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Life Without Dollars: A New, Lasting StableCoin Solution is Needed Because the USD Won’t Rule Forever

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Life Without Dollars: A New, Lasting StableCoin Solution is Needed Because the USD Won't Rule Forever

Since the whittling away of the power and stability of the gold standard in, depending on where you’re from (1925 in the UK to 1971 if you’re in the USA) and its replacement with a system of tethered trust in the government responsible for the issuance of the currency (Bank of England – UK and the Federal Reserve for the USA). This is know as the fiat system, and has had its ups and downs in the tumultuous century of the 20th/21st.

While it has been stress tested over this stretch of time, is it a monetary system that can last forever? It’s not looking 100 percent whether we should say yes or no, as there’s been more than a fair number of events that have established the economic uncertainties of this interconnected monetary fiat system, understating the fact that when you ‘float’ an economy on a set price, it’s continued stability is certainly not assured.

Of all the fiat currencies out there, the US Dollar is one of the only currencies that serves as a truly globe-trotting one. Even with this international application and prestige, it is certainly not immune to the shocks of inflation and market boom and bust cycles in light of natural (and less so) disasters, political unrest and upheaval, as well as the eroding international trust in the United States in its potential for repaying debts.

These uncertainties across the world underlines the kind of critical need there is for a digital, international storage of value, as exists with the likes of cryptocurrencies – ones that are decentralized and borderless.

This Age of Potential Catastrophe – Economic Uncertainty Worldwide

As Eric Hobsbawn wrote a number of decades ago, the 20th century was the Age of Extremes. It’s only appropriate that we see the economic landscape of 2008 to now as being one of potential catastrophe.

Uncertainty has grown on a global scale and at a surprising speed. Across the world, we’re seeing extreme issues such as increasing inflation, dragging with it the debts of nations both developed and emerging. And considering these are debts dragged from the recessions of 2008/9 and 2000/1, it doesn’t look like it’s improving anytime soon.

More acute demonstrations of this economic catastrophe in slow motion come from the shrinking economy and frantically increasing inflation (currently 8 million percent). Closer to home (for some) Greece has underwent a series of bailouts from the European Central Bank over a decade, much to the chagrin of the big economies of the union. As a result, the underlying finances of those supporting countries and Greece’s infrastructure are certainly not well off.

Credit-ratings are rolling in the fiscal gutter with no-one there to pick them up. The way things are going at the moment, this will only exacerbate social issues such as increasing levels of racial, ethnic and religious tension all the more worse.

One World – Under the Dollar

With the continued international tumult that has come to symbolize the international economic system creates a greater underlying uncertainty in the collective minds of governments across the world, they’ll also grow increasingly attached to the existing monetary order under the US Dollar.

Out of all the financial currencies in the world, the US Dollar is known as one of the single most stable, but that doesn’t make it exempt from being shaken on occasion. It’s this level of trust that countries have in this currency during times of uncertainty that make it such a reliable tool as a default index across a broad range of international markets. T

There’s an internationally held fiat towards the US Dollar and, by association, the US Economy, with 65 countries pegging their own sovereign currencies with the dollar, or even interchange with the dollar in their daily currency.

With increasing levels of market volatility and inflation for sovereign currencies, this has a knock on effect for the price of goods and services, as they climb in conjunction with inflation. Venezuela, as was previously hit upon, has seen more than one third of is population move either towards the US Dollar, the application of cryptocurrencies in order to get US dollars, or just abandoned currencies altogether for the archaic barter system.

With such an increasing number of economies in jeopardy, dragging their people with them, there is an increasingly dire need for a financial system that is far more stable in the face of an age of catastrophe.

The US Dollar’s Value has Become a Political Battleground for Hegemons

Trust is the imperative, and when it comes to the world of monetary policy and value, the US government needs to operate in such a way as to earn and hold that both domestically and internationally, while also looking out for its economic prerogative wherever necessary.

While some of us may not like it, the government has the biggest and most firm hand in the safeguarding and valuation of the US Dollar, as we’ve seen first hand with Trump putting his interests ahead of others, and professing for a foreign policy of neo-isolationism and protectionism (albeit superficially).

