Can a Cannabis Crowdgrowing Movement Challenge the Canadian “green rush”?

Canada was promising to be a leader in legislation, cultivation and patient care and access throughout the industry but bureaucracy, bad manufacturing practices and lack of care have made Canada an unwilling example on how not to implement a successful cannabis strategy.

Recreational cannabis has been legal and available since 2018, yet two years on billions have been wiped off the values of the top Cannabis companies and why is the Canadian cannabis community still sourcing their much loved bud from the black market?

Key factors in answering this lie within quality and cost. A high percentage of people asked both online and within Government available data suggest that the quality of legally available weed is not up to standard in comparison with the blackmarket. Add this to the fact that government cannabis is more expensive, it’s clear to see why the market and the money has stayed where it is respected.

This is not to place blame on those cultivators and sellors who are doing their best among unsupportive legislation, high taxes and harsh rules for distribution and advertising. Although that is no excuse for selling dry, mouldy, bug ridden buds; it is a reason to keep in mind.

The billions that have vanished like smoke in the wind solely comes down to overpromising, mismanagement and bad practices. Too many startups received funding or went public either too soon or with the wrong infrastructure and operations in place. The devastating returns of many products and batches originating from Canada over the past years continues. From failing GMP standards and benchmarks to tens of thousands of products being recalled due to being contaminated from yeast, mold or bacteria.

However, this is not to say that this is what will happen elsewhere. The EU and LATAM have varying strategies at various stages of legalisation in both recreational and medicinal markets. The medicinal sector is by far the most advanced with an agreed framework for standards and an infrastructure for distribution.

While researching I came across several successful ‘Cannabiz’ methods but one that garnered most attention was the ‘Crowdgrowing’ model. Seemingly introduced by the company JuicyFields, it’s a revolutionary way of bringing cultivation and investing in cannabis together, allowing entry points to those normally prohibited from doing so.

Crowdgrowing allows anyone from around the world to enter the medicinal marijuana market with just access to the Internet required. Via JuicyFields platform supporters, or e-growers as they are called, help fund licensed, legitimate, community based, medicinal cannabis cultivators and extractors. They then receive a share of the profits once the projects or the harvests are completed and the cultivators and extractors have sold their produce.

What struck me here was the simplicity of the model. Give money to those already in the system and are scalable, receive back once projects or contracts are completed.

The beauty of this is that although they are community or start up projects they are all licensed and conform to EU GMP and GCAP standards and the infrastructure to support them.

JuicyFields applies strict quality standards for cultivating only medicinal cannabis at the licenced greenhouses around the world and by providing users of the platform the benefit after the plants are harvested and sold.

With headquarters in Europe and partners’ facilities in countries with cannabis-friendly legislation, JuicyFields has expanded vastly over 12 months by partnering with more strategic companies and with agricultural, legal, sales and scientific experts in all spheres.

Partnering agreements rather than simple acquisition has led to JuicyField’s operations to cover more than 150,000 sqm of land with minimal expense to the company. Marijuana harvested totaled in excess of 37 tonnes of medicinal marijuana in the first quarters of 2021 alone, with them stating more growth to come continuously.

According to founder and CEO, Alan Ganse, the growth has only just begun and the company’s “major goal is to be listed in the TOP 5 cannabis producers by 2025 along with such giants as Curaleaf, Trulieve Cannabis, Canopy Growth and Green Thumb Industry. We aim to produce not less than 379 tonnes of cannabis and become the number one brand among psychoactive medical and recreational cannabis products.”

A bold statement to be sure, but with their ever increasing number of users and e-growers and the content produced to keep in touch with their community it would be hard not to be enthusiastic regarding this stated growth. When we compare this model to that of Canada’s recreational model there are striking differences.

As of today, the Canadian market is saturated with low prices and poor quality produced bud, a large part of which is being pushed onto patients.

A flood of licenses issued by the government has opened the doors for entrepreneurs, cultivators and patients and yet, left them without quality standards, regulations and audit control. Even the overly regulated medicinal market is suffering with rejections of products and closures of facilities have been reported all over. In 2018, 129 medical cannabis sales and cultivation licenses were given out by Health Canada versus 540 licenses issued in 2020 and yet the black market prevails.

The black market understands their industry, they have been at the forefront for years and with these years comes experience in many forms from cultivation to market desires and needs.

What the legitimate market failed to account for is the value of experience and knowledge of both the product and the market. Most growers know about the reality and pitfalls of drying, curing and storage, avoiding loss through mold and bugs and the hundreds of other factors affecting a good crop. Most dealers know the clients wants and needs and trends and adhere to them. All of them were very much aware that someone or some product that was equal or better was waiting on the sidelines for the chance to take their slice of the market.

Quite simply the legitimate market has years of experience and knowledge to catch up on, the intimate details of cultivating, distributing and understanding your market do not come overnight with theory and statistics, they come from relationships, partnerships and real world experience.

Assessing what has just been uncovered above it is clear to see that the success here not only lies in having a unique and sturdy business model but the fact that companies like JuicyFields, whether knowingly or not, are building the bridges between the black market and the legitimate one, connecting people, something that’s safe to say that Canada has neglected and is now uncomfortably and anxiously coming down from its high.

For a look at all of today’s economic events, check out our economic calendar.

What Happened to Akon’s City Developments

At the 2018 Cannes Lion Festival, Akon stated that his cryptocurrency, Akoin, would bring freedom back to Africa. In a way, it brings financial security decentralization away from governments. However, residents did not receive his vision with open arms, and a gap remains in absolute crypto adoption in Africa.

The Akon city is projected to hail in the Senegal mainland and not an autonomous island. However, that was a significant concern due to the centralized nature of the Senegalese government. Akoin crypto would have to adhere to state laws.

The Akoin Ecosystem

In the wake of an economic crisis in Senegal, Akon breeds an alternative. The proposed Akon city would help deal with mass protests and poverty. Consequently, the $6 Billion project’s success would initiate a sister project in Uganda.

