Bitcoin Could Be About To Surge After Stock-To-Flow Update Revealed

Bitcoin has been struggling to break over the $10,000 per bitcoin level since its highly-anticipated supply squeeze—but that could be about to change.

The bitcoin price, up around 30% since the beginning of the year and on track to be one of the year’s best performing assets, has swung wildly over the last few months.

Now, one of the most closely-watched bitcoin analysts, an anonymous strategist who claims to be a member of an institutional investment team that manages around $100 billion in assets, has released an update to his so-called stock-to-flow model, suggesting the bitcoin price could be about to surge to around $100,000.

Widely-respected bitcoin analyst PlanB, who created the stock-to-flow bitcoin pricing model, revealed a chart update last night.

The update, which has been expected since bitcoin’s third supply halving last month, is thought to signal the beginning of the next 18-month bitcoin price cycle that puts bitcoin at almost $100,000 before 2021.

The stock-to-flow pricing model calculates a ratio based on the existing supply of an asset against how much is entering circulation.

Commodities such as gold–with the largest stock-to-flow ratio of 62, meaning it would take 62 years of gold production to get the current gold stock–have a higher stock-to-flow ratio and are valued by investors for their scarcity.

Silver has a stock-to-flow ratio of 22 years for its production to reach the current silver stock.

Bitcoin’s stock-to-flow ratio is now 50 following bitcoin’s third halving last month, which saw the number of the number of bitcoin rewarded to those that maintain the bitcoin network, called miners, cut by half—dropping from…

Continue reading at FORBES.com

 

 

Bitcoin rally

Is Bitcoin On Its Way To Finally Break $10K?

Another week has passed, and it has been nothing short of exciting on the cryptocurrency market. Bitcoin went on to lose a serious chunk of its value as it plunged below $8,700 only to recover a few days later and touch $9,600. However, BTC is relatively indecisive over the past couple of days as it got rejected at that level, and it’s currently trading slightly below it around $9,400. 

If Bitcoin can climb back above this important resistance level, it may take another shot at the coveted $10,000 mark. As of yet, though, it appears that bulls are losing momentum and regrouping. 

Altcoins managed to catch a break while Bitcoin was plummeting, as some of them, including MATIC, Cardano, and a few others, marked notable increases. Bitcoin’s dominance remains rather intact, signaling that nothing has changed from a macro perspective. Ethereum was the winner during the past two days, as it managed to increase by 10%, reaching a 30-days high. 

The week was marked by news concerning institutional investors. First, new data revealed that Grayscale has been buying quite a lot of BTC. In fact, it bought 50% more than all the bitcoins mined over the past 100 days. 

At the same time, Coinbase acquired a leading cryptocurrency brokerage to further strengthen its institutional focus. The Winklevoss-owned exchange Gemini partnered up with Bitwage to launch a Bitcoin 401 (k) plan, while also teaming up with Samsung to integrate its mobile app in the tech giant’s blockchain wallet. 

In any case, it appears that smart money is becoming increasingly interested in the field, and it’s exciting to see what this will mean for Bitcoin going forward. 

Market Data

Market Cap: $263B | 24H Vol: $110B | BTC Dominance: 65.9%

BTC: $9,432.07 (-0.30%) | ETH: $220.69(+2.82%) | XRP: $0.198 (-0.19%)

cryptopostfriday

Wall Street Is Where You End Up When You Can’t Make it To Crypto: Winklevoss To Goldman Sachs. According to the prominent Bitcoin proponent Tyler Winklevoss, Wall Street is the place people end up when they can’t make it to crypto. This comes as a response to a recent report following a Goldman Sachs conference call on Bitcoin and Gold. 

Chris Dunn Trader’s Digest: Bitcoin To $150K Post-Halving, Crypto Investing Methodology, Tips, And More. Chriss Dunn is a well-known cryptocurrency YouTuber and a vocal participant in the community. He thinks that Bitcoin might reach $150,000 if we simply assume that it will gain 40% of what it gained after the previous halving. 

Tech Giant Samsung Will Integrate Gemini’s Mobile App On Its Blockchain Wallet. The tech giant Samsung will integrate Gemini’s mobile app into its blockchain wallet. This is a major step forward as it will now be particularly easy for Samsung users to buy and sell different cryptocurrencies. 

