Vitalik Buterin, who lost $ 460 million, hopes for the future
yesterday at 12:06, views: 60159
A year ago, the world went crazy for cryptocurrencies. And now the web publishes photos of Chinese landfills, where they throw away piles of mining equipment. Last December they were given $ 20,000 for Bitcoin, now it costs less than 4,000. What was it: a brilliant business project, a bubble or a new financial reality that will still be established in the world? Among our experts, our creator Ethereum criptovaluta Vitalik Buterin answered our questions.
After its beginning ten years ago, a joke was worth a fraction of a penny. Those who once bought it cheap – not to mention miners, have become multimillionaires in recent months. Those who sold it in the early stages of capital growth will bite their elbows. Everyone else dreamed of acquiring Bitcoin in view of easy earnings in the future: it was expected to grow up to $ 100 thousand.
But the expectations were not justified: in the last year, the cryptocurrency managed to reduce the price by 6 times …
"The future is behind the crypt", "Buy bitcoin before it's too late", "I became rich 20 times in cryptocurrency" – social network tapes were dazzled at the end of last year.
Thousands of newly minted cryptoinvestors, who managed to "unite with the subject", organized a true fair of vanity, boasting an easy earning. Bitcoins and other similar currencies were bought by all those who had money for this, as a result the market was over-saturated, peaked and the course started to slow down.
Already in the winter of 2018, Bitcoin had a value of $ 15-17 thousand, then kept at $ 10-12 thousand, and in the fall it was rapidly losing capitalization, dropping below $ 4 thousand at the time of writing this article. Many factors contributed to the fall, starting from the inspections on the Chinese bitcoin exchanges and ending with the skepticism of billionaires Bill Gates and Warren Buffet – we will talk about this later.
"I can not even sell the farms I bought"
Now Bitcoin is an economic asset with a dubious reputation, but this does not deny the fact that in 10 years of "life" has achieved something inconceivable.
A payment system based on blockchain technology was created by a person (or a group of people) under the pseudonym Satoshi Nakamato in 2009. Along with it appeared the unit with the same name to account for operations.
In 2010, there was the first bitcoin exchange for real goods: an American, Laszlo Khanech, for 10,000 of these virtual coins bought two pizzas with delivery. Bitcoin gradually grew in price: it cost $ 10, then $ 300, then broke the unthinkable roof at that time of $ 1 thousand. Then they paid attention and began to take it seriously.
In 2015, the European Court attributed Bitcoin transactions to fiat currency payment transactions (ie, legal tender currency, not backed by reserves) and recommended that EU members should not tax value added transactions on these transactions.
In 2016, Japan recognized Bitcoin as legal tender, the United States declared it "decentralized virtual currency" and Switzerland equated to foreign currencies, which have the right to move and accept payments in the country. China recognized the cryptocurrency goods, also allowing their circulation.
In several countries, blockchain virtual money had a different legal status, but inexorably became part of the states' financial systems.
The popularity of the "crypt" among the population has grown: in 2013 there were about 2.9 million users of virtual portfolios in the world, and in 2017 there were 5.8 million, the portfolios themselves are still more: their number increased from 8.2 million in 2013 to almost 35 million in 2016, that is 4 times. Of these, 80% is used for the exchange of national currency for digital and 20% is associated with credit cards.
The largest number of portfolios is recorded in South and North America, as well as in Asia – of course, and Russia has not been aside. The company "Yandex" conducted a study that showed how the research queries on Russians for Bitcoin have changed in the last 9 years. As it turned out, requests began to appear, albeit very rarely, in 2009, after the creation of a marvelous currency.
In 2010, the information flow on Bitcoin stabilized, but it was still weak: during this period, the first crypto-birds began to appear, for which "virtual" money could be exchanged for the usual currency. The peak of requests arrived in December 2017, when the exchange rate of Bitcoin reached an all-time high: during this period, Bitcoin was more often interested than the dollar rate.
In moments of general hysteria in the crypt, the interest of the Russians in the purchase of mining equipment also grew. Recall that any cryptocurrency can be "obtained" with the help of computers and video cards attached to them, which collect codes to solve various tasks in the blockchain system, receiving a virtual currency for this.
Judging by search engine data, in May and December 2017, the demand for video cards has increased significantly. This confirms the statistics of one of the free services.
Mining equipment is now searched three times less frequently than in January, and the demand for ready mining farms (which need to be assembled from multiple video cards) has decreased 2.5 times. The cost of the company itself decreased by almost 38% in 10 months.
At the same time on the website of the ad aggregator, the search for the words "mining" and "Bitcoin" has decreased 4 times, and the number of advertisements for the sale of cryptocurrency equipment has grown in the same amount.
Due to the loss of interest in cryptocurrency from the beginning of 2018, the cost of equipment has almost halved: from 154 thousand to 86 thousand rubles. On the Internet, a harrowing picture is walking with a "mining farm" cemetery in China.
"MK" contacted one of those who entered the business of selling farms at the top and managed to make good money. But now things are not important, admitted a resident of Moscow, Alexei, who moved to the capital from the border with China Trans-Baikal Territory.