Akon’s ecosystem is not a utility token but an entrepreneurs hub across Senegal. Further, it works with a decentralized exchange and a wallet that facilitates transactions among users. It enables transactions between major crypto coins without the limitations of traditional finance.

Akoin can be purchased on designated online exchanges using fiat currencies, Bitcoin, ethereum and Stellar. Additionally, a user can buy with credit or debit cards. Akon’s main aim is reducing paperwork and procedures for entrepreneurs and small businesses.

Akoin gives African entrepreneurs a chance to compete in international economies. With Akoin token as a medium of exchange for gig economies, health and financial sectors, and governance, among others, lead to a healthy African economy.

The goal and mission could become a reality using any other crypto coin. However, the music mogul stated that Akon is a means of transaction with more prominent brands internationally. As impressive as that is, it faces challenges with government regulations in Senegal, among other African nations.

Challenges Faced By Akon

French Speaking nations in Africa, among them Senegal, use CFA Franc. Franc currency is regulated and issued by BCEAO central bank based in Dakar. The institution warned of the dangers of adopting cryptocurrency and termed it illegal. Moreover, central banks operating in the region are in agreement on the matter.

On a global scale, they warned investors using cryptocurrency and peer-to-peer platforms of “unsafe investments”. From now on, Akon relies on prepaid mobile network vendors to render services to the unbanked population. However, that heavily relies on cooperation from telecommunication companies.

Governments regulate most telecommunication entities in Africa. Consequently, that proves a problem to Akon adoption and success. If mobile firms choose to go on and support crypto, they risk government sanctions. The only legal tender available for Akon in Senegal is CFA Franc.

Many African countries have expressed Scepticism toward cryptocurrency. Additionally, some nations like Zimbabwe have prohibited banks from processing virtual currency transactions. Also, other nations like South Africa are looking for ways to tax digital currencies.

Cryptocurrency Trend in Africa

Akon foundation works to gain partnerships with crypto companies operating in Africa. Akon’s target revolves around firms, foundations, and countries willing to adopt crypto and integrate it into their economies. As established, most companies are eager to venture into a blockchain-based economy. However, their main concern lies with central regulators.

Nigeria, the leading economic giant in Africa, comes third globally for the crypto trade. Its massive business provides hope for the rest of the continent on aspects of crypto investments. However, in February, its Central bank’s unexpected ban on crypto exchanges sent harmful waves across the continent.

In the future, Akon will partner with Mwale Medical and Technology City in Kenya. The $2 billion hubs have over 2000 merchants and 35,000 residents. The pilot project phase in Kenya proceeds without a glitch or government interference. More crypto enthusiasts believe that in a matter of time, governments will yield to cryptocurrency.

Akon solution in Africa

Violent protest and a poor economy has rendered Senegal and mostly its youths jobless. Akon city offers job opportunities as it ventures into real estate. Following the housing problem in Senegal, the project solves house shortages on a national and international level.

The lighting project in Africa pioneered by Akon serves as grounds of consideration for Akon city. Since its launch in 2014, the project has brought solar power to more than 18 countries across Africa. After securing $4 billion from investors, Akon sets to launch developmental stages.

Akon’s Current Situation

The 1st phase of Akon City expects to be complete by December 2023. Full coverage would include Hospitals, malls, residences, schools, police stations and a solar power plant. The 2nd phase is expected to run from 2024 to 2029. Akon City, located two hour’s drive from Dakar and south of Diagne International Airport.

While certain government officials praise Akon city, it has received Scepticism from natives. Some doubt its legitimacy given its decade of poverty for its 15.4 million residents. The plan for the futuristic city is yet to kick start in Senegal.

However, the Minister for Urban Development in Uganda has agreed to offer government land for ‘Akon City` development. They term it a “satellite city”, a copy of the plan already laid out for Senegal.

Akon plans on building a real-life Wakanda version in Senegal. Due to the amount of infrastructure required, the city would not be complete until 2036. Opposition leaders from Uganda claimed it’s a “public secret” that Akon City would never exist.

Additionally, they urged the government to stop giving “sweetheart deals” to Celebrities and wealthy investors. Akon City is yet to become what many aspired it to be, and all eyes are on Senegal’s establishment of real-life Wakanda.

Tether Settles a $1 Trillion Lawsuit Regarding Manipulation

The U.S District Judge Katherine Polk Failla, who was in charge of the case, ruled in their favour. She dismissed half the claims that the plaintiffs presented against the defendants. The remaining claims, Tether and Bitfinex, described them as “meritless.” Hence, they are not willing to settle with them.

The Market Manipulation Saga

The plaintiffs who presented the case to the court said that the accused were deceptive, market manipulative, and anti-competitive. As a result, they claimed to have lost money. In over five years, Tether issued unbacked USDT tokens. Bitfinex would later purchase cryptocurrencies on the open market to increase the price during market plunges.

According to the complaint, this caused the total market capitalization of cryptocurrencies to skyrocket to $795 billion in late 2017.

The plaintiffs are five crypto traders who claim they purchased cryptocurrencies at inflated prices and suffered financial losses as a result. As a class action, the suit represents anyone in the United States who inflated prices may have harmed.

However, the defendants’ lawyers argued in a supporting memorandum that the case would fall apart. Because of the accusation, Tether printed its USDT stablecoins without any solid backing based on the allegation. There is no direct knowledge and proof of the matter.

They also argued that the plaintiffs had not shown that cryptocurrency prices were indeed artificial at that time.

Based on the memorandum, the court would dismiss claims of market manipulation and RICO conspiracy. The reason is that the plaintiffs can’t prove they suffered a monetary loss at the defendants’ hands.

The court would also dismiss claims of anti-competitive and monopolistic behaviour. The class action failed to demonstrate how defendants attempted to claim a dominant market position by raising prices.

