A small but significant percentage of the clients of US bank Goldman Sachs say that Bitcoin would cross the six-figure mark in the coming years, the bank said in a report released Thursday.
Why Goldman clients like Bitcoin
From the 280 respondents of a survey titled “GS Digital Assets Client Survey,” the bank found that over 22% of its client felt Bitcoin would cross the $100,000 mark in the next 12 months while a majority (54%) said it would trade between the $40,000-$100,000 level.
42% of the respondents were invested in Bitcoin while 29% held Ethereum. 16% said they held ‘other’ altcoins, and the remaining were exposed to stablecoins.
40% of all respondents, in addition, said they were exposed to the crypto market, mainly via derivatives, and just 41% of those respondents via “spot” holdings, while 61% said they felt their crypto holdings would rise in the next 12-24 months.
In terms of the investment thesis, 28% of all respondents said the global macro backdrop led to the recent run of Bitcoin while an overwhelming 57% said that institutional adoption and Bitcoin products were the cause, as they led to greater trust in the asset.
Move comes as desk launched
Goldman has, so far, largely maintained its distance from Bitcoin and other cryptocurrencies. Last year, the bank’s former CEO, Lloyd Blankfein, stated that the asset was a highly risky bet and that he would be hyperventilating” at the recent ‘success of Bitcoin.’
But the bank’s opinion seems to have changed with high Bitcoin prices. Goldman (re)started its trading desk last week for institutional clients citing “high demand”—two years after initially offering and quickly closing down the service in 2018.
The desk would trade Bitcoin futures and non-deliverable forwards for clients from next week, a person familiar with the matter said earlier this week, adding that Goldman was also exploring the potential for a Bitcoin exchange-traded fund (ETF).
It’s not like the road ahead is fully clear for Bitcoin, however. 34% of the survey takers feared government regulations and mandates are the biggest “obstacles” to Bitcoin’s growth, while 24% said that the lack of a well-regulated, accessible, and investible instrument would be the greatest hurdle for Bitcoin in the coming months.
Saylor isn’t alone either. Though Microstrategy has been a catalyst for institutional investment, many companies, including Tesla, have begun to add BTC to their balance sheet. Some even regret not having bought it earlier. This week, legendary investor Jim Rogers said that he “wished” he had bought BTC.
This brings the total Bitcoin holdings of MicroStrategy to an astronomical $2.2 billion. The company now holds over 90,000 BTC, purchased at an average price of $24,119.
Disclosure: The author held BTC at the time of press.
The software company added another $10 million in BTC to its war chest.
MicroStrategy, a software company that’s been making headlines for its aggressive Bitcoin purchases, has made another $10 million purchase after Thursday’s market uncertainty.
As announced by CEO Michael Saylor, the company purchased another 205 BTC at an average price of $48,888, spending $10 million in cash to do so. This puts the company’s total Bitcoin holdings at 91,064 BTC worth $4.3 billion. The total cost basis of the BTC is $2,196 billion with an average purchase price of $24,119.
MicroStrategy’s latest Bitcoin purchase is one of its many “symbolic” buys where the company puts a few more million in BTC after every dip. While the software company began putting its existing assets into BTC in 2020, back when Bitcoin traded around $10,000, its latest purchases have yet to break even.
The latest major purchase, funded by a bond offering of $900 million, was done at an average price of $52,700 per BTC. Bitcoin’s price has wavered ever since amid a worsening outlook for risk assets on Wall Street.
Thursday’s buy coincided with a period of heightened tension on markets, as Fed chair Jerome Powell signaled that bankers do not think current conditions require additional intervention. Bond yields have been on a steady and powerful rise in the past weeks, which traditionally signals recovery from a recession and heightened inflation expectations. This should normally reflect well on stocks and risk assets, but the narrative behind 2020’s unstoppable rise strongly relied on low bond yields and continuous Fed intervention as justification for heightened valuations.
Wall Street tension seems to be having some effect on Bitcoin, though MicroStrategy seems keen to continue on its previous path. Thursday’s purchase is largely symbolic, but the more important indicator is that MicroStrategy did not sell, despite its stock price having fallen 50% since February highs.
MicroStrategy has bought $10 million worth of additional Bitcoin today at $48,888 per piece. The software giant has been at the forefront of institutional Bitcoin purchase, having already bought over $2.196 billion in total Bitcoin purchase. The institutional giant now holds a total of 91,064 bitcoin in its treasury.
MicroStrategy has purchased an additional ~205 bitcoins for ~$10.0 million in cash at an average price of ~$48,888 per #bitcoin. As of 3/5/2021, we #hodl ~91,064 bitcoins acquired for ~$2.196 billion at an average price of ~$24,119 per bitcoin. $MSTRhttps://t.co/a0BRd4Wy3r
MicroStrategy was among the first fortune 500 companies to see the potential in Bitcoin as the treasury hedging asset amid the diminishing value of the US Dollar in the international trade market. The software giant started purchasing Bitcoin back in August 2020 when the top cryptocurrency was trading around $13,000 and since then it hasn’t stopped.
Apart from direct cash purchases from its treasury, the software solution provider has also raised nearly $1.65 billion in debt security by offering the company’s convertible notes. The firm first sold nearly $650 million worth of debt security in December last year and only last month it raised another billion-dollar through the issuance of convertible notes. Despite many experts warning against buying Bitcoin via credit, MicroStrategy CEO Michael Saylor has revealed that the company intends to raise more capital via the same method for buying Bitcoin.
