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Bank of America Slams Bitcoin in Research Note

The multinational bank said the asset is ‘slow’ and ‘impractical’ while pointing out environmental concerns related to Bitcoin mining.

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In brief

  • A research note by the Bank of America argued that investors had few good reasons to buy Bitcoin.
  • Among its concerns were the price volatility and the environmental effects of Bitcoin mining.

Bank of America, the second-largest bank in the US, slammed Bitcoin in a recent note to clients and questioned the environmental implications of maintaining the asset.

Per financial publication The Street this morning, the report, titled “Bitcoin’s Dirty Little Secrets,” argued that Bitcoin had little role to play in an investor’s portfolio.

“Bitcoin has also become correlated to risk assets, it is not tied to inflation, and remains exceptionally volatile, making it impractical as a store of wealth or payments mechanism,” the bank said.

The report claimed that Bitcoin prices could be manipulated upwards with a relatively small amount of money. It said that just $93 million in fund inflows could trigger a 1% price increase (a $580 move) for Bitcoin while doing the same for gold would take over $1.86 billion.

This, according to Bank of America, is likely due to the concentration of Bitcoin. Over 95% of the total mined coins are controlled by the top 2.4% of addresses with the largest balances, the note claimed, stating such ownership created a social issue for new investors.

Mining: An environmental concern

Price volatilities aside, the Bank of America note also raised concerns about the huge energy consumption required for Bitcoin mining.

Bitcoin mining is an energy-intensive process that requires the use of massive computing rigs—and the corresponding hardware to cool down such machines—to process transactions and maintain the network. 

A lot of carbon dioxide is emitted as a byproduct of mining, meaning it isn’t an environmental-friendly process. “A $1 billion fresh inflow into Bitcoin may cause CO2 to rise by the equivalent of 1.2 million (combustion engine) cars,” the note said.

It added that since most Bitcoin was mined in China, the sector was directly “linked” to fuel resources in China. “Hash power today is mostly in coal-fired Xinjiang, a link between prices, energy demand & CO2 means Bitcoin is tied to Chinese coal,” the note said.

Bank of America’s comments run counter to the recent sentiment change for Bitcoin on Wall Street. Big banks like JPMorgan and Morgan Stanley have changed their tone on Bitcoin in recent months, and are even building out cryptocurrency offerings for their clients.

Institutional investment isn’t confined to the banks, either. Big-name technology firms like Tesla, Square, and MicroStrategy have all added Bitcoin to their corporate treasuries in recent months, using it as a hedge against overinflation in the US and an overall poor economic outlook.

Bank of America, it seems, has yet to be convinced.

Coinsmart. Beste Bitcoin-Börse in Europa
Source: https://decrypt.co/61881/bank-of-america-slams-bitcoin-in-research-note

Blockchain

Tether launches on Hermez rollup as Ethereum starts falling behind

Ethereum is starting to lose ground to its competitors for USDT usage, and Hermez may help to fix that.

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Tether’s USDT stablecoin has now launched on Hermez Network, an Ethereum scalability solution based on the zk-rollup concept. Rollups provide a way of batching or “rolling up” transactions to lighten the load on the Ethereum network.

The key to rollups is the concept of data availability, which means that the state data of the rollup is always fully available on-chain. In practice, this means that the Ethereum network knows the token balances of all user accounts on the Hermez rollup after every transaction, and this knowledge can be used to rapidly withdraw funds and distribute them to their new owners in the event of malfunctions.

Zk-rollups can be considered as separate “blockchains” that are entirely reliant on the layer-one network for security. Through the use of zk-SNARKs, the Hermez rollup publishes regular proofs to the Ethereum network that verify its correctness. Due to the succinctness property of SNARKs, the underlying data can be almost arbitrarily large, while the proof will remain constant in size. This makes it perfect for scalability applications, as the Ethereum network is able to conclusively prove that the network is working as intended with just a fraction of the data that the rollup itself processed.

By launching USDT on Hermez, Tether hopes to alleviate the pressure on Ethereum gas fees, where the Tether contract is consistently among the highest gas users. As fees for token transfers consistently stay above $10 on Ethereum — with exchanges upping their withdrawal charges in response — the market has significantly diversified on its Tether usage.

Transferred value in USDT on Ethereum, Tron and Omni (Bitcoin). Source: Coinmetrics.

