Chaos, randomness and multi-fractality in Bitcoin market

Where is Bitcoin Going and When?

Where is Bitcoin Going and When?

The Federal Reserve and the United States government are pumping extreme amounts of money into the economy, already totaling over $484 billion. They are doing so because it already had a goal to inflate the United States Dollar (USD) so that the market can continue to all-time highs. It has always had this goal. They do not care how much inflation goes up by now as we are going into a depression with the potential to totally crash the US economy forever. They believe the only way to save the market from going to zero or negative values is to inflate it so much that it cannot possibly crash that low. Even if the market does not dip that low, inflation serves the interest of powerful people.
The impending crash of the stock market has ramifications for Bitcoin, as, though there is no direct ongoing-correlation between the two, major movements in traditional markets will necessarily affect Bitcoin. According to the Blockchain Center’s Cryptocurrency Correlation Tool, Bitcoin is not correlated with the stock market. However, when major market movements occur, they send ripples throughout the financial ecosystem which necessary affect even ordinarily uncorrelated assets.
Therefore, Bitcoin will reach X price on X date after crashing to a price of X by X date.

Stock Market Crash

The Federal Reserve has caused some serious consternation with their release of ridiculous amounts of money in an attempt to buoy the economy. At face value, it does not seem to have any rationale or logic behind it other than keeping the economy afloat long enough for individuals to profit financially and politically. However, there is an underlying basis to what is going on which is important to understand in order to profit financially.
All markets are functionally price probing systems. They constantly undergo a price-discovery process. In a fiat system, money is an illusory and a fundamentally synthetic instrument with no intrinsic value – similar to Bitcoin. The primary difference between Bitcoin is the underlying technology which provides a slew of benefits that fiat does not. Fiat, however, has an advantage in being able to have the support of powerful nation-states which can use their might to insure the currency’s prosperity.
Traditional stock markets are composed of indices (pl. of index). Indices are non-trading market instruments which are essentially summaries of business values which comprise them. They are continuously recalculated throughout a trading day, and sometimes reflected through tradable instruments such as Exchange Traded Funds or Futures. Indices are weighted by market capitalizations of various businesses.
Price theory essentially states that when a market fails to take out a new low in a given range, it will have an objective to take out the high. When a market fails to take out a new high, it has an objective to make a new low. This is why price-time charts go up and down, as it does this on a second-by-second, minute-by-minute, day-by-day, and even century-by-century basis. Therefore, market indices will always return to some type of bull market as, once a true low is formed, the market will have a price objective to take out a new high outside of its’ given range – which is an all-time high. Instruments can only functionally fall to zero, whereas they can grow infinitely.
So, why inflate the economy so much?
Deflation is disastrous for central banks and markets as it raises the possibility of producing an overall price objective of zero or negative values. Therefore, under a fractional reserve system with a fiat currency managed by a central bank – the goal of the central bank is to depreciate the currency. The dollar is manipulated constantly with the intention of depreciating its’ value.
Central banks have a goal of continued inflated fiat values. They tend to ordinarily contain it at less than ten percent (10%) per annum in order for the psyche of the general populace to slowly adjust price increases. As such, the markets are divorced from any other logic. Economic policy is the maintenance of human egos, not catering to fundamental analysis. Gross Domestic Product (GDP) growth is well-known not to be a measure of actual growth or output. It is a measure of increase in dollars processed. Banks seek to produce raising numbers which make society feel like it is growing economically, making people optimistic. To do so, the currency is inflated, though inflation itself does not actually increase growth. When society is optimistic, it spends and engages in business – resulting in actual growth. It also encourages people to take on credit and debts, creating more fictional fiat.
Inflation is necessary for markets to continue to reach new heights, generating positive emotional responses from the populace, encouraging spending, encouraging debt intake, further inflating the currency, and increasing the sale of government bonds. The fiat system only survives by generating more imaginary money on a regular basis.
Bitcoin investors may profit from this by realizing that stock investors as a whole always stand to profit from the market so long as it is managed by a central bank and does not collapse entirely. If those elements are filled, it has an unending price objective to raise to new heights. It also allows us to realize that this response indicates that the higher-ups believe that the economy could crash in entirety, and it may be wise for investors to have multiple well-thought-out exit strategies.

Economic Analysis of Bitcoin

The reason why the Fed is so aggressively inflating the economy is due to fears that it will collapse forever or never rebound. As such, coupled with a global depression, a huge demand will appear for a reserve currency which is fundamentally different than the previous system. Bitcoin, though a currency or asset, is also a market. It also undergoes a constant price-probing process. Unlike traditional markets, Bitcoin has the exact opposite goal. Bitcoin seeks to appreciate in value and not depreciate. This has a quite different affect in that Bitcoin could potentially become worthless and have a price objective of zero.
Bitcoin was created in 2008 by a now famous mysterious figure known as Satoshi Nakamoto and its’ open source code was released in 2009. It was the first decentralized cryptocurrency to utilize a novel protocol known as the blockchain. Up to one megabyte of data may be sent with each transaction. It is decentralized, anonymous, transparent, easy to set-up, and provides myriad other benefits. Bitcoin is not backed up by anything other than its’ own technology.
Bitcoin is can never be expected to collapse as a framework, even were it to become worthless. The stock market has the potential to collapse in entirety, whereas, as long as the internet exists, Bitcoin will be a functional system with a self-authenticating framework. That capacity to persist regardless of the actual price of Bitcoin and the deflationary nature of Bitcoin means that it has something which fiat does not – inherent value.
Bitcoin is based on a distributed database known as the “blockchain.” Blockchains are essentially decentralized virtual ledger books, replete with pages known as “blocks.” Each page in a ledger is composed of paragraph entries, which are the actual transactions in the block.
Blockchains store information in the form of numerical transactions, which are just numbers. We can consider these numbers digital assets, such as Bitcoin. The data in a blockchain is immutable and recorded only by consensus-based algorithms. Bitcoin is cryptographic and all transactions are direct, without intermediary, peer-to-peer.
Bitcoin does not require trust in a central bank. It requires trust on the technology behind it, which is open-source and may be evaluated by anyone at any time. Furthermore, it is impossible to manipulate as doing so would require all of the nodes in the network to be hacked at once – unlike the stock market which is manipulated by the government and “Market Makers”. Bitcoin is also private in that, though the ledge is openly distributed, it is encrypted. Bitcoin’s blockchain has one of the greatest redundancy and information disaster recovery systems ever developed.
Bitcoin has a distributed governance model in that it is controlled by its’ users. There is no need to trust a payment processor or bank, or even to pay fees to such entities. There are also no third-party fees for transaction processing. As the ledge is immutable and transparent it is never possible to change it – the data on the blockchain is permanent. The system is not easily susceptible to attacks as it is widely distributed. Furthermore, as users of Bitcoin have their private keys assigned to their transactions, they are virtually impossible to fake. No lengthy verification, reconciliation, nor clearing process exists with Bitcoin.
Bitcoin is based on a proof-of-work algorithm. Every transaction on the network has an associated mathetical “puzzle”. Computers known as miners compete to solve the complex cryptographic hash algorithm that comprises that puzzle. The solution is proof that the miner engaged in sufficient work. The puzzle is known as a nonce, a number used only once. There is only one major nonce at a time and it issues 12.5 Bitcoin. Once it is solved, the fact that the nonce has been solved is made public.
A block is mined on average of once every ten minutes. However, the blockchain checks every 2,016,000 minutes (approximately four years) if 201,600 blocks were mined. If it was faster, it increases difficulty by half, thereby deflating Bitcoin. If it was slower, it decreases, thereby inflating Bitcoin. It will continue to do this until zero Bitcoin are issued, projected at the year 2140. On the twelfth of May, 2020, the blockchain will halve the amount of Bitcoin issued when each nonce is guessed. When Bitcoin was first created, fifty were issued per block as a reward to miners. 6.25 BTC will be issued from that point on once each nonce is solved.
Unlike fiat, Bitcoin is a deflationary currency. As BTC becomes scarcer, demand for it will increase, also raising the price. In this, BTC is similar to gold. It is predictable in its’ output, unlike the USD, as it is based on a programmed supply. We can predict BTC’s deflation and inflation almost exactly, if not exactly. Only 21 million BTC will ever be produced, unless the entire network concedes to change the protocol – which is highly unlikely.
Some of the drawbacks to BTC include congestion. At peak congestion, it may take an entire day to process a Bitcoin transaction as only three to five transactions may be processed per second. Receiving priority on a payment may cost up to the equivalent of twenty dollars ($20). Bitcoin mining consumes enough energy in one day to power a single-family home for an entire week.

Trading or Investing?

The fundamental divide in trading revolves around the question of market structure. Many feel that the market operates totally randomly and its’ behavior cannot be predicted. For the purposes of this article, we will assume that the market has a structure, but that that structure is not perfect. That market structure naturally generates chart patterns as the market records prices in time. In order to determine when the stock market will crash, causing a major decline in BTC price, we will analyze an instrument, an exchange traded fund, which represents an index, as opposed to a particular stock. The price patterns of the various stocks in an index are effectively smoothed out. In doing so, a more technical picture arises. Perhaps the most popular of these is the SPDR S&P Standard and Poor 500 Exchange Traded Fund ($SPY).
In trading, little to no concern is given about value of underlying asset. We are concerned primarily about liquidity and trading ranges, which are the amount of value fluctuating on a short-term basis, as measured by volatility-implied trading ranges. Fundamental analysis plays a role, however markets often do not react to real-world factors in a logical fashion. Therefore, fundamental analysis is more appropriate for long-term investing.
The fundamental derivatives of a chart are time (x-axis) and price (y-axis). The primary technical indicator is price, as everything else is lagging in the past. Price represents current asking price and incorrectly implementing positions based on price is one of the biggest trading errors.
Markets and currencies ordinarily have noise, their tendency to back-and-fill, which must be filtered out for true pattern recognition. That noise does have a utility, however, in allowing traders second chances to enter favorable positions at slightly less favorable entry points. When you have any market with enough liquidity for historical data to record a pattern, then a structure can be divined. The market probes prices as part of an ongoing price-discovery process. Market technicians must sometimes look outside of the technical realm and use visual inspection to ascertain the relevance of certain patterns, using a qualitative eye that recognizes the underlying quantitative nature
Markets and instruments rise slower than they correct, however they rise much more than they fall. In the same vein, instruments can only fall to having no worth, whereas they could theoretically grow infinitely and have continued to grow over time. Money in a fiat system is illusory. It is a fundamentally synthetic instrument which has no intrinsic value. Hence, the recent seemingly illogical fluctuations in the market.
According to trade theory, the unending purpose of a market or instrument is to create and break price ranges according to the laws of supply and demand. We must determine when to trade based on each market inflection point as defined in price and in time as opposed to abandoning the trend (as the contrarian trading in this sub often does). Time and Price symmetry must be used to be in accordance with the trend. When coupled with a favorable risk to reward ratio, the ability to stay in the market for most of the defined time period, and adherence to risk management rules; the trader has a solid methodology for achieving considerable gains.
We will engage in a longer term market-oriented analysis to avoid any time-focused pressure. The Bitcoin market is open twenty-four-hours a day, so trading may be done when the individual is ready, without any pressing need to be constantly alert. Let alone, we can safely project months in advance with relatively high accuracy. Bitcoin is an asset which an individual can both trade and invest, however this article will be focused on trading due to the wide volatility in BTC prices over the short-term.

Technical Indicator Analysis of Bitcoin

Technical indicators are often considered self-fulfilling prophecies due to mass-market psychology gravitating towards certain common numbers yielded from them. They are also often discounted when it comes to BTC. That means a trader must be especially aware of these numbers as they can prognosticate market movements. Often, they are meaningless in the larger picture of things.
  • Volume – derived from the market itself, it is mostly irrelevant. The major problem with volume for stocks is that the US market open causes tremendous volume surges eradicating any intrinsic volume analysis. This does not occur with BTC, as it is open twenty-four-seven. At major highs and lows, the market is typically anemic. Most traders are not active at terminal discretes (peaks and troughs) because of levels of fear. Volume allows us confidence in time and price symmetry market inflection points, if we observe low volume at a foretold range of values. We can rationalize that an absolute discrete is usually only discovered and anticipated by very few traders. As the general market realizes it, a herd mentality will push the market in the direction favorable to defending it. Volume is also useful for swing trading, as chances for swing’s validity increases if an increase in volume is seen on and after the swing’s activation. Volume is steadily decreasing. Lows and highs are reached when volume is lower.
Therefore, due to the relatively high volume on the 12th of March, we can safely determine that a low for BTC was not reached.
  • VIX – Volatility Index, this technical indicator indicates level of fear by the amount of options-based “insurance” in portfolios. A low VIX environment, less than 20 for the S&P index, indicates a stable market with a possible uptrend. A high VIX, over 20, indicates a possible downtrend. VIX is essentially useless for BTC as BTC-based options do not exist. It allows us to predict the market low for $SPY, which will have an indirect impact on BTC in the short term, likely leading to the yearly low. However, it is equally important to see how VIX is changing over time, if it is decreasing or increasing, as that indicates increasing or decreasing fear. Low volatility allows high leverage without risk or rest. Occasionally, markets do rise with high VIX.
As VIX is unusually high, in the forties, we can be confident that a downtrend for the S&P 500 is imminent.
  • RSI (Relative Strength Index): The most important technical indicator, useful for determining highs and lows when time symmetry is not availing itself. Sometimes analysis of RSI can conflict in different time frames, easiest way to use it is when it is at extremes – either under 30 or over 70. Extremes can be used for filtering highs or lows based on time-and-price window calculations. Highly instructive as to major corrective clues and indicative of continued directional movement. Must determine if longer-term RSI values find support at same values as before. It is currently at 73.56.
  • Secondly, RSI may be used as a high or low filter, to observe the level that short-term RSI reaches in counter-trend corrections. Repetitions based on market movements based on RSI determine how long a trade should be held onto. Once a short term RSI reaches an extreme and stay there, the other RSI’s should gradually reach the same extremes. Once all RSI’s are at extreme highs, a trend confirmation should occur and RSI’s should drop to their midpoint.

