Crypto Guides, Knowledge & Insights

BYBIT ANALYSTS INDICATES ALT-SEASON MAYBE UPON US DESPITE FEARS OF RAMPANT VOLATILITY

Following the tumultuous last couple of days that saw Bitcoin plunge to lows of $28,950, the market as a whole has proceeded to make a swift recovery, with a vast majority of the top-10 cryptos once again sitting in the green. And while that may be a regular day in the office for most crypto investors, an increasing number of analysts have been issuing warnings for individuals to brace for impact as the coming few weeks and months could see an increased amount of volatility.　　Despite all of the sell-offs and volatility that was witnessed over the last week, data available online clearly shows that the number of addresses with 1,000 or more bitcoin (referred to as “whales” in the crypto world) has continued to increase. This “buy-the-dip” strategy is not uncommon and has traditionally been used by investors across markets. However, this time around, with the introduction of institutional players into the digital asset sector, such consolidation-centric activities have increased substantially, resulting in continuous fluctuations in the price of most cryptos.　　IT‘S BITCOIN’S REIGN BUT IS THERE A NEW SHERIFF IN TOWN？　　There is no denying that Bitcoin is the clear OG of the crypto world, as is probably best highlighted by

2021-01-26Deep Dive

Whales Own 40% Of All Bitcoin – Are They Manipulating The Market?

Nearly half of the Bitcoin market is controlled by only 2500 accounts. Were there any collaboration between some of these ‘whales’, then given the relatively thin volume on trading Bitcoin, these whales would be able to have a huge amount of sway over the rise and fall in the Bitcoin price.　　Bitcoin is still a very young asset, only having come into existence 12 years ago in 2009. Earlier this month the number one Cryptocurrency posted a new all-time-high of around $42,000 per Bitcoin, helping the combined Cryptocurrency market cap to surpass 1 trillion dollars.　　It is said that single trades by one of the big whales can lead to a swing in the market, either up or down.　　A collaborative report between OKEX and data firm Kaiko looked at how retail investors, professional investors and whales were buying and selling. In the last week of November, the report concluded that as retail investors continued adding to their positions, whales were selling, leading to those small-time investors being trapped in their positions in the short to mid-term as the price fell.　　In all likelihood, many of the retail investors would have then sold, leaving the whales to hoover up this Bitcoin as the price

2021-01-26Deep Dive

BTC whales and miners sold into institutional buyers in Q4 2020

In May 2020, famous macro investor Paul Tudor Jones revealed that he was buying BTC as a hedge against central bank-induced fiat inflation. He also said the foremost cryptocurrency reminded him of gold in the 1970s.　　Joness comments, at the time, sparked a wave of speculation from industry analysts that institutional investors would start flocking to the BTC market. OKEx Insights found this to be the case in September 2020, where we used on-chain data from Catallact to discover that institutions really did follow Joness lead. Since then, the industry has learned that business intelligence firm MicroStrategy purchased large sums of BTC alongside institutional buys from the Massachusetts Mutual Life Insurance Company.　　Kicking off 2021 with an apparent surge in institutional interest, OKEx Insights has once again used on-chain data from Catallact to delve deeper into the narrative that institutions are buying BTC. More specifically, however, we wanted to find out who had been selling into the latest bull run in 2020.　　Heres what we found out.　　A note on how we interpret on-chain data　　Before we begin, lets first clarify how we interpret on-chain data.　　This report is research-based, but on-chain data cannot tell us everything. As such, analysts must always exercise caution when drawing

2021-01-26Deep Dive

Nasdaq-Listed Company Buys $150 million worth of Bitcoin as a part of its Treasury Reserves

