Bitcoin Miner Fees Jumps a Whopping 196% YTD while Indicators Turning Bullish

  • Bitcoin price and volume is down while volatility jumps above 9%
  • Long-term velocity turned bullish while MVRV Z-Score indicates market bottom

It’s just another day in the crypto market with Bitcoin down 6.36% trading at $6,225. The market doesn’t seem to decide on where it wants to head right now, as the market records double-digit percent changes in both the directions.

The crypto market started climbing this week after the stock markets found a temporary bottom. Given that cryptocurrencies are acting like risky assets in line with stock markets, it’s no surprise that the momentum has been positive throughout this week.

But the 7-day average real trading volume has dropped down after the volatile period for the past two weeks but still higher than the average recorded earlier in 2020. And increasing prices on decreasing volume is usually a bearish signal.

The 30-day volatility for the BTC price that has been extreme these days meanwhile has jumped above 9%. As Arcane Research notes, “with the global turmoil and volatile stock markets, it doesn’t look like the bitcoin price movements will settle down either.”

The rise in BTC’s price has the world’s top cryptocurrency leading the way with an increase in its dominance. While Bitcoin is closing up on Small Caps ahead of both Large and Mid Cap crypto indexes, Mid Caps continue to be the worst performer, down 34% this month.

However, despite the price boost, bitcoin is up 70% from its $3,850 bottom, the market sentiments are still reflecting “extreme fear” in the market with the Fear & Greed Index having a reading of 14. The last time the market stayed in “Extreme Fear” this long was in December 2018.

The Bitcoin Network

As we reported, mining difficulty for bitcoin declined by almost 16%, which has been the second biggest drop in its history. The largest drop was on October 31, 2011, of 18.03%. The network difficulty adjusts every 2016 block or 2 weeks in order to ensure that the network continues to mine new blocks every 10 minutes.

This decline came on the back of a drop in the hash rate following the crash in price two weeks ago. This decline indicates that fewer miners are competing to solve the math problem to mine the block and win freshly minted BTC.

Mining fees meanwhile jumped 47.8% since last month and a whopping 196% YTD, as per Glassnode.

Amidst this, the bullish metric is a long-term velocity that measures the speed at which bitcoin is moved through the network. A velocity of 600% means, active coins move six times per year and it has yet again turned bullish last week after being below 600% since August 2019.

Yet another bullish indicator is MVRV Z-Score which is used to assess when Bitcoin is under or overvalued relative to its fair value. It dropped under and then promptly bounced back over 0 in a space of two weeks and “historically, falling into the green zone has indicated market bottoms.”

Latest Bitcoin Price News and Crypto Market Updates

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Author: AnTy

23k BTC on CME Futures and 50k BTC in Options Expiring Today

Bitcoin is currently down 0.05% in the past 24 hours trading around $6,640 after hitting $6,872 last night, yet again rejected at $7,000 level. Interestingly, more than 340,000 addresses are holding about 236k BTC at about $7k level.

According to trader Nebraskan Gooner, the crypto asset is working in a tight range. A daily close above $6,750 he said “would surely” take us above $7,000 while the close below $6,400 means, falling to $5900 and even $5200.

Bitcoin has also printed a death cross, which indicates a potential for major sell-off. This technical chart pattern has been a reliable indicator of some of the most severe bear markets in the traditional markets which is now seen in bitcoin.

But bitcoin volatility could see a further hike as futures contracts on CME and options expire today.

Activity on CME has been declining ever since February when the price of Bitcoin was trading around $10,500. Crypto data provider TradeBlock, noted,

“March bitcoin futures trading volume at the CME declined despite elevated volatility in spot markets for the month. While the CME’s bitcoin futures product saw record volumes in January and February, March activity has fallen considerably.”

Source: @TradeBlock

As for today’s futures contract expiration, Bitcoin futures on regulated exchange CME has about 23,000 BTC worth over $150 million in open interest for March 27th contracts.