Trend Definition Analysis of Bitcoin

Trend definition is highly powerful, cannot be understated. Knowledge of trend logic is enough to be a profitable trader, yet defining a trend is an arduous process. Multiple trends coexist across multiple time frames and across multiple market sectors. Like time structure, it makes the underlying price of the instrument irrelevant. Trend definitions cannot determine the validity of newly formed discretes. Trend becomes apparent when trades based in counter-trend inflection points continue to fail.
Downtrends are defined as an instrument making lower lows and lower highs that are recurrent, additive, qualified swing setups. Downtrends for all instruments are similar, except forex. They are fast and complete much quicker than uptrends. An average downtrend is 18 months, something which we will return to. An uptrend inception occurs when an instrument reaches a point where it fails to make a new low, then that low will be tested. After that, the instrument will either have a deep range retracement or it may take out the low slightly, resulting in a double-bottom. A swing must eventually form.
A simple way to roughly determine trend is to attempt to draw a line from three tops going upwards (uptrend) or a line from three bottoms going downwards (downtrend). It is not possible to correctly draw a downtrend line on the BTC chart, but it is possible to correctly draw an uptrend – indicating that the overall trend is downwards. The only mitigating factor is the impending stock market crash.

Time Symmetry Analysis of Bitcoin

Time is the movement from the past through the present into the future. It is a measurement in quantified intervals. In many ways, our perception of it is a human construct. It is more powerful than price as time may be utilized for a trade regardless of the market inflection point’s price. Were it possible to perfectly understand time, price would be totally irrelevant due to the predictive certainty time affords. Time structure is easier to learn than price, but much more difficult to apply with any accuracy. It is the hardest aspect of trading to learn, but also the most rewarding.
Humans do not have the ability to recognize every time window, however the ability to define market inflection points in terms of time is the single most powerful trading edge. Regardless, price should not be abandoned for time alone. Time structure analysis It is inherently flawed, as such the markets have a fail-safe, which is Price Structure. Even though Time is much more powerful, Price Structure should never be completely ignored. Time is the qualifier for Price and vice versa. Time can fail by tricking traders into counter-trend trading.
Time is a predestined trade quantifier, a filter to slow trades down, as it allows a trader to specifically focus on specific time windows and rest at others. It allows for quantitative measurements to reach deterministic values and is the primary qualifier for trends. Time structure should be utilized before price structure, and it is the primary trade criterion which requires support from price. We can see price structure on a chart, as areas of mathematical support or resistance, but we cannot see time structure.
Time may be used to tell us an exact point in the future where the market will inflect, after Price Theory has been fulfilled. In the present, price objectives based on price theory added to possible future times for market inflection points give us the exact time of market inflection points and price.
Time Structure is repetitions of time or inherent cycles of time, occurring in a methodical way to provide time windows which may be utilized for inflection points. They are not easily recognized and not easily defined by a price chart as measuring and observing time is very exact. Time structure is not a science, yet it does require precise measurements. Nothing is certain or definite. The critical question must be if a particular approach to time structure is currently lucrative or not.
We will measure it in intervals of 180 bars. Our goal is to determine time windows, when the market will react and when we should pay the most attention. By using time repetitions, the fact that market inflection points occurred at some point in the past and should, therefore, reoccur at some point in the future, we should obtain confidence as to when SPY will reach a market inflection point. Time repetitions are essentially the market’s memory. However, simply measuring the time between two points then trying to extrapolate into the future does not work. Measuring time is not the same as defining time repetitions. We will evaluate past sessions for market inflection points, whether discretes, qualified swings, or intra-range. Then records the times that the market has made highs or lows in a comparable time period to the future one seeks to trade in.
What follows is a time Histogram – A grouping of times which appear close together, then segregated based on that closeness. Time is aligned into combined histogram of repetitions and cycles, however cycles are irrelevant on a daily basis. If trading on an hourly basis, do not use hours.
  • Yearly Lows (last seven years): 1/1/13, 4/10/14, 1/15/15, 1/17/16, 1/1/17, 12/15/18, 2/6/19
  • Monthly Mode: 1, 1, 1, 1, 2, 4, 12
  • Daily Mode: 1, 1, 6, 10, 15, 15, 17
  • Monthly Lows (for the last year): 3/12/20 (10:00pm), 2/28/20 (7:09am), 1/2/20 (8:09pm), 12/18/19 (8:00am), 11/25/19 (1:00am), 10/24/19 (2:59am), 9/30/19 (2:59am), 8/29,19 (4:00am), 7/17/19 (7:59am), 6/4/19 (5:59pm), 5/1/19 (12:00am), 4/1/19 (12:00am)
  • Daily Lows Mode for those Months: 1, 1, 2, 4, 12, 17, 18, 24, 25, 28, 29, 30
  • Hourly Lows Mode for those Months (Military time): 0100, 0200, 0200, 0400, 0700, 0700, 0800, 1200, 1200, 1700, 2000, 2200
  • Minute Lows Mode for those Months: 00, 00, 00, 00, 00, 00, 09, 09, 59, 59, 59, 59
  • Day of the Week Lows (last twenty-six weeks):
Weighted Times are repetitions which appears multiple times within the same list, observed and accentuated once divided into relevant sections of the histogram. They are important in the presently defined trading time period and are similar to a mathematical mode with respect to a series. Phased times are essentially periodical patterns in histograms, though they do not guarantee inflection points
Evaluating the yearly lows, we see that BTC tends to have its lows primarily at the beginning of every year, with a possibility of it being at the end of the year. Following the same methodology, we get the middle of the month as the likeliest day. However, evaluating the monthly lows for the past year, the beginning and end of the month are more likely for lows.
Therefore, we have two primary dates from our histogram.
1/1/21, 1/15/21, and 1/29/21
2:00am, 8:00am, 12:00pm, or 10:00pm
In fact, the high for this year was February the 14th, only thirty days off from our histogram calculations.
The 8.6-Year Armstrong-Princeton Global Economic Confidence model states that 2.15 year intervals occur between corrections, relevant highs and lows. 2.15 years from the all-time peak discrete is February 9, 2020 – a reasonably accurate depiction of the low for this year (which was on 3/12/20). (Taking only the Armstrong model into account, the next high should be Saturday, April 23, 2022). Therefore, the Armstrong model indicates that we have actually bottomed out for the year!
Bear markets cannot exist in perpetuity whereas bull markets can. Bear markets will eventually have price objectives of zero, whereas bull markets can increase to infinity. It can occur for individual market instruments, but not markets as a whole. Since bull markets are defined by low volatility, they also last longer. Once a bull market is indicated, the trader can remain in a long position until a new high is reached, then switch to shorts. The average bear market is eighteen months long, giving us a date of August 19th, 2021 for the end of this bear market – roughly speaking. They cannot be shorter than fifteen months for a central-bank controlled market, which does not apply to Bitcoin. (Otherwise, it would continue until Sunday, September 12, 2021.) However, we should expect Bitcoin to experience its’ exponential growth after the stock market re-enters a bull market.
Terry Laundy’s T-Theory implemented by measuring the time of an indicator from peak to trough, then using that to define a future time window. It is similar to an head-and-shoulders pattern in that it is the process of forming the right side from a synthetic technical indicator. If the indicator is making continued lows, then time is recalculated for defining the right side of the T. The date of the market inflection point may be a price or indicator inflection date, so it is not always exactly useful. It is better to make us aware of possible market inflection points, clustered with other data. It gives us an RSI low of May, 9th 2020.
The Bradley Cycle is coupled with volatility allows start dates for campaigns or put options as insurance in portfolios for stocks. However, it is also useful for predicting market moves instead of terminal dates for discretes. Using dates which correspond to discretes, we can see how those dates correspond with changes in VIX.
Therefore, our timeline looks like:
  • 2/14/20 – yearly high ($10372 USD)
  • 3/12/20 – yearly low thus far ($3858 USD)
  • 5/9/20 – T-Theory true yearly low (BTC between 4863 and 3569)
  • 5/26/20 – hashrate difficulty halvening
  • 11/14/20 – stock market low
  • 1/15/21 – yearly low for BTC, around $8528
  • 8/19/21 – end of stock bear market
  • 11/26/21 – eighteen months from halvening, average peak from halvenings (BTC begins rising from $3000 area to above $23,312)
  • 4/23/22 – all-time high
Taken from my blog: http://aliamin.info/2020/
submitted by aibnsamin1 to Bitcoin [link] [comments]

The basics of crypto-trading: indicators, charts and trend lines

The basics of crypto-trading: indicators, charts and trend lines

The basics of crypto-trading: indicators, charts and trend lines
Halving on the Bitcoin network has become one of the key events in the cryptocurrency market, which has fueled the interest not only of long-standing players, but also has caused the release of new ones. This is evidenced by recent data on the growing demand for crypto assets on top cryptocurrency exchanges such as Bithumb Global. For those who are just getting acquainted with the crypto-market and want to try their hand at trading a new class of assets, we will tell you what tools crypto-exchanges offer and how to use them in crypto-trading.
To start trading cryptocurrencies, you must first select:
• Crypto-wallet — there are several types of crypto-wallets: hot, cold, desktop, mobile and paper. All of them provide different levels of security and convenience. At the same time, the best option for storing cryptocurrencies is the use of two different wallets — hot and cold. So do most large companies working with digital assets.
• Crypto-exchange is a trading platform that will allow you to exchange, buy and sell cryptocurrencies. Such platforms can be centralized (CEX), decentralized (DEX) or hybrid, combining the qualities of CEX and DEX.
• A crypto-portfolio is a collection of crypto-assets collected for profit. It is best to form it in three stages: part of the currency for long-term storage (from 1 year and longer), another part — a medium-term deposit (up to six months) and a deposit for trading for several days or a week. When starting crypto trading, it is advisable to diversify your investment in a deposit for trading, paying attention not only to the potential of a particular coin, but also to the ways of earning that the cryptocurrency market offers. Experts advise at the initial stages to choose assets from the top 10 rating by capitalization.

Terminology

Order — a trader’s request for a cryptocurrency transaction. Orders are divided into market orders — for purchase (Buy) or sale (Sell), and pending — requests for a transaction at a non-market price, waiting for it to be at the right level. Pending orders include:
⁃ Limit — for sale / purchase at a price higher / lower than the current market price
⁃ Stop loss — orders to limit the loss
⁃ Take Profit — Take Profit Order
Market maker and market taker are market participants who create and accept orders. The market maker creates a new transaction request, increases the turnover of the exchange and raises the liquidity of the crypto asset, while the receiving market taker takes the asset out of circulation, lowering its liquidity. In this connection, different commissions are introduced on some crypto exchanges for makers and takers.
Exchange Cup or Order Book — a table with limit orders, which displays the closest sellers and buyers, where sellers’ orders are marked in red, and buyers are marked in green. The columns of the table show the number of cryptocurrencies and the price at which they intend to sell or buy. At the junction of these tables, a spread is formed — the difference in the price of supply and demand. The lower the spread, the more liquid the cryptocurrency. The analysis of the stock market is a leading indicator of the state of the market, since it allows you to predict changes before they happen.
Long and short positions (Long and Short) — the usual “mode” of trading. In the case of a long position, we buy cheaper and sell more. It is believed that the growth of assets in the market is a long process, therefore, work in this direction is also called long. The second option means a short position, that is, a game for a fall. The market believes that the decline in the value of assets occurs quickly, that is, in a short time. Therefore, this position is called “short.”
Exchange chart — shows the change in the price of cryptocurrency over time and is the most important tool for technical analysis. Charts display price changes with a line, bar and candlestick.
Bulls and bears — in the market so-called buyers and sellers. There is an analogy with the nature of animals: buyers always push the price up, creating a demand for something, and it turns out that the price seems to be pushed by horns. In this connection, bulls are optimists, they believe that the prices of the shares they bought will rise, and someday they will sell the asset more expensive than they bought. The bulls in the market are overwhelming (by approximate estimates, up to 80%), long investments are kept on them, and the bull trend means stable growth of stocks and general welfare. Bears, in turn, are sellers who have learned to capitalize on a falling market: they usually try to sell cryptocurrencies faster, often lowering the price of an asset. Concluding a contract for the sale, they fix its value, and then wait until the goods fall in price, close the deal and put the proceeds in their pocket. Bears are interested in a constant reduction in prices and achieve their goal, provoking an increase in supply: open short positions and sell until the price drops to the desired level.
Technical analysis is a set of tools for market forecasting of prices based on the movement of value in the past. In technical analysis, the same tools can be used for different markets and trading pairs with a slight adjustment of indicators. Also, technical tools are equally successfully used on any timeframes — from a minute to a year.
Fundamental analysis — this type of analysis is based on the consideration of financial and production market indicators that may affect the price of a traded instrument. The mood of market players, current and growing trends, indicators of production activity — all this information can give an extensive idea of the potential of the investment object in question. The main disadvantage of the fundamental analysis is that the information provided by him is insufficient to predict the movement of prices in some local areas. It is possible to determine a potentially good company that has excellent financial performance and has real prospects, but it will be impossible to determine the moment of entering a short-term profitable trade with a good indicator of risk to profit ratio.
Pattern — behavioral model / trading setup / market pattern. Patterns are one of the most common methods for analyzing price movements. Each pattern is always based on a certain idea, the simplest and most understandable. There are a lot of trading models, but all of them are derived from the classical model of breakdown or rebound from certain significant price levels.

