Twenty-four hours ago the decentralized cryptocurrency bitcoin and its US$300Bn market capitalization just surpassed the International Monetary Fund's (IMF) Special Drawing Rights market (SDR $291Bn).

Bitcoin's Market Valuation Outpaces the IMF's Special Drawing Rights Reserves

Bitcoin's value has grown immensely in 2017 outperforming nearly every world currency, stock, and commodity this year. With a global average of over $18,000 per BTC and a $300Bn+ market valuation bitcoin has surpassed the IMF's international reserve assets ($291Bn). The SDR is comprised of a 'basket of legal tender' from five nation-states. The value of the SDR, also known as XDRs, is based off a percentage of Chinese renminbi, U.S. dollar, the Japanese yen, the euro, and the British pound sterling. The SDR was created in 1969 using the Bretton Woods exchange system, and before 1973 it contained the value of 0.8 grams of gold.

The SDR Gains Traction This Year As the U.S. Loses Ground, and Countries Decouple from the USD

Bitcoin's Market Cap Surpasses the IMF's Special Drawing Rights ReservesThe IMF's Special Drawing Rights market has always been controversial since the day it was introduced. Essentially, the basket of currencies are allocated to countries by the IMF and a nation participating in the exchange market has to have reserves. Many skeptics believe the IMF is creating a "globalist one world currency" so it can continue to keep the central banking system in power. This year has been an interesting year for the SDR, as the reserve has gained in value in comparison to other solitary nation-state currencies. The trend has seen an uptick due to a few nations decoupling from the USD, as the IMF revealed this past summer that America was no longer the top economic powerhouse. These days other countries like Germany, Russia, and China are making monetary moves on their own.

Bitcoin's Black Swan Event and the Next Transfer of Wealth

Bitcoin's Market Cap Surpasses the IMF's Special Drawing Rights ReservesHowever, the citizens of the world, the ones without borders, are riding the lightning growth of a different kind of currency. Bitcoin has become the censorship-resistant black swan economy that's not issued by a nation state or corporation. In fact, the decentralized currency came from an anonymous creator, and it's a software made up of digits and code that millions of people trust. Bitcoin has become an internet-infused 'people's money,' and the technology is shifting a lot of wealth into the hands of individuals in a way that's not been seen since the oil rush back in 1859. Even the International Monetary Fund's Christine Lagarde says bitcoin will cause "massive disruptions" to the existing financial system.

"In many ways, virtual currencies might just give existing currencies and monetary policy a run for their money. The best response by central bankers is to continue running effective monetary policy, while being open to fresh ideas and new demands, as economies evolve," explains Lagarde this September. 

The currency was born in 2009 and bitcoin has come along way since 10,000 BTC happened to be traded for two Papa Johns pizzas in 2010. A year later the currency reached parity with the U.S. dollar and rose to thirty dollars during its first "bubble." The reason it was called a bubble is because, shortly after, markets dipped to a low of $2. For a while, the price remained stable, but slowly rose to $13 in December of 2012. Then in the spring of 2013, the price jumped to $266 and rallied to a high of $1,242 across global exchanges. Again the high didn't last long as the price took a bearish dive all year after the Mt Gox exchange lost 800,000 BTC, and went bankrupt. That year economic pundits and financial publications called bitcoin the "worst currency of the year."

Bitcoin's Value Matures Greatly In 2017

In 2015 bitcoin started gradually rising once again and captured the top performing currency in 2015 and 2016. After the new year and into 2017 bitcoin once again surpassed $1,000 per BTC. It started its phenomenal rise that has stayed consistent every month since then. In March of 2017 bitcoin proponents thought it was a big deal when the decentralized currency surpassed the spot price of one troy ounce of .999 gold. However, bitcoin's capitalization even today is tiny in comparison to the gold market's 9 trillion annual valuation. Still, bitcoin is bigger than many of the capitalizations tethered to corporate entities and stocks. For instance, bitcoin's market cap is larger than Paypal, IBM, Disney, General Electric, McDonalds, and even the global fine arts market.