Lawsuit After Another

In 2019, New York state Attorney General Letitia James said they were investigating Bitfinex. Tether also came into the spotlight because of the exchange’s affiliation with it. The case revolved around the alleged $850 million cover-ups for a loss. It was around this time that the Tether lawyer admitted that Tether was only 74% backed.

Tether was able to settle the case with New York state. Tether got barred from doing business in New York under the terms of the settlement agreement. Bitfinex and Tether did not admit wrongdoing, but the court fined them $18.5 million.

The court also asked Tether to provide quarterly reserve reports for the next two years. There have since been more lawsuits, both major and minor, regarding Tether and Bitfinex.

How Deflationary Tokens Empower A Crypto Project’s Value

Blockchain technology has ushered us into a digital era, including in finance. More people are opening their minds to the idea of dealing with digital currencies. This progress is something most of us never expected. However, the crypto sector is continuously booming to unprecedented levels. The global pandemic was a situation that led to crypto getting their moment to shine.

Currently, there are over 11,800 coins in the market and still increasing. The crypto market cap is swinging over $2 trillion and is expected to continue on an uptrend. Therefore, it is crucial to note that the economic models of some coins in the market are the reason behind their growth. These coins are deflationary tokens, a booming economic model in the newer coins.

What are deflationary tokens, and how are they influencing crypto projects to reach newer levels? Stay tuned for a clear explanation and my opinion on how they can boost crypto projects’ value.

Understanding the Concept behind Deflationary Tokens

A few of you may confuse the concept of deflation in traditional finance and cryptocurrencies. While in traditional finance, deflation is a bad thing, it is a positive element for cryptocurrencies. In traditional finance, deflation refers to an asset’s decrease in price due to certain conditions such as over-minting.

A deflationary crypto decreases in its market supply as time goes by. This factor implies that users or the project’s team will participate in activities that reduce the coin’s supply on the blockchain. A common way to achieve this end is burning tokens.

A point worth noting is that cryptocurrencies with a finite supply are deflationary by default. They achieve this status since as long as investors buy and hold the coin, its supply reduces. An excellent example is Bitcoin, the king coin in the crypto market and retaining the highest dominance to date.

According to many crypto enthusiasts, deflationary tokens are here to outsmart DeFi. Some of us may still be skeptical about this factor as DeFi shows promise in building web 3.0 into the future. However, projects such as Ethereum turning to deflationary token mechanism raises the question of what the fuss is about. Before we answer that question, let us have a look at how the deflationary token model works.

How Do Deflationary Tokens Work?

As mentioned earlier, deflation in cryptocurrencies mainly involves burning tokens from circulation. The confusion comes in how exactly a blockchain destroys its tokens. It is not a literal activity as it consists in locking the tokens in a wallet without the private keys, rendering them inaccessible.

Platforms employ two types of burning mechanisms: buyback and burn and transaction burning. Buyback is a self-explanatory mechanism as it involves the platform buying back tokens from holders and locking them in an inaccessible address; a platform may use part of its profits to execute this process.

As for burning on transactions, a platform employs a smart contract that automatically burns part of transaction fees. This mechanism heavily depends on the number of transactions on a platform; the more the transactions, the more tokens the platform burns and vice versa.

Major Projects Turning to Deflationary Mechanisms

Some argue that Bitcoin’s finite supply is the reason behind the coin’s great value. Crypto experts call it both inflationary and deflationary. However, focusing on the deflationary side, the coin undergoes halving every four years, reducing its circulation in the market.

Since its halving in 2020, the coin managed to reach a new all-time high, gaining the interest of both retail and institutional investors. It currently stands as an excellent option as a store of value more than an investment.

Nonetheless, Bitcoin is a glimpse at how deflation may work on an asset with a finite supply and high demand; other projects are shifting into deflation as their tokenomics model. Ethereum and Binance are two notable projects using deflationary mechanisms to their advantage.

Benefits Crypto Projects Can Derive from Deflation

There are several advantages both investors and projects can derive from deflationary tokens. Beyond everything else, deflationary tokens wish to solve the issues with traditional finance. Going against popular outcomes, deflationary tokens have a positive impact on the crypto space. Here are some of the ways projects can benefit from them:

  • Increase A Coin’s Value

In the fundamental law of supply and demand, an increase in supply leads to a decrease in demand. Deflationary cryptocurrencies focus on reducing their supply in the market, increasing their scarcity, and heightening their demand. Why, you may ask? It is common knowledge that rarer things to get are more enticing than those which are readily available. Using the same concept, investors have a stronger attraction to scarce coins than those flooding the market. In the long run, this will lead to an increment in the coin’s value.

  • Generating Profits

During the recent bull run, deflationary tokens have been taking the spotlight. This element directly contributes to investor interests as they amass more profits. Another scenario for the same is if a platform decides to buy back coins from holders. The whole process leading to the coin burning will profit those who choose to short their coins. At the end of the day, the expected results will be a boost in value after burning.

  • Removing Extras from the Market

Unsold tokens in circulation are detrimental to the progress of a cryptocurrency. Deflationary mechanisms help a project to remove them from circulation instead of flooding the market. Furthermore, if there were coins distributed incorrectly, burning would be beneficial to rectify the mistake.

Author’s Thoughts

The number of deflationary tokens entering the crypto market today is staggering. We have heard of Burny and Boom tokens, which are some of the popular deflationary tokens. Nonetheless, deflation seems to be catching the eye of big fish in the industry, as is in the case of the Ethereum EIP-1559 upgrade.

This move is an eye-opener for many who were discrediting deflation as a positive impact on the industry. I think it is time for deflation to take over crypto markets, providing alternative ways to store value. Lastly, it is not a matter of how, but when the coins manage to control the crypto market.

For a look at all of today’s economic events, check out our economic calendar.

Why are Regulators More Focused on Clamping Down Crypto Platforms?

For years now, regulators have conflicted with major crypto projects. However, in recent months, regulators have been increasing their efforts to control crypto. National and international regulators like the SEC, FCA, CTFC and FSCA often conflict with crypto networks.

