Silicon Valley and ‘smart money’ are behind this Bitcoin rally, data suggests

Silicon Valley and ‘smart money’ are behind this Bitcoin rally, data suggests

The Google Trends interest is relatively low for the keyword “Bitcoin” while on-chain data shows smart money is accumulating BTC.

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Bitcoin (BTC) is continuing to show strong momentum even after a major rally. Key data points show that the uptrend has likely been fueled by smart money in recent months. This means retail or mainstream investors have been largely on the sidelines as BTC price surpassed $15,000 this month.

In 2017, when the price of Bitcoin hit an all-time high at $20,000, the retail demand was at its peak. Google Trends data soared, mainstream media coverage noticeably increased, and spot exchange volumes exploded across major markets, especially in South Korea and Japan.

This time, the Google Trends interest is relatively low for the keyword “Bitcoin” while on-chain data shows smart money is accumulating BTC.

High-net-worth investors are buying Bitcoin

Moreover, according to on-chain analyst Willy Woo, it has been mostly high-net-worth investors who have been purchasing Bitcoin.

Bitcoin mean transfer volume. Source: Glassnode

When whales buy Bitcoin, they mostly facilitate the deals through the over-the-counter (OTC) market. Over time, spot and derivatives markets trail the OTC market as whales lead the upsurge. Woo said:

“Who has been buying this rally? It’s smart money… High Net Worth Individuals. You can see the average transaction value between investors taking a big jump upwards. OTC desks are seeing this too. Bitcoin is still in it’s stealth phase of its bull run.”

The trend of whales frontrunning retail investors is optimistic because it shows Bitcoin is still in its nascent bull phase. Large capital from new retail and mainstream investors is yet to enter the cryptocurrency market.

Another Glassnode metrics paints a similar trend. The number of Bitcoin addresses holding more than 100 BTC hit a seven-month high at 16,271.

The number of addresses holding over 100 BTC. Source: Glassnode

New money is pouring in

Whales consistently buying Bitcoin over the past few months is optimistic in itself. But, Woo emphasized that the number of new whales has also increased.

If the number of addresses containing large amounts of Bitcoin increases, analysts consider it as an overall spike in new whales.

The rise in more high-net-worth individuals accumulating Bitcoin coincides with the start of the recent institutional frenzy around BTC.

Following Square’s BTC purchase worth $50 million, the number of high-net-worth investors in the Bitcoin market noticeably increased. Woo explained:

“Best of all we are not just seeing smart money flow in, it’s NEW smart money. Orange line is the rate of new investors coming in per hour previously unseen before on the blockchain. It’s seriously bullish.”

Google Trends data shows relatively low retail interest

Google Trends data is indicating a similar narrative as on-chain data points. The search volume for the keyword “Bitcoin” is currently less than 10% compared to the 2017 top.

Bitcoin search volume on Google. Source: Google Trends

Nevertheless, while the search volume for Bitcoin remains low, there is a particularly high interest coming from states like Hawaii, California, Nevada and Washington.

Bitcoin search interest by subregion in the U.S. Source: Google Trends

Interestingly, California and Hawaii rank as the third and fourth highest in per capita income by state in 2020.

Moreover, San Jose/San Francisco in California i.e. Silicon Valley is ranked as the top metro region for Bitcoin interest. Silicon Valley is, of course, home to many high-net-worth investors and entrepreneurs.

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The Google Trends interest is relatively low for the keyword “Bitcoin” while on-chain data shows smart money is accumulating BTC.

A City in South Korea is Expanding Its Blockchain Payment Program

A City in South Korea is Expanding Its Blockchain Payment Program

South Korea’s „Silicon Valley“ continues its love affair with Blockchain technology.

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A major satellite city in South Korea, Seongnam, is preparing to expand its existing blockchain-powered payment program by issuing new digital gift certificates.

According to Kyunghyang Shinmun, the city’s Blockchain infrastructure will rely on a mobile app named Chak app. This app will be built by the Korea Minting and Security Printing Corporation, or KOMSCO. Seongnam’s project hopes to make it easier for elderly and middle-aged residents to utilize the city’s existing Blockchain technology. They also hope to strengthen the use of contactless payments during the COVID-19 pandemic.

Local media outlets said that three digital gift certificate types – representing cash, check cards, and mobile cards – can be used at 45,000 card merchant locations across the city. 

Seongnam is well known for its Pangyo Tech Valley — an IT complex that serves as the headquarters for many of the country’s tech giants, such as Kakao Group, SK Telecom, AhnLabs, Nexon, among others.

The operator behind Seongnam’s project previously praised the record breaking profits brought in by its stablecoin and blockchain projects in 2020.

KEB Hana Bank, one of the biggest commercial banks in South Korea, reached an agreement on August 9 with the state-backed highway operator, the Korea Expressway Corporation, to bring blockchain-based toll payments to the nation’s highways.

