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Crypto News Updates

Bitcoin Just Below All Time High: Analysts Indicate Room To Grow

On March 11th, Bitcoin reached $57k, just below its all-time high, after falling to a low of $43k in February. Today, the coin hit $62,000. With Bitcoin managing to regain the lost ground in such a short period of time, analysts remain bullish on the future of the asset’s price.

While after the initial 2017 crash, Bitcoin regained much of its price loss quickly – only to lose more than 80% of its value in the weeks later – there is reason to believe that this time is different.

Bitcoin On-Chain Analysis 

Bitcoin analyst Willy Woo believes that the 5% of total supply bought above $53k (at a one trillion market valuation) is a strong indicator for the bullish sentiment of retail and institutional traders. 

Investors were clearly not panicked by the dip and took the opportunity to accumulate another ~900,000 BTC. 

The analyst also points to 35% of the total supply that has been bought in the past three months. This suggests that the market believes BTC is still, at the very least, an undervalued asset – or an alternative to the currently volatile equities market.

Technicals Indicate There is Room to Grow

In terms of technical indicators, according to Central Charts analysis, BTC has broken through its horizontal resistance on the weekly timeframe – another bullish signal. Bitcoin has also experienced a price channel breakout, a move that is typically followed by a dramatic appreciation in the assets market value. 

While not a guaranteed movement, these two technical indicators used in conjunction with the rapidly diminishing supply of BTC taken at current price levels shows that there is reason to be optimistic about the coins price.  

 

Bitcoin price movement in the past week has also been making waves due to it significantly outperforming the QQQ NASDAQ technology index over this time period, with the QQQ down 1.72% compared to Bitcoin increasing 15% from March 1st to March 11th. 

Bitcoin has usually been at least somewhat correlated to the movements of the US tech equities market, however with rising fears of increased inflation – money has fled out of traditional tech and into other assets like Bitcoin. 

Should this trend continue, Bitcoin will continue to become seen as a store of value against inflation and other macroeconomic threats.

Source: Bitcoinist News

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Crypto News Updates

Kraken CEO on Bitcoin: “It’s Going to Infinity”

In an interview with Bloomberg, Kraken CEO and founder Jesse Powell gave a perplexing prediction of Bitcoin’s future value: “When you measure it in terms of dollars, you have to think it’s going to infinity.”

Powell was quick to justify his comment by painting a future where instead of comparing Bitcoin to fiat currencies in order to determine the value of an item, prices are considered solely in Bitcoin:

I think pretty soon people are gonna start measuring the price of things in term of Bitcoin. I think the true believers will tell you that it’s going all the way to the moon, to Mars, and eventually will be the world’s currency. So we won’t be measuring the price of Bitcoin in terms of dollars, but what else you’re going to be buying with it – probably planets or other solar systems.

Certainly optimistic by most standards, Powell painted a picture of a post-fiat world, where items are valued in Bitcoin rather than government-backed currencies. 

[Bitcoins could be worth] whatever the market cap of the dollar is, the euro, all of that combined.

When pressured to give a numeric answer to Bitcoin’s future price, Powell suggested that a price target of $1 million over the next 10 years would be “reasonable”. Powell suggested that Bitcoin’s increased in price is tied to the inflation of the US dollar, as people see Bitcoin as a “safe haven asset” in the face of unreliable returns on savings accounts. Powell also spoke on Kraken’s upcoming round of investment, touching on Kraken’s valuation of $10 billion dollars, and the potential of Kraken going public in the future:

We’re certainly on track to go public, we’ve had a lot of inbound interest in financing, in people buying shares in the company. Personally, I think $10 billion dollars is a low valuation – I wouldn’t be interested in selling shares at that price.

Ending off the interview, Powell expressed sentiments that seemingly concur with the recent attitude of cryptocurrency enthusiasts: 

I’m a long term holder. There’s no reason to sell Bitcoin, and I think a lot of other people are just waiting to buy the dip, these ‘hodlers of last resort’.

There are a lot of weak hands out there, they come in, they day trade, they don’t really understand the fundamentals of Bitcoin, but I think there are enough people out there see that Bitcoin is the future and are holding long term.

Source: Bitcoinist News

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Crypto News Updates

Curve (CRV) Up 30%: A Still Undervalued DeFi Project?

Curve Finance’s governance token CRV (not to be confused with CURV – recently acquired by Paypal) token has shot up to $2.46 on March 2nd from its monthly low of $1.80.

Even with this recent jump, there is much evidence pointing to CurveDAO still having room to increase. 

First, what is Curve?

