Crypto Guides, Knowledge & Insights

Multiple Tokens See Rally Amid Looming ‘Alt Season’

As prices for bitcoin and ether retreat from their recent highs, the strong performance of other cryptocurrencies indicate traders and investors may now be turning to alternative coins (altcoins) for potential high returns.　　Data compiled by CoinDesk Research shows that as of Jan. 11, prices for both bitcoin (BTC, -4.6%) and ether (ETH, -4.53%) were about 87% and 78%, respectively, of their all-time highs. Yet, other CoinDesk 20 assets were still far from their highest prices on record. One possible implication is that these tokens may still have potentials to reach higher price levels amid the latest bitcoins bull run.　　Source: Nomics　　“We have seen [altcoins] pump – both before and after [Mondays] correction – in ways that we have not really seen since 2017,” Andrew Tu, an executive at quant firm Efficient Frontier, said.　　Bitcoins market capitalization hit a new record high on Jan. 8 but has dropped since then, evidence that some traders may be taking some profits from bitcoin and plowing them into altcoins, according to Tu.　　The total market capitalization of bitcoin.　　Source: CryptoQuant　　As CoinDesk reported previously, following the institution-driven 2020 bitcoin bull run, retail investors and traders have joined the rally for “fear of missing out.” Some entry-level investors viewing the

2021-01-13Deep Dive

Velas (VLX) Expands on Solana (SOL) Blockchain, Introduces Ethereum (ETH) Compatibility

Velas (VLX), a high-performance blockchain ecosystem, has shared details of its partnership with Solana (SOL), a pioneering sharded decentralized network well known for its 65,000 txs per second throughput.　　Velas (VLX) starts using Solana (SOL) codebase　　According to a recent press release shared with U.Today by Velas, its team inked a partnership with Solana (SOL) blockchain. Velas starts using Solanas codebase to build a new high-performance blockchain ecosystem.　　The Velas team highlights that the new collaboration will result in building a blockchain framework with previously unseen technical metrics:　　Velas will expand upon the Solana codebase in order to obtain and leverage one of the fastest blockchain frameworks in the entire crypto industry, far exceeding previous framework speeds and those of competitors.　　As covered by U.Today previously, Velas (VLX) recently launched iteration 3.0 of its ecosystem. It includes BitOrbit, a decentralized social media platform and Velas Wallet, a multi-currency crypto storage instrument.　　In addition, Velas (VLX) platform moves to an AIDPOS, a novel consensus solution. AIDPOS will leverage machine learning mechanisms to adjust blockchain operations to changing conditions.　　Velas (VLX) becomes EVM-compatible, migrates to open-source development　　Then, Velas shared its plans to switch to an open-source approach to the development of its own codebase.　　Another siginificant milestone for Velas (VLX)

2021-01-12Deep Dive

XRP Faces Prompt Recovery Despite Legal Uncertainty

While the crypto community remains uncertain about Ripple‘s future following the SEC’s recent lawsuit against Ripple, several on-chain metrics estimate that XRP is bound for a bullish impulse.　　XRP Tumbles Following SECs Charges　　XRP has seen its price crash over 65% in the past two months.　　That sell-off came after the U.S. Securities and Exchange Commission (SEC) filed an action against Ripple. The regulatory watchdog claims that the company raised over $1.3 billion through an unregistered and ongoing digital asset securities offering.　　“We allege that Ripple, Larsen, and Garlinghouse failed to register their ongoing offer and sale of billions of XRP to retail investors,” said Stephanie Avakian, Director of the SECs Enforcement Division. That deprived investors of XRP disclosures and other protections, she says.　　Following the announcement, several cryptocurrency exchanges decided to suspend XRP trading activity due to the SEC‘s charges. The move added fuel to the downward pressure that began on Nov. 24, pushing this cryptocurrency’s price to a low of $0.17.　　XRP/USD on TradingView　　Despite the uncertainty around XRP, it was able to rebound and test the $0.33 barrier. Now, several on-chain metrics suggest that as long as the $0.22 support continues to hold, prices might recover some of the lost ground and break through

