Young Koreans are reportedly turning to cryptocurrencies as a means of generating wealth in greater numbers , much to the chagrin of their employers.
Many of South Korea’s young workers aged in their 20’s and 30’s are leaving their average paying jobs to explore crypto day trading, according to a report by local news outlet The Chosun Ilbo on Tuesday.
Their goal is to escape poverty and amass enough wealth to buy a home – a dream many young people worldwide feel is out of reach.
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“I face the reality of being unable to afford my own home no matter how hard I save up my salary,” said one anonymous worker cited in the report. “There is no other way than cryptocurrency investments for me to accumulate wealth.”
Some employers even threaten to block access to crypto trading websites during trading hours as employees check on price fluctuations continually throughout the day.
Many employers are experiencing an exodus in the workforce of young people who are looking to make their fortune trading amidst the current crypto bull run.
This is particularly prominent in the IT industry where professionals are quitting their jobs once their trades have brought them healthy profits.
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The report cites success stories like Han Jung-soo who reportedly left his company of three years, after accruing over $2.6 million through trading.
“This is one of the reasons that IT companies have recently rushed to give big pay rises to their staff,” laments one team leader from a startup in the south of Seoul. “Most employees of IT companies in this area invest in cryptocurrency and we’re seeing workers quit after making more profits from their [crypto] investments than their jobs.”
See also: South Korea’s Top Financial Regulator Suggests All Crypto Exchanges Could Be Shut Down
A further five teams are to launch non-fungible tokens (NFTs) on digital soccer collectibles platform Sorare.
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Related StoriesIran’s central bank is reportedly allowing the country’s financial institutions to use cryptocurrency, derived from sanctioned miners, to pay for imports.
According to a report by the Financial Tribune on Saturday, the Central Bank of Iran (CBI) has notified money changers and banks of its amended regulatory framework for crypto payments.
The amendment means those institutions will now be able to pay for goods and services from other countries in a bid to circumvent U.S. economic sanctions. Some say the local crypto mining industry could generate as much as $2 million a day in revenue.
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The bank had previously stipulated only digital assets for import funding could be used by itself and no one else. All miner’s coins had to be sold to the bank directly, as previously reported.
CoinDesk attempted to contact the CBI but did not receive a reply by press time.
See also: Iran Reportedly Seizes 45K Bitcoin Mining Machines After Closure of Illegal Operations
Related StoriesMicrosoft and Intel are working together to more quickly and effectively identify and remediate cryptojacking threats for users, Intel said Monday.
Think back to April 2020, when coronavirus-related lockdowns were hitting the global economy hard, and only the most sanguine optimists – and politicians – saw any likelihood of a rapid reopening and rebound.
At that point, the risk of deflation loomed large in the minds of many investors because of the steep drop-off in consumer demand. Prices for bitcoin, (BTC), seen by some cryptocurrency traders as a potential hedge against inflation, stagnated below $10,000, even though central banks around the world were printing trillions of dollars of fresh money.
A year later, the mentality has changed radically: With vaccines rolling out and economists now projecting a buoyant recovery, four in five investors see inflation as far more likely than deflation, according to a new survey by German lender Deutsche Bank.
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It’s the second month in a row investors have logged such an overwhelming position, and so the idea appears to be sticking. Perhaps not coincidentally, bitcoin prices are now over $50,000.
“A vast majority (81%) agree that inflation is more likely after the pandemic while only 10% thought we would see deflation,” according to Deutsche Bank. The survey was conducted earlier this month and covered about 700 global investors.
Some 43% of investors responded that higher-than-expected inflation and rising bond yields pose the biggest risks to market stability, according to Deutsche Bank.
The price of bitcoin headed towards bearish territory Sunday before bouncing. Ether’s average fees have dropped over the past seven days, creating a potential trading advantage for some.
Bitcoin jumped Monday, reaching as high as $54,340. It was a powerful reversal after prices fell as low as $47,272 around 23:00 GMT (6 PM ET) Sunday.
