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CryptoPunks are taking over Miami

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Nearly 100 characters from the popular crypto-collectibles project CryptoPunks will be displayed across bus shelters and billboards in Miami for one month from April 12.

The showcase will be hosted by non-profit art organization SaveArtSpace as part of its exhibition “Pixelated” — a month-long city-wide public art exhibition that will take over the streets of Miami for the first time this year.

In addition to the 96 characters that will be on display across the city, the popular NFTs will also be displayed during the event as part of a pop-up exhibition of CryptoPunks in partnership with art equipment retailer Blackdove at 69 East 41st St, Miami on April 15.

CryptoPunks was one of the first non-fungible token projects created on Ethereum, having launched in 2017.

The project mints tokens featuring unique cartoon characters that have varying value depending on the rarity of the features they possess. All 10,000 CryptoPunks were minted when the project launched and were made available to be claimed for free.

The tokens have since exploded in popularity to fetch exorbitant prices, with CryptoPunk 6965 — which depicts an ape in a brown hat — selling for 800 ETH worth more than $1.5 million in February, and Punk 2890 — which depicts a blue alien in a purple hat — selling for 605 ETH worth more than $750,000 in January.

Punk 6965: cryptoslam.io

SaveArtSpace stated they are aiming to display the “variety and depth” of the CryptoPunks, noting the project symbolizes individual expression through the use of social media profile pictures:

“Much the same way one’s style allows them to express themselves in the real world, in communities and organizations across the Internet, people began to display their individuality with their profile pictures. It was in this digital expression that CryptoPunks really began to thrive.”

SaveArtSpace is a non-profit that works on creating urban gallery experiences that focus on progressive themes such as intersectionality and social change.

The organization speculates that while nonfungible tokens have existed for several years, the increasing digitization of daily life amid the coronavirus lock-downs may have been the catalyst for the recent NFT boom:

“The ongoing Global Pandemic has upended people’s way of living, changing the world forever in an instant. Like our ancestors before us, we had to adapt quickly or perish. Although NFT’s have been around for many years, it wasn’t until this recent move to a more digitally focused life, that they really began to flourish.”

“By bringing these pixelated versions of our online lives to the real world, we hope to show to the world the very human side of this technological revolution,” they added.

This is not the first time CryptoPunks have ventured out into the real world. In November 2019, the project’s co-creator, John Watkinson, printed and signed 12 punks that were put up for sale in a Zurich art gallery.

Coinsmart. Beste Bitcoin-Börse in Europa
Source: https://cointelegraph.com/news/cryptopunks-are-taking-over-miami

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BTC December futures reach $73,500 — Is everyone flipping ultra bullish?

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Bitcoin (BTC) has been struggling to break the $60,000 resistance for almost a month. But despite the impasse, BTC futures markets have never been so bullish. While regular spot exchanges are trading near $59,600, the BTC contracts maturing in June are trading above $65,000.

Futures contracts tend to trade at a premium, mainly on neutral-to-bullish markets, and this happens on every asset, including commodities, equities, indexes, and currencies. However, a 50% annualized premium (basis) for contracts expiring in three months is highly uncommon.

BTC futures curve, in USD. Source: bitcoinfuturesinfo.com

Unlike the perpetual contract — or inverse swap, these fixed-calendar futures do not have a funding rate. Thus, their price will vastly differ from regular spot exchanges. Fixed-calendar futures eliminates eventual funding rates’ spikes from the buyers’ perspective, which can reach up to 43% per month.

On the other hand, the seller benefits from a predictable premium, usually locking longer-term arbitrage strategies. By simultaneously buying the spot (regular) BTC and selling the futures contracts, one gains a zero-risk exposure with a predetermined gain. Thus, the futures contracts seller demands higher profits (premium) whenever markets lean bullish.

The three-month futures usually trade with a 10% to 20% versus regular spot exchanges to justify locking the funds instead of immediately cashing out.

OKEx BTC 3-month futures annualized premium (basis). Source: Skew.com

The above chart shows that even during the 250% rally between March and June 2019, the futures’ basis held below 25%. It was only recently in February 2021 that such phenomena reemerged. Bitcoin surged by 135% in 60 days before the 3-month futures premium surpassed the 25% annualized level on Feb. 8, 2021.