The half a trillion dollar cryptocurrency market is for the taking, and savvy market makers are not going to give up positions easily. Cboe was the first futures market for bitcoin, launching last Sunday a full week ahead of its crosstown and much larger competitor, CME Group Inc. With the might and heft CME brings into the space on Monday, Cboe is stealing a little of its thunder with TD Ameritrade's announcement that it too will allow clients bitcoin futures on the same day.

Manic Monday, TD Ameritrade's Cboe Bitcoin Futures Play

"At this point," TD Ameritrade announced in an email, "we believe the market is showing signs of adequate liquidity for the Cboe product. Therefore, on Monday, December 18th, we will launch the Cboe bitcoin futures contract on our platform for a subset of qualified retail clients."

The popular online retailer will require a minimum 25,000 USD in order to trade futures. It's also increasing the margin one-and-a-half times beyond Cboe's requirements, to 66 percent. To trade on a $17,000 bitcoin futures contract, for example, TD Ameritrade clients must fork over 11,000 USD. Entering the market at this point, the firm has elected not to simultaneously trade on CME, staying exclusively, for the moment, with Cboe as it waits to see how the rival exchange handles the digital asset.

TD Ameritrade is one of the largest retail futures traders around, and its Cboe play adds even more liquidity to the market. And though the Cboe contracts have been trading without incident, volume is very much on the low end due to most Cboe traders being outside the US, largely in South Korea and Japan where they obviously do not have US futures accounts. TD Ameritrade could be at once an answer to the volume conundrum and an easier way in for US institutional investors to enter bitcoin futures. 

Regarding limiting trades to just Cboe, TD Ameritrade managing director JB Mackenzie explained: "Right now we are taking the same approach we did with the Cboe product, to wait and see how it goes. We want to watch that market open and become an orderly marketplace and see who the participants are in that marketplace. This is the same process we use with any new product. We want to see how the market reacts," he told Bloomberg.

How will Particl succeed in gaining price appreciation, adoption and network effect where centralised anonymous marketplaces fail?

It's real simple. Particl is not a centralised marketplace so you would need to take the majority of the nodes down to compromise the network.

 

Contrast this with tradtional centralised marketplaces where taking down a handful of servers can shut down the entire service leading to loss of any funds held there.

• The Particl nodes can be run on the tor network for added security thus the network is inherently more resistant to tradtional hacks, takedowns and DDOS attacks.

• Integration of the currency into the platform means that the value of the PART token will increase rapidly as use of the marketplace increases.

• This is because although Particl can accept multiple cryptocurrencies, these will all be converted in the Particl client into PART token via integration of shapeshift exchange and other decentralized exchanges into the Particl client before being used to transact on the Particl network.

• Thus there is a constant buy pressure on the PART token to raise its daily trading volume, attract speculators who will then promote the platform further (after learning about it) and thus speading the network effect and awareness about the marketplace.

• Integration of the currency into the platform also makes it easier to use as it reduces the number of additional trusted third party services required to zero, thus the service is more accessible, secure, safer and convenient.

• XMR and DNM's are currently the way with regards to anonymous, private commerce but the Particl network provides all their services integrated and avoids all their inherent problems.

• A design which encourages convenience (integration of the currency exchange/converter, marketplace listings, escrow service, currency, communications, security features and any additional services required under one client operating on a separate chain).

Compare with centralized marketplace's which have a number of distinct disadvantages:

• Have far higher fees

• Are governed by centralized authorities which can delist or prevent you from listing products for any reason whatsoever without any recourse; this also prevents buyers from being able to purchase things they want

• Contain your sensitive data (credit card information, purchase/sell history, personal information) on centralized servers which means your information can be sold to third-parties, governments or leaked during hacks (Equifax anyone?)

