Price point
Bitcoin (BTC) exceeded $ 50,000 for the first time on Tuesday for a new historic maximum price.
The gain brought the year-to-date return to around 70%, and traders immediately started to discuss what was to come next.
- “We are still in the midst of a violent bull run that will soon be more violent,” Ari Paul, investment director at BlockTower Capital, tweeted Sunday.
- “We are concerned with the pace of these market movements and, therefore, we recommend proceeding with caution in the short term,” said Joel Kruger, crypto strategist at LMAX Digital, by email. NOTE: A price correction on Monday led to more than $ 520 million in settlement of future positions.
- Bank of America, in a monthly survey of investors on “more crowded trades”, said “long bitcoin” – bets on more price gains – fell to second place, behind “long tech”. Bets against the US dollar (“short dollar”) came in third place.
In traditional markets, US stock futures pointed to a bullish open. “Reflection trade is fueling assets linked to economic growth and price pressure, including commodities and cyclical stocks,” Bloomberg News reported. “At the same time, investors are riding a wave of speculative euphoria from shares of cents to bitcoin amid abundant political support.”
The news
CRYPTO CRUSH: The signals continued to grow from greater acceptance of bitcoin and other cryptocurrencies.
- MicroStrategy by Michael Saylor plans a new $ 600 million sale of convertible notes and will use the net proceeds to buy more bitcoin.
- German bank, Germany’s largest creditor, is exploring cryptocurrency custody, with aspirations to offer high-contact services to hedge funds that invest in the asset class, said Ian Allison of CoinDesk on Friday.
- Morgan Stanley’s Counterpoint Global’s $ 150 billion investment unit is considering placing a bet on bitcoin, according to a report by Bloomberg, which quoted people familiar with the matter.
- The city of miami, following the example of Mayor Francis Suarez, voted at the end of last week to study the use of cryptocurrencies to pay for services or workers’ salaries by launching educational campaigns in English, Spanish and Creole.
VERGE SNAFU: Verge, a small cryptocurrency that serves as a payment option on Pornhub, underwent a massive reorganization of 560,000 blocks on Monday, according to researchers at Coin Metrics.
- Verge’s last 200 days of transaction history “just disappeared,” wrote Lucas Nuzzi, network data analyst at Coin Metrics. He described the event as “probably the most profound reorganization that has ever occurred in a ‘top 100’ cryptocurrency.”
- Verge’s official Twitter account said the “development team released a fix” and that everything should be “business as usual” in “13 hours”, reported Zack Voell of CoinDesk.
- The cryptocurrency formerly known as DogecoinDark is no stranger to network attacks. He underwent similar but less serious explorations in April 2018 and May 2018.
Market movements
Nouveau riche emerges as crypto market capitalization reaches $ 1.5 trillion
The market value of all cryptocurrencies surpassed US $ 1.5 trillion for the first time, and it is interesting to note how much of this growth was fueled by speculation about which projects may be the most promising, instead of just pumping also executed tokens that dominated the high echelons of the sector in the last years.
Of course, the Bitcoin and Etherum’s industry leaders still dominate the charts, representing about US $ 1.1 trillion of the total. But the top 10 tokens now include cardane (ADA), polkadot (DOT), Binance currency (BNB) and chain link (LINK) – all associated with projects perceived as having at least some right to help create the future of finance.
They are new rich in cryptography, moving up the industry hierarchy at the expense of XRP (XRP), litecoin (LTC) and bitcoin cash (BCH), which dominated until recently, but apparently did not inspire traders to the same degree.
Some companies in the growing decentralized finance (DeFi), a subsector of the crypto industry where entrepreneurs are using blockchain technology to design automated versions of creditors and trading platforms, are raising money through symbolic sales in the same way that a Silicon Valley startup could sell one shareholding for a venture capital fund.
In truth, Synthetix, a decentralized commercial project, has just raised $ 12 million from investors Coinbase Ventures, Paradigm and IOSG – apparently through a sale of the SNX tokens associated with the project. “The increase appears to be a rare occurrence of VCs investing by purchasing a platform’s native token directly from their treasury, rather than transferring funds to their founders,” wrote Daniel Kuhn of CoinDesk on Sunday. SNX tokens have tripled in price this year to a market value of about $ 2.9 billion.
“Individually, none of this can make sense, and no one can really predict who will really win, ”said John Wu, president of Ava Labs, in an interview. His company supports the Avalanche blockchain, whose native AVAX cryptocurrency has increased about 10-fold this year, to a market value of $ 3 billion. And that was after the revelation of a programming bug last week triggered a quick price correction.
“This is very similar to investing in technology where people are paying for the future, ”said Wu.
Token Watch
- Ether bet on the deposit contract “2.0” reaches US $ 5.5 billion.
- The price reached a new all-time high of $ 1,872.52 on February 12th.
- Simon Peters, a crypto analyst at the eToro trading platform, wrote in an email: “The offer is limited by investors depositing currencies outside the network, and the purchase of institutional investors continues to rise.”
- Denis Vinokourov, head of research at crypto prime broker Bequant: “The amount of bitcoin blocked on Ethereum remains in a relentless upward trend (174k this morning), sustaining the ‘search for yield’ trading, which, combined with the rise by BTC resulted in the total value blocked on DeFi platforms rising to more than $ 40 billion, however, the well-documented double-edged sword of a “hyperactive” Ethereum network with erratic gas rates continues to wreak havoc and hour-long delays in transaction validations, again squeezing smaller market participants. The time has come for platforms to put more focus on layer 2 solutions, and this will be beneficial to the broader ecosystem because it is likely to lead many users to decentralized exchanges. “
- The price has dropped in five of the past eight days to about 5.8 cents.
- Accelerated slide after Tesla CEO Elon Musk tweeted on Sunday: “If the biggest dogecoin holders sell most of their coins, it will have my full support. Too much concentration is the only real problem for me.”
- A dogecoin address holds 27% of the stock of the meme token, according to Decrypt.
- An exceptionally high volume of transactions highlighted a code bug that severely paralyzed the Avalanche blockchain last week, but the funds were never at risk, wrote an engineer at Ava Labs, the development company behind the network, in a post by Medium on Sunday.
- The episode represented a constraint as to why the blockchain “Ethereum killer” touted its ability to handle high yields.
- AVAX tokens have dropped in price since the incident, although they have still increased 11 times so far in 2021.
Opinions and Observations
ESTIMULUS BITCOIN GAINS: Americans who bought bitcoin with the U.S. government’s first $ 1,200 stimulus check increased by 639%.
BLOCK CHAIN ENERGY USE BETWEEN ROMANIA AND POLAND: Bitcoin and six other chains of proof-of-work blocks use between 55.1 terawatt hours of electricity per year (roughly Romania’s energy footprint) and 180.1 terawatt hours (Poland or Thailand), argues Tim Swanson, founder of the Post Oak Labs and head of market intelligence at Clearmatics, in a newspaper published on Sunday.
MOHAMED EL-ERIAN SEES “OFFICIAL” RISK GROW: “TThe private sector is increasingly adopting bitcoins as a form of payment and as a way of investing ”, said the chief economist at Allianz CNN’s Julia Chatterley said in an interview. “The official sector is warning more about bitcoin. The real accident here is what the official sector says, that’s enough. “