On Friday (March 5), Michael J. Saylor, Co-Founder, Chairman, and CEO of Nasdaq-listed business intelligence company MicroStrategy Inc. (NASDAQ: MSTR) announced yet another BTC purchase. Just four days ago, Saylor announced that his company had “purchased an additional ~328 bitcoins for ~$15.0 million in cash at an average price of ~$45,710 per bitcoin.” Well, today, Saylor was back to […]
PAID Network has entered into a strategic partnership with Evolution Finance, a portal for DeFi exposure and lending channels. The integration will pave the way for the inclusion of Evolution Finance’s revolutionary lending services into Ignition, a highly-acclaimed IDO Platform designed by PAID Network for users. The collaboration will open new doors of lending and …
Bitcoin mining firms, even the newly-established ones, seem to be increasingly pursuing public listings.
Cipher Mining Technologies Inc. a subsidiary of blockchain development firm Bitfury has inked a $2 billion merger deal with Nasdaq-listed Good Works Acquisition Corp — a special purpose acquisition company, or SPAC. Both companies have entered into a business combination agreement.
According to a press release issued on Friday the merger will see Bitfury’s U.S. Bitcoin (BTC) mining enterprise become a publicly-listed company under the banner Cipher Mining Inc.
In addition to the combined $2 billion valuation for Cipher, investors like Morgan Stanley-backed Counterpoint Group and Fidelity Management and Research company will also lead a $425 million funding round.
This additional cash influx will proceed via a private investment in public equity, or PIPE, funding round. Bitfury will also provide a $50 million investment-in-kind to add to the $170 million left over from the October 2020 Good Works initial public offering, thus setting the combined company’s gross cash holdings at $595 million.
Commenting on the merger, Cipher Mining CEO Tyler Page remarked that the deal was a significant step in the emergence of properly capitalized Bitcoin mining enterprises, adding:
“With this transaction, we will be able to combine the formidable skill sets and technologies developed by Bitfury Group over the past 10 years with what we believe will be a leadership position on the global cost curve, and thereby create a true leader in the Bitcoin mining industry.”
With the merger expected to close in Q2 2021, Cipher is looking to achieve a 745 megawatts mining capacity by end of 2025. The company says it hopes to cross the 445 MW milestone between the end of 2021 and Q2 2022.
Cipher is the latest Bitcoin mining establishment to pursue a public listing albeit via a merger with a SPAC entity. As previously reported by Cointelegraph, Australian green energy Bitcoin mining outfit Iris Energy is set for a $39 million IPO in the summer.
With designs towards 745 MW in mining capacity, Cipher is also the latest example of the expanding Bitcoin mining outlay in North America. While China still dominates the BTC hash rate distribution, firms in the U.S. and Canada are reportedly increasing their inventory in the quest to dilute China’s control of the Bitcoin mining arena.
Yearn Finance and Cover Protocol have parted ways, according to an announcement made earlier today. Yearn Finance announced the end of the merger process between the two, clarifying that yVault depositors who have already purchased Cover protection would be unaffected by this. The aforementioned merger was initially announced in November 2020, with Cover intended to […]
Disclaimer: The findings of the following analysis are the sole opinions of the writer and should not be taken as investment advice The cryptocurrency market has seen major corrections lately. In fact, Bitcoin itself has oscillated violently between $45k and $49k for most of the last 7 days. This resulted in the market’s altcoins mirroring the […]
With recent months bringing a surge in interest in bitcoin (BTC) among individual investors, a rising share of newcomers represent so-called 'weak hands' that might sell their crypto during the first serious price correction, according to a report by market research platform Cardify.
The share of deposits from new users almost tripled between last November and February
Ripple’s CEO Brad Garlinghouse told Reuters in an interview today that the company is still conducting and growing its business in the Asia Pacific region despite the SEC legal case against Ripple and its executives.
The last four months have been some of the toughest for Ripple after the company was slammed with a $1.3 billion lawsuit by the United States Security and Exchange Commission (SEC). The regulator alleged that Ripple and its executives, including Garlinghouse, conducted an unregistered securities offering using XRP.
News of the lawsuit spurred panic, and some major crypto exchanges offering services to U.S. clients were quick to delist XRP from their platforms. Ripple’s partner Moneygram also pulled the brakes on its alliance with the company following the SEC fiasco.
The price of XRP suffered severely, and the once-third-largest cryptocurrency by market cap now ranks seventh on CoinMarketCap.
No Fallout In Asia
Despite the company’s mishap in the United States, Garlinghouse noted that Ripple has continued its operation without hassle across Asia, especially Japan, thanks to the regulatory clarity in the region.
“It (the lawsuit) has hindered activity in the United States, but it has not really impacted what’s going on for us in Asia Pacific. We have been able to continue to grow the business in Asia and Japan because we’ve had regulatory clarity in those markets,” Ripple’s CEO said during the interview.
Garlinghouse believes the lack of a clear regulatory framework for cryptocurrencies in the United States is a hindrance to innovation and the SEC lawsuit is an attack on all crypto. However, he said that Ripple will not let the regulator bully the industry.
An Attack On All
The CEO, alongside Ripple’s co-founder Chris Larsen, recently filed two separate motions, calling for the dismissal of the lawsuit against them and the company.
Garlinghouse described the SEC action as a “regulatory overreach.” Ripple and its executive want US regulators to treat XRP as a virtual currency just like Bitcoin and Ether, but the SEC continues to insist that it is a security.
Bitcoin prices extended losses on Friday as the US dollar gained alongside the long-term Treasury yields.
Downside pressure on cryptocurrency remains amid expectations of modest job growth in the US.
The technical support offered by the 20-period moving average on the four-hour chart maintains Bitcoin’s medium-term bullish outlook.
Bitcoin dropped Friday, suggesting that the benchmark cryptocurrency may decline further into the week, followed by an equally depressive weekend session in the wake of the rising US dollar and a recent spike in the US Treasury yields.
Bitcoin Short-Term Targets
The spot BTC/USD exchange rate plunged 2.43 percent into the daily session. On the other hand, the pair was trading in a positive area on a week-to-date basis, up more than 4.5 percent ahead of the weekend session. The price action was choppy nonetheless, giving no clues about its direction in the coming sessions ahead.
