Bitcoin Sell-Off Over? Bullishness Continues to Permeate the Market

This week, the price of Bitcoin has been on a rollercoaster ride. We started with a dump right after hitting a new all-time high last Sunday at about $58,350.

Following the drop, we made several attempts to go back up but only to end up lower and yesterday, we went down further down to $44k.

As of writing, BTC is seeing some relief trading around $46,800 but that’s to be seen if the upward momentum will continue or take us only lower. Trader TheCryptoDog said,

“At this point my assumption is we don’t go lower from here. That can change at the drop of a hat (we’ll see what happens to macro on Monday), but looking at this now I would be more surprised to see BTC sink.”

One caveat is March, the month which in the last six out of seven times have been a red one with an average drawdown of over 14%.

Unlike BTC, Q1 is good for Ethereum which five out of six times ended with significant greens, already it is up 102% YTD despite the losses. This week, it went down to $1,350 during this recent sell-off, even lower than the previous ATH of $1,420.

Bitcoin’s lack of direction, right now, is turning out good for altcoins, leading to a 15% to 30% uptrend. The total market cap has also recovered to $1.455 trillion, adding more than $100 billion in the past 24 hours.

All This Bullishness

While the price action in the market isn’t’ looking bullish, the developments in the market certainly suggest so.

For starters, the first Bitcoin ETF debuted on the TSX last week, Purpose Bitcoin ETF (BTCC) continues to see demand and now holds more than 10,000 BTC.

If we look at the premium on the Bitcoin product of the world’s largest digital asset manager, Grayscale which went negative this week, but is expected to be just short-term noise, could actually turn out to be bullish.

Started in late Sept. 2013, “Outside of 2013-2014 this has only occurred 4 times. With fees of 2% and a current discount of 2.5%, BTC can be bought inside the trust cheaper than at market,” noted one analyst.

“Like the last 2 times, does the bull continue?” he added.

Bitcoin miners are also sending bullish signals as they stop their selling and start accumulating BTC. For the first time in two weeks, Miners Position change has turned positive.

The Spent Output Profit Ratio (SOPR) indicator, which is the price sold / price paid, is another one that has gone back to level 1, indicating the bottom on the sell-off.

Not to mention, money-making exchange Coinbase has announced its public listing and got more than $100 billion valuation. This would make the company CEO, Brian Armstrong who previously worked at Airbnb to get rich and join the world’s 500 richest people.

Even more bullish is the news that the House passed its $1.9 trillion coronavirus relief package early on Saturday, which will now head to the Senate. Democrats are rushing to approve more aid before unemployment programs expire on March 14.

This time, payments of $1,400 will be made to most individuals, along with the same amount for each dependent. $1,200 stimulus check from last time invested in Bitcoin at the time is currently worth $8,500 and surpassed $10,000 last week.

And just like the last stimulus package, this could propel the market higher.

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Author: AnTy

UK Treasury-Ordered Report Calls for A 5 Point Plan; Includes FinTech Fund & Crypto Regulation

UK Treasury-Ordered Report Calls for A 5 Point Plan; Includes FinTech Fund & Crypto Regulation

Treasury report based on the U.K. fintech, concludes govt needs to run a specific regime for Crypto-asset’s regulations and control.

U.K. chancellor, Rishi Sunak, triggered that review back in March 2020, under Ron Khalifa’s supervision (former WorldPay boss). Afterward, the Treasury-ordered review points out a plan to make U.K.’s fintech a leading market in the world.

According to the report named “Khalifa Review of U.K. Fintech,” the country can play a vital role in crypto-mania and become a globally recognized center for trade, issuance, clearance, and exchange of cryptocurrencies.

Khalifa addressed the European finance’s progress after the crypto favored the proposal, MiCA (Markets in Crypto-assets), has come in force, so the U.K. also has to “act quickly” to put its fintech firms ahead of the curve. Khalifa’s Review states,

“The U.K. should aim to be at least as broad in ambition as MiCA – but should also consider whether it can develop a bespoke regime that is more innovation-driven. A bespoke regime for crypto assets should adopt a functional and technology-neutral approach, in line with the principles of the current regulatory framework, as well as the concept of ‘same risk, same regulation,’ while being tailored to the risks arising from crypto asset-related activitie.”

