Being in charge of funding $1 billion in businesses based on blockchain technology, Ila Zhang does not have a positive attitude towards the market. Zhang joined the exchange two months ago to head its venture incubator named Binance Labs. She said, “We’d like the bubble to break. We still see a lot of hype in the market; valuations are high and unreasonable. We really think if the bubble bursts, it’s a good thing for the industry.”
She added that the market is attracting more users and boosting its bullish nature but once the crypto bubble bursts only the deserving projects will emerge. Although she did not speculate about the time, she says it will happen. Until now, Initial Coin Offerings have been able to raise more than $9 billion in 2017.
By volume, it has become the biggest crypto trading exchange after cashing in the boom of December 2017. Currently, it offers more than a dozen virtual coins on its platform.
Zhang is an ex-employee of Alphabet Inc. and a graduate from Stanford University business school. She said that Binance is trying to solve the issues created by frauds in the crypto space while complying with Cryptocurrency Governance Initiatives, or CGI. Initiative’s website is scheduled for a launch next week.
The investor added, “The main purpose of this is to fight scams and sh*t coins, and to boost crypto and blockchain technology.” Binance is trying to encourage token teams to provide their efforts in the initiative. Fund managers are advised to avoid pump and dump schemes and projects will have to work according to the details of their white paper.
The company will take strict actions against teams who break their commitments. In a telephonic interview from Beijing, Zhang said that it expects the 20 digital currency funds part of the new $1 billion fund to join CGI. The company has planned to use the $1 billion fund in the coming three to five years. The average investment will range from $1 million to $10 million. Till now four investments have been made with long-term plans in effect.
The exchange is focusing on companies that aim to solve issues in blockchain technology. However, some venture capitalists are still confused between investing in equity and tokens. Zhang, who also served as a director in Kleiner Perkins Caufield & Byers, a venture firm, for four years, believes that equity and tokens are valued separately.
She concluded, “If we see founders contribute to both sides, we’ll hold both sides. Sometimes it’s hard to see which one is more valuable, but our position is to support the founders and create value for the project as a whole.”
It should be noted that Binance coin saw an instant rise in its prices a few days ago to $16 but came down back again below $15. Market experts predict that the coins will undergo a steady and gradual rise in values. It is being hoped that the company will be guiding other projects towards more compliance with government regulations.……
Published by Shirley Rodriguez on January 13, 2020
If there is an industry that stands to gain the most from the emergence of cryptocurrency, it is undoubtedly the semiconductor manufacturers. The industry experts think that both bitcoin, as well as, the digital currency provides increasing opportunity in the face of rapid acceptance around the world. That is primarily because of the usage of the chips in mining virtual currencies, and the key players are focusing on consuming less electricity and allow faster processing of mining. The industry also sees the entry of more big players to get their share.
Advanced Algorithms
Costly mining machines are used to mine digital coins like Bitcoin or Ethereum or Litecoin. These costly computers perform with advanced algorithms, as well as, mathematical equations. This is required to crosscheck transactions apart from retaining a running ledger, chiefexecutive.net reported. If reports are true, then a mining rig could cost anywhere between $3,000 and $10,000. Aside from this, there is also a considerable amount of energy involved a minimum cost of $3,000 even in low-cost utility markets. Therefore, the semiconductor industry is forced to engage in a competition to make the most powerful, as well as, the energy efficient mining rigs.
Companies like Nvidia and AMD have benefited immensely from the growing mining of cryptocurrencies last year. This was also evident when their shares spiked last year partly because of the increase in Ethereum price. That is mainly because of increased demand from Ethereum miners that has created some graphics cards shortage though on a temporary basis. Additional sales from the crypto segment are predicted to be $875 million. This is despite the regulators tightening their noose around the digital coins sector as investors interest is growing at a rapid pace.
Bitcoin continues to be an equipment-intensive one though its prices have tumbled in the current year from last year. The increasing demand has obviously made cryptocurrency mining rig supplier, Canaan, to raise a maximum of $2 billion through an IPO. In 2017, the company could sell over 300,000 mining rigs.
Aside from this, Taiwan Semiconductor Manufacturing disclosed in April about the ambiguity in the cryptocurrency mining for offering weak guidance for the remainder period of the current year. That clearly suggested the influence of the digital coin sector on the semiconductor industry. Manufacturers indicated that mining chips represented about 4.5 percent of their total revenue in the third quarter and added $900 million last year.