2021-01-12Deep Dive

First Signs of Bitcoin Panic Shows as Whales Profit from Correction

Bitcoins incredible rally to where it breached $20,000 and then more than doubled its worth from December 16, 2020, has brought in a lot of new blood and investment. However, many of these new investors would never have experienced the sting of Bitcoin volatility.　　Now, the first pinch of a bitcoin correction has come and the price of the coin fell from a high of $41,000 to a low of $31,000, shedding almost 25 percent of its value. This major loss has not been felt since March of 2020, and thus will be entirely new to some investors.　　In fact, it appears as if those not strong enough to face Bitcoins volatility may have already been pulling out. However, those with more experience are now in a position to profit and accumulate more coins.　　Statistics governing wallet balances from Glassnode reveal that the main investors “buying the dip” are those with a balance in excess of 1,000 BTC ($36 million).　　BTC millionaires know a good thing　　The drop in price will have been damaging to many who hopped on the bandwagon late — but for those who are in the business of accumulation, this correction will serve as a time to again buy cheaper-than-market-value coins.　　Elias

2021-01-12Deep Dive

JP Morgan Warns of Falling BTC Price With Bitcoin ETF Approval in US

JP Morgan published a report on Friday that discusses the impact of an SEC-approved bitcoin ETF on the bitcoin market. “Optimism around the prospect of the SEC approving a bitcoin ETF in the US this year has risen in anticipation of SEC leadership changes,” the analysts wrote, stating:　　“The approval of a bitcoin ETF in the US this year would likely be negative for bitcoin in the near term.”　　The analysts, including strategist Nikolaos Panigirtzoglou, proceeded to explain why they are forecasting a negative outlook. “The reason is a potential decline in the Grayscale Bitcoin Trust (GBTC) premium to NAV [net asset value] from the introduction of bitcoin ETF in the US, which would unwind a big portion of GBTC investments currently placed for monetizing this premium.”　　They elaborated that “Some institutional investors likely subscribed to GBTC (at NAV) during the second half of last year with the intention of selling after the 6m unlock period … As the 6m unlocked period expires, some of these institutional investors might sell GBTC during the first half of 2021 to monetize the premium. If it materializes, this selling pressure would put downward pressure on GBTC premiums.”　　Emphasizing that a bitcoin ETF would provide an alternative investment

2021-01-12Deep Dive

MicroStrategy stock finally takes a breather following massive BTC-inspired rally

Shares of MicroStrategy (MSTR), a business intelligence firm with considerable exposure to Bitcoin (BTC), declined sharply on Monday as profit-taking ensued following a parabolic rally over the past month.　　The stock touched an intraday low of $464.51 in New York trading, representing a decline of almost 13%. It would later pare losses to trade around $500 pe share. At current values, the company has a total market capitalization of around $4.6 billion. Last week, the stock peaked just below $512, marking a new all-time high.　　MSRT went parabolic after CEO Michael Saylor decided to buy Bitcoin. Source: Yahoo Finance　　The broader equity market was also under pressure on Monday, with the S&P 500 Index and tech-heavy Nasdaq each falling more than half a percent.　　MSRT‘s pullback coincided with a sharp decline in both the price of Bitcoin and the broader crypto markets as investors took profits following a relentless surge over the past three weeks. Even with the decline, MSRT’s share price has gained a whopping 300% since last summer when CEO Michael Saylor first disclosed the companys Bitcoin position.　　MicroStrategy is the worlds largest corporate holder of Bitcoin, with 70,470 BTC on its books as of Monday, according to industry data.　　The firm has been

2021-01-12Deep Dive

Pirated Academic Database Sci-Hub Is Now on the ‘Uncensorable Web’

