The Base blockchain is buzzing with interest in meme coins again. Brett (BRETT) has been making headlines after its price shot up for two days straight. While investors digest this surprise rally, a new project, Base Dawgz (DAWGZ), is drawing attention for its potential to replicate BRETT’s success. BRETT Price Soars as Open Interest Trends […]
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Is Ethereum Overvalued, Similar ‘To Meme Coins Like Shiba Inu’?
A crypto investor, Fred Krueger, thinks Ethereum is overvalued at spot rates. Referring to X, Krueger added that Ethereum supporters are “detached from reality” after ETH, the native currency, recently broke above ,000.
The investor pointed to the general declining on-chain activity, fierce competition from alternatives like Solana and Avalanche, for instance, and regulatory uncertainty that makes holding the coin risky.
Ethereum Is Slow And Usage Is Shrinking
Krueger argues that Ethereum’s on-chain transactions could be faster and cheaper. In the current landscape marked with scalable and low-fee alternatives, either built on Ethereum or existing as independent chains, the chain’s challenges no longer justify ETH trading at spot rates of about ,000.
Beyond scaling and throughput challenges, the investor also refers to the sharp decline in daily active users (DAUs) on the mainnet. Since 2021, Ethereum and altcoin prices have peaked, and active DAUs have fallen from around 120,000 to approximately 66,000 in February 2024.
Though network supporters said there had been developments like layer-2 platforms like Arbitrum pinning their security on Ethereum, Krueger notes that even the most active and largest protocols by total value locked (TVL) have seen user losses.
To illustrate, Uniswap V3, the third version of one of Ethereum’s largest decentralized exchanges, Uniswap, now records around 16,000 daily active users, significantly lower than previous years.
Alternatives Like Solana Offer Better: Is ETH Expensive?
The investor argues that the decline in DAUs, pointing to active usage, sharply contrasts with Ethereum’s rising market capitalization and spot rates. In Krueger’s opinion, this emerging state of affairs is why Ethereum has become a bloated “meme coin like Shiba Inu,” looking at its high market cap.
It in the investor’s assessment that faster and cheaper alternatives like Solana, Avalanche, and Near Protocol offer better value for specific use cases like decentralized finance (DeFi) and games.
Krueger also took issue with the lack of regulatory clarity on Ethereum. The United States Securities and Exchange Commission (SEC) recently approved the first spot Bitcoin exchange-traded funds (ETF) batch. Primarily, this is because SEC officials recognize Bitcoin as a commodity.
Gary Gensler and the SEC have failed to classify ETH in the same category as BTC. Accordingly, though the broader crypto community is optimistic about the eventual authorization of a spot Ethereum ETF, Krueger thinks it is unlikely.
Still, time will only tell how Ethereum and its market valuation will evolve in the coming months. Supporters are optimistic, despite criticism, that rising adoption and ETH’s deflationary nature will lift prices towards 2021 highs of ,000.
Robert Kiyosaki Predicts ‘End of the American Empire’ Similar to Roman Collapse
Rich Dad Poor Dad author Robert Kiyosaki has cautioned about the impending downfall of the American empire, drawing parallels to the decline of the Roman Empire. “The Roman Empire ended in the same way with massive gladiators entertaining chubby Romans while their bankers debased their currency to pay soldiers and bills,” he said, adding that […]
Bitcoin News
Blockchain Basics Act Reaches Tennessee, 16 Legislatures Working on Similar Bills
The Blockchain Basics Act, a bill that seeks to secure the rights of state citizens regarding cryptocurrency ownership, self-custody, and mining, has reached Tennessee. The bill, supported by the Satoshi Action Fund, was introduced to the State House by Rep. Kevin Vaughan and simultaneously to the State Senate by Sen. Bo Watson.
Blockchain Basics Act Introduced in Tennessee
The Blockchain Basics Act, a bill that aims to enshrine cryptocurrency rights such as self-custody, ownership, and mining, has reached Tennessee. The bill was recently introduced both to the Tennessee State House (HB2309) and to the State Senate (SB2370) by Rep. Kevin Vaughan, chairman of commerce, and Sen. Bo Watson, who also serves as chairman of finance, chair of rules, and vice-chair of pensions.
