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The Recipe that Causes Bitcoin to Rise: Economic and Geopolitical Uncertainty

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As the world anxiously watched the turbulent events in the Middle East this week, investors have turned to the known safe havens for times of crisis. Throughout history, gold has been a proven investment vehicle during similar tumultuous times, from wars to crises to economic depressions. Yet, over the last week, we saw a notable development that should be carefully analyzed. The increasing heat within the Middle East fueled an event that many anticipated, which allowed the digital heir of gold to demonstrate its intensity and power for (almost) the first time. Who is this heir? Bitcoin, of course.

The assassination of Iranian general Qasem Soleimani and the Iranian missile attacks on US forces in Iraq gave rise to aggressive statements by both the US President and Iran’s leaders and raised genuine concerns regarding potential escalation crossing into other parts of the world. “Third World War” headlines were even spotted in certain media outlets. The response of investors was short and sharp: the global stock markets fell, and everyone rushed for financial cover, many to buy Bitcoin.

Historically Speaking

Throughout history, the acknowledged destination for investment in such situations has been Gold: a scarce asset that retains its value and is detached from the possibly harmful influence of governments and the ordinary markets. And indeed, this week Gold hit a seven-year high (together with a hike in oil price, also directly related to the events in the Middle East).

The Rise of Bitcoin

A far less predictable result was the sharp leap of Bitcoin by more than 20% over only a few days; from less than $7,000 US up to $8,350 US. With every new devastating headline, Bitcoin soared yet further. The very fact that along with gold it has since slightly declined, as the news from the US-Iran front became more relaxed, only reinforces the fact that Bitcoin has demonstrated its role as a digital safe haven for investors.

Advantages of Bitcoin over Gold

Bitcoin has significant advantages over gold, thanks to its digital and decentralized nature, which promises a smarter and more up-to-date alternative for investors. It enjoys the uniqueness of gold as an investment tool with the characteristics of a perfect store of value, thanks to its scarcity, with a maximum supply of 21 million coins. On top of this, and significantly unlike gold, Bitcoin and other cryptocurrencies can be transferred across the world, within minutes or hours, without censorship or intervention of any kind by a third party.

In Times of Stress, Bitcoin is the Obvious Go-to

Recent years have shown growing evidence that Bitcoin is a useful and active investment vehicle in distress situations around the world. Investors are looking for ways to keep their money separate from the unknown impact of governments and the negative situation in the ordinary capital and consumer markets. For example, Bitcoin is increasingly used in countries in severe economic crises, such as Venezuela.

The Increased Strength of Bitcoin

The trade war between the US and China is still casting a shadow over the global markets. The growing pile of debt of trillions of dollars and the weakening of the traditional money is raising fears of a coming financial and monetary crisis. And if that isn’t enough, the fragile economic growth even in the strongest countries isn’t promising a bright future. Under such conditions, it could be expected that the search of investors for alternative assets, such as Bitcoin and other cryptocurrencies – will be even stronger in the coming future.

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Image by Pete Linforth from Pixabay

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Cryptocurrency Prices Rally Towards Double-Digit Gains in 2020

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The cryptocurrency market has started 2020 with a huge bang, expanding by an impressive 23% within the first two weeks of the year. The overall market capitalization of the cryptocurrency market – a measure of the size of the market – has grown from $192 billion at the start of the year, to well over $240 billion by the middle of January.

Leading the pack is Bitcoin (BTC), which constitutes more than 65% of the overall market size. Going from just under $7,200 at the end of 2019 to a high of $8,800, Bitcoin recorded double-digit gains within two weeks. January 14 saw a spike of more than 11% in Bitcoin’s price, fuelling speculation that the two-year-long cryptocurrency recession could finally be over.

Bitcoin Price Chart

Among the many factors that contributed to Bitcoin’s price increase was the geopolitical upheaval emanating from increasing tensions between the USA and Iran, which led to a flight of safety capital by investors, to safe-haven assets such as gold. Already established as a manifestation of digital gold, it seems hardly coincidental that the prices of both gold and Bitcoin went up.

Another catalyst for the increase was the official…

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EOS now available on eToroX exchange

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eToroX announces new cryptoasset and blockchain protocol, and multiple fiat pairs

3 December 2019: eToroX, the blockchain subsidiary of global investment platform eToro, today announced that the EOS cryptoasset is now available on the eToroX exchange. 

From today, EOS will be both a base and counter currency for trading pairs on eToroX, and can be traded against other cryptoassets, including multiple fiat stablecoins. The pairs comprise Bitcoin (BTC-EOS), Ethereum (ETH-EOS), Stellar (EOS-XLM), USD (EOS-USDEX), GBP (EOS-GBPX), and Japanese Yen (EOS-JPYX). 

With the launch of EOS on the eToroX Exchange, eToroX is now one of the few crypto and blockchain exchanges to have all five top cryptoassets — Bitcoin, Ethereum, Stellar, XRP and of course EOS — paired against multiple fiat stablecoins (including CADX, CHFX, and many more). 

Doron Rosenblum, eToroX Managing Director, spoke about eToroX’s vision of opening up access to the tokenized world. “We believe that we can leverage blockchain technology to open up financial markets. The flexibility, scalability, and secure processing capabilities of the EOSIO protocol significantly help the push towards mass adoption, which is an integral part of our ethos.” 

He continued, “We are extremely excited to add an EOSIO-based cryptoasset to our secure and regulated exchange. The launch of yet another blockchain protocol shows how…

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Trusted third parties should issue stablecoins, not Facebook

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eToro believes partnering with authorised partners is the key to success for Libra

If Facebook’s Libra project is to succeed it should use stablecoins issued by regulated third parties rather than create its own cryptoassets; that’s the conclusion of a new position paper published by eToro.

Libra has come under fire from politicians and regulators in the US, UK and Europe, who are worried by parent company Facebook’s scale and power, as well as its previous track record with customer data. However, eToroX Labs, the blockchain research arm of eToro, says that Libra’s aim of creating a peer-to-peer payment network that could be used by millions of unbanked consumers around the world is too great to ignore. 

Rather than create its own digital currency, dubbed ‘ZuckBucks’ by US politicians, eToro believes the issuance of stablecoins backed by fiat currencies should be delegated to regulated third party partners. This would remove Facebook from the responsibility of controlling a currency, so it could focus on Calibra becoming the first wallet to provide infrastructure for a payment system that could be accessed by over 2.7 billion users globally via WhatsApp and other Facebook platforms and benefit a huge unbanked population. 

Yoni Assia, CEO and Co-founder of eToro and co-author of the position paper, explains: “The Libra project is…

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