Top Crypto News – 05/02/2018

New York Lawmaker Proposes Study of State-Backed Cryptocurrency


A New York lawmaker who previously filed several bills related to blockchain has submitted new legislation that calls for studying the creation of a state-backed cryptocurrency.

The measure, dated Feb. 2, calls for the creation of a task force dedicated to studying “the impact of a state-issued cryptocurrency on the state of New York.”

Among the main areas of inquiry would be the regulatory implications of the undertaking, pointing to the U.S. Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission in particular. The task force, if approved, would also study “the implications of issuing such cryptocurrency on monetary policy and financial stability… [and] how local, state, and federal taxation would be affected by such.”

The bill was submitted by lawmaker Clyde Vanel, who in late November submitted four bills related to cryptocurrencies and blockchain. Among those, as reported at the time, was one measure that called for state elections officials to investigate uses of the technology for the purposes of state and local ballots.

Public records indicate that New York’s legislature is also poised to discuss the topic of cryptocurrencies – as well as the state’s BitLicense regulatory framework – at a hearing later this month.

Senators David Carlucci and Jesse Hamilton, according to a notice, are set to hold a public meeting on Feb. 23 with topics including “the logistics and organization of cryptocurrency…its regulation through the BitLicense in the state of New York, other states and on a federal level…and the current marketplace in which it thrives and becomes problematic for consumers.”

It’s not clear at press time who will be appearing before the committee.

Image Credit: Felix Lipov /
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Japan’s Leading Low-Cost Airline Details Plan to Accept Bitcoin


Peach’s Plan to Accept Bitcoin

Peach Aviation has recently clarified its plan to accept bitcoin for airline tickets. This is in response to recent media reports that suggest that the company may be halting its plan to accept the digital currency following the hack of a major Japanese bitcoin exchange, Coincheck – where 58 billion yen (~USD$527 million) worth of NEM were stolen.

Japan's Leading Low Cost Airline Clarifies Plan to Accept Bitcoin

Operating more than 90 daily flights and servicing 12 domestic and 13 international routes, Peach Aviation claims to have more than 13,000 daily passengers.

The company first announced in May of last year that it would accept bitcoin through a partnership with Japanese cryptocurrency exchange, Bitpoint Japan. In addition, Peach plans to expand its bitcoin payment services “through collaborations with local administrative bodies and local companies.” Peach and Bitpoint plan to jointly implement various initiatives such as installing bitcoin ATMs (BTMs) at airports as well as introducing bitcoin payments at souvenir shops, restaurants, and accommodation facilities.

Japan's Leading Low-Cost Airline Clarifies Plan to Accept Bitcoin“Both companies plan to start the service from the autumn of 2017 and will gradually implement various measures in accordance with various laws and regulations,” they announced in May. However, in December, Peach postponed the timeframe to “start [accepting bitcoin] within the fiscal year,” which ends in March 2018, the Sankei reported.

Peach’s Plan Only Delayed

Japan's Leading Low-Cost Airline Clarifies Plan to Accept Bitcoin“We are reviewing the timing of service start,” the spokeswoman for Peach’s public relations told Nikkei Online, confirming that the service has been postponed. The reason for the postponement is “the fluctuation of the bitcoin market [which] has been intensifying since the end of 2017,” she said, noting that the company would “like to start the service [but is] waiting for the market to settle.” Peach also denied any reports of it abandoning the bitcoin payment plan. “I’m actually preparing the settlement system,” the spokeswoman was quoted by the news outlet.

Bitpoint Japan also subsequently issued its own statement clarifying the situation. “We will notify you as to the specific service start time and its contents as soon as it is finalized,” the exchange wrote, adding:

Currently, we are working diligently to realize this service.

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China Censors Cryptocurrency Ads on Search Engines and Social Media



Chinese Online Media Platforms Ban Crypto Ads

China Censors Cryptocurrency Ads on Search Engines and Social MediaA report published by Hong Kong-based media outlet, South China Morning Post, has alleged that leading Chinese search engines and social media platforms have stopped displaying sponsored posts and paid advertisements relating to cryptocurrencies.

The report states that keywords such as ‘bitcoin’, ‘cryptocurrency’, and ‘ICO’ appear to predominantly elicit journalistic content when searched on popular Chinese platforms Baidu and Weibo, whilst yielding an apparent absence of sponsored content. Weibo has confirmed that it does not presently allow advertising relating to cryptocurrencies, whilst Baidu is yet to comment on the matter.

Analysts are speculating that the censorship of crypto ads may have begun following the introduction of the PBOC’s crackdown on ICOs in September 2017.

Facebook Follows China’s Lead

China Censors Cryptocurrency Ads on Search Engines and Social MediaThe report was published just days after Facebook introduced new rules banning “ads that promote […] binary options, initial coin offerings, or cryptocurrency.” The social media network accuses said ads of “promot[ing] financial products and services that are frequently associated with misleading or deceptive promotional practices,” claiming that “there are many companies who are advertising binary options, ICOs and cryptocurrencies that are not currently operating in good faith.”

The crypto community appears to have largely welcomed Facebook’s new policy, with many bitcoin veterans viewing social media as an advertising medium embraced by Ponzi schemes and opportunists seeking to cash in on the speculative boom surrounding virtual currencies will little intention of delivering robust services or platforms.

