Bitcoin Takes A Dive & Altcoins’ Drop Hard, But People Are Still ‘HODLing and Not Selling’

BTC price goes down to about $55,600 and Ether as low as $1,930 as 366,073 traders get liquidated for $2.02 billion. But the crypto market is already recovering the losses.

Historically, April is one of the best months for Bitcoin’s price, however, the beginning of the month is anything but so.

Today, the price of Bitcoin took a fall to $55,600 and is still not looking done with the correction. In tandem with BTC, the majority of the cryptocurrency market has gone down with it too, which has been enjoying an onslaught of bulls while the leading cryptocurrency consolidated.

Down 5% to 20%, Ether is back at $1,945, XRP near $0.880 with FIL, UNI, DOT, XLM, TRX, BTT, IOTA, BSV, AAVE, XTZ, ATOM, KSM, ENJ, STX, DENT, and UMA recording double-digit losses.

As a result, the total market cap, which surged past $2 trillion for the first time this week, is now near $1.90 trillion.

However, the market hasn’t topped as Ki-Young Ju, CEO of data provider CryptoQuant, points out people are holding and not selling their BTC.

“Are we in the market cycle high? No. When the market reaches its peak, everyone deposits BTC to exchanges to sell. The number of inflow addresses across all exchanges was at its highest in 2018 Jan, while it hit a three-year low a few days ago.”

And bitcoin shorts continue to be punished.

Overeager and overleveraged longs, however, aren’t unaffected. As a matter of fact, the degen traders are the reason Bitcoin sees pullbacks time and again.

In the past 24 hours, over $613 million Bitcoin positions have been liquidated, as per Bybt. In total, 366,073 traders have been liquidated for $2.02 billion.

Following this, funding rates on Bitcoin perpetual contracts have gone down some, with the highest on Huobi at 0.1051%.

Long Bitcoin, Short U.S. 5 Year Treasury

In other news, Bitcoin bull Mike Novogratz is shorting the five-year Treasury as a hedge against policymakers pulling back their monetary support, saying, “Everyone long bitcoin should be short the five year.”

“I’m short a lot of interest rates,” Novogratz, chief executive officer of Galaxy Digital, said in a Bloomberg Television interview.

“To me, being short the five-year part of the yield curve is a great hedge for any portfolio, crypto or non-crypto.”

U.S. 5 Year Treasury yield is currently at 0.866%, down from 0.97% last week. The yields on these bonds have been rising since last August when it was at 0.193% but still nowhere near the 9.52% in late 1988.

The billionaire investor, who is a former partner at Goldman Sachs, further said in the interview that the price of the assets is rising for the very same reason, central banks relentlessly printing money.

This week, the total cryptocurrency market capitalization hit a new all-time high above $2 trillion, and according to Novogratz, we can easily rise twice as much this year.

“We’re up to 0.5% of global wealth in crypto, and it will be 1% by the end of the year.”

While bullish on crypto and short on bonds, Novogratz is also betting on Facebook in anticipation of the social media giant introducing the Novi digital wallet this quarter. “All of a sudden, you’ll have 2.4 billion people connected to this crypto space,” he said.

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Author: AnTy

Hedging on Fears: New Crypto Volatility Index Let Traders Bet on Market Turbulence

Hedging on Fears: New Crypto Volatility Index Let Traders Bet on Market Turbulence

Over the years, since Crypto investing became more mainstream, we have seen the creation of futures contracts, funds, and now Volatility indices.

The Blockchain-powered Fintech startup company, COTI, has announced the launch of a brand new cryptocurrency index, which allows traders to bet on the likelihood of shorter/longer-term market volatility. At this stage, traders are able to open positions by depositing and using the Tether stablecoin (USDT).

With the popularity of indices like futures, which allow investors to bet against a digital asset’s long-term performance, the introduction of a volatility index shouldn’t be so surprising. The Gibraltar-based company explained that “Users who expect volatility to increase can open a CVI position. If correct, they can take profit by selling their position once the index has risen.” However, if traders correctly anticipate low volatility, they can profit by collecting fees from other traders that opened positions.

In a sense, COTI helps to bring more liquidity to the crypto market.

To avoid overly febrile activity on the platform, CVI liquidity providers will need to deposit and hold USDT for at least 72 hours. Once any position is opened, a CVI trader must keep it open for 6 hours before it can be closed or sold.

For the moment, aspiring traders can link to COTI’s CVI through major wallets such as MetaMask and TrustWallet. COTI intends to add digital assets like Ethereum (ETH) and its native COTI Token in the future.