• Have zero network effects -- unless you own stock in Amazon.com you couldn't give two shits about how it operates

 

In contrast decentralized privacy centric MP's do not require personal information, can benefit from leveraging the network effects of speculation (Bitcoin circa 2013 is a perfect example), can have low or zero transaction fee's and protect sellers from premature, unfair or even illegal delisting i.e. protect buyers and sellers from censorship where none is required or where censorship is questionable.

 

• Furthermore the tax implications of cryptocurrency have yet to be determined. PART wouldn't qualify as just a currency as it has features that make it more in keeping with a bond and a share simultaneously (as the token confers governance rights, generates passive income if staked and is used to secure the network + act as bond in it's escrow service). Tax laws specific to an asset class like PART have yet to be clearly defined. I think a large amount of legal white market commerce could run through Particl simply because it potentially represents a more legally tax efficient solution.

• Following on from this I think a large amount of wealth that has moved into cryptocurrency wants to stay there. Thus the general market for legal goods acquired tax efficiently through multiple cryptocurrencies is potentially untapped and could explode as crypto marketcap continues to grow. I think this represents a case for all decentralised marketplaces.

 

This argument in general is the case for decentralization of marketplace technologies and is the main use case for District0x, Openbazaar, Syscoin etc.

By: Joske

Blockstream trying to take over Bitcoin 

BlockstreamLocated in San Francisco, is perhaps the most important and at the same time, the least comprehensive company in the community of Bitcoin-World. 

Bitcoin is an open source software project where everyone can view the code and propose changes, but only a small group of people accompanying the project can approve the changes and run them into the implementation. Blockstreamhas gathered under its wing many of the most experienced and productive developers of the Bitcoin Core team, including Gregory Maxwell, Peter Will, and Matt Corallo, who over the past year together made more than 1,212 contributions to the Bitcoin code on GitHub. For this reason, people working in Blockstream may have the deepest knowledge of crypto protocols and have the greatest impact in the crypto world. 

While the positive influence of many people in the company on Bitcoin is obvious, some people blame the company for the lack of an experimental approach to Bitcoin's development, for the lack of rapid progress at the protocol level over the past few years. 

Bitcoin Core is slow to take risks when it comes to making changes to Bitcoin's code. In particular, Core does not support increasing the block size as fast as some would like. Some in the community are afraid that very soon, the bandwidth of the network will become a bottleneck that hinders the growth of user acceptance, which even led to the emergence of offers of alternative customers and development teams (for example, Bitcoin Unlimited, so ardently supported by Roger Vero). 

Most of these moods stem from the misunderstanding of Bitcoin's governance structure. Bitcoin was described as democratic, but in reality, it does not represent a democratic structure, where government representatives are elected, receiving the right to make decisions. Instead, Bitcoin is a user-controlled system where the code is associated with all network members (developers, miners, users, exchanges). Not any of the groups are able to make significant changes to the protocol. In fact, this requires an absolute majority of votes. This can be considered as a gift, and as a curse at the same time and this makes Bitcoin one of the most invulnerable means of accumulation that ever existed, but this same feature makes it difficult to make changes at the protocol level. 

So what is the role of Blockstream in the ecosystem? 

When the company attracted investments at the zero round of financing, the main idea was that Blockstream would be for Bitcoin that Mozilla was for the Internet: a commercial organization that supports the basic values of the protocol. 

Since the launch of Blockstream, it has passed more than two years now, and it seems that the company has safely forgotten about it The popular opinion is that Blockstream is using its influence on Bitcoin Core to push out the solutions that are beneficial for the company, and not for the Bitcoin ecosystem as a whole. 

The main mission of Blockstream 

The founder of the block stream Adam Back says that he believes in the future, where users are given the right to control their own assets. The mission is to take Bitcoin's core peer security and expand it to other digital assets. 

Back also says that Bitcoin is the most secure and reliable decentralized value transfer network. It runs smoothly for eight years and is based on computing power, larger than the world's largest supercomputer. The network is based on a simple scripting language with the smallest "surface" for potential attacks. Other blockades, such as the Etherium, are interesting experiments, but they do not compare with Bitcoin in terms of reliability, security, and decentralization. 