Tether on Tron has reached parity with Ethereum in terms of value transferred, a significant achievement for Tron and source of concern for Ethereum supporters. Arguably, the most significant contributing factor to Tron’s rise is the support from a number of exchanges such as Binance, Huobi, OKEx and many others that are traditionally associated with Asia and Asian traders. Whatever users may think of Tron, few can argue with its low fees and significant acceptance.

Hermez provides an Ethereum-native alternative to Tron, though it adds to OMG Network’s Plasma, which so far seems to have failed to gain significant traction. Hermez can currently be accessed by using MetaMask, binding to the user’s Ethereum wallet. Transacting on the network requires performing a deposit transaction from the Ethereum main chain, after which the funds become available on the rollup. However, without a meaningful number of possible destinations for the funds, Hermez risks getting stifled by competition from other sidechains and layer-one networks.

The Hermez team is fully aware of this predicament and is working to integrate with as many exchanges as possible, but it remains to be seen whether its efforts will be successful. In the meantime, Bitfinex has pledged it will add native support for Hermez as a withdrawal option on its exchange.

Coinsmart. Beste Bitcoin-Börse in Europa
Source: https://cointelegraph.com/news/tether-launches-on-hermez-rollup-as-ethereum-starts-falling-behind

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DogeCoin (DOGE) Enters the Top-5 Crypto List With New All-Time High of $0.42

Despite a major market correction on Sunday, April 18, meme-coin DOGE has bounced back very strongly to enter the top-5 crypto-list. At press time, Dogecoin (DOGE) is trading 40% higher at its new all-time high of $0.42 and a market cap of $54.05 billion. Over the last week, Dogecoin has registered a solid rally and

The post DogeCoin (DOGE) Enters the Top-5 Crypto List With New All-Time High of $0.42 appeared first on Coingape.

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Despite a major market correction on Sunday, April 18, meme-coin DOGE has bounced back very strongly to enter the top-5 crypto-list. At press time, Dogecoin (DOGE) is trading 40% higher at its new all-time high of $0.42 and a market cap of $54.05 billion.

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Over the last week, Dogecoin has registered a solid rally and an unprecedented move in history. Just in a week’s time, the DOGE price has surged 6x or a massive 500% making it among the top-five cryptocurrencies of the world.

It is surprising to note that the meme-inspired cryptocurrency has bounced back as strongly from the market crash that other giants seemed to fail in front of it. even if we see the Sunday’s price nation for DOGE, the coin hasn’t been much shaken with the market crash. The coin hardly corrected 9% and bounced back from $0.31 levels.

More importantly, DOGE’s performance against BTC has been exemplary. Although Bitcoin (BTC) touched an all-time high above $64,000 last week, the DOGE/BTC pair is currently at an all-time high.

Courtesy: TradingView

The Frenzy Around Dogecoin (DOGE)

As the craze around Dogecoin (DOGE) unfolds, there have been multiple different things that have emerged recently with the Dogecoin rally. Last Friday, a major investors’ rush caused some technical difficulties on Robinhood as investors were unable to place orders.

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There were also rumors that Robinhood had been restricting Dogecoin trading just as it did with the GameStop rally earlier this year. However, Robinhood clarified that this was not true, and it solved the technical difficulties in matter of a few hours.

On the other hand, Wall Street veteran and Galaxy Digital founder MikeNovogratz also compared the Dogecoin rally with the GameStop (NYSE: GME) event. Speaking about Dogecoin he said:

 It doesn’t really have a purpose. It’s gotta community and maybe they can keep value there. I would be very very very worried if one my friends was investing in Dogecoin at these prices”.

Interestingly, as it turns, Reddit group WallStreetBets behind the GameStop rally started a discussion thread on Dogecoin but later pulled out of it after media hype.

To keep track of DeFi updates in real time, check out our DeFi news feed Here.

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Source: https://coingape.com/dogecoin-doge-enters-the-top-5-crypto-list-with-new-all-time-high-of-0-42/

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NEO price analysis: What’s next after massive surge to $133?

Neo price was trading more than 1,500% up when it touched intraday highs of…

The post NEO price analysis: What’s next after massive surge to $133? appeared first on Coin Journal.

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Neo price was trading more than 1,500% up when it touched intraday highs of $133

Neo (NEO) price has gained more than 40% in 24 hours to see it trade at its highest level since February 2018. In reaching intraday highs of $133, Neo’s value against the US dollar was a mouth-watering 1,534% up since mid-April 2020.