Curve describes itself as a place to “exchange stablecoins (DAI to USDC for example) through it with low fees and low slippage.” But instead of peer-to-peer transactions, it uses liquidity pools to achieve this. 

DeFi Integrations

The stablecoin token pools in Curve, of course, generate revenue from more than just platform fees. The tokens (such as DAI/USDC) in the pools are lent to practically all other major interest-paying DeFi protocols such as AAVE, UniSwap, and recently Synthetix.

In this regard, Curve serves as the backbone of DeFi infrastructure. Other than these protocols, Yearn Finance, Badger, SushiSwap, Pickle…etc. Rely on Curve’s stablecoin pools. 

Another of Curve’s competitive advantages is its ability to handle cross-asset swaps up to 100m in a single transaction with no slippage. Cross asset currency swaps are an OTC derivative in TradFi, but Curve eliminates this need completely.

This function also provides resilience against Binance Smart Chain products – as a performer of an eight-figure swap can easily absorb high ETH gas fees for zero slippage.

Volume of Transactions

Volume on Curve, a driver of fees and APY adds further to its undervalued status.

According to CoinGecko, In the past 24 hours, Curve has more than double the trading volume of AAVE – a DEX with almost 10x the market cap. And its most traded pair DAI/USDC has 54M in volume compared to AAVE’s AUSDC/ETH $49M. Ranking 7th on the list of total volume, it appears that the market does not price this into its value – a realizable opportunity for savvy investors.

“veCurve” yield

One final reason Curve may appreciate is simply the yield offered for holding its governance token compared to other protocols. The metrics now are:

  • veCRV holder APY: 15.58%
  • AAVE holder APY: 6.22% 
  • xSushi holder APY: 7.285%

 From these (24hr) numbers, it is clear that Curve is able to offer better alpha. And veCRV has typically surpassed these other two major protocols in yield, indicating it may be a more attractive hold than other yield-bearing DeFi assets.

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Source: Bitcoinist News

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Why The Bitcoin Price Recently Found Support At $46K

After plummeting from $46k to $43k on Sunday, Bitcoin managed to hold onto the critical support level of $46,000.

Breaking Down Bitcoin’s Price Action

Down 20% from its all-time high reached earlier this month, Bitcoin finds itself in correction territory – a sharp change from the almost uninterrupted year-long bull run.

With a relative strength index (RSI) of 45, Bitcoin looks to be oversold – a signal that it certainly has more upside potential in the short term. 

The commodity channel index (CCI), another short-term valuation metric that can be used in conjunction with the RSI, points at Bitcoin emerging from the heavily oversold territory at $43k and moving at the start of a new uptrend.

BTC continues to touch the lower bound of its Bollinger Bands on the daily time period, a strong bullish signal indicating the asset is heavily oversold. However, the previous candle closed over the Bollinger band on the weekly timeframe – interpreted as a neutral or slightly bearish signal for Bitcoin.

Just below its weekly pivot point of $46.2K, Bitcoin potentially appears to be on the verge of a breakout, and investors should watch the price action of Bitcoin closely if it is able to recapture this price level. Another crucial pivot point to watch out for is $52K. If Bitcoin manages to breach this, another price surge would likely occur. 

On a fundamental level, analysts and investors are concerned with a repeat of the 2018 major correction – but there is significant reason to believe this is relatively unlikely. Philip Swift, a cryptocurrency analyst, has pointed out that:

Spent Output Profit Ratio (SOPR) has now reset (green on the chart) meaning that wallets selling are now selling at a loss. This is a strong ‘buy the dip’ signal in a bull market.  This alongside derivative fundings having reset is bullish.

Any asset pulling back from all-time highs are expected within a short time period in such a heated market – the 2017 rally was marked with pullbacks to price levels of %15-25 before breaking through the $20,000 barrier.

With the fundamentals of Bitcoin vastly improved in terms of mainstream adoption and institutional use, analysts are optimistic that this recent pullback will not last long. As the technical indicators on a weekly and daily basis point to it being oversold, now may be an essential time for traders to consider the considerable upside of the asset. 

But high volatility in the market caused by political decisions such as in Nigeria and the Federal Reserve’s comments could lead to Bitcoin diverging with its technical indicators and dropping to even lower support levels. 

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Source: Bitcoinist News

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Ethereum DeFi Trends Set To Dominate 2021

2020 was the year of DeFi, not just in terms of the explosive price increases – but the technological advances and support from public figures.

From the growth of UniSwap, Chainlink, AAVE, and BNB into the top 20 tokens by market cap to tech billionaire Mark Cuban revealing his positions in the aforementioned tokens, one must wonder what comes next. 

