BitDigest August 6 · Issue #715

Aug 6, 2020
  • Bitcoin drives crypto market cap back above $350 billion
  • Members of the Congressional Blockchain Caucus tell the IRS staking rewards should be taxed differently
  • SEC Director responsible for ICO enforcement stepping down
BitDigest August 6 · Issue #715

Weekly Stock Review

BitDigest August 6 · Issue #715

Highlights from the North American listed crypto, blockchain and mining stocks:

  • The Grayscale Digital Large Cap Fund (OTCQX: GDLC) was the top performer among the North American blockchain and crypto stocks reporting a 142% price increase. GDLC’s premium to NAV jumped from 27.8% to 189.9%.
  • For the second week in a row, Marathon Patent Group (NASDAQ: MARA) posted a a considerable return with a new all-time-high of $4.79. MARA is up 130% over the past seven days and investors are moving into the crypto mining stock with average weekly volume increasing 61%.
  • Canaan (NASDAQ: CAN) announced that the company has reshuffled it board, separating with five former directors and adding four new independent ones.
  • Galaxy Digital (TSX: GLXY.V) spiked over the past few days hitting a new 12-month high of  high of $3.48.
  • Investors moved into Grayscale’s Bitcoin Trust (OTCQX: GBTC) with the run up in the price of bitcoin;  average volume increased 50% this week.
  • The Bitcoin Fund (TSX: QBTC-U.TO) reached a new all-time-high of $16.
  • Hut 8 Mining (TSX: HUT.TO) announced that it is taking over management from Bitfuty at its Medicine Hat facility to reduce costs and streamline operations.

Bitcoin Needs Electricity

Last week I reported that the Bank of Japan was working to ensure that the digital yuan would be fully accessible to all citizens, and more importantly it would be resilient and able to survive a natural disaster and loss of power.On Tuesday, many parts of New York lost power due to the impact of Hurricane Isais. As I write this, power has yet to return in my neighborhood (I was able to charge my computer in my office and am linking to my phone’s hotspot). While I was very fortunate that the damage I encountered was limited to falling trees and branches, this incident made me think about the impact of the loss of electricity on bitcoin. Without power, bitcoin is not lost – the decentralized structure provides for geographic distribution of the nodes – but on a more personal level, the lack of energy prohibits transactions from being completed. As we continue the path towards a digital world we must address this limitation. Without power, our digital future cannot be achieved.

The Headlines

BitDigest August 6 · Issue #715

The IRS Should Consider Staking Rewards Differently than Traditional Gains
Member of the Congressional Blockchain Caucus wrote to the IRS regarding the taxation on proof of stake tokens suggesting that the tax on staking should be treated differently than the tax on the token’s overall gain.
BitDigest August 6 · Issue #715

SEC’s Director of Enforcement Steps Down
Steve Peikin, the co-Director of the SEC’s Division of Enforcement is stepping down after a three-year tenure in which he is credited with establishing the Cyber Unit and leading its effort to combat fraud and misconduct in ICO’s.
BitDigest August 6 · Issue #715

Russia’s Largest Bank Considering Stablecoin
State-owned Russian bank Sberbank is looking to issue its own stablecoin pegged to the Russian ruble.
BitDigest August 6 · Issue #715

INX Plans to IPO by Years End
Gibraltar-based INX has filed a registration statement with the SEC and plans to raise up to $117 million which could make the crypto and security token exchange’s IPO the largest in the digital asset industry to date.
BitDigest August 6 · Issue #715

Davey is Coming to Bitcoin
On Wednesday, Bar Stool Sports President and retail trader influencer Dave Portnoy tweeted that he would like to invite the Winklevoss brother to educate him about bitcoin; yesterday he tweeted favorably warning “bitcoin people. I’m coming.”
BitDigest August 6 · Issue #715

Blockchain Salaries More Than Double in China
Chinese recruiting platforms are reporting an increase in blockchain salaries, up 130% year-over-year, as demand increases for specialists in the field.

Market Data

BitDigest August 6 · Issue #715

Bitcoin Gaining as Quasi-Currency Store of Value
Bloomberg’s August Crypto Outlook suggests bitcoin is gaining traction as a quasi-curerency store of value in the new quantitative easing increasingly digitized work; it also views ethereum’s current rally as being more speculative and lacking the supply conditions supporting bitcoin.
BitDigest August 6 · Issue #715

Bitcoin Still Prevalent on Dark Web
The average number of digital currencies supported on darknet websites in 2.14 and on a review of 49 darknet marketplaces, 98% offer support for bitcoin

Exchange, Custody and Product News

BitDigest August 6 · Issue #715

OKEx Launching P2P Trading Platform in India
Malta-based OKEx is launching a peer-to-peer crypto trading platform that will allow users to buy digital currencies with Indian rupees (INR) with zero transaction fees.
BitDigest August 6 · Issue #715

Coinbase Adds Support for .Crypto Domains
Coinbase announced it will begin to support .crypto blockchain domains and allow users to pay each other by typing the domain name (i.e Greg.crypto) into the send filed instead of a longer public bitcoin address.
BitDigest August 6 · Issue #715

Kraken Offering Zero-Fee Deposits and Adjusts Minimum Order Sizes
US-based crypto exchange Kraken is offering zero fees on US dollar deposits for clients of Signature and MVB bank. Kraken has also adjusted its minimum order sizes on a variety of altcoins to accommodate investors and active traders.

Thoughts on the Ecosystem

BitDigest August 6 · Issue #715

Investor Age Influences Choice of Asset Class
JP Morgan analyst Nikolaos Panigirtzoglou suggests that investor behavior across alternative asset classes is age specific with older investors buying gold and younger investors favoring bitcoin.

Reports you may have missed

CRYPTO MARKET UPDATE CRYPTO HAS RESUMED ITS RECENT WEAKENING TREND FOLLOWING A WEEKEND PUMP, WITH BTC -1.60% TESTING THE $65K LEVEL, ETH -0.27% TRADING AROUND $3500, AND SOL -1.58% APPROACHING $140. The ETHBTC ratio is declining again after a weekend relief rally sparked by news from Bloomberg ETF expert Eric Balchunas on Friday evening, clarifying his timeline for the ETH ETF launch. Meanwhile, the DXY continues its upward trajectory from the post-CPI selloff,...

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