Saturday, 19 August 2017

The digital currencies race in the first half of the year has been won by Ripple as its token, XRP that has finished the second financial quarter priced at $0.26, up 3,977 percent year-to-date. At the moment it has dropped to around $0.19, but its growth still seems impressive.

Ripple has boomed across the cryptocurrency marketplace as it recorded $30 mln in new transactions in the second quarter of this year alone, as well as saw the token listed on 25 new exchanges. It also boasts the third-largest market capitalization in the space — behind Bitcoin and Ether.

Partnerships

XRP is different to a few of the other main players in the digital currency space as it is owned largely by Ripple. When the company announced in May that it had plans to structure the sale of its currency the interest spiked.

Miguel Vias, Ripple's head of XRP markets explains:

“With respect to XRP, we are incredibly focused on international payments, I think we are probably the only digital asset that has a clear use case with respect to what we are trying to do with the asset."

As for the future, Vias hinted that new announcements may be forthcoming. Vias told CNBC:

"In this quarter, you will see some very interesting developments with respect to our partnership in payments, with respect to XRP in particular."

Staggering growth

On Jan. 1, XRP was valued at $0.0065, but towards the end of March and at the beginning of the second quarter, the price spiked to a high of $0.35 on May 18. It closed the quarter down, valued at $0.26 and to date has dropped off more sitting around $0.19.

Despite being down, the growth is still admirable. As for Vias, he believes there is still a big future for Ripple despite the volatility of the entire cryptocurrency market.

“What we have seen is an embracing of digital assets broadly by really established institutions. When you have folks like the [Bank of England], which did a [proof of concept] with us, as well as the Bank of Japan coming out and saying, we are considering this as legal tender at some point — when you see those developments, you can't help but feel that we are on the right path, that interest is going to continue to grow," Vias added.

source: https://cointelegraph.com/news/ripple-is-altcoins-king-in-second-quarter-up-almost-4000

A large number of investors have started to purchase cryptocurrencies as a short-term and long-term investment, a safe haven asset and an experimental investment to develop a proper understanding of the market and the technology behind cryptocurrencies such as Bitcoin.

As a result, even the initial coin offering (ICO) market, which is yet to showcase a viable product or a decentralized applications with an actual active user base, have begun to attract hundreds of millions of dollars in the past few months.

In fact, Tezos, Bancor and EOS, the three largest ICOs to date, have raised more than $485 mln, with the ICOs of EOS and Tezos still ongoing. However, none of these three ICOs have completed the testing phase of their software, leading many analysts to describe the ICO market as a bubble.

Still, the vast majority of investors in the cryptocurrency market are purchasing cryptocurrencies such as Bitcoin, Ethereum, Litecoin and Ethereum Classic as long-term investments.

A large portion of investors within the cryptocurrency market wholly support the monetary policy, vision and purpose of popular cryptocurrencies that have evolved into useful alternative financial networks and decentralized infrastructures for decentralized applications.

What is a balanced cryptocurrency portfolio?

As mentioned above, the purpose of investing in cryptocurrencies varies greatly for investors. Most Bitcoin investors consider Bitcoin as a safe haven asset and a digital currency and have purchased Bitcoin expecting it to become a major alternative financial network which could compete with global banking systems and reserve currencies such as the US dollar in the far future.

If an investor remains unclear about the structure, purpose and monetary policies of certain cryptocurrencies and is investing in specific cryptocurrencies as an experimental investment to learn more about the market and various cryptocurrencies, it will be smart decision to maintain a diversified portfolio of a few different cryptocurrencies.

Five qualities balanced cryptocurrency portfolio should have:

    1.Diversity - Invest in to various cryptocurrencies in small amounts .

    2.Real cryptos - Invest in real cryptocurrencies with actual use cases & real market value.

    3.Risk aversion -Cryptocurrency investment can be risky due to volatility, so invest no more than you can lose.

    4.Understanding cryptos - Invest on cryptocurrencies with distinct monetary policies & purpouse.

    5.Active community - Invest cryptocurencies with active community and active developement.

 

Investment tip from Andreas Antonopoulos

On June 13, Bitcoin and security expert Andreas Antonopoulos revealed his personal investment strategy in establishing a balanced portfolio of crypto assets. Antonopoulos wrote:

“Yes, I own a few different crypto assets as part of a small but diversified portfolio. I only risk as much as I'm willing to lose.”

The latter part of Antonopoulos’ statement is what most investors in the cryptocurrency market fails to consider. The entire cryptocurrency market is still at an early stage, and most cryptocurrencies remain extremely volatile. Hence, investors should not be investing more than they are willing to lose, especially if their investment is experimental and speculative.

Also, it will be beneficial and efficient for investors to utilize platforms such as Cyber Fund’s cryptocurrency portfolio builder Satoshi Pie, which allow investors to track their investments in real time in terms of change in value and performance against other assets.

Satoshi Fund

This way, investors can remain in control over their portfolios and establish a balanced portfolio of cryptocurrencies and assets.

source: https://cointelegraph.com/news/how-balanced-cryptocurrency-portfolio-looks-like-investment-tips

 

There are at least three ways, though only one of them looks rational today. First, you could mine your own bitcoins. Second, you could buy some from an exchange. Third, you could buy shares in a fund that has invested in bitcoins.

