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India to have a ‘window’ for Bitcoin, says minister amid crypto ban FUD

The Ministry of Finance of India continues to form a careful position on private cryptocurrencies.

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The minister of finance of India, Nirmala Sitharaman, has given a ray of hope for the Indian cryptocurrency community as more fear, uncertainty and doubt circulate regarding a supposedly impending ban on digital assets. 

In a Saturday interview with India Today, Sitharaman emphasized that the ministry does not plan to shut off Indian innovations associated with Bitcoin (BTC) and its underlying blockchain technology.

“From our side, we are very clear that we are not shutting all options off. We will allow certain windows for people use, so that experiments on the blockchain, Bitcoins or cryptocurrency […] and fintech, which depend on such experiments, will have that window available for them. We are not going to shut it off,” she said.

Sitharaman said that the ministry is finalizing a cabinet note on crypto as India continues formulating its official stance on the asset class. “It is nearing completion, and then it will be taken to the cabinet. The Supreme Court had commented on cryptocurrency. We are very clear that the Reserve Bank of India will take a call on an official cryptocurrency,” she said.

After India’s supreme court lifted a crypto banking ban one year ago, reports of a new ban started circulating in early 2021. In February, another anonymous Indian official claimed that the government was about to introduce a complete ban on crypto, giving investors up to six months to liquidate their holdings.

On Sunday, Reuters published a report citing an anonymous senior government official who claimed that India is preparing to enforce a blanket ban on crypto and impose major penalties on rule-breakers. As part of an alleged bill, India is planning to criminalize “possession, issuance, mining, trading and transferring crypto-assets,” the source claimed.

Despite reports of a ban from anonymous sources continuing to surface, Sitharaman said in early March that the ministry wants to form a “calibrated” stance on digital assets. 

Nischal Shetty, founder of local crypto exchange WazirX, seemed optimistic about Sitharaman’s comments in a tweet, stating that it is time for the Indian crypto community to build. 

The RBI and the Ministry of Finance did not immediately respond to Cointelegraph’s request for comment.

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Source: https://cointelegraph.com/news/india-to-have-a-window-for-bitcoin-says-minister-amid-crypto-ban-fud

Blockchain

Bitcoin’s Halving May Not Pump Price Like Last Time – Here’s Why It Doesn’t Matter

With sideways trading, a bearish sentiment, and a slowing two months, Bitcoin has seen a slump from $14,000 USD highs to under $7,000 USD in recent weeks. With the Bitcoin Halviening less than 6-months away, will the market change pace and fuel the bull run that we’ve all been hoping for? While camps are divided, … Continued

The post Bitcoin’s Halving May Not Pump Price Like Last Time – Here’s Why It Doesn’t Matter appeared first on CryptoCanucks.

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With sideways trading, a bearish sentiment, and a slowing two months, Bitcoin has seen a slump from $14,000 USD highs to under $7,000 USD in recent weeks. With the Bitcoin Halviening less than 6-months away, will the market change pace and fuel the bull run that we’ve all been hoping for?

While camps are divided, here’s why we believe this Bitcoin halving will be beneficial for the market and help propel the industry to new heights.

bitcoin clock

Understanding the Potential Downside:

Bitcoin halvenings occur every 210,000 blocks. This is, on average, about every four years and was likely designed as a way to maintain a stable circulating supply and avoid hyperinflation.

When this happens, a miner’s reward per block is cut in half. As the reward level for a block decreases and difficulty for the block increases (as there are more miners competing for a smaller block reward), opportunistic miners are effectively priced out of the competition. The idea is, theoretically at least, that low-end miners cannot afford to continue mining.

As rewards for the block decrease, miners need an ever more efficient way of competing in the marketplace. Those that cannot compete, sell-off Bitcoin in an effort to cut losses and take their gains.

Historically this has only happened after Bitcoin halvenings after reward blocks are cut in half. The worry is that even with low prices now, after the halvening there will be additional selloff because of reduced block rewards, and there may not be a significant upward move for Bitcoin for months to come.

donedonedone

(source: Digital Asset Research – statistical model, not price predictions)

 The above chart as an example shows what happens with the price (light blue line) after halvenings (dotted red lines) occur. What we’re seeing here, is that there was no price increase after the last halvening. Instead, the price started increasing in the middle of the cycle, suggesting that the increase may have already been priced in. Or said another way, that the price increase from $3,000 levels earlier this year, up to $12,000 levels already represent potential gains that might have otherwise occurred after the halvening.

But this is only part of the story.