They seem to be more focused on clamping down on crypto projects. The question is, why are they fighting crypto? Keep reading for more. The guide will provide examples of projects involved in SEC conflicts, and discuss why regulators continue to fight crypto.

Projects Involved In Regulatory Fights

Coinbase

One of the biggest most recent spats was between the SEC and Coinbase. Currently, Coinbase is the most popular crypto exchange. It has tons of trading pairs and markets available for users.

However, Coinbase conflicted with the SEC. The network announced that they would be introducing a Lending service(Lend) to help users earn interest.

Immediately on announcing the product’s launch, the SEC warned that they would sue Coinbase if they launched Lend. They said that the product in question falls under the securities category. However, immediately after the SEC response, the Coinbase CEO went public, terming the SEC sketchy. Later, Coinbase cancelled the launch of the product.

Binance

Another ongoing spat is concerning the Binance exchange. Recently, this network has been on the SEC radar with several accusations. Binance has been facing compliance issues. Its activities were banned in the US, leading to the creation of Binance US.

In August, The SEC noted that it was holding some documents from the Binance network. However, they had not yet filed a complaint. The SEC began investigating the Binance exchange for possible insider trading and market manipulation activities. Investigations will look into whether the Binance network profited from insider information.

However, The Binance network publicly confirmed that they have zero tolerance for any insider trading. They have policies for preventing such occurrences within the network. Even though the SEC is investigating Binance, there is no formal charge.

Other regulators like CTFC also investigated whether Binance allowed US users to exchange Bitcoin derivatives. The US Treasury, FSCA, FCA have also shown interest in Binance’s operations.

Bitmex Exchange

Another trading platform that has been on the wrong side with the regulators is the Bitmex exchange. In October last year, the exchange and its top executives faced charges of failing to implement AML. Several of its top executives were arrested earlier this year. Bitmex faced accusations of allowing users from sanctioned countries like Iran to operate.

Robinhood

Robinhood is not essentially a crypto-only exchange. This network has been working on fiat related trades too. However, the SEC announced plans to ban the Payment For Order Flow. The PFOF is a system that allows the Robinhood network by itself to make an income. The SEC banning would mean that Robinhood loses its primary way of earning income. SEC’s actions could be due to Robinhood’s connection to crypto.

Why are Regulators Fighting Crypto Platforms?

The SEC is fighting against crypto and any platforms slightly connected to the blockchain world. XRP, Binance, Coinbase, Bitmex and Robinhood are among the few cases of regulator’s fight against crypto. So, why are regulators focused on a war against crypto? Let’s consider several reasons.

To Have Control Over Crypto

The most primary reason is to gain control of crypto. Controlling digital assets means they will be capable of creating regulations for the crypto space.

For instance, the SEC expressed interest in crypto networks registering some crypto assets on multiple occasions. In fact, in the spat between Coinbase and SEC, the regulator wanted Coinbase to register the Lend service as a regulated product.

The problem is, even after one decade of crypto’s existence, the SEC does not have a list of crypto tied securities. As such, this network is always in fights with crypto and blockchain networks.

It’s in the interest of Other regulatory bodies to centralize the operations of crypto exchanges to regulate them.

To Get More Taxes From Crypto

Some government agencies are interested in earning more income from crypto networks. Recently, in the US, congress introduced regulations in crypto to gain more taxes. Whereas, experts still thought US government owned more bitcoins than any other holder.

When discussing the $1 trillion infrastructure bill, they included a section that will increase crypto. The new bill touches all projects slightly tied to crypto. The idea is to raise billions for funding the infrastructure bill. Thus, the increased efforts by regulating authorities like treasury are to get more income from crypto.

To Protect Consumers

Another for the increased fights against crypto is consumer protection. Generally, crypto since its launch has been under criticism from security and regulating authorities. Many claims that crypto is a mere bubble, and as such, can easily disappoint users. Therefore, the SEC, CTFC and FCA are trying to protect their users.

To Ban Cryptocurrency

Finally, governments may be using regulatory bodies to fight against crypto and ultimately kill it. Some governments like China have enhanced the fight on crypto, intending to ban it. As such, they are increasing regulations every other day.

Final Word

This guide has looked into the regulatory environment surrounding crypto today. It seems like many regulators today are trying to suppress crypto in every way. The cases of Coinbase, Binance, Bitmex and Robinhood, are good examples of regulatory suppression. But why are they fighting crypto?

There are four possible reasons behind their increased fights. Foremost, most governments and regulators want to have control of crypto. They want to centralize the blockchain world and create regulations to take complete control.

Moreover, the regulators’ interest could be increasing the national revenues. It’s also possible that consumer protection and possible crypto bans are reasons behind the increased regulations. However, Governments should focus more on helping crypto grow instead of suppressing its adoption.

Binance Halts Several Crypto Trading Services in Australia, as Regulatory Issues Continue

In an announcement, Binance revealed its plans to stop offering certain products to Australian traders. Users from the region will have no access to leveraged tokens, options, and futures. The new guideline starts on September 24, 2021. What’s more, Australians have a 90-day period to shut down or minimize their positions.

An End to Derivative Trading in Australia

Binance continues to examine how it can relate well with global regulators. By stopping derivative trading in Australia, Binance believes it can be on the safe side of the law. Thus, Australian traders cannot complete their positions once December 23, 2021, arrives.

Furthermore, the exchange is going to close any open position after the deadline. Binance issued yet another directive to Australians in August 2021. In the report, Binance said it is restricting Australian users from opening an account with the exchange. It blocks traders from creating margin products, options, and leveraged token accounts.

The Compliance Journey

The majority of countries are against the product offerings that Binance extends to users. For instance, the Cayman Islands claims that the exchange is operating in the region illegally. The Island’s regulator says that Binance is providing digital asset services without a license.

