Bitcoin in For Another Bull Cycle as BTC Supply Continues to Get Eaten Up Like Never Before

Over the weekend, the price of Bitcoin started rising and is currently trading above $11,650.

Interestingly, it has been three months, 93 days exactly, since Bitcoin was founded in 2009, that it has spent above the current price of $11.5k.

More importantly, it’s the first time that bitcoin has been above $10,000 with realized volatility extremely low, as per Skew.

While trading in the green, the ‘real’ amount of the BTC traded in the past 24 hours has fallen drastically to just over $700 million.

This lack of volume could be on one side due to the lack of price action in the market and the weekend. On the other hand, the BTC balance on exchanges is on a constant decline. An analyst noted,

“More and more Bitcoin getting out from exchanges and most probably being transferred to non-custodial wallets. This suggests slightly lower liquidity and lower selling pressure going forward.”

BTC Balance on Exchanges
Source: Glassnode

According to Chain.info, in the past 24 hours, the biggest outflow of BTC has been recorded on OKEx of 6,269.

Last week, the exchange suspended all digital currency withdrawals after one of its key holders who has been helping the authorities in an investigation was unreachable.

Additionally, as per Coin Dormancy, a measure of “old hands selling out,” which usually sold the tops have been acting differently in the current cycle. “They sold the bitcoin bottom at $3-$4k, they are selling right now,” observed on-chain analyst Willy Woo.

Coin-Dormancy
Source: Glassnode

Another Bull Cycle in the Making

While Bitcoin continues to move out of exchanges in favor of cold wallet storage, for the first time, public companies are gobbling up more and more BTC by making it part of their Treasury. Grayscale, yet again, for the third time in a row, had a record inflow in Bitcoin.

According to Grayscale’s Q3 report, they bought 77% of all the BTC mined in the quarter, up from 70% in Q2 and 27% in Q1. Dan Tapiero, co-founder of 10T Holdings said,

“SHORTAGES of Bitcoin possible. Barry’s Grayscale trust is eating up BTC like there is no tomorrow. If 77% of all newly mined turns into 110%, it’s lights out. Non-miner supply will get held off mkt in squeeze. Shorts will be dead. Price can go to any number.”

Overall, the market is bullish on digital assets, as Pantera Capital wrote in its last week’s investor letter; besides the network fundamentals, all the money printing the Federal Reserve and other central banks are doing works in bitcoin’s favor.

“We strongly believe we are in the early stages of a large bull market fueled by both a powerful global macro tide and growing fundamentals in the underlying technology.”

Major Bitcoin Price Cycles
Source: Pantera Capital

In its decade long life, Bitcoin has gone through three major prices already and seems to be primed for yet another one.

“My intuition from trading waves for 35 years is we’re in for another one,” wrote Dan Pantera, adding, “it’s still a massive hype cycle roller coaster.”

Read Original/a>
Author: AnTy

Bitcoin Miners Generating BTC at Fast Pace & ‘Running Down Inventory’ Just as Hard

Bitcoin started this week on a bullish note, reaching above $11,700 only to drop to nearly $11,200 level on Friday after crypto exchange OKEx announced that cryptocurrency withdrawals had been suspended.

According to the local media, two of the executives, including its founder, Star Xu, arrested by the police, have been released on bail. Star Xu has been reportedly assisting in the investigations.

The exchange maintained that the investigation is “not related in any way to anti-money-laundering or to OKEx,” and that the funds are safe and all other functions are unaffected.

OKEx actually holds 1.1% of Bitcoin’s circulating supply (200,000 BTC worth $2.3 billion), and before the suspension of withdrawals, large BTC outflows were observed from the exchange.

As per Glassnode, “a total of 10,000 BTC ($113 million) were withdrawn in two large batches in the past 48h.”

Market Unchanged

Yesterday, what made matters worse for the already jittery markets was the Deribit exchange that was temporarily out of action due to maintenance that had not only BTC price falling but also the futures curve flattening yet again.

On-chain analyst Willy Woo actually expects the last CME gap around $11,200 to get filled as he sees hidden distribution at spot exchanges, with volume sell-off not yet reflected in the price.

But in the near term and overall, he remains bullish, signaled by the growing market fundamentals.