Last summer, it established supplies of ready-made mining mines from the PRC. Starting a business has been facilitated by old links with Chinese machinery wholesalers. With the fall and the beginning of winter there was no end of buyers. "The business was going great, while I was negotiating with a margin of 10%.
He flew to China for work once a month, which is quite expensive, but it was enough for that. When Bitcoin and other cryptocurrencies started to decline, the demand became fragmented. In general, I stopped doing this, I can not even sell the farms I've already bought, "Alexey said.
photo: shooting from the video
A "graveyard of mining farms" appeared in the Chinese province of Sichuan.
Spoofing, hackers and other problems
So why did the bitcoin fall from the dizzying height that you conquered a year ago? The trigger for the collapse was the actions of the American financial authorities in relation to the cryptocurrency.
In June, the US Commodity Futures Trading Commission requested data on the operations carried out by the major crypto-burgs Bitstamp, Coinbase, it Bit and Kraken. The commission was interested in knowing if the exchanges had used price manipulation schemes. In anticipation of the results of the inspections, the volumes of exchanges on the stock exchanges have decreased (who wants to invest in an unregulated market, if the exchanges manipulate the price?). The US Department of Justice has also initiated a criminal investigation aimed at identifying illegal methods of manipulation of courses.
One of these methods is spoofing, a frequent phenomenon in the cryptocurrency segment. The essence of the reception lies in the artificial placement of a large order for the purchase or sale of a crypt on the exchange (sometimes the sums reach $ 60 million) at a substantially lower price or more high of the actual value. In this case, the order itself is not closed and removed from the auction before the transaction.
When so many big deals are displayed, traders and trading robots start selling or actively buying currency to make it happen before attractive prices change. A crook at this time reveals real orders, which allow him to sell or buy expensive coins. On the illusion created, for example, by the high price of a currency, the exchange rate could rise.
Most of the heavy trading with spoofing – in particular, limits rates. However, this phenomenon still occurs often, and in particular on the most popular stock exchange – Bitfinex. Many suspect that the bag offers flash-free spoofing attacks and holds the tokens, selling them at an attractive price.
Even the New York prosecutor's office, which in April of this year initiated a procedure to analyze the work of the cryptocurrency trade, was interested in illegal methods. The reason was the message of different platforms on the inability to control or prevent market manipulation.
In addition to the impunity of manipulators, confidence in Bitcoin has been weakened, in the first place, by the strengthening of cryptocurrency regulation in the world (powers such as Japan and Korea have declared their intention to "tighten the vines") occurred in June 2018. From the first exchange they stole $ 37 million, and from the second – $ 30 million. It has been discovered that cryptocurrencies, which have become a product of exchange, are not so transparent and protected, and therefore unreliable.
Meta-morphoses have also occurred on the ICO market, an exchange tool to attract investors' funds to start or expand startups. These three letters are decoded as Initial Coin Offering and have received their name by analogy with the IPO (Initial Public Offering) – the traditional method of placing the company's income shares to attract investment. In ICO, instead of the shares, tokens are internal resources of the company that it intends to buy from investors. Translated from English, "token" means a sign or symbol that explains the essence of the term. A token is an accounting unit created on the basis of blockchain technology. Unlike a virtual currency, which can be exchanged for another currency or repaid, it has more features. When the company's project, published on the ICO, will work, tokens can be exchanged for goods, company services or receive dividends.
Last year, businessmen hurried to spend ICO, it was considered a relatively easy and inexpensive way to get funding for projects: all that was needed was to hire blockchain experts and promote them to investors . Because the market was not regulated and the whole process took place in a virtual space, there were many scammers who raised money for ICO investors.
"Now the cost of holding an ICO has risen dramatically, and the organizers of these transactions are responsible for failing to fulfill the obligations of investors, and the scammers have become much smaller, and the market has begun to regulate. 39. interest in provoking a speculative course has eased, "explained Arthur Ibrahimov, a lawyer of the company Prifinance, in an interview with MK.
Vitalik Buterin: "The year could be promising, but not accurate"
At the end of December last year, all their Bitcoins were sold by Bitcoin.com co-founder Emil Oldenburg, saying that this cryptocurrency has "no future". "Investment in Bitcoin is the most extreme investment you can make, people will start coming out of Bitcoin when they understand how it works," Oldenburg said in an interview.
He explained that due to the emerging scale limit of this cryptocurrency, large commissions are charged for its operations and the transfer rate is constantly slowing down. We try to explain: the blockchain is composed of blocks, their size is limited, and with the growing popularity of Bitcoin, the system does not have time to process all transactions. For this reason, the transaction fees were doubled every three months and several hours were needed for several days to confirm the transactions. This happened because the bitcoin was too popular: everyone wanted to buy it.
However, in the cryptocurrency as a phenomenon, Emil Oldenburg was not disappointed. He invested in Bitcoin Cash (Bitcoin Cash), an alternative to the classic "cue ball". It costs several times less than the "progenitor" and is gaining popularity, but so far occupies the 4th place in the top 10 of the most common cryptocurrencies. Bitcoin still dominates the market: its capitalization is higher than the total value of the remaining combined virtual currencies. At most, it was about $ 340 billion, but for the year it fell to $ 70 billion, or nearly 5 times.
