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Fed Chairman on Crypto | Crypto Presents Investor Risk

Yesterday, bulls charged the crypto market, which caused Bitcoin to add $9B to its market capitalization in less than thirty minutes. But the Fed chairman on crypto is swinging the opposite way.

Today, we’ve seen a few bears emerge from the forest. Specifically, the head of the Federal Reserve spoke on cryptocurrencies today, providing comments that indicate he is bearish on virtual currencies. 

Fed Chairman on Crypto: A Risky Investment 

On Wednesday, Jerome Powell, the head of the Federal Reserve, which is the US’s central banking system, spoke with members of Congress. During the talks, Powell told Congress that cryptocurrencies present grave risks to investors.

When talking about bull runs, a conversation likely stirred by what happened on Tuesday, Powell said that “unsophisticated investors” will charge the market when the digital asset goes up in price, assuming “this is great; I’ll buy this.” However, according to Powell, “there is no promise of that.” 

Despite the popularity of the crypto industry, which earned mainstream interest in 2017, Jerome Powell believes that cryptocurrencies are not real currencies—and he’s not afraid for members of Congress to know this. 

Because cryptocurrencies lack intrinsic value, Powell explained, they are not real currencies. 

Here’s where Jerome Powell may lose some people: 

While it’s true that there are a lot of naive investors in the sector, primarily due to the industry being a ‘learn as you go’ sort of deal (the CFA is trying to change this by adding crypto on the CFA exam), Powell claims that cryptocurrencies have no intrinsic value, which is true. But, and there is a but, this isn’t as bad as it may seem.

Why? Well, because nothing has intrinsic value, as value is subjective. So yes, cryptocurrencies may not have this value, but neither does, for example, gold.

Thoughts?

If you’re interested in banking, or the financial sector in general, you might feel divided as to what to believe.

Powell claims the industry is full of inexperienced investors who charge the market when the price shoots up, without thinking about the consequences, and that these currencies are not real. 

But is he right? Regarding Powell’s thoughts on value, one could argue that he is. However, it’s difficult to ignore the fact that the industry could be more sophisticated. Even the CEO of Dash Pay said last month that there is a “lack of business maturity” in the sector. 

Bitcoin Price

Speaking of cryptocurrencies and bulls runs, how is Bitcoin (the OG of cryptocurrencies) doing today?

Better than it has been doing for the past month, that’s for sure. At press time, Bitcoin is selling for $7,423.59, which means the coin is up 8.48% in the past twenty-four hours. 

The Takeaway

The Fed chairman gives his take on cryptocurrencies, but does he make valid points? Let us know in the comments below if you agree or disagree with the Fed chairman on crypto.

>> Crypto Bull Run: Wells Fargo and Bank of America Patents Push Market Upwards

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Robinhood Adds Dogecoin | Stock App Now Offers 5 Digital Assets!

Robinhood adds Dogecoin: It was all smiles yesterday when Robinhood, a stock trading app, revealed that it added Dogecoin to its platform. But behind the scenes, some are unsure of this event.

Foes say Dogecoin is a parody cryptocurrency. Moreover, they say that because Robinhood supports less than ten digital currencies, many believed the company to be selective over the coins they carried. On the other hand, fans say despite its bizarre nature, Dogecoin has accumulated mainstream interest and has witnessed price peaks throughout the year.

Robinhood Adds Dogecoin, But There’s More

On the market for the past five years, Robinhood has had its share of successes. There have been game-changing announcements, such as the addition of Bitcoin Cash and Litecoin, something that customers have wanted for a while.

Robinhood customers have also expressed an interest in “buying and selling other cryptocurrencies beyond Bitcoin and Ethereum,” explained the company in a post last week.

Some rumors have even floated around the crypto industry that claim that the stock trading app is planning on making a crypto wallet.

Perhaps, however, the addition of Dogecoin will garner the most attention in the weeks to follow.

What Do You Mean, Robinhood Supports Dogecoin?

Choose first; then trade. It’s that simple. If you’re a stock trader on Robinhood, and you’re looking to move into crypto, you will now see Dogecoin on the list of available digital assets for trading. There will be four others listed as well: Bitcoin, Ethereum, Litecoin, and Bitcoin Cash.

Dogecoin Price and Dogecoin Predictions

You can’t deny that Dogecoin is benefitting from the Robinhood listing. At press time, the altcoin was selling for $0.002951, which means the coin is up 12.37% in the past twenty-four hours. It is currently the 30th largest digital currency by market cap.

Robinhood adds Dogecoin
Source: CoinMarketCap

That said, even though Dogecoin is up more than 10%, there doesn’t appear to be much of a dent in the Dogecoin price, which suggests that perhaps the market isn’t overly excited about Robinhood supporting the parody coin—at least not in the long-term; the more than 10% surge could fade quickly.

Or, the opposite could happen. Dogecoin has received critical acclaim, has witnessed price peaks, especially in January of 2018, is known for its focus on zero-fee trading, and has received investments from American rapper and entrepreneur Jay-Z.

So who knows? Parody or not, lack of increase in price or not, Robinhood decided to list Dogecoin over other coins (like Ripple [XRP]) for a reason.

Only Time Will Tell

Robinhood adds Dogecoin as a digital asset available for trading, but will this benefit both Dogecoin and the stock trading app in the long-run? Let us know what you think in the comments below!

>> Coinbase Gets Approval to List Coins that are Securities

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