Besides bitcoin futures, options are also expiring today. About 50,000 BTC options worth about $330 million are outstanding on crypto exchanges, out of which $50 million are in open interest on March 27th expiry on Deribit.

“For reference, the Deribit Exchange open interest on options last year was half the value of open interest that is present on exchange now. ($300m -> $600m). The same case for BitMEX March 27th futures,” noted Trajan.

Skew-Total-BTC-Options-Open-Interest
Source: Skew.com

According to Su Zhu, CEO of Three Arrows Capital this quarter is “very important” to watch. It is expected that the expiry of Bitcoin futures and options would result in heightened volatility.

Zhu further noted, “Last yr market bounced quite aggressively from backwardation to contango after the expiry.”

Backwardation is when the spot price of an underlying asset is higher than the futures price while Contango is when the price of a commodity is higher in the futures market than the current price of the commodity. Now it’s to be seen if we will see the same scenario happening this time as well.

Backwardation is happening in both gold and bitcoin which Zhu said could be because “mkt has re-learned fear and is showing preference for owning actual assets vs owning derivatives of those assets.”

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Author: AnTy

Galaxy Digital’s Novogratz Remains Bullish as Ever on BTC: “This is the Time for Bitcoin”

The price of Bitcoin has surged 74% from the low the digital currency put on March 12. However, we are still down 36% from 2020 high of about $10,500. But according to billionaire investor Mike Novogratz instead of panicking, this should be taken as a buy the dip opportunity.

In a recent interview with CNBC, the Galaxy Digital Holdings’ CEO said, “If there was ever a time — debasement of fiat currencies, monetization of trillions of dollars of debt, this is the time for Bitcoin.”

The bitcoin bull predicted on Tuesday that the world’s leading cryptocurrency would rally this year as it was designed after the 2008 financial crisis to be an alternative when central banks “run amok.”

In recent weeks, we saw central banks around the world announcing trillions of dollars in stimulus to pump in the financial markets and promising every step necessary to combat the impact of coronavirus on their economies.

“It needs to rally this year,” said Novogratz. “If at the end of the year Bitcoin’s not a lot higher, I’m going to scratch my head and say, ‘Look, what the heck is going on?’”

Bitcoin Looking Promising

Currently, BTC/USD is trading under $6,700 after surging to $6,990 after the $2 trillion stimulus coronavirus bill was passed. The move yet again followed the stock market. Yesterday, the Dow Industrial Average had its historic rise only today to swing between gains and losses.

Meanwhile, one technical indicator, GTI VERA Convergence Divergence is flashing a buy signal. Moreover, according to Christel Quek, co-founder of Bolt Global,

“It could be very likely that traditional investors are seeking to regain liquidity through profit hunting from crypto assets as equities are negative worldwide.”

However, in the short-term, in the next 1 to 2 months, economist and trader Alex Kruger sees everything from equities, their volatility, bitcoin if it remains risk-on, and crude oil to be lower.

It’s worth noting, in less than two months, Bitcoin will experience its third reward halving that would cut down miners block rewards while the cost of mining bitcoin will surge between $12000 to $15,000.

In the next six months, the economist sees equities and gold higher while his 12 months’ view is everything from equities, its volatility, gold to bitcoin going higher. But the main risk he said is if the equities’ bottom is in because of the rising coronavirus cases and the period of lockdown in the US.

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Author: AnTy

One Altcoin Is Pumping Amidst the Red Crypto Market

March has been a rollercoaster in the cryptocurrency market. After crashing down hard last week, the market is finally picking up speed again.

Small-cap cryptos are actually the ones leading the market, now only down 23% in March having bounced off of the lows from last week. Last Friday, the small-cap index was down over 40%, only to make a strong recovery.

One of the very few crypto assets that are currently in the green in the crypto market that has yet again turned red is Dash.

Source: Coin360

The 18th largest cryptocurrency by market cap of $670 million is currently trading at $70.22 with 24 hours gains of 4.12%. Earlier this week, the digital asset went down to $39.80 but is up 48.80% in the past 7 days. During the past week, the digital asset jumped 30% against BTC and over 44% in the ETH market.

