Month: May 2019

By CCN: Jeffrey Gundlach, who in addition to being the CEO of DoubleLineCapital is known as the Bond King, is famous for his strong opinions. A vocal critic of politicians on both sides of the aisle, the hedge fund boss aimed at the Democratic candidates for the 2020 election in a blistering attack during the Sohn Investment Conference. He wants to “short them all.”

Three months ago the Fed predicted totally different policy than where they are now. How can they predict 2020 policy with a straight face?

— Jeffrey Gundlach (@TruthGundlach) March 21, 2019

Bond King Gundlach Wants To ‘Short’ Dems in 2020

Gundlach is in the Warren Buffett camp when it comes to his view on MMT (Modern Monetary Theory). He has often criticized Donald Trump for accelerating the U.S. accumulation of debt. But his comments about Joe Biden were worse:

“Now, Joe is grabbing the spotlight … but no, Joe, I don’t want your hands on my shoulders.”

Does the Bond King like Elizabeth Warren? Not a tough question. He considers her “the mother-in-law from hell.” Even the more moderate Beto O’Rourke was in his crosshairs, as he dubbed him a “snowflake” in a blatant attack on the Texan’s millennial voter base.

As you can probably tell, Gundlach is not optimistic for the economic or political outcome of the 2020 election should any of these Democrats make it to the White House. He summarised his viewpoint with the cutting:

 “I say short them all.”

Billionaire Hedge Fund Managers Were Wrong in 2018

For anyone rushing out to dump their portfolios because of what anyone at the Sohn Conference says, it’s worth noting that not even these billion-dollar managers get it right every time. Institutional Investor found that last year, several big names, including Gundlach, were flat wrong in their projections:

“Last year’s stock picks by star managers David Einhorn, Larry Robbins, and Jeffrey Gundlach all lost money, while the broader market gained more than 8% during the same time period.”

Ballooning National Debt Is A Bipartisan Problem

It’s easy to understand why the “Bond King” is terrified of MMT. The USA’s ability to pay back the debt it owes is what attracts investors to the safe harbor of U.S. bonds. With Trump as the Republican candidate and many left-wing candidates on the Democratic side, there is no fiscal hawk candidate for the 2020 election. Evidently, this is something that bothers the DoubleLine Capital CEO regularly, as he loves to remind people about the ballooning U.S. debt:

The United States National Debt surpassed $22,000,000,000,000 today.

— Jeffrey Gundlach (@TruthGundlach) February 13, 2019

Gundlach is well known for predicting that Trump would beat Hilary Clinton in the 2016 election. While he is on record saying it is too early to predict the outcome of 2020, he is clear about what he believes 2020’s central theme will be:

2020 is for the Dems what 2016 was for the Reps. Old Order of tired rhetoric out, New Order of ideas that matter to voters, even if bad, in.

— Jeffrey Gundlach (@TruthGundlach) February 11, 2019

2020 Election Promises Just One Thing

So there you have it. Gundlach hates all the Democrats, even the more moderate Joe Biden. He also detests Trump’s beloved MMT. We can glean from this that the 2020 election looks to have only one definite result. More U.S. national debt.

By CCN.com: Trading sentiments in Ethereum (ETH), the world’s second largest cryptocurrency, were extremely positive this Monday.

The ether-to-dollar exchange rate surged as much as 9-percent to establish an intraday high towards $175.97. The asset experienced a similar bullish bias against its peers in the cryptocurrency industry. The ether-to-bitcoin exchange rate, for instance, rose as high as 9.45-percent, indicating that traders were hedging their bitcoin holdings into the Ethereum market.

The bitcoin price dropped up to 2.45-percent during the Monday session.

The Ethereum pairs posted $7.43 billion worth of volume this Monday, according to CoinMarketCap’s 24-hour adjusted timeframe. Considering that 95-percent of the total reported trading activity is typically fake, the Ethereum pair originally posted $371.5 million worth of volume. The ETH-enabled trades looked well-spread across both regulated and unregulated exchanges.

CFTC Saved the Day

An official close to the Commodity Futures Trading Commission (CFTC) revealed Sunday that they were planning to approve an Ethereum-based, cash-settled futures contract.

The rumor helped driving the fresh wave of buying sentiment in an otherwise bearish Ethereum market. Traders may have picked the CFTC announcement as a sign of institutional investment, which explains why Ethereum was among the only few assets across the cryptocurrency board that trended in positive territory throughout Monday.

the @CFTC saved $ETH

that’s a sentence i thought i’d never say pic.twitter.com/cVE80mC6eT

— Josh HODLonautszewicz (@CarpeNoctom) May 6, 2019

Nevertheless, an Ethereum-based future contract means that speculators will not require to purchase the actual ether tokens to settle their contracts. Instead, they will use cash, which makes the ongoing Ethereum price rally baseless. Moreover, the capital injection into the Ethereum market could turn weak once a fully-corrected bitcoin prepares itself for another upside push. The move could see traders swapping their Ethereum tokens for bitcoin, believing that the latter will attempt a run towards $6,000, its support-turned-resistance level, to strengthen its bullish bias.

Opportunities

The Ethereum price has established support at its 50-period moving average (indicated via blue) which is maintaining the asset’s overall bullish bias. The price could face resistance in $177-180 area as it tests $185.39 as its upside target. A break above either of these areas would expose Ethereum’s upside to the parallel channel resistance (indicated via pink). At the same time, the price could also attempt a pullback action at any of those resistance levels, which would open decent short opportunities toward the 50-period MA.

Click here for a real-time Ethereum price chart.

By CCN.com: The Federal Trade Commission (FTC) has launched legal action against a serial crowdfund scammer who used his ill-gotten gains to buy Bitcoin.

