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Are we there yet? Here’s why one analyst says its not ‘altcoin season’

Altcoins have been on a real tear for months, but Jarvis Labs analyst Ben Lilly says we’re not in an “alt season” just yet.

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Few traders would argue against the fact that Bitcoin (BTC) is in a bull market, but there is less consensus on whether the market is in the midst of an “altcoin season.” A quick view of Crypto Twitter shows the schism between traders who are certain we are halfway through alt season and those who believe it has yet to begin.

Typically, traders rely on a wide swath of indicators and metrics, like Bitcoin’s total market capitalization versus the total altcoin market cap, Bitcoin’s dominance rate, and whether low-cap altcoins have rallied by a certain percentage.

As is the nature of investing, too much signal can at times produce mixed results, so Cointelegraph decided to have a chat with Ben Lilly, co-founder and analyst at Jarvis Labs, to see where he and his firm think the market currently stands and to determine the most appropriate metrics to use in figuring out whether or not an altcoin season is truly at hand.

Cointelegraph: A number of analysts claim we’re in an altcoin season, or at least right at the verge of one. Some are looking at support/resistance flips and fractals on altcoin market cap charts (isolated from BTC’s market cap) to make convincing arguments. Why do you think that we are nowhere near an altcoin season?

Ben Lilly: I believe everybody’s interpretation of what defines an altcoin season varies. For many, altcoin season might exist when both BTC and altcoins move higher. This is opposed to Bitcoin rising while altcoins remain flat or drop.

I think this is a fair view of altcoin season, but it’s not necessarily one I subscribe to. Simply because if this is a definition for altcoin season, it’s not a compelling reason for me to move away from Bitcoin and into altcoins from a risk-adjusted perspective.

Because in that definition of altcoin season, Bitcoin is still the preferable asset to own.

We think of altcoin season as market movements that take people by surprise or at least make traders rethink what is normal.

CT: So, altcoin seasons are not reflecting a macro-level trend shift in the market direction of Bitcoin’s momentum?

BL: Well, getting back to what I said earlier, support and resistances are helpful ways to explain. We can view these as areas that, when broken, create fast price action. It’s the type of action you want exposure to, assuming you’re on the correct side of it. While anything in between these supports and resistances can almost be assumed as “expected” or normal — in a loose sense.

To figure out where this area might be, we can look at a Bitcoin dominance chart. This lets us know the percentage of the market Bitcoin represents. Right now, it’s trading in a range, which is to say an “expected” range. And because it’s trending down, this is good for altcoins as Bitcoin concedes some dominance to other coins.

While many might point to this and say it’s an “altcoin season,” I’ll point out that this type of activity tends to happen in a bull cycle because new money is moving in.

In fact, we’ve been trading in this range of expectation from the middle part of 2019, which coincides with when Bitcoin found its low and began to turn bullish.

Bitcoin market cap dominance weekly chart. Source: TradingView, Jarvis Labs

Oddly enough, we recently jumped out of this range in late 2020, and when we did, Bitcoin went on an absolute tear. During this run, altcoins lost value. And similar to how Brent Johnson describes his dollar milkshake theory, Bitcoin sucked up the market’s liquidity as it ran higher.

We have since returned to this range of expectation, also known as the normal area of the market.

Now, if the opposite happens and we break this expected range to the downside, in our point of view, this will signify that altcoins are the asset to be sitting in, as they will generate outsized returns relative to Bitcoin. That’s when things will get wild.

CT: For years, traders have pinpointed the shifts in dominance rate between BTC and altcoins as a relevant indicator of when altcoin season begins. As the theory holds, when Bitcoin’s price consolidates or is in a downtrend and its dominance rate drops below a certain percentage, altcoins capitalize on Bitcoin’s range-bound action by rallying higher. What thoughts do you have on this?

BL: Similar to what I explained previously, it’s all about expectations. As soon as the market creates a change in view of what’s normal, then “altcoin season” will appear.

