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Are We Out Of The Woods? Analyst Bullish On Bitcoin’s 6-Figure Future
Bitcoin (BTC) began the month with the deepest retrace of the cycle, falling to the ,000 support level. The retrace raised alarms for some crypto investors and market watchers, who feared the bull run had ended.
Since then, the largest cryptocurrency by market capitalization has recovered crucial levels, and analysts have identified bullish patterns on BTC’s chart, suggesting that it might finally be out of the woods.
Is Bitcoin Out Of Danger?
As the May 1st retrace developed, crypto analyst Rekt Capital highlighted the similarities between Bitcoin’s 2016 and 2024 post-halving performances. He suggested that the flagship cryptocurrency’s price development came “as no surprise,” as it was mirroring the “post-Halving Bitcoin Danger Zone” of 2016.
Per the analyst, the “Danger Zone” is officially over, which BTC is “celebrating with a good bounce from the Re-Accumulation Range Low support.” He stated that May could be an “unremarkable” month for the largest cryptocurrency, potentially continuing next month. However, Bitcoin is “running out of unremarkable months” before the beginning of this cycle’s “Parabolic Phase.”
Additionally, Rekt Capital considers that BTC’s sell-side momentum is starting to show signs of slowing down, “slowly developing a curl against the ,000 support.” Per the post, Bitcoin must continue to hold this support zone for the curl to “progress and eventually lift up.”
Similarly, analyst Bluntz identified a bullish engulfing pattern on Thursday, considering there would be “a solid engulfing on the daily close.” To the analyst, it appeared that the “next push-up into ATH has started.”
This morning, Bluntz confirmed the pattern formation and announced to his followers that this cycle’s Round 2 began, which would lead to a “fresh ATH.”
BTC’s Strength Could Lead The Price To 6-Figures
Following the bullish analysis, CryptoJelle stated that BTC “is looking good.” Per his post, the cryptocurrency “has nearly completed a full reset,” as it’s back to the 100-day Exponential Moving Average (EMA).
Additionally, the chart displays a “bullish MACD cross” below the zero line and the “first higher low in a long time,” suggesting a positive divergence.
Jelle highlights that BTC’s price is again pushing into the trendline that “has pushed prices lower over the past weeks.” Despite the higher low, he points out the necessity of reclaiming the ,000 support zone before new highs come.
For these new highs, he set an ,000 target for BTC’s price, suggesting that a 6-figure price for the flagship cryptocurrency is possible during this cycle.
#Bitcoin is pushing into the trendline that has pushed prices lower over the past weeks — once again.
Looks like a higher low has been put in, but we still need to break ,000 convincingly.
Chop city until that happens.
Stick to the plan. pic.twitter.com/ClTuv8QmhO
— Jelle (@CryptoJelleNL) May 13, 2024
The analyst emphasizes Bitcoin’s performance this cycle, stating that the community has under-appreciated its strength during this bull run. He considers that the run is not over, as the “Halving” event occurred just a few weeks ago, and BTC’s price has been consolidating around the previous cycle’s all-time high for a long period.
On Monday, Bitcoin surged to ,000 after hovering between ,000 and ,000 for the past few days. Despite its recent performance showing short-term red numbers, BTC’s price still registered a 25.7% and 76.5% increase in the three-month and six-month periods, respectively.
At the time of writing, BTC is trading at ,752, a 3% increase in the past 24 hours.
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Bitcoin News
Ethereum Burn Rate Hits Yearly Low: What This Means For ETH’s Future
In recent weeks, Ethereum has displayed subtle signs of recovery amidst a generally bearish crypto market, with the altcoin mimicking Bitcoin’s modest uptrend.
Despite Ethereum’s price increasing slightly by 0.2% over the last 24 hours, a parallel trend that might significantly affect Ethereum’s economic model has been unfolding beneath the surface.
Decline In Network Activity Reduces ETH Burn
April witnessed Ethereum’s ETH burn rate hitting an annual low, primarily due to a significant decrease in network transaction fees.
These fees have typically fluctuated just below 10 gwei this year, but recent weeks have seen them dip to some of the lowest levels, directly influencing the rate at which ETH is burned.
This reduced burn rate is evidenced by the stark drop in daily burned ETH, which reached a low of 671 ETH in the past day a notable decrease from the daily figures of 2,500–3,000 ETH seen earlier in the year.
Such a decline in burn rate is not merely a statistical anomaly but a reflection of broader shifts within the Ethereum network.