Big Players Entry
It appears that big players like Samsung have understood the importance of cryptocurrency in the future digital payments market. This was also quite evident when the Korean firm indicated that it has started producing ASIC chips that are used to mine digital coins. A spokesperson told the media, “Samsung’s foundry business is currently engaged in the manufacturing of cryptocurrency mining chips. However, we are unable to disclose further details regarding our customers.”
Though Intel also disclosed its intention to enter the market, there was a delay in the manufacturing of 10 nm units until next year. Moor Insights & Strategy founder and president, Patrick Moorhead, do not see any scope for prices to fall in respect of ASIC chips ……
We are familiar enough with margin trading. Now, a million dollar question arises that what and how did margin trading contribute towards Bitcoin Exchange? Well, coinbase has added margin trading to its Bitcoin Exchange. You must be wondering how did it happen? No need to worry. We are going to clear all your doubts and queries related to the topic.
Here we go!
Cryptocurrency:
A cryptocurrency is nothing but digital cash which works as a medium of exchange.
For the security of final transactions and control of the creation of additional units, it makes use of strong cryptography.
Now, let us have a brief discussion over something called “ecash”.
An American cryptographer, David Chaum created anonymous electronic money called ecash.
So, as the name itself says, ecash is nothing but just the electronic money where “e” means electronic and “cash” means money.
Later, in the year 1995, he implemented it through Digicash. Digicash is an early form of cryptographic electronic payments. It required user software for withdrawal of notes from the bank.
In 1996, the NSA published a paper entitled How to Make a Mint: the Cryptography of Anonymous Electronic Cash. It described how a cryptocurrency system first got published in an MIT mailing list.
In 1998, Wei Dai published a description of “b-money”, as an anonymous which distributed electronic cash system.
Then, Nick Szabo described bit gold. Similar to bitcoin and other cryptocurrencies that would follow it, bit gold was described as an electronic currency system.
It required users to complete a proof of work function with solutions being cryptographically put together and published. Hal Finney created a currency system which was based on reusable proof.
GDAX has added margin trading to the platform, it is a cryptocurrency exchange run by Coinbase. Now, eligible traders can trade three times more leveraged order on Ethereum and Litecoin order books.
As we are pretty familiar with margin trading, we know well that it is a process when an individual borrows money from a broker to buy or sell the asset more than he/she could afford. Via buying and selling traders can make a very good profit than their own cash.
As Coinbase has launched the feature attempting to fit within the boundaries of the Commodity Exchange Act, the feature mainly geared towards institutional investors. It means that it is mandatory for the traders to certify that they meet one of the qualifications to be allowed to trade on margin.
The requirements include things like being a corporation with a net worth exceeding $1,000,000 and trading on margin in order to hedge risks associated with your business. Individuals need to have a minimum of $5,000,000 invested on a discretionary basis in order to be allowed to trade on margin.
Coinbase has excluded a large segment of its user base by deciding to build its product within the guidelines of the Commodity Exchange Act. Exchanges like delta.exchange offer margin trading to all the users. If the company wants consistency, then, it is necessary to move slowly and maintain a favorable relationship.
The company explained: “we’re committed to working with regulators as the blockchain space continues to develop, rather than take on unnecessary risk just to get features out more quickly. Some other digital currency exchanges have decided not to do this. For us, the best approach was to carefully design our margin trading feature and engage with the CFTC to make sure that GDAX remains compliant.”
Final Words
So, it was all about how did coinbase add margin trading to its Bitcoin exchange. We tried our best to discuss all the necessary details related to the subject. If you still have any doubts or queries, just feel free to contact and ask us.
If you have some other details related to the subject which you think can be a part of the content, definitely share with us. It will be great to have a two-way conversation.
Since its inception, cryptocurrency has managed to create a stir in the financial world. Broadly speaking, cryptocurrency is a digital or virtual currency that serves as a medium or platform for exchange. Financial transactions, asset transfer, and creation of more units under this system is only done under stringent cryptography. An important difference between cryptocurrency and other forms of digital currency is that cryptocurrency exclusively relies on decentralized control.