Also, there are no reasons to be ‘flexible’ to do with future challenges such as Decentralized Finance (DeFi), another spot that needs attention for being regulated in the state, says the report.

The review concludes that to have engagement in deploying policies and regulations for crypto-favored areas, U.K. must join the group of international regulators, Global Financial Innovation Network (GFIN).

The U.K. Treasury has announced a consultation worldwide that started in January to depict the regulatory experience approached digital currencies and stablecoins. The program is still accepting feedback till March 3.

U.K. commissions have been aggressive to crypto trading and investments so far. On January 6, derivatives and exchange-traded notes sale was shut down by Financial Conduct Authority (FCA) which alleged the products ill-suited due to the potential harm they pose.

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Author: James W

Bitcoin Lending Grew Nearly 12x; Only Accounts for 0.15% of the $20T Total Collateral Market

There is also growing demand for Ether among traditional actors entering crypto lending with ultra-high-net-worth individuals, corporations, traditional hedge funds, and family offices wanting to enter the market looking to generate excess yield on idle cash.

Total active collateral in the Bitcoin lending markets has grown from $1.9 billion in Q3 2019 to a whopping $24.3 billion in Q4 2020, reveals the latest joint report by Arcane Research and crypto exchange Bitstamp.

The crypto lending market is simply flourishing, but it has a long way to go with the collateral markets’ current size estimated to be $20 trillion, providing a huge potential for bitcoin as collateral.

Over 400,000 BTC are estimated to be used as collateral for Bitcoin-backed loans today, doubling over the last year, reads the report. It is particularly used to leverage up and buy more crypto for arbitrage, market-making, tax deferment, and the need for fiat and miners covering costs.

The interest rate on Bitcoin deposits is currently high at 6-10%, which is expected to decline as more BTC are collateralized, and the crypto sector grows.

In total, 625,000 BTC, approximately $30 billion, are used as collateral in the crypto market today, based on estimations of collateral held in the derivatives market and tokenized BTC in DeFi. Still, bitcoin collateral only accounts for 0.15% of the total collateral market, which is growing rapidly, states the report.

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Arcane Research expects further growth in the BTC lending market, which could be “very bullish” for Bitcoin as it allows users to employ their cryptocurrency to serve their everyday fiat-needs, without requiring the hodlers to sell and realize profits.

Bitcoin, which can be transferred around the world instantly, at almost no cost, is a superb collateral asset because it is without both counterparty risk and credit risk, reads the report.

Institutions are just as interested in the crypto lending market, with institution-focused Genesis seeing a YoY growth of 245% in their outstanding loans.

One of the market-leading companies in the lending market, Genesis has seen incredible growth over the past year. Their outstanding loans surged to $3.8 billion in Q4 of 2020, a roughly 80% growth from Q3.

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The company further processed nearly $20 billion on loans last year to institutions only, “showing tremendous demand for traditional actors entering crypto lending.” In Q4, the company also pointed to the inflow of institutional lenders as well with ultra-high-net-worth individuals, corporations, traditional hedge funds, and family offices wanting to enter the market for the first time looking to generate excess yield on idle cash.

But it isn’t only about Bitcoin; there is also growing demand for Ether among institutions. There has been a steady increase in ETH loans outstanding, which grew 177% during the last three quarters of 2020.

Like BTC, this growth was attributable to ETH’s price inflation, the biggest reason was tied to in-kind placements in Grayscale’s Ethereum Trust, according to Genesis.

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BlockFi is another company leading in crypto lending with over $4 billion in outstanding institutional loans. According to the report, BlockFi’s internal numbers show that the company is a clear competitor to Genesis on the institutional side.

In 2020, BlockFi processed $18.6 billion in loans to its institutions and private clients, and by the end of the year, it had $4.4 billion in outstanding institutional loans. These clients aren’t just based in the U.S. either, just 60%, but spread across the world — 25% in the Asia-Pacific and the last 15% are based in Europe.

Other notable competitors in this sector are Celsius which processed over $8 billion in loans, Nexo which has over 1 million users and shares profits with its token holders, and Nebeus, which was one of the first movers in 2014.