Up over 62% so far in 2020, Dash, however, is down 96% from its all-time high of $1,726 hit in January 2018 during the bull run.

The digital asset has also started to record an uptick on its blockchain. Recently, 614.72k DASH was transacted on-chain recently.

Active addresses that fell to 42.6k at the beginning of the second week of March bounced to 181k earlier this week and are currently around 76.5k.

New addresses created have also risen to 83.2k while the number of addresses in the money increased from 19% to 23%, noted crypto analysis company IntoTheBlock.

The most important update has been the release of v0.11. The new Dash Platform release os the testing environment for platform functionality with a significant update to Evonet. Other updates Include register public data contracts, DAPI now works in web browsers, distribution package for local development and Evonet, insecure endpoints have been removed, and updated Dash core to v0.15.

Besides Dash, in the past 24 hours, Zcash is also up 1.21% while Enjin Coinis barely in the green. Top altcoins meanwhile are struggling with Ethereum and XRP down 7.44% and 6.77% respectively.

Small cap coins like Curecoin up 54.81%, Bluezelle 32.69%, Blockmason 25.77% are experiencing gains. However, these coins have extremely low volume, some having as low as $1,500.

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Author: AnTy

Bitcoin Miners Are Shutting Off their Rigs as Hash Rate Drops 28% from ATH

  • Trading volume hit new highs on sell-off
  • Bitcoin hash rate down 28% from ATH on March 1st at 136.2 Th/s to below 100 Th/s
  • Bitcoin mining difficulty preparing for a negative 6.5% to 9.1% change
  • Mining profitability falls to its all-time low of 0.077

The price of Bitcoin is keeping stable at around $5,000, currently trading at $5,325 with 24 hours gains of 5.79%. In the past 24 hours, $1.75 billion worth of bitcoin exchanged hands.

The trading volume of the digital currency reached near record highs amidst the deep sell-off last week. On March 12th, bitcoin trading volume soared to a two year high with more than 416,000 BTC changing hands.

The high beat the second-highest day occurred on November 20, 2019, when bitcoin just like the past week, experienced a sudden, deep sell-off.

Source: @TradeBlock

Hash Rate Drops

The bitcoin price went down to as low as $3,850, last recorded in March 2019. The hash rate of the network at that time didn’t falter but finally, the effects could be seen on the hash rate — the computation power to mine BTC. Bitcoin mining pool F2Pool said,

The hash rate of the network is currently down over 28% from the all-time high on March 1st at 136.2 Th/s to back below 100 Th/s, as per data analytics firm Blockchain.com.

Bitcoin miners, particularly in China have started to feel the brunt of the BTC price crash. According to data from F2Pool, a majority of the mining pools have recorded a drop in hash rate. F2Pool tweeted on March 12,

Crypto exchange Huobi’s mining pool experienced a drop of 26% over the past week with 1THash close behind with a loss of 20%. Meanwhile, the bigger pools like Pooling, F2Pool, and Btc.com saw a decline of only 18%, 12%, and 10%.

The bitcoin mining difficulty that has been surging in line with the hash rate and has yet to see a decline is preparing for a negative 6.5% to 9.1% change in the difficulty in the next 8 days. F2Pool said,

Bitcoin mining profitability at a record low

Bitcoin mining profitability has already taken a hit. Less than two months away from reward halving, mining profitability has fallen to its all-time low of 0.077.

With revenues gone flat and a 100% increase in costs, miners will feel the pinch right now which would result in an increase in block times and fees as “transactions compete for space in the chain,” said James Bennett, CEO of crypto data analysis firm ByteTree.

At this point, even the most efficient mining equipment like Bitmain’s AntMiner S17 Pro and WhatsMiner M20S of MicroBT are generating daily profits at a gross margin below 50%.