Basic cryptocurrency trading tools at Bithumb Global

Using the example of a centralized cryptocurrency exchange Bithumb Global, we will analyze the main elements that cryptotraders will encounter in the initial stages of trading. When choosing a cryptocurrency exchange, first of all, you need to pay attention to the presence of:
⁃ Convenient ways to deposit and withdraw funds
⁃ Fiat currency support
⁃ High number of trading pairs
⁃ Information on the current state of cryptocurrency rates
⁃ Cryptocurrency Rate Charts
⁃ Technical indicators
⁃ Different levels of user verification
⁃ Built-in cryptocurrency wallet
⁃ 24/7 tech support
On the Bithumb Global main page, a selection of top trading pairs is offered, where cryptocurrency tickers are listed, their price, exchange rate for the last day, daily trading volume and the asset quotes movement chart.

Top trading pairs at Bithumb Global. Source.
If you select a pair from this list, then Bithumb Global will automatically transfer the user to the Base Version of Spot Trading. Spot trading — the terms of the transaction with cryptocurrency, in which payment is made to both parties immediately.
Here the user can get acquainted with the latest price of an asset, the volume of transactions with it, data on transactions and the minimum and maximum prices for the last day.

Basic Version of Spot Trading on Bithumb Global. Source.
You can select another trading pair in the top menu by hovering over the corresponding button, but the easiest way is to find the desired pair through the search. At the same time, the Professional Version of Spot Trading opens up a wider set of tools for the user, which will be discussed later.

Trading Tools Professional Version Bithumb Global

On the Professional Version, users can use price charts in the form of Candles, which look like a series of vertical lines and display price changes, where the upper point shows the maximum that the price has reached and the lower one — the minimum. If the closing price is lower than the opening, then the candle will be painted red or black, and if higher, then green or white. Knowing the direction of the price movement (body color of the candle), we can say exactly where the closing and opening prices are.

Price chart in the form of Candles at Bithumb Global. Source.
Also in this version of Spot Trading, a price chart is available to users in the form of a Glass, where sellers ‘bids are marked in red and buyers’ bids are marked in green. The analysis of the stock market is a leading indicator of the state of the market, since it allows you to predict changes before they happen. If, for example, a large congestion of sales requests at the upper price limit can be noted, then as soon as the market reaches this limit, a recession will provoke, triggered by a large number of sales.

Price chart in the form of a Glass on Bithumb Global. Source.
Price charts also have different timeframes — from 1 minute to 1 week, which allows you to conduct a more in-depth analysis of the movement of quotes of the selected asset.

Bithumb Global price chart timeframes. Source.
Also in this version of Bithumb Global, various Indicators are available to traders. In total, the cryptocurrency exchange provides about 80 different indicators that will help in the technical analysis of the movement of crypto asset quotes.
Let’s analyze the main indicators available on Bithumb Global:
Volume — allows you to track the number of transactions completed by traders over a specific time interval. Green and red bars are indicators of the volume of transactions: red signals a decrease in volume, green — its growth. By analyzing the volume of transactions against the background of the price movement chart, you can confirm the strength of the trend or reveal its weakness and predict a price reversal. If prices rise and trading volume rises, we observe a bullish trend. An increase in trading volume in the event of a decline in prices indicates a bearish trend.
Moving Average (MA) is just as popular a tool as volume is. The indicator function analyzes the average prices for the selected time interval, which gives a relative idea of the general price trends. If the actual price of cryptocurrency for a long time keeps above the moving average, we can assume that it will continue to grow. Accordingly, a fall below MA is a signal to lower the price of an asset. For more accurate forecasts, it is advisable to use several moving averages based on different time intervals. Moreover, in case of disagreement, it is customary to consider the value of the average based on a longer period of time. If the signals from several moving averages coincide, we can talk about a fairly accurate forecast.
MACD (Moving Average Convergence Divergence) — having trained on one moving average, we will move on to a comprehensive analysis of this indicator. The MACD tool analyzes the convergence and divergence of three moving averages and can signal the beginning of a new trend. MACD also works well on different timeframes and is a fairly simple and popular indicator of technical analysis.
Zig Zag is an auxiliary indicator that analyzes the highest and lowest points of the cryptocurrency exchange rate and allows you to determine the correct entry points into the market. The plus of the indicator is that it eliminates the noise that can distort the forecast of the trend behavior. Minor fluctuations are simply not taken into account: lines connect the highest and lowest points of the price chart directly. The zigzag shows global market movements, but at the same time it only captures these changes in the past, without giving forecasts on the price behavior in the future.
Relative Strength Index (RSI) — shows the greatest efficiency in a sideways trend. With active course dynamics, RSI may produce incorrect data. Such indicators of technical analysis are called oscillators, and they must be used with caution. The indicator’s algorithms analyze price changes and allow you to evaluate the oversold or overbought status of an asset and, therefore, predict the occurrence of a bull or bear trend.
CCI (Commodity Channel Index) — The CCI or Commodity Channel Index, as well as the Relative Strength Index (RSI), helps evaluate overbought or oversold assets. This chart with values from minus 100 to plus 100 is displayed under the current price chart and can be applied on any timeframes. A CCI of more than a hundred means that the asset is overbought, and the price is about to fall, and on the contrary, a CCI below minus one hundred indicates the oversoldness of the asset and the likely increase in its price. This tool also refers to oscillators and is used during a lateral trend when there is no clear idea of how the price will behave in the near future.
ADC and DI — the index of the average direction and direction of movement, signals a change in trend. It looks like three lines on the chart: red — bears, green — bulls, blue (there may be other colors on different platforms) — the strength of the trend. This indicator is fairly reliable on four-hour and day frames. If the trend strength line is within 10−20 points, this indicates that the trend is gaining strength, but if the indicators reach 60−80 points, you should wait for the trend correction. The green and red lines will show who sets the market mood — bulls or bears. If the green line crosses the red line, the trend becomes bullish, and vice versa.

Indicators at Bithumb Global. Source.
Another useful tool available on the Professional Version of Bithumb Global is Trend Lines. It allows you to demonstrate in which direction the price of an asset is moving. The Dow theory, which is the basis of all technical analysis, suggests that no matter how the price behaves, it will always be in a particular trend. If the price behaves relatively evenly and stays in the same range without showing either growth or decline, such a trend is called a side or flat trend.
A growing (“bullish”) trend is characterized by the appearance of a series of ascending highs, with each new peak must be higher than the previous one. Accordingly, the “bearish” downtrend shows points of failure (price low), each subsequent of which will be lower than the previous one.
A trend line can be built on two points of a minimum or maximum, and a third confirming one is mandatory. The more points form a trend line, the more confident and stable the trend itself. The construction points should not be too close to each other in the time frame, otherwise the direction of the trend will not be completely correct. Please note that the uptrend line is plotted below the chart, and the downtrend is above it. The slope on the trend line should also be taken into account — its constancy indicates the stability of the trend. The change in the angle of the trend line is called the acceleration or deceleration of the price movement. The larger the angle, the faster the trend.
A line through price lows is called a support line. As soon as the price reaches it, it finds market support there and, pushing off, again strives upward. The line connecting price highs is called the resistance line.This is the level above which the value of the asset has not yet risen. If the price breaks the support or resistance line, this is a clear signal for a trend violation and a change in trading tactics.

Trendlines at Bithumb Global. Source.

Finally

The above are the basic trading tools available to traders of the Professional Version of the Bithumb Global crypto-exchange. They will help you figure out how to properly analyze the key metrics of cryptocurrency assets so that you can build the most advanced trading strategy. However, this is not the whole range of tools available to Bithumb Global traders. Follow DeCenter materials to learn about the intricacies of cryptocurrency trading on the advanced cryptocurrency exchange.
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What Can We Expect in the Halving Market? 58COIN Exchange Beauty Executive Gives the Answer

What Can We Expect in the Halving Market? 58COIN Exchange Beauty Executive Gives the Answer


What are the effects of the third Bitcoin halving?
How to view the relationship between mining pools and exchanges?
Is the contract a road of no return?
What is the future trend of digital currency?


Q1: What does 58COIN expect from this Bitcoin halving?
Xiao Bei: On the macro level, reduction in the bitcoin production shows a more stable signal to the market. May 12th is the third halving in bitcoin’s history, before it, however, the daily production plunged from 1800 to 900, a reduction of around 30,000 bitcoins in a month. The selling pressure reduced significantly, which leaves the root impact on the gradual stability of the market.
The reduction not only brought us a bull market with a sustainable and long-lasting effect but greater opportunities as well. As an exchange, it should better improve itself and render stable and quality products to users. Currently, 58COIN’s mining pool ranks the top 5 in the world. After the reduction, based on the principle of survival of the fittest, the superior resources will be allocated to a larger and more stable mining farm, and the steady recovery of computing power is also anticipating.
Q2: As an exchange, why does 58COIN occupy more than 10% of the overall bitcoin’s computing power?
Xiao Bei: At present, our computing power share is about 7.8%, ranking among the top five in the world. Our recent goal is to have a stable computing power share of more than 10%.
The mining pool provides the main non-trading BTC source for the exchange, increases the supply of BTCs on the market, and injects liquidity into the market. The top ten exchanges are expected to receive more than 70% of the bitcoin in the mining pool, so all major exchanges have begun to layout the mining pool to compete for BTC.
58COIN has reorganized the layout and started the operation of the new mining pool (58COIN& 1THash) in 2019. We have a mature operation team with more than 6 years’ experience, and hope to better link the upstream and downstream industries in the next stage. This is also an important step in the strategic development of high-quality exchanges.
Q3: For an exchange, liquidity and redemption abilities are the absolute reflection of the user's sense of security. How does 58COIN ensure these two abilities that users care most?
Xiao Bei: In terms of liquidity, first of all, our registered users have exceeded 3 million, which provides sufficient trading liquidity and depth. Secondly, our matching transaction service with constantly upgraded technology and algorithm ensures that each matchmaking time is in the microsecond level, and easily achieve system 10,000-level throughput performance.
Concerning the redemption ability, non-trading digital assets held by the exchange serves as the foundation. The advantages of 58COIN's mining pool have accumulated abundant platform reserves for us. As of now, our risk reserve has exceeded 3.6 billion yuan.
Besides, the Exchange integrates account opening, transaction matching, and liquidation, and plays an important role in the secondary market. Most exchanges lack a high-quality intelligent risk control system, a comprehensive anti-money laundering mechanism, and insufficient open and transparent information disclosure and supervision. There may be acts of forgery of trading volume, joint price manipulation with the project party, and other actions that harm the interests of investors. If the liquidity itself is not good enough, the situation mentioned above is more likely to occur.
Q4: Which section does 58COIN values most? Contract Trading or Spot Transactions? What is the biggest advantage of trading contracts on 58COIN?
Xiao Bei: Both spot and contract boast their own advantages, separately lie in the exchange value through hoarded coins, and flexible use of fluctuations. 58COIN as the main contract exchange, contract trading is definitely our focus. In terms of spot, it is mainly based on mainstream currencies.
Compared with spot trading, the two-direction trading mechanism is more flexible. Also, leverage can increase the utilization rate of funds and amplify the profit, which is suitable for users with fewer funds to trade.
The biggest advantage of contract transactions, in addition to the just mentioned abundant platform reserves, complete risk control and huge user base, there are several points related to the user's vital interests:
  1. The lowest fee in the industry. For example, the handling fee of the perpetual contract is: “Taker 0.03%, Maker 0.015%”;
  2. The fixed maintenance margin of 0.5%;
  3. No funding fees. We have made every effort to reduce the principal consumption in each exchange, thus greatly lower the risk of liquidation;
  4. The platform insurance funds bear the full debt loss, and users do not have to worry about apportioning any risks.
In addition, the contract can also maintain the value of the existing mainstream spot of the user to minimize the risk of depreciation caused by spot fluctuations.
It is worth mentioning that in terms of wallet, we implement multi-level and multi-dimensional security risk control strategies such as hot and cold wallet isolation, multi-signature authorization, and regularly change of hot wallet addresses. Meanwhile, a manual verification process was added to ensure the safety of the assets. Since its establishment, there has never been any wallet accident, wallet stolen, or the loss of coin incidents.
Q5: In the contract transaction, what advice does 58COIN give to novice users?
Xiao Bei: Firstly, please remind that contract is not a devil, it is just a tool. What we should do is to make good use of the tool to make profits.
Secondly, the purpose of the investment is to withdraw, and suggestions are shown below:
1. Invest with the spare funds at hand;
2. In the spot transaction, hoard coins in the bear market and exchange in the bull market, do not follow the trend of buying in the bull market;
3. In the contract, set up operation points and positions, and perform secondary operations according to market conditions. (Do not be greedy)
4. Make a risk response plan during the investment process, such as a sufficient margin, value preservation plan, etc.
Finally, we must keep in mind: when doing spot transactions, choose assets with good liquidity in a way to get away from manipulation projects, risky exchanges, etc.
58COIN provides detailed descriptions for each business line, novice users should read them carefully before using. Besides, each contract trading page is designed with a calculator to help provide trading references to users before investment.
Q6: What are the new plans of 58COIN?
Xiao Bei: First of all, we will remain a sophisticated attitude in technology, risk control, and product experience, offering a stronger guarantee for users' transactions; second, we will further improve the ecological layout of 58COIN, from increasing investment in mining pools, gradually optimizing the hot and cold wallet system, enabling entities, focusing on community construction, etc., with better technical upgrades and preparations, to ensure that the entire 58COIN ecology can better link the upstream and downstream industries, providing our users with a more stable ecological background; We will launch some online activities in the near future, covering basic knowledge, candlestick chart learning, and industry analysis. We look forward to making joint efforts with our users in learning and making progress.
Q7: What does 58COIN want to say about the future cryptocurrency market?
Xiao Bei: The real big bonus in the cryptocurrency market has not yet been released, and Bitcoin has more imagination space than gold in the future. The cryptocurrency market is stepping toward a diversified, professional, and tangible direction, requiring more high-quality industries participation and landing. Though it is currently the fastest-growing field, financial attributes should not be the only factor entitled to cryptocurrencies, the future market should be more integrated and serve the real economy, such as the Internet of Things, financial systems, and personal privacy.
For more details, please log in to www.58ex.com or download our app: https://wap.58ex.com/?locale=en.
Website: https://www.58ex.com/
Twitter: https://twitter.com/58_coin
Facebook: https://www.facebook.com/coin.58COIN
Telegram: https://t.me/official58
Medium: https://medium.com/@58coin_blog/
submitted by 58CoinExchange to u/58CoinExchange [link] [comments]

