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October 2019

The “Lost” QuadrigaCX Cryptocurrency Might Be on Exchanges After All

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QuadrigaCX

QuadrigaCX

There has been quite the turn of events with the “lost” QuadrigaCX cryptocurrency case recently. The digital tokens may have just been found! The cryptocurrency exchange’s founder, Gerald Cotton, died in December 2018 from Crohn’s disease, allegedly taking $190 million in crypto with him.

At the time, it was said that Cotton was the only individual to know the private keys of the cold storage wallet that held all of the company’s assets. Well, the digital currency may not have been held in cold storage after all.

QuadrigaCX Held on Kraken, Poloniex, and Bitfinex

According to an author at the cryptocurrency research company ZeroNonCense, the majority of the exchange’s Ethereum (ETH) was most likely stored on cryptocurrency exchanges. The author of the published report remains anonymous but strongly believes that the funds were kept on Kraken, Bitfinex, and Poloniex.

The information on the report was said to have come from Kraken’s CEO Jesse Powell and MyCrypto’s CEO Taylor Monahan. It was found that QuadrigaCX had accounts on all three crypto exchanges listed above and the funds held on these accounts were worth over $100 million.

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Two weeks ago, a report by Big Four audit firm Ernst & Young was released and claimed the exchange’s cold storage wallets have been “empty and unused” since April of 2018. With the wallets empty, it could very well be that ZeroNonCense’s report could be a possibility.

The author also believes that the founder’s widow and those working at the company may not have known about where the digital currency was held, as Cotton was found to be the only one managing and moving cryptocurrency. If the funds on these exchanges are found, the retrieval should be easy, and operations could resume.

At the time, QuadrigaCX has been granted creditor protection by the Supreme Court of Nova Scotia, giving the exchange a bit more time to try and locate and retrieve the funds.

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Trading with Crypto Exchanges and Crypto CFDs

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crypto cfd

crypto cfd

CFD could be a very foreign word for a crypto trader, but for traditional market traders, it is one of the most useful assets to trade with on different markets. CFD is an abbreviation for Contracts for Difference, which are basically assets that help you “buy a price” and not the asset itself. It may sound a bit confusing, but it is still quite easy to understand once you know the basics.

The primary difference between actual cryptos and crypto CFDs is the ownership. Meaning that when you are trading on a crypto exchange, you are using actual cryptocurrencies. But when you are trading crypto CFDs on a CFD broker’s platform, you are trading with the contract, meaning that you don’t actually own cryptos. Immediately it should spark some controversy as to why you should even consider such a trade, so let’s check out the advantages and disadvantages.

Crypto CFD: Advantages

Crypto CFDs are exclusive to CFD or Forex brokers. These companies are able to offer leverage on these assets, which is the primary reason why they are so attractive. For example, if I go to this CFD broker and engage in a $100 trade for BTC CFDs, I can then use a leverage of 1:100. Basically what that leverage does is increase the volume of my trade by 100, meaning I can now trade with $10,000 instead of $100. This, in the end, may earn me more than I would with my own assets. Basically, the broker lends you funds in order to increase your trades and thus your profits as well. Crypto exchanges rarely have this feature, which is why CFDs are not as well known among the crypto community.

Liquidity is also an advantage of crypto CFDs because they can be sold for fiat currencies, making them a lot more valuable.

Another small advantage is the lack of a crypto wallet, as there is no need for one. Therefore traders have all of their assets on one single platform, which helps the logistics. Unfortunately, this is where the advantages end and massive disadvantages begin.

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Crypto CFD: Disadvantages

Leveraging can be a double-edged sword. Although leveraging can offer bigger profits, it can also lead to massive losses, which may cause the trader to fall into debt with the broker. If you ever decide to engage in a crypto CFD trade with leverage, make sure to set a stop-loss on a point where you have half of your initial investment left. So if you invested $100 and got 1:100 leverage, you would have to set the stop loss at somewhere around $9,950 to avoid a complete zero-out of your account.

