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Bitcoin Market Dynamics See Change After BTC Reward Halving

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One month has passed since the 2020 Bitcoin (BTC) miner reward halving, and a lot has happened for the predominant cryptocurrency since then. From changes in investor and trader behavior to an exponential growth in institutional interest, the halving seems to have marked the start of a new reality for all Bitcoin market participants.

Although the halving did not come with the immediate price surge that many had associated with the event, there are a few key factors that indicate the start of some changes that may be here to stay, some of which may even be pivotal for the future of Bitcoin as a new asset class. 

In fact, some believe that 2020 has all the fundamentals to be a great year for Bitcoin in terms of price and visibility. A recent report by Bloomberg even expects Bitcoin to outperform its record prices from 2017 and go as high as $28,000. Recently, Simon Dedic, a co-founder of cryptocurrency analysis company Blockfyre, even went as far as to say that $150,000 could be a target in the case of a bull run

Institutional interest

Although the start of 2020 showed decreasing volumes for regulated Bitcoin derivatives on the Chicago Mercantile Exchange, this trend seems to have been completely reversed following the halving, which came shortly after veteran hedge fund manager Paul Tudor Jones showed his appreciation for Bitcoin and revealed a stake in the digital asset, stating: “The best profit-maximizing strategy is to own the fastest horse. If I am forced to forecast, my bet is it will be Bitcoin.”

Data from Skew reveals that Bitcoin derivatives on the CME started to post record figures shortly after the halving. This trend continued throughout the month of May. According to the CryptoCompare May exchange review, volumes for CME Bitcoin derivatives soared 59% and hit $7.2 billion. The document reads:

“CME total options volumes reached an all-time monthly high of 5986 contracts traded in May. This figure represents 16 times that of April’s volumes. CME futures volumes have also recovered since April, increasing 36% (number of contracts) to reach 166,000 in May.”

Following the news of the 3iQ Bitcoin fund listed on the Toronto Stock Exchange roughly a month before the halving, Grayscale revealed that their crypto funds brought in over $500 million in the first quarter of 2020, signaling that institutional interest continues to populate headlines. 

On June 10, the London-based ETC Group announced the listing of the first crypto exchange-traded product on Germany’s Xetra digital stock exchange and a recent survey published by Fidelity has found that more than one-third of institutional investors globally are long on digital assets like Bitcoin, with 80% of all investors surveyed finding this asset class appealing to some degree. Cointelegraph asked Jonathan Hobbs, the chief operating officer of digital asset hedge fund Ecstatus Capital, for his views regarding the rationale behind the recent institutional interest in BTC. Hobbs stated:

“The Fed’s bond buying program has increased its balance sheet by about $6 trillion since the 2008 financial crisis, with about half of that coming from its fourth round of QE earlier this year. As a result, more investors are seeing Bitcoin as a potential hedge against inflation. The Bitcoin halving has certainly played into this narrative. Institutions are also seeing Bitcoin as an uncorrelated asset with good risk to reward.”

Decoupling from traditional markets

Correlation with traditional markets, both in stocks and gold, has been a major point of discussion in the Bitcoin world and one that intensified greatly before the halving and following the Black Thursday crash on March 12. While some pointed to the correlation between Bitcoin and the stock market as a breaking factor for the “digital gold” comparison, it’s worth noting that all markets tended to trade in a fairly correlated manner amid the coronavirus crisis.

While the correlation between the Bitcoin and stock markets remains and with Bitcoin’s correlation with the S&P 500 having reached its highest point since January 2011, data suggests that the relationship between major markets and Bitcoin tends to shifts just before and after each halving event, which means that investors may continue to see a decoupling from stocks in the second half of 2020, especially as the effects of the pandemic decrease. 

In fact, Bitcoin has been outperforming the stock market in the second quarter, boasting returns of more than 50%. According to Matt D’Souza, CEO at Blockware Solutions and hedge fund manager, the correlation may come back as Bitcoin matures as an asset class. He stated:

“I think as more institutions get involved, the more correlated bitcoin will get with other assets. when the same people start owning the same assets or have access to the same assets is when you start to see correlations develop.”

Derivatives are growing — looming danger?