“The on-chain fundamentals which are 3-6 weeks at the minimum timeframes are still unchanged in bullish mode, if we do get a pullback, I’d take it as a chance to deploy capital into BTC if you missed it in the 10k zone,” said Woo.

Still, Some Weakness in Near Term

While the network fundamentals, the hash rate has made an all-time high, miners are “running down inventory quite hard today.” With MRI currently above 100%, it means miners are selling more Bitcoin than they are mining.

This, according to Charlie Morris of ByteTree, is an indication of a “Healthy market to sell into.”

Interestingly, with more than ever hash power used to mine bitcoin, the standard 10 minute time to generate a bitcoin has fallen to 8 minutes 8 seconds, as per Bitinfocharts. In the second half of 2020, the block time has been kept between 12 to 8 minutes.

Overall, bulls haven’t lost yet, and they could further continue higher, especially if equity markets trade up given their correlation that continues to increase, currently above 57%.

“Recent BTC breakout was legit, but more effort needs to be coming from the bulls. Price action remains in a three-wave corrective move after bearish impulsion. Break of $11,740 & $12,500 Highs needs to commence, otherwise bears might try to force more consolidation/downside,” says one analyst.

Read Original/a>
Author: AnTy

Wrapped Bitcoin (WBTC) Beats Aave & Curve to Become the Third Largest DeFi Project

Bitcoin on Ethereum continues to grow at warp speed, reaching above $1.6 billion, on pace with 145k BTC.

Several projects like renBTC, imBTC, HBTC, TBTC, pBTC, and sBTC are putting BTC on the second largest network. Wrapped Bitcoin (WBTC) dominates this growth by accounting for 73.6% of the BTC on Ethereum.

105,132 WBTC worth $1.2 billion has been minted so far, which has increased a whopping 9,380% since the beginning of 2020.

With this, WBTC has jumped past the likes of Yearn.Finance, Synthetix, Compound, Curve Finance, and Aave to become the third-largest DeFi project.

Uniswap, with a record of $2.73 billion in total value locked (TVL) and dominance of 24.12%, and Maker with nearly $2 billion of crypto funds locked are the only ones bigger than Wrapped Bitcoin.

wbtc
Source: DeFiPulse

WBTC is one of the fastest-growing DeFi projects, much like the overall sector, which is hitting new highs of $11.4 billion in TVL.

Interestingly, yesterday, the largest WBTC was minted in a single day by CoinList. This largest mint of 5,000 WBTC was made in two separate transactions — the first one involved 1,299.48 WBTC while the second transaction involved 3,697.5 WBTC.

This record breaks the last one made by FTX CEO Sam Bakman-Fried’s crypto trading firm Almeda Research that one-upped the previous record with 2,316.5 WBTC.

WBTC is an ERC-20 token backed by bitcoin in a 1:1 ratio, where the BTC is held in the custody of BitGo.

With this, DeFi users can participate in various applications without actually using their Bitcoin. It further brings Bitcoin’s vast liquidity, with a $210 billion market, to the $42 billion market cap Ethereum network.

Demand for WBTC continues to soar, as seen in its growth as this allows Bitcoin holders to take part in exciting DeFi apps like yield farming and earn income on their BTC without giving it up.

Read Original/a>
Author: AnTy

Bitcoin Seeing New ‘Macro Bullish’ HODLers; Traders Call Out Short Term Sell-Off Before New High

Yesterday, we managed to get back above $10,800 before President Donald Trump sent the BTC price tumbling by announcing that he broke off the additional coronavirus relief fund negotiations with the Democrat.

Unsurprisingly, Bitcoin’s drop of 2% was in tandem with the equity market, which fell nearly 1.8%. But interestingly, it was gold that got hit the hardest, about 2.6%.

Markets are still wobbly, despite Trump backtracking, with altcoins continuing to drown in losses.

With notable losers including CREAM (24%), SWRV (20%), YFI (14%), SUSHI (13%), CRV (12%), and Aave (10%) DeFi tokens continue to bleed the most.

Micro Scenario

While the leading digital asset’s price remains subdued, bitcoin realized volatility has hit a three-year low at 20%.

image1

As we reported, this could result in a bout of volatility. Although network activity calls for bulls, bears can’t be called off altogether as the last time bitcoin realized volatility hit the lowest was right before the crash of November 2018 started.