Gemini and Bitwage Combine to Launch Bitcoin 401(k). Gemini has partnered up with Bitwage to introduce what’s reportedly the world’s first Bitcoin 401k plan. It enables companies to provide their employees with the ability to invest in Bitcoin. 

Coinbase Strengthens Institutional Focus, Acquires Leading Crypto Brokerage. The leading US-based cryptocurrency exchange Coinbase has acquired crypto brokerage Tagomi. This is intended to strengthen the exchange’s focus on institutional clients and paves the way for further adoption. 

Grayscale Is Buying More Bitcoin Than There Is Mined, Report Says. According to a recent report, Grayscale has bought 50% more Bitcoin than it was mined in the last 100 days. This signals a serious institutional interest in the field, and it’s interesting to see if it would impact Bitcoin’s price. 

Charts

This week we have a chart analysis of Bitcoin, Ethereum, Ripple, Tezos, and Chainlink – click here for the full price analysis.

The post Is Bitcoin On Its Way To Finally Break $10K? The Crypto Weekly Market Update appeared first on CryptoPotato.

Source: Crypto Potato

Goldman Sachs: Cryptocurrencies ‘Are Not an Asset Class’

Goldman Sachs held an investor call Wednesday to discuss current policies for bitcoin, gold and inflation in the context of the COVID-19 crisis. The big takeaway? The stalwart investment bank is still no fan of bitcoin or other cryptocurrencies.

slideshow released before the call cited hacks and other losses related to cryptocurrencies as well as their use to “abet illicit activities” as some potential liabilities.

Seven of Goldman’s 35 slides mention bitcoin, but the people on the call only discussed bitcoin for roughly five minutes at the end, with no questions taken after.

In the call materials, Goldman notes that while cryptocurrencies like bitcoin “have received enormous attention,” they “are not an asset class.”

Why? The reasons include bitcoin’s inherent lack of cash flow, unlike bonds, and its inability to generate earnings through exposure to global economic growth, according to the presentation. Goldman also notes bitcoin’s volatility, citing the recent drop to 12-month lows in early March. The price spiked nearly 5% to $9,200 a few hours before the call.

Some professional cryptocurrency analysts were less than impressed by Goldman’s analysis. “The criticisms were very cookie cutter, the type you’d expect if someone just read mainstream headlines,” said Ryan Watkins, bitcoin analyst at Messari and former investment banking analyst at Moelis & Company. “It’s like they didn’t fully diligence the asset.”

Goldman’s cash flow argument was particularly odd to Tom Masojada, co-founder of OVEX Digital Asset Exchange.

“Many investments that Goldman labels as ‘suitable for clients’ do not generate cash flows and are primarily dependent on whether someone is willing to pay a higher price at a later date,” he said on Twitter.

“One could argue bitcoin isn’t backed by anything, but to liken it to a game of hot potato ignores the subjective value such a novel asset provides,” said Kevin Kelly, former equity analyst at Bloomberg and co-founder of Delphi Digital, a cryptocurrency research firm that recently published a comprehensive report on bitcoin.

Bitcoin’s current value, according to Kelly, is backed by “the demand for an apolitical speculative asset that may or may not turn out to be one of the world’s most valuable safe havens.”

The two Goldman speakers on the call, its head of research and a Harvard economics professor, said several bitcoin forks, which they refer to as “nearly identical clones,” occupy three of the six largest cryptocurrencies by market value. With this, Goldman inferred that cryptocurrencies as a whole “are not a scarce resource,” according to the presentation.

This critique is “particularly eye roll worthy,” Watkins told CoinDesk. “Forks are their own assets and have nothing to do with bitcoin.”

In its conclusion, Goldman does…

Continue reading at COINDESK.com

 

 

This Crypto Could Blow Bitcoin Out Of The Water This Year After 1,000% Gain—Here’s Why

Bitcoin, the world’s most valuable cryptocurrency by a wide margin, is treading water after rallying hard since its March crash.

The bitcoin price failed to breach $10,000 last week and has been trending downward since—despite a raft of bullish signals.