While institutional interest and relation to legacy markets can serve as an outlook of what lies ahead for Bitcoin following its third halving, the unregulated market continues to dominate BTC, particularly derivatives, which have seen substantial growth in terms of trading volume. Although volume has been rising, market data doesn’t seem to point to a clear price direction following the pre-halving bearish trends. 

According to CryptoCompare, global derivatives trading increased by 32% in May, reaching an all-time high of $602 billion. Much like previous months, options continue to see an increasing demand, with the Deribit Options volume rising by 109% to $3.06 billion in May.

As derivatives keep growing, some seem to be worried they can cause unnecessary volatility due to highly leveraged positions that cause long squeezes, where a sharp drop in price causes positions to be liquidated and brings the price further down, a scenario that was also witnessed during the March 12 crash.

Concerns that the growing interest in Bitcoin derivatives will lead to an unhealthier market do not stop there. Su Zhu, the CEO of Three Arrows Capital, recently stated that patterns like the one observed on June 1, dubbed the “Bart Simpson” pattern due to its resemblance to the cartoon character, are mostly due to the volume and interest on Bitcoin derivatives exchanges that allow for manipulation:

“I see it as the fact the vast majority of Bitcoin being held off these exchanges […] and it’s not being traded around, so a very small amount of the Bitcoin that are out there are moving the price.” 

A “Bart Simpson” pattern in BTC

A “Bart Simpson” pattern in BTC

On-chain metrics paint a pretty picture

In fact, on-chain metrics have also showcased that these patterns have been connected to large movements by a few whales to Binance and BitMex. CryptoQuant CEO Ki Young Ju previously stated: “Multiple significant BTC inflows from Binance and BitMEX a few hours before the dip.”

While large inflows to derivatives exchanges and liquidated positions on said exchanges are a concern for the future price of Bitcoin, on-chain metrics also reveal another bullish sign for the digital asset. Investors are moving their Bitcoin away from exchanges in record-breaking numbers, a factor that has preceded positive price action for BTC before.

In the week after the halving, reserves across 17 major exchanges totaled 1.18 million BTC — the lowest value since November 2018 — signaling that investors are planning to hold their BTC for some time. On June 8, an additional 27,000 BTC was withdrawn from exchanges than was deposited. The last time there was such a significant outflow, Bitcoin appreciated by 88%.

Stablecoins

The day after the halving also marked the day that United States dollar-backed stablecoin Tether (USDT) surpassed XRP as the third-largest cryptocurrency by market capitalization, according to the Stablecoin Index. The growth in USDT follows its trend from pre-halving days, and still accounts for ~98% of all BTC-to-stablecoin volume.

Research has shown that there’s a positive relationship between the issuing of USDT and the Bitcoin price, and although stablecoin volume slowed down in April and May, according to CryptoCompare, the growth in USDT issuance still bears a positive outlook for the short and medium-term. Brian Quinlivan, marketing and social media director at cryptocurrency data provider Santiment, recently told Cointelegraph:

“When people aren’t using USDT, they most often put it in Bitcoin. And what’s cool is the fact that this USDT percentage often fluctuates a few hours or days in advance of BTC’s price reacting to it. So monitoring this metric in advance can end up producing a tremendous advantage by catching a sudden fluctuation early enough.”

The road ahead

Although only one month since the Bitcoin halving has passed, things seem to be heating up for Bitcoin as institutional interest soars alongside general derivatives volume. One week after the event, data from crypto data company The TIE showed Bitcoin’s sentiment is the highest that it has been since 2017. 

Several data points hold bullish signs for Bitcoin, but instability and market manipulation are still a major challenge, especially as more serious players continue to join its market. Changes in the way investors and traders are looking at Bitcoin are bound to have a long- to medium-term impact on the price action of BTC as more people decide to hold the asset and acquire stablecoins as a gateway into crypto. A decoupling from traditional markets may also bring new developments to Bitcoin as a new asset class, although this may change as investors decide in which category this digital asset should be placed.

Source: https://cointelegraph.com/news/bitcoin-market-dynamics-see-change-after-btc-reward-halving

Blockchain

Bitcoin in uptrend but BTC may never beat gold’s $10T market cap — ex-NYSE head

Thomas Farley, former chief operating officer of the New York Stock Exchange, is “sanguine” about recent price action.