The tax cuts which were proposed by the Trump administration back in 2017 had its sights set on cutting levels for the financial movers of society (the middle class), while also increasing incentives for big businesses to in-source their jobs to America. The unfortunate reality is that this has led to a greater increase in the already burdensome sovereign debt of the United States. And as the level of debt behind it increases, its credit rating is placed in uncertainty, and markets over the world will review the US Dollar less positively.

Stablecoins to the Rescue – An Answer to Market Volatility

What we’ve seen over the course of this long 21st century is the United States economy move away from a Laissez Faire, gold standard-backed economy, to one that has sustained some of the worst economic downturns in human history, with the likes of the Wall Street crash in 1929, and the great recession of 2008.

While these have been trials that the world economic system has stood robustly in the face of. We now run up against a new age of protracted trade war, instigated by the US Republican administration under Trump, whose hard-line approach to bringing work and major industries back the United States is out of keeping with the reasons why they left in the first place.

These ongoing conflicts of trade between the United States, China and Europe all illustrate the kind of need that there is for a decentralized system of global value, which would eradicate the need for an international fiat currency that is walking out of the prestigious limelight and into the 19th century world of protectionism. There needs to be a 22nd century solution for this 21st century problem.

Cryptocurrencies have, in many instances, attempted to redress the protracted crisis of instability with its own fiat-backed virtual currencies called ‘stablecoins.’ Since their first debut, major companies like IBM have been developing the technology necessary in order to introduce a stable coin that can prove price-stable over time.

But, it is when we look closely at the entire landscape of stablecoins that there is a consistent theme that they are pegged too a kind of sovereign currency, which means that whenever the dollar takes a dive, so follows the virtual currency, in spite of our better desires.

So what is to be done? A stable store of value needs to be one that is currency agnostic, and not relying on a sovereign currency in order to assure its long-term value. To create such a thing would be to truly revolutionize the international landscape of the economy, and bring stability to an overtly shaky world.

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PSA: Bitconnect ‘2.0’ Triggers Countdown to Resurrect Greatest Crypto Ponzi Ever

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By CCN: In 2016 a cryptocurrency project named BitConnect came along offering 1% daily compounded interest for those who purchased and staked its token.

When the BitConnect (BCC) bubble inevitably burst, the owners, as expected, made off everyone’s money. The BCC token price sunk by 99.9%, and a previously $2.5 billion valued project became worthless.

Now, the greatest scam ever sold is back. Enter BitConnect 2.0.

Hey, Hey, Hey: BitConnect 2.0 Arrives for a Second Bite at the Cherry

A website and Twitter profile advertising the arrival of BitConnect 2.0 appeared in the last few days. The website shows a countdown to the rebirth of one of the worst cryptocurrency scams of all time.

Bitconnect countdown

The Twitter profile contains just two posts – one is a link to the new website; and the other is a Binance referral link with the directive ‘Buy Now’.

Of course, there are no BitConnect tokens (either 1.0 or 2.0) hosted on Binance. If we take a look at the domain registrar details for the new website – BitConnect.io – we see some strange peculiarities.

Despite the Twitter post promising a July 1st launch, the website’s domain name is set to expire two weeks before that date. The domain, which differs slightly from the original BitConnect.co website, was registered in 2017.

bitconnect domain

Scamception: A Scam Inside a Scam

All of this adds up to what looks like a scam inside a scam. Assuming the site domain isn’t renewed before the expiration on June 19th, then perhaps what we have here isn’t BitConnect 2.0 at all.

Rather, it appears someone with an old domain name is attempting to squeeze as much money out of their Binance referral link as possible before the site expires. The Twitter profile shows almost 1,000 followers already, despite the first post not appearing until one day ago. However, the new website is also registered in the same geographic location as the original – Panama.

One person who was able to see the funny side of the BitConnect revival was former BCC front-man, Carlos Matos. Famous for his exuberant and dramatic on-stage sale pitch, Matos continues to post memes about the BitConnect saga. Recently he revived his infamous ‘Hey, Hey, Hey…’ slogan to comment on BitConnect 2.0; which he apparently has no part in.

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Matos even posted this meme expressing a skeptical take on the project’s revival.

bitconnect grand theft auto meme

Too Late for Skepticism

Ultimately, the same skepticism would have been useful several years ago, before gullible investors were taken for all they had. From the ICO price of $0.17, the value of BCC tokens shot up to $509.99 in one year – marking ridiculous gains of 299,894%.

bitconnect charts

Of course, those gains were never cashed out. When the exit scam hit in January 2018, the value of BCC dropped like a stone. Data for the token price continued to be tracked up until August 2018, when it held a value of just $0.263786, before being removed from all exchanges.

