Why Bitcoin is down? Insane NEO FUD. South Africa. Tanzania. Kenya.

All prices are given in USD.

Hello everyone. My name is Nick, the host of Sobuka where I give commentary and opinions on what is going on in the cryptocurrency industry with respect to the southern and eastern hemisphere. On this channel, myself and others like Brian and Laura are always looking for ways to make our content and interaction better with the audience. Suggestions are definitely appreciated. So the area that I will cover today relates to Tanzania, South Africa, and Kenya which I covered briefly in my Bitcoin Flash report.[1] Understanding the cryptocurrency market in these regions have helped broaden my global perspective when it comes to Bitcoin and cryptocurrencies. I first want to look at some market anomalies in the cryptocurrency space since most cryptocurrencies have lost more than 25% of their value from their recent highs last week. Today I will look at several reasons why Bitcoin is down. I will also look at this FUD or confusion surrounding NEO.

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Why Bitcoin is Down

Bitcoin had about a $500-$1,000 pullback in recent days. What I can sense right now from the things that I read and watch is simply aggressive profit taking. In addition to that, people is Asia are afraid of the ICO ban that is being led by Chinese banks. Typically when prices like this surge higher and higher for Bitcoin like in the past few weeks, you will have a cool down period, appearing as a huge correction. It was not just Bitcoin that took a hit. You also have top cryptocurrencies that fell like Ethereum and Litecoin. However, what is impressive is that Litecoin has been holding steady at the $70.00 price region while some cryptocurrencies have taken a 50% hit or more in their price. This was prior to Litecoin trying to hit $100.00. I was looking at Litecoin from Coin Market Cap, and the highest price it reached this past week was $91.32, which is very impressive. The following reasons that I have on why Bitcoin is down this past week is stated as follows:

As I just mentioned, you have profit taking and the ICO ban coming from China. The ICO ban has really spooked the market. And as such when Asia panics, prices start to tumble...and people scramble out the door like mice!
There is fear of more government regulation and scrutiny over cryptocurrencies. You have countries, not just the United States, like China and other nations in Eastern Europe posting warnings on some of the ICOs out here.

My own personal opinion is that we need regulation but not to a point where it stifles innovation, growth, and development. There has to be a balance between all the various stakeholders involved within the cryptocurrency market. This includes you/me, companies and governments interacting within this space. But I think most people can agree that most of these ICOs should be scrutinized to determine if there is fraudulent activities and involvement. Now I am not sure how new policies will look because again anyone can come up with their own version of Bitcoin. I do think the public has to be made aware of the various alternatives out there and perform their own research. I can give you some of my personal advice on what I look for in an ICO. Here are a few.

I want to know exactly who is involved and to what extent.
I also want to know if there are any companies backing the project. As a person who has been in this space for a few years, I can tell you that it is important that new investors coming into the crypto market must learn and try to understand the people and characters involved in the space.
Next, I want to bring up integrity. I bring up integrity because there are some bad people and actors in the market that you should avoid. And I will not name names, but I would ask you the viewers to do research on coins and tokens by just typing "scam icos, coins, etc" into you Browser and simply ask around the crypto market space on what people think about the new ICO companies that are entering the market.

So those are my two main reasons. If you guys have any ideas, please let me know as well. I definitely would like to know what you think. I also want to say that I watch this channel on YouTube called the ‘Bitcoin Meister.’ There is a guy named Vinny Lingham. He was on the show this past Friday and stated something to the effect of mentioning how "Bitcoin needs to be boring." He says he enjoyed the days when no one really talked about Bitcoin when it was relatively flat. Today with Bitcoin moving up in price, he finds himself always having to stay glued to his computer. And quite frankly, I also feel the same way. With the price action on all these cryptocurrencies going higher and higher, everyone including myself is having to constantly keep up with the news, headlines, and all the government involvement out there. To a certain point, it gets too much and so one has to take a break for awhile, breath, and get re-energized.

Insane NEO FUD

Talking about taking a break, I think it’s time we dive into the Matrix by talking about NEO. There was a whole bunch of FUD this past week surrounding NEO. It turns out the start of the FUD may have originated from Coin Telegraph, which is an online news media that focuses extensively on cryptocurrencies. Coin Telegraph mentioned in one of their articles how the Chinese crackdown on ICOs will impact NEO. So when this news came out, it first resulted in a snowball effect that cascaded to online news outlets and YouTubers (mostly Ethereum fans). They all started touting and bashing NEO. I thought this whole NEO news at first was interesting or fascinating because the Chinese government never said anything about cracking down or eliminating all ICOs initially. But anyway, this whole news brought the price of NEO down to where it is now trading around the $20.00 region. And what I find interesting is that Coin Telegraph had to come out again with another article on how Chinese regulation will be good for NEO.