Technically, Bitcoin appeared trapped inside a range defined by two of its crucial moving averages. In doing so, the cryptocurrency tested the 50-period moving average as resistance and the 200-period moving average as support.
A bounce from the 200-MA on Friday pushed BTC/USD towards 50-MA for a bullish breakout attempt. Nevertheless, higher selling pressure near the latter wave kept prices from flourishing upward. That showed traders’ resilience, which may have to do with unfavorable macroeconomic climate.
Jobs Data, Bond Yields, US Dollar
Traders limited their bids near the local BTC/USD tops as Bitcoin formed a positive correction with the US stock market against the prospect of rising US Treasury yields. Both the markets tumbled last week as a bond market sell-off raised questions about whether low-interest rates, which propelled both Bitcoin and US equities last year, can continue for any longer.
Yields, which rise as bond fall, have rallied as a response to expectations of faster US economic growth, led by a speedier vaccination program and inflation expectations.
That marked the highest close for the benchmark borrowing cost since February last year. Its climb on Thursday came as Federal Reserve Jerome Powell provided no signs that the central bank would intervene to limit the ongoing sell-off in the US government debt market.
The US dollar benefited from the global market uncertainty, with its value against a basket of foreign currencies—known as the US dollar index—rising by 0.75 percent on Thursday. The index surged 0.31 percent on Friday.
More tailwinds for the US dollar growth came from early estimations that the US labor market would log recovery in February.
“As we reopen the economy, inch-by-inch, that will unleash consumer spending and drive job growth, especially industries that have been most severely affected by the pandemic,” said Nela Richardson, a Ph.D. economist at human-resources software firm Automatic Data Processing Inc.
Bitcoin price started a fresh decrease below the USD 49,000 and USD 48,000 levels. BTC tested the USD 46,200 support and it is currently (12:30 PM UTC) attempting a fresh increase. To move into a positive zone, the price must settle above USD 48,000 and USD 48,500.
Besides, most major altcoins are showing bearish signs. ETH is struggling to recover above USD 1,500 and it remains at a risk of a
Ripple CEO Brad Garlinghouse, and executive chairman Chris Larsen plan to request the U.S. Securities and Exchange Commission’s charges against them be dismissed.
Each executive and their respective legal teams submitted separate letters to Judge Analisa Torres, who is presiding over the case, to outline the reasons they plan to file for motions to dismiss.
The SEC filed its lawsuit against Ripple in late December, declaring that XRP is a security and accusing the San Francisco payments company of selling the crypto asset without proper authorization.
The regulatory agency also filed suit against Garlinghouse and Larsen, claiming the executives played significant roles in negotiating and approving Ripple’s institutional sales. The SEC also says they adjusted sales targets depending on the price of XRP.
Garlinghouse’s lawyers say the SEC’s case represents “regulatory overreach, plain and simple.” The lawyers argue that XRP exhibits none of the traditional characteristics of an investment contract, and they note that the Department of Justice and the Department of Treasury’s Financial Crimes Enforcement Network (FinCEN) classified XRP to be a “virtual currency.”
They note that such a classification has required Ripple to continually adhere to anti-money laundering regulations that generally don’t apply to securities.
The lawyers also argue it’s inappropriate to charge Garlinghouse personally.
Larsen’s lawyers say there’s no basis for labeling XRP as a security, and argue the SEC has not shown any of Larsen’s XRP sales happened in the US.
“The SEC also fails to allege that Mr. Larsen’s XRP transactions were domestic and therefore within its jurisdiction…
Larsen’s XRP was offered and sold through a foreign market maker that sold his XRP ‘on digital asset trading platforms with worldwide operations and customers.’ And to the extent any part of the transactions occurred domestically, they still fall outside the SEC’s jurisdiction because they were ‘predominantly foreign.'”
Disclaimer: Opinions expressed at The Daily Hodl are not investment advice. Investors should do their due diligence before making any high-risk investments in Bitcoin, cryptocurrency or digital assets. Please be advised that your transfers and trades are at your own risk, and any loses you may incur are your responsibility. The Daily Hodl does not recommend the buying or selling of any cryptocurrencies or digital assets, nor is The Daily Hodl an investment advisor. Please note that The Daily Hodl participates in affiliate marketing.
SCB 10X, the venture arm of Thailand's oldest bank, is participating in an $80 million Series C fundraising round for institutional crypto custodian and digital asset platform Anchorage.
Just last month, SCB 10X — the venture arm of Siam Commercial Bank — had announced its new $50 million fund dedicated to investments in global blockchain, decentralized finance and digital asset startups. The banking institution is Thailand's oldest bank, established by royal charter back in 1907, and its latest forays into blockchain via SCB 10X are already underway.
According to a report on March 5, SCB 10X is a contributor to the recent $80 million Series C raised by Anchorage, a crypto custodian and digital asset platform that received the United States' first federal digital asset banking charter at the start of this year.
The Series C was led by GIC, Singapore’s sovereign wealth fund, with investments from a16z, Blockchain Capital, Lux Capital and Indico Capital. The report of SCB 10X's involvement does not reveal the amount contributed by the fund, although its chief venture and investment officer, Mukaya Panich, has given some clue as to the significance of SCB 10X's choice of Anchorage:
"We [...] look forward to bringing Anchorage’s world-class cryptocustody solutions to Siam Commercial Bank’s customer base who are interested in having exposure to digital assets, and other potential users in Southeast Asia.”
In terms of broader cryptocurrency developments in Thailand, this week notably saw the country's Securities and Exchange Commission backtrack on a previous, controversial plan to enact a 1 million baht (roughly $33,000) minimum annual income requirement for crypto investment in the domestic market.
