CEO of ShapeShift Erik Voorhees in an interview, expressed his views that bitcoin and crypto price bubbles are a definite part of their chronology. There have been crypto bubbles of immense magnitude in the past, and they have amused crypto analysts who have tried to dig out the importance of these incidents.
The past price bubbles of bitcoin also show us that prices do not matter unless the crypto is strong enough to maintain them. Now that bitcoin has reached up to a recent high of $8,000, Voorhees is anticipating another bitcoin bubble.
There have to be bubbles in crypto because crypto is taking over the world, and it’s not going to just advance 5% a month without end. If it did that, people would start buying it up and frontrunning it and turning it into a bubble. So there’s no way to go from a zero dollar asset to one that is worth trillions without massive speculation and massive volatility and cyclical bubbles.
Voorhees is of the view that the crypto market is not always bullish in a regular pattern, lets say increasing by 5% on a monthly basis. He said that there are bearish trends as well which is why bubbles happen after a certain time. Bubbles appear when people buy bitcoins, reserve them and then sell them, creating a rush of people who want to buy them.
READ ALSO: After $10k Bitcoin (BTC) Price, ‘FOMO’ Will Make it the Biggest ‘Crypto Bull Run’
The bubble logic means that bitcoin shoots up for a rather short period of time and then turns dormant again as the prices fall down. The host of Crypto Trader, Ran NeuNer, has previously stated that if the bitcoin was a bubble, we wouldn’t have seen its resurgence at all. While this seems to be closer to truth, several critics have jumped in claiming that the bubble logic fits when we take several intervals out of bitcoin price chronology.
The critics calling bitcoin just a bubble in their publications do not hold water at all and I don’t have any respect for this opinion. Let’s say bitcoin WAS a bubble, it couldn’t have popped twice.
NeuNer, a bitcoin maximalist, claims that bitcoin is a healthy market and is worth investing in. He further clarified that we have seen bitcoin emerge from the darkest of times, witnessed a bear market and then booming to the strongest of bullish behavior. This is not what a bubble refers to at all, as per NeuNer. The reason behind NeuNer backed bitcoin is that even after the longest bear market of recent times, bitcoin is now shooting up. The cryptocurrency has reached to recent highs of a little over $8,000 with speculations that there is another bull run on the way.
READ ALSO: ‘Millennials Love Bitcoin’ But They Should Learn About Gold ‘Love Trade’
There have been four bubbles in bitcoin’s history till now, according to Barry Silbert, founder and chief executive officer for the Digital Currency Group. The first can be tracked back to 2011 when the bitcoin price surged to $31 and then fell down to a low of $2. The second bitcoin bull run witnessed bitcoin jump to $259 and fall down to $45. The third bitcoin bull run saw the crypto’s price surge to $1,141 and collapse to $152. The last bull run happened in the fourth quarter of 2017 when bitcoin sent the whole world into a frenzy by reaching $20,000 price point, but later struck to a low of $4,050. If we look closely at the crypto bubble pattern, we can notice that the high point in price keeps getting considerably greater, which is a good sign for traders.
READ ALSO: 3 Reasons Why 2019 Bitcoin (BTC) Bull Run Will be Longer
Bubbles benefit several entities ranging from investors to a normal user. Whenever a bubble appears, it is the best time for investors and public to invest and jump into the crypto market. However, bubbles also happen to appear when a crypto is either weak or is facing scandals or scams. Bitcoin bubbles happened mostly because crypto reforms are still undecided, with people wondering about the future of bitcoin. Nevertheless, bubbles also bring newer heights as they allow cryptos to find a new direction and attain stability, weeding out the weak points.
READ ALSO: Bitcoin (BTC) Comeback to $8000 Signals a Crypto Bull Run
Bitcoin has reached the highs of $8,000 recently, sparking speculations that another bubble is on its way. The next few weeks are going to be very interesting for the crypto world as it might just set a new direction for bitcoin.
Bitcoin Defies Correction Calls, Where Will BTC Go Next?
Bitcoin’s epic weekend pump has continued into Monday as gains are holding. BTC is still above $9k but has hit resistance once again. Analysts and traders are looking for its next move and some are now eyeing altcoins for bigger gains.
Bitcoin surged through resistance yesterday to record a new 13 month high of just north of $9,300. The move resulted in 8 percent on the day for BTC has it pumped from around $8,600 to its highest price of 2019. A small pullback occurred but it retested this price a few hours later forming a double top on the day.
A larger pullback then took Bitcoin back down to $8,850 but it has since recovered again and is heading upwards during the morning’s Asian trading session. At the time of writing BTC was trading at $9,100, marginally higher than yesterday morning.
Daily volume has also pumped back up to $23 billion taking Bitcoin’s market capitalization to $162 billion, higher than that of the total crypto market back in March. Bitcoin market cap has not been this high since May 2018.