A woman has appeared in court after trying to pay a darknet assassin in bitcoin to kill her partner. Her attempt failed, not due to high transaction fees or a mempool backlog, but because the hitman was fake. Now, the 58-year-old is facing a possible life sentence for attempted murder.

On The Deep Web, Trust No One

As the adage goes, every teenage girl on the internet is a cop and every darknet hitman is a fraud. Despite this truism having been proven time and again, it hasn't deterred hapless chancers who seem to think that ordering an assassination is as easy as ordering a pizza. In a case that should be filed under "You couldn't make it up", a Danish woman requested a homicide, paid in bitcoin, from a darknet site named Crime Bay.

She Bought a Bullet for Bae on Crime Bay

The site, which purports to be operated by Chechen gangsters, is almost certainly a honeypot or the work of larpers. Such sites have proliferated on the darknet for years, where they've provided cheap thrills for bored web users. To date, there are no confirmed cases of murder successfully solicited via the deep web, although this is naturally hard to verify. Hypothetically, the buyer makes their order and places the fee in bitcoins into an escrow account. Then, as the Crime Bay explains:

The money stays in the escrow until the operative provides video proof of the job. When job is completed, we send to the customer a message with a link to the video proof…The customer can check local news or social media to see that the job has been completed.

Danish Woman Arrested After Paying for a Darknet Hitman With BitcoinFor an aspiring murderer seeking to off their spouse without getting their hands dirty, it all sounds so clean and simple. The reality is anything but. Denmark's DR.dk reports how the woman submitted her address and a photograph of the victim to the site. She also requested that a silencer be used and the job be completed on the first attempt.

A Darkly Comic Saga That Reads Like Cheap Fiction

Predictably, the whole plot unraveled before a muffled bullet could be fired. Full details of how the woman was caught have yet to emerge as the case is still at an early stage. Six prosecution witnesses will be summoned however when the case returns to court later this month. It's the first time Denmark's judicial system has had to deal with an attempted murder incident, fake or not, emanating from the deep web.

There are two likely explanations as to how the 58-year-old woman got caught. Either authorities had compromised the site and were monitoring all communications, or the entire thing was a honeypot. With Denmark's Prosecutor's Office having requested that the woman be sent to Italy to stand trial, it seems that the operators of Crime Bay – be they Chechens or cops – hailed from there.

On the darknet, everyone hides behind a hoodie.

The woman, who could face life in prison if convicted, maintains her innocence and has pled not guilty. Cases such as this illustrate the absurdity of trying to use bitcoin and the deep web to commit any sort of major crime. For low-level offenses, such as purchasing personal quantities of drugs, the darknet and cryptocurrency serve their purpose. Anyone ordering an assassination off a site named Crime Bay, however, deserves everything they get. Bitcoin has a multitude of uses, but it's rubbish for hiring an assassin.

Currently Particl trades in the $5-10 range on Bittrex with a relatively low market cap. Present valuations are determined solely by market speculators (mostly accumulators aware about the project potential).

 

However on release of their decentralised marketplace module in Q1 2018, provided its released with full atomic swaps and shapeshift/exchange integration, it's buy side dynamics will change significantly.

 

This will be driven by the fact that whilst multiple cryptocurrencies will be accepted on the Particl network to automatically convert to the native PART token via in-client integration of shapeshift, decentralized exchanges and widget implementation of atomic swaps (direct conversion of other cryptocurrencies to the native PART token without intermediary if they possess atomic swap functionality), all buying and selling transactions on the marketplace and other Particl modules will be conducted solely via the native PART token.

 

At this stage I estimate a 5x to 20x (conservative is 5x) rise in price purely on a hype cycle alone. Longer term however I view it very differently to other assets due to it's liquidity characteristics which resemble DASH but with actual utility to self perpetuate it. This is because: 

• People decide to use the Particl marketplace.
• People sent their crypto to the Particl client.
• This converts to PART: Buy pressure on PART.
• People buy PART in the Particl client to transact.
• People use PART escrow: PARTs get locked into escrow contract.
• Circulating supply of PART gets further restricted.
• Successful buying/selling of goods = repeat custom exclusively in PART token.
• Repeat custom = regular repeat buy pressure on PART per individual.
• Repeat custom = word of mouth = more new customers on Particl marketplace. This perpetuates first step.
• Buy pressure increases. More escrows. Further liquidity lockup.