Images courtesy of Shutterstock
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Equity Markets vs. Cryptocurrency Markets: Weekly Review



Equity markets sell-off

Global equity markets were hammered last week across the board as inflation fears and concern over higher interest rates intensified with bond yield rise. Each of the seven indices tracked below was down for the week (January 29 – February 4).

In the U.S., the S&P 500 Index fell by 3.9% for the week to close at 2,762. That’s the largest one-week decline in two years. Nevertheless, given its strong start to the New Year, the S&P remains up by 3.3% year-to-date. The Index just finished a 5.6% advance in January, its highest start to the year since 1997.

Harder hit was the German market, with the DAX down 4.2% for the week to close at 12,785, its worse week in almost two years. Bearish sentiment was partly driven by higher yields on German bunds, which rose to two-year highs, while Deutsche Bank losses were reported to be higher than anticipated by the market.

Japan’s Nikkei was the strongest performer, down 1.5% to end at 23,632. The Bank of Japan intervened in the market to halt rising bond yields. Japan was followed by Hong Kong’s Hang Seng Index, which dropped by 1.7% to end at 32,602. The Hang Seng remains a top performance year-to-date for a 9.0% gain.

Stok Market

BSE 30 Sensex: Clear bearish signal

Bearish behavior last week points to further downside for the BSE 30 Sensex. It completed an almost perfect ABCD pattern at the 161.8% Fibonacci extension of the first leg up off the February 2016 low (A to B). A bearish engulfing pattern occurred on the weekly chart as last week’s open was above the prior week’s close, and the close was below the prior week’s low. Last week’s high of 36,443.98 exceeded the prior week’s high of 36,268.19 by only a little before selling pressure took over to push the Index down below the prior week’s low, with the week ending near 35,006.41. The Sensex closed down 2.7% for the week at 35,066.75.

The first potential support zone is around the top of a six-week consolidation range around 33,865, followed by a lower previous support and resistance zone from approximately 32,686 to 32,565.


Hang Seng Index: Time for a rest

The Hang Seng Index has had a nice run recently, rising as much as 19% off the early-December low in eight weeks, as of last week’s 33,484.1 high. Last week the index was down for the first time during the eight-week run, falling 1.7% to close at 2,601.8, and pointing to a likely change in the pattern of consecutive up weeks.


In the bigger picture, the Hang Seng is going strong, having broken out above the 2007 high of 31,958.4 three weeks ago. At the same time, it broke out of the top of a multi-month rising trend channel. Each is a sign of strength. Nevertheless, in the near-term, it looks like it’s heading for a rest, even if it doesn’t last long. First, is the change in the pattern of consecutive positive weeks of performance, and then there is the 14-week Relative Strength Index (RSI). This momentum indicator was the most overbought since the prior record top in 2007, reaching a high of 82.75 two weeks ago. Further, just shy of the recent top is the confluence of two harmonic ratios, derived from prior swings.

Cryptocurrencies: Down across the board

Cryptocurrencies had a tough week, as most have since the start of the year. Out of 211 cryptocurrencies, only four were positive for the week, while the eight cryptos tracked below declined from a little over 10% to more than 26%.

Bearish sentiment was driven by a number of factors including:

  • Worries about tighter regulation.
  • India announcement on plans for much tighter restrictions.
  • Major banks such as Citigroup, JPMorgan and Bank of America banned purchase of cryptocurrencies with their credit cards.
  • Facebook ban of cryptocurrency and ICO ads.
  • Premium for Bitcoin in South Korea drops.
  • Japanese authorities perform an onsite inspection at Coincheck subsequent a robbery of almost $500 million of NEM coins.

Nevertheless, a number of coins had classic bullish hammer candles formed on Friday, February 2, with further strength seen by Saturday, February 3, as price moved above the Friday highs. The hammer is a one-day reversal pattern that is most reliable following a sharp and protracted decline, as we’ve seen recently with most of the cryptos.

As mentioned last week in this column, Ethereum was showing relative strength two weeks ago against the other cryptocurrencies in the table. That relative strength carried over into last week as the decline in ETH was almost half of the others. It declined the least, down 11.8%. The next worst performer was Bitcoin, falling 20.3%, followed closely by IOTA with a drop of 23.5% and then Dash, which declined by 23.9%.


Dash: Bullish reversal signal at support zone

Although Dash (DASH/USD) briefly broke below is rising long-term trend line last week it quickly recovered to form a bullish hammer candle pattern. Bullish confirmation was indicated Saturday as the cryptocurrency moved above the high of the hammer. At the $430.0 low it was the most oversold, it’s been in over a year according to the 14-day RSI.


Bitcoin Cash: Reversal candle

Bitcoin Cash (BCH/USD) also had a bullish hammer candle form on Friday and an upside breakout on Saturday. Support was seen around prior support and resistance levels with a low of approximately $940.9. The odds now favor a continuation higher. Still, this doesn’t mean BCH goes straight up. Short-term weakness should be watched for potential entries at lower prices as it further develops its bottom, if the cryptocurrency is to do so. A decisive move above the internal falling trend line increases the chance for higher prices. Nevertheless, we should be cautious, given the recent volatility and because a break above a trend line by itself is not reliable without additional confirmation.


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