Another chart I’m frequently leaning on is the ETH/BTC pair. When Ether gains in relation to BTC, this is generally a good sign for altcoins. And recently, there’s been some bullish momentum on the chart within its current range of expectation.

The ETH/BTC pair is currently forming what we can describe as the Livermore Accumulation Cylinder. For more than a month, we have been discussing this in our free “Espresso” newsletter from the Jarvis Labs Substack, and what is clear is that the chart is taking form and is at the later stages of its trend.

If ETH/BTC breaks up and out of this cylinder, it’ll be another moment where expectations of what is normal will be adjusted. This is when we will see fast price action, and likely an altcoin season.

ETH/BTC weekly chart. Source: TradingView, Jarvis Labs

CT: While a rising tide does lift all boats, altcoins have been the top performers in the market when compared with Bitcoin. A quick look over CoinMarketCap shows that at least 50 have made moves that are well above 100%, and the altcoin market cap has risen from $250 billion in January to nearly $900 billion today. In your opinion, what is the primary signal that the market is in a proper altcoin run?

BL: Now, this is a bit different than an altcoin season, in my opinion. That’s because a proper bull run for altcoins is when investors are more likely to walk further out on the risk curve of crypto versus simply buying Bitcoin, not necessarily outsized gains compared with Bitcoin.

Based on this definition, we can make the case that whenever Bitcoin dominance is falling while crypto as a whole is in a bull market (like today), then this is a bull market for altcoins.

While investors might not have outsized gains relative to Bitcoin in a proper altcoin bull run like they would in an altcoin season, it is wise to begin building exposure to these higher-risk assets in this environment.

CT: Does on-chain data have any value in determining when alt seasons begin?

BL: Absolutely. On-chain is very valuable if you know how to filter out all the noise that comes with it. With crypto, there’s so much transparency in seeing transactions on-chain. This creates a trove of data that can be looked at in hundreds of different ways, many of which are somewhat meaningless.

At Jarvis Labs, we filter out all the data to find the data that matters. Then we run it through algorithms to create trade signals. It’s high-value data analytics and tends to be used in place of in-house analysts.

In saying that, on-chain is still an evolving space outside of Bitcoin and Ethereum. We’re on half a dozen blockchains watching these signals evolve and generating a variety of reliable signals will better pinpoint exactly when trend shifts take place and altcoin seasons begin and end.

One simple thing traders can follow in order to see the progression of an altcoin season is USDT flows.

When an altcoin season arrives, we’re likely to see USDT flow into other layer-two protocols such as Polkadot, Cosmos and Solana. That’s because many small-cap assets that are very far out on the risk curve, which tend to be bought in these types of environments, will exist on decentralized exchanges rather than centralized exchanges.

As investors start buying up these small-cap assets, liquidity will arrive, and USDT is the most ubiquitous form of liquidity in the market.

So, when USDT enters these ecosystems by the hundreds of millions, you can be sure it’s altcoin season, as investors will be chasing these assets only found on DEXs native to their protocol (i.e., Serum).

CT: Is it possible that the narrative may be changing and that some altcoins are breaking away from their reliance on the performance of Bitcoin, shifting what an altcoin season may look like?

BL: The changing landscape of risk is how I view this particular question.

And as other assets begin to grow in market cap and age, the network effects will grow. This, in turn, will insulate many crypto assets from Bitcoin since a lot of value will be attached to them.

In this way, over time altcoins will slightly deviate away from BTC’s performance.

Ethereum will be the first asset to do this, simply because of where it’s at in terms of its life cycle and development. But in terms of being immune to Bitcoin’s price, this won’t happen for many years. In fact, I think there will always be some correlation to an extent.

That’s due to macro reasons. Simply put, commodities as a whole tend to have a correlation to one another, equities as a whole have correlation, and even currencies tend to move in tandem with one another (i.e, USD, CHF, JPY). In saying this, crypto as a whole is likely to move in tandem with one another for at least most of this decade if not longer.