“Bitcoin 30-day historic volatility has been falling fast and is in the ’20s. In the past, it has hit 20% vol 7 times. 6 times prices exploded higher immediately, and vol hit 80% in a few months. 1 time (Nov 2018) prices fell sharply. Either way, a big move is coming soon,” noted Raoul Pal of Real Vision Group.

Before BTC could jump higher in the near term, many are waiting for the price to take a dip first.

“I remain bearish for the time being. 10k support was tested, but lack of strength is apparent, price action is weak, no volume. breaking last low of $9,882 would likely trigger massive selling across the board. bearish until convinced otherwise by bull strength,” said Trader Crypto Yoda.

And while trader Loomdart is also looking for a downwards move, he doesn’t see BTC breaking the important $10,000 level before hitting the 2019 high of $14,000.

Macro Bullish

Amidst this, the coins on the spot exchanges are dropping, which is even more exaggerated with global exchanges.

According to on-chain analyst Willy Woo, this is “very macro bullish,” because “it’s a sign that new buyers are coming in to scoop coins off the markets and moving them into cold storage HODL, we are seeing new HODLers right now.”

image2

The analyst also points out how the 2017 bull market was fueled by the first scoop up of the coin at that time, which coincided with Wall Street Journal covering Bitcoin as a legitimate investment vehicle off the back of the Winklevoss ETF news. This time, the latest coins moving off the exchanges coincides with MicroStrategy buying Bitcoin.

Read Original/a>
Author: AnTy

Historically, Bitcoin Really Hates September; What Should Traders Expect?

Bitcoin has started September on a bad note.

The digital currency failed to keep above $12,000 and went down to almost $10,000 level on Wednesday.

This resulted in the market sentiments getting overturned fast, from “extreme greed” to “fear.”

Up 38% YTD, bitcoin is down about 50% from its all-time high of $20,000.

Yesterday, the market had relief as BTC stepped up to $10,645, which led investors to expect the weekend to bring good news for the market.

But the market is moving back down today.

At the time of writing, BTC/USD has been hovering around the key psychological level $10,000.

For a brief moment, the digital asset dropped under $10k to $9,975 on Bitstamp.

This isn’t a surprise for two reasons, one – dring the last bull market, bitcoin saw several, as much as nine, pullbacks of 30% to 40% on its way to the peak.

Second – this month isn’t good for bitcoin.

After March and January, September is the worst month for the leading cryptocurrency in terms of average log returns. Five out of seven times, this month has been a red one for Bitcoin and the other two times, it was barely in the green.

So, expectations for greens should be low in September while being prepared to grab the buy the dip opportunities.

The quarter fourth could bring the much-needed reprieve, filled with more green than red.

Historically, September isn’t bad just for bitcoin but also for the stock market.

As a matter of fact, the three leading indexes of the stock market have performed the poorest during the month of September, which got it dubbed as the “September Effect.”

It first happened in the late 1800s when the Dow Jones Industrial Average fell an average of 0.8%. And the S&P 500 has been dropping about 1% on average this month since 1950.

There is no plausible theory for this other than that these corrections are caused by tax-loss selling from mutual funds or pent-up suffering from investors who just returned from their summer vacations.

This time, however, lockdown due to coronavirus has people working and vacationing right at their home.

For stock markets, the fear doubles because of the election-related uncertainty. Reportedly, S&P 500 sheds 0.2% on average in the election year.

So, with bitcoin still being a risk-on asset, the stock market expecting more losses, and the month not being bullish for the digital assets either, pains could be ahead for the digital asset.

Read Original/a>
Author: AnTy

Crypto Market Dumps as Binance & Coinbase Crash While Bithumb Exchange is Seized

After a good start of September and the week that saw Bitcoin surging back above $12,000 and Ether making a new 2-year high, today it all turned red.

The markets suffered losses after the leading digital asset failed to sustain above $12k level and dropped to $11,155 today on Bitstamp. However, bitcoin has been slowly making its way upwards and is now back above $11,300.

Also, it hasn’t been anything that bitcoin didn’t see last month. In the first three weeks of August, bitcoin broke above $12,000 only to dump back down to about $11,000 level. So, bitcoin is just ranging.