The blockchain and cryptocurrency markets continue to captivate Western media as renowned investors and entrepreneurs place their bets on the burgeoning space. However, while big names such as Mark Cuban and Elon Musk might drive billions of dollars in investments, it is the Asian markets that show the greatest signs of growth. Research shows that […]
Bybit will stop serving customers from U.K.-based IP addresses starting March 31, following the FCA's ban on all cryptocurrency derivatives trading.
Singapore-based cryptocurrency derivatives exchange Bybit announced on Friday that it would be suspending services for its customers n the United Kingdom. Bybit offers a range of high-end trading products for cryptocurrencies such as Bitcoin (BTC), Ether (ETH), Bitcoin Cash (BCH), Litecoin (LTC) and more.
The move follows a blanket ban on all retail cryptocurrency derivatives trading by the Financial Conduct Authority, and U.K. customers will be given until March 31 to close out positions and withdraw their funds from the platform, a company announcement stated.
The post also affirmed the company’s intention to continue dialogue with regulators in the hope of opening up shop in the U.K. once more.
“We request your immediate cooperation in this matter. We regret this situation, and will seek dialogue with regulators to explore options. We hope to be able to earn the privilege to serve you again in the future," stated the announcement.
Going forward, new sign-ups to the exchange using U.K.-based mobile phone numbers or IP addresses will be rejected automatically.
In October 2020, the FCA issued an announcement declaring that all retail cryptocurrency derivatives trading, encompassing products such as options, futures and exchange-traded notes, would be banned. The ban went into effect in early January 2021.
Remarkably, the FCA’s decision to ban these products flew in the face of feedback received from industry consultants. The FCA canvassed the opinions of trade bodies, national authorities, exchanges and legal representatives, with 97% of respondents arguing against the prospect of a ban.
The Taraxa Foundation, a non-profit body supervising research and development of the Taraxa project, announced a public sale kicking off on March 4 at 6 PM PST. The token sale follows the launch of Taraxa’s public testnet and the release of a flagship application, with the main purpose of distributing TARA tokens to community members […]
YIELD App, the DeFi wealth management platform bridging traditional and digital finance, is pleased to announce the launch of its Ethereum fund, allowing users to earn high-interest returns on their Ether (ETH). Following a successful public launch and token listing (YLD), YIELD App can now offer its users up to 20% APY on their ETH […]
Miners are making bank amid the price rally as manufacturers struggle to produce chips.
After a tumultuous 2020 that continued into Bitcoin (BTC) setting new all-time highs in 2021, Bitcoin miners are facing a bittersweet scenario — profits have skyrocketed, but multiple issues prevent them from buying more devices and boosting Bitcoin’s hash rate.
According to the founder of major mining pool BTC.Top, Jiang Zhuoer, global electronics supply chain issues are having their effect on the mining industry as well. Speaking with Cointelegraph, he said:
“There is definitely a shortage of equipment right now because, since the coronavirus epidemic, the global supply chain has been interrupted and is now in the process of gradually recovering. But the demand for chips has greatly increased, so now all industries are short of chips, whether it is Bitcoin mining or other industries, such as consumer electronics or even the automotive industry.”
Recently, car manufacturing giant General Motors shut down some of its plants due to the inability to source chips. Other carmakers have seen similar shutdowns in recent months as well.
The shortage of mining devices can be easily seen in Bitcoin’s hash rate. Since the halving in May 2020, Bitcoin’s hash rate has increased from about 92 million terahashes per second to its current reading of 166 million, an 80% increase. Bitcoin’s price, on the other hand, increased from $9,000 to over $46,000, a gain of over 400%.
Bitcoin’s hash rate has a relatively straightforward correlation with price. Barring new technological advances, increases in price should be closely mirrored by increases in hash rate. While the rate of new devices coming online should lag behind the price in bull markets, the hash rate has remained relatively stagnant in the past few months.
This means that current miners are seeing much higher revenue for individual devices, which, added to the shortage, results in inflated unit prices for ASIC miners. According to ASICMinerValue, obtaining a Bitmain S19 Pro right now costs about $9,000, while its official price is less than $4,000.
According to Jiang, the mining industry also saw major issues in 2020 due to Bitmain’s internal power struggle. “The indefinite delay of the Ant mining machine S19 in June, July and August 2020 caused us a lot of difficulties. We underwrote our customers according to the shipment period and used our own machines to make up the revenue to our customers,” Jiang said. With the Bitmain saga being resolved in favor of Micree Zhan, there should be no more specific issues with purchasing the company’s miners.
Bitcoin ASICs hitting fundamental performance limits
Despite the variety of issues, 2020 was also a pivotal year for the Bitcoin mining industry due to the release of new-generation ASIC devices with improved energy efficiency. The industry leaders were the Bitmain Antminer S19 Pro and MicroBT Whatsminer M30S+ series. Publicly listed manufacturer Canaan also released new miners such as the AvalonMiner 1166 Pro and the liquid-cooled A1066I unit.
The new miners offered significant efficiency gains, primarily due to their more advanced chip lithography. The S19 Pro uses 7-nanometer chips, while the M30S+ uses 8-nm lithography. The measurement indicates the distance between two ends of a transistor on a chip — at these values, it is just a dozen atoms wide. Lowering the distance helps increase computing performance and reduce power consumption.
Jiang explained that the Bitcoin mining industry is currently experimenting with TSMC’s 5-nm process, while the chip manufacturer is already researching 3-nm lithography. A reduction from 5 to 3 nm would be a major achievement for the computing industry, as it would allow to pack roughly 60% more transistors in the same chip. But according to Jiang, the latest advancements in chip technology are hitting some fundamental physical limits:
“The smaller the nanometer [distance], the less significant the increase in power efficiency, because when the nanometers decrease to a certain level, it will involve quantum problems. [...] The quantum [tunneling] effect will cause electrons to jump around between different diodes, therefore, the electron leakage ratio will rise.”