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Author: James Fox

Huobi Global Partners With BCB Group; Traders Gain Access to European Fiat On-Ramp

Huobi Global Partners With BCB Group; Traders Gain Access to European Fiat On-Ramp

Crypto exchange giant Huobi Global has announced a new partnership with BCB Group in efforts to link its trading desks to the European banking system, including the United Kingdom.

Seychelles registered crypto exchange will now offer instant euro and GBP settlements to its clientele.

The deal, which was announced on Tuesday, reveals that Huobi’s over-the-counter (OTC) customers can now complete transactions instantly using either the pound (GBP) or euros through BCB’s BLINC network.

In the recent past, crypto exchanges have faced different hurdles in their efforts to establish banking relationships that can provide an interface to the fiat money world. Before the current deal, Huobi had no established European fiat gateway, BCB CEO Oliver von Landsberg-Sadie stated.

Speaking to media outlets, Landsberg-Sadie stated that the partnership would provide a robust infrastructure that will enable seamless trading for Huobi’s customers.

“We’re here to provide that robust infrastructure so that these guys can just get on with trading and know that trades are happening in a way that’s properly monitored, that’s regulatory-friendly.”

Huobi’s head of global business, Ciara Sun, stated that the process has been rigorous and although it took some time it is for the benefit of the firm’s European customers. Sun said,

“Partnering with BCB allows us to offer a European fiat on- and off-ramping service that we know is in line with the laws of that area, but it also allows our customers in Europe to experience a smooth and hassle-free user experience.”

Huobi becomes the latest major crypto exchange using BCB’s BLINC platform, following Bitstamp, which had joined earlier. BCB stated that other partnerships with various crypto exchanges would be announced soon.

Huobi Korea Secures Certification From Korea Internet and Security Agency

Huobi Korea, an offshoot of Huobi Global operating in Seoul, has been certified as an information security management system, or ISMS. The certification complies with Korea’s Special Payment Act.

The certification means that Huobi Korea will be granted a broad management system that guarantees security as well as compliance with Korean laws. The new law requires crypto-based enterprises to report transactions as per the updated KYC and AML policies issued recently.

Huobi Korea CEO, Park Si-deok, said that the issuance of the certificate is a testament that the exchange is well prepared to offer quality services to both institutional and individual clients.

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Author: Joseph Kibe

UK’s FCA New Law Prohibiting Sale of Crypto Derivatives to Retail Traders Takes Effect

UK’s FCA New Law Prohibiting Sale of Crypto Derivatives to Retail Traders Takes Effect

  • The U.K Financial Conduct Authority (FCA) law prohibiting the sale of crypto derivatives products to retail investors comes into effect today. The law has raised divided opinions across the crypto players claiming the law will send retail investors to unregulated exchanges.

In October 2020, the FCA introduced a new set of crypto laws to govern the sale of derivatives on these assets, – which have become effective as of January 6th, 2021. According to the law, cryptocurrency service providers are prohibited from selling, marketing, and distributing crypto-related investment products to retail customers given the risk these assets hold.

“The FCA considers these products to be ill-suited for retail consumers due to the harm they pose,” FCA’s statement in October 2020 reads.

The financial regulator questioned the valuation metrics of the underlying crypto assets, market interference, proceeds from financial crime, and extreme volatility of crypto prices as reasons to stop the sale to retail customers. Notwithstanding, retail customers do not clearly understand these assets, the report read the “customers lack a legitimate investment need in these products.”

The FCA statement claims that investment in crypto ETNs and CFDs could cause customers to, “suffer harm from sudden and unexpected losses.”

With the ban kicking off today, the crypto community is in a divided territory as critics come out strongly claiming the flawed nature of the law, while others praise the steps taken by the financial authority. Critics argue that the rule limits retail investors (even the seasoned ones) from investing in crypto derivatives. They further argue that retail clients should be given equal opportunities as institutions.

Additionally, Komodo’s director of business development, Jason Brown stated the laws were made in a rush and didn’t involve other authorities and jurisdictions. The lack of involvement of any other country or region in creating these policies, according to Brown, distorts blockchain regulation across jurisdictions.

“What the blockchain industry needs the most is consistent regulations across jurisdictions,” Brown stated.

Other critics argued the prohibitive law will set individual customers to look for unregulated avenues and offshore cryptocurrency exchanges to invest in crypto derivatives which will make it even harder for the FCA to regulate them. This could cause even bigger harm to retail consumers than trading on regulated crypto exchanges, Dermot O’Riordan, partner of Eden Block explained.

Despite the criticism, some players in the crypto field are welcoming the law positively as a risk management tool for “reckless retail investors.” Speaking on the positive effects of the law, Gunnar Jaerv, COO of First Digital Trust said,

“More people would have to buy the ‘actual’ assets meaning that there would be real money going into the assets and will be priced into the market.”

