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What Drove Crypto’s Growth in 2020-21

What Drove Crypto’s Growth in 2020-21

What Drove Crypto’s Growth in 2020-21When the world was first introduced to Bitcoin, it didn’t receive the universal acclaim it deserved. However, despite facing over a decade of criticism head-on, Bitcoin, cryptocurrencies, and blockchain technology as a whole have come out on top. It’d be inaccurate to say this all happened naturally – but while there were undoubtedly external forces

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When the world was first introduced to Bitcoin, it didn’t receive the universal acclaim it deserved. However, despite facing over a decade of criticism head-on, Bitcoin, cryptocurrencies, and blockchain technology as a whole have come out on top. It’d be inaccurate to say this all happened naturally – but while there were undoubtedly external forces at play, crypto’s growth over the last year has been largely organic. At the end of the day, a decentralized ecosystem is only as strong as its participants.

The last year has been peppered with innovative products and services that seemingly popped out of nowhere. The recent boom in decentralized finance feels unprecedented, but analysts saw this coming years ago. The total value locked into the DeFi space was at $700 million at the start of 2020 and is currently chasing an $80 billion market capitalization.

The cryptocurrency space is settling into an era of sensibility. Market participants are slowly categorizing different tokens depending on what they represent. Bitcoin currently represents digital gold – a safe haven asset to hedge against global economic risk, fiat currency risk, inflation, and more. Ethereum and its ETH token represent the burgeoning smart contract ecosystem, especially with almost every DeFi application being deployed on it.

While smaller-cap cryptocurrencies offer exponential growth, they also afford investors an equally high amount of risk. With Bitcoin hovering around the $50,000 level, it’ll be much harder to see the ‘sick gainz’ people have been harping on about for the last ten years investing in BTC, but it’s a much safer bet to make than ever before.

While the ‘total value locked’ or TVL metric has faced much criticism concerning what it actually represents, anything manifesting steady growth to over a hundred times its original value in a little over a year is unquestionably impressive. However, DeFi isn’t the only trend that’s been fuelling crypto’s growth over the last year, and on closer analysis, blockchain’s growth could be coming from a place rooted in more long-term adoption.

At the start of last year, Bitcoin was still deciding whether it was worth $10,000. A burst of positive sentiment in January saw BTC rise to $13,000 before gradually sloping to under $5,000 by May’s end. They say the night is always darkest just before dawn. Bitcoin is now twelve times more valuable, having grown from a market capitalization of just $86 billion a year ago to over $1 trillion today.

The blockchain industry is going through a fundamental change. Many of its components are evolving at once, signaling an ecosystem that’s shifting gears. Ethereum 2.0 Phase 0 officially launched late last year, and while its most important features like sharding haven’t been implemented yet, the Proof-of-Stake network’s Beacon Chain is now live – a feat thought improbably by many a few years ago.

Progress has been the name of the game for quite some time. The years since the 2017 ICO bubble have seen blockchain-based projects putting their thinking caps on to figure out tangible ways to deliver value with DLT. Though bearish momentum plagued most of 2018 and the latter half of 2019, the industry was only gearing up for the phase we’re currently in.

One of the biggest challenges for cryptocurrencies in the near to medium term is adoption. Decentralized networks rely on their communities more than any other network, and without a steady influx of users, critics claim that mainstream adoption is but a mirage in the hot atmosphere of blockchain hype. However, the utility and applications for blockchain are becoming limitless, with mainstream financial services and even national governments progressively adopting and integrating with the technology.

“There are many roadblocks to widespread adoption, but perhaps the one of the most significant that we see is education. Many people still simply do not know much about this field,” says Jack Tao, CEO of global cryptocurrency exchange Phemex. “Misunderstanding and lack of knowledge will continue to hinder the potential for rapid growth.”

The Singapore-based exchange, created by a team of ex-Morgan Stanley veterans in late-2019, has quickly made its way into the top crypto derivatives platforms in the world. Just last month, Phemex also announced the introduction of KYC services on the platform. 

