As crypto markets evolve, governments are planning to regulate the space, a move that could lead to more stability and higher acceptance for cryptocurrencies.
In 2017, Bitcoin went up. And up, and up…
Then, it came crashing down. And now it’s shooting back up again.
Today, investors are questioning whether cryptocurrencies have a future. These alternative currencies are mined, managed, marketed, bought and sold with little oversight from banks or regulatory agencies.
Once, that was exciting. Now, it’s led to a surge of interest in the regulation of Bitcoin and other cryptocurrencies.
For the crypto market to mature and become a safe, profitable environment for investors, greater regulation of the space will be needed.
One company, Hashchain Technology Inc. (TSX: KASH.V; OTCMKTS: HSSHF) is working on proprietary software that can help users comply with looming regulatory protocols. KASH is already a big name in the crypto mining sector, now it is on course to become a diverse blockchain tech company with exposure to many aspects of the crypto market.
It’s the next step in the evolution of the cryptocurrency world: from the Wild West to something a little more stable.
#1 Need for Regulation
The value of cryptocurrencies shot through the roof in 2017. Bitcoin reached an impressive $19,000, with the value of other big-brand cryptos like Ripple and Ethereum seeing equally impressive returns.
Everyone was talking about bitcoin and the blockchain technology that made the crypto revolution possible.
But bust followed boom, and by the end of the year, prices were falling rapidly.
By mid-February, crypto prices were oscillating wildly.
One of the major reasons for the steep drop in crypto prices was uncertainty: most cryptos were unregulated, initial coin offerings (ICOs) took place in a “wild west” with no oversight from financial regulatory agencies.
Now, with the crypto market coming under closer scrutiny, people are worried about fraud, artificially-inflated prices and insecurity in the crypto market. Currently, investors face a very real threat from hackers and scammers who are taking advantage of the innovation within the crypto space to take investors for a ride.
One example of fraud in the crypto market is the company Bitconnect, which is now the subject of a class-action lawsuit. Investors accuse the company, which created and marketed a crypto-currency to act as an alternative to Bitcoin, of acting as a Ponzi scheme.
Financial regulators, who mostly view cryptocurrencies with skepticism, are calling for greater oversight.
China and South Korea are considering bans on crypto mining, the energy-intensive process of creating new crypto tokens, with both imposing much stricter laws on how coins are created and traded.
South Korea, where Bitcoin has a strong following, is considering licensed cryptocurrency exchanges, where regulators can monitor transactions and watch out for fraud.
The U.S. Treasury’s Office of Terrorism and Financial Intelligence is worried about new cryptos being invented for the purpose of laundering money, citing the new “petro” crypto invented by the government of Venezuela.
Crypto companies aren’t ready to despair quite yet, however. The feds so far haven’t indicated they plan on banning mining or trading of crypto-currencies.
Rather than crush Bitcoin, the U.S. government hopes to regulate it. The IRS wants crypto investors to start reporting their profits, allowing for more accurate taxation of crypto gains.
Prices bounced back on the news. There’s a future in cryptocurrency mining, but the days of the crypto Wild West are over. The next stage of cryptocurrencies has begun.
#2 KASH Steps In
One company is well-positioned to take advantage of the turn towards regulation. Hashchain Technology Inc. (KASH), is a blockchain tech firm that approaches the crypto marketplace in a unique way.
As well as being a significant player in the Dash mining space, KASH plans to mine other cryptos in order to develop a diverse portfolio of assets.
But the company’s future is in regulation.
The company announced the acquisition of Node40, a blockchain firm, for $8 million, giving it access to the Node40 management accounting software which delivers up-to-date information on crypto transactions.
“This is our niche,” CEO Patrick Gray told Oilprice.com, “and what differentiates us from everyone else.”
The Node40 software gives KASH insights into how crypto trading changes on a second-to-second basis. The acquisition is an important step in facilitating regulation to the crypto marketplace but from private initiative rather than pressure from Uncle Sam.
#3 Mining and Investment
KASH is also prepared to profit from the continued expansion of the crypto marketplace.
The company has increased its coin mining capacity. It now has 100 rigs deployed and 770 purchased after a delivery in January 2018.