The practical result is that newer chips will have better computing performance but are unlikely to carry as strong improvements in energy efficiency, Jiang said. “Bitcoin mining actually does not require high computing; it requires a better power efficiency — that is, the less power you consume with the same hash power, the better,” he added.
Other types of performance improvements like liquid cooling can be useful but do not radically alter the miner’s efficiency. Jiang explained:
“Liquid cooling can only improve the mining efficiency by a certain degree. For example, a machine with 100 watts per terahash power efficiency, if you use an air-cooling system, after a period of time, due to dust or inappropriate cleaning, the machine’s power efficiency will decrease to 105 watts-terahash, while the liquid cooling system can allow you to increase the efficiency to about 95 watts-terahash. That’s only a 5% improvement — this difference is not significant.”
Is now a good time to enter the mining industry?
The vastly inflated revenue for miners comes as the global electronics industry is under intense pressure. Normally, new devices would quickly fill the gap and bring down the average revenue to mean values. The current chip shortages mean that this outcome may take longer than usual to occur, but existing devices are still being sold at a significant-enough premium to make prospective buyers consider their actions twice. For example, the S19 Pro currently has a return-on-investment period of eight months based on the electricity price of $0.04 per kilowatt-hour. However, if its revenue were to collapse to the still-high levels of December 2020, the miner would need to work for up to 40 months to pay itself back.
In the three years that the miner could potentially require to turn a profit, new devices could make the S19 partially obsolete, prolonging the payback period even further. Still, according to Jiang, the mining industry could be heading for consolidation around state-of-the-art devices, with only marginal improvements over previous generations. This would improve the lifetime expectation for mining devices, ensuring the stability of any investment made now or in the future. ASICs have already stabilized to a significant extent, as the five-year-old Bitmain S9, for example, only became completely unprofitable after the 2020 halving but is now once again generating a reasonable profit of $3 per day, assuming electricity prices of $0.04 kWh.
“Unless you buy a very expensive mine at the peak of the bull market, it’s hard not to make profits,” Jiang concluded.
Are miners better hodlers?
Jiang believes that the economics of mining makes it a superior method to acquire Bitcoin and hold it through the entirety of a rally. According to him, most Bitcoin miners kept their BTC all the way to $20,000 in 2017, while regular holders had a much lower chance of holding through to the top.
Jiang didn’t wish to elaborate on the data source of this conviction, which goes against the general wisdom that miners immediately sell the Bitcoin they mine. An analysis by Coinmetrics shows a nuanced picture: Miners hold a very significant portion of the Bitcoin supply, most of which was acquired in the early years of its existence. Partially confirming Jiang’s thesis, during the 2017 bull market, the miners seem to have accelerated their selling only around October, closely timing the top at the time.
A sizable increase in the miners’ Bitcoin holdings can be observed toward the end of 2019, suggesting that they began holding a larger proportion of their proceeds. Still, the relative prevalence of miner holdings has been on a steady decline throughout Bitcoin’s history, indicating that most of the BTC they mine ends up sold on the wider market.
According to Jiang, though, miners can be less influenced by loss aversion: the natural human tendency of avoiding more profitable outcomes if they also carry higher risk.
He explained that the mechanics of mining make it psychologically easier to hold through volatile markets:
“The first reason is that the mining machine is like a golden goose that can lay golden eggs in the bull market, so no miners would sell this golden goose [...] The second reason is the process of selling mining machines is much more complicated than selling Bitcoin on exchanges.”
The case for acquiring Bitcoin exposure through mining remains nuanced. In most cases, breaking even on the investment requires waiting for a year or more, depending on the initial entry point. Compared to buying Bitcoin outright, miners may lose out on major price gains immediately after, but this is compensated by higher resilience during market downturns. The mining device can pay itself off even if the price of Bitcoin takes exceedingly long to return to its previous highs.
Bitcoin mining is not just for professionals
Being a successful miner is similar to running a business. After an initial setup cost, the venture can turn a steady profit but requires maintenance and oversight. Not everyone has access to the conditions required to set up a successful mining farm, the most important of which is the location — cheap electricity is a must for miners.
It is still possible to purchase ASICs from retail shops and mine at home, provided that the home electricity price is below $0.10 kWh. Such figures can usually be found only in developing countries that have ample natural resources.
Some mining pools and companies offer a variety of ways for others to use their facilities — for a fee. The primary methods are colocation and cloud mining, which differ significantly in terms of their structure. Colocation services merely charge a fee for electricity and maintenance, while the devices are provided by the client. Cloud mining services are, in general, much different and riskier than self-hosted mining. Usually, the contracts last a predefined amount of time and carry significant maintenance costs. This gives a limited amount of time to recoup the initial investment, making it more of a bet on the price of crypto with somewhat limited upside. Overall, the opacity of the mechanism often raises questions from regulators about the legitimacy of some cloud mining operations.
Jiang’s company recently launched a service called “joint mining,” which changes the business model of cloud mining to make it closer to real mining:
“For example, a customer spends 10,000 yuan [$1,540] to buy a mining machine to dig a mine. When he receives 10,000 yuan of Bitcoin from the mining machine, after his investment returns the capital, we start to charge service fees. The Bitcoin produced afterwards is net profit. We collect 20% of the net profit — that is, 20% of the Bitcoin produced later. If the customer doesn’t get back the money in the end, we won’t charge.”
The BTC.top platform is thus closer to an assisted colocation service than classical cloud mining, with the company also allowing clients to “withdraw” their miners and have them delivered to a destination of their choosing.