 

• More dApps (beyond market place) release as PART hype & awareness increases = more buy pressure on PART.

• Staking locks away PART also restricting circulating supply.

• As value of PART increases incentive to stake increases (as stakers earn tx fees). As PART value increases and tx frequency increases, stakers earn more rewards perpetuating further staking.

• More PART gets locked in staking. Lower circulating supply.

• Rapidly escalating PART price.

 

So provided it is released as described and people use it as a marketplace non-speculatively, with time it's price should rise exponentially independent of traditional exchange dependent model.

...

I hope this makes it super clear why I rank Particl on par with Ethereum and Bitcoin in terms of price growth potential.

By: Joske

China's Financial Channel (CCTV-2) aired a special bitcoin documentary this week to analyze reasons behind the recent price rally. The program invited Li Cangyu, financial columnist and Wan Zhe, chief economist at China National Gold Group Corp. as commentators who believe that Huobi has undoubtedly violated regulations on cryptocurrency services. 

Does Huobi Violate the Spirit of the PBOC's Document?

Earlier this November, CCTV journalist reported that many OTC platforms don't have any KYC requests, which leaves room for illegal activities. The latest documentary exclusively mentioned that Huobi and Huobi.pro have no legal base to provide RMB-related OTC services.

China's Financial Channel Reports that Huobi Violates the Spirit of the PBOC's Document

Log-in to Huobi and one can see that they still use RMB to measure bitcoin and altcoins. At the front page of Huobi.pro, there are a large banner reading "buy coins with RMB, three steps only" along with a detailed guidance teaching newbies how to register and trade with RMB.

When the program aired, many users dashed to Huobi.pro to either withdraw coins or cash out, worrying that the platform will be shut down again.

Why People Buy Bitcoin?

China's Financial Channel Reports that Huobi Violates the Spirit of the PBOC's Document

Wan Zhe

Mainstream media tend to be negative about bitcoin. They often report bitcoin as a tool for money laundering and speculation. But as bitcoin price keeps rising, more people are showing interest in it. Wan Zhe thinks there are three main factors at play.

First, as the stock market is losing traction, people are looking for alternative investments to store their assets and thus switch to bitcoin. Second, though China is tough on the crypto industry, other governments like Japan, Korea and some small countries are friendlier. This makes investors optimistic about bitcoin's future. Third, as more merchants accept bitcoin and big enterprises support the blockchain technology, users hold the belief that bitcoin will become a mainstream currency.

Uncertainties Hanging Over Bitcoin

The documentary ended with some big question marks regarding bitcoin.

Will bitcoin remain decentralized? Wan Zhe explained that mining has become centralized as top mining pools and miners are all based in China. And as individual mining is not so profitable, bitcoin mining might be monopolized by some giant companies in the future.  Will users still support it if decentralization were weakened?

Will bitcoin evolve into a global currency? Though bitcoin itself is not a bubble, but it contains many bubbles, which makes it far less competitive to fiat money. Li Cangyu noted that the issuance of a national currency is a symbol of sovereignty and economic decision-making freedom. He believes that no governments will give up these to use bitcoin.

When will the bitcoin price crash? In the 1720s, Isaac Newton lost 20,000 pounds due to his speculation in the South Sea Company stock. He initially invested around £3,500 and sold out when he doubled his money. But he was induced to get back into the market at the height of the bubble. Later Newton said: "I can calculate the motions of heavenly bodies, but not the madness of people."

Li Cangyu cited Isaac Newton's story to warn bitcoin investors that nobody knows who will be the last participnats. "They think they are on a sure thing only to have it blow up."