Has anyone ever thought of a new type of payment system 2

Has anyone ever thought of a new type of payment system 2

https://preview.redd.it/skvs6r0gvzz21.png?width=1958&format=png&auto=webp&s=b106fe9a7cc282cce9d5b2451cfad10601f43855
I have received a lot of feedback after my post "Has anyone ever thought of a new type of payment system?". Thanks to all of those who tried to analyse and set out their vision. Special thanks to those who doubted my competence and brought out their own understanding of the processes and entered into a dispute. And very special thanks to those few who used only accusations in scam and profanity as arguments - they made me understand that it is impossible to explain to everyone, no matter how hard you try. Nevertheless, thanks to the first two categories It became clear to me that the information presented in the article is incomplete and needs to be described in more detail, but of course, only to the first two categories.
Disclaimer
The chain of relationships listed below has been greatly simplified to facilitate understanding. Consciously omitted many things, the description of which would take a huge amount of space.
Introduction.
Majority who oppose technology do not look up to the future and, most importantly, have no idea about the past. Technologies are similar to science, innovation, they can frighten with their ideas and cause rejection in the beginning. After adoption, adherents become ardent followers and hardly recognise something new that goes against already established convictions. Bethink of Christianity - some tried to eradicate it, destroy it, burn Christians on fires, feed them to lions, killed unarmed people in gladiatorial battles. Later, Christianity itself has struggled with dissent - Galileo, Copernicus, Bruno. Examples that are closer to us in time are cars with internal combustion engines, telephone, radio, airplanes ... all these inventions met resistance at the stage of their appearance and caused a storm of ridicule and aversion and misunderstanding of the “use cases”. Not such a distant example with the advent of the Internet, when the web pages were so simple and uninformative that the majority of the population of the Earth simply did not take it seriously and, moreover, did not see its use. There are many such examples. And even the temporary absence of the “use cases” does not indicate the uselessness or irrelevance of the technology, it indicates that the world is not ready yet to apply the technology at the moment due to habits, beliefs, interests, and sometimes, incompetence. The topic of the blockchain and cryptocurrency in particular is susceptible to reproaches in the absence of its practical use, which is understandable due to the youth of the technology and its initial stage of formation and development. In addition, in some cases, the line should be drawn between the cryptocurrency and the blockchain technology itself, since the majority of people do not see the technology itself, but only its derivative in the form of a mass of coins, most of which are dummies and really have no application. But, nevertheless, even at the present stage of development of the blockchain technology, the talk about the lack of “use cases” indicates not owning information, well, or not wanting to see the obvious - merchants, Jaguar, Facebook...
All this applies to today's financial sector conditions. And that is obvious, because the technology of making payment via plastic cards comes from the 1950s. Several generations of people grew up on the existing system and have a long-established habit of using it. Several generations of banks earn huge amounts of money on commissions that customers pay. Several generations of companies providing these payments have changed leadership. Some have gone, and those who remain hold such strong positions and their profits are so huge that they have no reason to rejoice in large numbers for the technology - after all, they can shake their incomes, and the scale of these companies does not allow them to respond quickly to changing time. But even with this in mind, the interest of these companies in technology is obvious. Such pillars like VISA, MC, WU, Barklays, BBVA and many others either look for ways to introduce the blockchain technology or already use it. But, nevertheless, attempts to introduce the technology are still being applied to the existing payment system, credit, and financial relations. Now, I will introduce my own arguments and briefly describe essentially new approach to making payments.
Part One - "What are the existing payment systems and how do they work."
In today's payment system relations, there are six subjects:
  1. Client - buyer of the goods;
  2. Bank-Issuer, where the client keeps his money;
  3. Seller of the goods (Merchant), which accepts the client's card for payment;
  4. Bank Acquirer, where the Merchant keeps his account;
  5. Switch - payment system (PS) that connects the Issuer and Acquirer (for ease of understanding - VISA, Master Card, AMEX, Union Pay, etc);
  6. Processing center - an enterprise certified by the PS, which processes payments of the Bank-Acquire and Bank-Issuer;
  7. There are still various clearing and settlement centers) authorized by payment systems and local securities in different countries to carry out payment operations and perform clearing processes, i.e., reducing settlements between banks' balances, but we will omit them for simplicity of explanation and understanding, since these functions Centers can be performed by Bank-Equal and, in our example, to simplify the description.
Suppose that an American client, whose account is held in a certain American bank, came to Australia to buy coffee. He pays with his plastic card, putting it to the merchant's terminal (POS-terminal). Money from a client is in the account of an American bank, how does the Merchant receive it? POS-terminal Merchant belongs to the bank in which the Merchant holds its account in Bank Acquirer.
  1. The terminal reads the client card and sends information about it to Bank-Acquirer;
  2. Bank-Acquirer is not connected in any way with the Bank-Issuer, therefore, it cannot request directly the payment, and the transfer directly from America to Australia will not allow the client to enjoy hot coffee. Therefore, Bank-Acquirer asks the Processing Center about the availability of the required balance on the client's card;
  3. The processing center requests Switch for the availability of the required balance on the client card;
  4. Switch contacts the Bank-Issuer and requests the availability of the necessary balance on the client's account;
  5. Bank-Issuer confirms to Switch the existence of the required balance (or does not confirm, then the refusal of the transaction occurs);
  6. Switch confirms to the Processing Center the presence of the required balance on the client’s card (account) and gives a signal to the terminal to confirm the payment;
  7. The processing center confirms to the Bank-Acquirer the existence of the necessary balance on the client’s card (account) and gives a signal to the terminal to confirm the payment;
  8. The client has paid and he leaves satisfied;
  9. Bank-Acquirer transfers the sum of purchase to the merchant's account;
  10. The Bank-Acquirer transfers information about the payment made to the Processing Center and issues a claim for compensation of the payment amount;
  11. The processing center transfers information about the payment the Bank-Acquirer made to Switch, since, in fact, the Bank-Acquire has transferred the money to its merchant;
  12. Switch pays from its funds to the Bank-Acquire (for simplicity of explanation, we omit here the clearing system of settlements through authorized clearing centers (in fact, the process is much more complicated);
  13. Switch bills the Bank-Issuer (for simplicity of explanation, we omit here the clearing system of settlements through authorized clearing centers (in fact, the process is much more complicated);
  14. Bank Issuer paid to Switch (for simplicity of explanation, we omit here the clearing system of settlements through authorized clearing centers (in fact, the process is much more complicated)
We can introduce scheme:

Traditional processing scheme
Switch is an intermediary between all the parties of the entire system and receives a commission for all transactions. Who can even imagine the infrastructure setting expenses to operate the processes of settlement analysis, comply with the requirements of KYC / AML, match modern safety requirementsfor the launching of data centers around the world. Of course, commission is the source to operate.
For ease of explanation, we imagine that the Switch is the processing center.
Conceptually, costs can be divided into Organizational and Technical
  1. Organizational:
  • creating jobs for staff of specialists, most of which are expensive: system administrators, engineers, 24 hrs. support services and an authorization center;
  • making decisions of the placement of software and hardware systems. Organization of your own premise(s) or placement of your software and hardware systems in the premises of a third-party company (outsourcer);
  • development of a system for controlling access to the premise(s) of the processing center, including such procedures as: organizing access monitoring, employees to the processing center premises, developing work procedures in high-security areas, etc .;
  • making a decision on the choice of the supplier of software necessary for building a processing center certified by an appropriate payment system;
  • deciding on the choice of suppliers of related services (for example, courier services and / or gateways for sending SMS or PUSH messages, and the subsequent construction of contractual and working relations with it;
  • development, coordination and implementation of procedures for correct work with cryptographic equipment and quantities, and issuance of domestic regulations governing the work of security officers (security officers);
  1. Technical:
  • The purchase of hardware (system units, hard drives, RAM (random access memory, Does RAM), uninterruptible and backup power supplies, racks, etc.),
  • the purchase of the server software (operating systems, database systems, etc.), including license fees vendors of such software,
  • the purchase of cryptographic equipment necessary for the generation and correct processing of operations on cryptographic values, such as CVV or CVC;
  • information security solutions (ensuring compliance with the requirements of PCI DSS, federal laws, protection document management systems);
And such (all of the above) costs must be borne constantly, if we are talking about expanding your presence. Switch (processing centers) can cover these costs only with a part of the commission for the implementation of monetary transactions, which is borne by the other participants in payment relations.
Since the recipient of the client’s money is ultimately the merchant (seller / trader), it is logical that the entire amount of the commission is charged to him. This commission is called Interchange Fee (hereinafter - IF), it can be from 0.7% to 5% depending on the riskiness of operations. For example, an ordinary store, on average, pays 1.5% of IF, while, for example, an online store can pay 5%.
It is noteworthy that for the client this commission is not visible and in 90% of cases he does not even know about it. Such a commission is included in the price of the goods. That is, by selling you a product for $ 100, the Merchant will receive (if he pays IF = 2.24%) $ 97.76. The Switch distributes these $ 2.24 between the participants as follows:
Traditional Processing (TP)
Consumer pays$ 100.00Overall Fee$ 2.24Issuer Receives$ 1.80Acquirer Receives$ 0.31Visa Receive$ 0.13Merchant Receives$ 97.76
o we pulled how the current payment system functions. Now, in detail about how this can function using blockchain technology.
Part 2 - “New payment system and how it works.”
One of the main significant achievements of blockchain technology is excluding of intermediaries. In the field of finance, this gives special advantages — cost savings.
A new type of payment systems based on blockchain can successfully use this advantage. Naturally, there are necessary assumptions for the use of this technology in the financial sphere:
  1. It is necessary that the two contractors and the Merchant are in the same blockchain;
  2. Merchant must have a POS terminal transmitting information to the blockchain;
  3. Banks must open clients wallets and implement data exchange between blockchain and ABS (automated banking system) of the bank,
  4. In order to comply with the requirements of KYC / AML, private keys are kept by the bank;
  5. Must be a blockchain base Switch to physically conduct clearing of payments between the Merchant and the Issuing Bank.
Just as in the situation above with our American customer buying coffee in Australia: the same American and Australian banks, but they are in the same blockchain. It is convenient to send just cryptocurrency, of course, but the question immediately arises - “Why does the Merchant need it and what will it do with it? How will he solve the issue of currency fluctuations? ”Immediately make a reservation that I will not describe the technology here thoroughly, since this is a commercial secret, but briefly, I will describe the principle of operation.
So, two banks are in the same blockchain. In the blockchain, there is a special protocol implemented that allows to “mirror” the client fiat accounts to the blockchain, thus, the exchange of information between the client’s account and the blockchain takes place on an ongoing basis.
  1. The client brings the card to the merchant's terminal; the terminal requests the availability of the required amount in the blockchain. If the required amount is available (if not - decline), the protocol starts the transaction, which the client confirms (fingerprint);
  2. The Fiat amount on the client’s account of the Bank-Issuer is held by the Bank (thus collaterizing the amount of cryptocurrency to be transferred);
  3. The required, “mirror” amount in cryptocurrency is transferred to the Merchant's wallet;
  4. Merchant's wallet, having received the transaction, sends information to the Merchant Terminal, payment is accepted;
  5. The American enjoys coffee. Now, the Merchant has a cryptocurrency on the wallet, Bank-Issuer hold amount in fiat currency;
  6. Switch (the very same payment system), “buys” the cryptocurrency for the Australian dollar from the Merchant in Australia, in America, the Bank-Issuer transfers Switch a collaterized amount of USD.
Again, for ease of explanation, I omit some points that accompany the clearing process.
The scheme of the work of the new payment system can be represented as follows:

Decentralized Processing scheme

What is the advantage?
  1. Switch can set the price for its services significantly lower than existing today, because it saves on the entire infrastructure - hardware, data centers, personnel.
  2. The Bank-Acquirer does not lend, in fact, the Merchant’s account, so its remuneration can be significantly reduced. In addition, in this chain of relations Bank-Acquirer is not needed at all, because the Merchant can hold an account immediately in the Switch;
  3. There is no need to create processing centers, which means that you do not need to bear the costs of creating infrastructure;
  4. The cost of the transaction in the blockchain network is from $ 0.01- $ 0,05;
  5. Transaction time - from 1 to 5 seconds;
In numbers, everything looks like this:
Decentralized Processing (DP)SavingConsumer pays$ 100.00Overall Fee$ 0.650-70.98%Issuer Receives$ 0.35Acquirer Receives$ 0.30Switch$ 0.13Merchant Receives$ 99.22-65.18%
The savings in the process are obvious! The merchant receives 65.18% more money on his account. Bank-Acquirer receives almost as much as in the scheme with traditional processing. The Bank-Issuer receives less remuneration, but under a scheme with decentralized processing, it bears much less expenses on security of payments, payment verification, customer verification, respectively, personnel costs, which always constitute the bulk of costs, decrease.
Conclusion.
In addition to the above economic factors, a new type of payment system has another, perhaps one of the most important advantages compared to traditional PS - to provide an infrastructure for the issuing of plastic cards for issuing banks is much cheaper than traditional PS.
The main problem that the new PS will face is the speed of processing payments. VISA today can handle 150 million transactions per day or 1,700 transactions per second with the possibility of securing up to 24,000 transactions per second. Until a certain time, no public blockchain could solve this problem. Now, compared to the published data on the speed of other blockchains on main net, NeuronChain can confidently claim 2nd place at its speed of 100,000 tps, so this issue is no longer a deterrent.
Of course, to implement the payment relations described above, it is necessary to do a great deal of work, not only on the IT part, but also on technical and legal issues, to spend tremendous efforts on marketing and explaining the processes of the participants in the relationship. But impossible is nothing. In any case, the blockchain technology gives us this opportunity.
submitted by neuronchain to NeuronChain [link] [comments]

