Dec 27, 2018

Cryptocurrency dreams went bust in 2018

Illustration: Aïda Amer/Axios

This was the year that Bitcoin and most other blockchain currencies turned out to be the new tulip — a mania that led otherwise sensible people to suspend their better judgement and become poorer by piling in.

Be smart: Similar fads pop up every few years — always accompanied by the phrase, "this time is different," until it ends in tears.

  • That psychology has now changed decisively: Bitcoin’s price shot up to record prices artificially, only to plummet about 70% this year.
  • "[O]f 573 digital coins launched since 2017," according to The Wall Street Journal, "89% are trading at a loss compared with their offering price and worth a total of about $2.1 billion — $8.4 billion less than the $10.5 billion initially invested."

For cryptocurrencies, 2018 was the correction to 2017, which was basically a big free for all. Then, regulators and reality came calling.

  • Initial coin offerings (ICOs), it turns out, are not a magical and regulation-free fundraising mechanism: A bad white paper does not a viable digital token make.
  • "The SEC and state regulators have brought more than 90 crypto cases over the past two years," but have only managed to claw back about $36 million for duped investors, The Journal reports (subscription).
  • "One of the attractions of digital currency is its anonymity. That ... can also make it hard for investigators to trace funds."

Predictions for next year: more regulatory guidance, and more realistic applications of the tech.

  • Look for other uses of blockchain technology to flourish. One big possibility is supply chain — tracking goods from one point to another.
  • Commodity traders are also eyeing the technology in their quest for an edge.

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FBI to investigate death of black man after video shows officer kneeling on neck

A man protesting near the area where a Minneapolis Police Department officer allegedly killed George Floyd. Photo: Kerem Yucel/AFP via Getty Images

The FBI will investigate the death of a black man for possible civil rights violations after video emerged of a Minneapolis police officer kneeling on the man's neck for several minutes, ignoring protests that he couldn't breathe, the Minneapolis Star Tribune reports.

The big picture: The man, identified as George Floyd, was being arrested for alleged forgery and appeared to be under the influence of alcohol or drugs, according to a police press conference Monday night. Police say he resisted arrest before suffering from “medical distress."

Coronavirus dashboard

Illustration: Aïda Amer/Axios

  1. Global: Total confirmed cases as of 1 p.m. ET: 5,543,439 — Total deaths: 347,836 — Total recoveries — 2,266,394Map.
  2. U.S.: Total confirmed cases as of 1 p.m. ET: 1,669,040 — Total deaths: 98,426 — Total recoveries: 379,157 — Total tested: 14,604,942Map.
  3. Trump administration: Mike Pence's press secretary returns to work after beating coronavirus.
  4. States: New York reports lowest number of new coronavirus deaths since March.
  5. Public health: The final data for remdesivir is in and its benefits are rather limited.
  6. Education: A closer look at how colleges can reopenNotre Dame president says science alone "cannot provide the answer" to reopening.
  7. What should I do? Hydroxychloroquine questions answeredTraveling, asthma, dishes, disinfectants and being contagiousMasks, lending books and self-isolatingExercise, laundry, what counts as soap — Pets, moving and personal healthAnswers about the virus from Axios expertsWhat to know about social distancingHow to minimize your risk.
  8. Other resources: CDC on how to avoid the virus, what to do if you get it, the right mask to wear.

Subscribe to Mike Allen's Axios AM to follow our coronavirus coverage each morning from your inbox.

Updated 1 hour ago - Politics & Policy

Pentagon watchdog sidelined by Trump resigns

Fine testiying before the Senate Judiciary Committee in 2017. Photo: Drew Angerer/Getty Images

Glenn Fine, the Pentagon's principal deputy inspector general, submitted his resignation on Tuesday.

Why it matters: President Trump removed Fine as the Pentagon's acting inspector general in April 7 after a group of independent federal watchdogs selected him to lead the Pandemic Response Accountability Committee, which was set up to oversee the rollout of the $2 trillion coronavirus relief bill.