Bitcoin Bounces above $4,000 as Santa Rally Brings Relief to Markets: BTCManager’s Week in Review

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Bitcoin Bounces above $4,000 as Santa Rally Brings Relief to Markets: BTCManager’s Week in Review

The price of bitcoin rallied by over 20 percent to close the week above the $4,000 thanks to a “Santa Rally ahead of Christmas.

After weeks of red markets, this rally provided some relief to crypto investors as the market seems undecided on whether it wants to find a new bottom or rally into the new year. As usual, opinions about where bitcoin is heading next mixed. Andrey Alekhin, CEO of blockchain art laboratory, said:

“I don’t think that this is the end of a bear trend. At least not yet. As a result of a steady decline in the crypto markets, many blockchain startups have been cutting down their activity or even leaving the market entirely. We’ve seen that many blockchain developers are looking for jobs now — this was not the case a few months ago. Startups liquidating their positions in crypto to survive will continue for some time, as will the bear market.”

Outspoke Bitcoin advocate, John McAfee, on the other hand, is standing by his prediction that bitcoin will continue to gain value and hit one million dollars by 2020. He tweeted:

“Bitcoin now over $4,000. It’s looking more and more like the market has turned. If it has turned, this is only the beginning. Perhaps 2019 will be the year future generations will look back on and name: ‘the year of emergence.’”

Interestingly, one of the most vocal Bitcoin price predictors, Fundstrat’s Tom Lee, announced he would no longer make price predictions after having to adjust his 2018-year-end target price downwards several times throughout the year from his initial $25,000 forecast.

The big winner in the altcoin market was Bitcoin Cash (BCH), which rallied by over 130 percent week-on-week to reach almost double the value of its new rival Bitcoin SV. With the new brand of Bitcoin SV complete, there is no longer any doubt which Bitcoin Cash is “the real Bitcoin Cash” as the market decided that the Bitcoin ABC upgraded version of Bitcoin Cash gets to keep the name.

This week’s contributions were provided by Aisshwarya Tiwari, Ogwu Osaemezu Emmanuel, and Shaurya Malwa.

Facebook May Launch a Stablecoin to Target India’s $69 Billion Remittance Market

Cryptocurrency’s first killer application may be well on its way from the rosters of Facebook, a company ironically known for practices contrary to the ethos of decentralized currencies and blockchains, reported South China Morning Post on December 21, 2018.

The San Francisco-headquartered social media giant is leveraging India’s mammoth $69 billion remittance market, which also forms the world’s largest. As per sources close to the matter, Facebook will deploy a stablecoin offering on its widely-popular WhatsApp service mobile application that initially began as a messaging platform but has since grown to offer an umbrella of products including micro-payments.

Facebook’s stablecoin endeavor aims to lower the costs of remittances while eliminating the notorious price volatility with which digital tokens are infamously associated.

At the time of writing, necessary details of the development remain unknown. However, it is confirmed that Facebook is working on a robust strategy to avoid untoward occurrences once the stablecoin releases, including a plan to develop a custodial fund that holds various currencies and protects the value of the token.

Bitmain IPO Suffers Major Setback as Hong Kong Regulator Declares Crypto Firms “Immature”

These are not the best of times indeed for Bitmain, the world’s largest manufacturer of Bitcoin mining equipment. Hong Kong’s stock market regulator, HKEX has made it clear that it would not approve the initial public offering (IPO) applications of DLT-linked firms until the region formulates a robust regulatory framework to govern its blockchain technology and cryptocurrency space, reported local news source, the South China Morning Post on December 19, 2018.

Per sources close to the development, Hong Kong Exchanges and Clearing Limited (HKEX), which is the country’s stock market regulator, has reportedly hinted it would not give Bitmain the go-ahead to launch an initial public offering, citing the premature and unregulated nature of the blockchain industry.

“It is premature for any cryptocurrency-linked business to conduct an IPO in Hong Kong before a solid regulatory framework is put in place by the authorities,” two anonymous sources reportedly told the South China Morning Post.

As reported by BTCManager in July 2018, Bitmain raised $1 billion in its pre-IPO funding round led by Tencent and SoftBank, after previously securing about $400 million from its funding round led by Sequoia Capital, as part of its target to raise at least $3 million before the commencement of its IPO. Having succeeded in securing vast amounts of funds, in September Bitmain officially filed a draft application to earn a listing on the Hong Kong Stock Exchange.