Selling has seen the coin pare some of its gains to trade around $115 as of writing. Despite this, Neo’s price remains nearly 90% up over the week and about 500% higher year to date.

What contributed to Neo’s price gains?

Neo has been in an uptrend for much of the past year thanks to strong demand as it moves towards a network upgrade. The blockchain network is also one of the few open-source projects that enjoys massive support in China; with the latest upside coming on the back of reports that China had given a nod to Bitcoin and other cryptocurrencies as investment tools.

Apart from Neo (NEO), another cryptocurrency that has gained from the news is VeChain (VET). The 13th ranked VET has soared 17% in the past 24 hours to trade above $0.25.

Neo price analysis

Neo price daily chart. Source: TradingView

NEO/USD has been in parabolic mode since breaching resistance at $68 on 14 April. After forming a cup and handle pattern, Neo broke upward and posted five consecutive green candles through to 18 April. The daily chart shows bulls managed to buy the sell-off, although bears still hover around as indicated by the red candlestick.

While the MACD is increasing in the bullish zone, the daily RSI has begun to flip downwards. Sustained profit booking might see sellers take advantage and seek to push prices lower. This scenario puts the immediate target at $100, while 25% pullback points to the 20-day EMA ($74).

However, as the overall picture remains bullish for NEO/USD, another leg up is likely. If this happens, it is possible bulls could target a retest of $133 before pushing for short-term goals of $150-$180.

Coinsmart. Beste Bitcoin-Börse in Europa
Source: https://coinjournal.net/news/neo-price-analysis-whats-next-after-massive-surge-to-133/

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Bitcoin Recovers but Faces another Rejection at $57,000 Resistance Zone

BTC price recovers after plunging to $50,500 psychological price level. For the past 48 hours, Bitcoin has been rising as buyers attempt to breach the resistance at $57,000. The current uptrend is likely to face further resistance on the upside.

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Apr 19, 2021 at 11:17 // News

Bitcoin price rebounded above the $56,000

BTC price recovers after plunging to $50,500 psychological price level. For the past 48 hours, Bitcoin has been rising as buyers attempt to breach the resistance at $57,000. The current uptrend is likely to face further resistance on the upside.

For instance, on April 7, BTC price rebounded above the $56,000 support as price rallied to breach the $58,000 resistance. Bitcoin will resume upside momentum if buyers reclaim the $58,000 support. BTC/USD will have price acceleration above the $58,000 support. 

Presently, Bitcoin is facing rejection at the $57,000 and $58,000 resistance zones. There is a tendency for price to fall again. In previous price action, Bitcoin bulls fail to break and sustain an upward move above the $58,000 support. This is in the first week of April before the recent breakdown. The resistance level has always been broken with strong bullish momentum. However, if buyers scale above the $58,000 resistance, they are likely to face stiff resistance between $61,825.84 and $65,000. Meanwhile, Bitcoin is trading at $56,987.10 at the time of writing. 

Bitcoin indicator reading  

Bitcoin bulls are struggling to sustain above the 50-day SMA. However, a break below the 50-day SMA will mean further downward movement of price. BTC price has fallen to level 43 of the Relative Strength Index period 14. It indicates that BTC price is in the bearish trend zone and capable of falling.

BTC_-_Coinidol_(14).png

Technical indicators:  

Major Resistance Levels – $65,000 and $70,000

Major Support Levels – $50,000 and $48,000

What is the next direction for BTC/USD?

BTC price is in a downward move but has reached bearish exhaustion. In the meantime, Bitcoin is facing another rejection at the $57,000 resistance zone. Meanwhile, on April 16 downtrend; a retraced candle body tested the 38.2% Fibonacci retracement level. This retracement indicates that the market will fall to level 2.618 Fibonacci extension or the low of $53,697.30. From the price action, Bitcoin fell to $50,500 low and pulled back to the Fibonacci level.

BTC_-_Coinidol_2_chart_(12).png

Disclaimer. This analysis and forecast are the personal opinions of the author that are not a recommendation to buy or sell cryptocurrency and should not be viewed as an endorsement by CoinIdol. Readers should do their own research before investing funds.

Coinsmart. Beste Bitcoin-Börse in Europa
Source: https://coinidol.com/bitcoin-57000-resistance/

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