Now, as a number of smaller cryptocurrencies and bitcoin rivals make big gains, one tiny token has soared over 1,000% since its March lows.

Theta, the primary cryptocurrency token of the Theta decentralized video streaming network, has added over 1,000% to its price since the bitcoin and wider cryptocurrency market crashed in March, according to CoinMarketCap data.

Theta’s massive gains so far this year eclipse bitcoin’s 120% rally since the March coronavirus-induced crash—even as bitcoin looks on track to be one of the best bets of 2020.

The theta mega-rally comes as rumors swirl the San Francisco-based Theta Labs is poised to announce a partnership with YouTube-owner Google on Wednesday, May 27.

Theta Labs did not respond to a request for comment.

The Theta Network bills itself as a “decentralized streaming video protocol” powered by bitcoin’s blockchain technology and is designed to give “users the opportunity to contribute their excess bandwidth and computing resources in exchange for token rewards.”

A partnership with search giant Google, which recently launched the cloud gaming service Stadia, could be seen as an endorsement of Theta Labs’ decentralized video infrastructure and business model.

Earlier this month, it was revealed Theta.tv will be included on future Samsung Galaxy phones with the software expected to be added to some 75 million existing devices.

“Our groundbreaking approach to streaming is a perfect fit for Samsung’s worldwide user base,” Theta Labs co-founder and chief executive Mitch Liu said at the time.

“It’s a huge step toward our goal of making Theta a global infrastructure for video content and data delivery.”

Meanwhile, the world’s largest bitcoin and cryptocurrency exchange Binance has revealed it will support Theta’s upcoming mainnet upgrade. Binance also announced today it will launch a theta-U.S. dollar perpetual trading contract with up to 50-times leverage.

Similar bitcoin and crypto exchange announcements of support have boosted smaller cryptocurrencies in recent weeks, indicating the market is desperate for clearer direction.

Some bitcoin and cryptocurrency watchers have suggested a…

Continue reading at FORBES.com

 

 

 

Bitcoin Falls to 2-Week Lows

With bitcoin’s price losing altitude again, small investors appear to be seeking exposure to the top cryptocurrency by market value.

Prices fell by 9.8% last week to register bitcoin’s biggest weekly decline since the second week of March, according to CoinDesk’s Bitcoin Price Index. A two-week low of $8,630 was registered early on Monday, with prices last seen at $8,730 – down over 11% from the post-halving high of $9,960 registered on May 18.

Despite the price drop – or perhaps because of it – the number of addresses holding smaller amounts of bitcoin has continued to rise.

glassnode-studio_bitcoin-addresses-with-balance-%e2%89%a5-0-01

The number of unique addresses holding at least 0.01 BTC (around $87 at press time) rose to a new high of 8,478,746 on Sunday, according to data provided by blockchain intelligence firm Glassnode.

Meanwhile, the number of addresses holding at least 0.1 BTC (roughly $870) also rose to a lifetime high, reaching 3,053,004 on Friday. Both metrics regained their upward trajectory following the May 11 mining reward halving.

See also: Bitcoin Halving Arrives: Mining Rewards Drop for Third Time in History

“Retail investors are likely in an accumulation phase,” said Ki Young Ju, CEO of blockchain analytics firm CryptoQuant.

The dip demand may be associated with the bullish narrative that bitcoin could repeat history by charting a solid price rally over the next 12 months. The cryptocurrency witnessed a 30% pullback in the four weeks following its second reward halving on July 9, 2016. However, the decline was erased in the subsequent months and prices rallied to record highs by March 2016.

Prominent trading firms are also retaining a constructive outlook on the cryptocurrency. “The price pullback was expected and the long-term bias remains bullish. We would accumulate if prices drop to the $6,000-$8,000 range,” said Darius Sit, co-founder and managing director at Singapore-based QCP capital.

That said, the growth in the number of small addresses does not necessarily all represent new individual investors. This is because a single user can hold cryptocurrency in multiple addresses.

Exchanges and custodial services also tend to hold bitcoins in multiple addresses. “Wallet management systems of virtual asset service providers have become more complex and granular. Their wallet clusters include more small wallets for security, etc.,” said Ju.