Another disadvantage is that CFD trades have deadlines. This means that when you place an order, that order will expire in a few days or so. This renders long-term investments completely useless. You could technically still do it, but the over-night fees for maintaining the position would just make it unprofitable. The over-night position is as it sounds, a position that lasts more than 24 hours, and it is usually accompanied by a fee.

Another disadvantage is that you don’t actually own cryptocurrencies, meaning that you cannot allocate them anywhere you like. For example, let’s say that there is a service that is only available in Bitcoin or Ethereum; you would not be able to pay with a Bitcoin or Ethereum CFD, because they are not real cryptos. Furthermore, the allocation may become a problem as a broker’s policies may change about crypto CFDs, which could stick you with the trade or force you to opt-out in an unprofitable position. With crypto exchanges, it’s different as you can immediately allocate the cryptos to another exchange’s account.

Conclusion

We have two very clear paths in front of us. Crypto CFDs come with advantages as well as disadvantages, so deciding how you want to proceed requires extensive research and comprehension. Hopefully this article can be a starting point to both.

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How Will a Higher Bitcoin Dominance Index Affect BTC Price?

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Bitcoin

Bitcoin

Bitcoin (BTC) had an excellent run in the first half of 2019 and looked like it could regain the highs that it had reached back in 2017. However, the month of July proved to be a reality check as the price of the token oscillated around $10,000. August started off in much better fashion as many investors got into Bitcoin as a form of hedge against the global economic uncertainties.

Key Analysis

That being said, the cryptocurrency has not been able to regain the momentum that it had displayed in the first half of the year and many predictions now seem a bit far-fetched.

Tim Draper, the noted cryptocurrency expert, had stated that 2019 was going to be the year in which Bitcoin was going to go on an unprecedented rally and eventually touch $250,000 per coin at some point in 2022. However, Draper has now revised his stance that if Bitcoin is going to reach those levels, then it would not be any time earlier than the first quarter of 2019. It goes without saying that the revision of such a prediction perhaps proves that Bitcoin is not going to get to significantly higher levels at any point this year.

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On the other hand, it is also important to note that the gains that Bitcoin has generated this year are nothing to be sniffed at. At one point, the price of the token crashed to $3,000, and after several attempts, the coin started on its remarkable rally this year.

At this point in time, the price of Bitcoin is $11,500, and it is, without a doubt, a respectable price. However, there are plenty of traders who are convinced that Bitcoin and the wider crypto market are primed for a significant bull run this year. Many even point to the cyclical nature of the traditional financial markets in order to illustrate their point. Only time will tell if their prediction is correct.

Featured image: DepositPhotos © timbrk

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BlockFi Includes Litecoin and USDC in Lending Portfolio

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BlockFi

BlockFi

Cryptocurrency has gone through a lot of new developments over the past few months and today, cryptocurrency lending company BlockFi made a major new announcement. The company, which operates its own platform, announced today that it has added support for two more digital assets.

Major Expansion

The company announced that from now on, loans can be disbursed in the form of Litecoin as well as in the stablecoin USDC. USDC is backed by the United States Dollar. This is a significant development for Litecoin and USDC, as both those cryptocurrencies will now be made available to a wider pool of customers.

In addition to the digital assets added today, the other cryptocurrencies in which loans are made from the BlockFi platform include Gemini Dollar, Ethereum, and Bitcoin. However, it is important to note that the platform is not only meant for lending purposes. Customers will also be able to trade in these cryptocurrencies and earn interest on what they store in their wallets. In order to earn interest, a customer would have to create a BlockFi Interest Account and get to earn monthly compound interest on their holdings.

The annual percentage rate for Litecoin holdings has been pegged at 3.8%, while the same for USDC has been set at 8.6%. This marks another major development for not only these two digital assets but also for the entire crypto sector. Litecoin is one of the biggest cryptocurrencies in the world, and the fact that the availability of the coin is expanding is a major development for the token’s fans.

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While the crypto industry has had its ups and downs, the crypto lending industry has grown at a fair clip. In fact, it has been one of the best performers in the entire industry. Much of that is due to the bearish patterns in the market in 2018 and the latter half of 2019. BlockFi has been one of the beneficiaries of the market as well.

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