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The rise of crypto: Bitcoin sets landmarks but alts can go independent

Unfounded hype? This time around, investors have begun to realize the value proposition of Bitcoin and Ether.

Republished by Plato

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On Dec. 8, exactly one month ago, Bitcoin was hovering around the $18,700 range, with many analysts debating as to whether the flagship asset would be able to sustain its bullish momentum and cross its all-time high value close to $20,000. Well, how quickly things have changed since then because within a period of just 30 days, Bitcoin (BTC) has repeatedly scaled up to new ATHs, even surpassing the $41,000 barrier.

Over the course of the last seven days, BTC has exhibited a substantial growth of around 41%, with the digital asset seemingly breaking new ground with each passing day. However, this has led to investors becoming increasingly nervous since there are many who immediately are given flashbacks of the 2018 crash that resulted in most cryptocurrencies crashing hard within a matter of days.

In this regard, Cointelegraph Markets contributor Michaël van de Poppe believes that while 2020 was an amazing year for crypto, everyone should brace for a “healthy correction” in the near future. That being said, for many, that can serve as an opportunity like no other because there is an increasing population of budding crypto enthusiasts who now want a piece of the action, and not just Bitcoin. On the matter, van de Poppe opined: “The higher Bitcoin goes, the more money comes into the market and more money can flow towards altcoins.”

What’s causing BTC to soar?

The reasons for Bitcoin’s momentum are manifold, starting with the fact that the industry as a whole had been in a prolonged bear market all through 2018 and 2019, but despite the slumps, accumulation had never really stopped.

Another often overlooked narrative is related to the recent BTC halving, as time and again, historical data has indicated that approximately four to six months after every cycle, the value of the premier digital currency takes a sharp upward turn — something that has happened this time around as well.

Not only that, but the digital asset seems to be right on track with the stock-to-flow model, which was created by Dutch institutional investor PlanB. According to the S2F model, scarcity is used as the defining metric to quantify the value of Bitcoin. And while most people use the setup to assess BTCs future valuation, PlanB claims that the S2F model can also be used in relation to gold and silver, as well as other assets.

Ben Zhou, CEO of cryptocurrency exchange Bybit, confirmed that it’s the “institutional inflow fueling Bitcoin,” adding that there is now a level of consensus, or at the very least, peer pressure among certain corners of the institutional world to have Bitcoin in their portfolio: “Certainly, those that have a younger clientele feel the need to increase their exposure to BTC.”

Omar Chen, CEO of the ZB.com exchange, believes that institutional buying has simply served as a catalyst for Bitcoin and has not been the primary driver for its bullish momentum. He told Cointelegraph that investors, both from the traditional and the crypto sectors, are in fact on the lookout for alternative safe havens, pointing toward gold and its rally during the start of the COVID-19 pandemic:

“As people and institutions learn more about its attributes and benefits, Bitcoin has become another haven of choice for money. Combined with the recent spate of negative news about COVID-19 vaccines, investors are increasingly losing faith in traditional finance and the global economic recovery, making the bullish case for Bitcoin even louder.”

Are altcoins inextricably linked to BTC?

As Bitcoin marches on, even crossing the $41,000 threshold, there is no denying that the surge has also seen a number of prominent altcoins soar to new heights. In this regard, over the course of the past week, Ether (ETH), Stellar (XLM) and Cardano (ADA) have showcased prominent gains of 70%, 128% and 70%, respectively.

But will the financial destiny of the market’s top-10 altcoins always be linked to Bitcoin? So far, the value of ETH and Litecoin (LTC) have continued to showcase heavy correlation with BTC whenever the latter witnesses any major market movement. However, Ether may be coming into its own as an independent asset, even though it has yet to break past its 2018 ATH of $1,448.

Thor Chan, CEO of digital asset exchange AAX, opined that even though the term “alt season” is often used whenever Ether or some other altcoins start to surge, its meaning has changed over time. He pointed to the 2017 market when everything had to do with an explosion in innovation around initial coin offerings and about people “getting rich as quickly as possible.” Since then, he believes the market has evolved greatly: “Now, the growth in altcoins is more about portfolio diversification, risk management and rebalancing as traders realize their Bitcoin profits.”

It is worth recognizing that most altcoins, barring a few such as ETH, still largely fall outside the radar of institutional interest. However, with Bitcoin being promoted the way it has been, many mid- to large-scale investors might be looking at ETH and other prominent alts as potential candidates for the next wave of adoption. In this regard, Jay Hao, CEO of cryptocurrency exchange OKEx, highlighted to Cointelegraph:

“It is natural that there will be some spillover into other cryptocurrencies with Ethereum being the first in line as a well-established and long-term project in the industry. While BTC most certainly has the strongest brand recognition, Ethereum has not gone unnoticed, being used by the largest FSIs like JPMorgan and Santander.”