Like real currency, cryptocurrency is also entitled to taxation according to the rules of the land. Here is a comprehensive guide to help you understand the nuances of filing crypto currency taxes.
Taxation of cryptocurrencies
Before we go ahead, it is important to understand that these taxation processes may vary from country to country. Therefore, it is best to read up about the laws pertaining to your country of residence.
Cryptocurrency is considered to be a capital asset in most countries. Consequently, if you use it for sale, purchase or any monetary gain whatsoever, your gains will be under tax scrutiny. Likewise, if you incur losses in cryptocurrency transactions, you can deduct them in your tax ledger and obtain a tax reduction. There might be specific variations in these calculations between countries, but the process for tax calculation remains fairly standard.
When is your cryptocurrency taxable?
The IRS considers cryptocurrency transactions as taxable when a crypto trader sells it for any other currency, trades it for other kinds of cryptocurrency, receives it or uses it to buy something. In contrast, transactions that involve purchase of more cryptocurrency with other currencies, gifting it to someone within limit, transferring it between your wallets, and donating it to an organization that is exempted from tax.
Getting ready to file crypto taxes manually
If you choose to complete your crypto tax return yourself, you need to arrange:
● A complete transaction exports record from all exchanges and currencies, include details about each withdrawal and deposit, marked by trading pairs and commissions.
● Calculate the historical cost basis for the last 2500 transactions.
● Sort out the transactions and identify transfers between wallets and other non-taxable transfers and mark investments, transactions and trades.
● Fill up all relevant forms as specified by the IRS and provide all data that is asked for.
As you see, this process is quite elaborate and necessitates a lot of juggling between transactions across dozens of exchanges and wallets. To make matters more harrowing, there are several data formats to address. It is not uncommon for people to get frustrated with all this work, and end up overpaying taxes.
Crypto accountants and investors may have a difficult time trying to manage their crypto accounts and taxes. This is where a cryptocurrency trading software like zenledger comes to their rescue. It seamlessly monitors their wallets and maintains a clean record of their transactions and exchanges. Here are some ways by which Zenledger makes cryptocurrency taxation and management easy for you.
● Compatible with the IRS system
Zenledger has been designed for optimized functioning with IRS requirements. Therefore, it will create your cryptocurrency account statements and manage transaction details impeccably and in a format that is acceptable and compatible with the IRS guidelines.
● Quick and easy
With a crypto managing software like Zenledger, it is possible to create all necessary documents like income reports, capital gains reports, closing reports and donation reports. All these tasks, and much more, can be done just by a few clicks. Therefore, it is highly unlikely for you to miss any crucial detail that will make you overpay your crypto taxes.
● Compatibility with major exchanges and fiat currencies
Zenledger is a hundred percent compatible with all major cryptocurrency exchanges and fiat currencies across the globe. Examples include Bitcoin, Litecoins, Ethereum, Euros, Dollars, Yen, and Pounds Sterling. Therefore, Zenledger will be the ideal cryptocurrency tax software for anyone.
● Convenient and accurate
Another great feature of a software like Zenledger is that it has a great and intuitive user interface. This means that uploading transaction details, managing these details and creating tax reports is extremely hassle-free. In addition, it also provides details like Form 8949, Schedule D, and tax loss harvesting. It also allows you to visualize your entire transaction history under Grand Unified Accounting.
● Complete transparency
One of the striking features of Zenledger is its complete transparency when it comes to algorithms. This allows you to have total control over each item and to see how your tax obligation is calculated across all your wallets and crypto exchanges.
By choosing a crypto taxation software, you eliminate the hassles associated with arranging and tracking your transactions. Additionally, you ensure that you don’t overpay taxes.
The verdict
Whether you choose to manage crypto and taxes yourself, or choose an appropriate software to do these tasks for your, it is important to pay these taxes. According to latest regulations, many cryptocurrency exchanges have made it mandatory to report trading and transaction history to the designated federal bodies. In addition, several governments themselves are making more stringent laws to collect information about tax evaders buy collecting their crypto wallet and transaction details.
In case you fail to file these crypto tax returns, knowingly or unknowingly, you will be caught by the IRS and be made to pay a hefty fine. Since your crypto transactions are on a public domain and are not editable, it is best to declare any income or gains that you have from cryptocurrency……