As in other states, the bill seeks to prevent the state government from approving rules affecting cryptocurrency mining operations specifically and guarantee that citizens of the state might use cryptocurrency without restrictions, including running their own nodes. Similarly, it eliminates state capital gains tax for transactions under 0.
Dennis Porter, CEO and co-founder of the Satoshi Action Fund, a nonprofit that educates lawmakers about introducing crypto-specific regulations, explained that while the institution had already helped pass two bills to protect bitcoin adoption, this might be an uphill battle in some states.
He also reported that there was additional work on different legislatures to keep expanding the reach of the Blockchain Basics Act at a state level. Porter declared:
We are now actively working in 16 different legislatures in 2024 to pass similar legislation, so this goes far beyond just one state. You and I cannot take our foot off the gas.
The Satoshi Action Fund’s work has been essential in introducing similar regulations in five states across the U.S.: Virginia, Missouri, Indiana, Nebraska, and Tennessee. Porter believes that bitcoin adoption won’t happen from the top down in the U.S., trying instead to mimic what happened with cannabis, which was treated more favorably at the state level than by the federal government.
What do you think about the introduction of the Blockchain Basics Act in the state of Tennessee? Tell us in the comments section below.
US Sanctions on Russia Similar to Planting a ‘Bomb Under the Dollar,’ Says Russian Analyst
The United States’ sanctions against Russia are undermining confidence in the U.S. dollar and may force other countries to ditch the currency, a Russian financial analyst has said. The analyst said contrary to the West expectations, the sanctions against Russia have failed to destroy its economy.
Russia’s Frozen Assets
According to Alexander Razuvaev, a Russian economist and financial analyst, the United States sanctions policy against Russia will undermine the dollar’s position as the world reserve currency. Razuvaev cited the U.S. plans to transfer Russia’s frozen assets to Ukraine as an example of Washington’s actions that may result in more countries dumping the greenback.
In his remarks published by a local publication, the financial analyst also referred to the U.S. Federal Reserve interest rate hikes as another act that is undermining the dollar’s reserve currency status. To counter these acts, Razuvaev suggested that Russia should double down on its ongoing effort to wean itself from the dollar-dominated financial system.
Sanctions Have Failed to Destroy the Russian Economy
Razuvaev predicted that countries like Turkey and Azerbaijan are likely to follow in China’s footsteps and may even settle trades using the digital ruble. According to the analyst, China has been dumping American bonds and paying for Saudi Arabian oil with its currency.
After Russia invaded Ukraine in February 2022, Western countries led by the U.S. responded by imposing economic sanctions on Moscow. In addition, billions of dollars of Russian money held in foreign banks were frozen in what was seen as the West’s attempt to weaken Russia. However, despite the sanctions and asset freeze, Russia has continued its war against Kyiv, raising questions about the effectiveness of the punishment meted out so far.
Meanwhile, Razuvaev is also quoted in the same report explaining his thoughts on the impact of the sanctions and how they have failed to destroy the Russian economy.
“America’s actions undermine the authority of the dollar; they inflicted the strongest blow on their own. We will see this in gold prices if they rise sharply. The United States, I think, was counting on the destruction of the Russian economy within three to four months, and then wanted to return the assets,” Razuvaev said.
He also intimated that the United States’ stance against Russia is akin to planting a bomb under the dollar.
What are your thoughts on this story? Let us know what you think in the comments section below.
Unlimited Innovations vs. 2,500 Swimming Pools — AI Faces Similar Environmental Backlash as Bitcoin Mining
In recent years, attention has centered on bitcoin mining, particularly its energy usage in securing the network and validating transactions through proof-of-work (PoW). As generative artificial intelligence (AI) emerges as a major force in technology, it’s encountering similar environmental concerns. Moreover, advocates of bitcoin are drawing parallels between the criticisms of AI’s energy demands and those directed at cryptocurrency mining.