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Bitcoin (BTC) is on a “lower left to upper right trend” and its volatility should not scare investors, the former head of the New York Stock Exchange says.

In an interview with CNBC on June 23, Thomas Farley revealed long-term convictions about Bitcoin and dismissed concerns over BTC price losses.

Bitcoin: Going up, but not “up only”

Coming a day after CNBC pundit Jim Cramer admitted that he sold his Bitcoin stash, suggesting that BTC/USD was going as low as $10,000, Farley provided some much-needed mainstream bullishness.

“With respect to the recent price moves, I’m kind of sanguine about them — Bitcoin’s a very volatile asset class, in part because it’s a new asset class,” he told the network.

“I have no doubt it’ll go up, it’ll go down over the long term — I still think it’s a lower left to upper right trend and I think we’re going to see that play out over five years.”

With mining upheaval coming from China still on everyone’s lips, popular mainstream criticism of Bitcoin’s energy usage was also swiftly cast aside as a temporary issue.

“I think this kerfuffle is an interesting conversation, but by and large I think it’ll be resolved because I think the blockchain at its core adds to its efficiency and in fact will add to energy efficiency over time,” he continued.

Less convinced on gold. vs. Bitcoin

When it comes to Bitcoin as “digital gold,” however, Farley was more conservative in his predictions.

Now firmly beneath a trillion-dollar market cap, Bitcoin must transform in order to take on store-of-value safe-havens.

Related: Joining the ranks: Bitcoin’s correlation with gold and stocks is growing

“I think the upper bound for now is gold, which is about a $10 trillion market cap,” he added.

“In order for Bitcoin to one day exceed gold, it’ll have to be more of an accepted form of currency — I’m not sure, frankly, if it ever gets there.”

Proponents argue that Bitcoin, by its very nature, faces just a matter of time before eclipsing gold thanks to the latter’s ultimately infinite supply and inability to beat Bitcoin in all aspects of “money.”

The precious metal saw a major sell-off last week after comments on policy from the United States Federal Reserve.

To beat gold, Bitcoin would need to trade at more than $533,000 with the current supply.

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Source: https://cointelegraph.com/news/bitcoin-in-uptrend-but-btc-may-never-beat-gold-s-10t-market-cap-ex-nyse-head

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Ally Has Price Boost of 48% – Where to Buy Ally

Ally price (ALY) has seen its trading volume spike by over 436% in the…

The post Ally Has Price Boost of 48% – Where to Buy Ally appeared first on Coin Journal.

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Ally price (ALY) has seen its trading volume spike by over 436% in the last 24 hours.

Ally, a cryptocurrency-powered secure messaging platform, has seen its price spike by almost 50% in the last 24 hours.

As concerns over privacy and fear of surveillance rises, platforms such as Ally seek to fulfil the demand for trusted means of communication.

Whatsapp, the most popularly used encrypted messaging service, has recently changed its terms of service now it is owned by Facebook, leading some to fear that the social media giant is looking for new ways to monetise Whatsapps’ user data.

Where to buy Ally

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What makes Ally a potential buy?

In the last year to date, buyers of Ally would be in profit by an enormous 4,021%. To put this in perspective, a $100 investment a year ago would have now grown to be worth thousands of dollars.

Ally claims that it has strong fundamental value, as it is “focused on providing users the most secure and decentralized online communication solution. With private P2P chats, group chats, broadcast channels, ephemeral messaging, and crypto transfers, Ally offers a multitude of features to ensure users have the richest experience possible.

As the first dApp built on Skrumble Network’s public blockchain, Ally is primed to be the go-to communication application for managing crypto communities, discussing sensitive political matters, and exploring a variety of fun and engaging topics.

If backlash against some of the more established messaging services takes off, then Ally could certainly be a project to watch over the coming years if users look to flock to a new platform.

Coinsmart. Beste Bitcoin-Börse in Europa
Source: https://coinjournal.net/news/ally-has-price-boost-of-48-where-to-buy-ally/

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Digital Assets AG Launching Stock Tokens on Solana

Digital Assets AG is launching tokenized stocks on the Solana Blockchain, which will be exclusively available though crypto exchange FTX.