Second place is broadcast in terms of capitalization between virtual currencies, the unit of account on the Ethereum blockchain platform. This cryptocurrency is called "digital analog of oil" or "digital gold" due to the complexity of its production, the limited supply and the high quality of investment. Like other cryptocurrencies, in the midst of the fall in the market, transmission has fallen several times: since January, its capitalization has fallen by 86%.
"MK" managed to contact the founder of the Ethereum platform, the Russian-Canadian programmer Vitalik Buterin. In his Canadian passport it is written like this: "Acne". According to the latest data, he now lives in Singapore. At 24, he is the owner of a multi-billion dollar state (according to some information, about 30 billion dollars – although this figure seems to be too high for many experts), the creator of one of the most promising blockchain projects and a person who mining circles is called Cryptobog.
Acne Buterin nicknamed Cryptobog.
Against the backdrop of the cryptocurrency crash, Vitalik has lost about $ 460 million, now there are about $ 40 million left over its encrypted wallet with ether, however, the genius of the blockchain is not discouraged, on the contrary, it seemed to expect such a change of events . Buterin answered our questions on the social network.
– Vitalik, I would like to know your opinion on the fall in the capitalization of cryptocurrencies: will it continue or will the market stabilize?
– The fall of the market is a model after such a stunning growth. It can still continue, but there will be a further pot (the period of time when the price does not rise or fall – ID), then rises to new highs.
– Have you heard about yourself or blockchain colleagues a loss of interest in cryptocurrency?
– Blockchain is now being introduced in various areas of developing countries. In this regard, the 2019 year should be promising, but not sure.
– Will these new course highs, of which you speak, exceed the previous one, last year? Is it worth buying an economic bitcoin or another cryptocurrency in anticipation of a new take-off? And if so, which one?
– It is worth buying any cryptocurrency from the top 10, but this is not sure.
We also asked Vitalik about the prospects of another Russian genius, Pavel Durov: the creator of the most popular domestic social network launches its cryptocurrency? Buterin did not respond, but it was recently learned that Durov plans to launch the TON platform (Telegram Open Network) by the end of the year. His trial version is 70% ready and everyone is waiting for the crypt to start selling, which can replace Bitcoin.
The platform itself is destined to become the basis for a new decentralized economy of the future. It will have an electronic wallet, a cloud storage, a secure micropayment platform and other "gadgets" that will appeal to those who dream of a free Internet (the platform uses technologies that allow work in Russia blocked by Telegram to create the platform).
photo: Ivan Skripalev
The story is not over
Against the backdrop of a catastrophe in the virtual currency market, the grips of the cryptic world remain calm. Professional traders are sure that those who do not understand the patterns of the market are sowing panic. In the jargon of exchange players, there is a notion of "hamsters": this is the name for novice crypto dealers, who are very susceptible to mass panic and sell or regularly buy cryptocurrency in the most unfortunate moments.
"The increase in the cryptocurrency rate last year is due to a wave of attention, not only from the community of profiles, but also from ordinary people who have nothing to do with either the financial sector ", observes Prifinans," For the last year the market cryptocurrency has changed a lot, as well as the attitude towards it.Many have suffered frauds because of the lack of legal regulation in this area in most countries.
However, what is happening now with the cryptocurrency market is more likely not a recession, but simply stabilization, there are fewer scandals and, as a result, enthusiasm subsides. The fact that big investors are starting to show interest in cryptocurrency is showing interest in stabilization, because for them only the tools that would allow them to work with this market started to appear. In favor of stabilization, the fact that countries have begun to develop and implement appropriate legislative works ".
The analyst of Alpari Vladislav Antonov believes that persistent uncertainty about the regulation of the cryptocurrency market prevents investors from returning to the purchase of e-cash. "But soon this problem should be solved: then the market will reboot and improve, the volatility of the coins will decrease.
However, I do not exclude that the drop in cryptocurrency prices is nothing more than the medium-term plan of central banks in countries that want to discourage individuals from working with virtual money, which can pose a threat to legal money (so-called ordinary money). Member, которых value устанавливается правительством – И.Д. "- полагает эксперт. Вместе с тем, даже в Международном валютном фонде признают, что нельзя игнорировать хождение криптовалют в финансовых системах стран. Глава МВФ Кристин Лагард рекомендовала, регулято рам стран изучить вопрос об эмиссии собственной цифровой валюты, чтобы компенсировать снижение использования наличных .
Очевидно, что история биткоина – короля криптовалют – еще не окончена. Не успевшие разочароваться в нем инвесторы все еще надеются, что он снова покорит отметку в $ 20 тыс: не в этом году, так в следующем. Другие верят, что будущее за альтернативными криптовалютами. Тем не менее, блокчейн и виртуальные деньги завоевывают мир, потому что за ними стоит ни много, ни мало новая идеология, в основе которой – прозрачность и децентрализованность (читай – свобода от регуляторов) всех операций. А это то, что в финансовом мире очень ценится.