Study: Bitcoin’s Worth to lose $44 Billion by Year’s End

Swiss researchers defined that bitcoin’s market plowback may fall as much as $44 billion, or 35% (at the writing time), by the end of 2018
09 April 2018   1397

If the sums got by ETH Zurich researchers are right, by year’s end bitcoin’s cost  should get a decrease by as much as $44 billion, some 35% below its current $121 billion (as of this writing). The recent study "Are Bitcoin Bubbles Predictable?" in join with a Generalized Metcalfe’s Law and the LPPLS Model by Spencer Wheatley, Didier Sornette, et al, of ETH Zurich’s Department of Management, Technology and Economics, and Swiss Finance Institute at the University of Geneva, Switzerland, respectively, is  endeavoring to make a prediction.

We develop a strong diagnostic for bubbles and crashes in bitcoin, by analyzing the coincidence (and its absence) of fundamental and technical indicators. Using a generalized Metcalfe’s law based on network properties, a fundamental value is quantified and shown to be heavily exceeded, on at least four occasions, by bubbles that grow and burst.

Spencer Wheatley, Professor of Business Risks, ETH Zurich’s Department of Management, Technology and Economics.

Nowadays it is known as the network effect. Mr. Wheatley guesses the number of bitcoin users is declining. The authors of the study confess the appropriate problems in determining the numbers of users. Most enthusiasts have multiple wallet address, and so counting them seems like a deadlock. But if it’s true price declines shed users, it’s likely just as true price increases bring more users. Instead, researchers use market capitalization as a better evaluation for user growth or contraction.

According to the published report, the predicted values for the market cap discover a present over-estimation of at least four times. The Metcalfe support line offer current values around 44, 22, and 33 billion USD, in contrast to the actual current market cap of 170 billion USD. Further, constant user growth in line with the decline of active users starting in 2012, the end of 2018 Metcalfe  forecastings for the market cap are 77, 39, and 64 billion USD respectively, which is still less than half of the present market cap. These results are found to be reliable towards to the chosen fitting window.

So, the current market looks similar to that of early 2014, which was accompanied by a year of sideways and downward dynamics. Some separate fundamental development would need to exist to justify such high valuation, which the scientists are uninformed of.

Israeli BTC Investors to Face Catch 22

They need to pay taxes from Bitcoin investing in order to avoid their property arrest, but banks don't take their money due to AML issues
06 August 2019   148

Bitcoin investors in Israel are faced with the impossibility of paying taxes, as local banks refuse to accept funds received from the sale of cryptocurrencies because of the risks of money laundering and terrorist financing. About this writes the local edition of Haaretz on August 6.

Bitcoin is not recognized as a currency in Israel, therefore, individuals must pay 25% of the income from cryptocurrency trading to the treasury, and legal entities - 47%.

Investor Ron Gross told the publication that he acquired bitcoins in 2011 and reported his income to the tax office. In 2017, the bank that served Gross began to refuse to accept funds received from the sale of bitcoins. The investor met with representatives of the bank to demonstrate to them a 70-page history of bitcoin transactions as confirmation of the origin of the funds, but failed to convince them.

The tax authority is aware of the problem, but they say the ball isn’t in their courts. I’ve tried working with almost all the banks, but the minute they hear the word ‘Bitcoin’ they freeze up.

Ron Gross

Bitcoin investor from Israel


Since Gross was unable to pay taxes on time, his bank account, home, and even scooters were arrested. According to the investor, the tax authorities know about the problem, but can do nothing.

According to Haaretz, the tax office is aware of $ 86 million in unpaid taxes on income from cryptocurrency trading. It is possible that the real amount may be significantly higher.

Roy Arav, another Bitcoin investor, kept the proceeds from trading Bitcoin in an account with Israeli bank Discount under the control of the Bit2C exchange. The bank refuses to transfer money to Arava’s personal account under the pretext that its politicians forbid it to transfer funds related to virtual assets to client accounts due to the risks of money laundering and terrorist financing.

Arav also could not pay taxes and was forced to sue the bank. According to the investor, the authorities entered his position and granted him a deferral of time for the consideration of the claim.