Not only does this make them fully compliant with all crypto-related regulatory policies, but they are also registered as a Money Services Business (MSB) with FinCEN (the Financial Crimes Enforcement Network Department), to help further put its customers’ minds at ease. Cryptocurrency markets have billions of dollars being transferred across decentralized networks every day, and having the proper infrastructure to ensure secure and reliable transactions is paramount to active participation.

Decentralized exchanges sound great in theory, but there’s still a lot of work to be done. Unaudited code can have drastic consequences, and with countless new decentralized exchanges popping up every day, a little brand value couldn’t hurt.

“I don’t see this new field of exchanges as a threat but rather a complimentary service that can easily coexist with centralized exchanges,” the Phemex CEO added.

Relative to Q1 2020, Phemex also reported an impressive 465.2% rise in trade volumes over the same period this year, and a 156.9% increase in traders since 2020’s final quarter.

More Money, More Projects

Decentralized finance was built for the decentralized world we live in today. The COVID-19 pandemic has propagated a risk-off market mentality, but with economies slowly recovering and money pouring into the blockchain space, DeFi platforms have become perfect outlets for traders to take some risks. Even at the pandemic’s peak mid-last year, the hype behind DeFi’s yield farming took the whole community by storm.

Though it’s safe to say decentralized exchanges (DEXs) made their proper debut in the market last year, centralized exchanges aren’t backing down. Automated Market Makers (AMMs) may have made DEXs faster, but having an intermediary to make sure all proceedings are in everyone’s best interests is more valued than you’d expected.

2020 saw a noticeable reduction in the number of cryptocurrency thefts, reporting a near 60% decline from the previous year. 2019 saw over $4.5 billion lost to crime — nearly three times as much as 2018’s $1.7 billion – but this steady reduction in crypto theft doesn’t come from humans becoming better people.

Though Bitcoin’s growth had a massive impact on the global crypto market capitalization, its dominance over the space has been steadily dropping since the start of this year. Having reported an 84% dominance in January, BTC’s current hold over the space is a little over 50%. The broader cryptocurrency space has a market cap of over $2 trillion, rivaling some of the biggest companies in the world and even the GDP of some small countries.

Institutional interest has also picked up, with large companies and hedge funds all looking to benefit from the space’s exponential upside. With more money entering the industry, projects will soon be able to take advantage of development and management resources better, leading to more rapid progress in the field of decentralized networks.

To put things in perspective, the total funds raised through ICOs in the two years since 2017 is just shy of $20 billion – 1% of the entire cryptocurrency market capitalization in 2021. The cryptocurrency industry’s recent growth has been the culmination of efforts bubbling beneath the surface over the last few years, and now with capital and confidence, the world is finally putting blockchain to work.

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Source: https://btcmanager.com/what-drove-crypto-growth-2020-21-2/

Blockchain

What Ethereum traders need to be cautious of

Ethereum’s price has been on a downtrend ever since its peak in May. Although its correlation has dropped with Bitcoin, the altcoin was still a part of a volatile market. ETH’s value has depreciated b

The post What Ethereum traders need to be cautious of appeared first on AMBCrypto.

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Ethereum’s price has been on a downtrend ever since its peak in May. Although its correlation has dropped with Bitcoin, the altcoin was still a part of a volatile market. ETH’s value has depreciated by 55% since May and was currently trading at $1,938.

Ethereum daily chart

Source: ETHUSD on TradingView

The above daily chart indicated ETH losing support at $2,178 and dropping to support at $1,826. This slip in the value paved way for more downwards pressure in the market. This could lead to the further consolidation of ETH’s value.

Reasoning

The 50 Moving Average has remained above the price bars for a couple of weeks and it has been a sign of the level of bearishness in the market. The gap between the price bars and the MA suggested that the bearish trend will continue in the market.