Disclaimer: Cointelegraph does not endorse any content or product on this page. While we aim to provide you with all the important information that we could obtain, readers should do their own research before taking any actions related to the company and carry full responsibility for their decisions, nor this article can be considered as investment advice.

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Source: https://cointelegraph.com/news/are-we-there-yet-here-s-why-one-analyst-says-its-not-altcoin-season

Blockchain

Is Facebook Getting into Bitcoin? See What Mark Zuckerberg Just Did

Mark Zuckerberg has hinted that he could be into Bitcoin. This was deduced from one of his Facebook posts. Facebook’s CEO posted a photo of […]

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Mark Zuckerberg has hinted that he could be into Bitcoin. This was deduced from one of his Facebook posts.

Facebook’s CEO posted a photo of his two goats named ‘Max’ and ‘Bitcoin.’ Market speculators believed this was a hint that the CEO is finally warming up to Bitcoin. He has now been labeled a ‘Bitcoiner,’ the term given to Bitcoin (BTC) enthusiasts.

SkyBridge founder, Anthony Scaramucci, said that he was excited about Zuckerberg finally joining the Bitcoin community. “I knew Mark Zuckerberg would become a Bitcoin-er when he hired David Marcus from PayPal to run Facebook’s crypto business. It’s been a long and winding road, but welcome to #Bitcoin. Great job, Zuck and David. Excited for what comes next,” he tweeted.

Facebook’s journey to cryptocurrencies

David Marcus has been instrumental in Facebook’s journey towards adopting cryptocurrencies. He was a former executive of PayPal before Facebook poached him in 2014. Marcus has been heading the crypto division of Facebook, specifically Novi, which runs a digital wallet for Facebook’s proposed crypto, Libra, renamed as Diem.

Facebook has also been racing towards creating a payments platform that to rival Venmo, Apple Pay, and Google Wallet. If the payments service is launched on Facebook, it will allow users to send and receive payments on several Facebook-affiliated Apps.

The expected date of Facebook’s crypto Launch

Most commentators believe that May 26 is the date when Facebook will make its announcement regarding crypto – this is when the shareholders’ meeting takes place. Some expect that Zuckerberg will announce his Bitcoin holdings. However, this may just be wishful thinking as no official communication on the matter has been released.

Facebook had earlier been expected to release details of the crypto holdings they have on their balance sheet in late April. However, this did not happen. Its Q1 2021 results did not disclose the company’s crypto holdings, if it has any. The Q1 results showed $64 billion in cash and other equivalents.

Bitcoin Chart 11 May 2021
BTC/USD 1 day chart, Binance, 11 May 2021. Courtesy TradingView

If Facebook jumps ship and starts adopting crypto payments, it will be joining the likes of Tesla and PayPal. There are several ways that a company can adopt crypto in its operations. It can integrate a crypto payment system.

This is a high likelihood given that Facebook was prepared to launch Libra in a similar way.

It could also announce that it’s holding Bitcoin or other cryptocurrencies on its balance sheet. Whichever option Facebook chooses, it will play a great role in increasing the value of cryptocurrencies and help maintain the bullish rally.

Looking to buy or trade Bitcoin now? Check out Learn2Trade!

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Source: https://insidebitcoins.com/news/is-facebook-getting-into-bitcoin-see-what-mark-zuckerberg-just-did

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Indonesia Plans to Tax Crypto Trading

Following the growing adoption of digital assets in the country, Indonesia’s officials consider a plan to start taxing cryptocurrency trading.

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The Southeast Asian country of Indonesia considers a plan to tax trading with digital assets. However, a spokesman from the tax office revealed that the proposed scheme was still at the discussion stage, and no changes have yet been applied.