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Author: AnTy

Grayscale Is Considering 23 New Crypto Assets, Especially DeFi Coins, for Offering

Grayscale Is Considering 23 New Crypto Assets, Especially DeFi Coins, for Offering

Grayscale Investments, the world’s largest asset manager with more than $39 billion in assets under management (AUM), has announced that it is considering several new digital assets for potential new product offerings.

The firm offers its investment products to institutions and individual accredited investors. Chief executive officer Michael Sonnenshein said,

“We’re eager to expand our product offerings to better serve our investors.”

“The digital currency universe is constantly evolving, and we seek to identify bold, interesting, and innovative opportunities that satisfy our investors’ demand for differentiated exposure to this burgeoning asset class.”

Currently, the firm offers exposure to a limited number of crypto assets, viz. Bitcoin (BTC), Ethereum (ETH), Stellar Lumens (XLM), Zcash (ZEC), Litecoin (LTC), Bitcoin Cash (BCH), Ethereum Classic (ETC), and Horizen (ZEN).

Amidst the “growing investor demand for exposure to digital assets,” the firm looks at cryptocurrencies particularly related to the decentralized finance (DeFi) sector.

The digital assets currently under consideration include Aave (AAVE), Compound (COMP), Polkadot (DOT), Uniswap (UNI), Sushiswap (SUSHI), Yearn Finance (YFI), Synthetix (SNX), Chainlink (LINK), and MakerDao (MKR), which are popular among the community.

Other coins are The Graph (GRT), Cardano (ADA), Reserve Rights (RSR), Flow (Dapper Labs) (FLOW), Decentraland (MANA), Basic Attention Token (BAT), Cosmos (ATOM), Filecoin (FIL), Livepeer (LPT), Tezos (XTZ), Monero (XMR), Numeraire (NMR), Stacks (STX) and EOS. However, Sonnenshein clarified,

“We may not turn each of these assets into one of our landmark investment products.”

“But as a firm that has been on the vanguard of connecting the legacy financial system with the new, digital currency-driven financial system, we view it as our responsibility to introduce investors to more diversity in this space.”

While there is no guarantee that any of these assets under consideration will be introduced on Grayscale, which is subject to internal controls, sufficiently secure custody arrangements, and regulatory considerations if any newly-created product is indeed chosen, it will be announced separately upon launch.

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Author: AnTy

Jittery Macro Affecting Crypto But US Institutional Investors Continue to Buy Bitcoin

Jittery Macro Affecting Crypto But US Institutional Investors Continue to Buy Bitcoin

Bitcoin continues to be under selling pressure as the digital currency drops to nearly $46,000.

This latest weakness in the price of Bitcoin has been despite the Coinbase whales scooping coins off the market. In the last 24 hours, more than 30k BTC worth approximately $1.5 billion has moved out of Coinbase reserves.

A similar Bitcoin purchase preceded the $24k breakout when the digital assets moved from weak hands to strong hands.

“Another significant Coinbase outflows at 48k. US institutional investors are still buying BTC,” said Ki-Young Ju, CEO of crypto data provider CryptoQuant. “I think it will eventually go above 48k, which is the institutional buying level,” he added.

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As we reported, the ongoing stock sell-off has been dragging the crypto market down. It is basically the result of what’s going on in the macro environment with bond yields rising, pushing the US dollar up, which is not good for risky assets and gold. Young Ju said,

“I think the major reason for this drop is the jittering macro environment like the 10-year Treasury note, not whale deposits, miner selling, and lack of institutional demand.”

With the continuation of the big bond sell-off, investors have shifted their risk preference from high to medium. The Federal Reserve Chairman Jerome Powell meanwhile continued with the same rhetoric, committing to its ultra-loose monetary policy, exactly what the market wanted to hear.

But yields, which actually move inversely to the price of the bond, had a sharp increase still, which means investors are selling off their “worthless over-abundant government debt,” noted analyst Mati Greenspan in his daily newsletter Quantum Economics.

Besides the cryptos, which are trying to rally but struggling to reclaim the highs, the top tech stocks have been taking a beating. The tech-heavy Nasdaq had its worst day in four months, sliding 7.6% from its early February peak before ending Friday with a slight uptick. About the ongoing equity-crypto correlations, trader and analyst Alex Kruger says,

“For correlations to be meaningful, their *flows* must be significant relative to other flows. Hence why you will often see correlations spike during times of market turmoil, and diminish during times of heavy inflows into bitcoin when driven by bitcoin specific factors.”