Hosting such products in the region requires companies to obtain a waiver from Cayman’s monetary authority. The Netherlands had a similar argument with Binance in August 2021. As per the Dutch Central Bank, the platform is offering crypto services without any official registration.

The bank also says that Binance could expose users to illegal financing and money laundering activities. Other countries in conflict with Binance’s offerings include Holland, Japan, and the U.K.

Taking up Centralization

The latest development shows that Binance may adopt centralization in its operations. Binance’s head, Changpeng Zhao, admits that centralization can improve its compliance status. The statement means that the platform could reveal its headquarters in the future.

However, the downside is that governments might constantly monitor the customers’ financial dealings. Revealing such data breaks the basic rules in the crypto space concerning privacy. In the long run, involving financial regulators also allows Binance to work without any conflicts. Hence, the exchange can secure licensing support from global regulators.

For a look at all of today’s economic events, check out our economic calendar.

How Much Will Bitcoin be Worth in 2025?

However, it lost more than half of its market value compounded by China’s harsh regulations and a crackdown on mining activities. The year has also witnessed an increase in Bitcoin adoption rate with several global financial institutions and established technology firms. Notably, they include PayPal, Visa, JPMorgan, Goldman Sachs, MicroStrategy, Apple, and Tesla, all adopting Bitcoin.

Following increased Bitcoin adaptation coupled with increased blockchain-based investments, it’s evident that hyperbitcoinisation is almost a reality, predicted to occur by 2050. It means the moment Bitcoin takes over global finance.

However, even before hyperbitcoinisation, what will be the price of Bitcoin in 2025? Considering Bitcoin’s price history, behavior, and relevant expert predictions here’s what you could expect Bitcoin to be worth in 2025.

Bitcoin’s Price History

Bitcoin was launched in January 2009 by pseudonymous Satoshi Nakamoto. Satoshi presented the idea of a decentralized digital currency under a whitepaper titled: Bitcoin: A Peer-to-Peer Electronic Cash System. Ten months after the whitepaper presentation, Bitcoin’s market worth debuted at the rate of $1 US Dollar = 1,309.03 BTC. Initially, the price of the crypto world-beater was determined based on the electricity cost needed to mine a single coin.

Bitcoin’s Price Surges

Bitcoin made the first-ever positive price movement in 2010 to trade at $0.08. However, the price movements were slowed down by high volatility and unregulated markets, contributing to excessive fraud. In 2011, bitcoin jumped to $32, only to drop to $2 later.

Later on, Bitcoin gained some popularity among tech enthusiasts and corporate investors, leading to an enormous price growth from $4 in 2012 to $1,200 in 2017. However, despite the massive price growth, the BTC market was still volatile and still vulnerable to security challenges marked by the millions worth of cyberattacks.

In 2017, bitcoin went against all expectations hitting $20,000 price value before tumbling to $7,000 months after. It made a price recovery in 2018 and 2019 thanks to increased public awareness and adoption by institutional investors.

In 2020, the COVID-19 pandemic brought the global economy to its knees. Regardless, Bitcoin saw its rise to a high of $23,400, gaining over 200%. Bitcoin’s enormous price growth in 2020 was attributed to the inclination to Bitcoin by Wall Street institutions. The reason for this was to hedge funds following the tumbling of other financial markets.

Bitcoin’s growing acceptance by both institutional investors and consumer-facing companies was instrumental for its price growth witnessed in 2020.

Bitcoin’s Current Price

Bitcoin kick-started 2021 at $29,048.39 amidst increased demand and interest from institutional investors and companies. The market was still pretty volatile, marked by short and sharp price fluctuations. Tesla’s founder and CEO announced the company had bought $1.5 billion in bitcoin and planned to accept it as a means of payment. As a result, it led to a big bull run that saw the coin hit an all-time high of $63,729.5 in April.

However, the crypto’s value started tumbling in mid-May owing to China’s intense crackdown on mining activities. Other negative headlines, notably Tesla’s CEO Elon Musk U-turn on his decision to accept Bitcoin payments. He termed Bitcoin mining activities as bad for the environment. Moreover, this led to the coin losing almost half of its market value, trading at $30,895.42 at the time of writing. In essence, 2021 has arguably been the most volatile year in Bitcoin’s trading history, evidenced by unstable prices with intense market movements.

How much will Bitcoin be Worth in 2025?

Despite losing more than half of its value, Bitcoin has still got bright prospects. Numerous institutional investors and companies increasingly continue to adopt BTC after realizing its enormous potential. Various companies consider Bitcoin as a long-term institutional investment.

Bitcoin supply is capped at 21 million, and 18.5 million bitcoins have already been mined in its ten years of existence. Considering this, the increasing demand with a gradually diminishing supply will undoubtedly lead to a high price tag in 2025. Why? By then, there will be less Bitcoin to mine. The last Bitcoin is expected

Predictions by Crypto Experts

Different crypto experts hold varied opinions regarding the price of Bitcoin in 2025. In one study to map the future outlook of Bitcoin, a panel consisting of 42 crypto experts. They included crypto asset managers and cryptanalysts, predicted the price of Bitcoin in 2025. The panelists predicted that the price of Bitcoin would be $318,417 by December 2025 and rise to $4,287,591 by December 2030.

They stated that the price prediction was possible due to increased adoption by corporations and institutional investors, increased asset inflation, and loose monetary policy. Besides, the next bitcoin halving will also be instrumental in propelling BTC to this price point.

In a tweet Pavel Shkitin, CEO at Nominex exchange emphasizes that all industries are looking forward to deeper crypto adoption by world’s leading corporations so it could raise the Bitcoin price to 6 figures even before the end of this year. The next halving cycle will show us increased adoption of Bitcoin as a legal tender by developing countries.

Pavel believes this trend will continue onwards and until 2025, Bitcoin will have replaced gold as a global reserve asset. It’ll start an enormous bull market and lead BTC prices to as high as $500,000.

