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RE: Are Most Cryptocurrencies Doomed to Collapse — because they’re “ICO-issued”?

in #cryptocurrency7 years ago

I found some sources pertaining to Davos and coordinated crackdowns contemplated…

https://www.theguardian.com/business/2018/feb/05/lloyds-bank-bans-buying-bitcoins-credit-cards

The move follows warnings by regulators in the US, South Korea, China, Russia and India. Germany’s Bundesbank has also called for global regulation of bitcoin and France’s finance minister wants tougher rules for cryptocurrencies.

https://www.theguardian.com/technology/2018/jan/23/bitcoin-ubs-chairman-warns-against-cryptocurrency-investment-currency-falls

Talking at the Davos world economic forum, UBS Chairman Axel Weber, said that bitcoin and other cryptocurrencies were speculative, risky and “not an investment we would advise”.

“Retail clients, who don’t fully understand these products, should be protected from going into these products, because if there is a retail client affected in the future, the question will be again who was the bank that sold them these products and then banks will be blamed again for what has happened,” Weber told CNBC.
[…]
Consultancy Ernst & Young also warned Monday that so-called initial coin offerings (ICOs), which offer cryptocurrency tokens to raise funds, were at risk of cybercrime. Of the 372 ICOs analysed, raising a total of $3.7bn, roughly $400m had been stolen by hackers, who were taking up to $1.5m in ICO proceeds per month.

The warnings of theft from ICOs come as the chair of the US Securities and Exchange Commission, Jay Clayton, said the agency had seen “disturbing” evidence that investors in ICOs had been counselled that they did not need to comply with federal securities law.

“I have instructed the SEC staff to be on high alert for approaches to ICOs that may be contrary to the spirit of our securities laws and the professional obligations of the US securities bar,” Clayton said.

But note the reality that cryptocurrency and decentralized ledgers are on the way to subsuming everything:

Firms including camera-maker Kodak, fintech firm LongFin, power firm Digital Power, tobacco company Rich Cigars, tiny US drinks firm Long Island Iced Tea Corp and many other smaller companies have all seen their share price rocket through pivots towards cryptocurrencies or blockchain technology.

https://www.theguardian.com/business/2018/jan/25/bitcoin-wont-last-in-world-of-finance-warns-nobel-winning-economist

Theresa May said in Davos that she was concerned that criminals were taking advantage of digital currencies, which can be used to anonymously transfer funds. “In areas like cryptocurrencies, like bitcoin, we should be looking at these very seriously,” May told Bloomberg.

The US treasury secretary, Steven Mnuchin, also flagged up concerns about misuse of digital currencies. “My number one focus on cryptocurrencies, whether that be digital currencies or bitcoin or other things, is that we want to make sure that they’re not used for illicit activities,” Mnuchin told CNBC. “So in the US our regulations [say] if you’re a bitcoin wallet, you’re subject to the same regulations as a bank.”
[…]
Digital currencies have been a key topic of conversation at Davos. Ethereum, a rival to bitcoin, has set up its own lounge on the main promenade of the ski resort. Banks are showing particular interest in the blockchain – the digital ledger that underpins a cryptocurrency.

Note there was at least one voice of reason there, who understands my thesis (although not the conspiratorial angle of my thesis):

However, some investors at Davos disputed the idea that bitcoin faced a rocky future. Jennifer Zhu Scott, of Radian Partners, said bitcoin was a “very lousy currency” and a “very lousy payment system” but insisted that it worked as an asset. “I don’t think bitcoin is disrupting currency or money. Bitcoin is disrupting gold,” she said.

Zhu argued that bitcoin was extremely efficient as a store of value, as there could only ever be 21m in circulation – and only about 16m have been created so far.

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