Improved security and auditing of contracts. 

Exploits performed by hackers on vulnerable DeFi smart contracts resulted in the loss of tens of millions of funds throughout 2020 and early 2021.

Flash loan attacks, where hackers can borrow large uncollateralized quantities of ETH and extract funds from exchange through complex arbitrage opportunities between stablecoins or manipulation of price oracles (the price providing part of a smart contract that interacts with market data outside the chain).

Auditing smart contracts before they go live as part of yield farming or lending strategies by third-party firms such as Nexus Mutual is necessary – and becoming the accepted norm for DeFi platforms. Users becoming acquainted with the basics of DeFi development processes and community-led initiatives to ensure complete auditing of contracts are also vital to its long-term resiliency.  

ETH 2.0

DeFi has grown from the Ethereum ecosystem but has reached a point where it is almost impossible to continue in the current Ethereum paradigm. ETH 2.0 promises lower fees – lending itself to the higher scalability that is needed for the financial products of the future. But more than lower fees, ETH 2.0 will hopefully address the first point raised.

As a proof-of-stake chain, Ethereum miners will be unable to modify blocks that have already been validated – ensuring the robustness needed for a secure financial ecosystem. Projects like Binance token (BNB) and Cardano (ADA) plan to capture the DeFi market through their blockchains, but with the overwhelming majority of initial development done on Ethereum, ETH 2.0 would likely place the chain in a dominant position over DeFi. 

Regulatory Pressures

Regulatory focus on crypto has primarily been placed on tax evasion and other fraudulent activity. DeFi. The regulatory framework for DeFi by the governments of the US, China, Russia is nearly non-existent.

Minimizing exit scams, implementing KYC on DEXs (decentralized-exchanges), and preventing money laundering remain pressing concerns.

Overbearing regulation, including policy, targeted explicitly at obstructing DeFi is a critical macro risk that users and project CEOs must be aware of and account for. Government Policy could ultimately end up much favoring centralized exchanges such as Coinbase – which filed to go public on the 25th. 

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Source: Bitcoinist News

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Breaking Down Square’s Bitcoin (BTC) Position

The recent push to the $1 trillion bitcoin market cap can at least be partially attributed to institutional investors; firms investing on the behalf of others or as part of their asset allocation strategies.

Square, One of the Largest Corporate Holders of Bitcoin

Alongside MicroStrategy, now Tesla, Square is one of the largest institutional purchasers of the asset. However, unlike these other two companies – Square purchases bitcoin to provide it to its users directly through its app. A potential signal on the strong retail interest behind bitcoin, a driving force behind Bitcoin’s rally to $57K.

The CEO of Square, the publicly traded financial payments company, aiming to disrupt traditional finance, Jack Dorsey, is a staunch supporter of bitcoin. 

Square believes that cryptocurrency is an instrument of economic empowerment and provides a way for the world to participate in a global monetary system, which aligns with the company’s purpose”

In January, one million users bought bitcoin for the first time last month through Square’s Cash App, with 24 million monthly users on Cash App, this is still a 23 million user untapped source of investors for Bitcoin.

Possibly to capitalize upon this and expand its Bitcoin revenues, in its fourth quarter release  Square announced another $170 million purchase of BTC.

Square is estimated to have paid $51,000 per BTC  based on its timing in Q4. Bitcoin is currently at $44,800 at the time of writing, meaning that their position is down ~12% since the time of purchase. However, Jack Dorsey and the Square leadership indicate no signs of wanting to sell their large position, which offers both a message of hope and possible concern for the average retail investor.  Square, as a public company, is first obligated to its shareholders – and if leadership came under pressure from its other institutional shareholders to sell the asset if it declined dramatically in price due to volatility, this event may cause a weakening in the market and trigger a further sell-off.

But if shareholders and leadership are more optimistic about the asset’s price, it may buy other Bitcoin with its reserve capital to DCA (dollar cost average) into its position, increasing demand and pushing the price up.

A significant concern with institutional purchasing, such as with Square, is that it defeats the purpose of Bitcoin’s inherent decentralized nature by concentrating tokens into centralized financial organizations. But for the mass adoption needed to truly cement BTC as a store of value, acquisitions such as these done by Square are helpful and frankly necessary.

Bitcoin investors should keep a careful watch on the future purchases of Square and the value of its total holdings to gauge possible market action.