Bitcoin is well on the road to becoming a scarce asset as more institutions buy huge amounts of the number one cryptocurrency. The latest to get its hand on more than 4500 Bitcoins is Nevada-based Nasdaq-listed Marathon Patent Group Inc.　　According to a recent announcement from the firm, it has recently purchased 4,813 bitcoin for about $150 million as a part of the companys treasury funds. This event marked the first time that the Bitcoin mining firm has purchased Bitcoin from the market.　　“By leveraging our cash on hand to invest in bitcoin now, we have transformed our potential to be a pure-play investment into a reality. We also believe that holding part of our treasury reserves in bitcoin will be a better long-term strategy than holding U.S. dollars, similar to other forward-thinking companies like MicroStrategy,” said company CEO Merrick Okamoto.　　The prices of Marathon‘s stock went up 892% last year, while its competitor MicroStrategy saw its stock gain 166%, as compared to bitcoin’s gain of about 300% during the year.　　Just a few weeks back, Marathon had raised $250 million in an equity round. However, Okamoto noted that these funds remained untouched because the firm already had $425 million in cash before the

2021-01-26Deep Dive

Analyst Gives Three Reasons Why $1.6 Billion in ETH Just Left Exchanges

Some hefty whales have been detected in the waters of the Ethereum blockchain.　　The Ethereum balance on top-tier crypto exchanges reached a 15-month low of 15.4 million ETH ($20.5 billion) according to a tweet from crypto analytics team Glassnode on Saturday 23.　　The exodus started on Tuesday, when there was 16.6 million ETH held in exchanges, meaning that $1.6 billion has left exchanges. The Whale Alert Twitter account, a bot that tracks large crypto transactions, reported that much of it shifted from major crypto exchanges to anonymous wallets.　　But wheres it gone and what caused the exodus？　　What caused the ETH exodus？ An analyst explains　　Pedro Febrero, an analyst at Quantum Economics, told Decrypt that there could be three reasons that explain why so much ETH was drained from exchanges.　　First, “Ethereum has returned to being locked in DeFi,” said Febrero, in reference to crypto staked in decentralized finance smart contracts. DeFi refers to the budding industry of decentralized lending protocols, exchanges and synthetic derivative protocols.　　However, this one doesnt check out. According to DeFi Pulse, a site that tracks the amount of crypto locked in smart contracts, The amount of ETH locked in DeFi actually decreased from 7 million ETH on Tuesday to 6.9 million the

2021-01-25Deep Dive

Crypto Lawyer Stephen Palley Backs SEC, Says XRP Is A Security

A top lawyer and crypto enthusiast Stephen Palley has backed the SEC, saying that XRP is indeed a security. The company behind XRP, Ripple has been in court since late December last year following a suit by the SEC alleging that XRP was an unregistered security.　　Prior to this, the XRP community had accused the Ripple management of periodically dumping the cryptocurrency on the market due to its highly centralized system. Ripple has denied this allegation severally before the SEC filed a suit against the company and its executives for selling and making a profit from XRP to the tune of $1.3 billion.　　Though Ripple is ready to fight the SEC as it believes that XRP is not a security, some important personalities in the crypto space have affirmed the position of the SEC, one of which is Stephen Palley. Last week, Bidens newly appointed head of the SEC, Gary Gensler said there may be more unregistered securities like XRP in the crypto space and there is a need to regulate them.　　Although the case on XRP has not yet been concluded, the position of top cryptocurrency influencers such as Palley may give an insight into its outcome. Already, many exchanges have delisted

2021-01-25Deep Dive

Dogecoin (DOGE) Approved by Flare Community as New Asset

Flare Networks, the development team behind the much-anticipated Flare blockchain, organized a poll on its official Twitter account. Now it is clear whether Flare supporters are welcoming the most unusual asset of all old-fashioned cryptocurrencies.　　DOGE implementation approved by the Flare community　　As U.Today reported previously, on Jan. 21, 2020, Flare Networks launched a community referendum with only one question. Namely, Flare supporters were asked to specify their position on the possibility of adding Dogecoin (DOGE) as an F-Asset on Flare.　　Today, when the discussion concluded, it became clear that the Flare community is generally optimistic about DOGEs prospects on the platform. A whopping 53.1 percent of respondents showed enthusiasm about DOGE as a third F-asset alongside XRP and Litecoin (LTC).　　Image via Twitter　　Mr. Hugo Philion, Flare Networks CEO, stressed that the “value” behind a cryptocurrency protocol is the core criteria for new assets implementation.　　The poll generated great interest among Flare Networks Twitter community. Out of 64,000 followers, 11,546 crypto enthusiasts decided to take part in it.　　What are F-Assets？　　According to the official explanation by Flare Networks, an F-Asset should be referred to 1:1 representation on Flare of any token from another chain. Due to the trustless design of Flare, the bridge between the two