“Nothing lost for the bulls yet, close above $11770 and I’d expect mega moon. Close significantly below and sells into the $11700 area become very attractive,” said analyst DonAlt. “Lose $11k and it’s macro pullback time, as long as it holds assume we’re gonna go further up.”

Altcoins meanwhile, reacted to bitcoin like always and the top cryptos are down between 6% to 10% except for Tron which is up a whopping 15% trading at $0.0358. Also, Tendies is still up 44.84% today.

Today’s biggest loser is Acute Angle Cloud, down by 90% with notable mentions including Ampleforth (42%), UMA (22%), TOMO (17%), Curve (16%), LOOM (15%), and Synthetix, Aave, Swipe, and OMG Network all down over 14%.

Taking Down Exchanges With it

As the market went down, so did the cryptocurrency exchanges.

Coinbase naturally crashed, as it has done numerous times whenever bitcoin moves just a bit fast in either direction.

Today, Binance also faced technical issues that have started to irk customers as the exchange has been experiencing a lot of overloading issues lately.

“Weird day. Pure coincidence, but definitely feel less lonely in a screwed up way. We are aware of some new choke points and have a plan to fix it quickly,” commented Binance CEO Changpeng Zhao (CZ) on both the exchanges going down in sync today.

Binance informed on Twitter that there has been “temporary difficulty accessing the website,” but assured the community that they are working on it. The exchange has also been having issues with ETH and ERC20 withdrawals due to traffic hitting ATH, ETH network congestion, and other unmentioned reasons.

“Things seem to be more calm now. Even our automated Chat Bot crashed due to overload earlier. So many places to improve on. Binance is still a young platform. Your understanding and support is much appreciated,” tweeted CZ.

But Not Because of an Exchange

Today, one of the biggest crypto exchanges of South Korea by trading volume of about $365 million, Bithumb’s headquarter was raided by the authorities related to a $25 million token sale that was hosted on the platform but didn’t materialize, as per the local reports. Reportedly, some investors lost millions participating in the sale of BAX tokens.

The company’s chairman Lee Jung-hoon is also under investigation for fraud, illicitly sending funds overseas, and escaping property.

It has been the second raid in just a week, as just last week, police seized another exchange, Coinbit, for faking its trading volume.

Bithumb’s raid reports came around the time BTC price crashed, leading many to speculate that it is the reason behind the price dump.

“Even though it’s possible some people may have sold some coin on the reports that @BithumbOfficial was raided by SK police, there isn’t any fundamental reason that such an event should push prices down,” said analyst Mati Greenspan.

“Bithumb seized is big news. But a levered market full of euphoric traders does not need a reason to dump,” noted trader and economist Alex Kruger.

Read Original/a>
Author: AnTy

Bitcoin & Gold Make An Inverted V on Fed’s Inflation Sacrifice; Stocks Roared Even Higher

The Federal Reserve will allow inflation to run above 10%, said Fed Chairman Jerome Powell during the much-awaited virtual speech from the central bank’s annual Jackson Hole, Wyoming symposium.

Bitcoin’s price responded to the news quite visibly, forming an inverted V, as the digital asset jumped from $11,290 to just above $11,600. But only to come back down under $11,400, so it was all for nothing.

The good thing is Bitcoin has lately been reacting to the macro events in line with other assets. The digital gold acted exactly like the precious metal as gold pumped over 2% only to retrace it whole within the next minutes.

The US stocks meanwhile opened higher — S&P 500 made a new all-time high at 3,494, the ever-rising Nasdaq went to $11,688, and the Dow Jones Industrial average also went higher but is still down about 2% from its peak hit in February.

“Yields are spiking, driving the dollar up and metals down, together with crypto. Financial stocks are roaring, helping indices stay up,” noted trader and economist Alex Kruger.

Source: @ClassicMarco

“Even more central bank stimulus: That’s what markets–across the board–have taken away, at least for now, from Fed Chair Powell’s remarks on changes to the Monetary Policy framework,” said Mohamed A. El-Erian, Chief Economic Adviser at Allianz.

This means everything that has already been going up will continue to go up.

However, tech stocks showed a weakness with Amazon, Facebook, Netflix, and Alphabet falling. Meanwhile, bank stocks moved higher.