Justin Chuh, Wave Financial’s senior trader, predicts that BTC will end 2025 selling at $210,000 per BTC. He claims that Bitcoin has proven itself as a tried and tested haven of digital assets. He also stated that it would reach the price point due to halving events and extreme inflation, triggering enormous price moves.

Max Keiser, the Host of The Keiser Report, predicts that BTC will be worth around $100,000 in 2025 and $400,000 in 2030. Robert Kiyosaki, the author of the New York Times bestselling book Rich Dad, Poor Dad, predicts BTC will reach $75,000 by 2020.

Price Prediction Based on Stock-to-Flow Mechanism

Developed by Bitcoin expert Plan B, the stock-to-flow price prediction model is a widespread mechanism of indicating the price of commodities and financial assets in the long run. The price prediction mechanism uses the assets’ digital scarcity, i.e., supply-demand mechanism, to predict the asset’s price at a particular point in time.

According to the stock-to-flow price prediction mechanism, Bitcoin will hit $100,000 at the beginning of 2025. The forecast also states it will rise to $150,000 by the end of the year.

How Will Bitcoin Halving Influence Bitcoin Price in 2025

Bitcoin halving refers to an event that occurs every four years where Bitcoin mining rewards are reduced by half. Currently, the mining reward is 6.25 BTC per block. However, it will reduce to 3.125 BTC in the next bitcoin halving expected to occur in the Spring of 2024.

The halving event will make bitcoin more scarce leading to a price rise. Historically, each Bitcoin halving event has been followed by an enormous price rise owing to the demand and supply rule.

Closing Words

Most crypto experts are optimistic that Bitcoin will rise in value by 2025, with its price ranging between $100,000 to $400,000 per BTC. 2025 will very much likely be the year of Bitcoin with a considerable probability of doubling its price. Increased institutional adoption, dwindling supply with the upcoming halving event, and increased fiat currency inflation are some of the reasons Bitcoin will grow in value by 2025.

Despite the optimistic predictions, the crypto market is highly volatile. It’s fostered by numerous extra factors such as global politics, business interest, global economic performance, and other factors coming into play in determining BTC’s price. Bitcoin’s market price is also increasingly being determined by enormous investors such as Tesla, led by its CEO Elon Musk. Such investors can cause a significant price movement by just a tweet.

Whether or not you should rely on these predictions to make a financial decision depends on your personal goals and investment strategy. However, one thing is almost certain: Bitcoin’s value and adoption will rise by 2025.

Chinese Crypto Miners are Back Online in New Locations, Hashrate Says it All

Chinese crypto miners are finally back online after a government-led crackdown forced them out of the country in June 2021. Much of the mining capacity moved to North America, Russia, Kazakhstan, among others.

Consequently, the hash rate had jumped about 55% from July when it had hit a two-year low. Bitcoin is also almost hitting $50,000 after losing more than half its value from its April peak.

The Chinese Crackdown

Cryptos are created or “mined” by powerful computers or devices. They use electricity to solve complex mathematical puzzles.

According to estimates by Adam James, a senior editor of OKEx Insights, about 90% of all mining in China fell offline. With China’s closure, any mining operation outside China gained immediately. It is because their mining compensation automatically rises. It works in proportion to its share of the global bitcoin network hash rate. Hashrate, on the other hand, is a measure of miners’ processing power.

After the ban on the mainland, mining plant prices plummeted. In April, a machine that sold approximately 4,000 yuan ($620) was available for only 700-800 yuan by May.

The Chinese manufacturers of crypto mining devices paused their sales soon after. They started searching for “excellent” power in foreign regions with their customers.

Although the price of Bitcoin was 50% below the all-time high throughout much of the summer, plugged-in miners were making tremendous profits. Several mining companies reported that Q2 of this year was the best they had seen.

Difficulty and Hashrate

Bitcoin’s hashrate is now about 85 percent recovered after China banned it earlier this summer. It shows that the crackdown has caused extreme volatility. For example, by July, when the hashrate was at its lowest rate of 84.79 million (TH/s) by 2021, the network had its largest downward change ever, 28 percent.

The hashrate also came from huge North American miners. They most likely were plugging in computers ordered this year and recently got delivered.

The difficulty adjusts every two weeks roughly (or every 2,016 blocks). Depending on the number of miners in the network, the network ratchets it up or down. If more hashrate comes online during one of these two week periods, it will upward adjust the difficulty. That is because more miners produce more calculations than before to locate blocks.

Even if the difficulty of Bitcoin mining is growing, it is a favourable moment for miners. “Look at the price run percentage that Bitcoin has had throughout the previous 12 months. You will see the increase in the hashrate percentage, and it is nowhere in line.”

For a look at all of today’s economic events, check out our economic calendar.

Bitcoin is trading at $49,410 at press time, up 4.23% over the past seven days.

 

Here’s Why Short Term Trading is More Profitable than Long Term

Millions of merchants join the cryptocurrency world with a common goal of maximizing profits. As such, investors must grasp several trading strategies to become successful in the decentralized economy.

Today, there exist many types of traders within the digital asset market. What separates these investors is the long-term or short-term trading route they take. Long-term trading involves holding digital assets for extended periods. Traders under the long-term method usually believe that specific digital coins may turn out as profitable in the future.

Investors perform trades for shorter periods in a short-term setup, ranging between hours, days, or weeks. This piece uncovers why short-term traders have an advantage over long-term traders.

Why Short Term Generates More Income Than Long Term Trading

A lot can happen in the digital asset market, depending on the set timeline. Thus, durations play a significant role in determining the outcome of an investor’s trading strategy. Bearing that in mind, here’s why short-term trading is more profitable than long-term trading:

It Leverages Recent Trends

Short-term investments heavily rely on the recent events taking place in the crypto market. Here, users watch the market and make sound trading decisions based on their findings. For instance, influential figures such as Elon Musk embracing Bitcoin payments is positive news that can accumulate profits for users.

However, the mogul declined to use Bitcoin because of the environmental harm it causes during the mining process. As such, leveraging occurrences cannot be applicable for long-term trading since trends tend to change over time.

