Cryptocurrency News Now!: Nvidia cuts crypto

Wednesday, August 22, 2018

Nvidia cuts crypto

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QUOTE OF THE DAY

"You learn more from failure than from success. Don't let it stop you. Failure builds character."

- Unknown

Happy Wednesday! Tomorrow the ProShares Bitcoin ETF faces its fate. The countdown is on. Your move SEC.

Cheers,
Blockchain Brew Team

MARKET

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*Information as of 9:30 AM EST

NEWS

Nvidia cuts crypto

Nvidia Discontinues Crypto Business Due to Low Profits

NO MORE CRYPTO

Nvidia, the world's largest graphics card and chip maker, announced on Tuesday that its cryptocurrency venture will be coming to an end
The company emphasized that this decision was made due to the lack of profitability for the business, not a lack of demand
As the cryptocurrency market has declined in 2018, Nvidia was no longer able to turn a profit on its cryptocurrency-focused mining chips

Nvidia's CFO, Colette Kress, commented on the companies strategy:

“We believe we’ve reached a normal period as we’re looking forward to essentially no cryptocurrency as we move forward. Our revenue outlook had anticipated cryptocurrency-specific products declining to approximately $100 million, while actual crypto-specific product revenue was $18 million, and we now expect a negligible contribution going forward.”

BEAT BY ASICS

Nvidia produced graphic chips for crypto mining, these chips are not able to compete with ASIC miners
An ASIC miner is a computer chip or “integrated circuit” which was built for the single purpose of mining cryptocurrencies

BITMAIN STOMPING NVIDIA

Bitmain, the world's largest producer of ASIC miners, has made a killing off selling cryptocurrency mining hardware while Nvidia has struggled
In the first three months of 2018, Bitmain made a profit of $1.1 billion, twice as much as Nvidia's quarterly profit of $550 million

TRADING

Bitcoin Price Spiked $300 in One Minute After BitMEX Platform Goes Down

ONE MINUTE MOON

Last night, around 9:00 PM EST, Bitcoin spiked from $6,400 to $6,700 within one minute
The move has been usual of Bitcoin in the past, but Bitcoin hasn't had a one minute price surge of this stature during the 2018 bear trend

BITMEX TO BLAME

Many experts are blaming the $300 price surge on BitMEX, a popular crypto exchange that offers margin trading, for pausing all trading due to scheduled maintenance
As investors couldn't log into BitMEX, they could not alter their short contracts which had achieved a new monthly high yesterday
Thus, bulls took advantage of the opportunity to push the price of Bitcoin up and in the process, liquidated BitMEX short contracts to push the price up even further

MARKET MATURITY

Now, experts are concerned that the crypto market is not mature enough as the surge could be seen as clear manipulation
This event is not a great look for the Bitcoin market as the U.S. Securities and Exchange Commission decides on the approval of a Bitcoin ETF

Alex Kruger, a crypto trading analyst commented on the concerns that the price surge exposed:

"The BTC lightning +7% breakout during Bitmex’s downtime shows why odds of SEC approving the CBOE bitcoin ETF proposal should be close to zero. Even if no manipulation (that’s debatable) this stresses the importance of BitMEX, a fully unregulated market with 40% market share."

NEWS

Apple Co-Founder Steve Wozniak Hired by Crypto Startup

WOZNIAK & CRYPTO

Wozniak, an engineer by heart, has spoken about cryptocurrency in the past
The Apple co-founder has mostly praised Bitcoin and Ethereum while saying that the other coins are not as promising
However, Wozniak stated earlier this year that he does not view cryptocurrency as an investment and only owns one Bitcoin and two Ethereum just to experiment with the technology

WELCOME TO THE EQUI TEAM

Wozniak revealed on Tuesday that he has joined a cryptocurrency startup called Equi
Equi was founded with the goal of disrupting the traditional investment firm
The startup will allow investors to purchase equity in companies on the blockchain
Wozniak did not share details about what his role on the Equi team will be

Wozniak discussed Equi, saying:

"Our approach is not like a new currency, or something phony where an event will make it go up in value. It's a share of stock, in a company. This company is doing investment by investors with huge track records in good investments in things like apartment buildings in Dubai. We have one person in our group who has listed out a whole apartment building for bitcoin."

MINING

Bitmain Investor Deck is Causing Concerns Prior to IPO

DST DRAMA

As Bitmain is preparing for its rumored IPO, an investor deck has surfaced that Bitmain is using to pitch to its investors
CoinTelegraph acquired a copy of the investor deck and has since found some discrepancies regarding the investor DST Global
In the Bitmain investor deck, DST Global is listed as an investor who has "recently completed" the investment
However, when CoinTelegraph reached out to DST Global managing partner John Lindfors, he confirmed "DST has never invested in Bitmain"

STRIKE TWO

The DST drama is not the first time Bitmain has mislead investors
Recently, Bitmain closed its pre-IPO funding round and claimed that Japan's SoftBank was an investor
This statement has since been proven false as a SoftBank spokesperson said that "neither SoftBank Group Corp. nor the SoftBank Vision Fund were in any way involved in the deal"

SHOW ME THE MONEY

Another concern investors have is that Bitmain has yet to report Q2 results
Thus, the investor deck acquired by CoinTelegraph only shows Q1 results and does not represent the company's current situation

Blockstream CSO Samson Mow tweeted his concerns about Bitmain:

"Why is Bitmain raising capital so fast and only showing Q1 results to pre-IPO investors? We're well into Q3 now. The reason is Q2 was a disaster. Bitmain is sitting on a massive $1.24 billion USD in inventory and S9 prices dropped by ~85%! Q2 losses range in the $600-700 millions."

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BREW BITS

Coinbase released their "fundamental beliefs" regarding the exchange's institutional investor-related businesses.
Newest fad shows scammers are selling Ethereum logos to innocent buyers for the price of Ethereum on the Google Play store.
The Bank of Thailand revealed plans to use R3's Corda platform to develop a wholesale Central Bank Digital Currency.

LEARN LINGO

Double Spend

verb

If a malicious user tries to spend their bitcoins to two different recipients at the same time, this is double spending. Bitcoin mining and the blockchain are there to create a consensus on the network about which of the two transactions will confirm and be considered valid.

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