Predictive markets rollicked with U.S. ballot counting. Two more crypto payments cards are expected to market. Nearly $1 billion worth of BTC moved from a long-dormant wallet potentially connected with the shuttered Silk Road exchange.
Ethereum 2.0’s deposit contract is now live, as of 15:00 UTC. According to developer Afri Schoedon, the deposit contract (a bridge between the forthcoming proof-of-stake (PoS) blockchain and the current proof-of-work (PoW) mainchain) is the first physical implementation of Eth 2.0 for everyday users. On a practical level, Ethereum stakers can now begin depositing the 32 ether (ETH) required to stake on Eth 2.0. Once 16,384 validators have deposited funds equivalent to a total of 524,288 ETH into the contract, the Beacon chain – the spine of Ethereum 2.0’s multiple blockchain design – will kick into action in what is called the “genesis” event of Ethereum 2.0. That event is expected within the next few weeks.
On the road again
A wallet possibly belonging to early dark net market Silk Road moved almost $1 billion worth of bitcoin early on Wednesday, according to blockchain intelligence firm Elliptic. Nearly 70,000 BTC were transferred to an unknown wallet. This is the first transaction from the address since 2015 when it transferred 101 BTC to BTC-e – a now-shuttered cryptocurrency exchange allegedly favored by money launderers, per the post. “These funds likely originated from the Silk Road,” Tom Robinson, co-founder of Elliptic noted in a LinkedIn post, adding that the coins may have been moved by imprisoned Silk Road operator Ross Ulbricht or a Silk Road vendor.
ZenGo, a wallet company, will be the latest to join Visa’s Fast Track program, with plans of launching a crypto-integrated payment card for the U.S. in early 2021. Using multi-party computation (MPC), ZenGo’s wallet, and eventual card, will allow users to convert their cryptocurrency into fiat so it can be spent in the Visa network and withdrawn from ATMs – without having to put their cryptographic keys into third-party custody. Visa’s Fast Track program has previously sponsored Bitcoin’s Lightning Network and rewards app Fold. Separately, China’s UnionPay, the world’s biggest credit and debit card company, has teamed up with a Korean payments firm to offer its Paycoin cryptocurrency for an upcoming virtual card offering.
Bitcoin’s mining difficulty dropped by more than 16% in its latest programmatic adjustment, the largest percentage decrease since the advent of ASIC mining machines in late 2012. Now at its lowest level since June, a drop in difficulty, preceded by the end of China’s rainy season, bitcoin miners are expected to see increased profits. Margins “for efficient miners will significantly widen,” John Lee Quigley, director of research at HASHR8, wrote, adding that less efficient miners will be able to mine profitably again. Mining difficulty is a measure of the amount of resources required to compete for mining fresh bitcoin, which changes roughly every two weeks based on changes to the total estimated hashpower consumed.
Bitcoin miner Layer1 Technologies is being sued by a co-founder who claims he invested millions of dollars and was then forced out of the firm. In a complaint filed in the U.S. District Court in the Western District of Texas Pecos Division, the plaintiff, Jakov Dolic, claims he co-founded Layer1 with its CEO Alexander Liegl, with the assumption the firm would be able to raise $50 million from investors for a bitcoin mining facility. Though the investments never arrived. Dolic said he invested $16.24 million of his own funds to purchase a power substation as well as a further $3.5 million to expand the power facility – and now says the funds should be refunded, per a contractual agreement.
- An Australian senator said blockchain technology could help facilitate “one touch” government and tighten financial regulation. (CoinDesk)
- Telegram will pay some $620,000 in legal fees after conceding defeat in its copyright lawsuit related to the messaging apps “GRAM” token ticker. (Decrypt)
- Hong Kong plans to ban retail investors from buying crypto. (Modern Consensus)
- Blockchain analytics firms have privacy advocates worried. (CoinDesk)
- Atari token falls 70% just days after public sale concludes. (Cointelegraph)
- Binance said has recovered nearly all $345,000 worth of cryptocurrencies stolen in an October scam that launched on its Binance Smart Chain. (CoinDesk)
Ethereum miners’ income more than halved in October as DeFi mania dropped off. Ethereum users paid $57.49 million in transaction fees in October – down 65% from September’s record monthly tally of $166.39 million, according to data source Glassnode. Further, the maximum “gas” price declined from 5.18 million gwei to 0.6 million gwei in October, according to data source Bitquery. “Transaction costs declined as volumes on decentralized exchanges dropped, reducing demand for network’s bandwidth,” Alex Mashinsky, CEO and founder of crypto lender Celsius, told CoinDesk. Trading volume on decentralized exchanges fell by nearly 25% to $19.4 billion in October to register the first monthly decline since April.
What happens to the prediction markets?
With the U.S. presidential election hanging in the balance, one thing has become clear: The primary sources for predictive election analysis – mainstream media and pollsters – will see their worth and trust degrade following a significant miscalculation leading up to Nov. 3.