As such, it is difficult to gauge exactly how much of the small address growth has been driven by new investor participation.

Even if small investor participation is increasing, it is unlikely to have a big impact on prices because the market is still dominated by large players, popularly known as “whales.” The number of addresses holding at least 10,000 BTC and 1,000 BTC have declined over the last two weeks, according to Glassnode data.

Moreover, options market activity suggests a deeper price drop could be in the offing in the near-term. “Traders are buying out-of-the-money puts,” said Chris Thomas, head of digital assets at Swissquote Bank.

A put option represents a bearish bet on the cryptocurrency, while a call option represents a bullish bet. An out-of-the-money put option has a strike price that is lower than the market price of the underlying asset.

Thomas expects bitcoin to move toward the $8,000–$8,200 range in the short term. That looks likely, as per the charts, as the cryptocurrency has breached a trendline rising from March lows.

Daily chart

download-6-39

Bitcoin fell by 5% on Monday, violating the support of the…

Continue reading at COINDESK.com

 

 

The biggest threats to Bitcoin in 2020

Tech entrepreneur, author and Bitcoin proponent Andreas Antonopoulos has shared his view on what factors or global events could seriously threaten Bitcoin’s existence in 2020 and beyond.

Turns out, the list is quite short.

Bitcoin would likely survive a 51% attack

Firstly, Antonopoulos noted that 51% attacks—usually the biggest elephant in the room when it comes to Bitcoin’s existential threats—are not that scary in reality. While it’s possible, theoretically, that a large group of malicious actors could try and wrest control over 51%—or more—of Bitcoin’s hash rate to disrupt the network, such attacks are extremely costly and not even too effective.

“Such attacks are very expensive to pull off, require enormous coordination, deliver very little in benefit and can be relatively easily thwarted. So for such an enormous cost, such little reward and such enormous risk, we haven’t seen 51% attacks and I don’t think we will see 51% attacks,” said Antonopoulos.

He added that even if a 51% attack did occur, Bitcoin would likely survive it, since there’s not much that malefactors could actually do during the attack. They wouldn’t be able to steal people’s money, change consensus rules or turn invalid transactions into valid ones. That’s thanks in large part to Bitcoin’s decentralized nature, since it’s not just miners who validate transactions—it’s also nodes, exchanges and merchants.

Is Bitcoin disaster-proof?

Speaking of more catastrophic events, Antonopoulos said that while a massive electric failure could certainly damage Bitcoin, banks and existing financial systems would suffer a much more severe impact.

“Bitcoin would be one of the first things to come back,” in the event of a massive electric failure or a natural disaster that damaged infrastructures such as the Internet or the electric grid, said Antonopoulos.

Not only is Bitcoin a self-funding system; its decentralized community of users, miners and node operators have many incentives to rebuild their local infrastructures in a timely fashion.

Andreas ☮ 🌈 ⚛ ⚖ 🌐 📡 📖 📹 🔑 🛩

@aantonop

What is the biggest threat to ? 51% attacks? Government crackdowns? Massive failure of the electric grid? Pandemics? …Sharknados? 🦈🌪️

New Q&A up on the aantonop channel! 👀 https://aantonop.io/bitcointhreatsqa 

78 people are talking about this

As Decrypt reported recently, Bitcoin isn’t dependent on an Internet connection to operate in some instances. For example, Blockstream’s satellite network enables transactions to be made with just a TV satellite dish and a smart device. “Bitcoin just requires a communication medium,” said Antonopoulos; even a shortwave radio or telephone lines could be used in a pinch.

Similarly, while concerted attacks against mining equipment—such as viruses or worms—could prove troublesome, they are “survivable” and would result in quick fixes, Antonopoulos added.

With hackers and natural disasters out of the way, what’s the next biggest threat to Bitcoin?

Governments.

What would happen if governments soured on Bitcoin?

If there’s one thing that does worry Antonopoulos, it’s political attacks on Bitcoin and other cryptocurrencies. In particular, he’s concerned about “sneaky political attacks” such as changing the tax status of cryptocurrency in order to drive it underground. “I do think that such attacks could alienate a big chunk of the middle class and speculative investors, who will not take the risk to oppose governments in order to use Bitcoin,” Antonopoulos explained.

