February 26, 2019

IronFX, How Cryptocurrency Regulation and Market are expanding

Will Cryptocurrency be Main Stream of Economy in the future?

ironfx-cryptocurrency-market-outlook-report ironfx-cryptocurrency-market-outlook-report

The US government was able to recover a small amount of Bitcoins stolen back in August 2016, and Bahrain has become the first Arab country to regulate cryptocurrencies.

This article is originally referred from IronFX News.

Starting off this Monday, the major digital coins opened with a negative gap reversing the uptrend it had formed in the previous week.

The opening negative gap is not necessarily bad news for the crypto world, in fact from a research perspective it creates further interest as it could help instigate further actions towards improving the industry’s regulations and awareness.

Crypto industry acquiring listed companies

Numerous cryptocurrency exchanges have been able to align themselves with mainstream markets by acquiring listed companies, with the target of raising capital.

By acquiring listed companies they can therefore offer shares to the public outmaneuvering regulatory scrutiny of a full initial public offering, but they could also appear as financial services firm.

The pre mentioned development gives us the opportunity to break down the matter in more detail as to understand why this could be happening.

First from the firm’s perspective introducing their company as being part of the financial services sector enables them access to a bigger audience on potential clients as they seemingly have further experience in the industry.

This gives them opportunities to attract investors as they can easily promote their services without barriers and completely legally.

Also, acquisition enhances the firm’s reputation, as their supposed exposure to the traditional market portrays them as experts.

From another stand point, a market participant can view this as a dodgy move to avoid regulation and boost profits by selling their coins under the name of a listed company in order to avoid an IPO and to hide its real identity.

Isn’t this dishonest disclosure? Shouldn’t regulation be looking into the real reasons these companies are allowed to be considered as real financial services firms?

Cryptos being used for Money laundering?

On the other hand, it could be a fight for survival as in particular for exchanges, it has been a rough time in the previous year, were fears of price volatility and possible uses for money laundering alongside cyber theft and weak infrastructure.

All the above, have added up to investors turning away and regulators sending messages of caution.

Regulators have a difficult time making decisions and controlling the financial environment with some cryptocurrency exchanges having no market surveillance in place and were involved with conflicts of interest, but also not regulated.

110K USD worth of Bitcoin recovery

Good news for the Crypto industry came yesterday from the US were the government was able to recover a small amount of Bitcoins stolen back in August 2016.

The bitcoins are worth around 110K USD and returned it to cryptocurrency exchange Bitfinex.

This is a small volume compared to the total amount stolen but it’s worth mentioning as a rare example of law enforcement successfully recovering stolen cryptocurrency.

Specifically, 27.7 bitcoins were returned to Bitfinex yet almost 120,000 bitcoin is the total amount missing, valued at $72 million at the time of the theft.

This is one of the biggest cyber robberies that have ever taken place and the fact that some coins have been recovered boosts some confidence for the future.

Bahrain regulate cryptocurrencies

On latest updates, Bahrain has become the first Arab country to regulate cryptocurrencies while its central bank has set its final rules related to crypto asset activities.

The various regulatory framework include licensing, risk management, anti-money laundering and counter-terrorist financing measures.

To close with, we would like to make a small reference to Warren Buffets latest comments in favor of Blockchain saying the innovative technology is important.

Also confirming that statement is news by Samsung which said to include a blockchain wallet in the new Galaxy S10 smartphone.

The majority of market participants view blockchain as the future for recording ledgers and transactions as it continues to move in various industry every week.

Bitcoin Technical Outlook

With the negative gap the digital coin opened on Monday, it traded exactly on our 0.3019 (S1) support level.

With the correction it made yesterday it moved higher for our 0.3245 (R1) resistance level.

If the digital asset moves higher then it could reach the 0.3425 (R2) and even higher is the 0.3628 (R3).

On the downside, a bearish run can force Ripple to drop to the 0.3019 (S1) support barrier.

Even lower is the 0.2860 (S2) and the 0.2667 (S3).

Original Source: IronFX News

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