What was predicted to be a possible blowout election for former Vice President Joseph Biden has turned into a nail-biting count in a few swing states. With clear “paths to victory” giving way to “toss ups,” many in the crypto industry turned their attention to predictive markets instead. The theory hinges on the bet that those with “skin in the game” (re: cold, hard cash) might yield greater insight.
In the lead up to the election, CoinDesk reported that volumes on decentralized crypto prediction markets boomed. Polymarket, a non-custodial platform where users place bets in the dollar-backed stablecoin USDC, saw volumes surge from zero to almost $3 million in a three-week span. Other crypto-based platforms, like YieldWars and Augur also began attracting attention, after long periods of dormancy.
Of course, the interest in trustless betting occurred amid a greater surge in use of centralized platforms like PredictIt. More than $1 billion had been locked into various prediction markets seeking to determine who will enter the Oval Office come January.
In the tumult of state-by-state ballot counts, prediction markets saw many take bets that President Donald Trump would keep his office – reversing a trend that previously favored Biden.
Noted industry venture capitalist Nic Carter tweeted last night that “trump is way overpriced at 68c” on FTX’s in-house prediction market. $TRUMP, a bet that the U.S. president would prevail ultimately crossed $.80 before tanking by press time.
All this is to say, election oddsmakers are just as fickle as the polls, though in different ways. In an election where crypto largely stayed out of the picture – both as a matter of candidate mandates and as a figure of political contributions – betting markets are just another alpha-seeking avenue.
Prediction markets are more entertainment than anything, Carter said over Telegram. “Generally though they are a useful albeit lossy compression of news, especially in volatile situations that are hard to parse (like last night).”
“Betting markets are not great barometers. I went to several PredictIt meet-ups in 2016. The big guns were daytraders who just wanted to day trade more. There is no secret sauce there. Sometimes they’re right, sometimes they’re wrong, but oracular they are not,” NBC News reporter Ben Collins weighed in.
Even less certain? The future of decentralized prediction markets.
YieldWars’ pseudonymous co-founder, Owl, previously told CoinDesk that the sudden rise in trading volume was to be expected, given the weight of the election. Though it’s unclear if this will last.
“Crypto-based prediction markets should be flourishing on blockchain right now but have failed to deliver up to this point. The election has breathed life into prediction markets but what is going to happen when it ends? Are people going to be as enthusiastic about them?” Owl said.
Thieves Stole About $450,000 from Crypto Trader at Knifepoint
A Hong Kong woman has fallen victim to a gang of robbers after conducting a crypto transaction worth almost $450,000.
Gang of Four Steal $450K From Hong Kong Crypto Trader
According to a report by the South China Morning Post, a female crypto trader was held at knifepoint by a gang of thieves, who stole HK $3.5 million ($448,700) from the victim.
As part of the robbery operation, one of the thieves posed as a prospective cryptocurrency buyer. The woman had earlier conducted different crypto transactions for the man, ranging between HK$600,000 and HK$700,000.
Hong Kong authorities stated that the trader sold Tether (USDT) tokens to the man via her iPhone and was later lured to an office to receive payment in cash. Shortly after receiving the money, other members of the gang held the trader at knifepoint to steal the money and her iPhone.
Authorities were able to get wind of the robbery after the victim contacted her husband with a second phone, who in turn called the police. Meanwhile, authorities are conducting a search for the gang.
The woman’s uncle, who escorted her to the location of the transaction, also told the police that he saw four men fleeing the scene of the crime.
The details of the attack also closely resemble another incident from earlier in January when a gang of four robbers stole HK $3 million from another crypto trader. In the earlier case, the hoodlums also posed as prospective buyers, completed a few transactions to gain trust before pouncing on their victim.
Armed Robbers and Kidnappers on the Prowl for Crypto Owners
Physical crypto-related thefts are reportedly a regular occurrence in Hong Kong, with the number of such incidents doubling between 2019 and 2020. Indeed, the growing value of cryptocurrencies seemingly provides incentives for armed robbers looking for victims.
Back in 2018, a police officer in India was among a group of people arrested in connection with the kidnapping and extortion of a businessman to the tune of over $49 million.
CryptoPotato compiled a list of crypto security tips for investors and traders to safeguard their wallets and crypto. One of the important things to consider is keeping your holdings private and be very careful when it comes to peer-to-peer transactions.
3 key reasons why Polkastarter (POLS) price rallied 500% since December
Polkastarter (POLS) is a cross-chain token pool and auction protocol built on the Polkadot (DOT) blockchain. It launched in October of 2020 as a way for projects to raise capital in a decentralized environment and since January the token has rallied 500% to a new high at $1.78.
Three possible reasons for the recent growth of POLS are the strong rally seen from Polkadot, strategic partnerships and exchange listings and an expanding list of token launches via auctions.
The rise of Polkadot
The rising popularity of the Polkadot network is arguably the most significant influencer on the price of POLS. Similar to Kusama, Polkastarter’s association with Polkadot could attract additional user and investor attention.