Eco-Impact of AI: Facing the Environmental Challenges of Innovation
Although AI has generally received acclaim in the press, its consumption of electricity and water has recently sparked considerable debate. Numerous online articles decry the significant resources AI utilizes, including a Rolling Stone piece alleging that “Microsoft’s global water consumption spiked in a year to nearly 1.7 billion gallons.” The article oversimplifies the intricate issue by comparing AI’s water usage to that of 2,500 Olympic-sized swimming pools.
The digital outlet The Standard employs a similar argument by equating water consumption to the volume of swimming pools. This approach echoes the one used by critics of bitcoin mining, who liken its energy use to a nation’s consumption levels. On the social media platform X, Bitcoin advocate Nic Carter observed in response to The Standard’s headline that they are “literally just copy [&] pasting their anti-bitcoin mining takes into anti-AI articles.”
Equating AI’s consumption to the total usage of a particular human resource is arguably misleading due to various factors, often overlooked in these exaggerated AI narratives, including context, nature, and utility differences. A nuanced, informed discussion should reflect on the quality, type, and repercussions of energy use in each scenario.
The energy source powering AI is significant. If generative AI is fueled by renewable or excess energy that might otherwise remain unused, this is distinct from using non-renewable resources critical for essential human activities, rendering direct comparisons futile. Moreover, as technology progresses, AI infrastructure is becoming more energy-efficient, potentially diminishing its relative energy impact. These same points have been made and can be applied to the resource utilization involved in crypto mining.
Developer and Casa CTO, Jameson Lopp, commented on on an X post that discusses training an AI model or a large language model (LLM). The post claims with a cited article from earth.org that “training an AI model is nearly 7x worse for the environment than U.S. car manufacturing and fuel consumption.” Lopp said it was the “dumbest decel outrage yet.” “I guess the morons don’t realize that a trained LLM can be queried an unlimited number of times by an unlimited number of people,” Lopp added.
Furthermore, in the same X post thread another commenter explained that when considering total emissions rather than emissions per unit, it becomes apparent that the overall impact of AI models on emissions is relatively small compared to the vast number of people, cars, and plane travel. This observation points to a smaller environmental footprint for AI models due to their lesser quantity.
“Even if we assume 10,000 models get trained every year, which is definitely an overestimation, the total emissions from that still pale in comparison,” the individual wrote.
The fervent discourse surrounding the environmental impact of bitcoin mining and generative AI reflects a broader societal concern. However, the rush to sensational headlines often obscures the complex, multifaceted nature of these technologies. Beyond clickbait narratives, there lies a deeper need for comprehensive understanding and nuanced debate about the true implications of our advancing digital era, one that considers all perspectives and seeks to inform rather than inflame public opinion.
What do you think about the recent debates concerning AI and its energy and water consumption? Share your thoughts and opinions about this subject in the comments section below.
The Jackson Hole Effect? Powell’s Speech Sparks Bitcoin Fears Amid Similar 2022 Price Action
As Jerome Powell, the Federal Reserve (Fed) Chair, prepares to return to Jackson Hole this Friday, the Bitcoin (BTC) market is experiencing a sense of anticipation due to the similarities in the current price action compared to the period leading up to last year’s speech.
Key moving averages have been tested and lost over the past two weeks, followed by a period of consolidation, reminiscent of previous events.
However, it is important to note that these similarities do not guarantee a repeat of the past, as market conditions and Powell’s stance have since evolved.
Déjà Vu In The Bitcoin Market?
According to Keith Alan, co-founder of analysis and crypto research firm Material Indicator, last year, in the two weeks preceding Powell’s speech, BTC’s price broke through crucial technical support levels represented by the 21-day, 50-day, 100-day, and 200-week Moving Averages (MA).
Subsequently, a period of consolidation ensued, followed by a significant price drop in response to Powell’s hawkish tone during the speech. Alan stated:
Remember when Fed Chair Powell spoke from Jackson Hole last year and his hawkish tone triggered a 29% BTC dump that took 5 months to recover?