The current price drop pushed ETH to the April lows and as per the Directional Movement Index, the current market was witnessing an increasing downwards pressure. The -DI and +DI reached a point of a crossover, however, the sudden sell-off pushed -DI higher. At the time of press, the -DI and +DI remained diverged, suggesting traders were keen to sell their ETH at the current price. This could be in the hope of buying yet another dip.

Meanwhile, Stochastic RSI was also seeing a battle between the signal line and the RSI line. As the two remained in the oversold zone, the RSI line taking over the signal line could suggest buying pressure in the market. This could help ETH move above the 23.60% Fibonacci retracement level. However, as the line remained intertwined, it would be difficult to guess the fate of the market.

Conclusion 

The current Ethereum market was indicative of more bearishness. This has already pushed the asset in the oversold category and to gain stability, ETH may consolidate close to its immediate support of $1,826.


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Coinsmart. Beste Bitcoin-Börse in Europa
Source: https://ambcrypto.com/what-ethereum-traders-need-to-be-cautious-of

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Blockchain

What Ethereum traders need to be cautious of

Ethereum’s price has been on a downtrend ever since its peak in May. Although its correlation has dropped with Bitcoin, the altcoin was still a part of a volatile market. ETH’s value has depreciated b

The post What Ethereum traders need to be cautious of appeared first on AMBCrypto.

Published

on

Ethereum’s price has been on a downtrend ever since its peak in May. Although its correlation has dropped with Bitcoin, the altcoin was still a part of a volatile market. ETH’s value has depreciated by 55% since May and was currently trading at $1,938.

Ethereum daily chart

Source: ETHUSD on TradingView

The above daily chart indicated ETH losing support at $2,178 and dropping to support at $1,826. This slip in the value paved way for more downwards pressure in the market. This could lead to the further consolidation of ETH’s value.

Reasoning

The 50 Moving Average has remained above the price bars for a couple of weeks and it has been a sign of the level of bearishness in the market. The gap between the price bars and the MA suggested that the bearish trend will continue in the market.

The current price drop pushed ETH to the April lows and as per the Directional Movement Index, the current market was witnessing an increasing downwards pressure. The -DI and +DI reached a point of a crossover, however, the sudden sell-off pushed -DI higher. At the time of press, the -DI and +DI remained diverged, suggesting traders were keen to sell their ETH at the current price. This could be in the hope of buying yet another dip.

Meanwhile, Stochastic RSI was also seeing a battle between the signal line and the RSI line. As the two remained in the oversold zone, the RSI line taking over the signal line could suggest buying pressure in the market. This could help ETH move above the 23.60% Fibonacci retracement level. However, as the line remained intertwined, it would be difficult to guess the fate of the market.

Conclusion 

The current Ethereum market was indicative of more bearishness. This has already pushed the asset in the oversold category and to gain stability, ETH may consolidate close to its immediate support of $1,826.


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Coinsmart. Beste Bitcoin-Börse in Europa
Source: https://ambcrypto.com/what-ethereum-traders-need-to-be-cautious-of

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Unlock of GBTC Shares Could Led Bitcoin to $25 Mark Says JPMorgan

JPMorgan analysts have predicted that the unlocking of GBTC shares could raise the selling pressure and drive the price of Bitcoin to the level of $25K.

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JPMorgan analysts have predicted that the unlocking of GBTC shares could raise the selling pressure and drive the price of Bitcoin to the level of $25K. JPMorgan revealed in their latest memo that though BTC has recovered slightly, the unlock will drive the price down to $25K.

JPMorgan Says GBTC Shares Unlocking Will Push Bitcoin Down Further

The Nikolaos Panigirtzoglou led global investment bank JPMorgan has recently displayed a contentious attitude to the flagship currency.

The analysts at JPMorgan always have an eye on what role the largest crypto asset manager, Grayscale is playing in relation to Bitcoin. 