Binance CEO: 2018 a “Correction” Year for Crypto, Remains Confident about Industry’s Future

In a recent interview with Bloomberg, Binance CEO Changpeng Zhao stated that despite the ongoing bear market, he’s confident about the future of cryptocurrencies. On December 19, 2018, CZ gave a live interview to Bloomberg and opined that digital currencies are “here to stay.”

The monumental 2017 crypto bull run is still fresh in the minds of crypto proponents. While many argue that the exorbitant crypto rally was mostly due to market speculation, one cannot deny its impact on the crypto verse.

During his interview, CZ admitted that Bitcoin’s price fluctuation in 2017 was extreme, and the industry is now going through a steady correction phase. He remained positive about the future of the crypto industry, however, stating that cryptocurrency projects will continue to develop and drive towards mainstream adoption.

He added that development of dApps on various blockchains could prove to be a critical factor for the rapid adoption of DLT and digital currencies.

CZ answered questions related to real-world use cases of blockchain technology, the scope for dApps in the future, and the recent blockchain conference hosted by Binance in Singapore.

Speaking on the fluctuations in the price of cryptocurrencies, CZ explained that it is mostly the speculators and short-term traders who are concerned with crypto prices and that “the industry is going to grow by the builders, by the guys who actually build applications.”

U.K.’s Tax Authority Releases Taxation Guidelines for Local Cryptocurrency Holders

Her Majesty’s Revenue and Customs (HMRC), a non-ministerial department of the British government in charge of the collection of taxes, has published a paper highlighting the various types of fees applicable to blockchain-based virtual currencies and how cryptocurrency traders should handle their cryptos, according to a report released December 20, 2018, by the agency.

The HMRC has said that the small-scale buying and selling of cryptoassets by individuals can be categorized as an investment activity, and as such, it attracts a Capital Gains Tax.

However, it further stated that if the transaction is considered to be trading, then the trader will be required to pay income tax on his profit and losses, instead of a Capital Gains Tax.  

In essence, individuals residing in the UK who are paid in bitcoin and other digital assets by their employers, carry out cryptocurrency mining operations, or receive airdrops for services rendered to blockchain projects, are liable to pay income tax and national insurance contributions.

The agency also advised that cryptoassets holders need to accurately calculate their gain or loss when they dispose of their digital assets by way of selling them for money, swapping them for other cryptoassets, using them to make payments or sending them to another person, to find out whether they need to remit Capital Gains Tax.

Although the agency has made it clear that this revised guidance only applies to individual crypto traders, it has however reportedly hinted it would formulate new guidelines for bitcoin and altcoin-linked businesses and companies in the near-term.

Coinbase Lists DAI, Golem, Maker, and Zilliqa; Introduces Crypto to Crypto “Convert” Feature

A recent Coinbase Medium post, published on December 18, 2018, suggests that the cryptocurrency exchange platform will now support DAI (DAI), Golem (GNT), Maker (MKR), and Zilliqa (ZIL) crypto tokens. Support for these four cryptocurrencies will initially be available on Coinbase Pro.

Coinbase continues to roll out support for new cryptocurrencies. The exchange announced on December 18, 2018, that its Coinbase Pro platform would allow users to trade DAI, GNT, MKR, and ZIL digital currencies. Support for the aforementioned four cryptocurrencies will be available in the UK, Canada, EU, Singapore, and Australia.

The post highlighted that support for GNT and DAI would also be available in the US, except for the city of New York. Notably, MKR and ZIL cryptocurrencies will not be available to customers in the U.S., presumably due to ambiguity regarding regulations. Also, the newly listed crypto assets are not yet available on or their mobile app. The exchange stated that a separate announcement would be made to that effect.

Coinbase has been on a cryptocurrency enlisting spree lately. On October 24, 2018, the exchange platform listed Circle’s dollar-pegged USDC, making it the first instance of a stablecoin’s listing. Similarly, the exchange-listed Brave’s Basic Attention Token (BAT) on November 3, 2018, which soon sparked a mini-rally for the web browser’s cryptocurrency.

Interestingly, Coinbase had hinted in July 2018, that it is “exploring” the addition of several other crypto assets, including Cardano (ADA), Stellar Lumens (XML), Zcash (ZEC), and 0x (ZRX).

Alex Lielacher

Alex Lielacher is the founder & CEO of the Bitcoin-first content marketing agency, RIse Up Media. He regularly contributes to leading Bitcoin media publications and has been following Bitcoin since 2011.