The largest cryptocurrency was changing hands around $54,076 as of press time.
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Bitcoin’s recovery may spark momentum, according to technical analyst Katie Stockton of the Fairlead Strategies consulting firm.
“The bounce should persist this week,” Stockton wrote in her “Cryptocurrency Compass” report on Monday. “But the recent loss of intermediate-term momentum suggests bitcoin will meet resistance below $62,000.”
Based on CoinDesk 20 data, bitcoin has only been able to close above $60,000 on seven days in the entirety of its 12-year existence. All of those have occurred in the past three months.
With the $60,000 price point being a level of “resistance” where some traders might start selling, Stockton sees $40,000 as the price level where investors will start scooping up what they perceive as cheap BTC.
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“Support is near $42,000 as a gauge of downside risk within the long-term uptrend,” Stockton noted.
The news cycle is heavily dictating some of the price action in the crypto market, according to Michael Gord, chief executive officer of quantitative firm Global Digital Assets.
“I think we are seeing more regulations around digital assets implemented globally,” Gord said. “This might cause investors to take a more conservative wait-and-see approach and perhaps exit some positions to hedge the risk.”
There are a lot more eyeballs now on crypto. This may make some bitcoin traders more trigger-happy when it comes to the sell button.
In the derivatives market, funding rates had turned negative, generally seen as sign that traders aren’t hungry for long leverage. They are still near zero, according to data aggregator Skew.
Jason Lau, chief operating office of San Francisco-based exchange OKCoin, sees a lasting market recovery and further upside.“With leverage and derivative activity still coming off all-time highs – bitcoin futures open interest has declined over 30% from the peaks – a spot-led recovery might be setting up bitcoin for another leg up,” Lau told CoinDesk.
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Ether fees drop, but at what cost?Ether (ETH), the second-largest cryptocurrency by market capitalization, was up Monday, trading around $2,489 and climbing 9.7% in 24 hours as of 21:00 UTC (4:00 p.m. ET).
Over the past three months, the average fee paid on the Ethereum network to conduct transactions was approximately 0.0097 ETH. However, in the past week that average has dropped to 0.0079 ETH. It works out to an 18% reduction in the average cost of using the network, the primary ecosystem for decentralized finance (DeFi), consisting of programmable blockchain applications for trading, lending and derivatives.
Many might welcome this news, as often Ethereum network fees have been so expensive that DeFi applications are unusable and more expensive than centralized or traditional financial platforms.
However, Peter Chan, lead trader at quantitative firm OneBit Quant, says the fee improvement is a result of some traders building “bots,” or automatic systems, working directly with Ethereum miners. They have built a tool called MEV-geth that floods the network with transactions in the amount of 0 ETH in order to spot a preferential transaction sequence.
The dynamic appears to be resulting in an advantage for the traders.
“Basically, some of the bots decided to work with miners and there are immense amounts of zero-gas transactions mined,” Chan told CoinDesk. “The problem is that only whitelisted miners will be able to see these transactions, unlike where everyone can see in mempool.”
The mempool is the list of network transactions waiting to be processed and confirmed by the Ethereum miners.
“This black box creates asymmetric information tilted towards the miners,” Chan added. He suggested that people need to be cautious some more-advanced traders are getting information faster than others as a result of this cooperation with Ethereum miners. The bot uses a proof-of-work consensus mechanism similar to the Bitcoin blockchain’s.
The Ethereum 2.0 network upgrade on the horizon plans to switch from proof-of-work mining, which relies on solving cryptographic puzzles by computers to run, to proof-of-stake, which requires cryptocurrency balances to run.
“The best way to deal with this is to set a tighter slippage to protect your trade, especially if you are trading a niche token,” Chan said.
Read More: DeFi Reshapes the CoinDesk 20
Other marketsDigital assets on the CoinDesk 20 are all in the green Monday. Notable winners as of 21:00 UTC (4:00 p.m. ET):
Equities:
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Commodities:
Treasurys:
Tesla sold some of its bitcoin stash in the first quarter for $272 million in proceeds.