At the beginning of this year, the analysts predicted that there are chances that the price of BTC might march towards a correction as a reduction in the inflows to the Grayscale Bitcoin Trust has been witnessed.

As revealed in the newly released memo by Bloomberg, JPMorgan has predicted another bear signal in the market involving GBTC, talking about the shares unlock of the BTC tracking fund.

The institutional investors that are employing the services of Grayscale will be obtaining access to 16K bitcoins in a single day in the month of July.

Will BTC Touch $25K

Bitcoin plunged to its lowest price levels just days ago below the area of $29K, though it managed to acquire some ground since that point and at present, it is changing hands at $32K.

JPMorgan analysts are eyeing another fall in the price of Bitcoin, and they wrote:

“Despite this week’s correction, we are reluctant to abandon our negative outlook for Bitcoin and crypto markets more generally. Despite some improvement, our signals remain overall bearish.”

In addition to this, they revealed that they believe the price of BTC is close to being overvalued, which is apparent from the comparison between its fluctuations versus that of gold.

READ  Bitcoin is the Most Dominant Digital Property Network: Michael Saylor

#Bitcoin #GBTC Shares #JPMorgan

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Source: https://www.cryptoknowmics.com/news/unlock-of-gbtc-shares-could-led-bitcoin-to-25-mark-says-jpmorgan

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Number of Active Bitcoin Addresses Drops Lowest Level Since Last Year

The number of active Bitcoin addresses seems to have dropped significantly below 900,000 in June 2021 which is the lowest level since July 2020.

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The number of active Bitcoin addresses seems to have dropped significantly below 900,000 in June 2021 which is the lowest level since July 2020, according to data published by Santiment, the crypto analytics platform.

Active Bitcoin Addresses Drops Since July 2020

Amid the ongoing bearish market trend, Bitcoin traders remain hesitant to pumping up their bags as the digital asset dropped below $30,000 during this week. Since then, the cryptocurrency has recovered some of its lost gains to jumping up above $34,000.

However, bears are back to gripping the flagship cryptocurrency yet again by making the digital asset drop down below $32,500 today.

With the bearish sentiments, the total number of active Bitcoin addresses has reached below 900,000 in June 2021, which is the lowest level since July 2020, according to data published by Santiment, the crypto analytics platform, adding:

READ  JLR Initiates Program To Offer Cryptocurrency To Drivers

“Bitcoin is back at $32.4k after a rebound above a $34.6k high Wednesday. What remains to be seen is an uptick in address activity. On the 30-day rolling scale of daily active address scale, July 13, 2020, was the last time the BTC network was this low,”

At the same time, Bitcoin’s fear, uncertainty, and doubt (FUD) remain high as highlighted by Santiment:

“Bitcoin’s fear, uncertainty, and doubt (FUD) remain high, as traders are polarized on whether prices can push back below $30k again. For now, though, prices have jumped back on crowd fear. Markets move in the opposite direction of crowd expectation.”

Falling Addressees Indicates Bearish Undertone

The number of active Bitcoin addresses is a sign of market demand for on-chain transactions, settlement, and the urgency for inclusion in an upcoming block on the blockchain. A falling Bitcoin active address figure indicates a bearish undertone in the space.

READ  ROI Of Ethereum To Crush Yearly Return Of Bitcoin, Crypto Traders Predict

For instance, in 2017, Bitcoin saw a high above $19,587 on December 16 to below $6900 on February 5, 2018, the number of active addresses also fell from 1.284 million on December 14, 2017, to just 528,000 on February 25, 2018.

At the same time, studies show that not all Bitcoin whales were affected by the price drop. In the past 25 days, Bitcoin addresses holding 100 to 10,000 BTC added a total of 90,000 BTC, accounting for nearly half of BTC’s circulating supply.

#Bitcoin #Bitcoin Address #BTC

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Source: https://www.cryptoknowmics.com/news/number-of-active-bitcoin-addresses-drops-lowest-level-since-last-year

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