Crypto-mining can be immensely profitable, even with the ups and downs in the markets. Compared to gold mining, which returns only 11 percent for investors, cryptocurrencies can earn thousands of times more when their value rises as it did in 2017.
KASH has 1.23 MW of mining capacity and has plans in process of raising that to 20 MW by the end of the year.
And that’s not all: KASH also has a “masternode” for the Dash currency, which earns it an 8 percent return. The acquisition of the masternode was made for $280,000 and KASH gets paid in Dash coins, but as Dash is one of the fastest-growing cryptos out there, it could bring big returns for KASH.
It all plays into the company’s strategy: diversify, bring exposure for investors to a wider crypto market, and embrace regulation in order to bring greater stability.
KASH, according to CEO Patrick Gray, gives investors the opportunity to profit from a volatile market, “that they can’t take advantage of themselves.”
#4 Is It Time to Act?
The Bitcoin boom may have slowed, but the crypto revolution isn’t done yet. In fact, it’s only just begun.
The gains in 2017 taught investors one thing: despite volatility, risk, and uncertainty, there was definitely money to be made mining and trading cryptocurrencies.
Now, governments are trying to bring the crazy crypto markets in line without crushing them completely.
Corporations like Kodak are producing their own branded tokens. Major governments, such as Saudi Arabia, are developing cryptocurrencies for use in international trade deals.
Wall Street is embracing blockchain technology. The innovations behind Bitcoin are expected to soon become commonplace in multiple industries, including healthcare, real estate, and shipping.
Companies like Hashchain Technology Inc. are getting ready to meet future challenges: unlike a lot of crypto players out there, they aren’t putting all their eggs in one basket. They’ve embraced regulation and diversification, and they’re in this for the long haul.
Investors should take notice. As the crypto market evolves, companies like KASH could be at the forefront.
This is just the beginning.
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Certain disclosure in this release, including statements regarding the the performance of the Company’s current and ordered Rigs, and expectations regarding future operations may constitute forward-looking statements. These include that KASH will dramatically increase operations, that the 3,000 Rigs will be successfully delivered, the 3,000 Rigs will perform as expected by management and the timing, installation and performance of KASH’s current and ordered Rigs will be consistent with management’s expectations; that mining capacity will increase to mine 20 MW; that KASH will hold a diverse portfolio of cryptocurrencies through mining and otherwise; and that KASH’s software can become part of a regulatory push for regulation of cryptocurrencies. The forward-looking statements in this release are subject to numerous risks, uncertainties and other factors that may cause future results to differ materially from those expressed or implied in such forward-looking statements. Such risk factors may include, among others, the risk that the 3,000 Rigs will not be successfully delivered from the manufacturer or, if delivered, not when expected by management, and the risk that the Company’s current and ordered Rigs will not perform as expected by management or that expected capacity is not achieved; that KASH may not earn cryptocurrencies through mining and may not be able to purchase them; risks related to changes in cryptocurrency prices, and the profitability of mining them; that cryptocurrencies will not increase in use as expected; the under-estimation of personnel and operating costs; that KASH will not receive required regulatory approvals for building new facilities, using power, or other aspects of its business; that cryptocurrency regulators don’t accept KASH’s accounting and other solutions; the availability of necessary financing; permitting of businesses that KASH intends to invest in; general global markets and economic conditions; uninsurable risks; risks associated with currency and cryptocurrency fluctuations; risks associated with competition offering better or cheaper solutions, attracting away employees or using tactics to drive out competition; risks associated with changes in the financial auditing and corporate governance standards applicable to cryptocurrencies; risks related to potential conflicts of interest; the reliance on key personnel; capitalization and liquidity risks including the risk that the financings necessary to fund continued development of KASH’s business plan may not be available on satisfactory terms, or at all; the risk of dilution through the issuance of additional common shares of KASH; the risk of litigation; the risk that KASH’s management and advisors may not contribute as much as expected to the company’s success; the risk and the risk that cyber-crime may severely damage the value of any or all of KASH’s investments. There may be many other factors that cause results not to be as anticipated, estimated or intended. Accordingly, readers should not place undue reliance on forward-looking information.
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