The sale trimmed Tesla’s position by 10%, Tesla CFO Zach Kirkhorn said on an earnings call Monday.
In the slide deck accompanying the company’s first-quarter earnings results Monday, Tesla mentioned the sale of some bitcoin:
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“Year over year, positive impacts from volume growth, regulatory credit revenue growth, gross margin improvement driven by further product cost reductions and sale of Bitcoin ($101M positive impact, net of related impairments, in ‘Restructuring & Other’ line) were mainly offset by a lower ASP, increased SBC, additional supply chain costs, R&D investments and other items. Model S and Model X changeover costs negatively impacted both gross profit as well as R&D expenses.”
Elon Musk’s electric vehicle company purchased $1.5 billion worth of bitcoin in February.
Kirkhorn said on the call that Tesla invested in bitcoin to earn yield on its excess cash in a low-interest-rate environment.
While the company continues to deal with global supply chain crunches like semiconductor shortages or ship port capacity, he said the bitcoin market is a liquid market with an optimistic future.
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“There aren’t many traditional opportunities to do this, or at least that we found … particularly with yields being so low and without taking on additional risk or sacrificing liquidity,” Kirkhorn said, despite bitcoin’s perception as a risk asset among most traditional financial analysts.
Telsa will continue to accumulate bitcoin through customer transactions and will make bitcoin-related announcements in the future, Kirkhorn added.
UPDATE (April 26, 22:20 UTC): Adds comments from Tesla CFO Zach Kirkhorn.
Related StoriesInflows to digital asset products declined to $1.3 million during the week ending April 23, down from $233 million the prior week, according to a Monday report from CoinShares, a digital asset investment firm.
The latest figure marks the lowest level of weekly inflows since October 2020.
Forgers in Russia sold more than $13 million worth of fake money in exchange for bitcoin, the national police said Monday.
Russian police arrested several people in the city of Nizhny Novgorod on allegations of peddling fake bank notes over the infamous Hydra darknet marketplace, Russian newspaper Kommersant reported Monday.
The alleged criminals managed to sell about one billion rubles (about US$13.3 million) in fake bank notes via online shops on Hydra, according to the outlet’s unnamed sources. Chainalysis considers Hydra the single biggest darknet marketplace in the world.
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The four people facing charges in a district court – Sergey Arisov, Ivan Aferov, Andrey Skvortsov and Oleg Efimov – reportedly printed bank notes and sold them on Hydra for bitcoin. When a buyer sent a payment, a courier would deliver a package with fake bank notes to a certain location and hide it. Then a courier would share the location with the buyer.
Often the package would be buried in a public park or a suburban forest in Russia, giving this delivery method a nickname translated as “hidden treasure” (“klad” in Russian). According to Kommersant, the police got to the ring organizers after catching several couriers. Police seized computers and other equipment from the ring’s headquarters.
The fake bank notes would normally cost 10%-15% of their nominal value for big batches and up to 30% for smaller batches up to 150,000 rubles ($2,000).
This CoinDesk reporter was able to find at least eight shops currently selling fake bank notes on Hydra. They offer bank notes with a nominal value 2,000 or 5,000 rubles, with prices starting at 0.0002 BTC for a bank note. All the shops recommended buyers spray the bank notes with hairspray after purchase to get the “required texture and typical crunchiness.” Names of brands guaranteeing such results were helpfully provided.
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According to buyers’ reviews, they would often find the “treasures” easily, and use the fake money to pay for things. In some cases the packages appeared slightly damaged, “stolen by mice” or not found at the designated spot. In one case, the buyer complained some people beat him up and took away the package.
CoinDesk reported previously that some online shops on Hydra are selling actual cash for bitcoin, allowing users to cash out their crypto to get the money without meeting a person to get it.
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“Currently, SOPR is approaching the full reset mark, meaning price has either reached, or is very close to reaching, the bottom of the current correction. Any dips below 1 have historically been great buy opportunities.”
Bitcoin Magazine Research’s Will Clemente Related Stories