Polkadot’s rally began on Dec. 27, 2020, and it culminated on Jan.15 as DOT saw a 75% price increase in one week. POLS strong rally also reignited on Dec. 27 and followed a similar trajectory to DOT.
Now that DOT has flipped XRP to become the fourth-largest cryptocurrency by market cap, further price strength for Polkadot has the potential to have a positive impact on the overall performance of Polkastarter.
Exchange listings and partnerships
Prior to Jan. 14 POLS was only available on Uniswap and Poloniex. At the time its liquidity was limited and high ETH gas fees also complicated matters for those thinking about trading the token.
After the Huobi exchange announced plans to list POLS on Jan. 14, its trading volume increased from an average of $2 million to $22 million overnight.
Now the POLS community is working on being listed at OKEx and a recent tweet from the project informed supporters that the project only needs 2,000 more votes to qualify.
Listing POLS on another high-volume exchange has the potential to further boost the token’s price as more people will have access to one of the fastest-growing Polkadot based projects.
Successful auctions and token launches
Similar to the initial coin offerings (ICO) that occurred in 2017 and 2018, Polkastarter is gaining momentum due to its ability to attract capital heavy investors looking for the opportunity to get first access to the newest blockchain projects.
Polkastarter’s protocol is designed to enable cross-chain token pools and auctions as a method of raising capital in a decentralized fashion. To date, the platform has conducted 12 separate Initial Decentralized exchange Offerings (IDOs) with 20 different pools consisting of both public and private offerings. To date, only one pool failed to sell out.
The strong rally seen from DOT has only increased the desire of projects wanting to develop on top of Polkadot in order to capitalize on its growing popularity as well as avoid the challenges associated with building on Ethereum.
Tosdis, the most recent IDO conducted on Polkastarter, tweeted the following after its successful auction as an example of the platform’s growing popularity:
“We are really delighted to announce that our IDO on Polkastarter is sold out. POLS pool was sold out in record 30 seconds. After fixing some overloading and gas issues, the public pool was sold out in 90 minutes. We are overwhelmed by the support. Thank you and Stay tuned.”
Polkadot’s rise, successful IDOs on the Polkastarter platform and the listing of POLS on new exchanges have helped propel the value of the token to new highs and investors are optimistic that these strong fundamentals will push the price higher.
In addition to these fundamental factors, Ether’s (ETH) recent surge to a new all-time high has many analysts calling for the start of a new ‘altcoin season’. According to Raoul Pal, the CEO and co-founder of Real Vision Group and Global Macro Investor, traders are likely to plow into “higher risk alts” after Ether secures a new all-time high.
If this prediction does come to pass, it could also mean even brighter days are ahead for the Polkastarter ecosystem.
Latest CME Report Reveals Growing Appetite for Bitcoin Amongst Institutions
- Bitcoin has been consolidating within the $30,000 region throughout the past few days and weeks
- Bulls and bears have largely reached an impasse, with buyers and sellers both being unable to spark any trend
- This comes as large institutional inflows show some signs of tapering, with these buyers largely being viewed as the ones responsible for the recent market-wide surge
- The latest Commitment of Traders (CoT) report from the CME reveals a striking trend – institutions are increasingly adding to their long exposure
- This seems to invalidate the notion that institutions are slowing their accumulation habits and may point to an imminent wave two of buying from these parties
Bitcoin has seen mixed price action as of late, with the selling pressure in the upper-$30,000 region slowing its ascent as bulls and bears largely reach an impasse.
Where the crypto market trends in the mid-term may depend largely, if not entirely, on whether or not Bitcoin can continue stabilizing or break above $40,000.
Any strong rejection here could cause the crypto to see some notable losses that potentially lead altcoins to follow suit and selloff as well.
One positive trend that seems to bode well for Bitcoin’s outlook is growing long-exposure from institutions using the CME.
This trend suggests that institutions are still pouring money into the market.
Bitcoin Stagnates as Consolidation Phase Persists
At the time of writing, Bitcoin is trading up just under 2% at its current price of $36,700. This marks a notable decline from daily highs of nearly $38,000 set just a couple of hours ago.
The entire market retraced with BTC, but ETH and other altcoins are all trading up significantly from where they were just a few days ago.
Institutional Traders Are Increasingly Long on BTC
One positive trend for Bitcoin is the growing presence of institutions in the market, which is a large part of why it has been rallying so heavily throughout the past few months.
Although they may be bidding less aggressively on BTC as it hovers around its all-time highs, data from the CME’s latest Commitment of Trader’s report indicates that long interest for BTC amongst institutions is steadily climbing.
“12 – January CME $BTC Commitments of Traders (COT) report – Open Interest: 12,039 up 6.5%”
Image Courtesy of Unfolded. Source: TradingView.
The coming few days should shine some light on whether or not the constant rejection seen by Bitcoin in the upper-$30,000 region will have any impacts on its mid-term trend.
Featured image from Unsplash. Charts from TradingView.
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