This will stabilize the extreme volatility in the market as well as having stable prices, volumes, and market capitalization across the crypto market, he added.

The FCA in December extended the temporary registration regime period to July this year allowing crypto services providers in the process of obtaining a license to continue with their operations.

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Author: Lujan Odera

Deribit Now Allows Traders to Bet on Bitcoin’s Rally to $160k & Ethereum to $5k

Deribit Now Allows Traders to Bet on Bitcoin’s Rally to $160k & Ethereum to $5k

Bitcoin and Ether rally is just getting started, with Deribit options’ strikes continue to be higher and higher.

Cryptocurrency derivatives platform Deribit continues to make waves with its new strike rates.

If you think Bitcoin at $100,000 was the real deal, not for Deribit users. $100k was so last month’s thing, now that Bitcoin has surged at bove $28,000 this past holiday weekend, Deribit users are now betting at much higher prices.

Today, Deribit introduced call and put options at the $160,000 Bitcoin strike price expiring on Dec. 21, 2021.

“Remember that we list based on policy, not analysis, etc. Strikes up to delta 10,” noted the exchange which is “for algorithmic traders, institutions, and savvy retail traders.”

These new contracts came just on the back of the weekend’s $140,000 BTC, which was added a few hours after $120,000.

Purchasing these call contracts is a bet that the price of Bitcoin will rise above these levels either on or before their expiry date.

At the time of writing, BTC/USD has been trading at $26,728, seeing a small pullback, after the monster rally of last week, that broke multiple levels of new highs.

But it is not just Bitcoin the crypto market is bullish on. Now that BTC has taken a small step back, Ethereum has taken the reins from the flagship cryptocurrency and after a long time surged above $700 on Monday. After going to nearly $750 yesterday, we fell back under the $700k mark but today the market is on the move again.

And according to Deribit users, ETH is just getting started as the platform added the ETH contracts with a $5,000 strike which expires on Sept. 21 and Dec. 21.

Given that ETH is still about 50% away from its ATH, the digital asset has more room to grow. Not to mention, the Ethereum futures to be launched on CME in February next year will bring a herd of institutions.

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Author: AnTy

China Blacklists Crypto OTC Trading Desks With A Five-Year Banking Ban As Punishment

  • PBoC blacklists crypto OTC traders in its latest efforts to crack down on money laundering.
  • This has caused several OTC trading desks to shut down as the future turns bleak.
  • The central bank set a three to five-year banking ban in the country as punishment.

Bitcoin over-the-counter (OTC) traders could be facing up to a five-year ban on their banking accounts in China, local reports state. The central bank, People’s Bank of China (PBoC), is heavily cracking down on money laundering activities and is blacklisting several OTC trading desks dealing in cryptocurrencies.

Recently, the Chinese central bank had enhanced its efforts in cracking down money laundering activities hence the latest move. In a bid to stop the illicit and illegal trades, the PBoC is taking a step affront to combat cryptocurrencies being used to launder funds by setting some of the OTC traders under its “disciplinary list.”

The first step in PBoC’s crackdown in the crypto ecosystem will target large OTC traders who trade in millions. According to the report, exchanges that allow transactions away from the public and transact high volumes will be blacklisted. Some have already faced the brunt, having their bank accounts and bank-issued cards blacklisted for the next three years and their online accounts banned for the next five years.

Local banks and financial institutions are now in charge of monitoring money laundering, bidding to keep the vice away at the lowest levels and higher levels of government. The institutions quickly flag and restrict the transactions involved in money laundering, and subsequently, the information is transferred to the local branch of the PBoC.

Once registered, the “blacklist” is transferred to other banks and local financial institutions across the country. This prevents the OTC dealers on the disciplinary list from opening and transferring funds to new accounts.

Despite the crackdown, regulations on cryptocurrency transactions within China remain slim – leaving a grey area on the crypto transactions by investors. Because there are no corresponding rules and regulations, “various financial institutions have different judgment standards for cryptocurrency transactions” hence some crypto OTC desks could be flagged by some local financial institutions.

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Author: Lujan Odera

Will Bitcoin’s Price Over the Next Two Weeks Set the Pace for September’s Bulls or Bears?

As we enter the last week of August, several traders opine that the Bitcoin price’s performance over the next two weeks will determine if the value will drop below $10,000 or a positive surge will go on.

The week’s candle comes at a time when CME’s Bitcoin futures, as well as Deribit’s options contracts, are set to expire. This has the potential of setting the tone of prices for September. More so on whether Bitcoin will end the month above or below various key levels.