According to him, the crypto market can rebound over the weekend if risk assets stay strong.

However, with March seasonality coming into play, the month that has been the majority of the times seen red price action, the market may see some sideways action next month if not bearish onslaught.

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Author: AnTy

Binance Launches Solana (SOL) Staking; Holders Earn Up to 43% APY Paid Daily

Binance Launches Solana (SOL) Staking; Holders Earn Up to 43% APY Paid Daily

The largest crypto exchange in the world, Binance, has launched Solana staking. Users of the exchange now have an opportunity to earn up to 43.79% per year for staking SOL tokens.

The high-speed blockchain, Solana, which states it can handle about 65,000 transactions in one second, is designed to work under a proof-of-stake design model. The network is kept running by validators who earn SOL tokens for their work.

The SOL staking will be offered on a first-come, first-served basis where the entire stakes will be locked for a time to be determined by the holder, which will range from 15 to 90 days.

The launch includes a “high-yield, safe earn” on an annual basis so long as the staked amount is only 20 SOL equivalent of $325. This translates to about $142 total earnings if the SOL tokens are locked up for one year.

Binance also announced that those staking 10,000 SOL for only 30 days would earn 14.49%, while those staking 5,000 SOL for two months (60 days) will earn 16.7%.

Although proof-of-stakes are getting popular, they come with various risks. These platforms are created using a slashing process, which means that the platform is prone to stopping or slashing the transactions initiated by a malicious validator. This means that one can lose funds permanently. However, if Binance can ensure that all its validators are online and doing nothing malicious, there is nothing to worry about.

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Author: Joseph Kibe

Mt. Gox Trustee Calls for a Vote on Draft Compensation Plan for the 150,000 Bitcoins

Mt. Gox Trustee Calls for a Vote on Draft Compensation Plan for the 150,000 Bitcoins

Court-appointed trustee of the defunct Japanese crypto exchange, Mt. Gox, asks creditors to vote on a draft rehabilitation plan to start the compensation process. The trustee currently holds about 150,000 BTC, or approximately $7 billion, as of writing.

A letter by Nobuaki Kobayashi, the appointed trustee of the remaining Mt. Gox Bitcoins, states he filed an amended draft rehabilitation plan with the Tokyo District Court on February 15, 2021. The trustee is now giving creditors a chance to approve the draft plan through a vote to determine how the remaining assets from the long-defunct Mt. Gox exchange will be compensated.

The deadline to determine eligible voting rights holders passed earlier this week on Wednesday, with the deadline for notice of non-uniform exercise of voting rights set on September 10. The voting will be conducted through the mail, online, and in-person, with the resolutions being decided by October 20 during the creditors’ meeting.

The trustee is said to hold about 150,000 BTC (7 billion, as of writing), with over 20,000 customers filing claims for a refund. According to the draft, Bitcoin (BTC) and Bitcoin Cash (BCH) holders will receive their real assets, while other altcoins will be liquidated and returned in fiat.

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Author: Lujan Odera

Singapore’s Sovereign Wealth Fund Leads Digital Asset Bank Anchorage’s $80M Series C Round

Singapore’s Sovereign Wealth Fund Leads Digital Asset Bank Anchorage’s $80M Series C Round

Anchorage has raised $80 million in a Series C round led by Singapore’s sovereign wealth fund GIC with participation from a16z, Blockchain Capital, Lux, and Indico.

“Largest sovereign wealth funds leading rounds in global crypto-asset custodians,” commented Su Zhu, chief executive officer, and chief investment officer at Three Arrows Capital.

Earlier this year, Anchorage received a national trust charter from the Office of the Comptroller of the Currency (OCC), making it the first federally chartered digital asset bank in history.

“Anchorage has gone through a brilliant metamorphosis — from a world-class custody solution to the standard-bearer for crypto banking,” said W. Bradford Stephens, Co-founder and Managing Partner of Blockchain Capital.

“In just a few short years, they’ve already been a powerful, catalytic force for institutional adoption, regulatory confidence, and overall maturation of the space.”