Reviewing the upside:

Weeding out inefficient miners effectively helps boost the long-term health of the overall market. Both halvenings and low prices help drive this. With continued low prices, this might actually mean that we’ve already priced in ‘miner reduction’ simply because of the current sluggish Bitcoin prices. Only the most efficient Bitcoin miners can sustain a drop in price from $14k to current $7k levels. Many miners have already been forced to shut down their rigs.

Which could mean that the halvening may not force as much sell-off as initially thought.

If it does force additional sell-off, there could be a temporary downslide before a strong bullish movement forward. If it doesn’t force additional sell-off, the halvening will only support a strong bullish trend as supply is limited, rewards are halved, and only the strongest miners remain.

Industry Strength

If we take a step back and look at long-term projections, both cases are more than positive for the industry as a whole. While short-term gains may suffer in the worst of cases, the Bitcoin halvening should help drive a long-term bullish trend.

A simple supply and demand scenario is the easiest explanation, although there are many more nuanced theories.

As halvening difficulty increases, supply is reduced. As supply is reduced the cost of each Bitcoin is likely to rise due to scarcity. Additional factors, such as global economics, increased awareness about cryptocurrency, and increased demand for Bitcoin itself should add fuel to a bullish rally.

It has yet to be determined, and the narratives surrounding the halvening are mixed at best. Yet when we look at the long term possibilities on the state of the industry, two things are very clear.

One – cryptocurrency is here to stay. And two – in the long-run Bitcoin will see a bullish movement forward.

Are you ready to take advantage of the future?


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Source: https://cryptocanucks.com/bitcoins-halving-may-not-pump-price-like-last-time-heres-why-it-doesnt-matter/

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Blockchain

They see ETH rollin’: Why did Ether price reach $3.5K, and what’s next?

Attention is firmly on the short-term future of Ether after Ethereum’s native cryptocurrency surged to new all-time highs above $3,500.

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The next few months promise to be exhilarating and decisive for Ether (ETH), as its recent all-time highs above $3,500 put an even bigger spotlight on the cryptocurrency and its smart contract blockchain, Ethereum.

As the cryptocurrency markets continue to grow five months into 2021, both the preeminent Bitcoin (BTC) and a host of other blockchain projects and tokens have soared in value, chief among them being Ether. The second-biggest cryptocurrency by market capitalization has enjoyed a buoyant fortnight that has seen it rise to new heights.

Indeed, ETH went on a late-April surge, backed by several key factors that have led to a rapid price appreciation across cryptocurrency markets. The booming decentralized finance sector coupled with the burgeoning nonfungible token, or NFT, space have been attributed as major reasons for ETH’s price boom, as these technologies are mostly based on the Ethereum blockchain. However, the importance of the recently implemented Berlin upgrade and bullish ETH options traders has helped push the price of the network’s token even higher.

The booming price of ETH has also led to renewed talk of a fabled ETH–BTC “flippening,” which would see Ether overtake Bitcoin as the most valuable cryptocurrency by market capitalization. While that is still a long way off, as Ether’s $411-billion market cap is worth just 39% of Bitcoin’s $1.06-trillion market cap, ETH is increasingly catching up.

This is evident in the sheer amount of capital that is being poured into Ether by investors. CoinShares recently estimated that institutional investment managers and firms hold around $13.9 billion in ETH, with $30 million worth of ETH purchased in the last week of April and around $170 million bought over the past calendar month.

The question on the minds of cryptocurrency traders, “hodlers,” Ethereum proponents, DeFi and NFT users, and the wider community is fairly obvious: What lies in store for ETH over the next few months, and can the network keep up with the demand?

Speculatively bullish?

Maria Paula Fernandez, adviser to the board of directors of Golem Network — a protocol built on Ethereum’s second layer that facilitates computational resource sharing — told Cointelegraph that the next few months promise to be exciting given the growth up until this point.

While she was cautious to give an outright price prediction for ETH, Fernandez believes that the upcoming changes to the network will pave the way for further growth in value across the Ethereum ecosystem: “I’m in as much awe as everybody else, so out of abundance of caution, I’m having a hard time making predictions, but I can definitely say that $10k ETH is no longer a pipe dream but something that’s likely to happen.”

Fernandez agreed that the price of ETH could certainly go higher in the next two months leading up to the deployment of the hotly debated Ethereum Improvement Proposal 1559, which will form part of the London hard fork.

