Weekly Bulletin (Feb 24, 2019)

CoinSheet #245

Do not believe that it is very much of an advance to do the unnecessary three times as fast.

— Peter Drucker (1909-2005)


Weekly Bulletin

Hello folks,

Hope you’ve all had a great week.

Let’s get right into it.


Bitmain announces next generation 7nm ASIC chip

Last week Bitmain announced its next generation 7nm ASIC chip for SHA256 mining.

The new BM1397 chip requires lower power and can offer an energy consumption to computing ratio as low as 30J/TH. This is a 28.6 percent improvement in power efficiency in comparison with Bitmain’s previous 7nm chip, the BM1391.

A 28.6 percent improvement in efficiency.

If you’re interested in what I think about this, you can read a previous letter titled Miner centralization is a meme.

TL;DR - The whole “China mining centralization” thing isn’t the impending doom it’s made out to be.

I think shifts in economic pressure will inevitably lead to a re-decentralization of mining.

And a concentrated mining network doesn’t mean that Bitcoin is centralized.


Samsung Galaxy S10 will include private crypto key storage

As you’ve probably heard by now, Samsung’s new Galaxy S10 will include some sort of private key storage.

Now then, I’m not going to say that this is some government psy-op to steal your private keys.

But what I will say is that you probably shouldn’t store your private keys on a device that engineered to collect as much of your data as possible.

At least not yet.

The normalization of bitcoin infrastructure.

I like the sound of that.

Until then, just think of the bitcoin deflation with all them lost phones.


Ethereum Constantinople / St. Petersburg upgrade

Here’s a link to the announcement.

The Ethereum network will be undergoing a scheduled upgrade at block number 7,280,000, which is predicted to occur on Thursday, February 28, 2019. The exact date is subject to change depending on block times between now and then and could be activated 1-2 days before or after. A countdown timer can be seen at https://amberdata.io/blocks/7280000. You can monitor the network upgrade in real time at http://forkmon.ethdevops.io/.

I’m not gonna lie, I’m not particularly interested in all the technical talk about what this upgrade entails.

And most likely, neither are you.

What I’m interested in is that Constantinople will reduce the ETH block rewards from 3 to 2, decreasing new ETH supply.

Assuming all else remain equal (i.e., the complexity of what they’re working on doesn’t get any less complex), in the long run, this is decidedly bullish.


Coinbase acquired a surveillance company

Soooo Coinbase acquired a surveillance company.

Huh? Do tell? Whatever do you mean? What’s worse then that?

Arjun Balaji@arjunblj
Congrats to Coinbase on the acquisition of chain analysis startup Neutrino! FYI, the CEO, Giancarlo Russo, was ex-COO of HackingTeam (
en.m.wikipedia.org/wiki/Hacking_T…), who sold "offensive intrusion and surveillance capabilities to governments, law enforcement agencies and corporations."

Sold offensive intrusion and surveillance capabilities to governments, law enforcement agencies and corporations.

awkward cardi b GIF by Saturday Night Live

sell products that are used by authoritarian governments to commit violations of human rights and freedom of information.

This time it’s going to be something different tho. Ya know what I mean?


Market Sentiment

Technicals


Bitcoin (Daily Overview)

Here’s a link to the Market Update post I put out last week.

I’ll be sending these out to paid subscribers, and making them public the following week.

Here’s what I wrote.

Here’s what happened.

This drop happened quite suddenly (within an hour).

The next major support I’m looking at is the 50 SMA (orange line).


Bitcoin (4h Support/Resistance Levels)

Look how strange this chart looks.

Bitcoin has been ranging WAYY above what are it’s normal pivot points.

Drop was very much expected.


Bitcoin (4h Volume)


Bitcoin (Macro Overview)

Below are the 3 most common bottom scenarios.

  • Option 1: Fractals analysis bottom (2,300 - 2,600)

  • Option 2: Fib extension bottom (1,700 - 1,900)

  • Option 3: Retest support of 2017 rally bottom (900 - 1,200)

As of Feb 24, 2019 my confidence level are:

A bottom between 1,700 and 2,600 = about 70%.
We've already bottomed = about 25%.
Retest 900-1,200 = About 5% chance.


Recommended Readings

Privacy & Bitcoin

A deep-drive on privacy. A monster of a read.

While Bitcoin can support strong privacy, many ways of using it are usually not very private. With proper understanding of the technology, bitcoin can indeed be used in a very private and anonymous way.

As of 2019 most casual enthusiasts of bitcoin believe it is perfectly traceable; this is completely false. Around 2011 most casual enthusiasts believed it is totally private; which is also false. There is some nuance - in certain situations bitcoin can be very private. But it is not simple to understand, and it takes some time and reading.

You can read it here.


The end

What do you folks think?

Continue the discussion in our Telegram group.

That’s all for now.

See you later space Cowboy

-Dmitriy