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South Korea’s „Silicon Valley“ continues its love affair with Blockchain technology.

Overstock’s VC Arm Joins $31M Funding Round For Silicon Valley Fintech

Overstock’s VC Arm Joins $31M Funding Round For Silicon Valley Fintech

Overstock’s venture capital arm Medici Ventures joins $31 million funding round for Silicon Valley fintech startup

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Overstock’s venture capital arm Medici Ventures invests in PeerNova, a startup that develops blockchain-based solutions for financial institutions to synchronize their data across multiple systems.

In an Oct. 22 press release, PeerNova reported that it had raised $31 million in growth funding led by existing investor Mosaik Partners, with participation from Medici Ventures and Intuitive Venture Partners. This funding round brings the total raised funds to $74 million.

PeerNova, a California-based software company in the financial industry, is planning to use this financing to increase its market penetration and further develop solutions to solve some of the challenges faced by the financial industry. Commenting on the matter, president of Medici Ventures and recently appointed CEO Jonathan Johnson said:

„PeerNova’s world-class team is the force behind bringing this unique blockchain-based platform to market. PeerNova has products in production that are solving key trust and transparency challenges, removing friction, and allowing clients to seamlessly use their resources more efficiently.“

In September, Medici Ventures announced that it had invested $2 million in Salt Lake City-based Evernym, a startup that develops blockchain-based self-sovereign identity networks.

E-commerce giant Overstock lands in Ireland

Cointelegraph reported at the beginning of October that the online retail giant Overstock had opened a blockchain research and development center in Ireland. The firm’s new center can be found in “IDA’s flagship North West business park in Sligo” and is expected to reach a total number of 100 employees by the end of 2019. Overstock vice president and site lead David Kenny added:

“We’re absolutely delighted with our new home and getting all our teams back under one roof. It further validates Overstock’s choice of the North West as a great place to do business and build high performance software development teams. The combination of a diverse career path, a cutting edge tech environment and a great work life balance has really resonated with the techies who continue to join our growing team.”

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Overstock’s venture capital arm Medici Ventures joins $31 million funding round for Silicon Valley fintech startup

Pariahs of Silicon Valley: How Ben Mezrich Writes About the Winklevoss Twins

Pariahs of Silicon Valley: How Ben Mezrich Writes About the Winklevoss Twins

Ben Mezrich’s new book into the lives of the Winklevoss twins casts Mark Zuckerberg as the villian and the Winklevii as the heroes, but is it that simple?

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Molly Jane Zuckerman is the head of news at Cointelegraph. The views expressed here are her own and do not necessarily represent the views of Cointelegraph. This article contains spoilers.

The irony of a book about the Winklevoss twins’ journey into cryptocurrency — which stresses over and over again how important it has been to their legacy to eclipse their past dealings with Facebook and Mark Zuckerberg — getting published less than a month before Facebook’s secretive cryptocurrency project was unveiled to the world is almost too obvious a way to begin this book review.

“Bitcoin Billionaires: A True Story of Genius, Betrayal, and Redemption” is the latest book in a series of flashy exposés of some of the world’s biggest financial success stories from writer Ben Mezrich. Most well-known as the man that penned the book behind “The Social Network,” a movie that brought the Winklevii into the millennial zeitgeist as two tall, overly handsome, not-so-lovable Men of Harvard, Mezrich’s latest book explores the beginning of Facebook from the perspective of these mirror twins all the way through the making of their own billions in crypto.

However, the story behind the all-hail Mark Zuckerberg movie, “The Accidental Billionaires: The Founding of Facebook, A Tale of Sex, Money, Genius, and Betrayal,” shares a lot more than just a title full of billionaires, genius and betrayal — it now shares cryptocurrency.

Going back to the start, before this week when Facebook’s Libra project blew up both crypto and mainstream media, the Winklevoss twins were (and still are) arguably two of the biggest names in cryptocurrency. As a managing editor of a crypto publication, I’d been trained to look out whenever either of the twins said or did anything, as even a tweet of 120 characters from a Winklevii could get a story a high number of views.

Mezrich’s story gave me a new perspective on this Winklevoss celebrité: Apparently, before they became two of the kings of crypto, they were the black sheep of Silicon Valley. After the drawn-out court case between the twins and Zuckerberg over their right to a small part of Facebook due to their arguably initial idea that inspired Zuckerberg to create the global social network, Silicon Valley apparently cut the twins loose.

They sued Facebook and won. Now what?