The pirated database of academic papers is now accessible directly through the services portals as well as through NextDNS, a privacy-focused, cloud-based domain name service resolver which converts IP addresses into domain names.　　“The DNS is like a phonebook for the internet. The addresses in the phonebook are the server IP addresses. DNS was created to give IP addresses human-readable names so with our platform, youre finding the IP address through Handshake, not through a certificate authority,” Namebase CEO Tieshun Roquerre told CoinDesk.　　For a website that has had various domain names revoked over the years and which is now suspended from Twitter, the censorship-resistant DNS will help keep Sci-Hub accessible even as the legacy domain name system applies pressure.　　Sci-Hub is a worldwide database of academic publications, which pulls the research papers from under the paywalls of academic magazines and uploads them to the internet for everyone to download and read. Its maintained by a single coder from Kazakhstan, Alexandra Elbakyan, who is raising donations via Russian payment network Yandex and bitcoin， CoinDesk wrote last year.　　How does Handshake work？　　Handshake is “is effectively a decentralized domain name server,” Roquerre said. Instead of using the web-standard certificate authority to authenticate user connections to a

2021-01-12Deep Dive

Babel Finance Is Letting Crypto Mining Firms Use Machines as Loan Collateral

Babel Finance is letting bitcoin mining firms put up their machines as loan collateral so the lender can offer them better terms.　　The loan-to-value ratio (LTV) for these loans is 30%, in part because Babel keeps the freshly mined crypto until the borrower pays back the loan. The LTV is significantly cheaper than the 160% Babel normally charges, which means borrowers would need to put up $1.6 million worth of bitcoin in order to borrow $1 million in U.S. dollars. 　　In a bull market miners are increasingly uneasy parting ways with mined cryptocurrency. These loans allow the miners to cover expenses like paying electricity bills or purchasing new equipment while giving up less BTC or ETH.　　“For miners, the biggest asset they have is their machines,” said Lei Tong, Babels managing director of financial services. “After the March 12 price drop, they really wanted to keep as many coins as possible. Putting their machines up as a mortgage is a much better way for them to get loans versus using bitcoin.” 　　The service launched in June 2020 and has since accumulated $22 million worth of machine-backed loans. 　　To offer the service, Babel has teamed with the worlds largest ETH mining pool, Spark

2021-01-12Deep Dive

Institutions Use This Strategy to Hide Their Bitcoin Orders

Institutional investors and speculators trading large quantities of bitcoin are taking on a new method to hide the real sizes of their trades. They are doing so – many times with the quiet help of many major exchanges – to cut the risk of exposing their intent to the market, be they bullish or bearish, which can cause unfavorable price moves.　　　　Avi Felman, head of trading at BlockTower, took note of one such trade in the last week of December when someone, or possibly an institution, bought a substantial amount of bitcoin (BTC, +1.14%) on U.S.-based crypto exchange Coinbase. However, the order book only showed a constant bid (buy order) for 20-40 bitcoin. Essentially a large quantity was purchased via multiple small orders.　　“Somone [sic] (@elonmusk？) has been sitting 20-40 bitcoin on the Coinbase bid and reloading since $26,800,” Felman tweeted on Dec. 31.　　Avi Felman　　This has broader implications for what happens in the market. Thats because if an institution were to post a large-sized order, it would telegraph its position to the rest of the market, causing prices to move against it. Having smaller orders, in essence, fools the market into thinking there is not much interest at lower price levels when

2021-01-12Deep Dive

Bitcoin’s Active Addresses, Trading Volumes Now at All-Time Highs

Trading volumes and active addresses for bitcoin have now surpassed their previous all-time highs during the last crypto bull run in 2017, and the data has given some analysts confidence the bull market for bitcoin is not over yet.　　Source: CryptoCompare　　Data from CryptoCompare shows that bitcoin trading volumes on the eight major exchanges tracked on the CoinDesk 20 have passed $11 billion, a new all-time high from the previous record during 2017s crypto bull market.　　“This is first and foremost a sign of how much bigger and mature the industry is, with a lot more money flowing on these exchanges,” Bendik Norheim Schei, head of research at Arcane Research, told CoinDesk. “It is great to see higher volumes, making the market more liquid and efficient.”　　The surging volume due to Mondays sell-off came in part from newcomers to the market, according to Schei.　　“Some of this volume is definitely from new and unexperienced investors entering the market for the first time and panicking when the price starts falling,” he said. “These corrections are necessary and healthy, even in a bull market.”　　At the same time, the number of active bitcoin addresses has also broke its previous record on Jan. 8, according to data from Glassnode.　　The

2021-01-12Deep Dive

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