The post Digital Assets AG Launching Stock Tokens on Solana appeared first on BeInCrypto.

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Digital Assets AG is launching tokenized stocks on the Solana Blockchain, which will be exclusively available though crypto exchange FTX.

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Digital Assets AG (DAAG) is based in Switzerland and specializes in designing and issuing tokenized financial instruments. It is now bringing its tokenized stock infrastructure to the Solana blockchain. During this initial debut, DAAG will also launch the free-floating security tokens exclusively on crypto exchange FTX. This will allow for the risk-free, compliant transfer of tokenized stocks.

According to Brandon Williams, Corporate Development Lead at DAAG, “operating on Solana will offer a much more efficient, and cost-effective environment for the trading and utilization of tokenized stocks.”

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Secondary-market stock token trading

In April, Binance became the first major exchange to offer stock tokens, in partnership with DAAG. Binance inaugurated its stock token offerings with Tesla, but later added MicroStrategy, Microsoft and Apple to its portfolio. However, these stock tokens are limited to being traded on Binance exclusively, with users only able to open or close positions. This restricts their ability to make withdrawals, or transfer cross-chain or to an external party. 

But now, DAAG has also launched free-floating tokenized stocks on Solana. This means that users can now trade these tokens between different centralized and decentralized exchanges built on the Solana blockchain. Sam Bankman-Fried, founder and CEO of FTX said that this could set a new standard and “help facilitate a paradigm shift in the underlying market structure.” 

Regulatory approval

Initially, these stock tokens will be exclusively available on crypto exchange FTX to KYC’d buyers and sellers in permitted jurisdictions. Users will be able to buy, sell and withdraw the 55 free-floating stocks in a 24/7/365 trading cycle. These will include stock tokens for Facebook, Google, Netflix, Nvidia, PayPal, Square and Tesla. Users will also be able to make transfers to secondary markets without restriction, with near-instantaneous settlement and no counterparty risk.

These free-floating tokens are regulatory-approved security tokens that can be used for tokenized stock trading. Each stock token is worth one share of stock, backed by a corresponding share in a portfolio of underlying securities. Previously, there had been some issue with Binance’s stock tokens, about whether they required a securities’ prospectus. However, in this instance the Financial Market Authority (FMA) of Liechtenstein endorsed a securities’ prospectus, making DAAG Tokenized Stocks valid in the European Economic Area (EEA).

Disclaimer

All the information contained on our website is published in good faith and for general information purposes only. Any action the reader takes upon the information found on our website is strictly at their own risk.

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Nick is a data scientist who teaches economics and communication in Budapest, Hungary, where he received a BA in Political Science and Economics and an MSc in Business Analytics from CEU. He has been writing about cryptocurrency and blockchain technology since 2018, and is intrigued by its potential economic and political usage. He can best be described as an optimistic center-left skeptic.

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Source: https://beincrypto.com/digital-assets-ag-launching-stock-tokens-on-solana/

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CryptoPunt Announces World’s First Effort at Truly Decentralized Gambling

The concept of gambling has undergone multiple iterations over the years. What started out as an illegal practice is now considered legal physical and online entertainment in numerous regions. The role of cryptocurrencies in this segment cannot be underestimated, as decentralized gambling is the next step in the evolution to a truly fair ecosystem.

The post CryptoPunt Announces World’s First Effort at Truly Decentralized Gambling appeared first on BeInCrypto.

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The concept of gambling has undergone multiple iterations over the years. What started out as an illegal practice is now considered legal physical and online entertainment in numerous regions.

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Sponsored

The role of cryptocurrencies in this segment cannot be underestimated, as decentralized gambling is the next step in the evolution to a truly fair ecosystem.

Crypto gambling is on the rise

Over the past few years, there have been numerous initiatives to combine the best of online gambling and cryptocurrencies. Digital assets provide pseudonymity, improve accessibility, and are widely accepted among casino and gambling providers. It is a payment method that protects both users and providers alike, operating outside the control of banks and governments. 

