Crypto Guides, Knowledge & Insights

Corporate Bitcoin Holdings Are Thriving At An Alarming Rate

MicroStrategy and Tesla may have hit headlines more than any other firm in the recent past as far as Bitcoin and crypto news is concerned. But they are only a very small percentage of the many corporations and hedge funds already invested or planning to invest in Bitcoin, going by the recent surveys.　　Recent surveys by Nickel Digital Asset Management and Intertrust Group reveal that close to 40 publicly listed hedge funds and corporations have now invested billions of dollars worth of Bitcoin investments.　　About $43.2 billion worth of Bitcoin is currently held by exchange-traded products (ETPs) and closed-end trusts according to the survey by Nickel Digital Asset Management. The survey showed that more and more of these organizations continue to allocate more portions of their cash holdings to crypto investments.　　The survey shows that about 19 publicly-listed companies around the world have Bitcoin allocations totaling about $6.5 billion. 13 of these come from Canada and U.S. while the rest are located in Europe, Hong Kong, and other countries of the world. Nickel also said that an additional 17 companies have added exposure to the Bitcoin asset. It, however, did not disclose these companies.　　Earlier surveys also show that hedge funds will increasingly invest

2021-06-23Deep Dive

Breaking down the 2 sides of the Ethereum price argument

The crypto market has continued bleeding, Ethereum‘s price has dropped to the $2000 level based on data from coinmarketcap.com. Ethereum’s price has dropped over 20% in the past week and this may be a result of the increased selling pressure. The trade volume was up over 50% in the past 24 hours and this was indicative of the selling pressure. The price is currently over 50% away from the ATH of $4363, a month ago and despite that, it is likely to recover since the demand has increased despite the drop in price.　　ETH price chart | Source: CoinGecko　　The two sides of the ETH argument:　　1. ETH is undervalued below $3000 and the bullish break is close since accumulation has increased below $2200, and　　2. Based on analysts on crypto Twitter ADA and ETH are overpriced, while ETH is close to the $2000 level.　　If we follow ETHs price, based on the chart and the resistance, since the resistance is at the $2200 level currently, there is a possibility of a 15% drop in price. Buying at this level is likely to lead to a loss in the short term if the selling pressure continues to rise. However, once the price is up, and

2021-06-23Deep Dive

Bitcoin’s worst-case and best-case scenarios for 2021

Theres no denying it — the cryptocurrency market is suffering. The current market downtrend has some people convinced that Bitcoin has peaked and that the sane course of action is to just cut losses and sell. Despite all the “bubble about to burst” expressions, the fact is that this has happened in the past.　　With regard to corrections, a few events led to Bitcoin‘s downfall. Ranging from Elon Musk’s Bitcoin energy FUD, China‘s mining crackdown, and more recently the death cross looming over Bitcoin’s price movements. Considering the above reasons, can Bitcoin still rise？ What are the worst-case and best-case scenarios regarding the same？　　Here‘s this crypto analyst’s take on Bitcoins price movements. PlanB took to his Twitter to address the current scenario around the largest crypto token. His arguments incorporated the current bearish sentiment as well.　　Worst case　　At the time of writing, Bitcoin was indeed bleeding. It was trading just above the $33k mark with a pullback of about 8% in 24 hours. Can it go lower than this？ According to PlanB, heres how the price projection looks like from June till the end of this year. He stated:　　“Bitcoin is below $34K, triggered by Elon Musk‘s energy FUD and China’s mining crack