While the looming EIP-1559 will play an integral role, Fernandez said that Ethereum’s utility has already been proved as a better solution for various financial tools and that this is a key driver of the price of ETH. “The NFT fever coupled with 2020’s DeFi summer brought in swathes of new users and they are here to stay.” She added further:

“Now, 2021 has been proving to be the year of Layer 2 solutions, which alleviated the challenges with Ethereum’s scalability, and that, together with the incredible improvements on UX on the application layer which makes it easier to use an Ethereum-based app than, say, online banking, clearly proves ETH as fuel and as hard money for the open finance ecosystem.”

Nikhil Shamapant, a retail investor and medical resident, recently published a research report titled “Ethereum, The Triple Halving” in which he presented arguments for why he thinks ETH could see a meteoric rise in value to around $150,000 by 2023.

When asked by where ETH could be headed in the next couple of months leading up to the London hard fork, Shamapant provided Cointelegraph with an extremely bullish, and admittedly speculative, prediction for the smart contract blockchain’s native token:

“It definitely can go much higher, I think we can see the price go to $10,000, where a lot of ETH bull price targets begin to kick in and people take profits. I think we’ll head up to that $10-25k range, hit a lot of supply and could see some big drawdowns and consolidation at that point.”

Shamapant’s lofty long-term price prediction for ETH does need to be put into context. If the price of ETH were to hit $150,000, the market cap of the cryptocurrency would be around $17 trillion, considering that there is 115,764,316 ETH in circulation. Unlike Bitcoin’s finite supply of 21 million BTC, there is no supply cap for Ether, which is part of the reason that the network is looking to implement EIPs that introduce some sort of deflationary mechanism, like EIP-1559 — but more on that later.

As Shamapant unpacks in his report, things may well be ramping up as of May, but the current price of ETH and the burgeoning use of NFTs and DeFi could well be the catalyst of some serious growth for an ecosystem that he believes is still undervalued:

“NFTs and DeFi have shown a clear use case, but we’re still in the early innings. NFT quality is going to go up dramatically, DeFi usability will improve with scalability improvements to ETH2.0 — and yes, ETH is dramatically undervalued in this context.”

Fernandez gave a more subtle take on the current valuation of the Ethereum ecosystem and its native token, admitting that the network is finally realizing its potential, which is reflected in the price of ETH: “I don’t feel the network is undervalued. It was definitely undervalued before, and throughout the bear market — but I think right now it’s getting the recognition and visibility that it deserves.”

London looming on the horizon

The London hard fork of the Ethereum blockchain is expected to take place in July and will introduce EIP-1559. The upgrade has been both contentious and highly anticipated due to the changes it’s set to make to the structure of fees paid by users and earned by miners.

As Nick Johnson, lead developer of Ethereum Naming Service — a naming service for Ethereum wallets — explained to Cointelegraph, EIP-1559 will make some important changes to how fees are calculated and paid for on the blockchain:

“It [the London hard fork] will include EIP-1559, the much-anticipated rework of the transaction fee market, which will have a huge impact on user-experience sending transactions on a congested network. It will also make it possible for smart contracts to fetch the ‘base fee’ — effectively, the gas cost of the current block — which will make projects such as gas-price-derivatives and tokens possible.”

The major reason that EIP-1559 has also been labeled contentious is the built-in ETH burn mechanism that will destroy some of the Ether used to pay the associated transaction fee. This has had Ethereum miners up in arms, as receiving transaction fees has traditionally been an important incentive for miners to maintain the network by confirming transactions and bundling them into blocks.

Although EIP-1559 has met some opposition from miners, the upside promised by the reduction in fees will likely positively impact the price of and raise even more interest in Ether, which have both been nothing short of astronomical with DeFi platforms and decentralized application usage exploding in recent months.

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Source: https://cointelegraph.com/news/they-see-eth-rollin-why-did-ether-price-reach-3-5k-and-what-s-next

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Kimchi Premium on the Rise Again, Can it Pull BTC Out of Consolidation ?

Bitcoin price is currently consolidating just above $57,000 with its market dominance on a continuous decline, currently at 44.41%. Bitcoin registered a sharp correction of over $17k, falling from an ATH of $64,863 to a monthly low of $47,159. The price of the top cryptocurrency has recovered nearly half of the losses, currently 12% short

The post Kimchi Premium on the Rise Again, Can it Pull BTC Out of Consolidation ? appeared first on Coingape.

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Bitcoin price is currently consolidating just above $57,000 with its market dominance on a continuous decline, currently at 44.41%. Bitcoin registered a sharp correction of over $17k, falling from an ATH of $64,863 to a monthly low of $47,159. The price of the top cryptocurrency has recovered nearly half of the losses, currently 12% short from testing its previous ATH.