Douglas Monahan promised consumers a ‘high-tech’ backpack known as the iBackPack, but failed to deliver the product after raising over $800,000. After allegedly scamming Indiegogo users of $720,000, Monahan staged three more crowdfund campaigns to take his total bounty to $0.8 million.

iBackPack ‘Creator’ Shut Down by Federal Trade Commission

The investigation against Monahan was inadvertently revealed last year when an FTC agent’s private email exchange was made public. On May 6th, the FTC took action and levelled a Complaint for Permanent Injunction and Other Equitable Relief against the Texas man.

According to the FTC, rather than use $800,000 to create the iBackPack, Monahan used the funds for ‘personal purposes’ – among them, buying Bitcoin. From the complaint filed in the Southern District of Texas, May 6th:

“Defendants have used a large share of contributions for Defendant Monahan’ s own personal purposes, such as making bitcoin purchases and ATM withdrawals and paying off personal credit cards; for marketing efforts to raise additional funds from consumers; and for other business ventures.”

Monahan’s victims also claim that their personal data was sold, owing to the unexpected marketing communications they all received soon afterwards. This is only the second time in history that the FTC has gone after a crowdfunder. In 2015, Erik Chevalier raised $120,000 for a board game, and then sold off contributors’ personal data after failing to deliver the product.

Crowdfund Hopping: Indiegogo to Kickstarter and Back Again

After failing to produce anything from the $720,000 he raised on Indiegogo, Monahan jumped over to Kickstarter and started marketing the iBackPack 2.0. From this campaign, he raised a further $76,000, all while his original backers were still awaiting their products.

He then launched another two campaigns back on Indiegogo and siphoned a further $11,000 from gullible investors.

The Indiegogo page for the iBackPack still exists, and has been inundated with nearly 4,000 comments from disgruntled patrons. One recent comment notes:

“I love that the FTC is suing you, and I hope they make Indiegogo just as guilty for letting this continue without protecting their customers.”

Gullible Victims? A Parallel Between Bitcoin and Crowdfund Investing?

Not a week goes by where the Bitcoin isn’t lambasted by critics in one way or another. This week it was Warren Buffet who dismissed Bitcoin as nothing more than a gambling device.

Cryptocurrency adherents are often characterized as gullible victims of an obvious bubble, but if $800,000 is being thrown away on the ‘iBackPack’ then we clearly have other problems to worry about. The ‘high-tech’ iBackPack appears to be nothing more than a bag with a charger and some USB ports inside it.

The parallels between Kickstarter promises and ICO pitches are obvious here. Just like with ICOs, crowdfunders do not have to guarantee that their project will even materialize. As Andrew Smith, Director of the FTC’s Bureau of Consumer Protection, said:

“If you raise money by crowdfunding, you don’t have to guarantee that your idea will work. But you do have to use the money to work on your idea—or expect to hear from the FTC.”

The cryptocurrency space would probably benefit from something similar.

By CCN.com: In a relatively small survey of 200 people, MyCrypto.com and Ambo, a mobile blockchain company it recently acquired, made some interesting discoveries. The survey covered 200 consumers in the US and found that more than half of them had used crypto to purchase goods or services.

More interesting than that, about the same percentage reported using mobile wallets to manage their crypto assets. Among the same people, only 37% use mobile wallets to manage non-crypto assets.

Over 66% of respondents use noncustodial wallets. So the majority of the people polled either understand the importance of decentralization or choose not to trust folks like Coinbase to hold their assets. That finding is probably the most encouraging.

MyCrypto itself offers a noncustodial service, which allows the user to quickly generate an Ethereum wallet. MyCrypto’s founder Taylor Monahan previously worked for MyEtherWallet, one of the most popular and most accessible solutions for creating an Ethereum wallet.

“19.5% of people use mobile apps for investing money and non-crypto assets while 15% use mobile apps for investing crypto daily. Signaling a near parallel in usage.”

MyCrypto’s one-page report on the results of the survey opines that usability remains a considerable problem for cryptocurrency.

 “One of the biggest narratives behind the power of cryptocurrency is about creating a global economy, but we’re not even close to that yet. While new and casual users face a large variety of barriers, the biggest one that we haven’t even tackled is that casual customers have no idea how to even use it.”

MyCrypto is one of many companies dedicated to the cause of making crypto easier. Perhaps the most ambitious effort is the FIO Foundation and its associated protocol, which aims to bring cryptocurrency to the masses by making it safer and easier to use.

At the same time, some believe that crypto is intended to be a store of value, so usability of the thing is far less critical than its security. MyCrypto argues that both are important:

“While it appears that crypto applications are alive and well, 46% of those surveyed see crypto as a long-term investment which allows us to concur that from a mobile app and money management standpoint there is room to grow in the development of wallet security that promotes long-term protection.”

It’s the season of crypto statistics, with a recent report finding that the majority of crypto exchange users come from the United States.

Another report from Blockchain Capital, which some have contested, found that around 11% of Americans currently own cryptocurrency, while awareness had risen in the extreme.

A poll by Blockchain Capital claims 11% of Americans own $BTC, which I think is grossly inaccurate.

I’d like to poll CT to see, based on your own personal interactions with others, what percentage of the population do you think owns #bitcoin?

Please RT for widest dissemination.

— 𝙂𝙊𝙅𝙄𝙍𝘼 🤠 (@G0JlRA) May 1, 2019

Is cryptocurrency just a few usability enhancements away from mass adoption? We won’t know until the improvements have come about.

The other side of that argument would be that cryptocurrency will never see mass adoption unless it becomes so superior as to be indispensable. Or, perhaps more likely, cryptocurrency will see mass adoption when the existing systems become so unreliable that people are essentially forced to use it. In many ways, the spike in Venezuelan adoption spells that out.