading, based on blockchain technologies, which is a result of cooperation with Deutsche Börse – market platform that trades securities and other assets. The prototype is not ready for the commercial use yet and remains on the conceptual stage.

Development In Progress
About the existence of this tool the two companies have announced in the press-release of the Deutsche Bundesbank. A prototype was created to support the technical side of securities calculation realization in the DVP regime (Delivery Versus Payment), which assures the simultaneous calculation by means of the use of the centrally released tokens and transparent payments, or use of digital coins or digital assets only.

The Deutsche Bundesbank and Deutsche Börse plan to continue the prototype development during the next few months, after analyzing the technical characteristics of the developed blockchain technologies to understand their scaling possibilities.

Financiers Opinions
Member of the Supervisory Board of Deutsche Bundesbank Carl-Ludwig Thiele commented on a necessity of creating such prototype:

The Deutsche Bundesbank and Deutsche Börse are looking forward to working with blockchain-prototype to understand whether this technology can be used for fulfilling financial operations, and if yes, how it can be reached. Deutsche Bundesbank hopes that this prototype will promote more practical understanding of the blockchain technology to estimate its potential.

Carsten Kengeter, Deutsche Börse AG CEO, added:

Together with Deutsche Bundesbank we innovatively and creatively addressed the development of the potentially radical solution for the financial sector. We will continue to do everything possible to effectively use the potential of blockchain technology and better understand the risks the use of it implies, and minimize them.

Banks and Blockchain
In a report, published on the website of the World Economic Forum, it is stated that more than 90% of central banks are involved in the developments connected with the use of blockchain technologies. For example, recently a Royal Bank of Scotland has developed a system of transnational payments on the basis of Ethereum platform, and National Bank of Ukraine has sounded about its plans to establish a national crypto-currency.

Decentralized technologies should be considered as ones out of many technologies that will serve as a basis of the next generation of financial services infrastructure. Modern business processes will radically change in the nearest future, and the modern economic models will be sufficiently modified.