The Crypto Environment in Indonesia

The biggest economy in Southeast Asia – Indonesia – saw a massive increase in crypto users in the past months. Following the recent rally of most digital assets, local residents of the country turned their sight to them. According to a report, Indodax – the largest crypto exchange platform in Indonesia – registered more than 700 000 new members only for the first four months of 2021 as the total number rose to three million people.

However, Reuters reported that the country’s officials are contemplating a plan to tax trading with Bitcoin and all altcoins. Neilmaldrin Noor, a spokesman at Indonesia’s tax office, asserted that the future implementations were still at the discussion phase, and no changes have yet been administered. Additionally, he explained that taxation is vital for the economy:

”It is important to know that… if there is a profit or capital gain generated from a transaction, the profit is an object of income tax. So the tax payer who receives capital gain has to pay the tax and report it.”

Indonesia has a very controversial relationship with cryptocurrencies. The authorities of the country banned the use of digital assets as a payment instrument, but on the other hand, residents are allowed to trade with them as a commodity.

Following the Asian Wave

Indonesia’s tax reforms regarding cryptocurrencies are not pioneering. As CryptoPotato reported, another Asian country – South Korea – revealed its intentions to start taxing digital assets.


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The authorities are reportedly looking to place a 20% tax on profits made from cryptocurrency trading at the start of next year. The Finance Minister of the East Asian country asserted that such rules are ”inevitable” to start from 2022.

Somewhat surprisingly, most residents of South Korea approved the incoming implementations. A survey revealed that around 54% of the poll participants backed the country’s tax addition. Moreover, older Koreans were significantly more open to the idea comparing to the younger generation.

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Source: https://cryptopotato.com/indonesia-plans-to-tax-crypto-trading/

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Shield Finance Completes a $780K Round to Create a DeFi Insurance Aggregator

[PRESS RELEASE – Chiang Mai, Thailand, 11th May 2021] Shield Finance, a multi-chain DeFi insurance aggregator that will deploy across the Polkadot, Ethereum, Binance Smart Chain, and Solana blockchains announced today the completion of their private fundraising rounds, having successfully reached the hard cap amount of $780 000. Private Investors. Shield Finance’s potential combined with […]

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[PRESS RELEASE – Chiang Mai, Thailand, 11th May 2021]

Shield Finance, a multi-chain DeFi insurance aggregator that will deploy across the Polkadot, Ethereum, Binance Smart Chain, and Solana blockchains announced today the completion of their private fundraising rounds, having successfully reached the hard cap amount of $780 000. Private Investors.

Shield Finance’s potential combined with its seasoned team attracted immense support from industry innovators including Master Ventures / PAID Network, DAO Maker, Zokyo, NGC Ventures, Spark Digital Capital, GD10.Ventures, Titan Ventures, and others.

The decentralized finance movement has been growing exponentially over the past year growing from $700 million by December 2019 to $65 billion as of April 2021. DeFi gives users full control over their money and financial future but this freedom comes with some drawbacks. As thousands of retail investors enter the attractive DeFi marketplace there are a variety of risks they have to take into consideration including market crashes, price volatility, and security issues. Until only recently, the DeFi has lacked any insurance options to give users peace of mind when investing in these new financial products. This is about to change.

Shield Finance is a DeFi insurance aggregator that aims to protect token investments from hacks, rug pulls, market crashes, and other DeFi-related risks. It does this through a proprietary aggregation engine that provides custom insurance packages for investor needs. Shield Finance could be referred to as the Skyscanner for DeFi insurance; users can see and select offers from multiple insurance providers without leaving the token platform.

“Insurance plays an important role in DeFi as a way to de-risk your investments. With a number of insurance players in the market, a multi-chain insurance aggregator will naturally attract users as a go-to place to buy insurance. This fundraise will be instrumental in driving the growth and development of Shield Finance.” Denis Gorbachev, CEO of Shield Finance

Shield Finance aims to dominate the cryptocurrency insurance market by partnering with DeFi exchanges, wallets, and farms. Shield Finance’s goal in doing so is twofold: to ensure DeFi insurance purchasing is easy and simple to purchase and to offer the cheapest DeFi insurance packages on the market.