Requires Less Capital

In long-term trading, users make heavy investments because they are optimistic about a crypto asset’s future. However, the volatility rates of cryptocurrencies do not guarantee that investors can save their capital. Investors in the short-term trading field can make profits out of a small amount of capital.

It removes the pressure of requiring a bigger capital just to accumulate profits. As time goes by, short-term traders can continue upgrading their capital depending on their budgets.

The Market is Active

The cryptocurrency industry is a highly active market that operates around the clock. Being a broad and dynamic market, short-term investors vigorously make trading decisions that can uplift their incomes. So, short-term crypto investments are reliable for anyone at any given time.

Immediate Reinvestment

Investors using short-term methods can make immediate reinvestments from what they gain. Long-term strategies such as staking hold the investors’ assets and, in most cases, lock their holdings in digital wallets.

It, therefore, limits users from reinvesting in their growing coins. Short-term trading eliminates such barriers and enables investors to make an extra investment after making profits.

Limits the Hassle of Researching

Finding out more about a platform’s offerings is part and parcel of any investment journey. Nevertheless, short-term trading methods require less research time than long-term trading strategies. Short-term investors only need to grasp basic information and carry on with their trading activities.

Long-term tactics take a more comprehensive approach since users will commit their holdings for a longer time. In the end, long-term investors may experience losses even after dedicating their time to research.

Short Term Strategies Investors Can Use

Crypto traders can use the following types of short term strategies to secure adequate profits:

Scalping

Scalping involves making trades using a digital currency’s price movements. Under this strategy, traders act upon price shifts taking place within seconds or minutes. Experienced scalpers earn incomes by looking for time-sensitive opportunities. Thus, Scalpers develop consistency and chart reading skills as they gather continuous profits.

Arbitrage Trading

Arbitrage trading operates as a short-term strategy that relies on different market offerings. Investors buy digital assets from one exchange and sell them in another exchange, offering higher prices. The speed of an investor is what matters a lot in arbitrage trading. Another option is triangular arbitrage which uses the values of three assets on one exchange. Arbitrageurs make use of the price differences between exchanges to realize profits.

Leverage Trading

In leveraged trading, crypto exchanges allow investors to borrow funds and use that position to generate profits. Traders with smaller holdings can increase their buying power using the exchange’s long-short positions.

Trend Lines

Trend lines allow users to analyze the crypto’s momentum and enter into a trading position. On some occasions, traders hold the same positions for more extended periods. Nonetheless, the general idea behind trend lines is to watch for any upward or downward shift and speculate the asset’s next movement.

The most common trend indicators used include relative strength index, moving averages, and the moving average convergence divergence (MACD)

Closing Thoughts

Short-term trading allows investors to exploit the current market movements and accumulate gains. More importantly, short-term trade caters to budget-sensitive traders who wish to stick to their plans.

Through short-term trades, investors can receive updates on what is happening in the digital asset market. In the long run, investors gain more experience in handling and executing different types of trades.

For a look at all of today’s economic events, check out our economic calendar.

Why Watchdogs Have no Intention of Promoting Crypto Adoption

However, more investors are clocking in as most cryptocurrencies continue to hit new highs. After years of minimal attention, both watchdogs and lawmakers are now trying to look into cryptos.

Why Watchdogs Are Not Promoting Crypto Adoption

Despite the positivity surrounding cryptocurrencies, watchdogs are still refraining from promoting them. Here are some reasons that could be behind this:

Cryptos are Still in Infancy

Cryptocurrencies have received much media attention over the years. Despite this, the market size is still tiny compared to fiat and Gold. The bitcoin market at its peak was only about $1 trillion. On the other hand, Gold was at $7.9 trillion, while the U.S. stock market was $28 trillion.

This small scale of the market means that minor influences can have a more significant price impact. If an investor group decides to sell 500 million dollars in Gold, the price of Gold will hardly waver. It is enough to disrupt the entire market and crash the price if the same happened with Bitcoin.

However, the development of the cryptocurrency sector also implies that new and innovative ideas are yet to come.

Cryptocurrencies Are Highly Volatile

The cryptocurrency market is known for its wild price swings. Stability does not apply only to cryptocurrency but to all currencies out there. To be used as a trusted exchange medium, the change in price day in day out should be minimal.

Since cryptocurrencies are quite the opposite of this, watchdogs are pretty skeptical. People are yet to accept crypto as real money because they fear that they could lose value overnight.

That’s not all. Due to the unpredictable prices, regular money services such as currency conversion, ATMs, and remittances are pretty hard. Businesses will have to hedge their risks by charging very high fees.

In turn, this defeats the original purpose of cryptocurrencies. It entails a cheaper and more flexible payment method. Until cryptocurrencies are more stable, watchdogs will not be advancing promotion.

Buy Today, Sell Tomorrow

When the crypto bubble grew in 2017, several financial consultants urged their clientele to place bets on Bitcoin and others. However, by the end of 2018, most of the more prominent brokering companies began to ban the trading of cryptocurrencies and deem them excessively speculative. This move pulled potential investors off the expected crypto market.

It does not provide comfort that bitcoin could protect against inflation in ten years if you risk losing out today. Many crypto buyers continue to buy coins for short-term speculation, thus jeopardizing the stability of market prices.

Crimes Related to Crypto are Still at Large

The value of cryptocurrencies keeps on soaring. In turn, officials face a significant challenge in eliminating their use in online fraud and money laundering.

Fraud, followed by theft and ransomware, was the primary cryptocurrency crime in 2020. Half or around $129 million of all theft hacks, which are operations on platforms that promote lending outside of banks, were hacks linked to decentralized finance (DeFi).

Losses from cryptocurrency theft, hackers, and fraud dropped 57 percent to $1.9 billion last year, as market players enhanced security mechanisms, but crime increases in decentralized finance. Centralized fraud regimes face regulation and enforcement, which drive fraudsters to use decentralized financial services.