A significant factor contributing to the lowered gas fees is the increased migration of network activities to Layer 2 solutions, which enhance transaction speeds while lowering costs.
Moreover, innovations like blob transactions, introduced in Ethereum’s recent Dencun upgrade, have further optimized costs on these secondary layers.
Notably, Blobs are a feature introduced to enhance Ethereum’s compatibility with Layer 2 solutions like zkSync, Optimism, and Arbitrum by efficiently managing data storage needs. This functionality is part of the Dencun upgrade, which integrates proto-danksharding via EIP-4844.
While beneficial in reducing transaction fees, these technological strides pose challenges to Ethereum’s deflationary mechanisms.
This upgrade introduced a new fee structure in which a part of every transaction fee, the base fee, is burned, potentially reducing the overall ETH supply. However, with decreased transaction fees, the anticipated deflationary pressure via burning has softened, signaling a shift to a more inflationary trend in the short term.
According to Ultrasoundmoney, Ethereum’s supply dynamics have swung to a mildly inflationary mode with a growth rate of 0.498%. This shift could realign if network activity intensifies, leading to increased transaction fees and, consequently, higher burn rates.
Ethereum Market Response
Despite these underlying network dynamics, Ethereum’s market price has struggled to regain its former highs above ,500. The asset trades around ,085, reflecting a slight downturn over recent weeks.
This price behavior underscores the broader market’s reaction to internal network changes and external economic factors, such as regulatory struggles from the US Securities and Exchange Commission (SEC) and macroeconomic uncertainties.
Looking ahead, the trajectory of Ethereum’s gas fees and subsequent ETH burn rate will be crucial in determining the sustainability of its economic model.
Featured image from Unsplash, Chart from TradingView
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Bitcoin News
Bitcoin Miners Remain Optimistic About Future Despite Anticipated Revenue Loss
Although Bitcoin’s halving is expected to result in reduced block rewards for miners, several CEOs of bitcoin mining firms maintain a bullish outlook. In addition to investing in more efficient equipment, miners believe spot bitcoin exchange-traded funds (ETFs) will continue to drive up the value of the cryptocurrency. Bitcoin Halving to Cost Miners Billions in […]
Bitcoin News
Are The Odds In Bitcoin Bulls Favor? These Analysts Forecast BTC’s Future
As the Bitcoin (BTC) “Halving” approaches, expectations increase about how the flagship cryptocurrency will perform. Bitcoin (BTC) is recovering momentum after facing a significant correction in the first few days of Q2, and some analysts are forecasting new heights for the number one cryptocurrency soon.
Are The Odds In The Bulls Or Bears Favor?
Bitcoin had its best quarterly close during Q1, 2024. Despite BTC’s stellar performance, as Q2 started, the market was dragged by the leading cryptocurrency’s price correction.
Since then, Bitcoin has been steadily recovering, testing the ,000 resistance level over the weekend. As the week started, BTC appeared to have regained support above the ,000 level.
Crypto analyst Ali Martinez seems to think that Bitcoin’s performance so far reflects a positive sentiment from investors. In an X post, Martinez shared a chart that paints an optimistic picture, at least for now.
When you compare support (1.4 million addresses holding 893,000 $BTC between ,220 and ,325) with resistance (474,000 addresses holding 285,000 #BTC between ,760 and ,200), the odds appear to favor the #Bitcoin bulls! pic.twitter.com/pceCyGa8mb
— Ali (@ali_charts) April 9, 2024
According to Martinez’s post, the In/Out of the Money Around Price (IOMAP) indicator seems favorable to the bulls. Per the chart, the addresses holding BTC at the support level massively outnumber those holding Bitcoin at the resistance level.
The chart suggests that Bitcoin is at “stable support” as 474,000 addresses hold 285,000 BTC between ,760 and ,200. Meanwhile, 1.4 million addresses hold the flagship cryptocurrency between ,220 and ,325.
When compared, the addresses and BTC held at the support level nearly triple those in the resistance zone. To the analyst, bulls are the current victors as “odds appear to favor” them.
Analyst Forecast Bitcoin To 90,000 Soon
Captain Faibik, another crypto analyst, also seems to perceive more bullish momentum for Bitcoin. In an X post, the analyst suggests that BTC’s “bullish pennant upside break is confirmed on the daily chart.”
Per the chart, the flagship cryptocurrency’s price started a consolidation period in early March, forming a pennant pattern. This pattern saw an upside breakout after Monday’s daily candle closed above the ,000 price range.