Mohit Sorout, Bitazu Capital founding partner, states that $11,800 is a crucial level for Bitcoin. He argues that an upsurge to $11,800 is likely to “put sellers to sleep.”

There are only a few days before the end of August and the Bitcoin futures sector has remained cautious. The number of long contracts in the market is more than the short-sellers with Bybt showing that longs are 53.36% of the total futures market. This indicates that traders are highly cautious and that a couple of scenarios might happen in September.

Bullish Short-term Scenario

In order for Bitcoin to continue with its upward trend in the short-term, traders state that Bitcoin’s price needs to trade above the $11,800 level. If this was to occur, traders forecast that Bitcoin is likely to trade above $12,500. Consequently, others believe that if Bitcoin trades between $10,900 and $11,500, then a bullish scenario is likely in the short-term.

Nunya Bizniz, a crypto analyst, explains that if monthly candle structure at the moment was to follow the previous ones, then a newfound bull run is likely in the short-term.

Bitcoin’s Stagnation Scenario

An alternative scenario, as advanced by some investors, is that the leading cryptocurrency may experience several months of low volatility or price remaining stable before a significant price surge. 10T Holdings co-founder, Dan Tapiero, explained that each price cycle has taken about 800 to 1,100 days for it to be complete. At the moment, the current cycle is not even 400 days old which means that Bitcoin’s price is likely to stagnate in the next one year. He said:

“Each upcycle takes longer to play out and is less extreme as absolute dollar value gets much larger. May or may not be another 6-12 months before price breaks up. It should not matter as the end price point obscenely higher. Holders rejoice.”

Historically, September has been a slow month for the crypto market, and as expected traders have mixed opinions on the next move for Bitcoin.

What’s your opinion on the next price move for Bitcoin? Let us know in the comments section.

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Author: Joseph Kibe

ESET Discovers Trojan Attack Targeting Cryptocurrency Traders Using Apple’s MacOS

The Internet security firm, ESET, has discovered a new trojan attack targeting crypto traders who use applications from Apple’s macOS.

According to the findings, the malware targets crypto wallets and is integrated with pseudo digital asset trading apps, which can easily be confused for the legit platforms.

Dubbed ‘GMERA,’ and not the first time the malware was used. Researchers from Trend Micro, another cyber sec firm, had come across it back in September 2019 when it had posed as Stockfolio, a Mac-built stock investment app.

Upon digging deeper, ESET researchers found that GMERA operators had integrated the malware with macOS’ Kattana crypto trading application. They then created a replica of the firm’s website to promote four new copycat apps, namely; Trezarus, Licatrade, Cupatrade, and Cointrazer. Notably, these malicious apps direct users to a ZIP archive containing the trojan zed versions, which in turn target crypto wallets once downloaded.

The researchers went on to highlight that anyone who is not very familiar with Kattana’s website can, therefore, easily be compromised:

“For a person who doesn’t know Kattana, the websites do look legitimate.”

The GMERA Malware

To fully understand how it works, ESET researchers analyzed samples from Licatrade whose functionality is pretty similar to the other malware. As per the findings, GMERA installs a shell script on the target’s computer, giving the hackers access to a user’s system through the app.

They then leverage HTTP to create C&C or C2 servers to initiate communication between them and the compromised machine. In doing so, they can steal information such as location, crypto wallets, and screen captures stored in the user’s database. Following these findings, ESET raised the issue with Apple leading to the revokement of Licatrade’s certification.

Also Read: Twitter Hacker Managed to Scam Only 12 Bitcoin After Duping Major Accounts Using ‘Internal Tools’

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Author: Edwin Munyui

Ethereum Active Addresses Surge to a Two-Year High But They Also Coincide with Market Tops

Currently in the green by 1.07%, Ethereum is trading at $224, up 80% YTD. ETH traders meanwhile are expecting more gains with ETHUSD longs on Bitfinex still near all-time highs.

This growth has the USD balance of ETH on the crypto exchange nearly doubling this year which is in exact opposite trend with the Bitfinex’s bitcoin balance which saw the biggest outlaw among all the exchanges.

What’s bullish is the active addresses on Ethereum that are currently at a level that was last seen in June 2018. These addresses interacting with ETH have spiked to a two-year high of 486,000.

glassnode-studio_ethereum-active-addresses-7-d-moving-average
Source: Glassnode – Ethereum: Active Addresses (7d Moving Average)

However, this indicator is also a cause of concern because “peaks of the daily active addresses line up with market tops.”