He pointed out that, in his view, more than…

Continue reading at DECRYPT.co

 

 

 

Is Ethereum More Stable Than Bitcoin?

Crypto assets have become a vivid example of the statement ” What goes up, must come down” and time after time we are convinced of the validity of this phrase. Overcoming the threshold could have opened the way for testing price levels up to $10,500 in the near term, but buyers again lacked the strength. In 7 days Bitcoin shows a decline of almost 4%.

Altcoins moderately follow Bitcoin. The total capitalization in a day decreased by $10 bln. This cannot be called a large-scale sale, but there is a worsening of investor sentiment, which may result in increased sales pressure soon. The Crypto Fear & Greed Index after a 12-point growth over the week showed a daily decline of 3 points, which is a relatively accurate reflection of what is happening in the market.

While all the news was around halving and the likely prospects for Bitcoin after this event, the leading altcoin Ethereum (ETH) demonstrated quiet growth. Since the beginning of the year, Ethereum has grown by 61%, compared to 31% for Bitcoin in the same period. ETH usually follows the increase in Bitcoin, but in the end, it turns out that the coin adds more and loses less.

Favourable prospects for Ethereum are linked to the fact that its network is becoming increasingly active by launching decentralized financial applications (DeFi). ETH holders can block assets in DeFi smart contracts with different purposes, which reduces the circulation of coins, naturally creating an effect that is achieved in the bitcoin network by halving. Bitcoin maximalists do not see Ethereum as a threat, but there is no point in believing that a network after switching to 2.0 cannot be a worthy competitor to bitcoin.

Bitcoins mined at the very beginning of the network’s existence have long been at the centre of attention of the crypto community. The reaction to the transfer of 50 bitcoins, which have been motionless since 2009, has been decisively strong. These coins were…

Continue reading at YAHOOFINANCE.com

 

 

Bitcoin Price Drops After Rejecting a Key Resistance Level

Within the last hour Bitcoin (BTC) price abruptly dropped 4.9% from $9,800 to $9,324. The sharp correction came after the top ranked digital asset on CoinMarketCap failed to push through the $9,900-$10,000 resistance zone.

At the time of writing traders appear to be viewing the pullback as a dip buying opportunity, possibly due to the boost in bullish sentiment brought about by yesterday’s golden cross between the 50 and 200-day moving averages.

Crypto market weekly price chart. Source: Coin360

Interestingly, prior to the 5% correction, crypto-Twitter was abuzz with discussion over the transaction of 50 Bitcoin that hadn’t moved wallet addresses since 2009. Some traders speculated that the coins were possibly from Bitcoin creator Satoshi Nakamoto.

Bitcoin: Spent Outputs with a Lifespan > 10 years. Source: glassnode

Blockchain analytics provider, Glassnode posted the above chart and said:

A #Bitcoin UTXO older than 11 years was just spent on-chain! It dates from February 9th 2009 – only one month after the creation of Bitcoin.

View of Bitcoin not spent since 2009. Source: Twitter, Antoine Le Calvez

According to crypto trader Antoine Le Calvez, today’s spend was “the first time since August 2017 that someone spent coins from early 2009.”

BTC USDT daily chart. Source: TradingView

As shown on the daily chart, Bitcoin’s drop from the rising wedge pattern brought the price to a well tested support at $9,400. The price also remains above the 20-day moving average but it’s possible that the rising wedge trendline will now function as a level of resistance.

The trendline is also aligned with a high volume node on the VPVR from $9,627 to $9,767. Investors thinking about buying the dip could wait for a 4-hour candle close to see if the price begins to form higher lows.

Bitcoin daily price chart. Source: Coin360

Many of the top-10 altcoins also…

Continue reading at COINTELEGRAPH.com

 

 

Crypto Traders Explain Where Bitcoin Price Can Go After Fifth $10K Test in 11 Days

The price of Bitcoin (BTC) tested $10,000 a total of five times in the past 11 days. The price action can be considered as a bullish or a bearish trend based on varying perspectives. The quintuple test of a key psychological level at $10,000 can be analyzed in two ways: The $10,000 resistance level is getting weakened with every test, or the resistance is so strong that buyers are not able to break out of it.