Notably, the recent price action in the Bitcoin market has displayed similarities to last year’s pattern. Over the past two weeks, Bitcoin has tested and lost these same key moving averages, and it is currently undergoing a phase of consolidation, mirroring the events leading up to Powell’s previous address.
Keith Alan emphasizes that since last year’s Jackson Hole event, there have been notable changes. Core inflation has decreased, and Powell’s approach to communication has become more “measured”.
It is uncertain whether Powell will adopt a hawkish or dovish stance in his upcoming speech, making it challenging to predict the market’s reaction with certainty. What is evident, however, is that the market is primed for a significant move.
Additionally, Alan suggests that the formation of a lower low in price increases the likelihood of an extension of the existing downtrend. Market participants should be prepared for the possibility of further testing of support levels.
As the Bitcoin market awaits Powell’s speech, market sentiment remains dynamic. Traders and investors are anticipating potential market-moving cues from the event.
As the date of Jerome Powell’s return to Jackson Hole approaches, Bitcoin has displayed a notable recovery of 2.1% within the past 24 hours, marking a positive upward movement that brings it closer to the ,000 threshold.
However, it is crucial to note that if the outcome of Jerome Powell’s speech on Friday proves favorable for crypto investors and propels Bitcoin’s price to higher levels, the cryptocurrency may encounter a significant obstacle in the form of its 200-day moving average positioned at ,200.
Featured image from iStock, chart from TradingView.com
Arkansas Makes Gold, Silver Legal Tender; 23 States Involved in Similar Legislation to Establish US Dollar Alternatives
A bill signed into law on April 11 has made gold and silver legal tender in the U.S. state of Arkansas, allowing citizens to use gold and silver coins to pay debts. The bill also clarifies that gold and silver “specie” (coins) will not be considered property for tax purposes, and transactions made with these precious metals will not result in tax duties.
Arkansas Embraces Gold and Silver as Legal Tender
The state of Arkansas has moved to make gold and silver function as legal tender in its territories. The “Arkansas Legal Tender Act,” signed by Arkansas Governor Sarah Huckabee Sanders on April 11, explicitly mentions that gold and silver “specie” (meaning any kind of bullion or coin containing these materials) can be used to pay for debts.
The act also specifies that “specie or legal tender shall not be characterized as personal property for taxation or regulatory purposes,” and that “the purchase, sale, or exchange of any type or form of specie shall not give rise to any tax liability.”
The law, which will enter into validity 90 days after its approval in the April 7 legislative session, makes Arkansas the fourth state to designate previously approved gold and silver coins as legal tender, behind Wyoming, Oklahoma, and Utah.
More States Moving to Approve U.S. Dollar Alternatives
23 states are currently developing regulations that will also allow their citizens to use gold and silver as legal tender, according to the Tenth Amendment Center, a federalism advocacy organization. Michael Marrahey, communications director for the Tenth Amendment Center, believes this is an initiative to undermine the powers of the U.S. Federal Reserve, noting that states are “nullifying the Fed on a state-by-state level.”
The theory behind this idea is that in a multicurrency environment, the better currency will be the one that prevails. In this sense, constitutional tender expert professor William Greene explains:
Over time, as residents of the state use both Federal Reserve notes and silver and gold coins, the fact that the coins hold their value more than Federal Reserve notes do will lead to a “reverse Gresham’s Law” effect, where good money (gold and silver coins) will drive out bad money (Federal Reserve notes).
The debate of making gold and silver legal tender comes from way back, with experts stating this possibility is enshrined in the U.S. Constitution, which states that “no state shall … make anything but gold and silver coin a tender in payment of debts.” Market analysts like Peter Schiff have predicted that a bull market for gold is coming, saying “it will be spectacular.”
What do you think about Arkansas making gold and silver legal tender? Tell us in the comments section below.
Hong Kong Judge Rules Crypto Assets as ‘Property,’ Following Similar Rulings Worldwide
In a court case linked to the now-defunct crypto exchange Gatecoin, a Hong Kong judge has ruled that cryptocurrencies are “property” which is “capable of being held on trust.” According to the law firm Hogan Lovells, this case should provide greater clarity to insolvency practitioners and other common law jurisdictions.