While professional traders tend to prefer the fixed-month calendar futures, retail dominates perpetual contracts, avoiding the expiries’ hassle. Moreover, retail traders consider it expensive to pay 10% or larger nominal premiums, even though perpetual contracts (inverse swaps) are more costly when considering the funding rate.

BTC coin-based perpetual futures funding rate. Source: Bybt.com

While the recent 0.20% funding rate per 8-hour is extraordinary, it is definitely not unusual for BTC markets. Such a fee is equivalent to 19.7% per month but seldom lasts more than a couple of days.

A high funding rate causes arbitrage desks to intervene, buying fixed-calendar contracts and selling the perpetual futures. Thus, excessive retail long leverage usually drives the futures’ basis up, not the other way around.

As crypto-derivatives markets remain largely unregulated, inefficiencies shall continue to prevail. Thus, while a 50% basis premium seems out of the norm, one must remember that retail traders have no other means to leverage their positions. In turn, this causes temporary distortions, although not necessarily worrisome from a trading perspective.

While exorbitant funding rate fees remain, leverage longs will be forced to close their positions due to its growing cost. Thus, December’s $73,500 contract does not necessarily reflect investors’ expectations, and such a premium should recede.

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.

Coinsmart. Beste Bitcoin-Börse in Europa
Source: https://cointelegraph.com/news/btc-december-futures-reach-73-500-is-everyone-flipping-ultra-bullish

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Bitcoin mining company follows Tesla by setting up shop in Austin

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North America-based crypto mining company Blockcap announced over the weekend it would be establishing new offices in Austin, Texas.

In an announcement from Blockcap on Friday, the mining company claimed once its new facilities are operational in the Lone Star State’s capital, its hashing power will be roughly 3.5 exahash per second from a total of 42,000 rigs, reportedly doubling its capabilities. According to blockchain data, this would represent more than 2% of the hashrate for the entire Bitcoin (BTC) network, roughly 167 million terahash per second at the time of publication. However, Blockcap claims its total fleet will account for only 1% of the network’s hashing power.

“Austin is our home base from which we will pursue our mission and bring this great city closer to the center of the United States’ blockchain technology ecosystem,” said Blockcap chair and founder Darin Feinstein. “We also see the city as an ideal location from which to continue expanding our operations as we grow at both national and international levels.”

Blockcap cited electric car manufacturer Tesla setting up one of its “Gigafactories” in Austin in announcing the move. Tesla CEO and billionaire Elon Musk recently purchased a home in the Texas state capital for more than $3 million on Lake Austin west of the downtown area, while the firm is breaking ground on the Gigafactory on the east side closer to the Austin-Bergstrom International Airport.

The mining company did not immediately respond to questions regarding where it plans to establish its offices in the Austin area or how many jobs would be created as a result, though Feinstein said it would be “hiring locally.” Musk said in a tweet last month that the new Giga Texas location would bring in more than 10,000 jobs, effectively increasing the number of employees at the electric car manufacturing company by more than 14%.

Though some tech companies like Oracle and Hewlett Packard are moving to Austin — causing many to dub the city the “Silicon Hills,” in reference to Silicon Valley — the state capital has in many ways become a microcosm of the U.S. housing market. Many employees of these firms may be seeing all-cash buyers purchasing homes, making them unavailable to those with only the financial means of saving for a 20% down payment. Musk highlighted the dearth of Austin housing in an April 4 tweet, seemingly in reference to Tesla employees relocating there.

However, the addition of Blockcap and other blockchain firms to the Lone Star State has the support of former Texas governor Rick Perry, the Republican politician who once famously forgot the name of the Department of Energy as a federal agency he would eliminate if elected president. Perry claimed Texas had “become the premier location for forward-looking industries like blockchain” and that Blockcap would likely lead to job creation and economic growth in the state.

Founded in 2020 by a group of blockchain veterans, Blockcap now controls roughly 12,000 mining rigs generating more than 7 BTC daily, or $416,550 at the time of publication. The company raised more than $75 million in two funding rounds led by Off The Chain Capital and Foundry Digital. According to Blockcap, the firm recently acquired more than $500 million worth of Bitcoin mining machines.