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EOS Price Prediction Today: Daily (EOS) Value Forecast – May 20

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34-Million-EOS-Officially-Burned

34-Million-EOS-Officially-Burned

  • On the upside, if the price is sustained above the EMAs, the bulls are likely to retest or break the $6.60 and $6.80 resistance levels.
  • However, if the bulls fail to break the resistance levels, the crypto’s price is likely to fall back to the range bound zone.

EOS/USD Medium-term Trend: Ranging

  • Resistance levels: $ 6.80, $7.0, $7.20.
  • Support levels: $6.20, $6, $5.80.

Last week the price of EOS was in a bullish trend. On May 16, the crypto’s price tested a high of $6.80 and was resisted. The market fell and was in a downward correction to the support level at $5.80 price level. On May 19, the crypto’s price was in a bullish move but was resisted at the $6.60 price level. The crypto’s price is above the 12-day EMA and the 26-day EMA which indicates that price is likely to rise.

On the upside, if the price is sustained above the EMAs, the bulls are likely to retest or break the $6.50 and $6.80 resistance levels. However, if the bulls fail to break the resistance levels, the crypto’s price is likely to fall back to the range bound zone. Meanwhile, the market is at the overbought region of the daily stochastic but below the 80% which indicates that price is in a bearish momentum and a sell signal.

EOS/USD Short-term Trend: Ranging

On the 1-hour chart, the price of EOS is in a bearish trend zone. On May 19, the crypto’s price reached a high of $6.52 but was resisted. The crypto’s price fell and was in a downward correction. The bears have broken the 0.236, 0382 and the 0.50 Fib. retracement levels.

The price is in a downtrend zone but the 0.618 retracement level is likely to hold. In other words, the price may fall to the $6.19 price level. Meanwhile, the market has reached the oversold region of the daily stochastic but below the 40% range. This indicates that the price of EOS is in a bearish momentum and sell signal.

The views and opinions expressed here do not reflect that of BitcoinExchangeGuide.com and do not constitute financial advice. Always do your own research.

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Bitcoin Has Soared Above Intrinsic Value During Latest Rally, JPM Strategists Claim

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Strategists from United States banking giant JPMorgan Chase (JPM) have argued that bitcoin (BTC)’s recent rally has ostensibly soared past what they calculate to be its intrinsic value. Their analysis was reported by Bloomberg on May 20.

The strategists — who reportedly include JPMorgan global market strategist Nikolaos Panigirtzoglou —  judge that the top coin has recently been trading in a way that mirrors its late 2017 rally, which preceded a protracted price slump.

To ascertain the coin’s intrinsic value, the strategists reportedly analyzed bitcoin as a commodity and calculated its cost of production based on parameters such as estimated computational power, electricity costs and hardware energy efficiency, Bloomberg notes. They reportedly stated:

“Over the past few days, the actual price has moved sharply over marginal cost. This divergence between actual and intrinsic values carries some echoes of the spike higher in late 2017, and at the time this divergence was resolved mostly by a reduction in actual prices.”

Bitcoin — which has seen a renewed lease of life since April — has traded as high as almost $8,300 within the last week — having traded sideways below $5,000 throughout February and March. In mid-December 2018, the top coin had traded below the $3,300 mark — with its current price point thus representing a roughly 150% gain over its bear market lows.

Bitcoin’s 3-month chart, Feb. 20 — May 20 2019

Bitcoin’s 3-month chart, Feb. 20 — May 20 2019. Source: CoinMarketCap

In an apparent qualification of their analysis, JPMorgan’s strategist are cited by Bloomberg as having noted that:

“Defining an intrinsic or fair value for any cryptocurrency is clearly challenging. Indeed, views range from some researchers arguing that it has no fundamental value, to others estimating fair values well in excess of current prices.”

As reported, JPMorgan CEO Jamie Dimon has long adopted a sceptical stance toward decentralized cryptocurrencies such as bitcoin, even as he steers the megabank toward launching its own blockchain-powered native settlement digital asset, JPM Coin.