As the Bitcoin mining industry stabilizes and matures, the companies involved in the business may become important diversification tools for investors. The unique risk and reward profile of mining is similar to gold mining companies, which are traditionally included in many exchange-traded funds for gold exposure. Jiang concluded with another parallel between Bitcoin and gold:
“The bull market of Bitcoin has increased more than I expected, so I expect that the top of this bull market may not be $100,000 as I expected, but may reach $200,000 or even $300,000, making Bitcoin exceed the total market value of gold.”
In the last month, Cardano’s correlation with Bitcoin has turned negative
This can be attributed to the recent development upgrades on the Cardano Mainnet
The Mary Upgrade was implemented on the 1st of March and transforms Cardano into a multi-asset network
Cardano’s 50-day Moving Average is the support area to watch in March
In the last month, the digital asset of Cardano (ADA) has broken loose from the effects of Bitcoin. This is according to an observation made by the team at Skew that highlights a negative correlation between Cardano and Bitcoin in the last 30 days. The team at Skew shared this milestone via the following statement and accompanying chart demonstrating the anomaly seen with Cardano’s correlation with BTC.
Over the last month, ADAUSD correlation with BTCUSD dipped into negative territory, an extremely rare occurrence for non-stablecoins.
ADA Breaks Free From BTC Due to Mary Upgrade on the Cardano Mainnet
The case of Cardano breaking away from the influence of Bitcoin in the last 30 days can be attributed to the recent Mary Upgrade that was executed on the ADA mainnet on the 1st of March. The hype and excitement surrounding the Cardano upgrade resulted in the price of ADA setting a new all-time high of $1.487 – Binance rate – on the 27th of February and 3 days before the aforementioned upgrade
With the Mary Upgrade, Cardano will now become a multi-asset platform that will allow users to create custom tokens (such as NFTs) that will directly interact with the Cardano blockchain without the use of smart contracts. This in turn means that transactions on the Cardano network will be much cheaper than those of other blockchains such as Ethereum.
Cardano’s 50-day MA is the Support To Watch in March
At the time of writing, Cardano is in the midst of a correction as seen through the daily ADA/USDT chart below.
Also from the daily ADA/USDT chart, the following can be observed.
Trade volume is in the red indicating selling pressure
The MACD has crossed in a bearish manner above the baseline further confirming the correction
The trajectory of the daily MFI and RSI also confirm an ongoing correction for Cardano
The 50-day moving average currently at the $0.80 price area, is the next logical macro support for Cardano in the days and weeks to follow
Other support zones can be found at $1.034, $0.98, $0.90, $0.83 and $0.70
LINK price prediction suggests the crypto coin is struggling to maintain its support at the 100 simple moving average (SMA) on the 4-hour chart.
Price plummeting lingers as the short-term technical indicators show a bearish trend.
The MACD indicator has crossed below the signal line presenting a bearish outlook.
The TD sequential indicator on the 4-hour chart presents a buy signal in the offing.
At the time of writing, Chainlink is facing intense selling pressure, just like other leading cryptocurrencies in the market. Following its recent price rejection at the $31-mark, LINK has been dealing with overhead pressure that is starting to overwhelm the crypto coin.
Tentative support at the 50 SMA is doing little to protect the current price of LINK from the ongoing price breakdown.
LINK relying on crucial support to avoid further price decline under the $20 mark
At the time of writing, LINK is exchanging at $26.4 while holding firmly to its immediate support level provided by the 100 simple moving average (SMA). If the number 10 crypto asset continues with the current trend, bears might cut through this short-term anchor zone, triggering a massive selling action as more sellers will come in from the sidelines.
An extensive examination at the MACD, also known as the Moving Average Convergence Divergence, shows the current bearish trend might last longer than former trends. Keep in the mind that the MACD blue line is showing signs of crossing the signal line. This is a formidable bearish indicator.
In an event the MACD blue line moves towards the midline, LINK might revisit its next crucial support, extended by the 200 simple moving average (SMA) slightly below the $20 mark.
According to the IOMAP technical indicator by IntoTheBlock, LINK is currently facing intensifying selling pressure that is negatively impacting its valuation. This indicates that a price recovery might either take longer to materialize or delay.
According to the IOPMAP model, LINK experienced a lot of activities between the $27 and $30 region. Here, about 13,000 traders previously bought approximately 22 million Chainlink coins. However, the selling pressure being witnessed currently is likely to absorb the buying spree that was witnessed earlier.
On the other hand, the IOMAP technical indicator shines a light on a strong support region, running from $22 and $23. Approximately 10,500 traders are currently reaping profits from the roughly 34 million LINK coins bought within the price range.
If LINK manages to hold above this price region it might counter the current downward price trend that is headed below $20 mark.
LINK Price Prediction: Is there hope for the crypto coin?
Looking at the other side of the fence, the TD Sequential indicator shows a potential buying signal on the 4-hour chart. The technical indicator presents the current selling pressure is loosing momentum as buyers are preparing to take advantage of the current low prices.
If confirmed, LINK could reclaim lost ground in one to four 4-hour candlesticks.
What to expect from LINK’s price?
According to the 4-hour chart, most of LINK’s buy signals are getting confirmed. A move that might see the crypto coin recover significant lost grounds. Therefore, it is important to be on the lookout for a new key support level, especially the ones underscored by the IOMAP model.
At such a support level, buyers are most likely to rush for the crypto coin, creating a price upsurge from this level.
Disclaimer. The information provided is not trading advice. Cryptopolitan.com holds no liability for any investments made based on the information provided on this page. We strongly recommend independent research and/or consultation with a qualified professional before making any investment decisions.
Less than a year after launching its IOHK-owned network of federated nodes, Cardano is on schedule to reach full decentralization at the end of March 2021. At that point, the already established network of over 1,800 community pools will be responsible for producing all new blocks.