The yields on benchmark 10-year Treasury notes dropped to 0.734% after the Fed said it would stop the practice of preemptively lifting interest rates to prevent inflation from rising.

The US dollar index, however, enjoyed the Fed’s dovish tone to make a strong rebound from 92.5 to over 93.

The chairman clarified that the “Fed will not hesitate to act if inflation rises above levels consistent” with its goal to support the labor market and broader economy. He also said that there is no particular method to define average inflation, moreover, “policy will not be dictated by any formula.”

“Many find it counterintuitive that the Fed would want to push up inflation,” Powell said in prepared remarks. “However, inflation that is persistently too low can pose serious risks to the economy.” And we need to support workers from the most affected sectors, he said.

Read Original/a>
Author: AnTy

Chinese Bitcoin Mining Farms Hit Hard by Floods, Hash Rate Crashes Across Mining Pools

  • Bitcoin hash rate is reaching new all-time highs as the price surges above $12,000 to a 13-month high.

The hash rate of the largest network had a rocky start to 2020, seeing a huge drop following the March price crash and then due to May 11th halving. But now it has fully recovered and even eclipsed the previous levels.

This means the fundamentals are bullish, and network security is stronger than ever.

Bitcoin miner revenue, which has become more dependent on trading fees following the halving, has also been growing. Thanks to the average trading fee rising from $0.81 to $2.31 post halving, miner revenue surged 7% in July.

Starting at nearly $16 million, bitcoin miner revenue rose to $19.8 million in mid-February, as per Blockchain.com. But a month later, this revenue crashed to $6.9 million due to the price crash. But before the halving, it climbed to over $20 million only for the reward halving to push it back around $7 million.

Now, in August, so far, miner revenue is keeping in the range of $13.7 million and $10.39 million, the lowest point of this month hit today.

Source: Blockchain.com

But with the price of Bitcoin back on an uptrend, things might get better for miners.

Soaring BTC prices and cheap electricity has been what is leading the hash rate to new all-time highs currently.

The 14-day mining hash rate has already climbed to a new all-time high of 127 Eh/s. This means the next difficulty adjustment, estimated to be positive 8%, within a week’s time could set a new record as well.

However, what has been pushing the electricity cost down is now leading to the drop of hash rate among major Chinese bitcoin mining pools.

The monsoon season in China brings abundant rain leading to cheap electricity prices. In the Sichuan province, which is estimated to account for more than 50% of Bitcoin’s total computational power, heavy rainfall is now affecting the operations. Molly, the head of marketing at HashKey Hub noted,

“The heavy rainfall in Sichuan is continually getting worse, caused internet blackout in multiple places in Sichuan, might cause bitcoin hashrate drop temporarily since over 70% of mining farms in Sichuan.”

And the hash rate has dropped significantly as per data from BTC.com, between 10% to 20% as bitcoin mining farms in the region are forced to unplug.

Bitcoin Block Explorer - BTC com
Source: BTC.com

One of the largest bitcoin mining pools, Poolin, shared several videos of the mining farm located in the Sichuan region being hit hard by the floods.

The three-day hash rate has already dropped 3% to about 123 Rh/s, and the one-day average fell 10% to 110 Eh/s.

Read Original/a>
Author: AnTy

Third Time’s the Charm? Bitcoin Breaks Above $12k; Top Altcoins Coming Out of Hibernation

Bitcoin has broken above $12,000 today to hit $12,222 on Bitfinex. This has been the third time this month and is to be seen if we will be able to sustain this level.

On CME, bitcoin futures are trading about 1% higher.

Today, the market is experiencing a green day that has Binance going down. The community wasn’t happy, one trader quipped, “just add some more financial instruments to the site, that will work.”

The largest digital asset has been making good progress in 2020 with altcoins enjoying the bulls too. But trader and economist Alex Kruger says a sharp reversal here would be very bad for altcoins.

“Leverage in many alts is now sky high. BTC still in a measured uptrend within a positive macro environment. A good path to cleanse excesses would be a sharp break and V-reversal at 12K. If that happens, alts should puke,” he said.

coin360-8-17
Source: Coin360.com

Among the top cryptocurrencies, LINK is the biggest gainer that has been hitting new highs every other day.

The likes of Cardano (ADA) and Tezos (XTZ) have been able to see gains as well, with the later looking to be “on similar market structure” as Chainlink (LINK).