Ethereum Usage on New Highs

The network usage is already at new highs with the total ETH gas used on the Ethereum blockchain reaching a new all-time high. This surge is coinciding with the ETH miners voting to increase the block gas limit by 25%.

Although it will increase the network’s capacity to handle the transactions from 35 to 44, it will make it harder and costlier to sync a node. Also, it would increase the risk of DoS attacks.

Ether, the native token of Ethereum, is required as payment to complete the transactions across the network. And as the demand for transaction activity rises on the platform, so does the demand for ether.

As such, the median daily fee on the Ethereum network continues to go higher as the number of ERC-20 transactions pushes into an all-time high territory. Ethereum fees are also exceeding Bitcoin fees for the third time in a row.

Eth fees have been higher than the leading cryptocurrency network on more consecutive days now, which was last seen only once in May 2018.

BTC vs ETH Network Fees
Source: Glassnode

The transaction count is also going parabolic because of the growth of stablecoins and DeFi. The 7-day average of ETH transaction count is now approaching all-time highs set in January 2018.

Source: Coin Metrics

The DeFi Effect

While major fiat-pegged digital assets have surpassed $11 billion, Tether (USDT) has pushed past $10 billion, as per Messari.

Similarly, the amount of ether collateral deposit in DeFi applications has also reached a recent high of 3 million ETH. This figure is shy of the all-time high of nearly 3.3 million deposits in DeFi earlier this year.

Tradeblock Ether Deposited into DeFi
Source: TradeBlock

DeFi tokens are currently the hot commodity in the market with on-chain liquidity protocol Kyber rallying today. The crypto jumped after an upgrade that includes changes to its KNC model to attract more participants to the protocol’s development.

Moreover, now more and more bitcoins are getting on the second-largest network. According to Dune Analytics, “over 11k BTC, which is over 0.05% of BTC supply, is now on Ethereum.”

“Assuming the “hype” is real and that this is another, much more extended growth cycle that the DeFi is about to undergo, the big question is where will the new capital come from,” wrote Denis Vinokourov of Beqaunt.

According to him, aside from collateralized loans and securitized Bitcoin currently in progress, another prime suspect for capital rotation is centralized exchange tokens, he said.

“With the IEO market in hiatus and spot market activity somewhat suppressed especially given the seasonal effects in play at the moment,” it may lead to at least 10% of capital out of CEX to DEXes.

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Author: AnTy

Police Freeze Chinese Crypto OTC Traders’ Accounts; Digital Assets Tied to Laundered Money

Chinese Police freeze crypto over the counter traders (OTC) accounts to investigate a possible incident of money laundering stains on some of the digital assets on exchanges. The abrupt halt in China’s biggest fiat on- and off- ramp gives sets in surveillance by the relevant law enforcement officers with locked users’ accounts needing an “approval of innocence” by the government before getting back your funds.

Chinese Police launch investigation on ‘tainted accounts’

A blog post on Weibo by one of the top OTC desk managers in China, Sun Xiaoxiao, revealed that China’s police in Guangdong province froze thousands of crypto OTC traders’ accounts starting last Thursday.

According to Sun the police froze users’ funds which they found to be “tainted” by money laundering activities. The police maintain the act to freeze funds is to investigate further on the possible source of the tainted crypto – no trader is being accused of any wrongdoing.

The speculations however are rising on what could be the possible reasons the OTC traders accounts have been frozen. Sun reasoned that the police may be targeting crimes involving telecommunication frauds, Ponzi schemes and casino businesses which use these trading desks to launder ‘dirty money.’ Sun’s blog post read,

“Now there are also OTC merchants who had their bank accounts frozen because of questions over the source of the coins they bought. That means, besides ‘dirty money,’ there are also ‘dirty coins‘ circulating.”

The police are yet to release any statement on the possible reasons why they froze the accounts.

An unusual act from the authorities

Money laundering on blockchains is quite common as the anonymity on cryptocurrencies give users some masked protection in laundering their money. In China, money laundering on OTC desks has been growing as the dirty money is transformed into Bitcoin (BTC) and other cryptocurrencies.

Through market activities, some of these cryptocurrencies bought by tainted cash do find their way to innocent users’ accounts. Blockchain tracking tools such Chainalysis have made it easier for the police to trace such cash on public blockchains. The Chinese police are heavily invested in tracking tools in order to track down the money laundering activities, and innocent accounts do get caught in the middle.

However, in the past the police never froze innocent OTC traders’ funds due to tainted coins. Sun said this was a rather strange move by the police stating its “unusual for users to have their accounts frozen over tainted cryptocurrencies.”

For users to regain access to their accounts, they will need to prove to the authorities that their coins are “clean” by proving their source.

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Author: Lujan Odera