Many top crypto traders believe that the mid-$9,000 area is a starting point to a new extended rally to the $14,000-to-$15,000 resistance range and with $20,000 as a medium-term target. Others foresee a sizable pullback to the $7,000-to-$8,000 region first, before Bitcoin’s price can aim for $14,000 and then attempt to break the record high.

The short-term, bullish scenario for Bitcoin

Traders who expect the price of Bitcoin to reclaim the $10,000 resistance level as support and see a rally to key levels above it predict that the resistance area was weakened with multiple spikes to the $9,800-to-$9,900 range.

Bitcoin tests the $9,900–$10,000 resistance range five times in 11 days

Bitcoin tests the $9,900–$10,000 resistance range five times in 11 days. Source: Tradingview

Traders continue to debate whether the current price trend of Bitcoin the start of a bullish uptrend following the highly anticipated block reward halving on May 11. Fundamentally, the block reward halving is a highly optimistic event for Bitcoin’s price because it directly affects the supply of BTC, as it halves the amount of Bitcoin mined, decreasing the rate, at which new BTC is produced and, subsequently, how much is sold on the market.

Historically, the halvings of 2012 and 2016 both resulted in at least a 2,500% increase in price. Hence, the bullish trajectory of BTC is that the halving will push the price of Bitcoin forward in both the short-term and the long-term.

According to cryptocurrency researcher Philip Swift, an indicator called the 2-Year Moving Average Multiplier shows BTC reached its bottom at $3,600 and broke out of a multi-year trendline at $5,800. At a macro level and in a more long-term scenario, Swift noted that the indicator suggests the next reasonable target for BTC is the all-time high of $20,000. Swift tweeted:

“$BTC has been super bullish since it broke out above the 2yr MA. We got our chance to accumulate below it b4 the hedge fund guys got all excited about Bitcoin. Next stop now the 2yrMA x5 [over $20,000].”

Bitcoin price with 2-Year MA multiplier

Bitcoin price with 2-Year MA multiplier. Source: Philip Swift

Similarly, Bitcoin trader Nunya Bizniz said Bitcoin is showing a “golden cross” at a high time frame, which has only happened seven times in Bitcoin’s history. The last golden cross was triggered when BTC was hovering at around $5,000 in early 2019 when it recovered from a plunge to $3,150. Bizniz tweeted:

“BTC Golden Cross (GC): GC = 50dma moves above 200dma. There have been 6 occurrences. Of those, only one has occurred while the 200MA is rising. A 7th GC is about to occur with a slight rising gradient in the 200MA.”

A golden cross typically indicates the start of an extended bull trend. However, the risk is that BTC’s price could potentially drop below this cross point when it happens, which then makes it a death cross with a bearish structure.

The seventh golden cross in the history of Bitcoin forms

The seventh golden cross in the history of Bitcoin forms. Source: Nunya Bizniz

For most of the macro bullish trends of Bitcoin to remain intact, BTC has to remain above $9,000 over the next week and continue to retest the $10,000 resistance level. The positive sentiment among professional traders also coincides with the moving average convergence divergence, or MACD, indicating an additional upside on a weekly Bitcoin price chart.

Bitcoin weekly price chart with MACD

Bitcoin weekly price chart with MACD. Source: Satoshi Flipper

With Bitcoin remaining above $9,000, cryptocurrency investor known as “Light” emphasized that the sentiment around Bitcoin among top traders is generally positive, tweeting:

“I am yet to run into a single competent trader/investor who is bearish on Bitcoin in this current moment. And those who are long are bullish with conviction. In hindsight it’ll either look incredibly obvious, or it’ll turn out that we’ve all run grossly ahead of ourselves.”

However, when the majority of the market is bullish, it often leaves BTC vulnerable to a correction before another uptrend. That is the risk of a deep pullback other highly regarded traders see in the near-term.

The bearish Scenario for Bitcoin over the next few weeks

If the optimistic predictions on Bitcoin revolve around the positive effect on the price of BTC a halving can have, negative projections also primarily revolve around the halving. In the previous two halvings, Bitcoin’s price dropped after the halving, and the real uptrend did not initiate until 8–12 weeks after the halving.