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Ethereum-Based Stock Exchange Plans First Company Listing in June

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SprinkleXchange, a stock exchange built on ethereum, is reportedly listing its first company next month.

Sprinkle Group CEO Alexander Wallin told Bloomberg in an interview published Friday, “We have the luxury of being first with this, but we’re aware that it will become a crowded market.”

The Bahrain-based platform, operating within a regulatory sandbox created by the country’s central bank, uses a decentralized clearing and settlement system that uses automation in order to reduce time and cost. Prices will be set using the Dutch auction method, with SprinkleXchange taking a 1 percent fee.

Wallin told the news source that the cost of listing would be similar to on a Swedish stock exchange, but “you get global access and we can show that you also get better liquidity.”

SprinkleXchange is aiming to attract companies with a market capitalization of $20-$200 million. It expects to list 35 companies over the next 12 months and as many as 1,000 over the next few years. As well as listed stocks, the firm will offer trading in cryptocurrencies and also plans to add exchange-traded funds in the future.

A number of traditional stock exchanges are currently moving to integrate blockchain tech in their platforms. Switzerland’s top stock exchange, SIX, for instance, is expected to roll out a blockchain platform to speed up trading later this year. While the Gibraltar Stock Exchange recently started allowing the listing of tokenized securities.

The Australian Securities Exchange is notably rebuilding its ageing CHESS settlement platform using blockchain tech provided by Digital Asset. And other stock exchanges, including in Jamaica, Thailand and Spain, have also announced initiatives around blockchain and crypto assets.

Bahrain image via Shutterstock 

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Terrified Central Bank Attempts to Arrest Myanmar’s Bitcoin Binge

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By CCN: An emerging economy which expects to attract $5.8 billion worth of Foreign Direct Investments is belittling its goals with an anti-technology stance.

Myanmar is the latest developing country that is hinting to shut doors in the face of bitcoin, a decade-old global cryptocurrency which proposes to replace banks with a decentralized network of transaction validators and bookkeepers. Anybody with a decent internet connection can participate in the bitcoin economy, which further makes it an attractive asset for people with limited gateways to participate in global economies.

But, to the Central Bank of Myanmar (CBM), bitcoin is more a liability than an opportunity. The central bank earlier this month announced that it does not recognize bitcoin as money, stating that it would not allow Myanmarese financial institutions to accept or facilitate its transactions. The same ruling applied to cryptocurrencies having properties as that of bitcoin.

Bitcoin Adoption Booming in Myanmar

MMTimes.com reports that Myanmarese investors have been increasing their stakes in bitcoin and similar cryptocurrencies lately. Local advertising for bitcoin exchanges on social media is at its peak, which is prompting more people to board the bitcoin bandwagon. CBM fears that the process might shift a considerable capital from Myanmar’s own markets to an industry that is not theirs, which is why the central bank is discouraging people from investing in or using bitcoin and similar cryptocurrencies.

U Aung Aung, an IT professional working at a multination company in Yangon, told MMTimes that Myanmarese people like him face huge restriction on banking. He admitted purchasing some $20 worth of BTC back in 2017 after finding the cryptocurrency appealing for conducting flawless ‘global e-commerce and aid.”

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There are millions of people like Aung in the world that have entered the bitcoin economy for its underlying technological potential. The frenzy went to its peak during December 2017, when the bitcoin market valuation jumped to as high as $313.89 billion, almost five times the current GDP of Myanmar. A massive downside correction in 2018 brought the bitcoin rates almost 85-percent down. Nevertheless, the market now stands near $144 billion owing to an increase in institutional interest in first-tier countries like the US, Singapore, Japan, and Switzerland.

The Choice Between Doing an India or a Japan

CBM is now left with two options: either it can restrict people from investing in bitcoin like the Reserve Bank of India did, or it can take a proactive approach like Japan or Switzerland to make Myanmar a global hub for bitcoin-related developments.

U Nyein Chan Soe Win, the chief executive of digital commerce platform Get Myanmar, CBM does not have constitutional backing to announce an outright ban on cryptocurrencies. It is likely for the lawmakers to first define bitcoin in legal books before pursuing action against or in favor of the cryptocurrency.

“Before making crypto illegal, its impact on the local currency and compatibility with existing policies should first be analyzed and discussed,” he told MMTimes.com.

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