Now it is raising funds to expand its digital bank services with a focus on enabling institutions to participate in the digital asset space.

The firm laid down its five key goals for the year ahead, including offering at-launch support for new protocols. It will also continue to invest in broad asset support, just as with Filecoin, Oasis Protocol, and Celo.

Anchorage has already been seeing an “influx of interest” ever since it obtained the charter and helping organizations participate in digital assets through corporate treasuries and endowments.

As a bank, the focus is also to make crypto lending even more seamless and secure, and they further plan to scale its lending products and operations.

Besides partnering with neo banks, challenger banks, and traditional banks, the idea is to make institutional DeFi participation accessible.

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Author: AnTy

GlobaliD Launches New XRP MasterCard Debit Card; Earn Rewards Up to 5% Cashback

GlobaliD Launches New XRP MasterCard Debit Card; Earn Rewards Up to 5% Cashback

  • GlobaliD, a digital identity platform, launches a MasterCard debit card to allow users to spend, pay, and get paid through XRP, the sixth-largest cryptocurrency.
  • The card offers users up to 5% cashbacks on any amount spent through the debit card.

In an announcement on Thursday, GlobaliD confirmed developing a unique XRP debit card that is expected to launch later this year in the U.S. The MasterCard debit card offers users a quick and cheap avenue to transact and pay using digital assets offering cashback to customers who join the waitlist.

The first 1,000 customers will earn up to 5% cashback on their purchases using GlobaliD’s debit card on the first $10,000 spent. The next 2,000 customers will receive 4% cashback on their purchases up to a similar amount, while the remaining customers are promised a 2% cashback on their purchases using the debit card.

The card can be used in any MasterCard accepted merchant store in the world.

GlobaliD confirmed the initiative did not involve Ripple Inc. in any way despite joining the PayID Open Payments Coalition in 2020, which also houses Ripple.

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Author: Lujan Odera

A “BIG Deal:” Stone Ridge Files to Add Bitcoin to its Diversified Alternatives Fund

A “BIG Deal:” Stone Ridge Files to Add Bitcoin to its Diversified Alternatives Fund

It “opens the door for every mutual fund to add BTC,” says excited Anthony Scaramucci of SkyBridge on asset manager becoming the open-ended mutual fund to buy Bitcoin.

Stone Ridge, the New York-based asset manager, is adding Bitcoin to its diversified alternatives fund as the seventh investment strategy. The addition of Bitcoin will become effective on April 26, as per the SEC filing.

As it filed to become the open-ended mutual fund to buy Bitcoin, Anthony Scaramucci of SkyBridge, which is also invested in Bitcoin, called this a “BIG deal.” “Stone Ridge filing opens the door for every mutual fund to add Bitcoin (if they want to),” he said.

This fund seeks to generate total returns from diverse investment strategies that “we believe have the potential for attractive returns and are diversifying from stocks and bonds,” reads the document.

The Fund intends to gain exposure to the price of Bitcoin by selling put options on bitcoin futures contracts. It will be selling at-the-money or out-of-the-money exchange-traded cash-settled put options on bitcoin futures contracts.

Investing in pooled investment vehicles, such as registered or private funds, that themselves invest in bitcoin is another way to gain exposure to the leading digital currency, the filing states. Through the options market,

“The Fund seeks to generate positive returns but with less participation in market declines relative to what an investor might experience by holding the underlying bitcoin futures contracts, or bitcoin itself, directly.”

The filing mentions a series of usual risks to the exposure to Bitcoin, which includes high price volatility relative to more traditional asset classes, which means the value of bitcoin could decline rapidly, “including to zero.”

Besides the market risk, adoption, limited use in the marketplace, obstacles to scaling cybersecurity, forks and airdrops, exploitation of source code, 51% attack, double-spending, miner collusion, stablecoins, competition from other digital assets, and government oversight, among others are also listed under the risks.

Stone Ridge’s subsidiary New York Digital Investment Group (NYDIG), is already involved in the crypto space, which has raised $100 million over the past two years.

With 280 institutional customers, NYDIG stores $6 billion worth of Bitcoin and 10,000 BTC of its parent company.

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Author: AnTy