Dan Roberts, Decrypt's Editor-in-Chief, joins the Yahoo Finance Live panel to discuss the latest crypto moves.
Transcript of Video
- So, Bitcoin recently crossed the $50,000 mark. It is currently retailing at roughly $48,000. It wasn't too far away from where it had been. Let's bring Dan Roberts back in. He's the Editor in Chief of Decrypt, and he'll explain what's driving all of this activity, at least in terms of Bitcoin. After that, we came to NFTs, so what's the deal with Bitcoin?
ROBERTS, DAN: Hello there, guys. It's great to be back with you. First and foremost, that little bounce that pushed it back to $50,000, I would add the caveat that, in the media, we always like to link Bitcoin price behaviour to news. And there's a temptation to wonder, "Well, what was the one incident that pushed Bitcoin higher?"
That isn't always the case. It's a bit of a logical fallacy. In fact, there's been some worrying news in the Bitcoin world recently. People in the crypto community were dissatisfied with what transpired with the Senate infrastructure bill, which did not change the language that applies to crypto brokers. Having said that, there have been a few encouraging indicators.
The number of active Bitcoin wallets has increased significantly, indicating that more people are buying and actively trading. Then there's Gary Gensler's recent comments about being open to a Bitcoin futures ETF, which has sparked a lot of interest. This is not the same as a Bitcoin ETF. This has resulted in an increase in the number of bets on Bitcoin futures.
Finally, we recently discussed the Chinese government's crackdown on Bitcoin mining. Now we're seeing data that implies there was a benefit, namely that mining has gotten more profitable as a result of the reduced competition. So, outside of China, Bitcoin miners are experiencing an increase in Bitcoin mining revenue.
So, for the first time in more than three months, $50,000 was a significant price milestone to reach. It was Sunday at the time. We can now watch it gradually slant back down. That's how it always goes. $50,000 has become a new price benchmark and resistance level.
- Dan, you know what's also fascinating is that we just got the Coinbase piece from CNBC. The fact that some people are having difficulty accessing their funds, including one family who, I believe, lost about $170,000. They haven't been able to locate it.
When we hear stories like these, where people are having trouble accessing their cryptocurrencies, I'm not sure how large of a challenge, or how important of a deterrent this could be for Main Street adoption.
ROBERTS, DAN: So, there are two questions there, correct? In other words, customer service concerns with Coinbase are nothing new. It's not difficult to locate sources to comment on a report about Coinbase's poor customer service. And, believe it or not, the firm is aware of this, and has chosen to ignore it for the time being. I mean, it claims it's working on it.
But, as you can see, it comes at a steep price. And I believe that, for the most part, they believe that their poor customer service hasn't cost them any business. And, of course, when it comes to hacks, many of the people you read about who have been hacked have been hacked as a result of their own actions, such as clicking a phishing link or having their SIM card stolen by phoning their phone company, and Coinbase gets to say, "Well, that's not our concern." That security breach was not caused by us.
So there you have it. However, you are correct in a broader sense. And I talk a lot about it. In the crypto space, I believe there is still a lot of friction. For the typical person, simply trusting Coinbase or a centralised exchange is sufficient. I'll buy some cryptocurrency and store it on the website.
However, crypto purists would advise you to buy cryptocurrency and move it off the exchange into a hardware wallet that you own the keys to. Of course, there is a risk, and you must not lose your private keys, or your passcode to access your crypto, because it is all you have.
- We've all heard the storey of that one person who would be worth millions if he could only find his key. Dan, hurry up. But not with blockchain. You can figure out what happened because the CNBC storey focuses on a single family. It's possible that the hackers sold it and pocketed the proceeds. But can't you track down what happened to the coins or coin derivatives they had and, at the very least, have a method to get them back?
ROBERTS, DAN: Wallet to wallet is what you can see on the public Bitcoin blockchain, Adam. As you can see, money was transferred from one wallet to another. And while many people believe Bitcoin is mysterious and anonymous, this is not the case. It's a semi-anonymous service.
Adam Shapiro's wallet did not send $200 in Bitcoin to Dan Roberts, according to the wallet. A24X322 percent transferred Bitcoin to this other wallet, according to the message. As a result, it's a little detectable. Indeed, there have been instances where authorities have been able to track Bitcoin via the blockchain.
But it isn't always easy, and it isn't always easy. On blockchain, you can't see a name or physical mailing address associated with the wallet addresses.
Let's talk about the NFT mania, Dan. This is something that has been taking over for a long time, I believe. However, VISA's entry into the NFT area was announced over the weekend. Justin Sun also paid more than half a million dollars for an NFT rock. What do you think about this, and what does it imply about the space's growth potential?
ROBERTS, DAN: Isn't it, however, also fascinating? Because we were discussing NFTs in March and April, when the market was booming. Then, by June, sales volume had plummeted, and everyone had declared NFTs dead.
A lot of media outlets an stories that said NFTs were no longer in use. They've returned. They've risen from the grave. Perhaps they weren't really dead.
They're virtually as heated as they were previously. I mean, for a couple of the hottest NFT collections like Crypto Punks and Bored Apes, yesterday was the largest sales volume day ever. And aren't these things all over the place? You mentioned Ether rocks, after all. We've taken the concept of pet rocks and turned it into a digital asset on the blockchain.
Now, I realise if you believe this whole thing is a load of nonsense. Some individuals, I believe, just can't wrap their heads around the concept of digital ownership of a digital art file that everyone else can see without owning it.
But, you know, even if you weren't the owner of any other piece of art, you could see, view, and share a photograph of it. And, in many situations, the folks who own these NFTs are really boosting up the neighbourhood. It's not just about purchasing, owning, and flipping something; it's also about the community.
Bored Apes is a nice example. They're a unique assortment of cartoon apes who look really awesome. Each one is distinct. However, once you have one, you will be entitled to a number of additional perks and privileges. And I believe that this is the most important aspect to grasp in order to comprehend the next boom: it's all about belonging to a club.
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