What is Next For Bitcoin?
Traders and analysts have been looking at the Ichimoku Cloud, which is a collection of technical indicators that show support and resistance levels, as well as momentum and trend direction. The weekly candle has opened inside the cloud which is bullish and could result in further upwards momentum;
“$BTC – found resistance right at the lower cloud and has opened the weekly candle inside the cloud. This represents the highest time frame that #bitcoin has breached into the cloud…with resistance at just above $10K…”
Looking at next moves for BTC, the analyst added;
“one more step up the mountain as #bitcoin hits right at the 38.2% fib resistance making it the next target for the bulls to close over and also makes maintaining the 23.6 fib support that much more important for overall continuation…”
The 38.2% Fib level is pretty much were BTC reached during May last year when it started to fall from over $9k so this does form a natural resistance level. It is an obvious take profit zone so could well be tested again with a bounce to the low side.
Current chart patterns are mirroring those from previous market cycles which could also give indication as to where Bitcoin will go next. Trader ‘CryptoHamster’ pulled out a chart from the 2013 bull run which shows similarities with what is occurring now;
Many have been waiting for a correction back to $6k but this is looking more distant as the days go by and Bitcoin continues to make new 2019 highs. A big 30 percent plus dump from current levels will drop BTC back to $6,400 which, coincidentally, was the most traded price in 2018. But as we have seen, BTC has done the opposite several times this year, as predicted late last week the consolidation crackedwith Bitcoin’s latest move.
Bitmain Lawsuit Seeks Millions from Staffers Who Founded Rival Mining Pool
- Bitmain is suing three former employees who started Poolin, a rival to the chip manufacturer’s BTC.com mining pool.
- The company is seeking $4 million in damages, alleging the Poolin co-founders violated their non-compete agreements; The former employees say Bitmain voided the non-compete by failing to pay them on time as agreed.
- The case offers a rare window on Bitmain’s inner-workings and employment practices.
Cryptocurrency mining giant Bitmain is locked in a legal battle with three former employees who started a rival mining pool.
Bitmain, the owner of BTC.com, the world’s top bitcoin mining pool by hash rate, is suing the co-founders of Poolin, the seventh-largest pool, for allegedly violating a non-compete agreement – and it’s demanding $4.3 million in damages from one of them.
For their part, the three Poolin co-founders say they were no longer bound by the non-compete, since it was Bitmain that invalidated their contracts for failing to pay compensation on time as agreed.
The case offers a rare window on the inner workings and employment practices of Bitmain, one of the blockchain industry’s largest and most powerful companies.
Bitmain makes most of its money from selling mining equipment, according to financials disclosed during the firm’s abortive attempt to go public. But it also operates mining pools, essentially software products miners use to split rewards. This service accounted for $43.2 million of Bitmain’s revenues in the first half of 2018, the most recent period for which data is available, compared to $2.7 billion of hardware sales during the same period.
There are six lawsuits pending in the Beijing Haidian District court. The three Poolin co-founders – CEO Zhibiao Pan; COO Fa Zhu; and CTO Tianzhao Li – each sued Bitmain preemptively, seeking to be released from the non-compete.
Bitmain, in turn, countersued each of them, claiming they caused significant losses to the company after leaving by operating a directly competing pool. Aside from seeking damages, Bitmain asked the court to order the Poolin executives to resume honoring the non-compete agreement.
The dispute has largely escaped public notice, but video footage recently became available of an April 30 hearing where the two sides made their respective cases. The video only showed discussion of the case between Pan and Bitmain. As such, exact details regarding the other two former employees were not clear until now.
The birth of BTC.com
The main dispute in these cases boils down to the roles the three Poolin founders played in Bitmain’s flagship mining pool BTC.com, and the non-compete agreements they signed when they decided to leave Bitmain.
In a WeChat post written by Zhu and published by a Chinese crypto media outlet in January commemorating bitcoin’s 10-year anniversary, he briefly recounted the trio’s work at Bitmain.
Zhu wrote that back in 2015, the three – while still focusing on Bitmain’s original mining pool, Antpool – proposed to launch BTC.com as a parallel service within Bitmain.
The idea was not initially supported by Bitmain, Zhu wrote, and the three had to develop and roll it out on their own using Pan’s own capital at the beginning. In 2016, Pan open-sourced the code of BTC.com, which helped lower the threshold for anyone that’s interested in launching a mining pool business.
The three collaborators left Bitmain around mid-2017. Under the non-compete agreement, Bitmain would pay monthly compensation to Pan after his departure of about $2,780 for 24 months, and in return, prohibit him from specifically operating a bitcoin mining pool. The compensation for the other two under such agreements was not clear from the court video.
After their departure from Bitmain, Pan, Zhu and Li launched Poolin as mining pool for multiple cryptocurrency assets in November 2017. They didn’t launch a pool service for bitcoin until July 2018, when they mined Poolin’s first block of the largest cryptocurrency by market cap.