Has anyone ever thought of a new type of payment system - 2

Has anyone ever thought of a new type of payment system - 2

https://preview.redd.it/joq0knsisvx21.png?width=1958&format=png&auto=webp&s=fa6c9f6cce01bd413fc961fe54bb9f950e274112
I have received a lot of feedback after my post "Has anyone ever thought of a new type of payment system?". Thanks to all of those who tried to analyse and set out their vision. Special thanks to those who doubted my competence and brought out their own understanding of the processes and entered into a dispute. And very special thanks to those few who used only accusations in scam and profanity as arguments - they made me understand that it is impossible to explain to everyone, no matter how hard you try. Nevertheless, thanks to the first two categories It became clear to me that the information presented in the article is incomplete and needs to be described in more detail, but of course, only to the first two categories.
Disclaimer
The chain of relationships listed below has been greatly simplified to facilitate understanding. Consciously omitted many things, the description of which would take a huge amount of space.
Introduction.
Majority who oppose technology do not look up to the future and, most importantly, have no idea about the past. Technologies are similar to science, innovation, they can frighten with their ideas and cause rejection in the beginning. After adoption, adherents become ardent followers and hardly recognise something new that goes against already established convictions. Bethink of Christianity - some tried to eradicate it, destroy it, burn Christians on fires, feed them to lions, killed unarmed people in gladiatorial battles. Later, Christianity itself has struggled with dissent - Galileo, Copernicus, Bruno. Examples that are closer to us in time are cars with internal combustion engines, telephone, radio, airplanes ... all these inventions met resistance at the stage of their appearance and caused a storm of ridicule and aversion and misunderstanding of the “use cases”. Not such a distant example with the advent of the Internet, when the web pages were so simple and uninformative that the majority of the population of the Earth simply did not take it seriously and, moreover, did not see its use. There are many such examples. And even the temporary absence of the “use cases” does not indicate the uselessness or irrelevance of the technology, it indicates that the world is not ready yet to apply the technology at the moment due to habits, beliefs, interests, and sometimes, incompetence. The topic of the blockchain and cryptocurrency in particular is susceptible to reproaches in the absence of its practical use, which is understandable due to the youth of the technology and its initial stage of formation and development. In addition, in some cases, the line should be drawn between the cryptocurrency and the blockchain technology itself, since the majority of people do not see the technology itself, but only its derivative in the form of a mass of coins, most of which are dummies and really have no application. But, nevertheless, even at the present stage of development of the blockchain technology, the talk about the lack of “use cases” indicates not owning information, well, or not wanting to see the obvious - merchants, Jaguar, Facebook...
All this applies to today's financial sector conditions. And that is obvious, because the technology of making payment via plastic cards comes from the 1950s. Several generations of people grew up on the existing system and have a long-established habit of using it. Several generations of banks earn huge amounts of money on commissions that customers pay. Several generations of companies providing these payments have changed leadership. Some have gone, and those who remain hold such strong positions and their profits are so huge that they have no reason to rejoice in large numbers for the technology - after all, they can shake their incomes, and the scale of these companies does not allow them to respond quickly to changing time. But even with this in mind, the interest of these companies in technology is obvious. Such pillars like VISA, MC, WU, Barklays, BBVA and many others either look for ways to introduce the blockchain technology or already use it. But, nevertheless, attempts to introduce the technology are still being applied to the existing payment system, credit, and financial relations. Now, I will introduce my own arguments and briefly describe essentially new approach to making payments.
Part One - "What are the existing payment systems and how do they work."
In today's payment system relations, there are six subjects:
  1. Client - buyer of the goods;
  2. Bank-Issuer, where the client keeps his money;
  3. Seller of the goods (Merchant), which accepts the client's card for payment;
  4. Bank Acquirer, where the Merchant keeps his account;
  5. Switch - payment system (PS) that connects the Issuer and Acquirer (for ease of understanding - VISA, Master Card, AMEX, Union Pay, etc);
  6. Processing center - an enterprise certified by the PS, which processes payments of the Bank-Acquire and Bank-Issuer;
  7. There are still various clearing and settlement centers) authorized by payment systems and local securities in different countries to carry out payment operations and perform clearing processes, i.e., reducing settlements between banks' balances, but we will omit them for simplicity of explanation and understanding, since these functions can be performed by Bank-Acquirer and, in our example, to simplify the description).
Suppose that an American client, whose account is held in a certain American bank, came to Australia to buy coffee. He pays with his plastic card, putting it to the merchant's terminal (POS-terminal). Money from a client is in the account of an American bank, how does the Merchant receive it? POS-terminal Merchant belongs to the bank in which the Merchant holds its account in Bank-Acquirer.
  1. The terminal reads the client card and sends information about it to Bank-Acquirer;
  2. Bank-Acquirer is not connected in any way with the Bank-Issuer, therefore, it cannot request directly the payment, and the transfer directly from America to Australia will not allow the client to enjoy hot coffee. Therefore, Bank-Acquirer asks the Processing Center about the availability of the required balance on the client's card;
  3. The processing center requests Switch for the availability of the required balance on the client card;
  4. Switch contacts the Bank-Issuer and requests the availability of the necessary balance on the client's account;
  5. Bank-Issuer confirms to Switch the existence of the required balance (or does not confirm, then the refusal of the transaction occurs);
  6. Switch confirms to the Processing Center the presence of the required balance on the client’s card (account) and gives a signal to the terminal to confirm the payment;
  7. The processing center confirms to the Bank-Acquirer the existence of the necessary balance on the client’s card (account) and gives a signal to the terminal to confirm the payment;
  8. The client has paid and he leaves satisfied;
  9. Bank-Acquirer transfers the sum of purchase to the merchant's account;
  10. The Bank-Acquirer transfers information about the payment made to the Processing Center and issues a claim for compensation of the payment amount;
  11. The processing center transfers information about the payment the Bank-Acquirer made to Switch, since, in fact, the Bank-Acquire has transferred the money to its merchant;
  12. Switch pays from its funds to the Bank-Acquire (for simplicity of explanation, we omit here the clearing system of settlements through authorized clearing centers (in fact, the process is much more complicated);
  13. Switch bills the Bank-Issuer (for simplicity of explanation, we omit here the clearing system of settlements through authorized clearing centers (in fact, the process is much more complicated);
  14. Bank Issuer paid to Switch (for simplicity of explanation, we omit here the clearing system of settlements through authorized clearing centers (in fact, the process is much more complicated)
We can introduce scheme:

Traditional Processing scheme
Switch is an intermediary between all the parties of the entire system and receives a commission for all transactions. Who can even imagine the infrastructure launching expenses to operate the processes of settlement analysis, comply with the requirements of KYC / AML, match modern safety requirements for the launching of data centers around the world. Of course, commission is the source to do it.
For ease of explanation, we imagine that the Switch is the processing center.
Conceptually, costs can be divided into Organizational and Technical
  1. Organizational:
  • creating jobs for staff of specialists, most of which are expensive: system administrators, engineers, 24 hrs. support services and an authorization center;
  • making decisions of the placement of software and hardware systems. Organization of your own premise(s) or placement of your software and hardware systems in the premises of a third-party company (outsourcer);
  • development of a system for controlling access to the premise(s) of the processing center, including such procedures as: organizing access monitoring, employees to the processing center premises, developing work procedures in high-security areas, etc;
  • making a decision on the choice of the supplier of software necessary for building a processing center certified by an appropriate payment system;
  • deciding on the choice of suppliers of related services (for example, courier services and / or gateways for sending SMS or PUSH messages, and the subsequent construction of contractual and working relations with it;
  • development, coordination and implementation of procedures for correct work with cryptographic equipment and quantities, and issuance of domestic regulations governing the work of security officers (security officers);
  1. Technical:
  • The purchase of hardware (system units, hard drives, RAM (random access memory, Does RAM), uninterruptible and backup power supplies, racks, etc.),
  • the purchase of the server software (operating systems, database systems, etc.), including license fees vendors of such software,
  • the purchase of cryptographic equipment necessary for the generation and correct processing of operations on cryptographic values, such as CVV or CVC;
  • information security solutions (ensuring compliance with the requirements of PCI DSS, federal laws, protection document management systems);
And such (all of the above) costs must be borne constantly, if we are talking about expanding your presence. Switch (processing centers) can cover these costs only with a part of the commission for the implementation of monetary transactions, which is borne by the other participants in payment relations.
Since the recipient of the client’s money is ultimately the merchant (seller / trader), it is logical that the entire amount of the commission is charged to him. This commission is called Interchange Fee (hereinafter - IF), it can be from 0.7% to 5% depending on the riskiness of operations. For example, an ordinary store, on average, pays 1.5% of IF, while, for example, an online store can pay 5%.
It is noteworthy that for the client this commission is not visible and in 90% of cases he does not even know about it. Such a commission is included in the price of the goods. That is, by selling you a product for $ 100, the Merchant will receive (if he pays IF = 2.24%) $ 97.76. The Switch distributes these $ 2.24 between the participants as follows:

Traditional Processing Sum
Consumer pays $ 100.00
Overall Fee $ 2.24
Issuer Receives $ 1.80
Acquirer Receives $ 0.31
Visa Receives $ 0.13
Merchant Receives $ 97.76
So we pulled how the current payment system functions. Now, in detail about how this can function using blockchain technology.
Part 2 - “New payment system and how it works.”
One of the main significant achievements of blockchain technology is excluding of intermediaries. In the field of finance, this gives special advantages — cost savings.
A new type of payment systems based on blockchain can successfully use this advantage. Naturally, there are necessary assumptions for the use of this technology in the financial sphere:
  1. It is necessary that the two contractors and the Merchant are in the same blockchain;
  2. Merchant must have a POS terminal transmitting information to the blockchain;
  3. Banks must open clients wallets and implement data exchange between blockchain and ABS (automated banking system) of the bank,
  4. In order to comply with the requirements of KYC / AML, private keys are kept by the bank;
  5. Must be a blockchain base Switch to physically conduct clearing of payments between the Merchant and the Issuing Bank.
Just as in the situation above with our American customer buying coffee in Australia: the same American and Australian banks, but they are in the same blockchain. It is convenient to send just cryptocurrency, of course, but the question immediately arises - “Why does the Merchant need it and what will it do with it? How will he solve the issue of currency fluctuations? ”Immediately make a reservation that I will not describe the technology here thoroughly, since this is a commercial secret, but briefly, I will describe the principle of operation.
So, two banks are in the same blockchain. In the blockchain, there is a special protocol implemented that allows to “mirror” the client fiat accounts to the blockchain, thus, the exchange of information between the client’s account and the blockchain takes place on an ongoing basis.
  1. The client brings the card to the merchant's terminal; the terminal requests the availability of the required amount in the blockchain. If the required amount is available (if not - decline), the protocol starts the transaction, which the client confirms (fingerprint);
  2. The Fiat amount on the client’s account of the Bank-Issuer is held by the Bank (thus collaterizing the amount of cryptocurrency to be transferred);
  3. The required, “mirror” amount in cryptocurrency is transferred to the Merchant's wallet;
  4. Merchant's wallet, having received the transaction, sends information to the Merchant Terminal, payment is accepted;
  5. The American enjoys coffee. Now, the Merchant has a cryptocurrency on the wallet, Bank-Issuer hold amount in fiat currency;
  6. Switch (the very same payment system), “buys” the cryptocurrency for the Australian dollar from the Merchant in Australia, in America, the Bank-Issuer transfers Switch a collaterized amount of USD.
Again, for ease of explanation, I omit some points that accompany the clearing process.
The scheme of the work of the new payment system can be represented as follows:

Decentralized Processing scheme

What is the advantage?
  1. Switch can set the price for its services significantly lower than existing today, because it saves on the entire infrastructure - hardware, data centers, personnel.
  2. The Bank-Acquirer does not lend, in fact, the Merchant’s account, so its remuneration can be significantly reduced. In addition, in this chain of relations Bank-Acquirer is not needed at all, because the Merchant can hold an account immediately in the Switch;
  3. There is no need to create processing centers, which means that you do not need to bear the costs of creating infrastructure;
  4. The cost of the transaction in the blockchain network is from $ 0.01- $ 0,05;
  5. Transaction time - from 1 to 5 seconds;
In numbers, everything looks like this:

Decentralized Processing (DP) Sum Saving
Consumer pays $ 100.00
Overall Fee $ 0.650 -70.98%
Issuer Receives $ 0.35
Acquirer Receives $ 0.30
Switch $ 0.13
Merchant Receives $ 99.22 -65.18%

The savings in the process are obvious! The merchant receives 65.18% more money on his account. Bank-Acquirer receives almost as much as in the scheme with traditional processing. The Bank-Issuer receives less remuneration, but under a scheme with decentralized processing, it bears much less expenses on security of payments, payment verification, customer verification, respectively, personnel costs, which always constitute the bulk of costs, decrease.
Conclusion.
In addition to the above economic factors, a new type of payment system has another, perhaps one of the most important advantages compared to traditional PS - to provide an infrastructure for the issuing of plastic cards for issuing banks is much cheaper than traditional PS.
The main problem that the new PS will face is the speed of processing payments. VISA today can handle 150 million transactions per day or 1,700 transactions per second with the possibility of securing up to 24,000 transactions per second. Until a certain time, no public blockchain could solve this problem. Now, compared to the published data on the speed of other blockchains on main net, NeuronChain can confidently claim 2nd place at its speed of 100,000 tps, so this issue is no longer a deterrent.
Of course, to implement the payment relations described above, it is necessary to do a great deal of work, not only on the IT part, but also on technical and legal issues, to spend tremendous efforts on marketing and explaining the processes of the participants in the relationship. But impossible is nothing. In any case, the blockchain technology gives us this opportunity.
Join us -
https://t.me/neuronchain
https://twitter.com/neuronchain
https://medium.com/@neuronchain
https://steemit.com/@neuronchain
https: //www.facebook. com / NeuronChain /
https://www.instagram.com/neuronchain/
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Halved Rewards, Safe-Haven Assets, New Joining of Large Agencies | BTC Will Soar in the Fourth Quarter

Halved Rewards, Safe-Haven Assets, New Joining of Large Agencies | BTC Will Soar in the Fourth Quarter


Investors may still flutter with fear about the plunge of BTC in the early morning of Sept. 25. It has fallen more than $1,700 in three hours, a drop of more than 22%, while the decline of other cryptocurrencies was even greater. Sept. 25 is another unforgettable day for investors who have their fortunes be harvested after Sept. 4. Where will BTC’s price go next? How will investors proceed to the next layout?
Market Pullback, A Plunge of 1,700 Points in Three Hours
At about 2 a.m. on September 25, the BTC’s price fell sharply from 9,526 to 7,779 in three hours, a drop of more than 22%, which is a rare plunge in the crypto market this year. Meanwhile, top cryptocurrencies and altcoins have turned into the plunge mode with a short-term decline of 20%-30% and another decline of 700 points in BTC from 21:00 to 24:00 on Sep 26. Investors despaired and the confidence towards the market fell to the record low.