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Source: Bitcoinist News

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Cardano Reaches All-Time High, Ahead of Ethereum in Transaction Volume

Today has been a monumental day for Cardano. Caught within the recent crypto bull market, its token, ADA, hit a new all-time high price of $1.38 this evening. This marks an increase of approximately 2600% over the past year, as tracked by Messari

In fact, this milestone brings with it more good news for the smart contract platform. Over the past 24 hours, the surge of interest in Cardano has brought its on-chain transaction volume to $19.8 Billion, soaring past Ethereum’s $13.2 billion and second only to Bitcoin at $27.2 billion. 

All this activity has brought ADA’s market cap has exceeded both BNB and USDT to the third highest in the market, behind Bitcoin and Ethereum.

Initially released in 2017, Cardano was created by Ethereum Co-Founder Charles Hoskinson, through his company Input Output Hong Kong (IOHK) and the Cardano Foundation. Although he had previously expressed apathy towards the value of ADA, Hoskinson appears to be celebrating Cardano’s achievements on Twitter:

Cardano as a Smart Contract Platform

Cardano’s recent success comes as a surprise given its lack of major projects utilizing the blockchain. Although it has surpassed Ethereum in terms of transaction volume, Ethereum remains far more popular with regard to blockchain-based applications. This raises the question, will Cardano be able to maintain this success without dApps to legitimize it as a platform for developers?

However, Cardano’s lack of major applications may eventually change due to the publicity of ADA’s recent bull run. Cardano’s previous lack of volume may have acted as a deterrent to developers looking for a platform for their application, ultimately attracted by the ensured popularity of the Ethereum network. 

Alternatively, a developer might also consider the EVM-compatible Binance Smart Chain (BSC), which has found recent success in the realm of smart contracts. BSC remains noteworthy due to its popularity with recent larger applications despite a far lower market cap than Cardano.

This incredible surge of price may act as a resolution to the “chicken and the egg” scenario of lacking dApps due to lower volume and popularity, and lacking volume and popularity due to the lack of major dApps on the Cardano network. This bull market may very well put not only ADA’s future value in question, but Cardano’s future usage as a smart contract platform.

At the timing of writing, ADA remains just beneath its ATH and is holding steady, up 34% over the past 24 hours. Transaction volume continues to grow as ADA shows no signs of backing down.

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Source: Bitcoinist News

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Explaining Binance Coin’s (BNB) Surge Past DOT, XRP, and Litecoin

Binance’s BNB token has surged more than 860% in the past month to attain the position of fourth-largest cryptocurrency by market cap. 

Binance Coin’s Rise to Prominence

BNB has historically been offered by Binance as a utility token for discounted trading fees on their platform. However, with the release of Binance Smart Chain in September 2020, it has become a serious potential competitor with Ethereum in the DeFi space. 

PancakeSwap and Venus, both decentralized exchanges operating on the Binance smart chain, have rapidly increased their total value locked to $3.4B and $3.9B according to Defistation, respectively. In comparison, the far more established UniSwap and Aave stand at $4.4B and $3.4B, respectively.

The TVL on Binance Smart Chain illustrates a truly telling picture of which ecosystems users want to participate in, with almost the entirety of PancakeSwap’s and Venus’s capital entering in the past four months compared to Aave and UniSwap’s two+ years of operation in the space. 

From a development perspective, Binance Smart Chain is easily integrable with Ethereum projects (being a 100% EVM compatible blockchain). Thus, there is continued potential for ERC-20 based yield farming strategies to be easily implemented on BSC. 

With such a rapid increase in price for the token, many investors are skeptical of the token’s future price prospects. But the longer the Ethereum gas fees stay prohibitively high for the average user to perform swaps and farming, the more capital will flow from the Ethereum DeFi ecosystem to the Binance ecosystem – putting immense upward pressure on the price of BNB token.

BNB’s ~$0.20 fees for performing swaps on Pancake is far lower than the near-$50 needed for swaps and providing liquidity on UniSwap. BNB’s 40 billion vs. Ethereum’s 1$88 billion market cap may indicate that Binance’s token has much to still appreciate in price given that it achieves its goal of becoming a more viable alternative to Ethereum. 

Watch Out for Ethereum

However, BNB investors should be cautious of the developments of ETH 2.0, with much lower gas fees and less network congestion promised on the Ethereum website roadmap.

If ETH 2.0 is able to deliver on this promptly, Binance Coin could likely see a massive short-term decline in price in reaction, as ETH is still far more ingrained within the DeFi space both from a technical perspective and public knowledge.

The more centralized nature of BNB is also a possible cause for concern for the token, with Binance holding the majority of Binance tokens according to crypto data providers – and subsequently controlling the majority of the 21 validator nodes.

If government legislation or financial enforcement were to target Binance directly, Binance’s native token would likely decline from this month’s highs to multi-year lows seen in 2018.

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Source: Bitcoinist News