2021-06-23Deep Dive

5 Reasons Why Tezos May Be Technologically More Advanced Than Bitcoin and Ethereum

It is evident there are some crucial differences between the top cryptocurrencies and their underpinning technology. Whereas Bitcoin and Ethereum share similarities, Tezos is often a very different creature. Numerous reasons exist to give this ecosystem a second glance, as things are shaping up nicely.　　Tezos Foregoes Proof-of-Work　　Given the recent concerns celebrities and scholars have had regarding Bitcoins energy consumption, it is only normal to see alternative consensus algorithms gain more momentum. Proof-of-Staker remains a viable option, assuming it is implemented correctly. Tezos leverages proof-of-stake to bring its estimated annual TwH consumption down to 0.00006. Whether that number is realistic remains unclear, but it is evident PoS is more viable from an “energy-efficient” viewpoint.　　Smart Contracts Are The Way　　In this blockchain industry, not supporting smart contracts can be a death sentence for particular ecosystems. Bitcoin does not have [much] smart contract functionality by default, although the Rootstock sidechain can provide valuable tools. Tezos has native smart contract support, making them more accessible than through a sidechain or extra network layer. This puts it in the same category as Etheruem, and soon, Cardano.　　Shielded Transactions Matter　　Neither Bitcoin or Ethereum provides any degree of privacy to the user. Pseudonymity is far from the same, although

2021-06-23Deep Dive

Why Michael Saylor And MicroStrategy Are The Biggest Risk To Bitcoin

Bitcoin price is in a precarious position, on the ropes after a nasty selloff and on the cusp of losing support. All while this happens, MicroStrategy CEO Michael Saylor continues to buy BTC, adding to the corporations already sizable position.　　While there are plenty of market participants that cheer the corporate crypto bull on each time it happens, the more the company holds the most systemic risk it brings to the first ever cryptocurrency and its underlying network. Heres why.　　Dear Michael Saylor: Stop Buying Bitcoin For The Sake Of The Network　　Popular opinion is everything these days. If you arent woke, well, you might as well not exist anymore. The hive mind tends to think all alike, and going against the crowd leads to being an outcast.　　At the expense of going against popular opinion and the risk that comes with it, there‘s a need to call attention to the risk that’s being created in the top cryptocurrency by market cap, thanks to one specific actor: Michael Saylor.　　The entire point of Bitcoin was so that no third-party or one actor could influence the network of money itself. Even Satoshi Nakamoto disappeared from existence for this very reason.　　The emergence of figureheads in crypto is

2021-06-23Deep Dive

New BOA Report Says Digital Currencies 'Could Boost Economic Growth' in Developing Countries

A new Bank of America (BOA) research study has found that both central bank digital currencies (CBDCs) and private digital currencies hold “a lot of potential” for increasing financial inclusion in developing countries. In the report, the bank also argues that such “digital currencies could reduce transaction costs and allow more economic activities in emerging market economies.”　　Digital Currencies and Financial Inclusion　　Still, the study findings show that while digital currencies are likely to “boost economic growth” in developing countries, their adoption will carry some risk. In addition, the study also finds that the rise of digital currencies “could lead to inflation and dollarization.”　　Meanwhile, a separate report quotes David Hauner, the BOAs head of emerging market cross-asset strategy and economics for EMEA, explaining why digital currencies could be pivotal in emerging market countries where more than 50% of adults lack a bank account.　　“Digital currencies have the potential to address many practical constraints on financial services in poor countries,” said Hauner.　　The report also lists the reduction of cross-border payment costs as well as the reduction of corruption and other illegal activities as some of the constraints that can be addressed by digital currencies.　　Risks to Physical Currency　　The BOA research study found that the rise

2021-06-23Deep Dive

Goldman Begins Trading on JPMorgan’s Repo Blockchain Network

Goldman Sachs Group Inc. has joined the blockchain-based network created by JPMorgan Chase & Co. for repurchase agreements that use smart contracts and a digitized version of the U.S. dollar.　　Its first trade came on June 17, when it swapped a tokenized version of a U.S. Treasury bond for JPMCoin, JPMorgan‘s internal representation of a digital dollar, according to Mathew McDermott, global head of digital assets for Goldman’s global markets division. He declined to give the value of the trade.　　“We see this as a pivotal moment for the digitization of transactional activity,” McDermott said Tuesday in an interview. Unlike in the traditional repo market, the exact amount of time the banks took to complete the transaction was quantifiable. In this case, it was 3 hours and 5 minutes.　　Knowing the precise time is a big step up from the current market, as is the way the collateral and cash are interchanged simultaneously and immediately, McDermott said.　　“We pay interest per the minute,” he said. “We firmly think this will change the nature of the intraday marketplace.”　　JPMorgan created the new repo market using its version of the Ethereum blockchain, with its first trades in December. It has since gone on to trade more than