Now, come halving which will reduce miner revenue by half, if the price of bitcoin doesn’t bounce back higher, miners will capitulate. Christopher Bendiksen, Head of Research at Coin Shares said,

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Author: AnTy

Bill Gates Steps Down from Microsoft’s Board; Commits $1.4M to Blockchain Project CREST

  • Microsoft Co-founder, Bill Gates, is stepping down from the company’s board according to a press release on March 13.
  • The veteran IT mogul will focus on his philanthropic initiatives which include tackling climate change, global health, and education.
  • Bill Gates will still, however, advise Microsoft’s CEO, Satya Nadella and other directors within the company in matters technology.

This transition has been gradual and began when Gates opted out of a day to day role at Microsoft back in 2008. At the time, he was looking to focus on the Bill & Melinda Gates foundation and would later step down from being Microsoft’s board chairman in early 2014.

Nadella highlighted that Microsoft was grateful for the contribution by Gates since he founded the company in 1975;

“It’s been a tremendous honor and privilege to have worked with and learned from Bill over the years. Bill founded our company with a belief in the democratizing force of software and a passion to solve society’s most pressing challenges.”

Given the developments around the distributed ledger tech, Microsoft and its founder have since indulged in blockchain-based projects to provide solutions.

Microsoft’s and Bill Gates Support for Blockchain

Notably, Microsoft has been active in the blockchain development space especially through its cloud platform, Azure. Towards the end of 2019, the firm launched a blockchain-oriented ecosystem that allows interested developers to leverage building tools for distributed networks.

Bill Gates has also been directly involved in this industry; the Microsoft co-founder recently supported a blockchain initiative meant to scale activity in Africa and Asia. This project dubbed ‘Crest’ was funded to a tune of $1.4 million at the beginning of March and is set to use the proceeds for scaling financial services to the unbanked.

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Author: Edwin Munyui

CME Suspends Trading Floor As Bitcoin (BTC) Price Plummets To 11-Month Low

  • Chicago Mercantile Exchange (CME), a Bitcoin futures platform, will shut down its trading floor in response to the growing Corona Virus (COVID-19) epidemic.
  • Bitcoin (BTC) dropped over 30% on Thursday as the market embraces the global asset bloodbath from the virus.

Corona Virus has taken the headlines across the globe as firms and economies suffer from the pandemic. While the cryptocurrency market has remained comparatively immune for the past few weeks as other global assets tanked, the market is finally catching a cold as CME announced the closure of its BTC Futures at the end of day on March 13.

Notwithstanding, the price of BTC has tanked to April 2019 levels after a $1,800 USD drop in price at 10.00 AM GMT on Thursday. Will the cryptocurrency market survive the global epidemic and reverse the ultra-bearish trend?

CME set to close trading floor in Chicago

In an announcement from CME, the second company to offer regulated BTC futures in the U.S, trading on the platform will be suspended starting Friday, 13th March at the close of business. The derivative exchange said the move to shut down its trading offices in Chicago is a precautionary move to the increasing cases of COVID-19 virus across the U.S and the world.

Trading will continue normally on CME Globex, with the company only aiming to reduce the large gatherings of people in accordance with medics recommendations. The statement further reads,

“No coronavirus cases have been reported on the trading floor or in the Chicago Board of Trade building. The reopening of the trading floor will be evaluated as more medical guidance on the coronavirus becomes available.”

The Corona Virus effect on Bitcoin?

After CME’s announcement of the closure of its offices come Friday the 13th, BTC’s price has dipped to 11-month lows at $5,600 USD. After a period of immunity against the global pressures that saw the price of stocks plummet and oil price wars by Russia and Saudi Arabia, crypto is finally catching on following the bearish trend.

Currently, a number of crypto firms have tried to mitigate the Coronavirus problem offering work of home assignments, such as Coinbase, Gemini and Blockstack. However, the market looks headed to a crash below the $5,000 mark as fears rise across the investor pool.

