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Bitcoin Miners Largely Responsible For Latest Rejection At $10K

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Bitcoin price has been consolidating in the mid to high $9,000 range for nearly a month and a half. Repeated attempts to break and hold above $10,000 have been rejected thus far.

The most recent rejection, data shows, was largely fueled by miners who were seen moving BTC supply to exchanges just ahead of the most recent steep selloff. Is this miners capitulating, or simply taking advantage of high prices each time the cryptocurrency reaches the key resistance level?

Are Miners Responsible For The Latest Crypto Market Selloff?

In early 2020, Bitcoin and other cryptocurrencies went on strong rallies from lows set in the year prior.

All signs had been pointing to a new uptrend forming. Indicators had been supporting the incredibly bullish sentiment and price action.

Bitcoin price began to cool off after a visit above $10,000, but then the black swan impact of the pandemic struck financial markets, and all bullish price action leading up to the high was erased in under 48 hours.

The carnage is now referred to as Black Thursday.

Related Reading | Bitcoin Slides As Greater Financial Market Is a Sea of Red, How Far Will BTC Drop? 

From the extreme panic low, Bitcoin price has grown over 140% and revisited above $10,000 numerous times.

Each time it’s pushed above the powerful resistance level, it has led to a strong rejection, the last of which, data indicates may have been driven by Bitcoin miners.

But why the sudden surge in selling post-halving? According to theories related to the halving, miners should be holding any new BTC mined not selling, so why is the inverse now happening?

Miner Capitulation And Competition May Be Purposely Pushing Bitcoin Prices Lower

Data analyzing the amount of BTC supply mining pools hold flowing into cryptocurrency exchanges shows an especially large movement preceding the most recent crash in Bitcoin price.

Speculation suggests that this Bitcoin was later market sold, causing the price of the asset to drop as a result.

Miners have been long expected to hold newly mined BTC post-halving, throwing off supply and demand, which could cause the start of a new uptrend in the digitally scarce asset.

Instead, however, miners have been selling even more BTC, even tapping into reserves.

While the halving could ultimately have the expected effect on the price per BTC, it may first require the weakest mining participants to capitulate and close up shop for good.

This also may be what is happening, according to the data, and a surge in miners moving funds to exchanges.

Miner profit margins live and die by the market value of Bitcoin versus the cost of production. When Bitcoin price heavily outweighs energy and operating costs, mining is extremely profitable.

But for miners who don’t have access to cheap energy, or aren’t large enough for the efficiency needed for profitability, the halving may have destroyed any chance of having a surviving business model.

Because the halving immediately reduced the block reward miners receive for securing the network from 12.5 BTC to just 6.25 BTC, the cost of production doubled instantly also.

This has put the weakest miners at a strong disadvantage due to Bitcoin price remaining under $10,000.

bitcoin hash ribbons miners

Indicators measuring the health of the Bitcoin network point to miners capitulating due to the substantial blow to profit margins. If Bitcoin price drops lower, miners may have zero choice but to sell or suffer major losses.

Another theory is that it is actually the strongest miners selling in an attempt to force the capitulation of the weakest miners by pushing prices lower.

Related Reading | Bitcoin Miner Capitulation Reaches Black Thursday Levels, Is A Severe Selloff Looming?

A temporary hit to their own, currently sustainable margins, could eliminate the competition for them for years to come.

Whatever the reason for the selling, it isn’t necessarily bearish for Bitcoin. The more weak miners are cleansed from the network, the healthier mining pools will be and the more likely they will be to hold BTC supply for later mark up during the next bull market.

Source: https://www.newsbtc.com/2020/06/13/bitcoin-miners-rejection-at-10k/?utm_source=rss&utm_medium=rss&utm_campaign=bitcoin-miners-rejection-at-10k

Blockchain

Mode Adds Bitcoin to Reserves, Joining Microstrategy and Square

A UK-based fintech firm has just announced a large purchase of bitcoin using its cash reserves. Mode Global Holdings, an already bitcoin-friendly financial company, has become the first UK publicly traded firm to allocate part of its reserves to the cryptocurrency. The announcement follows those of Microstrategy and Square. As many cryptocurrency industry observers suspected, […]

The post Mode Adds Bitcoin to Reserves, Joining Microstrategy and Square appeared first on BeInCrypto.

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A UK-based fintech firm has just announced a large purchase of bitcoin using its cash reserves. Mode Global Holdings, an already bitcoin-friendly financial company, has become the first UK publicly traded firm to allocate part of its reserves to the cryptocurrency.

The announcement follows those of Microstrategy and Square. As many cryptocurrency industry observers suspected, Microstrategy’s August revelation appears to now be inspiring others.

Currency Debasement Prompts Mode to Invest 10% of Cash Reserves

First, there was Michael Saylor’s Microstrategy. Then, came Jack Dorsey’s Square. The two companies adding BTC to their balance sheets reveal an emerging appetite for bitcoin as protection against inflation and economic crises.

Mode is the latest publicly-listed company to realize bitcoin’s importance. The UK fintech firm announced the decision via press release on Wed 21 Oct.

Mode has reportedly allocated 10% of its cash reserves on its balance sheet to bitcoin. Motivating the decision is the uncertain global macro-economic outlook in the wake of the coronavirus pandemic.

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The firm says that the bitcoin allocation is an effort to protect the assets of investors from currency debasement. It mentions record low UK interest rates of 0.1% in its justification.

The company recently completed an IPO in which it raised £7.5 million. The press release states that the decision to invest in bitcoin is an effort to “maximize the value of returns” from its IPO.

Despite its recent investment foray into bitcoin, Mode is no stranger to the digital asset. It describes itself as “the bitcoin banking app.” It also sells BTC, as well as the ability to generate interest from holdings.