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Whereas the initial push was focused on centralized platforms accepting cryptocurrency payments, that is no longer the case today. Decentralization is the new norm, although it is not always straightforward to achieve. Decentralized gambling applications have gained some momentum over the years, although they mainly cater to existing cryptocurrency enthusiasts. That approach is successful, but it will do very little to convince the mainstream of this option.

That is a bit strange, as crypto gambling also introduces the concept of provable fairness. Allowing all users to verify the outcome of a wager independently creates an unprecedented sense of empowerment. Removing the need to rely on the service provider to confirm whether an outcome is both fair and crucial. The gambling industry has always had a transparency issue, but that can be resolved by innovative projects such as CryptoPunt.

The potential of CryptoPunt

As a platform focusing on gambling and gaming, CryptoPunt goes well beyond traditional crypto casinos. It will support initial games such as Blackjack, Jackpot, and CoinFlip, whilst continuously adding many more entertaining options whose outcomes are always recorded on-chain, staying true to the crypto ethos of decentralization. All bets are recorded on the Polygon Matic ecosystem, a layer-two solution for the Ethereum blockchain. 

Onboarding new users is essential in the decentralized gambling industry. Making this process as straightforward as possible is crucial, and CryptoPunt checks the right boxes. It requires no traditional registration but rather a connection through a Web3 wallet like MetaMask or Coinbase Wallet, forgoing manual deposits/withdrawals, KYC procedures, and other cumbersome aspects. On that count, this solution is far more approachable than most other gambling options on the market today.

Another crucial benefit of dealing with cryptocurrencies is how it leads to faster deposits and withdrawals. For CryptoPunt users, those transactions are instant. The platform is not responsible for the payments, as it maintains a non-custodial solution. User winnings appear directly in one’s wallet, speeding up the transactions and enhancing the control users can experience.

All of this sounds good on paper, but it wouldn’t be worth much without a convenient user experience. CryptoPunt offers a sleek gaming interface to minimize navigational delays and increase the overall gaming enjoyment. The interface looks very intuitive in its current beta version, yet more touch-ups will be introduced prior to the full release.

The PUN token’s purpose

As is courtesy in the cryptocurrency industry, new platforms will usually have a native token. For CryptoPunt, that token is $PUN, rewarding affiliate marketers with a revenue share from referrals. It also grants access to exclusive promotions and better platform rates. In the future, PUN will be useful for accessing prizes and plenty of other incentives. 

On the referral front, markets earn 0.1% of every bet made by referrals. That offer applies to games against house only. Additionally, there is a reduced house edge for PUN holders, allowing for bigger profits to be pocketed when winning. Community members will be able to increase their holdings through various community-oriented campaigns running on Telegram, social media, and so forth. There is also an in-game chat where holders must hold $PUN to deter scammers approaching them in-chat.

Given the backing by renowned VCs, including VYSYN Ventures, DutchCryptoInvestors, CryptoMarvels, ChinaPolk, BMW Capital, and others, there is a lot of attention on CryptoPunt and its PUN token, with the launch leading up to be a success. Unlike other tokens, $PUN supports both the ERC-20 and BEP-20 token standards, an industry first. With trading to go live on PancakeSwap and Uniswap, there will be broad access to the token and overall liquidity, whilst also allowing inter-chain bridging.

Closing thoughts

It is evident there are numerous ways to decentralize the gambling industry further. Rather than just focusing on the decentralized aspect of the games, CryptoPunt goes one step further by creating a sleek and massively entertaining experience, fit for the current state of the online gambling market. Its non-custodial solution for deposits and withdrawals creates a direct line of communication between players and CryptoPunt, whereas its modular features and focus on user-friendliness can make a big difference when catering to millions of players globally.

Provably fair gambling and gaming will become more commonplace over the coming years. Users need the ability to verify the outcome of wagers without relying on the service provider to share details that may or may not be accurate. The dual-pronged approach through gambling and gaming is a breath of fresh air in the decentralized gambling world, as the model caters to the needs of millions of people rather than just cryptocurrency enthusiasts.

Disclaimer

All the information contained on our website is published in good faith and for general information purposes only. Any action the reader takes upon the information found on our website is strictly at their own risk.

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Source: https://beincrypto.com/cryptopunt-to-offer-truly-decentralized-gambling/

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