Please note that answering your question is not a recommendation, and I am not qualified to give advice on investments. However, as electronic payments expert Dave Birch put it to me on Twitter: “one doesn’t invest in bitcoin, one gambles on bitcoin”.

The problem is that people can make money by buying things that are essentially worthless, such as used postage stamps, Beanie Babies, and (historically) tulip bulbs. Tulipmania operated on the “bigger fool” theory, also known among stock traders as “momentum investing”. For example, tulip bulb prices may be insane but they keep going up. I may be a fool to buy them, but I expect a bigger fool to buy them from me. Simply replace “buy low, sell high” with “buy high, sell higher”. This works until you run out of fools.

However, you can buy things that don’t depend on bigger fools appearing, such as land and gold. Their prices may vary dramatically, but over the long term, they retain real value. When tulip bulb prices were tumbling, everyone wanted to sell. When gold prices tumble, people with money look forward to an “investment opportunity”.

 

Does Bitcoin have value?

Bitcoin is a digital currency. If you want to buy a camera for £250, then you need a way to transfer £250 to the seller. In theory, it doesn’t matter if you pay cash, write a cheque, email the money via PayPal or use bitcoin. In reality, you have to balance a range of factors including convenience, security and transaction costs. I’d use a credit card, if possible, because bitcoin payments are not reversible and offer no consumer protection.

But if you are investing, does bitcoin have an intrinsic value, like gold? To me, bitcoins look more like tulip bulbs.

The price of a bitcoin may increase because, for example, it is attractive to technology enthusiasts, and because we are all reading stories about how people made – or failed to make – fortunes. But, like tulip bulbs, bitcoins could be worthless when the bubble bursts.

As Henry Blodget told CNBC: “Look, this is a perfect asset for a speculative bubble. There is a finite supply. There is no intrinsic value. If anybody is persuading you that it should somehow be related to some GDP or gold … put down the Kool-Aid and back away.”

You could argue that banknotes don’t have any intrinsic value either. However, banknotes are backed by governments that have a strong interest in keeping their value relatively stable. Governments don’t (yet) care what happens to bitcoins.

Mining for money

Bitcoins are “mined” by people solving problems with computers. In the beginning, the best way to make money from bitcoins was to mine them with a home PC. However, bitcoin mining becomes more difficult the more miners there are. Today, you need specialised hardware, and you need to join a “mining pool” where large numbers of miners work together and share the results. Coins are not pure profit because of the cost of the hardware and the electricity consumed when mining. Also, you don’t know what bitcoins will be worth when you start mining them.

However, there must be dozens of digital currencies besides bitcoin, and the CoinChoose website lists a Top 20. Well known alternatives include Ethereum, Litecoin, Dogecoin and Bytecoin. You might find one that is still worth mining, or that might represent a better gamble than bitcoin. CryptoCompare is another useful website.

Ethereum is interesting because it’s backed by an alliance that includes JP Morgan, Microsoft, Intel, Banco Santander, Credit Suisse Group, UBS and BP. It’s designed to perform transactions very much faster than bitcoin, and its hashing system is decentralised by design. It favours individuals, not mining pools.

 

Buying bitcoins

You can buy bitcoins from a bitcoin exchange or online broker, directly from another individual, or from an ATM. Coin ATM Radar lists about 50 bitcoin ATMs in London, many of them in convenience stores. As when buying foreign currencies, there’s a fee, which can range from 3.1% to 17.6%. The website covers 56 countries and you can search for an ATM near you.

A bitcoin ATM usually takes cash from your bank card, though some only accept banknotes. It sends your digital currency (bitcoin, litecoin etc) to your wallet, which could be a smartphone app, or to your email address. Some ATMs can print “paper wallets” that you can scan later.

If you buy a digital currency from an exchange, it may well offer you an online wallet, but your money is at risk unless you have the keys. When the Mt Gox bitcoin exchange was hacked, around 850,000 bitcoins went missing. It was a $450m loss at the time, but at today’s exchange rate, it would be $2bn.

Wallets

There are dozens of different wallets for different purposes, with “hot” wallets on smartphones and “cold storage” wallets held offline on paper, on hardware devices (cards, thumbdrives etc) or on separate PCs. These are equivalent to your spending money and your savings account respectively.

You will need to research wallets. However, We Use Coins has a decent guide, and it recommends BitPay’s Copay to beginners. It’s easy to use and it runs on iOS, Android, Windows and Windows Phone, MacOS and Linux. It can also handle shared accounts.

I used my Android phone to search for “bitcoin wallet” on Google Play, and gave up when it produced around 200 results. Copay was near the top. It only took two minutes to create a wallet, and it prompted me to make a backup: “Watch out! If this device is replaced or this app is deleted, neither you nor BitPay can recover your funds without a backup.”

It also warned me that “Anyone with your backup phrase can access or spend your bitcoin”. I dutifully wrote it down.

Once the wallet is set up, you can use the app to buy bitcoins from Coinbase in 33 countries, and from Glidera in the USA. It can take several days to buy or sell bitcoins via Coinbase.

 

source: theguardian.com

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