Another Public Company Finds Refuge in BTC

As mentioned, Mode is by no means the first publicly-listed company to take on exposure in bitcoin. Illustrating this shift is Microstrategy CEO, Michael Saylor. In 2013, Saylor publicly dismissed bitcoin on Twitter:

After eventually doing some research into the cryptocurrency this year, Saylor completely changed his mind.

Recent appearances on various industry podcasts, along with passionate tweets like that below, have quickly elevated the CEO to legendary status in Bitcoin circles:

Whereas Bitcoin previously appeared to represent a tool for criminals, it’s now emerging as a hedge against macro uncertainty. Like Mode, both Microstrategy and Square cited their own concerns about fiat currency debasement in the wake of unprecedented coronavirus stimulus packages around the world.

The nature of these businesses lends themselves to such investments. Both Square and Mode are well-accustomed to the cryptocurrency industry, having both offered BTC exposure for some time.

In the case of Microstrategy, the board of directors is just five-strong with Michael Saylor controlling around 72% of the voting power. It, therefore, would have been much more likely for Microstrategy to invest in BTC compared to other publicly-listed companies.

Some industry observers believe that this is just the beginning of a steepening institutional adoption curve.

Source: https://beincrypto.com/mode-adds-bitcoin-to-reserves-joining-microstrategy-and-square/

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Has Bitcoin met its match with this altcoin?

The feud between Bitcoin and Ethereum is a long-standing one. ‘Feud’ isn’t exactly the right word for it. Perhaps, the communities have fought over which is the superior coin for quite some time. Howe

The post Has Bitcoin met its match with this altcoin? appeared first on AMBCrypto.

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The feud between Bitcoin and Ethereum is a long-standing one. ‘Feud’ isn’t exactly the right word for it. Perhaps, the communities have fought over which is the superior coin for quite some time. However, comparing BTC and ETH is like comparing apples to oranges, while both may be fruits, both are different and alike in their own way.

Here are a few examples:

  1. Bitcoin is more ‘money’ than Ethereum. Bitcoin’s major focus was to be an alternative payment system to the US dollar. Hence, payment/value transfer is the main focus of Bitcoin, while with Ethereum, there are a plethora of use cases that range from smart contracts, building dapps, the world computer, etc.
  2. Bitcoin is an asset that has higher s2f  which is its main attraction/selling point to the global audience. Bitcoin can hold value [aka store of value] and is digital gold, hence, this narrative is quite alluring to the investors. As for ETH, people may find it hard to grasp Ethereum as a blockchain.

While fundamental differences are many and can be elaborate, here are comparisons of an on-chain metric that tries to show the differences between the two.

  1. Bitcoin addresses worth $1 hit a new high of 24 million, and so is the same with ETH addresses holding $1 ETH at 21.4 million.

Source: Coinmetrics

While ETH isn’t far away it still needs to catch up with BTC.

2. BTC addresses that hold less than $10 is at a whopping 16.45 million whereas, for ETH, this number is at 6.51 million. The gap is huge but is not out of the purview of Ethereum.

Source: Coinmetrics

Conclusion

This is both good and bad, depending on how one views it.

On the bright side, Bitcoin has had the 1st mover advantage, however, ETH has almost caught up with bitcoin even though it was launched in 2015, 2016. Considering ETH’s much-awaited and much-delayed ETH 2.0, these numbers could easily be overpassed, should ETH successfully move to ETH 2.0.

To conclude, comparing these coins is counter-cyclical. Bitcoin’s goal is much different than what Ethereum intends to do, so comparing them would be a wasted effort. While the two, as mentioned, are different from each other, trying to build a gateway between the two would benefit both the ecosystem better.

Source: https://eng.ambcrypto.com/bitcoin-and-ethereum-is-one-better-than-the-other

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Blockchain

Yearn Finance Adds GUSD Vaults and Updated Keep3r Network Details

Yearn Finance, one of the leading Defi protocols has recently made an addition on Gemini Dollar (GUSD) vaults to its platform.

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Yearn Finance, one of the leading DeFi protocols, has recently made an addition on Gemini Dollar (GUSD) vaults to its platform. The firm has not yet revealed any strategies or potential earnings from this new addition to the platform. It is recently reported that the other four stablecoin pools on the platform have seen some yearly growth.

This new addition by Yearn Finance is appreciated by Cameron Winklevoss, founder of Gemini exchange. He seems to be quite delighted by this move and believed that the future belongs to the DeFi sector.

Yearn Finance Founder’s Github Updated With More Details

It is also reported that Github of the founder of Yearn Finance recently got updated with the additional details on the Keep3r network. It is believed that this is going to act as a smart contract job platform for all the projects that require some extra operations. Here the job is used for smart contracts that require an entity to perform actions. It is also mentioned that the network will be powered by KPR tokens and these tokens are issued as rewards against job completion. 

Daniel Lehnberg Explored How Protocol Should be Considered 

There has been a lot of discussion regarding this protocol by the Yearn Finance and Daniel Lehnberg has also explored how this protocol needs to be considered.  In the end, it is specified that it is actually not even a company and is not having any shareholders. It indicates that this protocol is not in a good position at present. It is reported that Yearn Finance has again slumped by 14% this week and is currently around the $13,000 mark. This position is still seen as a loss because it is 63% less the all-time weekly high of YFI which was around $37,000 back in September.

READ  BCH Proponent Releases Stamp Chat, Prototype Of Layer-2 On Bitcoin Cash

#Cameron Winklevoss #Daniel Lehnberg #GitHub #GUSD vaults #Keep3r network #KPR tokens #yearn.finance

Source: https://www.cryptoknowmics.com/news/yearn-finance-adds-gusd-vaults-and-updated-keep3r-network-details

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