2021-01-25Deep Dive

Key metrics show this week’s $4B Bitcoin options expiry favors bulls

Over the past two weeks, Bitcoin price appears to have lost momentum and some analysts are suggesting that bears will be in control for the foreseeable future.　　Taking a look at derivatives market data provides a clearer picture of what is happening on the institutional side and how the moves of larger players may impact the spot markets.　　After peaking at $10.6 billion on Jan. 14, the open interest on Bitcoin (BTC) scaled back to $8.4 billion. The Jan. 29 monthly expiry continues to stand apart, totaling 47% of the options in play.　　Although a $4 billion expiry could be significant, one must consider that these options are split among calls (neutral-to-bullish) and the more bearish put options. Furthermore, having an opportunity to buy BTC for $52,000 on Jan. 29 might have made sense a couple of weeks ago, but not so much right now.　　BTC options aggregate open interest. Source: Bybt.com　　As the data above depicts, Deribit exchange remains the absolute leader with an 83% market share. Nevertheless, to understand how eventful this expiry could be, one must adjust data and compare both calls and put options near the current $32,000 BTC level.　　Its too early to panic　　Most exchanges offer monthly expiries and some also

2021-01-25Deep Dive

BITCOIN ON-CHAIN DATA REVEALS CHINESE MINING POOL BEHIND ITS CRASH

An otherwise decentralized cryptocurrency, Bitcoin, might have become a victim of a centrally orchestrated price dumping attempt.　　According to data fetched by CryptoQuant, a South Korea-based blockchain analytics firm, Bitcoin miners at Chinese mining firm F2pool started the massive sell-off that crashed the BTC/USD exchange rate by almost 20 percent in just less than 24 hours.　　Bitcoin outflow from F2Pool to all exchanges. Source: CryptoQuant　　OVERSUPPLIED BITCOIN　　CryptoQuant CEO Ki-Young Ju listed a series of bearish alerts he received when Bitcoin started plunging on early Friday. As per the data he provided, the Miners‘ Position Index went above 2.5, reflecting growth in Bitcoin units that miners moved from their wallets. Meanwhile, the CryptoQuant’s All Exchange Bitcoin Transaction Count Inflow surged, showing F2pool as a major BTC depositor.　　“The dump might have started from BTC miners in F2Pool,” Mr. Ju added. “ 569 people deposited BTC in a single block (10 min). 78 miners deposited BTC in a single block (10 min).”　　Miners typically sell their BTC rewards to cover their operational costs (including electricity bills, equipment handling, and maintenance). Many of them prefer to hold a portion of their Bitcoin holdings for speculations, thereby effectively limiting the cryptocurrency‘s supply from entering the retail markers. That, in

2021-01-25Deep Dive

Ampleforth-like Bitcoin rebasing token DIGG drops: crypto stimulus checks

The latest crypto stimulus (or DeFi stimulus check, to be more accurate) has just dropped.　　Badger DAO, a Bitcoin-focused decentralized finance project based on Ethereum, just rolled out a new coin called DIGG. BADGER, the governance token for the protocol, already exists.　　DIGG is a new token that works much like Ampleforth, a supply-elastic cryptocurrency that changes its supply based on the price of the coin at each time. Instead of being pegged to a dollar, DIGG pegs to the price of one Bitcoin. Although this may sound like a small nuance, many in the DeFi space have said that this change may result in more reflexivity in the coins price action.　　That being said, DIGG was distributed to users of the Badger DAO protocol on a semi-quadratic basis on these three key factors:　　BADGER staked in the protocol.　　BADGER earned by the user. BADGER could and still can be earned by users by depositing liquidity into the protocol for farming purposes.　　How much BADGER has been earned by the user relative to the coins they have staked.　　Regarding the semi-quadratic basis, this was done to make the distribution of DIGG more fair:　　“Other details regarding the distribution were outlined in the BIP 14 forum post, including the

2021-01-25Deep Dive

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