|Are Bitcoin And Cryptocurrencies Our Future?|
Regardless of what is happening in America's heartland, it seems interest in this asset class is surging and this is apparent in the mania over initial coin offerings. For years as more and more people have become uncomfortable with holding their wealth in fiat currencies they have bought gold as a safe haven. Cryptocurrencies are seen as an alternative to such things as gold bars and silver coins because of their advantage of being easier to buy and sell. Because of bitcoins surging value interest in cryptocurrencies is growing and some investors are being drawn into this new and risky "asset class" without doing due diligence. This has caused me to wonder how much of this is driven by the fear of being left out of the move rather than faith in these new places to put our wealth.
|Bitcoin Is Trading Around $7,500 As This Is Written|
The SEC statement went on to say “If you are relying on a particular endorsement or recommendation, learn more regarding the relationship between the promoter and the company and consider whether the recommendation is truly independent or a paid promotion.” This represents the agency’s latest effort to sound alarms about the white-hot ICO market. In recent months, SEC Chairman Jay Clayton has repeatedly cautioned this space is probably full of fraud. While the SEC didn’t name any specific celebrities, some of the stars who have pushed ICOs include Paris Hilton, Floyd Mayweather, and DJ Khaled.
Returning to the subject of ICOs, it looks like a new era is coming for ICOs, also known as token sales. China’s central bank has announced a ban on ICO funding and an ICO freeze in China because it has “seriously disrupted the economic and financial order.” This has caused much speculation over whether, and how much, financial regulators will look to regulate the space. The Chinese committee voiced concern that some ICOs are financial scams and pyramid schemes which echoes a recent warning from Singapore’s MAS or central bank. Brick and mortar financial institutions also claim to be concerned that “ICOs are vulnerable to money laundering and terrorist financing risks due to the anonymous nature of the transactions, and the ease with which large sums of monies may be raised in a short period of time.
This turns our attention towards the platforms which help connect companies selling tokens or cryptocurrencies with buyers, this is where Blockchain comes in. Blockchain is a secure transaction ledger database where applications like Bitcoin run. It is shared by all parties participating in an established, distributed network of computers and records and stores every transaction that occurs in the network. It essentially eliminates the need for “trusted” third parties such as payment processors. Blockchain proponents often describe the innovation as a “transfer of trust in a trustless world,” referring to the fact that the entities participating in a transaction may not even know each other yet they exchange value with surety and no third-party validation. This has made Blockchain a game changer. Someday when we look back on this will we be able to see just how big a deal all this really is.