The tendency of Bitcoin to fall after a halving combined with the failure to break out of the $10,000 resistance level following five unsuccessful attempts has fuelled most bearish predictions for BTC. Bitcoin trader known as TraderXO said in a tweet that

Continue reading at COINTELEGRAPH.com

 

 

Bitcoin Broken

The U.S. Just Destroyed A Potential Dollar Rival—Is Bitcoin Next?

The U.S. Federal Reserve and president Donald Trump are fearful of challengers to the almighty dollar.

Bitcoin, a new form of digital money called cryptocurrency that is scarce and exists independently of government, heralded a wave of technological rivals to the dollar—with Facebook creating libra and China digitalizing its yuan.

This week, the U.S. financial regulator shut down messaging app Telegram’s decentralized crypto project—igniting fears the U.S. could again try to destroy bitcoin if it becomes a threat to the dollar’s shaky supremacy.

Following a long-running battle with the U.S. Securities and Exchange Commission (SEC), Telegram walked away from its blockchain-based Telegram Open Network (TON) and its native cryptocurrency, gram.

“Unfortunately, a U.S. court stopped TON from happening,” Telegram’s founder and chief executive Pavel Durov revealed this week, drawing a line under the embattled two-and-a-half year project.

Back in 2018, Telegram, now based in Dubai and boasting 400 million monthly active users, raised a staggering $1.7 billion from almost 200 private investors to fund development of the TON network and gram token.

The SEC blocked Telegram’s much-hyped public fundraiser just two months later. In October last year, the SEC ordered Telegram to halt the sale of gram tokens, finding it in violation of the Securities Act.

This week, the SEC hammered home the final nail in the TON coffin.

“The U.S. court declared that grams couldn’t be distributed not only in the United States, but globally,” Durov wrote.

“Why? Because, it said, a U.S. citizen might find some way of accessing the TON platform after it launched. So, to prevent this, grams shouldn’t be allowed to be distributed anywhere in the world—even if every other country on the planet seemed to be perfectly fine with TON.”

Durov argued the SEC decision “implies other countries don’t have the sovereignty to decide” what’s good or bad for their own citizens.

“We, the people outside the U.S., can vote for our presidents and elect our parliaments, but we are still dependent on the United States when it comes to finance and technology. The U.S. can use its control over the dollar and the global financial system to shut down any bank or bank account in the world,” Durov wrote, adding the U.S. can also force American iPhone-maker Apple and Android developer Google to ban apps.

“Unfortunately, we—the 96% of the world’s population living elsewhere—are dependent on decision makers elected by the 4% living in the U.S.”

The decision maker in question, U.S. president Donald Trump, has made it clear competitors to the dollar are not welcome.

“We have only one real currency in the U.S.A. and it is stronger than ever, both dependable and reliable,” Trump said last year in an outburst against Facebook’s libra, bitcoin and cryptocurrencies. “It is by far the most dominant currency anywhere in the world, and it will always stay that way. It is called the United States dollar!”

Trump’s tirade was sparked by news Facebook, now counting one third of the world’s population among its monthly users, was developing a “global currency” based on bitcoin’s blockchain technology.

Facebook’s crypto project has, however, been severely hobbled by regulators. A digital wallet supporting major currencies is now expected to launch in October. The “global currency” libra will likely never materialize.

This heavy-handed approach to digital currencies by governments and regulators has worried some in the bitcoin and cryptocurrency community.

“Going forward, either the project is fully decentralized or it has to be fully regulated,” said blockchain pioneer and managing director of investment management firm Yeoman’s Capital David Johnston.

Fortunately, highly decentralized cryptocurrencies and blockchains, such as bitcoin and ethereum, are very resistant to censorship and government control.

Previous attempts to ban or even “shut down” bitcoin itself have failed. Last year, it was revealed federal prosecutor-turned bitcoin and cryptocurrency expert Katie Haun was asked to look into “shutting down” bitcoin by her boss at the U.S. attorney’s office in 2012—something she said would have been impossible.

However, other countries, including…

Continue reading at FORBES.com