K-line of Bitcoin (Source: 58COIN Exchange)
Every time the market plunges, participants will find the reason. The reason for this decline is the pullback of the market since three rounds of the rally. The long-term liquidity at the high points is to balance the power between longs and shorts and make preparations for the halving of next year through whipsaw.
The Third Halving is Coming, Can BTC’s Price Surges to $100,000?
The Bitcoin mining rewards halve every four years and have halved twice in 2012 and 2016 respectively. It is expected that the next halving will be carried out in May 2020. Undoubtedly, the supply of BTC will reduce after halving. What’s more, if the demand remains the same, the price will fluctuate inevitably. What investors mostly concerned about is the surging opportunity brought by the third halving.
Let’s try to find some clues by reviewing the data of the previous two halvings.
The first halving occurred on November 28, 2012, when the price of bitcoin was about $11. In the six months before the halving, the price ranged from $2 to $6, and the highest price soared to $1,200 one year after the halving, 110 times the price before the halving.
The second halving time happened on July 9, 2016, when the price was about $741. In the six months before the halving, the price ranged from $200 to $350, and the highest price soared to $19,000 one and a half years after the halving, 54 times the price before the halving.
We can conclude that six months before each halving is the best time to buy bitcoin, and 12 to 18 months after halving when the price surges to the highest, during which may be the optimal selling time.

BTC Reward Halving Time and Amount
The third halving is scheduled to take place on May 19, 2020. We can boldly guess the best purchasing and selling time, they are before November 2019 and between May 2021 to November 2021 separately. The estimated earnings are at least 10 to 50 times. If calculated according to the current price of $10,000, after May 2021, the bitcoin price may surge to over $100,000.
Unstable Political and Economic Situation, BTC Becomes the New Safe-Haven Asset
In addition to the change in supply and demand caused by halving, the instability of the global political and economic situation has also led to an increase in the market’s investment in bitcoin, which has accelerated the rise in bitcoin prices.
The economic slowdown in the world’s major economies, the Sino-US trade war, the upcoming Brexit and the hyperinflation in Argentina and Venezuela — making traditional investment risky, and more people turn to safe-haven assets such as gold and bitcoin. Data shows that the price of bitcoin has increased by 262% from the lowest at the beginning of 2019.
Joining of Large Agencies Drives the Rise of Bitcoin Market
In addition to the above reasons, the gradually increased interest on digital currency from the large institutions serves as another factor driving the future rise of Bitcoin.
In February 2019, JP Morgan Chase & Co., the largest financial services organization in the United States, launched JPM Coin, a cryptocurrency used for instant settlement of payment transactions between customers.
In March, Fidelity Digital Assets (FDAS), the digital asset trading and custody arm of the Fidelity Group, which manages the world’s trillions of dollars, was launched.


On June 18, the Testnet of the cryptocurrency Libra, which was created by the global social networking giant Facebook, was launched on GitHub, and the White Paper was also released. Though Libra was opposed by the United States Senate later, it proves how influential the digital currency is.
On September 23, Bakkt, a digital currency trading platform created by the US Intercontinental Exchange (ICE), was officially launched. Although the transaction was bleak at the beginning, Bakkt’s “physical delivery” approach will become a more preferred trading platform for institutions and large capital holders.
It is predictable that with the increasing scope of the digital asset recognition, more traditional financial giants will join the cryptocurrency realm and launch their featured products. Of course, the higher the attention of Bitcoin got from the global financial giants, the higher its price will be.
Bitcoin may not be the “rich creator” as it was several years ago, however, there is no doubt that the Bitcoin price will rise steadily over time with the relaxation of regulation, the rival between institutions, and the construction of the industry infrastructure, making bitcoin more close to digital gold.
If you are a person who believes in Bitcoin, currently, it is the best time to buy. If you do not know how to buy, go trade on 58COIN Exchange (www.58ex.com). If you are a conservative investor and want to get bitcoin steadily, buy the Cloud Mining and earn a certain amount of BTC every day through mining in the pool. To get it faster, you can purchase BTC through spot trading. Since the platform has launched the “zero fees” activity in the spot trading area, you can catch the chance and save the transaction fee.
Of course, time will judge the correctness of the price prediction. Investors should be aware that investing in digital currencies may involve substantial risk, please conduct your research when making a decision.
Website: https://www.58ex.com/
Twitter: https://twitter.com/58_coin
Facebook: https://www.facebook.com/coin.58COIN
Telegram: https://t.me/official58
Medium: https://medium.com/@58coin_blog
submitted by 58CoinExchange to u/58CoinExchange [link] [comments]

DxChain AMA highlight 05/22/2019

DxChain AMA highlight 05/22/2019
https://preview.redd.it/x00nsvb52s531.jpg?width=3300&format=pjpg&auto=webp&s=2b4392f8c15673b47e0cda8dd3f4945d1d63956a
Hi DxChain Community,
As DxChain Testnet 3.0 is about to be launched, we are glad to see more and more technology and blockchain enthusiasts join the DxChain global community!
We hope the AMA session every two weeks can deepen your understanding of DxChain project progress and concept.
Please refer down below the AMA highlight yesterday, we appreciate every question from our community members:

1. What are all the ways available to gain points?

There are 3 ways to earn community points right now:
The first is to join in the Wednesday Q&A Challenge. The bot will randomly select 30 winners from participants who answer the question correctly. It’s a good chance to know more about DxChain!
The second is to raise questions for the Bi-weekly AMA. The most 3 constructive questions raised about DxChain project (regarding DxChain technology and development) in the AMA session will be awarded by 3,000 community points each.
The third is join in the DxChain Community Ambassador Program. If you are selected as our ambassador, you will earn twice rewards for any other events during your tenure.
Welcome to check more details here: https://blog.dxchain.com/dxchain-community-ambassador-program/
More events are around the corner!

2. Is DxChain using PoS or PoW?

The current DxChain Testnet 2.0 uses PoW + PoST for the consensus protocol.
In the next version of DxChain project, the consensus protocol is designed as a plugin of the system. And we are considering DPoS + PoST as the major algorithms in the Mainnet alpha, and run all the other consensus protocols(PoW, PoA, VRF...) in different Testnets to find out the most suitable and efficient solution.

3. The Bitcoin and ETH are up since last week, why DX price is still low?

Actually the Bitcoin’s soar last week caused almost all altcoins suffered for a while, including ETH. As I just said, the price fluctuations in crypto were normal and difficult to predict. Too much focus on price cannot help the project grow.

4. What’s the implication of DxChain Testnet 2.0?

There are several important implications for the combination of DxChain Testnet 2.0 smart contracts and storage contracts:
1) The original storage contract only supports automated contract renew and money distribution. However, by combining it with the smart contract, more features can be implemented. Any developer can add features and create new products accordingly without modifying the source code.
2) Based on our testing, the smart contract feature we developed in Testnet 2.0 is 100% compatible with the Ethereum Virtual Machine, that means for any DApps running on the Ethereum can directly run on the DxChain as well. It saves developers tons of time on solving issues occurred while migrating the application from Ethereum to DxChain.
3) The current Ethereum smart contract cannot be used for storage transactions or applications. Even though the Swarm, a distributed storage platform, is developed based on the Ethereum, it is highly unstable. The smart contract developed by DxChain can be fully combined with the storage contract, adding more flexibility to the original storage contract and making the off-chain storage operations more efficient.
4) Currently, most distributed applications are developed based on Solidity. Learning and using a new language to develop smart contracts will greatly increase development costs. By adding the smart contract feature, developers can easily build DApps without learning any new materials.

5. What’s the circulation right now?

We have just finished the community bounty token yesterday, the DX circulating supply is 36,325,346,450 DX (36.33% of the total supply).
More details about lockup plans can be found here: https://medium.com/dxchainglobal/dxchain-dx-token-distribution-and-circulation-updates-for-february-2019-ec022dfc7d01



About DxChain
DxChain is the world’s first decentralized big data and machine learning network powered by a computing-centric blockchain. DxChain is a public chain, it designs a revolutionary “Chains-on-chain” architecture to make blockchain function as a computing unit — data storage and computing, so that the technical characteristics of blockchain can be truly extended to a broader field, promoting the next generation of technology from the bottom. For more information, please visit www.dxchain.com. Telegram: https://t.me/dxchain Twitter: https://twitter.com/DxChainNetwork
submitted by DxChainNetwork to DxChainNetwork [link] [comments]

[uncensored-r/CryptoCurrency] Why we won't have a long term bear market, and how to systematically pick your future investments...

The following post by arsonbunny is being replicated because some comments within the post(but not the post itself) have been openly removed.
The original post can be found(in censored form) at this link:
np.reddit.com/ CryptoCurrency/comments/7r4vlc
The original post's content was as follows:
With so much uncertainty right now it would be a good time to take some time to go over what happened recently and how to invest moving foward. We've seen a peak bubble at around 850 billion total market cap in the first week of January, consolidated down to $750 billion and have now just experienced a 40% correction.

What's happening now and how bad will it get?

First of all you should realize that there is a January Dip that happens every year, when we see a roughly 20-30% decline around mid January. This year its been much more severe though for several additional factors that have compounded on top.
Different theories exist on why this happens (its actually the mirror opposite of the "January Effect" that happens in the US stock market), but the two major theories are:
1) Asian markets pull into fiat because of Asian New Year spending needs
2) People in the US sell in January to defer their capital gains tax liability an extra year
While this cyclic event has lead to a healthy correction in the last few years, this year we got these new factors making more fear as well:
So in essence we got a storm of scary news along with the usual cyclic downturn. Currently I don't see this as being a systematic crash like Mt.Gox was that would lead to a long term bear market because the fundamental ecosystem is still intact, and I suspect that after about a month we should consolidate around a new low. All the exchanges are still operational and liquid, and there is no breakdown in trust nor uncertainty whether you'll be able to cash out. What range the market trades in will all depend how Bitcoin does, right now we've already broken below 10K but I'm seeing a lot of support at around $8000, which is roughly where the long term MA curve settles. I don't expect us going below that support line anytime soon without any systematic breakdown. The fact we got closer to it is actually quite healthy in the long term because it is a valuation that can be logically justified using the cost factors of the mining network. In addition when I run a regression on the price history before the crazy Nov/December bull run, the first Fibonacci level seems to be just around $8000. So I think we should consistantly move above that support level, possibly with a few weeks of fluctuations between the $9-$13K range.
What should you do if you recently entered the market?
If you did buy in the last few months at or near ATH, the very worst thing you can do now is sell in panic and lose your principal. You shouldn't have more money in crypto than you can afford to lose, so it shouldn't be a problem to wait a few months. You have to realize that 30% corrections in crypto are relatively common, just last fall we had a 40% flash correction over more China fears. Unless there is a systematic breakdown like we had during Mt.Gox, the market always recovers.
The other worst thing you can do is unload into Tether as your safety net. If there is one thing that could actually cause a long term destruction of trust within the cryptocurrency investment ecosystem, its Tether having a run up on their liabilities and not having enough reserve to cover the leverage. It would not only bring down exchanges but lead to years of litigation and endless media headlines that will scare off everybody from putting fiat in. I don't know when the next Mt.Gox meltdown will occur but I can almost guarantee it will involve Tether. So stay away from it.
What should long term investors do?
For long term holders a good strategy to follow each year is to capture profit each December and swallow the capital gains taxation liability, park a reserve of fiat at Gemini (whose US dollar deposits are FDIC-insured) and simply wait till around late January to early February to re-enter the market at a discount and hold all year until next December. You can keep a small amount in core coins in order to trade around various Q1 opportunities you anticipate. Others may choose to simply do nothing and just keep holding throughout January which is also a perfectly fine strategy. The cyclical correction usually stabilizes toward late January and early February, then we see a rise in March and generally are recovered by end of April. Obviously this decision whether to sell in December to profit on the dip and pay tax liability or to just hold will depend on your individual tax situation. Do your own math sometime in November and follow suit.