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Source: https://cointelegraph.com/news/bitcoin-mining-company-follows-tesla-by-setting-up-shop-in-austin

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Binance Coin (BNB) market cap passes Santander and UBS — What’s next?

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2021 has been an impressive year for Binance Coin (BNB), which so far has rallied by more than 900%. 

One of the primary drivers of BNB’s growth was continued congestion on the Ethereum network. As this struggle carried on, Binance Smart Chain (BSC) emerged as an alternative, meeting the rapidly growing decentralized finance (DeFi) sector’s demands.

As BNB reached a $64 billion market capitalization, it has surpassed traditional banks, including Santander, the Bank of Montreal, and UBS. Meanwhile, some analysts point to the estimated value and impact of Coinbase’s upcoming direct listing ($100-billion valuation) as a catalyst for the BNB price hike.

A common narrative spun up over the past few weeks is that the direct listing of COIN is also adding value to centralized exchange tokens. Analysts are also speculating that other U.S.-based regulated exchanges like Kraken and Gemini will likely follow Coinbase’s path and attempt to raise funds through a stock offering.

To understand BNB’s potential, one must first understand the differences between equities (stocks). After this is cleared up, it will be possible to analyze the possible drivers of BNB’s appreciation.

BNB does not represent shares of Binance

BNB token provides holders with a discount on trading fees, and it is required for those wishing to participate in Binance Launchpad token sales. As BNB gained liquidity, it also became a base pair for other cryptocurrencies at Binance exchange.

Over time, other uses emerged as the Binance Smart Chain gained traction. For example, BNB can cover network fees and as serve as a utility token in the ecosystem, which includes decentralized apps (dApps) and games.

Periodically Binance burns (destroys) some of the non-circulating BNB tokens based on the exchange’s overall trading volume. This strategy’s efficacy vanished over time as investors understood that these destroyed tokens never entered the circulating supply.

The Binance Smart Chain network uses a Proof of Stake Authority which eliminates the need for miners or expensive transaction fees. The platform kept its compatibility with the Ethereum Virtual Machine (EVM) and has a similar token and smart contract structure.

Many tokenized (or pegged) cryptocurrencies have gained relevance in Binance’s networks, allowing users to bypass miner fees. Another benefit provided by Binance Smart Chain’s BEP-20 model is staking and farming capabilities in its vast network of decentralized applications, including the PancakeSwap DEX and Venus lending platform.

Decentralized Finance Total Value Locked ranking. Source: DeBank

As shown above, Binance Smart Chain has been gaining ground on other DeFi protocols in terms of total value locked. Thus, new use cases for the BNB token emerged to take center stage as farming, liquidity pools, and base pairs utilized the token throughout the network.

Banks are reliable dividend providers, but DeFi could overtake the system

Equity shareholders are entitled to a piece of a listed companies’ net earnings. This amount will vary between each quarter, as the board of directors may opt to repay debt or incorporate some of that money into reserves. However, banks are known cash cows and thus usually a reliable source of dividends payouts.

Santander (SAN) dividends paid over the last 12 months divided by the current stock price yield a 3.7% gain, and Bank of Montreal (BMO) shareholders received a similar yield. Switzerland-based UBS yields went down in 2020, but historically it has averaged 5%.

Bank shareholders effectively have voting rights in shareholders meetings, and minority groups could block measures that would hurt them financially. On the other hand, these equity holders are 100% dependent on the bank’s net income and growth.

BNB, on the other hand, could survive without the direct influence of Binance exchange. In the future, if Binance Smart Chain achieves independent developers and validators, its ecosystem might continue to thrive. In theory, if token loses its dependency as the ecosystem grows, becoming less centralized.

If done correctly, BNB’s market capitalization could surpass that of the entire traditional banking system, but before this can happen these networks and decentralized applications need to gain adoption and prove that they can stand up to the needs of mainstream investors and banking clients.

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.

Coinsmart. Beste Bitcoin-Börse in Europa
Source: https://cointelegraph.com/news/binance-coin-bnb-market-cap-passes-santander-and-ubs-what-s-next

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