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eIntro

Kimchi premium and Coinbase premium have proven to be important market indicators this bull season, where the price of Bitcoin starts selling at a premium price in Korean markets amid growing demand. This creates a price difference between US markets and the Korean market known as Kimchi premium. Kimchi premium registered a significant drop during the last sell-off dropping to negative, but it is on the rise again as it rose to a monthly high of 11%.

Bitcoin this year has set a price pattern where it has risen to an all-time-high (ATH) every month for the past five months, followed by a sharp correction ranging between 12%-27% and then 2-3 weeks of consolidation before starting the next leg. The consolidation phase has gotten longer with each new ATH as we are entering into the fourth week of consolidation since the last ATH.

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Can Rise Kimchi Premium Pull BTC Out of Price Slumber?

With every new price correction, many have declared Bitcoin price top, but most of them overlook the on-chain fundamentals and growing adoption which doesn’t seem to stop for now. The on-chain suggest that exchange outflows have continued despite the consolidation phase, at the same time more public listed companies keep buying Bitcoin that is only going to deplete the already acute market supply of the top cryptocurrency.

Bitcoin has risen to a new ATH proving those predictions wrong. The rising kimchi premium could be the first bullish indicator for the next leg of the bull run.

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Disclaimer
The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.
About Author
An engineering graduate, Prashant focuses on UK and Indian markets. As a crypto-journalist, his interests lie in blockchain technology adoption across emerging economies.

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Source: https://coingape.com/kimchi-premium-on-the-rise-again-can-it-pull-btc-out-of-consolidation/

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Flippening? Record $10B Ethereum futures volume briefly outpaces Bitcoin’s

The volume on Ethereum futures flipped Bitcoin’s after hitting a new record at $10 billion, and derivatives data suggests further upside for Ether price.

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In the past 30 days, Ether (ETH) price decoupled from Bitcoin (BTC) to post a 67.5% gain, while the leading cryptocurrency price has barely moved. Ether’s $3,605 all-time high on May 5 was responsible for boosting the asset’s futures open interest to $10 billion.

This movement brings up some crucial questions as the dominance of Bitcoin’s derivatives markets appears to be challenged at the moment. On May 4, Ether’s aggregate futures volumes surpassed Bitcoin’s for the first time in history.

Ether and Bitcoin aggregate futures volume, USD. Source: Coinalyze

Volume data from Coinalyze shows that $2.6 billion CME Bitcoin futures traded, along with $1.1 billion in CME Ether futures on May 4. However, Ether’s aggregate volumes led by $87 billion versus Bitcoin’s $81 billion.

Some might argue that volumes aren’t as relevant as open interest, which is a fair assessment. Open interest represents the total number of contracts in play, regardless if they have been traded on a specific date. In that sense, Bitcoin still has double Ether’s $10 billion futures open interest.

Ether futures aggregate open interest, USD. Source: Bybt

The above chart shows Ether futures mind-blowing 117% increase in two months. It is also worth noticing CME’s contracts reaching a $460 million open interest, a seven-fold increase since March.

Ether’s soaring futures volume signals increasing interest from traders

To assess whether the market is leaning bullish, one should analyze its premium. The premium measures the price gap between futures contract prices and the regular spot market. This indicator is commonly referred to as basis and should indicate a 10% to 20% annualized premium.

The stablecoin lending rate is the main reason behind this discrepancy, as futures participants are withholding settlement by opting for derivatives contracts.

OKEx 3-months ETH futures basis. Source: Skew

The chart above shows that Ether’s futures premium peaked at 45% in mid-April and has since normalized near 25%. This data is very encouraging as it signals that there is not extreme optimism despite the Ether price reaching back-to-back all-time highs.

While some analysts will interpret this data as a ‘glass half full,’ others might say it represents a lack of conviction from professional traders. Regardless of the viewpoint, it is important to account for the impact of the carry trade, which negatively pressures the basis indicator.

Investors aiming for a fixed-income trade will short Ether futures contracts while simultaneously buying spot Ether.

Overall, there seems to be healthy growth in Ether’s futures markets, regardless of how one interprets the data.

As for an eventual Bitcoin open interest ‘flippening,’ this seems a long way from happening. Either way, the overall increase in cryptocurrency derivatives is beneficial for the market.

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk. You should conduct your own research when making a decision.

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Source: https://cointelegraph.com/news/flippening-record-10b-ethereum-futures-volume-briefly-outpaces-bitcoin-s

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