Bitcoin Hovers Around 10K After the Recent Correction
The first half of the year saw Bitcoin go on an incredible rally as the cryptocurrency ended up at higher levels at the end of each month and eventually threatened to replicate the bull run from 2017. However, the month of July brought its fair share of turbulence into the market, and it has been the same in August so far as well. The cryptocurrency has been extremely volatile over the past few weeks, but in a new development, it seems to have stabilized recently and has been trading within a narrow range.
Stable Move Now
While in the past, the cryptocurrency often fluctuated wildly in ranges from $9,000 to $13,000, over the past hours it has been trading between $9,900 and $10,200. It is a significant development for Bitcoin traders, who can now trade with a bit more freedom. The latest drop in the price of Bitcoin has apparently been brought about by the optimism in the markets about a resolution in the trade war between the United States and China. United States President Donald Trump did not impose the extra tariffs as promised and, naturally, it has created optimism. Bitcoin was one of the digital assets that investors had put their money in, in the event of a declining trade war situation, and hence, the price of the crypto has now dropped.
>> Coinbase Strengthens Crypto Custodian Empire with XapoBusiness Acquisition
If the uncertainties of the global economy get somewhat eased, then there is bound to be pressure on the price of Bitcoin. Last week, certain experts had stated that Bitcoin was being looked upon as a hedge against global risks by many investors. The drop in the price of Bitcoin had an impact on the wider crypto market as well, since all of Litecoin, Ethereum, and XRP nosedived significantly after the drop. It remains to be seen how the crypto market plays out over the course of the weekend.
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Binance Expected to Resume US Operations in the Next 2 Months
When it comes to trading in cryptocurrencies, it is always far more effective if one can trade on a large exchange. Large exchanges offer a lot of options with regards to the range of cryptocurrencies, liquidity, and other services. Over the course of the crypto boom that started a few years ago, some exchanges have become the leaders of the industry and Binance is certainly one of those. It went on to become one of the biggest crypto exchanges and was also the preferred choice of many traders in the United States.
Key Details
However, back in June, the company announced that it was working on establishing a new division named Financial Crimes Enforcement Network, and hence, it was going to temporarily stop its services in the United States.
Regulations in the United States have always been a major issue for crypto exchanges, and Binance has also struck a partnership with BAM Trading Services so that it is compliant with regulations in the country. Considering the fact that it now has a US-based partner, Binance will be able to have a bigger presence in the market.
>> Bitcoin Hovers Around 10K After the Recent Correction: What Next?
In an interview with Cheddar, the Chief Executive Officer of Binance, Changpeng Zhao, stated that the crypto to fiat services that had been stopped in the United States could be resumed within the next two months. It is a significant development for all crypto enthusiasts in the country who have not been able to trade in the platform all this while.
Additionally, Zhao also stated that since a new partner is now available, Binance will be exploring ways to increase its presence in the American crypto market once it reopens. However, the resumption of services can never be predicted accurately, and hence Zhao refused to divulge the exact date on which the operations will resume. He said, “I don’t want to promise any fixed dates, but there’s a lot of work being done and there’s a lot of things going on in flux, but I would say in a month or two.”
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Bakkt Set for September Launch
Bakkt, the long-awaited crypto services platform from the Intercontinental Exchange, is finally set for launch on September 23.
Despite being officially announced in August 2018, the platform only received a trust charter from New York State Department of Financial Services this week, which clears the way for the company to begin offering its highly-anticipated physically-settled Bitcoin futures contracts. Bakkt expects to serve a digital marketplace that moves $270 billion per year.
What is Bakkt?
The Intercontinental Exchange, the parent company of the New York Stock Exchange, announced Bakkt a year ago with the intention of creating “an open and regulated, global ecosystem for digital assets.” This means that the platform aims to provide a variety of services relating to cryptocurrency, such as trading, warehousing, and physically delivered Bitcoin contracts. Essentially, Bakkt aims to be the first platform to enable the conversion of cryptocurrency to US dollars for transnational use.
Regulatory Hold-Ups
When the platform was first unveiled 12 months ago, ICE eyed a December 2018 launch date as it intended to have the US Commodity Futures Trading Commission (CFTC) approve its proposed contracts. However, Bakkt was subsequently faced with a series of regulatory hold-ups that forced the launch date to be pushed back to 2019. In May of this year, the company announced it had self-certified its futures contracts through the CFTC, instead of having the commission approve the platform.