2021-06-23Deep Dive

Story from Markets MicroStrategy’s Most Recent Bond Drops Below Par as Bitcoin Sells Off

MicroStrategy‘s latest bond to finance the company’s additional purchase of bitcoin is now trading below its face value as the price of the cryptocurrency continues to decline.　　Prices on the $500 million bond, which closed on June 15, dropped almost three points after the company said on Monday that it completed its purchase of 13,005 bitcoin at an average price of $37,617. Bitcoin was trading at around $32,780 as of press time.　　On Tuesday, the price on the bond was trading at 97.75 cents on the dollar, down from 100.62 on Friday, according to Trace, a bond pricing service.　　Yields were at 6.53% on Tuesday, 40.5 basis points higher than its coupon rate of 6.125%. Bond prices and yields move in opposite directions.　　The bond, which is due 2028, is guaranteed by the new bitcoin MicroStrategy bought and any other digital assets the company acquires in the future.　　Meanwhile, another of the Virginia-based software companys debt instruments, a $1.05 billion convertible bond, was trading at at 68.76, down from 74.23 on Friday.　　If bitcoins price remains at its current level of $32,668, the company will need to write down roughly $64 million for its recent bitcoin purchase.　　At last count, MicroStrategy held 105,085 bitcoin. The company has

2021-06-23Deep Dive

Is There A Silver Lining to China’s Ban on Crypto?

IN BRIEF　　Chinese crypto ban in the past has been followed by a market rebound as seen in 2017.　　In 2017 China banned all crypto exchanges in August, but the market bounced to new ATHs in November.　　China banned bitcoin and crypto again this year with several weeks of state-driven crackdown on trading and mining operations in the country. However, this is not the first time when the worlds most populated state has done so, earlier in 2013 and 2017 also China imposed a similar ban on cryptocurrencies.　　The recent sell-off is being attributed to the Chinese crackdown but there is a silver lining to it. Based on the historical data Bitcoin and altcoins have bounced back to new highs post-Chinese ban. Bobby Lee, the founder, and CEO of Ballet Bitcoin wallet highlighted that the Chinese bitcoin and crypto ban has often led to a market bottom following which the price has jumped to new highs.　　Lee explained that in 2017 China banned all exchanges in August right before the National Day celebrations on October 1 and the crypto market rebounded in November. Similarly, the 2021 crypto crackdown comes ahead of Communist Partys 100th founding anniversary scheduler for July 1.　　Has Crypto Market Hit Bottom？　　Lee explained

2021-06-23Deep Dive

How Archer Swap Has Helped End Ethereum’s Bidding War

Most DeFi users have heard of Ethereums high congestion issues, but few are aware of the controlling forces operating behind the scenes, and how badly they can be impacted by this single problem. When traders send a regular transaction via the Ethereum network, it is susceptible to attacks from bots or front-running software run by entities seeking to profit from trader activity.　　Ethereums ecosystem is perhaps amongst the fastest growing in the crypto space. Thus, there are already many solutions that tackle this issue and operate for the benefit of the users and decentralized exchange (DEX) traders. Most of them have gone under the radar.　　Archer Swap is part of the Archer DAO, a project with features designed to mitigate the risks associated with sending transactions on Ethereum. It protects users from Miner Extractable Value (MEV) strategies, sandwich attacks, and front-running bots while maintaining a connection with Uniswap and SushiSwap, two of the most popular DEXs on Ethereum.　　In this sense, Archer Swap can be described as a DEX extension that enhances the trader experience on these dApps. This protocol combines two powerful sets of features that give traders improved operations on Ethereum – protecting them and making trades more cost-efficient.　　The first set

2021-06-23Deep Dive

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