How to construct your portfolio going forward

Rather than seeing the correction as a disaster see it as a time to start fresh. If you have been FOMO-ing into bad cryptos and losing money now is a time to start a systematic long term approach to investing rather than gambling.
Follow a methodology for evaluating each cryptocurrency
Memes and lambo dreams are fun and all, but I know many of you are investing thousands of dollars into crypto, so its worth it to put some organized thought into it as well. I can't stress enough how important it is to try and logically contruct your investment decisions. If you follow a set methodology, a checklist and template you will be able to do relative comparisons between cryptocurrencies, to force yourself to consider the negatives and alternative scenarios and also sleep comfortably knowing you have a sound basis for your investment decisions (even if they turn out to be wrong).
There is no ideal or "correct" methodology but I can outline mine:
1) Initial information gathering and filtering
Once I identify something that looks like a good potential investment, I first go to the CoinMarketCap page for that symbol and look at the website and blockchain explorer.
  • Critically evaluate the website. This is the first pass of the bullshit detector and you can tell from a lot from just the website whether its a scam. If it uses terms like "Web 4.0" or other nonsensical buzzwords, if its unprofessional and has anonymous teams, stay away. Always look for a roadmap, compare to what was actually delivered so far. Always check the team, try to find them on LinkedIn and what they did in the past.
  • Read the whitepaper or business development plan. You should fully understand how this crypto functions and how its trying to create value. If there is no use case or if the use case does not require or benefit from a blockchain, move on. Look for red flags like massive portions of the float being assigned to the founders of the coin, vague definition of who would use the coin, anonymous teams, promises of large payouts...etc
  • Check the blockchain explorer. How is the token distribution across accounts? Are the big accounts holding or selling? Which account is likely the foundation account, which is the founders account?
  • Read the subreddit and blogs for the cryptocurrency and also evaluate the community. Try to figure out exactly what the potential use cases are and look for sceptical takes. Look at the Github repos, does it look empty or is there plenty of activity?
2) Fill out an Investment Checklist
I have a checklist of questions that I find important and as I'm researching a crypto I save little snippets in Evernote of things that are relevant to answering those questions:
  • What is the problem or transactional inefficiency the coin is trying to solve?
  • What is the Dev Team like? What is their track record? How are they funded, organized?
  • Who is their competition and how big is the market they're targeting? What is the roadmap they created?
  • What current product exists?
  • How does the token/coin actually derive value for the holder? Is there a staking mechanism or is it transactional?
  • What are the w...
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[Table] I am Antony Davies, associate professor of Economics at Duquesne University, columnist, and sometime tech entrepreneur. AMA!