I think what Coin Telegraph was trying to do was amend things there via damage control. Anyway, if you have been keeping up with news coming from my channel, I mentioned way before the Coin Telegraph incident on how Chinese regulation would help the cryptocurrency eco-system because it would make bad actors think twice about creating ICO scams.[7] It would also force people and companies looking to create their own ICOs to follow a blueprint, model, and go through certain checks, and maybe not ask for an insane amount of money like EOS which up to this date has collected more than $100 million dollars worth of funding. This regulation brought by the Chinese government in turn would help NEO because new ICOs that want to create smart contracts on NEO's platform will have to go through some vetting process. This would weed out ICO bums looking to jump into the cryptocurrency market, create their dummy smart contracts, and place it onto a billion dollar platform like NEO and just sit there idle, eating up bandwidth that more qualified ICOs could be using. So in a way, a regulation like this from the Chinese government would bring more efficiency to the cryptocurrency market.

And this whole FUD stuff that is going around in the crypto space should make people even more aware about the cryptocurrency environment. For example, there are bad actors out there that will run with bad news and place even more factious headlines to be disseminated to the public who do not know any better out of pure ignorance. Therefore what you had this week was some Ethereum people trying to use the NEO FUD to go against NEO. And there was also Bitcoin people out there guilty of doing this. To think that the Chinese government would ever do something to tout innovation would be like the Japanese taking a stop to produce electronics. It would be utterly mind-boggling and silly.

So let’s take a break from NEO and talk about what is going on with cryptocurrencies with respect to Africa where it's used mainly for remittances. Before I begin, what I find interesting is the different cryptocurrency markets around the world. For example, you have Asia where its mostly speculative. In the US and west, cryptocurrencies are seen as an investment. And in South America and Africa, currencies like Bitcoin, Litecoin, and even Ethereum are branded for remittances. In Eastern Europe, cryptocurrencies are seen as tech startups.

South Africa: Why You Pay Up To 35% More for Bitcoin in South Africa

But turning our focus back to Africa, I will now start with South Africa, where a headline came out on how residents of that country could be paying up to 35% more for Bitcoin in that region.[1] The article mentions the reason for this is due to the lack of supply of Bitcoin. So what buyers have to do is make deals with sellers for Bitcoin at a high premium. And I understand that this is bad news for buyers out there as issues like this in a “free market” should foster more competition. And I would say for anyone out there is South Africa who is having to pay a 35% premium on Bitcoin to please do research on other exchanges out there. Paying a 35% premium is crazy. If Internet access is not reliable, then I would go old school and ask around. But before I deliver on more suggestions, please make sure you follow the laws of your government. If you are not allowed to transfer Bitcoin to certain places, then do not do so. This channel does not advocate that you break the law. So with that said, if you have Bitcoin, you can transfer the currency literally anywhere as long as you have an Internet connection. There are plenty of folks online who would be interested in buying and selling bitcoin. But I know in some places in Africa, it might be tough to do so as Internet access in some places is not reliable or either it is very expensive as I have already mentioned. However with the advent of cell-phone technology, I think we will see this Bitcoin problem in South Africa slowly start to correct itself. And a price premium of 35% should incentivize more companies and exchanges to come and invest more into South Africa. I know there are definitely a couple of exchanges out there like ICE3X that offer not just Bitcoin but also Ethereum and Litecoin at a decent price.[8] And given how South Africa pretty much leads it's continent in terms of GDP right under Nigeria, I cannot imagine how or why there are some people paying this high premium over there. It just does not make any sense to me. If there is anyone in South Africa listening or reading this, if you have any thoughts of what is going on, please let me know the situation within that country. I would be happy to learn about the situation. You can simply leave something in the comments section, and I promise to get back to you.

Kenya: Bitcoin Payments Firm BitPesa Secures Greycroft As Lead Investor For $10 Million Total Funding.

And still on Africa, this now brings me into news about Kenya. An article about Kenya reads “Bitcoin Payment Firm BitPesa Secures Greycroft As Lead Investor For $10 Million...”[2] For people who do not know BitPesa, they enable companies to make payments to and from Africa. This move comes at a time where cryptocurrencies is becoming more popular in Africa where people use it as a means to trade, given how their local currencies is more suspect and inflated. If you have being paying attention to my channel, this move should not be a surprise as a few more cryptocurrency exchanges have recently jumped into the African bandwagon in the past several months. And though the Bitcoin trading volume at these exchanges are relatively small in size, one cannot ignore the growth and the need for better transaction systems in the African region. Also the concept of Bitcoin being a store of value comes very handy especially when one's own currency is getting devalued overtime. And it’s not just BitPesa making moves in Africa. You also have foreign companies from places like India. For example, Bitfrics, and indian based company is looking to set up an exchange within the region of Kenya. Bitfrics was even as bold as to state that their goal is to have 1 million new African customers within the next several years.[6]