The way Mezrich writes it, these two newfound millionaires (who had insisted on taking part of their settlement in Facebook stock, an idea that is portrayed as over-exaggeratedly opposed by their lawyers at the time) just could not give their money away. Their pariah status comes to a head in a well-known-ish diner in the valley, when a visibly nervous potential startup founder rejects their money after a previous acceptance, appears scared to be seen with them (although this attitude begs the question, why had he agreed to meet the two very tall, large investors in such a public place?), and explains to them in much overwrought, sweaty detail why their money will never be welcome in Zuckerberg’s Silicon Valley.

While this particular conversation with this degree of specificity may or may not have taken place, Mezrich’s point is clear: The Winklevii were not welcome in Silicon Valley.

The rest of the book flies by their introduction to Bitcoin for the first time (in a club in Ibiza) —

“‘Cryptocurrency,’ Cameron repeated, from his daybed. ‘It sounds criminal. Is it legal?’”

— to their fateful first meetings with Charlie Shrem

“Cameron couldn’t help feel the nervous energy bleeding out of the kid — Charlie was actually trembling — or smell the hint of marijuana seeping from his plaid short-sleeve shirt and distressed khaki pants.”

— the mutual intense dislike between them and “Bitcoin Jesus” Roger Ver

“As far as Ver was concerned, the Winklevoss twins, celluloid ‘Men of Harvard,’ were the Establishment’s wet dream.”

— and the eventual investment in both Shrem’s now-defunct BitInstant and bitcoin (BTC) itself, leaving the twins with 1% of the crypto’s entire supply.

Charlie Shrem enters the stage

Shrem, at this point, has become a major, manic character in both the book and the twins’ life. The book describes their relationship as being on friendly grounds for the majority of their connection to each other, although each time Charlie is introduced, his adjectives become more childlike and a bit more dismissive, up to the point that he is sometimes alluded to as the CEO of his favorite nightclub rather than of BitInstant.

By the time that Shrem is jailed, which coincides with the New York State Department of Financial Services’ infamous cryptocurrency hearings with the now-hated Ben Lawsky (the anti-crypto-legislator-turned-entrepreneur who advises New York crypto firms on how to follow the confusing laws he himself created), the twins have written Shrem off as a bad investment.

It would be interesting to see how Shrem has reacted to his characterization here, but he’s left me unread on Telegram since November 2018, when I texted him for comments about the Winklevoss’ now-settled lawsuit against him for theft of 5,000 bitcoin around this same time (which, for some reason, was not covered in Mezrich’s book).

Roger Ver: The antihero

Bitcoin Jesus Roger Ver is brought in by Mezrich in the role of Charlie’s best friend, mentor and antithesis to the Winklevoss twins. The Winklevii hate him, Mezrich makes that abundantly clear — to the extent that they will never meet with him in-person throughout most of the book.

This seems to be a rather extreme reaction as investors in a common project that has a relatively incomptentant CEO that they both know well, but Mezrich paints over their strange inability to even have a normal business conversation with Ver by portraying this Jesus character as what your mom would call a “very bad influence that you shouldn’t play with.” And thus, the Winklevii will not play with him.

Taking Bitcoin mainstream

The move from the Winklevoss twins owning bitcoin to starting a cryptocurrency exchange is explained very quickly, but the point behind the idea has been hammered into the reader’s head the entire book: The Winklevoss twins really, truly love regulation. And what better way is there to ensure regulation in the crypto space than to create an exchange, base the business in New York (the state with the most stringent crypto laws) and then make sure people regulate it?

And this is what the Winklevii have done. They started Gemini Capital, received the BitLicense for Genesis Global Trading, and they were the first to get the SEC rolling on whether or not to accept a bitcoin exchange-traded fund.

Back to the book, up to almost the present day, the ending trails off with an almost-unidentified man (surprise! it’s Mark Zuckerberg!) penning a ridiculous letter in January 2018 about his marathoning, Mandarin skills and newfound interest in cryptocurrency.

But this book’s author could not have predicted that more than a year later, when the book came out, Zuckerberg’s over-the-top Christmas missive would lead to a media frenzy surrounding the Libra Association, libra stablecoin, Libra Investor Token, and the list goes on.

All of this makes the similar titles of Mezrich’s books a bittersweet joke, especially when juxtaposed with the scene in the book in which the Winklevii are pleased that crypto-focused New York Times journalist Nathaniel Popper doesn’t use the word “Facebook” in the headline of his second article about the twins and crypto. Zuckerberg has definitely caught up to them in the crypto space célébrité, even though his project has been met with a significant amount of scorn over its decentralization — or lack thereof.

And to add insult to injury — depending on your opinion of Zuckerberg’s pettiness (mine was amplified by a very early scene in the book wherein the Facebook mogul insisted on only meeting with one twin during a mediation due to an apparent fear of being punched) — libra stablecoin, gemini dollar… can anyone here read a horoscope?

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Ben Mezrich’s new book into the lives of the Winklevoss twins casts Mark Zuckerberg as the villian and the Winklevii as the heroes, but is it that simple?