A Few Greenish Swings
Facebook’s plan of introducing its own global digital currency has taken a new turn as Mark Zuckerberg held meetings with large trading houses and active cryptocurrency exchanges. The Facebook CEO also held a meeting with his former rivals – The Winklevoss brothers, according to Financial Times. A team at Facebook has been working on developing a digital currency for over a year and aims to facilitate users to not only make transactions via the Internet, but also in the real world. At the company’s developer conference in April, Mark Zuckerberg had said, “Payments is one of the areas where we have an opportunity to make it a lot easier. I believe it should be as easy to send money to someone as it is to send a photo.” Facebook also held talks with Jump and DRW, high-frequency trading firms based out of Chicago, with respect to making its digital coin at par with the value of the Dollar. Facebook also spoke to Coinbase and Gemini, two prominent cryptocurrency exchanges, to let users store their coins safely and convert them into other crypto or fiat currencies for further use. Gemini, founded by the famous Winklevoss brothers, is known for its links to the regulators and also has the permission to function as a trust company under the New York banking law. Gemini was among the first two companies to get approval from the state for their digital currency, Gemini Dollar to be at par with the US Dollar. Winklevoss twins, in the past, had sued Facebook for “stealing their idea of building a social media network”. They claimed a compensation of $65 million and also received $1.25 million worth of shares in the company. David Marcus, the former PayPal President who is in charge of Facebook’s cryptocurrency team, had a meeting with the senior executives of Facebook to discuss the announcement of their plans. Recently, Facebook had also registered Libra, their Fintech arm, in Switzerland. The post Facebook in talks with Winklevoss twins, trading firms over new cryptocurrency appeared first on AMBCrypto.
Bitwise Report 2.0: Trading Spread tight among “real exchanges”, Bitcoin market efficient post price rally
As Bitwise Asset Management patiently awaits its decision from the US Securities and Exchange Commission [SEC], the firm has released yet another report detailing the Bitcoin spot market. Following their March proposal, Bitwise, among other things, highlights the tightening of trading spreads in the BTC spot market. The report released on May 24, stated that the trading spreads on the BTC spot market are “substantially tighter” than perceived. Bitwise clearly demarcates, right from the offset, between “real” and “fake” exchanges, based on volume. Coinbene, an exchange in the “fake” volume category posed over $500 million in volume with a spread of $12.22, while Coinbase, firmly in the “real” category, amassing $70 million volume with a spread of $0.01. The report contends: “This confusion exists because the data and volume on many exchanges is fake. The reality is that the real bitcoin spot market is extremely efficient, with spreads that rank amongst the lowest for any quoted financial instrument in the world.” As the earlier report and this recent one highlights, only ten exchanges pose “real” volume with average median spread on each for the month of April being $1.31, or 10.7 percent of Coinbene’s individual spread. Bitwise highlights the five most liquid exchanges, with their corresponding median spreads as Bitstamp – $1.75, Binance – $1.12, Bitfinex – $0.4, Kraken – $0.1, and Coinbase – $0.01. Last month, Bitcoin broke the $5,000 level quite early-on and the rally persisted till the end of April around the same mark, hence the median spread on the “largest real exchanges” was 0.01 percent – 0.03 percent, added the report. In light of the variance, the report concluded: “The relationship between trading volume and spread size is not perfect, as it is constrained by exchange-level fees, tick size, and other factors. Still, the relationship is strong, and the spreads on real exchanges are extremely small.” The March report detailed market efficiency in terms of arbitrage opportunities based on the ten “real” exchanges. At its peak, during the December 2017 bull run, the deviation stood at 0.7 percent and since then, it has not crossed 0.5 percent. Interestingly, as the prices were suppressed in March, the average spread ranged from Coinbase’s $0.01 to Bitfinex’s $0.1 only. The post Bitwise Report 2.0: Trading Spread tight among “real exchanges”, Bitcoin market efficient post price rally appeared first on AMBCrypto.
Bitcoin [BTC] and the larger cryptocurrency market trading came to a standstill in March, when Bitwise Asset Management released their report which detailed that 95 percent of the exchanges fake their volume. Two months later, Bitwise released yet another report expanding on this misrepresentation. The report, meant for the US Securities and Exchange Commission [SEC], attested that the Real BTC spot market still looked dismal, with only $554 million of the total $11 billion of the volume being legitimate. Two months were, by the looks of it, not enough for the cryptocurrency community to clean up its act as the report highlighted that 95 percent of the volume was fake. Source: Bitwise Furthermore, the report added that the BTC spot market is more focused on the United States. Due to the country’s stern registration laws, compared to tax havens like Seychelles, Malta, Hong Kong, more crypto-companies would pick the latter option. Despite the westwards ‘focus,’ the US accounts for under 3 percent of the reported BTC trading volume on exchanges domiciled in America. The report added: “Moreover, studies that look at publicly traceable data suggest that the U.S. has a relatively large real-world footprint in the bitcoin and blockchain space.” Bitwise contended this “real-world footprint,” based on several studies which affirmed the US’s dominance in web-traffic to BTC exchanges, accounting for 33 percent of total traffic, compared to other countries as well as VC investment into companies geared towards cryptocurrency and blockchain technology, which stood at 79 percent of all investment. The report starkly suggested that the ‘misalignment’ of the reported volume to the above contention of the dominant US “real world-foot-print” is due to the faking of the “reported volume statistics.” Given the real-world presence of the United States in the cryptocurrency market, coupled with the strong regulation within the country that accounts for domestic exchanges maintaining their volume and not misrepresenting it, Bitwise stated that 31 percent of all reported volume, that is “real,” comes from the US, with other countries in the mix, although in smaller proportions. Source: Bitwise The report read: “In reality, 31% of all reported volume takes place on exchanges domiciled in the U.S. market, with the remainder distributed amongst exchanges domiciled in Malta, Hong Kong, the UK, and Japan” Of the ten exchanges that Bitwise hailed as having “real volume,” back in March and in their recent report, six are from the United States. Among those six are Coinbase, Kraken, Gemini, itBit, Bittrex, and Poloneix. Based on this allocation, Bitwise draws a correlation between “real volume,” and “real world statistic,” for which it accounts for GDP, wealth, web-traffic and blockchain-related venture investments. The post Bitwise Report 2.0: Wash trading still rampant; US holds over 30 percent of ‘real volume’ appeared first on AMBCrypto.