Hong Kong Judge Designates Crypto Assets as ‘Property’ That Can Be ‘Held on Trust’
According to a summary of the ruling published on April 18, 2023, judge Linda Chan in Hong Kong has classified crypto assets as “property.” The decision was made in connection with the Gatecoin crypto exchange liquidation court case from 2019. Law firm Hogan Lovells opines that this decision provides clarity to officials, regulators, and other common law jurisdictions. In the United States, there is currently a debate in Congress about whether certain crypto assets should be classified as securities or commodities.
At the beginning of the Gatecoin liquidation process, liquidators had difficulty determining whether crypto assets constituted a form of property. According to the Hogan Lovells summary, judge Chan has defined crypto assets as a type of property that can be “held on trust.” Hogan Lovells notes that this ruling “should provide greater clarity to Hong Kong insolvency practitioners regarding the nature and scope of a company’s digital assets in a winding-up scenario.” The law firm adds:
The confirmation that holdings of cryptocurrencies constitute ‘property’ that is on a par with other intangible assets such as stocks and shares, brings Hong Kong into line with other common law jurisdictions whose courts have already decided the issue.
Judges in various court cases around the world have issued similar rulings. For example, last year, an intermediate court in Beijing, China ruled that virtual property is protected by Chinese law. Additionally, China’s Supreme Court has recommended increasing the legal protection of property rights that include crypto assets and virtual property. Research indicates that most countries consider virtual currencies as property, while others and regulatory agencies have yet to make a decision.
What are your thoughts on the classification of crypto assets as “property” by Judge Chan in Hong Kong, and how do you think this ruling will impact the treatment of crypto assets in insolvency cases and other common law jurisdictions around the world? Share your thoughts about this subject in the comments section below.
Repeat Of April 2019? Bitcoin Rally Shows Similar Break Above These Key Levels
On-chain data shows Bitcoin has broken above these three key levels in a manner reminiscent of the rally in April 2019.
Bitcoin Breakout Shows Initial Similarities To April 2019 Rally
According to data from the on-chain analytics firm Glassnode, BTC has broken above the three investor cost-basis levels for the first time since the COVID-19 crash and the 2018-2019 bear market. The relevant indicator here is the “realized price,” to understand the concept of the “realized cap” it needs to be looked at first.
The realized cap is a capitalization model for Bitcoin that assumes that each coin in the circulating supply has its real value as the price at which it was last moved rather than the current BTC price (which the normal market cap uses for its calculation).
Now, from the realized cap, a “realized price” can be obtained by dividing the metric by the total number of coins in circulation. Since the realized cap accounted for the prices at which investors bought their coins (which is to say, their cost basis), the realized price can be thought of as the average acquisition price in the market.
This means that if the normal price of Bitcoin dips below this indicator, the average holder can be assumed to have entered a state of loss. While this realized price is the average cost basis for the entire market, the metric can also be defined for only specific groups of investors.
The BTC market can be divided into two primary cohorts: short-term holders (STHs) and long-term holders (LTHs). Investors who bought their coins within the last 155 days fall into the STHs, while those holding them since before that threshold are included in the LTHs.
Here is a chart that shows the trend in the Bitcoin realized price for the entire market, as well as for these two holder groups separately, over the last few years:
As the above graph shows, Bitcoin had broken above the STH cost basis and the entire market’s realized price earlier in the latest rally, suggesting that the average STH and the overall average investor was back in profit.
In the most recent continuation to the rally, the crypto has now surged above the LTH cost basis of ,400. This means that the average investor in every segment is now in the green.
The last time Bitcoin displayed a breakout above all these levels was following the black swan COVID-19 crash, which had briefly taken the coin below these prices.
A similar trend also formed in April 2019, when the bear market of that cycle ended, and a bullish transition took place. Though it’s early to tell right now, this similarity between the two rallies could hint about the path that the current one might also end up following.
BTC Price
At the time of writing, Bitcoin is trading around ,900, up 8% in the last week.