Zimbabwe & Tanzania: Bitcoin Foundation Boss Urges Cautious Investment

Lastly, I want to cover news from Zimbabwe and Tanzainia where Llew Classen, the Bitcoin Foundation boss urges cautious investment in cryptocurrencies.[3] Llew urges that people should invest no more than they can afford in the cryptocurrency space right now. He was speaking at a TEDGlobal conference in Tanzania about the potential for Bitcoin in Africa. And in fact I have to agree with him. With so much investment in cryptocurrency technology in Africa, folks need to be more cautious. And even with Bitcoin at its current price, there are people buying this cryptocurrency at it’s all time high for Fear Of Missing Out (FOMO) which I can understand. The people buying into this space at such a high cost right now, a huge chunk are new investors pouring a lot of money into a space they know nothing about. Therefore when there is panic, you typically have huge flight away from Bitcoin where money would move out of the system and into fiat. Hence, this is the reason we see a major price correction like today. Currently there is Bitcoin activity going on in Zimbabwe and Tanzania. It is nothing to get excited about as I think the volume as of today is about $4k which again is nothing to boast about. But relatively speaking, year over year Bitcoin volume in that region has steadily increased which I believe would make a strong bullish case for small, agile, boutique investment companies to step in at such an early stage of entry.

Alright...That’s all I have for this segment ladies and gentlemen. If you want me to look at any specific country in detail as it relates to cryptocurrencies, please let me know. My only restriction is that the country must be in the areas I cover on this channel such as Africa, Latin America, Middle East, and South Asian Pacific. And lastly, If you like this content, please click the Like button on YouTube. You can also Upvote/Re-Steem this content on Steemit. For new people, you can also choose to follow me here on Steemit or subscribe on YouTube. Please feel free to post your questions below. I promise to get back to you.

Nick is a content creator for Sobuka with a background in programming, information technology, finance and digital forensics. He shares interest in cryptocurrencies by reporting on International Affairs. You can find myself, B, and Sarah here from time to time.

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Relevant Sources

[1]. Bitcoin Flash. Nigeria. Kenya. Australia. South Africa. Tanzania. China. By Sobuka. 9/1/2017. https://steemit.com/bitcoin/@sobuka/bitcoin-flash-nigeria-kenya-australia-south-africa-tanzania-china

[2]. “Why You Pay Up to 35% More For Bitcoin in South Africa.” Ghost Writer. 8/27/2017. https://businesstech.co.za/news/finance/194548/why-you-pay-up-to-35-more-for-bitcoin-in-south-africa/

[3]. “Bitcoin Payments Firm BitPesa Secures Greycroft As Lead Investor For $10 Million Total Funding.” 8/30/2017. https://www.forbes.com/sites/laurashin/2017/08/30/bitcoin-payments-firm-bitpesa-secures-greycroft-as-lead-investor-for-10-million-total-funding/#6d5e8af66066

[4]. “Bitcoin Foundation Boss Urges Cautious Investment.” Jane Wakefield. 8/29/2017. http://www.bbc.com/news/technology-41080478

[5]. "Bitcoin Flash. Nigeria. Kenya. Australia. South Africa. Tanzania. China." By Sobuka. 9/1/2017. https://steemit.com/bitcoin/@sobuka/bitcoin-flash-nigeria-kenya-australia-south-africa-tanzania-china

[6]. "1 Bitcoin = 2.60 oz of Gold. Australia Venezuela Mexico South Africa India and Kenya. By Sobuka. 8/4/2017. https://steemit.com/gold/@sobuka/1-bitcoin-2-60-oz-of-gold-australia-venezuela-mexico-south-africa-india-and-kenya

[7]. "Why Ethereum is Up?! Why NEO is Down?! Let's Talk Bitcoin Costa Rica." By Sobuka. 8/28/2014. https://steemit.com/bitcoin/@sobuka/ethereum-up-neo-down-let-s-talk-bitcoin-costa-rica

[8]. "Bitcoin News on Peru Israel Palestine South America InkaPay ICE3X Palestinian pound." By Sobuka. 7/4/2017. https://steemit.com/bitcoin/@sobuka/bitcoin-news-on-peru-israel-palestine-south-america-inkapay-ice3x-palestinian-pound

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cqdx (38) 7 years ago

BTC huge correction which is barely even started yet.

$0.00

1 vote

sobuka (49) 7 years ago

i say $2k. nothing past that..

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