He further noted that Ether has very strong fundamentals and, as a result, has piqued the interest of serious institutional investors, such as TD Ameritrade and Arca Labs. Not only that, but Ethereum is the platform of choice for many cryptocurrency projects and has been behind the huge DeFi momentum that took off in earnest last year.

Hao believes that while Bitcoin has effectively been given the green light, as has Ether to a certain degree, from institutional investors, the same cannot be said for all other cryptocurrencies: “I don’t believe that we can say with confidence that the alt season will be as large or as long as the previous, as the majority of the institutional dollars are still flowing into BTC.”

Is the crypto hype real?

While the narrative of “Bitcoin being a bubble” is yet to play out, there are still those from the traditional finance sphere who continue to reiterate the statement as a mantra, hoping that their anti-crypto sentiments do come true at some point.

For example, just last month, renowned economist David Rosenberg told Bloomberg that he believes Bitcoin is in a bubble and investors don’t understand how its supply works, adding: “Everybody seems to believe that we’re going to get to that 21 million cap on the supply constraint, but there’s really nothing in the protocol to suggest that the supply of Bitcoin can’t go up once we hit that limit.”

Related: New Bitcoin price highs revive old misconceptions about BTC and crypto

As a wise man once said, “Facts don’t care about your feelings,” as is highlighted by the fact that the crypto industry is seeing unprecedented institutional demand for Bitcoin, especially with the entrance of many key players, such as MicroStrategy, Guggenheim, SkyBridge Capital, Square and PayPal into the space. Additionally, the Office of the Comptroller of the Currency has recently given U.S. banks the authorization to treat public blockchains as another form of settlement infrastructure and also allowed for banks to offer custody services of digital assets.

When it comes to altcoins, the world’s largest financial derivatives exchange, the Chicago Mercantile Exchange group, has finally announced its plans to launch a new ETH futures product in early 2021. As a result of this development, come February, traders will have the opportunity to speculate on Ether’s future monetary valuation using a fully regulated setup.

The offering, referred to as the CME CF Ether Reference Rate, will help expose crypto to a wide array of investors, traders and investors, allowing for better price discovery and, eventually, increased adoption within institutional circles.

Source: https://cointelegraph.com/news/the-rise-of-crypto-bitcoin-sets-landmarks-but-alts-can-go-independent

Blockchain

Ethereum EIP-1559 Targeting Gas Fee Challenges to be Implemented in July

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The contentious Ethereum Improvement Proposal (EIP) 1559, will be included in its codebase in July this year. This became clear during the All Core Developers call today.

EIP 1559: What Does it Mean for Fees?

Ethereum’s Improvement Proposal 1559 is aimed at improving the overall Ethereum’s user experience when it comes to transaction fees.

Typically, a user would have to send a gas fee to a miner for their transaction to be included in a block. What EIP-1559 proposes, however, is to send that gas fee to the network itself. Called basefee, this is a sort of a “burn” and there would only be an optional tip that’s paid to the miners. The burnt fee would be set algorithmically, supposedly improving the UX.

The proposal was originally submitted by Eric Conner and its summary provides an overall outlook at what it attempts to achieve:

A transaction pricing mechanism that includes fixed-per-block network fee that is burned and dynamically expands/contracts block sizes to deal with transient congestion.

During today’s All Core Developers call, it was decided that it will be included in the so-called London hard fork coming this July.

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Some Miners Disagree

Despite the potential improvements on the entire network that could come with EIP-1559, some of the largest Ethereum mining pools have openly displayed division on where they stand.

F2Pool, the third-largest ETH mining pool with over 10% hashrate share, shared a post, in which it supported the initiative, claiming that it would ultimately have a positive impact.

The publication says that “the general community along with core developers are siding with evolving Ethereum to include EIP-1559. It is important to side with the users and core contributors.”

F2Pool’s statement also argued that the potential EIP-1559 implementation could be factored in ETH’s price, which is more than 100% from the start of the year.

In contrast, though, the largest mining pool with nearly 25% share of the hashrate, Sparkpool, didn’t feel the same way about the integration as it could reduce the profits. They took it to Twitter to emphatically assert that the mining pool “opposes EIP-1559.”