The renewed scrutiny and interest of cryptocurrencies, as institutional investors, entered digital assets, pushing them this month to new all-time highs.

The government is working to identify the available digital currencies and how to tax and govern them. Until clear guidelines and regulations happen seamlessly, watchdogs promoting cryptos are unlikely.

Patience is Key

Besides the whims of the market, most cryptocurrencies have no direction, so it’s not clear where they will end up. Nonetheless, a few noteworthy coins have invested in tactics that push them in a particular direction.

Even though it seems appropriate to market cryptos because of their high price, waiting is necessary. A currency needs time to grow and move up with the people. Cryptocurrencies need to stabilize first before being used comfortably as a store of value and for day-to-day payments.

The world has changed and is still changing swiftly. The speed at which cryptocurrencies are taking over indicates that traditional financial institutions can no longer keep up. Similarly, in the pursuit of total social and financial inclusion, the world faces an increasing need to tear down boundaries – this technology has all it needs to meet these concerns.

It is only about time until these cryptos find a way into our lives and shape them more effectively, taking account of economic growth and inclusivity. Meanwhile, watchdogs will be watching and solving crypto-related issues where possible.

Conclusion

Watchdogs are pretty hesitant when it comes to cryptocurrencies. It may continue for a while until more growth and maturity improve in the cryptocurrency space. First, cryptos are still young and highly volatile. They are also associated with crime, which different bodies worldwide are trying to tackle.

Also, the fact that most people buy them for-profit and not store of value for the future. Until such issues are addressed and tackled, watchdogs will remain on the sidelines. But, who knows? Maybe in a few years, they might be the ones pioneering crypto marketing for more adoption.

Here’s Why El Salvador Made Bitcoin a Legal Tender

The rare event happened in June of 2021, marking what could be a turning point in the crypto world. Until this announcement, Governments have been combative where cryptos are concerned. Their regard for this digital asset ranges from accepting them as investment assets but not currency to placing total bans on their use.

What this acceptance implies on the ground is that Salvadorians can use bitcoin as a medium of exchange. Pretty much the same way they use the US dollar and previously the Salvadorian colon. One can now buy products in any outlet countrywide.

Causes of El Salvador’s adoption of Bitcoin

It would be wise to know more about the reasons behind such a move. Why is El Salvador finally deciding Bitcoin should be a legal tender?

Make Remittances Transfers Less Costly

Firstly, its economy is dependent on diaspora remittances. Such receipts account for close to 25% of the country’s GDP, and they are an integral part of the levels of its economic vibrancy.

Given such a position, costs associated with sending remittances back to the country are very important. The government of Nayib Bukele, the country’s president, affirmed this situation via a tweet. Making Bitcoin a legal tender makes the process of receiving funds from abroad more accessible to recipients. There are cost benefits, helping users to avoid the high transfer fees charged by third parties.

Increase Financial Inclusion Rates

El Salvador faces the same issues as most developing countries, low bank account penetration rates. The key cause is inadequate infrastructure concerning financial services providers such as bank branches.

To counter this problem, the president believes the adoption of cryptos is a better fit. As a start, Bitcoin is a digital currency implying no physical form. It, therefore, doesn’t necessitate the presence of physical branches to enable accessibility. Physical branches have huge construction costs and support infrastructure to the branches like roads and electricity.

Boost the Nation’s Levels Of Economic Growth

A key consideration for adopting Bitcoin as a legal tender by El Salvador is to address its yearly low GDP growth rates. According to world bank data, the country has not breached the 4% GDP growth rate barrier for the past decade.

Among the issues leading to that has been monetary troubles, which led to the adoption of the US dollar as legal tender. However, the government has opted to utilize bitcoin. The asset leaves El Salvador at a much lower exposure to external manipulation. Using the US dollar leaves the country at the mercy of the US federal government monetary policy instruments.

Potential Drawbacks

While very effective as a tool for cutting costs and increasing financial inclusion, there are drawbacks like every other thing. The flaws range from the implementation phase to economic implications. They include

Increased Exposure to Volatility

The volatile nature of cryptocurrencies is a headache. Only stablecoins get a more stable trading value. It isn’t particularly an issue to investors since they seem only to view returns from price gains. It’s what has made cryptos one of the best-performing assets during the Covid 19 induced economic recession.

But it becomes an issue where utilization as a unit of trade is concerned. Estimation of commodity prices will be a key concern given the huge swings in their value estimation. A land parcel worth 1BTC today may be worth 1.3BTC or 0.7BTC tomorrow.

Such price swings substantially increase the possibility of overriding as well as increasing susceptibility to hyperinflation. Once prices begin to skyrocket, it will be hard to break the momentum even when the government has monetary policies at its disposal. Cases like Zimbabwe’s hyperinflation are good case points.

Reduced Government Control on Monetary Policies

Another unforeseen issue with Crypto adoption as a legal tender is the loss of effectiveness in government policies.

Governments hold tremendous power in influencing the direction and vitality of economies all over through monetary policies. Increasing or reducing the money supply to the economy can affect inflation rates, change interest rates on loans, or even influence exchange rates. It has, however, come out that they abuse these powers many times to the benefit of a few.

Cryptos like Bitcoin, on the other hand, pose a key problem. Apart from stablecoins, crypto prices lean on the forces of demand and supply. Such a system of price determination is very effective for investment gains while also eliminating currency manipulation rates. But it means that the El Salvador government will have no way of controlling inflation. It won’t also be able to stimulate the economy during a recession or influence lending rates.

Closing Remarks

Adopting crypto as a legal tender is quite beneficial to several parties. The government will increase financial inclusion while also reducing exposure to foreign government policies while boosting growth. El Salvadorians will be able to enjoy cheaper rates of financial transfers. Those are the key reasons as to why the government went the bitcoin way.

A big beneficiary is the crypto community, more specifically its credibility. But issues such as susceptibility to price volatility and inflation need to be addressed.