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Author: Lujan Odera

Ethereum Price Crashes 13%; Co-founder Vitalik Buterin Sees ‘Increased Network Privacy’ Coming

As the Bitcoin price took a hit, so did the price of altcoins. Ethereum is down about 13% trading at $216 while managing the trading volume of $487 million on the top ten exchanges with real volume.

“ETH on the daily level around $228-229. It looks very bad. Losing it and I’d be aiming for $211 and probably $195 mainly,” said trader Crypto Michael.

Interestingly, crypto exchanges hold 31 million ETH in comparison to just under less than 3 million ETH locked in DeFi. The vast majority of these ETH held in exchange wallets is in centralized exchanges, with Coinbase, Huobi, Bitfinex, Binance, and Kraken holding the most.

Binance particularly hit its first 1 million ETH right at the crypto peak of Jan. 2018. Because Binance usually provides just one address per retail customer, the exchange saw the “largest influx” of customers around Jan. 2018. This means, the growth Binance saw in the last 18 months has likely been from the existing customers and non-Ethereum crypto assets, points out Alex Svanevik, co-founder at D5.

Network activity growth

The amount of unique ETH transferred on the network improved in February, indicating an uptick in total value transferred on the network, finds Maksim Balashevich, founder of Sentiment.

Meanwhile, a total of $3.39 billion worth of transactions took place on Ethereum in January but in Feb it remained below this number.

The total amount of gas used on the Ethereum took a sudden and significant dip last month following the drop in price. As such, the cumulative fees needed to successfully conduct a transaction on a contract on the network have been nearly at 6 months low.

However, the difference in token circulation in Feb. vs. Jan., there was a “modest” 1.2% increase that “should serve as a confidence booster to those expecting network activity growth, as it shows unique coins continuing to move between addresses.” Despite ETH’s price performance, the token circulation maintained its pace up close to 6-months high levels.

Debating ProgPow

A few days back, the Ethereum All Core devs had a call to decide on ProgPow that lasted 3 hours. Kristy Leigh-Minehan, one of ProgPow’s creators pointed out how it is easy to fix, follows a fast approach to tackle the issue, and is only exploitable under specialized scenarios.

The opponents, however, pointed out the vulnerabilities that highlight the inherent risk of changing the mining algorithm.

The potential of a sudden drop in the Ethereum hash rate was also discussed. Regardless of the algorithm active, GPUs with RAM of 4 Gigabytes and E3 miners of Bitmain (which makes for an estimated 40% of Ethereum’s hash rate) will be affected around April.

“With ProgPow it’s not clear to me why ASIC resistance would be a good thing,” and as such the change should not be made, argued anti-ProgPow Gnosis Co-founder Martin Köppelmann.

While Ameen Soleimani, CEO of Spankchain said it doesn’t make sense to deploy resources to changing Proof-of-Work when soon the network will transition to Proof-of-Stake.

“It’s a bunch of profit-seeking miners lobbying the Core Dev Political Committee to get what they want. Full stop,” he attacked the other side.

But Ethereum 2.0 being at least two years away still and 1.0 chain needs to be maintained functional. Ethereum founder Vitalik Buterin who was also present at the call did not share his views on the ProgPow.

However, in another event ETHLondonUK, Buterin shared that sharding will scale the network “somewhere between a factor of a hundred and a few hundred.” The next year, Buterin also sees Ethereum ecosystem having “increased privacy.”

“There’s definitely an ever-growing realization of the need to not have all of your activity be publicly linkable to all of your other activity,” said Buterin.

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Author: AnTy

Vitalik Buterin Calls Popular Bitcoin Stock-to-Flow (S2F) Model “Rationalized bulls—t” Vitalik Buterin Calls Popular Bitcoin Stock-to-Flow (S2F) Model “Rationalized bulls—t”

  • “Event X (including stock-to-flow model) will make crypto go (up | down) are post-hoc rationalized bullshit,” – Ethereum co-founder Vitalik Buterin
  • “The proven cointegration is still there everybody can verify it, until you prove it wrong” – PlanB who uses S2F model to determine BTC value
  • Last week, Trezor also posed a question on the model saying “using Stock-to-Flow to predict prices is absolute nonsense”

Ethereum co-founder Vitalik Buterin dissed the stock-to-flow model that puts bitcoin’s value at above $100k before Dec. 2021 based on its scarcity. According to this model, the reward halving in May 2020 will make the digital asset more scarce than gold.