Ether started leading the market after it gained momentum last week.

Now looks like the gains are spilling into other top altcoins as total market cap adds over $6 billion today.

“ETH has recently broken out from its Bull Flag. Since then, money has been flowing into other Large Caps as well. Here are three Majors with identical market structures, in various stages of their breakouts,” noted analyst Rekt capital.

LTC, BCH, and EOS all three have been breaking out.

With 25% gains, Litecoin has finally recorded some greens. LTC has been slowly sliding down as other coins took its place.

The 8th largest cryptocurrency by market cap of $4.2 billion is now trading at $64.4 on the back of increasing volume but still down 84% from its ATH.

According to TraderX0X0, if bitcoin lets it, Litecoin can see a 50% pump too early 2020 highs.

Litecoin creator Charlie Lee, who is infamous for selling his LTC stash at the top, took to Twitter to point out that “Litecoin SegWit usage has reached 80%, whereas Bitcoin is only at 50%,” for which Blockchain.com not implementing SegWit is the primary cause.

Bitcoin Cash and EOS meanwhile are up only by 46% and 44% YTD while being down 92% and 83% from their ATH, respectively.

Even Justin Sun’s Tron (TRX) has been enjoying the gains lately, hitting a 52-week high over the weekend, up 30%.

Interestingly, XRP, still down 92% from its peak, is also recording greens today of 5.63% to move back above $0.30.

XRP’s competitor Stellar Lumens (XLM) is trending up even harder, with 9.12% gains trading at $0.115.

Other notable gainers include OMG (22%), YFI (20%), 0x (14%), REN (13%), and STEEM (11%). Meanwhile, BTT, NEO, and NEM all are up about 8%.

Read Original/a>
Author: AnTy

These Top Coins Including XRP Have Finally Started Moving

Bitcoin is enjoying a ride with the price now above $11,000. For the first time, the largest digital asset has broken its long-standing trendline resistance that dates back to mid-December 2017.

Even Bitcoin dominance has started to recover, which isn’t good for altcoins that have been enjoying a rally for the past few weeks, although a handful of small-cap cryptos are still enjoying gains.

But bitcoin uptrending is not the only reason why altcoins are moving in the opposite direction to the largest digital asset. CMS PRIME shares,

“The biggest and most important is people were overweight alts and under weight btc.”

Moreover, there was a “sudden need” for margin as positions get stretched and under collateralized positions get shocked. Bitcoin is also the reserve currency, so people have to sell and get collateral in.

“In short altszn bred complacency in btc and then a mad dash to catch up,” and the same is true in reverse.

Breaking Out

Although some of the best performing altcoins like Chainlink (LINK), Tezos (XTZ), VeChain (VET), Ampleforth (AMPL), Aave (LEND), Kyber Network (KNC), Balancer (BAL), and many others recording losses in the past week, some of the top cryptocurrencies started making gains this week.

Bitcoin’s run-up even managed to push Litecoin into the green, resulting in the digital asset breaking out of its multi-month accumulation range. The 8th largest cryptocurrency would soon revisit its long-standing downtrend trendline resistance dating back to mid-Dec. 2017 on breaking of which, “LTC could enjoy a new bull trend.” Analyst Rekt Capital said,

“LTC will soon approach its own trendline resistance, dating back to mid-December 2017. It’s difficult to think that LTC won’t follow BTC & fail to break it.”

Other bad performers recording gains this week include Bitcoin Cash, which is up 27% this past week, BSV 23%, and EOS 20%.

The third-largest cryptocurrency XRP also finally made some moves. This digital asset is still down 94% from its all-time high but jumped nearly 22% this past week, and is currently trading at $0.24.

These gains came amidst the news that Ripple partner Japan’s SBI Holdings is using R2’s enterprise blockchain Corda to issue its new S coin. In other news, Ripple announced the launch of Payburner, a P2P payment platform based on XRP.

Ripple CTO David Schwartz also shared in a recent interview why they decided not to build smart contracts into the XRP Ledger. He said,

“We were right that adding smart contracts makes a platform worse for payments. And we were right that it would introduce fee instability, performance issues, and have lots of attack surface.”

“Ethereum was wildly successful and for good reasons.”

Read Original/a>
Author: AnTy