User acceptance testing began in July this year, which ensured that users of the platform could communicate with its infrastructure, and this allowed Bakkt to begin the work of taking on potential customers.
>> The IRS has Words for Crypto Investors… Again: Tax Warnings
What does Bakkt Mean for Cryptocurrencies?
Bakkt has massive potential for the future of cryptocurrencies, and this was apparent as Bitcoin’s value surged nearly $600 USD on Friday to once again break the $10,000 USD mark. Due to the nature of Bakkt’s services, it is expected to increase the liquidity of Bitcoin and other cryptocurrencies as it will make it much easier for traders to do business in crypto.
Added to this, Bakkt is tied to the traditional financial industry as a result of its close links with the NYSE. Crypto speculators will be hoping that this link generates a confident sentiment among investors.
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The IRS has Words for Crypto Investors… Again: Tax Warnings
The cryptocurrency industry may still be going strong, but that doesn’t mean it hasn’t had its share of problems. Nor does it mean everyone is a fan of virtual currencies. The IRS certainly isn’t, and crypto investors have learned that the hard way the past two months.
Here’s what we know.
IRS has Words for Crypto Investors
At the start of last month, the IRS began mailing more than 10,000 crypto investors informing (well, it was more of a warning) that they may owe taxes on various cryptocurrency transactions.
This week, word has come out that crypto investors are receiving further letters from the IRS; these letters are warning them that their federal taxes do not match the information brought forward by cryptocurrency exchanges. One upside is that the IRS recognizes that it’s the crypto exchanges that may have made errors, not the taxpayers.
Still, these letters, which crypto investors have been receiving the past few weeks, is yet another indication that the government is focusing on crypto tax compliance, and that they maintain their belief that cryptocurrencies are a “significant threat” to tax collection, as described by the IRS’s top criminal chief.
Interestingly, you can see the letters on the IRS’s website. They state the following: “We received information from a third party (such as employers or financial institutions) that doesn’t match the information you reported on your tax return.” The letters add: “this discrepancy may cause an increase or decrease in your tax, or may not change it at all.”
>> Binance Expected to Resume US Operations in the Next 2 Months
What This All Means
Most people know cryptocurrencies have their share of problems and illegal activity. They are volatile, but they can also bring great fortune to those who invest correctly. Same goes for penny stocks. But when things like this happen, one has to question the legality of virtual currencies. Now, however, I suppose we will see further action being taken in terms of legality, with the IRS announcing they will soon declare criminal tax evasion cases.
Do you have any thoughts on the IRS sending letters to crypto investors? Let us know your thoughts in the comments below.
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Coinbase Strengthens Crypto Custodian Empire with XapoBusiness Acquisition
Coinbase has risen to become the largest cryptocurrency custodian, with the acquisition of Xapo’s institutional business. Immediate reports indicate that the US crypto exchange paid $55 million for the assets in question. The exchange also reportedly beat investment giant Fidelity that was also in the running for the Xapo business.
The acquisition comes at a time when Coinbase’s custodian business has grown to over $7 billion in assets under custody. Coinbase currently services over 120 clients distributed in over 14 countries. Following the acquisition, a number of Xapo’s clients have already moved their crypto assets to the crypto exchange for storage. As it stands, Coinbase stands to store as much as 514,000 in Bitcoin from Xapo customers.
“From the start, our goal has been to build a trusted foundation for institutional investment in Bitcoin (BTC) and crypto assets in general. We’re thrilled to help enable some of the tremendous demand for this emerging asset class,” the exchange said in a statement.
Xapo-Coinbase Integration
Xapo’s business is a great addition to the Coinbase portfolio, as the firm has risen in the ranks to become a pioneer in crypto assets storage. Xapo has also made a name for itself in the creation of security techniques highly needed in ensuring client privacy.
>> Altcoins Almost Wiped Out as Crypto Market Cap Drops $30 Billion
For Coinbase, the acquisition underscores its focus in achieving growth both organically and inorganically. The company has grown on its mission to try and ensure easy and secure access to cryptocurrencies. With the acquisition of Xapo’s business, the firm strengthens its edge in becoming the gateway for millions of people looking for ways to venture into the cryptocurrency sector.
Providing clients peace of mind about crypto safe storage is Coinbase’s primary goal as it continues to affirm its competitive edge in the burgeoning sector. In addition to providing crypto custodian services, Coinbase is also focused on providing new ways of monetizing and leveraging crypto assets. The company currently allows people to borrow against their crypto portfolios as well as lend to other trusted partners.
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