Verified? (This bot cannot verify AMAs just yet)
Date: 2013-05-22
Link to submission (Has self-text)
Link to my post
Questions Answers
What say you about the Austrian School of Economics? As an econometrics guy, you don't seem to have that in common, but you have seemingly come to largely the same conclusions, i.e. free markets, free trade, etc. I am new to Austrian economics. I got all the way through undergraduate and PhD work and had never heard of Hayek, Mises, or Rand. When I finally heard the Austrian perspective, I was amazed -- using philosophical tools, the Austrians reach the same conclusions that I reached using econometric tools. I believe economics should be taught, at the undergraduate level, from an Austrian perspective. The graphs and equations that populate the standard undergraduate texts speak only to small subset of students. The Austrian approach, however, speaks to a broad audience and provides a solid intuitive understanding of economics that is very difficult to get from a picture.
What specific public policy change in the US do you think would most benefit society in the short and long term? What the US needs to do is something like the following (I've run the numbers, so what I'm about to say is approximately correct)...
(1) Cut federal spending by 10%. If you want to avoid cutting something (e.g., Social Security), then cut something else by more, but the total must come out to a 10% cut. (2) Hold spending constant (no adjustments for inflation) for four years. (3) At the end of year 5, we'll have a balanced budget. From that point forward, the growth in government spending must not exceed the growth in real GDP.
Why would getting a balanced budget help us in the short term? The problem is the debt. As it continues to grow, we approach a point at which the interest payments eat so much of our tax revenue that there is little money left to do the things government needs to do.
Balancing the budget would cause the debt to stop growing.
The CBO estimates that in the next decade, interest payments as a percent of GDP will be no higher than it was during the Bush years. Tell me again why getting a balanced budget will help us in the short term? I've done an analysis of historical CBO forecasts. Of the available 170+ times they have forecasted, they overestimate tax revenues 75% of the time, underestimate spending 80% of the time, and underestimate the debt 90% of the time.
Thank you for all the work you do over at Learn Liberty and for doing this AMA. I don't agree. Sometimes, the economy is like a tube of toothpaste. The government can push down on one end and all that happens is that the other end bulges. In this case, there is no question that the bailout saved jobs in Detroit and saved us the immediate pain of car companies and their suppliers and finaciers going bankrupt.
Today, the conventional wisdom seems to be that the financial and automotive industry bailouts bailouts averted an even worse crisis and saved us from an awful depression. However, what the bailout ultimately did was to keep a large chunk of our scarce resources tied up in industries that have demonstrated their inability to use those resources in the best possible way. So, a decade or two or three from now, we're going to be right back to the dealing with the same problem because we didn't address the disease. We addressed the symptom.
What is your position on the bailouts? And what do you believe would have happened if they had not been implemented? Think of it as a law of conservation of economic pain. The government can't make the pain of wasted resources go away -- it can only shift the pain to the future.
I've seen some of your videos concerning the national debt/budget deficits. What's your prediction on the outcome? Will we see any policy changes before it's 'too late'? And what does it look like when it is, in fact, 'too late'? High inflation? Hyperinflation/currency crisis? A major change in the way government works? I'll give you my personal prediction, though I'm not yet comfortable enough in it to write about it in the press.
I predict the following sequence of events: (1) The economy begins to pick up and the Fed, fearing inflation, starts to let interest rates rise; (2) The federal government -- the largest borrower in the U.S. -- can't afford higher interest payments, so it puts pressure on the Fed to hold interest rates low; (3) Some compromise is reached and the result is a mix of some increase in interest rates and some inflation; (4) Let simmer for a while; (5) Government spending reaches a point that there is no option left by monetizing the deficit (i.e., the Fed prints money to fund deficit spending); (6) The dollar ceases to be the global reserve currency; (7) We start to talk about replacing the dollar with a New Dollar.
As a liberal type of guy I often look at talk of hyperinflation and debt crises in general as a lot of hot air. However, I also understand theoretically how extreme debt can cause a number of problematic issues, including high levels of inflation. What are some real world examples of Western/Industrialized economies that succumbed (or almost succumbed) to hyperinflation in the post-WWII era? Think of borrowing and saving as moving consumption and income across time. When I borrow, what I am really doing is consuming now money I will earn in the future. When I save, what I am really doing is consuming later money I earn now.
When a country does this, it is transferring the consumption and income of the taxpayers across time. So, by accumulating $16 trillion in debt, what the US has really done is to take $16 trillion of consumption away from future taxpayers and give it to today's taxpayers. IMHO, that's an extreme example of taxation without representation.
How would you look at the returns on that $16 trillion dollar consumption? Like surely our military spending, infrastructure or any spending now, has a return for the citizens down the road. You are correct, sometimes it is better to borrow and buy things now because the benefit we get from having the things now outweighs the cost of paying for them later. For an individual, college loans are a good example. For a country, military spending is probably a good example. There are probably others.
There is a serious difference, however, between the decision the individual faces and the decision the country faces. The individual compares the benefit of consuming now to the cost of paying later and judges whether to borrow or to save. At a country level, we can't do the same thing because the people who borrow are not the people who are paying back. It would be like your neighbor deciding whether he should borrow to buy a new car, knowing that he would be able to use the force of law to require you to pay back the money he borrowed.
Professor Davies, Thanks for taking time to do this AMA! What do you think current Federal monetary policy & financial law says about citizenship in America today? Duties? Expectations? Allowed Behavior? It seems to me that the duty of an American citizen is to respect other people's property rights (I use the term "property" broadly to include not just people's objects but their lives and well-beings). To that end, anyone who is willing to come here and so live should be considered a citizen.
If you could automatically remove one United states policy what would it be and why? Also if you could make one United states policy what would it be and why? As a homerun, I would remove the Commerce Clause and the Necessary and Proper Clause. As a second best, I'd repeal the 17th Amendment so that Senators would be appointed by the state legislatures. A third idea I've been wondering about recently is how things would be different if the states appointed the Supreme Court Justices -- e.g., election by the fifty state governors.
A freshman econ major here, just so you know. I've noticed in some of your articles you've been critical of Obama's economic policies, notably his stimulus package. However, it seems you fail to address some of the benefits of the stimulus, such as its investment in human capital and the effect it had on aggregate demand and consequently the recession as a whole. Taking these into account, doesn't it lend some merit to Obama's decision? Furthermore, do you believe that the economy would be better off now if Obama had gone with austerity instead? The question is never does a policy have positive effects (which is the way politicians describe policies), but rather, do the positive effects of a policy outweigh the negative effects of that policy. I tell my students that economists don't care about individuals. What I mean by that is, economic policy is not designed for individuals but for the economy as a whole. So, when an economist thinks about policy, he has to think about the effect on the economy as a whole.
If people measured one's preferred form of governance on a scale of 0 to 100 (0= anarchy, 100= dictatorship), what would be your number? My preference is 0, though I could live comfortably with the 1 to 10 range.
On a scale of one to ten, how dumb are you? On a scale of one to ten, how badly do you need me to pay your phone bill this month?
Do you think that financial crisis like the fall of the banks is an intrinsic part of a growth based economy, or was that just a hiccup that we can fix? And if we can fix it, what steps should we take to make sure that doesn't happen again? The financial crisis was very much the result of government intervention. Since the 1970s, Congress has been pressuring banks to extend loans to low-income and risky borrowers. The banks (because they had to bear the cost of failed loans) largely resisted. That all changed when Congress ordered Fannie Mae and Freddie Mac to ramp-up.
The way it is supposed to work is that banks have a profit motive to loan money and a loss motive to avoid loaning money to people who won't pay it back.
Here's how it did work. Banks would lend money to people. FM and FM would immediately buy the mortgages from the banks. End result: The banks had still had a profit motive to loan money to people, but they no longer had the loss motive to avoid loaning money to risky people. By purchasing the loans, FM and FM took the risk away from the banks. Since FM and FM were backed by the US government, that risk got foisted on taxpayers.
The end result was predictable. Notice that the problem wasn't greed. Banks were greedy before. The problem was that the government removed the penalty for greed (loan defaults) so as to encourage banks to make loans that they otherwise would not have made.
What do you think about the role of "Bitcoin" in society? Bitcoin is absolutely the right idea. It is an easily stored and exchanged currency that can't be inflated. It also has the astoundingly beautiful property of being untraceable. If bitcoin (or something like it) takes hold, it will be a huge blow to government controls everywhere.
As far as I know, it isn't strictly untraceable. Also, the exchange rates can still wildly fluctuate, as we have recently seen with the popping of a bitcoin bubble. How do we know that it is the value of the bitcoin that is wildly fluctuating or the value of the dollar? :)
Do you view taxation as a necessary evil? Wow. That's a hard question. Any tax that pays for something that could otherwise be provided by the private sector is probably an evil tax. So, school taxes are evil. Transportation taxes are probably evil.
So, I suppose the question boils down to, "is there anything the government does that could otherwise be provided by the private sector?" I don't know. I think of myself as a "soft anarchist." By that, I mean, while I'm not ready to say that we can survive without government, I haven't yet heard a compelling argument as to why we do need government.
Do you count the national defense as something that could otherwise be provided by the private sector? Private companies already can fulfill many if not most functions of our military. Probably not. However, the "we need government because we need national defense" argument ends up being circular. (1) I need government because I need an army. (2) But, I only need an army to protect me from your army. (3) You are able to have an army because you have a government. Conclusion: The purpose of government is to protect you from government.
What would you say is the book that everyone should read to understand economics? I always recommend The Armchair Economist (Landsburg, Freedom Press) and Eat the Rich (O'Rourke). The former can be read as individual chapters; the latter is a narrative. Both are excellent.
Will the dollar collapse? And if so, when and why? Also, what are your thoughts on the origin of natural rights?? Most explanations I've read from people like Locke tend to explain it through God which seems like a cop out to me. There are good arguments for the origin of natural rights that don't invoke God. Being a theist, I find the ones that do invoke God more satisfying. I find the philosophical discussion fascinating, but I'm not adept enough to be able to reproduce it.
1) Do you think Keynesian multipliers ever exceed 1? I haven't done the calculations myself, but I've seen estimates in studies that range all the way down to less than one. I'm not a fan of the multiplier, but in its defense, it has been abused by politicians. Politicians quote Keynes' prescription for increasing government spending so as to spur economic growth. But they don't quote Keynes' next statement which is, after the economy picks up, return government spending to its original level.
2) What are your thoughts on the Chicago School vs. the Austrian School? I dislike the idea of "schools." It gives the impression of mutually exclusive sets. There's a lot in the "Chicago school" that is good, so too in the "Austrian school." There's also error in both. My tendency is to approach economics from the Austrian school because the Austrians begin with a first principle (people own themselves), and then construct subsequent principles by applying logic to the first principle. I like that approach.
3) There is quite a bit of derision in the /Economics sub about the Austrian school as being outdated and not quantifiable. What would you say in response to that criticism? I disagree. My training is in econometrics and I find a wealth of quantifiable stuff in Austrian economics.
Do you think cutting entitlement spending could ever be politically viable? There seems to be entire blocks of voters who base their entire vote on 'don't touch my medicare'. The interesting thing here is that whether it becomes politically viable is moot. We are going to reach a point (my guess is not sooner than 5 years nor later than 20) at which it becomes mathematically impossible to continue entitlement spending as it is now. At that point, it won't matter whether there is a political will to cut spending any more than it matters whether there is a political will for gravity to pull downward.
What single math principle would you want all politicians to understand? I believe the problem isn't understanding but communication. I would want no politician to offer something to voters without clearly defining the costs. For example, to ask, "Do you want the government to provide you with health insurance?" is (to many people) a no-brainer. But the question doesn't capture the reality of what's being asked. What's really being asked is, "Do you want the government to provide you with health insurance in exchange for lower quality health care and increased unemployment?"
What got you into economics? My mother. She told me to study it. Always listen to your mothers.
What is the most mind-blowing economic fact/theory that you know? Link to www.antolin-davies.com
Have any post WWII Western/post-industrial economies collapsed as a result of debt or inflation? Not to my knowledge, though Cyprus and Greece might become the first examples.
Hello Dr. Davies, what are your thoughts on the Gold Standard? Any system that holds the supply of money relatively constant is good. It doesn't have to be gold. A water standard or a land standard might work just as well. Many advocates of the gold standard go awry when they claim that we need a gold standard because gold is inherently valuable and we need something with inherent value to back the dollar.
This is incorrect. The reason a gold-backed dollar has value isn't because it is backed by gold. It has value because you can hand it to a bartender and he'll give you a beer.
Would prosecuting the ring leaders of the biggest banks, or breaking the too big to fail banks up have a significant impact on the economy? Or is Holder just lying...again? The ring leaders were Congress and the Federal Reserve. Absolutely, banks were acting like corner drug pushers. But it was Congress and the Fed that were the drug cartel.
Do you think the national debt can be repaid without heavy inflation to reduce its effective size? No. For the moment, it is political impossible. In about five or ten years, it will become mathematically impossible.
Which economic school do you lean towards more? Chicago? Austrian? Austrian -- no question.
Whose your favorite George Mason Economic Professor and why? Rob Raffety. He adjuncts in the law school and was a student of mine as an undergrad.
What do you like best about your job? Variety. It's most of the joy of being self-employed without the risk. Probably only half of the educating I do now is done in the classroom. The rest is via videos, opeds, invited lectures, and venues like this. It's gotten even more interesting in the past couple of years as people seem to be waking up to classical liberal thought.
Regarding public policy, what is your stance on immigration? What is your utopia with respect to immigration, and then what kinds of reforms should Congress seek that are practical with today's government and/or society? Peaceful people should be allowed to cross boarders freely. Immigration is really a violation of your economic freedom. Suppose I own a house and a person from Mexico wants to buy it. Were it not for immigration law, we could come to an agreement and freely transact the exchange. When the government prevents the person from coming into the country, it has the same effect as telling me to whom I can and cannot sell my property.
If you had the chance to scrap our tax system, would you? what system would you go to? Absolutely. I'd replace it with an 18% consumption tax -- no exceptions. I'd also accompany it with a Constitutional amendment requiring a balanced budget. Historically, regardless of tax rates, the government collects total revenue equal to about 18% of GDP. So this tax would generate the same revenue as the government has now. The balanced budget amendment would force politicians to make tradeoffs among spending rather than tradeoffs between spending and tax increases.
What is your response to criticisms of the Austrian School of economics? Also, should children be a part of the free market? Do infants have self-ownership? I would also like to know if you have any responses to this or this. To my knowledge, no philosophical system has yet been able to deal with the "children" question. A philosopher friend of mine once said that parents don't own children, they own the right to parent the children. The way I explain it to my own children is that I make for them the decisions I believe they would make for themselves if they had my knowledge and experience.
Professor I have a question for you. I'm Braziliand and we have a conditional assistance program. We don't give welfare to everyone, in fact the only welfare people get is through work, but we do have free healthcare. Technically, you don't have free healthcare. Rather than paying hospitals for healthcare, you pay the government and the government pays the hospitals.
Anyway we have a program that distributes between 20-80 dollars per family below the poverty line, which is substantial for many of them, and costs a bit more than our outrageous senate. I'm usually skeptical of inequality concerns though not of poverty concerns. No one every died of inequality, but far too many people die of poverty.
Link to en.wikipedia.org. I believe that every person has a moral obligation to care for the poor. But to coerce action is to remove the moral component. If a government forces its people to care for the poor, then you have indeed fed the poor, but the feeding is not a moral act since moral actions require free will.
As it turns out these people spend this money in their local environment, local stores, local markets, in the poorer neighborhoods. So, while I can think of several effective ways the government could use its coercive power to fight poverty, I could not say that any of them are legitmate.
Isn't this a legitimate tool for social mobility and a mini-stimulus package which does wonders for the people? I am quite fond of Hayek's theories but in my country we have such an absurd social inequality that initiatives like these make perfect sense to me. One effective way is a negative tax. That is, everyone pays a fixed percentage of their income and everyone receives a fixed check from the government. For example, suppose we all paid 10% of our incomes in tax and received $10,000 from the government. A person with no job would pay $0 in taxes and receive a $10,000 check. A person who earned $200,000 would pay $20,000 and receive a $10,000 check.
econometrics? I've just started a job in econometric modeling so I would love a good reference! The gold-standard is Econometrics by William Greene, but it is extremely heavy mathematically. You need a solid background in linear algebra to get through it.
What do you think of the transaction tax? specifically Link to thetransactiontax.org. One great danger with a tax like this is that if we don't amend the Constitution to get rid of the income tax at the same time that we enact a transactions tax, we will end up with both.
A potential problem is that a transactions tax (as opposed to a sales tax) might require the government to monitor transactions as opposed to sales. I'm not overly comfortable with that.
So let's say we must cut government spending. IMO we should cut off federal funding for states that vote against spending, since they want smaller government. This would probably start with farm subsidies to mid-western states like OK. The free market will provide America with enough food right? What would you cut first? If you're concerned that we won't have enough food because we aren't subsidizing farmers, fear not. We are already paying a lot for our food, but we pay in two forms. One is payment to the farmers when we buy stuff. The other is payment to the government so it can subsidize farmers. Without the subsidies, farmers would get less money from the government and so might have to charge us more. But we would not be paying the government to pay farmers and so our total cost might not be that different. IOW, removing subsidies is less about how. Much we pay farmers than how we pay farmers.
Glad to catch ya mr. davies! Just quick question: If America were to legalize every drug and regulate said drugs, how do you think this would effect the economy? Putting aside drugs that are instantly addictive (they are a problem because they call into question whether the person has freedom of choice), the government would spend a lot less because we wouldn't have a huge portion of our society locked up. Those people who are locked up for drug offenses would then be free to work -- that would be a huge increase in a valuable resource. All told, I believe that economic growth would accelerate.
What are your thoughts on Distributism? I don't know much about it. I understand that it derives from Catholic social thought. CST is often (IMHO) abused by statists. For example, the directive that we have a responsibility to care for the poor is usually interpretted as a call to government intervention. But the Church doesn't say the government has a responsibilty to care for the poor. It says we have a responsibility to care for the poor.
One way to find common ground between Catholic social thought and classical liberal thought is to think of CST not as recipe for how to fix society but as a description of how a fixed society would look.
As someone who just graduated with a bachelors in Economics/ Int'l Business, what do feel is the current atmosphere for new hires? Any specific sector standing out to you? I have an interview with a company in ATL this coming August. I tell my students that employers don't need you to know how to do things. They'll teach you what you need to do. Employers need you to know how to think clearly and communicate concisely. To that end, emphasize your skills in mathematics, statistics, logic, speaking, and writing, and you'll find employers across a broad range of industries will be interested in you.
Where are the checks and balances on deregulated capitalism? At what point does the free market and the desire to maximize profit influence unethical behavior that may impede on the personal liberties of others (i.e. prison profiteering, military contractors, disaster capitalism)? "Deregulated" is a misnomer. All industries are regulated. The question is whether they are regulated by consumers freely choosing to hand over their dollars for the things the industry produces, or regulated by bureaucrats and politicians.
Is it true that this year’s deficit is greater than the total taxable income of Americans earning more than $100,000? Not greater than their taxable income, but about equal to the amount of taxes they paid. This year's numbers are still in flux. I believe that last year's deficit was around $1.1 trillion. The latest breakdown of federal tax receipts by income group was for 2009. In that year, everyone earning $100,000 and up paid a combined (approximately) $1.2 trillion in federal income, payroll, capital gains, estate, etc. taxes.
I'm confused by your philosophy on too big to fail. You seem to think congress is to blame for our current economic crisis. But I see congress as more of a symptom of institutions being to big to fail. Congress is paralyzed because the institutions have become so powerful that they control congress. If the institutions were smaller they would not have as much clout over congress. Can you comment on this? I believe you have the causality backward. The problem isn't that institutions are so large that they can control Congress. The problem is that Congress has become so powerful that it is worth controlling.
What's your opinion on the Rogoff/Reinhart situation, and did it cause you to change your philosophy? I haven't read the paper. My understanding is that it was a calculation error that changed the results quantitatively but not qualitatively.
Who do you think was the most handsome economist in history? Lord Acton had a rockin beard. Jeffrey Tucker has a rockin tie.
Y...you think that it's a good idea to repeal the 17th amendment? The point (prior to the 17th) was to encourage separation of power between the federal government and the states by making the Senate answerable to the states.
Hello Mr.Davies, As someone who knows nothing about economics and business (I am a welder), what is the best way to break into such fields of work? Education is a must I assume, but are certain universities more valued? Which degrees or majors are more in demand? Are there specific things to learn, do, or specialize in to stand out? How do mentor ships work? How can I meet a mentor and build a relationship with them? Normally, you'd need a bachelors degree in economics at the least. Typically jobs that carry the title "economist" (as opposed to "analyst") require a minimum of a masters degree. If you want to try and break in without getting the formal degrees, you'd need to be extremely good at higher level statistics (e.g., I'd recommend two semesters of stats, one of econometrics, one of advanced econometrics), mathematics (e.g., minimum calculus II), and basic economic theory (e.g., intermediate micro, intermediate macro). Your writing skills would also have to be top notch. Without the degree, you'd also need a goodly piece of luck because it will be hard to convince an employer to take a chance.
Dr. Davies: Given the the United States has previously held a price floor on wages slightly higher than 30% of GDP/hour worked with no significant disemployment effects, (late 1960s) and Canadian minimum wages are currently in the 20-23% range, and yet manages a higher 16-64 employment rate than that of the United States, can you tell me if you believe that an increase in the minimum wage from 12% to 15%, as the President proposed, would have significant disemployment effects, and if so why? I don't know what "no significant disemployment effects" means. The right way to measure the effect of the minimum wage is to compare the unemployment rate at various points in time with the relative minimum wage (i.e., the minimum wage as a ratio of the average hourly wage) at those points in time.
You can see that comparison here: Link to www.antolin-davies.com
Why do you feel comparing the minimum wage to the average hourly wage is correct? Won't that make attempts to suppress wages generally appear as though the minimum wage is higher in real terms than it would otherwise be? It's the correct measure because what is important is the degree to which the minimum wage is distorting the price of labor. For example, if the average free market wage is $10 an hour, I would expect that a minimum wage of $11 an hour won't have much effect. However, if the average free market wage is $5 an hour, I would expect that a minimum wage of $11 an hour would have a huge effect. Conclusion: What matters is the ratio of the minimum wage to the average wage.
Why would you refer to the labour market, a market characterized by weak monopsony and employer-enforced information asymmetry, as a free market? You are correct. I am using the average market wage as a proxy for the free market wage. It's not perfect, but for our purposes isn't a bad proxy.
Is it pronounced "Du-shane" or "Dju-kane"? Du-Kane.
Is Grove City College a good school? I have no first hand knowledge of the college. I know some of their students and faculty and none has ever failed to impress me as good and intelligent.
I think he's saying that there is still an inflection point where debt/GDP ratio causes negative growth. It might not be at 90%, but it will certainly still exist at some point. You are correct.
Last updated: 2013-05-26 17:05 UTC
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Uncomfortable truths about Bitcoin, Tether… and Wirecard? Why is Bitcoin's Price Rising? Why Does Bitcoin Have Value? - D-Central New Bitcoin Regulations from The ECB! CME Bitcoin Futures!

Request PDF | Chaos, randomness and multi-fractality in Bitcoin market | Since its inception, the digital currency market is considerably growing, especially in the most recent years. The main The accuracy achieved for the predicted fluctuation in Bitcoin price and in Bitcoin transaction are 50.538% and 48.387% for 13 days. For Ethereum, the accuracy of price fluctuation and transaction fluctuation are 49.425% and 51.149% for 13 days. In the case of Ripple, the accuracy of Ripple price fluctuation is 63.200 for 13 days. Bitcoin And Cryptocurrency Market Crash Explained (Potential Causes) A familiar scenario for any cryptocurrency investor – a continuous fluctuation of prices accompanied by never-ending anxiety. Anybody who invested even in a small amount of a lesser-known coin would know that one should always be prepared to lose the entire investment. Bitcoin's value has been historically quite volatile. In a three-month span from October of 2017 to January of 2018, for instance, the volatility of the price of bitcoin reached to nearly 8%. Concurrent with a rapid price appreciation, the increase in financial market interest in digital currencies and in Bitcoin in particular, as well as global integration of virtual networks, have prompted the emergence of new academic studies related to economic behavior of this new asset that has been inserted in the world financial market.

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Uncomfortable truths about Bitcoin, Tether… and Wirecard?

Specifically, why does Bitcoin have value, and what causes its value to fluctuate? ... The price of Bitcoin fluctuates much faster than most stocks that are traded on the New York Stock Exchange. This video offers reasoning behind why Bitcoins price is increasing. It references but does not discuss other factors. I realise there is a typo on the bubble reference which should say 2013 ... The real trouble will be the CME Bitcoin futures. Instead of bringing stable growth they will cause erratic price fluctuations all of this pshing Bitcoin further from it's stated purpose. Category If Tether turns out to be a giant shell game, this is going to cause Bitcoin to absolutely implode in terms of price. Here’s the problem: more than half of all the trading that goes on on ...

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