It has since grown into one of the largest bitcoin mining pools. Based on facts agreed on by both sides of the case and presented to the court, as of Feb. 14, Poolin was the third biggest operation by hash rate in the world, after BTC.com and AntPool. All told, miners connected to Poolin had mined 26,825 bitcoin, worth $220 million at today’s prices.
Notably, Poolin’s share of the hash rate has dropped since then to about 8.2 percent, and its rank has fallen to No. 7, based on the current distribution of bitcoin’s network computation.
Bitmain cries foul
Subsequently, Bitmain alleged that such conduct violated the non-compete agreement, and demanded that Pan return all the paid compensation, as well as a fine of $667,000 for reneging.
Further, Bitmain’s lawyers argued at the hearing that the revenues Poolin generated from mining the 26,825 bitcoin should be considered a profit made by violating the agreement, which should be paid back as a loss to Bitmain.
“Based on the agreement, if it’s difficult to calculate all the direct and indirect loss [for Bitmain due to Poolin’s violation], then the loss should be calculated based on the profits made by the violating party,” one of the lawyers said.
“As of Feb. 14, the total profits for Poolin would be 26,825 bitcoin times 4 percent, which was their handling fee, and times bitcoin’s price at the time, which was 24,518 yuan [$3,500],” the lawyer argued.
That, added to the alleged fine, would amount to more than 30 million yuan, or about $4.3 million.
Poolin pushes back
But lawyers representing the Poolin founders argued to the court that Pan was not obligated to honor the agreement and thus should not be ordered to pay damages.
Pan’s lawyers said in the hearing that Bitmain failed to pay Pan the agreed-upon compensation on time, citing lines from the agreement that if Party A (Bitmain) did not pay the compensation within a month since Party B (Pan)’s departure, it would mean Party A voided its obligation.
Further, Pan’s lawyers argued the transaction fee Poolin received doesn’t necessarily translate to profits of the company because until the date of the hearing, the firm had not turned a profit. In addition, the fact that Poolin successfully mined 26,825 bitcoin also does not necessarily mean it would be a loss for BTC.com, the lawyer said.
“There are a lot more bitcoin mining pools in this network. It’s not just Poolin v.s. BTC.com. Even if Poolin didn’t operate its bitcoin mining pool, it does not necessarily mean Bitmain will be able to mine those coins.” the lawyer argued.
So far, it’s not yet clear from the public record whether the court has made a judgment or when it will. The judge asked at the end of the hearing if there was a way for the two parties to settle the case. Lawyers from Bitmain declined to discuss that at the court and suggested waiting until after the hearing adjourned.
Bitmain declined to comment or provide further clarification on the status of the cases. Poolin executives did not respond to CoinDesk’s inquiries by press time.
This is not the first time Bitmain has had a legal dispute with former senior executives. In 2017, it suedZuoxing Yang, a former Bitmain chip design director who left to launch Bitewei, a rival mining equipment manufacturer, over patent rights infringement.
Bitmain initially demanded damages of 26 billion yuan, or $3.8 billion, but later reduced the claim to $380,000. In 2018, the court in Xinjiang that oversaw the case dismissed Bitmain’s complaint after Yang successfully revoked Bitmain’s patent over the technology in dispute.
Bitcoin Cash (BCHUSD) weekly forecast on June 17 — 23, 2019
Cryptocurrency Bitcoin Cash (BCH/USD) is trading at 429. Cryptocurrency quotes are trading above the moving average with a period of 55. This indicates a bullish trend on Bitcoin Cash. At the moment, cryptocurrency quotes are moving near the middle border of the Bollinger Bands indicator.
Bitcoin Cash (BCHUSD) weekly forecast on June 17 — 23, 2019
As part of the Bitcoin Cash forecast, the test is expected to level 410. Where should we expect an attempt to continue the growth of BCH/USD and further development of the upward trend. The purpose of this movement is the area near the level of 570. The conservative area for buying of Bitcoin Cash is located near the lower border of the Bollinger Bands indicator at the level of 370.
Cancellation of the option to continue the growth rate of Bitcoin Cash will be the breakdown of the area of the lower border of the Bollinger Bands indicator bands. As well as the moving average with a period of 55 and closing of quotations of the pair below the area of 350. This will indicate a change in the current trend in favor of a bearish for BCH/USD. In case of a breakdown of the upper border of the Bollinger Bands indicator bars, one should expect an acceleration of the fall of the cryptocurrency.
Bitcoin Cash (BCHUSD) weekly forecast on June 17 — 23, 2019implies a test level of 410. Further growth is expected to continue to the area above the level of 570. The conservative area for buying Bitcoin Cash is located area of 370. Cancellation of the growth option of cryptocurrency will be a breakdown of the level of 350. In this case, we should expect a further fall.