Cardano Goes for Full Decentralization
With the approaching so-called D (=0) day, IOHK, the company behind the popular blockchain project Cardano, published a post highlighting the latest milestone in its development.
Cardano is on track to get out of the realm of centralization in less than a month. The post explained that upon the release of the Shelley update in July 2020, the developers built the network in a way that every block was produced by IOHK’s network of federated nodes.
This caused some confusion within the cryptocurrency community as such an approach was the “antithesis of decentralization.” However, the statement justified this somewhat controversial decision with enhanced security – “a wise approach for the near term while the stake pool operator (SPO) network got up and running.”
Furthermore, Cardano’s developers built in an automatic readjustment process, which reduced the parameter that governs what percentage of transactions are processed by the genesis nodes (referred to as d) at a rate of 0.02 per epoch. This means an increase by 2% in community block production every five days.
Thus, the community received a more significant role in block production over time, which led to the current situation – only 12% of blocks are produced by federated nodes. The number will continue to gradually decrease until it reached zero (also known as D=0 Day) on March 31st.
Upon doing so, the network will become “fully decentralized,” as “D=0 pushes power to the edges.”
ADA Price Update
While the Cardano community is patiently anticipating the D=0 day, the native cryptocurrency has been on a roll since the start of the year, despite the recent retracements.
ADA entered 2020 at about $0,18 before it skyrocketed to a new all-time high just shy of $1.5. Following this 730% surge, the asset retraced slightly intact with last week’s market crash but has remained well above the $1 tag.
Naturally, ADA’s price surge impacted the market capitalization as well. As such, ADA surpassed other altcoins like Binance Coin and Ripple and is currently the 3rd largest cryptocurrency by market cap.
The Dallas Mavericks, a professional basketball team based in Dallas, has announced that it will be the first NBA team to accept Dogecoin as a payment method, allowing crypto holders and fans to buy tickets and merchandise using the popular cryptocurrency.
The decision is the result of BitPays announcement of the rollout of Dogecoin payments for merchants and consumers using their cryptocurrency payment services.
Stephen Pair, CEO of BitPay, referred to the team’s decision by stating:
“The Dallas Mavericks are a long-time enthusiast of cryptocurrency, opening up new opportunities for the team to sell tickets and merchandise to its global MFFL fan base. BitPay believes that with continued cryptocurrency adoption, the industry is reaching an inflection point that will forever change consumer confidence, trust and pave the way for blockchain payments to disrupt the way consumers and businesses receive and spend funds.”
The Dallas Mavericks have been accepting Bitcoin payments for more than 2 years, with other cryptocurrencies like BCH, ETH, USDC, GUSD, OAX, BUSD, and now DOGE also being accepted.
Cuban is Hot for Dogecoin
Mark Cuban, one of the co-owners of the Dallas Mavericks, has been a vocal supporter of cryptocurrencies as he believes that the “tech is here to stay” and has the potential to disrupt different industries by facilitating transactions.
Cuban compared cryptocurrencies to the internet in previous interviews, sharing his thoughts that cryptocurrency supporters were crazy in a way reminiscent of the early days of the internet.
The Mavericks also made the news earlier this year when he released his personal NFT collection titled “The RollUp 202!, which had the highest bid of 7.3 WETH, the equivalent to. $10,813.65.
Back on Tuesday 2nd, ATM provider CoinFlip announced that it would now allow users to purchase DOGE in any of the ATMs in its 1800 machine network, further increasing the use cases of the cryptocurrency.
Despite the growing support for DOGE by the cryptocurrency community, some financial experts like Michael Novogratz believe that the adoption of DOGE by brands like the Mavericks is a mistake not because it is crypto but because it puts inexperienced investors at risk.
He referred to Cuban’s move in an interview with Bloomberg TV by stating:
“Let’s put people in the safest best stuff, not these joke coins. I think Mark’s making a mistake there. He’d be better off with 15 other different ways to pay for his tickets.”
The Power of Meme Culture
Internet culture has become increasingly influenced by meme culture over the past years.
Originally seen as a niche in unknown internet boards and forums like 4chan and Something Awful, memes have quickly become a staple of the internet used widely by people around the world.
Just like Richard Dawkin’s definition of meme proposed in his book “The Selfish Gene”, internet memes can spread and repeat themselves across communities in a way that allows them to operate as a new means of communication
As memes become more heavily ingrained into popular culture, they have also become tools at the disposal of governments, companies, and communities to spread their messages and join people under the same cause.
In recent months, the popular website Reddit made the news as members of the WallStreetBets subreddit join efforts to raise the prices of Gamestop stocks, which resulted in hedge funds losing millions of dollars while internet users enjoyed the gains and regulators had to intervene.
While the history of Dogecoin so far is the history of other internet memes, raising to popularity due to the irony and messages they imply, the cryptocurrency has transformed into something else as time passes on: a real project with real-life applications.
After all, any kind of money has value only if it has people who believe it does.
The city of Reno, Nevada is developing its own DAO and NFT system on top of the Tezos blockchain network, Mayor Hillary Schieve said.
Reno, the closest major city to the famous art festival Burning Man, is developing its own decentralized autonomous organization, or DAO, and a token in partnership with Tezos.
Mayor Hillary Schieve announced the city’s plans to create the Reno DAO in a Thursday Tez Talks podcast hosted by the Tezos Commons Foundation.
The city will build its Reno DAO and Reno Coin on top of the Tezos blockchain network in order to monetize art objects and pieces as well as further explore the potential benefits of blockchain and crypto to solve some of its biggest pain points, Schieve said.