As the Shield Finance platform launches more exciting features will be released including a web app and increased partnerships & integrations with insurance providers and DeFi platforms including exchanges, wallets, and farms.

Shield Finance expects development of the platform to be complete (timeframe?) after its public IDO launch on industry driving PAID Network’s crowdfunding platform, Ignition Launchpad. Operating as a decentralized swapping protocol, Ignition allows blockchain-based token projects to offer their private and public auctions to participants, leveraging both PAID Network and Polkadot technology. Capitalizing on PAID Network’s community strength and the popularity of the Ignition Launchpad platform the success of Shield Finance’s public IDO is all but certain.

Shield Finance IDO is set to take place May 19th, 2021 on PAID Network’s Ignition Launchpad at 11:00 AM UTC Ignition – IDO Launchpad on PAID Network

About Shield Finance

Shield Finance is a Multi-Chain DeFi Insurance Aggregator that allows users to buy protection against major market crashes due to black swan events (hacks, exploits, rug pulls, sell-offs). Incubated by Master Ventures (MV Fuel), Shield utilizes a proprietary aggregation engine to provide custom insurance packages for investor needs. The $SHLD token enables governance and provides staking rewards at 30% stable APY – however, the most important feature of the $SHLD token is the “buy & burn” program. Every quarter, it redirects 50% of fees generated by users to buy the $SHLD token on the open market & burn it, which results in the permanent reduction of supply.

Connect to Shield Finance:
Website: shieldfinance.io
Telegram: @ShieldFinanceHQ
Twitter: @ShieldFinance

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Source: https://cryptopotato.com/shield-finance-completes-a-780k-round-to-create-a-defi-insurance-aggregator/

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QAN Raises $2.1 Million in Venture Capital to Build DeFi Ecosystem

QANPlatform has successfully closed a $2.1 million funding round and it looks to build a quantum-resistant DeFi infrastructure.

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QANPlatform – a project that is on a mission of building a quantum-resistant hybrid blockchain protocol, secured investment from various venture capital funds to build a DeFi ecosystem.

QAN Successfully Closes a Funding Round of $2.1 Million

The question of whether or not existing blockchain-based PoW networks would stand the test of a quantum computer is one that’s been discussed for quite some time. To this date, many believe that a quantum computer is the most serious threat to Bitcoin as it would be able to solve math problems a lot quicker compared to traditional mining machines.

In any case, in an attempt to tackle these issues, along with others, QANplatform has raised $2.1 million to fund the development of an ecosystem where developers would be capable of building various software applications within DeFi quicker.

Leading the round were the likes of DeltaHub Capital, BlackDragon, Insignius Capital, Fairum Ventures, and so forth.

Speaking on the matter was Johann Polecsak, co-founder and Chief Technical Officer at QANplatform, who said:

“Our key mission is to lower the entry barriers for developers so startups and enterprises can build their Proofs-of-Concept (PoC) and Minimum Viable Product (MVP) as fast as possible to reach mass adoption. We stick to this view and let only community-driven VCs invest in this strategic pool”

Quantum Computing and its Threats

According to a well-known report from one of the largest auditing and security service companies in the world – Deloitte, quantum computing does pose a threat to Bitcoin.

Of course, it’s important to factor in the possibility of such a computer being created and used for this particular purpose, but, in theory, it could cause damage, according to the experts.

For instance, there are around 4 million bitcoins that are potentially vulnerable to a quantum attack. Yet, there are plenty of things to keep in mind when thinking about this. For instance, it’s important to note that these are mostly p2pkh addresses, and only those which have never been used to spend bitcoins are safe because their public keys are not yet public. In other words – if one transfers their BTC to a new address, they should not be vulnerable to a quantum attack.

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Source: https://cryptopotato.com/qan-raises-1-8-million-in-venture-capital-to-build-defi-ecosystem/

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