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Source: https://cryptopotato.com/ethereum-eip-1559-targeting-gas-fee-challenges-to-be-implemented-in-july/

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Uniswap, Crypto.com Coin, Compound Price Analysis: 07 March

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Uniswap broke out past the $29.3 level of resistance, while Crypto.com Coin was in a phase of consolidation. Compound bounced off the $450 level of support to touch $500 but could see a pullback to $470.

Uniswap [UNI]

Uniswap, Crypto.com Coin, Compound Price Analysis: 07 March

Source: UNI/USDT on TradingView

UNI broke out and went past the $29 area of resistance, where the 23.6% retracement level and the $27.3 level of resistance lay. The upward move had extraordinary volume as UNI touched $31.54 but some selling pressure was seen in the subsequent trading session.

The Doji candle represented short-term exhaustion from the bulls, and the breakout could see UNI pullback to test the $29.3 level to confirm its flip from resistance to support.

The MACD showed strong bullish momentum behind UNI. Bearish divergence on the hourly chart between momentum (MACD) and the price could be seen in the coming hours, which would likely see UNI pullback to $29.4. This can be used to enter long positions, with a stop-loss just at $28.7.

Crypto.com Coin [CRO]

Uniswap, Crypto.com Coin, Compound Price Analysis: 07 March

Source: CRO/USDT on TradingView

The Bollinger bands showed that CRO was in a phase of consolidation at and around its 38.2% retracement level at $0.152. The RSI moved back above neutral 50 to indicate that momentum was swaying towards the bulls’ side.

The defense of the 50% retracement level at $0.127 and the immediate bounce-off was a show of strength from bulls – the $0.146-$0.152 region can be used to accumulate CRO in expectation of another move upwards. The $0.173 and $0.189 levels are levels of resistance to watch.

Compound [COMP]

Uniswap, Crypto.com Coin, Compound Price Analysis: 07 March

Source: COMP/USDT on TradingView

Compound saw a strong bounce-off at the $450 mark which represents a 23.6% retracement for COMP’s move from $205 to $573. At the time of writing, COMP faced some resistance at the $500 area.

Moreover, the Awesome Oscillator on the hourly chart displayed a bearish twin peak set up and gave a sell signal. This development, followed by the AO registering bearish bars on its histogram, is likely to see the price dip to $470. Bulls would need to show some strength at $470, or bears can drive the prices lower to $450 once more.


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Source: https://ambcrypto.com/uniswap-crypto-com-coin-compound-price-analysis-07-march

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Pakistan: Arrests made in Bitcoin extortion case

Republished by Plato

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The world of finance has never been able to protect itself from the fraudulent activities going around in the world. The cryptocurrency market, which itself is a growing space has also had its fair share of such fraudulent activity being associated with it. However, unlike traditional finance, regulators have been enforced stringent measures when it comes to tackling such offenses.

A recent case has been reported in Pakistan, where the police have arrested several people part of the country’s first extortion case via crypto. According to reports, the police arrested the owner of an outhouse where the complainants, two foreign nationals, were held hostage along with two other suspects.

One of the suspects was identified as Rana Irfan Mahmood and a case has been registered against him and an unidentified accomplice. The hostages were Swiss national Maria Spari and German citizen Stephen [last name remains unknown] who were kidnapped by three men in police uniform along with another person.

After threatening the hostages with a fake drug smuggling case, the victims paid 6,300 euros in cash and made an online transfer of 1.8 Bitcoin which was close to $9k. The suspects made a fake video demanding an additional Rs 300 million [$1.91 million].

According to SSP Investigation Abdul Ghaffar Qaisrani, the police have managed to recover the amount paid to the facilitator apart from the Bitcoin. The crypto has already been transferred to another account and the team was taking assistance from the intelligence agencies to recover it.

Although the regulators in Pakistan have been taking note of Bitcoin and crypto, illicit activities have been a growing concern in the region. In November 2020, the Central bank clarified that it was not banning crypto, contrary to the prevailing fear within many in the crypto-community.

In fact, Pakistan’s Securities and Exchange Commission [SEC] published a paper on the regulation of cryptocurrency trading platforms. This paper outlined the regulatory approach to crypto and included recommendations given by the Financial Action Task Force [FATF], as well as regulations presented by Malaysia, Hong Kong, and the U.S.

However, the police in the country have warned users and the government about the rising cases of ransom and extortion related to crypto. Bitcoin has been at the center of these cases and such fraud activities will only instill fear with the lack of regulation among crypto users in the region.


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Source: https://ambcrypto.com/pakistan-arrests-made-in-bitcoin-extortion-case

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