As part of the plan, the city also plans to digitize Burning Man artwork in the form of non-fungible tokens, or NFTs. According to Schieve, the city of Reno will create its first NFT for Burning Man’s Space Whale sculpture, a major festival artwork located in Reno. The mayor said that turning the artwork into an NFT would help the city monetize and support local art and serve as a starting point for the mainstream adoption of crypto:
“It’s gonna take a long time to adopt, we know that […] But eventually, this will end up being mainstream, where citizens will get it, and I think you also have to walk before you can run. There are really easy ways to get my community to start using cryptocurrency to pay for things like sewer payments.”
Theodore Clapp, a local undergrad researcher involved in the initial design of the Reno DAO, chose the Tezos ecosystem for building the project. Clapp explained that he found Tezos the best fit for the DAO in terms of its resources and frameworks. “So I eventually decided on Tezos,” the researcher said, elaborating:
“I’m not biased, I’m not like a Tezos maximalist or anything. I just went to CoinMarketCap and went down the list investigating the different blockchains and the technologies that were available, to actually develop a DAO, because I was trying to find the best platform for scalability, fees, long-term sustainability.”
Cardano saw a bounce to $1.17, but this move did not yet confirm that ADA was on the road to recovery. On the contrary, Basic Attention Token and Dogecoin noted bearish momentum, a continuation of their short-term downtrend over the past few days. Cardano [ADA] On the hourly chart, ADA appeared to have broken out […]
Bitcoin has sparkled so far this year. The price of the digital coin is currently experiencing a price pull back at the $50K level and that speaks volumes about its performance. Many opinions are flying around the crypto space regarding Bitcoin’s next step as its impressive journey isn’t looking to stop any time soon.
Bitcoin has also seen a new wave of institutional influx as traditional financial institutions have taken more than a sudden interest in the cryptocurrency as the somewhat endless glow around the coin continues to shine.
Jesse Powell, Kraken CEO and co-founder has now stated that he believes the price of Bitcoin is “going to infinity. Mr. Powell made the comment when asked by reporters what his expectations were regarding Bitcoin.
According to Powell, Bitcoin fanatics firmly affirm that Bitcoin is going to be the world’s top currency. He added that Bitcoin’s market cap could basically equal that of the dollar as well as the euro or both of them combined.
“Of course you know we can only speculate. But when you measure it in terms of dollars you have to think it’s [Bitcoin] going to infinity,” Powell said. “And I think the true believers will tell you that it’s going all the way to the moon, to Mars, and eventually it would be the world’s currency,”
Powell also stated that Bitcoin has a very moderate chance to hit $1 million in the next 10 years, citing the rate at which the U.S. Government continues to print money as a major factor in Bitcoin’s quest to reach infinite numbers.
“I think people are increasingly looking to Bitcoin as a safe haven asset. They see it as a better version of gold, and something to protect them against all of this inflation that’s happening.”
The notion of Bitcoin being a safe haven asset had been solidified even more this year after multi-billion dollar financial corporations have labeled Bitcoin a hedge against market variations.
Powell tipped the presence of the young generation in the current crypto space as a factor that will help propel the digital coin to greater heights. The CEO of Kraken also made news back in December 2020 when he labeled the U.S fiat currency, as a “risky prospect” compared to BTC when in possession.
A Hong Kong-based cryptocurrency exchange could be Futbol Club Barcelona’s next shirt sponsor. According to a report by La Vanguardia, the deal could be worth over 60 million Euros a year, a figure that amounts to over $70 million. It has been speculated that DSDAQ is the entity in question, with the crypto-platform reportedly backed […]
Cardano (ADA/USD) bounces off a critical support trendline during the Asia-Pacific trading session Friday.
The blockchain asset expects to close above key moving average waves on the prospect of turning into a multi-asset chain following its hard fork on March 1.
Nonetheless, a death cross formation offsets the probability of more price legs higher.
Levels to watch
A sell-off in the Cardano market Thursday brought its benchmark instrument ADA/USD down by more than 11 percent.
The pair touched a week-to-date low of $1.02, about 31 percent lower than its record high established on February 27. It later underwent a modest recovery phase after finding support in a short-term upward trendline. The bounce prompted the price to attempt a close above its 50-period moving average, only to pull back later owing to higher selling pressure near the blue wave.
It appears likely for Cardano’s ADA to retest the ascending trendline support, further pressured by a death cross formed after the 20-period moving average slipped below the 50-period moving average. It signals additional selling pressure in the market in the short-term.
Should the sell-off continue, ADA/USD risks plunging towards its 200-period moving average. It is right now around $0.88. Meanwhile, an extended slipover below the orange wave would have traders view $0.80 as their downside target. The level has served as support all across February.
Bullish Fundamentals for Cardano
The downside correction in the Cardano market follows its 700 percent-plus price rally in 2021. ADA/USD rallied partially because of an overall upbeat sentiment in the cryptocurrency market, led by Tesla’s $1.5 billion investment into Bitcoin. Altcoins tend to tail the benchmark cryptocurrency’s price trends.
Second, the ADA price surged amid a broader rally among projects that rival Ethereum, the second-largest cryptocurrency by market cap and the leading blockchain network with smart contract functionalities. The transaction and gas fees on the Ethereum network surged aggressively during the February session, prompting speculators to make bets on its rivals.
Cardano briefly surged to the third rank in the top cryptocurrencies’ list, only to get replaced by Binance Coin, a token that represents Binance Smart Chain in addition to a full-fledged cryptocurrency exchange of the same brand.
Nonetheless, the reason why traders raised their bids in the ADA/USD market was “Mary” — a hard fork that made Cardano a multi-asset chain network upon its successful deployment on March 1. Cardano’s upgrade will enable new tokens on its network and offer smart contract services just like its rival Ethereum.
“Slowly but surely, the momentum is fading away from Cardano after the Mary hardfork,” noted Michaël van de Poppe, an independent market analyst. “That’s normal. Natural market movements. Hype pre-event, calm, and getting back to equilibrium after the event. That’s how it always goes. ADA will continue running later.”