Due to this breakout, the analyst forecasts a surge to the ,000-,000 price range this month.
$BTC Bullish Pennant Upside Breakout is Confirmed on the Daily timeframe Chart..
Now, Send Bitcoin to the 88-90k this Month. #Crypto #BTC #Bitcoin pic.twitter.com/ok2DGPXsAb
— Captain Faibik (@CryptoFaibik) April 9, 2024
At the time of writing, Bitcoin remains above the ,000 support level, only 5% below its most recent all-time high (ATH) price of ,373. Despite the positive resistance, BTC’s price performance shows a slight decrease of 2.3% from yesterday.
Similarly, its daily trading volume and market capitalization have mildly dropped. According to CoinMarketCap data, BTC’s daily trading volume is down by 6%, while its market cap of .38 trillion represents a 2.1% decrease.
Nonetheless, Bitcoin remains 8.4% above its price seven days ago, trading at ,378. Further bullish sentiment, fueled by the upcoming “Halving” event, could help the largest cryptocurrency by market capitalization consolidate its support above the current levels.
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Bitcoin News
Grayscale Drops Bombshell Report: Crypto Bull Run Progresses To ‘Middle’ Phase, Future Outlook Detailed
The cryptocurrency market has witnessed a significant surge after a prolonged bear market and the intensified crypto winter caused by the collapse of crypto exchanges and firms during 2022 and part of 2023.
Notably, Bitcoin and other major cryptocurrencies have experienced substantial price surges, accompanied by renewed interest from institutional investors entering the market through recently approved spot Bitcoin exchange-traded funds (ETFs).
Adding to the industry’s positive outlook, asset manager and Bitcoin ETF issuer, Grayscale, believes that the current state of the market indicates that the industry is in the “middle” stages of a crypto bull run.
Grayscale recently released a comprehensive report detailing their key findings and insights into what lies ahead. A closer analysis of the report by market expert Miles Deutscher sheds light on the factors contributing to this assessment.
On-Chain Metrics And Institutional Demand
Grayscale’s report starts by highlighting several key signals indicating that the market is currently in the middle of a bull run. These include Bitcoin’s price surpassing its all-time high before the Halving event, the total crypto market cap reaching its previous peak, and the growing attention from traditional finance (TradFi) towards meme coins.
To understand how long this rally might sustain, Grayscale emphasizes two specific price drivers: spot Bitcoin ETF inflows and strong on-chain fundamentals.
Grayscale notes that nearly billion has flowed into Bitcoin ETFs in just three months, indicating significant “pent-up” retail demand. Moreover, ETF inflows have consistently exceeded BTC issuance, creating upward price pressure due to the demand-supply imbalance.
Grayscale’s research focuses on three critical on-chain metrics: stablecoin inflows, decentralized finance (DeFi) total value locked (TVL), and BTC outflows from exchanges.
According to Deutscher, the increase in stablecoin supply on centralized exchanges (CEXs) and decentralized exchanges (DEXs) by approximately 6% between February and March suggests enhanced liquidity, making more capital readily available for trading.
Furthermore, for the analyst, the doubling of the total value locked into DeFi since 2023 represents growing user engagement, increased liquidity, and improved user experience within the DeFi ecosystem.
The outflows from exchanges, which currently account for about 12% of BTC’s circulating supply (the lowest in five years), indicate rising investor confidence in BTC’s value and a preference for holding rather than selling.
Based on these catalysts, Grayscale asserts that the market is in the “mid-phase” of the bull run, likening it to the “5th inning” in baseball.
Promising Outlook For Crypto Industry
Several key metrics support Grayscale’s analysis, including the Net Unrealized Profit/Loss (NUPL) ratio, which indicates that investors who bought BTC at lower prices continue to hold despite rising prices.
According to Deutscher, the Market Value Realized Value (MVRV) Z-Score, currently at 3, implies that there is still room for growth in this cycle. Additionally, the ColinTalksCrypto Bitcoin Bull Run Index (CBBI), which integrates multiple ratios, currently stands at 79/100, suggesting that the market is approaching historical cycle peaks with some upward momentum remaining.
Furthermore, retail interest has yet to fully return this cycle, as evidenced by lower cryptocurrency YouTube subscription rates and reduced Google Trends interest for “crypto” compared to the previous cycle.
Ultimately, Grayscale retains a “cautiously optimistic” stance regarding the future of this bull cycle, given the promising signals and analysis outlined in their report.
Featured image from Shutterstock, chart from TradingView.com