Buterin took to Twitter on Thursday to comment,

“Your daily reminder that 95%+ of articles of the form “event X will make crypto go (up | down)” are post-hoc rationalized bullshit.”

In response to this, analyst PlanB, who first used this model to determine bitcoin value said,

“You can call stock-to-flow model rationalized bulls**t or absolute nonsense but that’s not how math/stats works: the proven cointegration is still there, everybody can verify it, until you prove it wrong. But I get Vitalik: liking S2F = saying ETH has no value, ofc he is a critic”

Bitcoin price has been following the Stock-to-flow model over its past 10-year journey even the ongoing crash below $8,500 has been “spot on model value”.

Using Stock-to-Flow to predict prices is absolute nonsense

Buterin is not alone in criticizing the model, many analysts have done so. The most recent one has been by crypto hardware wallet manufacturer Trezor.

Although mathematically the model looked “convincing” and the idea behind it was impressive, “using Stock-to-Flow to predict prices is absolute nonsense,” states the blog.

It argues that the price is the result of supply and demand. But the stock-to-flow model only takes the supply side into account. “If the demand for Bitcoin falls, the price will drop even at the same Stock-to-Flow.”

The article illustrates Bitcoin fork Bitcoin Cash for which the model doesn’t work because there isn’t any demand for it.

“If we knew Bitcoin had to moon because of the magical Stock-to-Flow and shoot up ten times with every halving, why aren’t we there yet?” The blog further argued that the model puts bitcoin value higher than the GDP of all countries in the world in a few decades. And sometime in future, an infinite value, “then a negative price of Bitcoin.”

The analyst PlanB has previously called that phase to be hyperbitconization when the dollar would fail to be used to measure bitcoin value. Trezor said,

“Scarcity is a necessary but not sufficient condition of value. The Stock-to-Flow model correctly draws attention to scarcity but omits the second necessary variable from the equation. As a result, it is unusable to predict the price and remains just a wish of all Bitcoin fans.”

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Author: AnTy

Contents Protocol Refunds $8M ICO, Shuts Down Due To Crypto’s Negative Perceptions

Content-sharing platform, Contents Protocol has announced on Wednesday that is shutting down and will refund investors the $7.5 million worth of Ether (ETH) that were raised in the initial coin offering (ICO). Here’s what the Contents Protocol announcement from the official website reads:

“We inform you that due to continued regulatory uncertainties in cryptocurrency and lack of business prospects, we have decided to end our project.”

A WATCHA Play Subsidiary

Contents Protocol became an ICO market player later, completing its crowd sale in December 2018. As a subsidiary of the Korean streaming service WATCHA Play, it was designed for incentivizing content sharing by offering its reviewers of show and films rewards in its native token, the CPT. However, it had to shut down, explaining that it had too few users because people have a negative perception when it comes to cryptocurrencies. It also said that it doesn’t expect the anti-crypto attitudes to change very soon either.

$7.5 Million Worth of Assets Converted Back into ETH

In its public and private ICOs from 2018, Contents Protocol managed to raise 29,333 ETH (worth $8.1 million). The remaining assets, valued at about $7.5 million, have been converted back into ETH after the shutdown, remaining to be redistributed to investors who made requests for refunds. The company said the collected CPTs are going to be destroyed as soon as the liquidation process begins, so the users holding the tokens will be able to exchange them at the $0.002 worth of ETH until then.

According to the asset records provided by the firm, about 3,800 ETH were exchanged into $1.45 million for funding business operations. While a part of the funds has been converted into Bitcoin (BTC), most of the assets remained in Ethereum (ETH).

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Author: Oana Ularu