NFTs, DeFi Boost for Ethereum Dims Clamor of Bitcoin Maximalists

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Bloomberg 01 September, 2021 - 11:43am 8 views

What is Solana Crypto?

Solana is a programmable blockchain, similar to Ethereum, that can run multiple decentralized finance operations. ... As a programmable system, the decentralized blockchain platform permits users not just to exchange SOL coin, but also non-fungible tokens and other digital assets. Yahoo FinanceEthereum Competitor Solana Achieves $38 Billion in Market Valuation — What Does This Mean for Bitcoin?

Coinbase’s Bitcoin reserves drop to the lowest level since December 2017

InvestorPlace 01 September, 2021 - 02:13am

BTC price action stays frustratingly dull as altcoins take the chance to put in a serious performance, led by Ether.

Data from Cointelegraph Markets Pro and TradingView showed BTC/USD hitting lows of $46,530 on Bitstamp overnight, its lowest since Friday.

With $50,000 out of reach, price action continued to diverge “remarkably” from strong on-chain metrics and fundamentals.

For analyst Willy Woo, who echoed similar findings from this week, a large pool of support at current levels is likely to hold Bitcoin where it is. Over 1.65 million BTC has a cost basis between $45,000 and $50,000.

“Bitcoin approaching another region of notable price stability,” he told Twitter followers Wednesday.

The area around $51,000, which this week remains active as a “final hurdle” resistance level for Bitcoin, is widely tipped to crumble in the mid-term, but the exact timing of such an impulse move is a mystery.

Investors seemed ready to go on the day, with reserves on major exchange Coinbase at their lowest levels since December 2017 — 700,000 BTC — and almost $20 billion in stablecoins sitting across centralized trading platforms ready for conversion.

“After a period of moderate BTC inflows following the May Sell-off, Coinbase has seen a large outflow of coins,” on-chain analytics firm Glassnode commented on the data. 

For Cointelegraph contributor Michaël van de Poppe, however, it was business as usual for a BTC consolidation.

“Yep, Bitcoin is following this path,” he summarized.

ETH/USD passed $3,500 overnight, marking its highest in three months against the United States dollar and BTC. Its cryptocurrency market capitalization dominance rose to 20.4%, with Bitcoin’s steady at 44%.

3 reasons why a Bitcoin ETF approval will be a game changer for BTC price

Cointelegraph 31 August, 2021 - 01:20pm

A Bitcoin ETF approval will open the door for more conservative investors, and this could have an irreversible impact on the price of BTC.

Public pension funds, retirement plans, fixed income and most non-leverage equity and multimarket mutual funds can only invest in certain asset classes. These limits arise from the fund class regulation, the fund's own bylaws and the administrator's risk assessment.

Unbeknownst to most, the mutual fund manager does not have absolute control of the investment decision. The fund administrator is a third-party company that acts as an intermediary between the fund manager and investors to verify and distribute assets tied to investments.

Therefore, the fund administrator might rule that a particular instrument poses a significant risk and either limit the exposure or deny access to it. The trust fund, in this example, is the investment vehicle used by the Grayscale Bitcoin Trust, or GBTC, and involves an issuer credit risk.

Global asset managers will typically have a 30% to 60% fixed income exposure, so it is very unlikely to have any exposure to cryptocurrencies. Amundi, the leading European investment firm — with over $2.1 trillion of assets under management — is a good example.

According to BCG Group, the global asset industry has surpassed $100 trillion, with North America holding nearly 50% of this figure. Unfortunately, these astronomical figures cause analysts to incorrectly relate those numbers to the Bitcoin exchange-traded fund (ETF) instrument.

According to Reuters, more than half of all investment-grade corporate bonds in the eurozone now trade with negative yields. This includes $7.7 trillion worth of government debt, which accounts for 70.8% of the total.

Financial Times reported that the value of the global negative-yield debt has surpassed $16.5 trillion, fueled by investors' more pessimistic outlook and bond purchases by central banks.

There's reason to believe that investors getting negative yields will eventually move to riskier assets, although it is improbable that a total shift to cryptocurrencies will occur. However, the most likely beneficiaries are non-leverage multi-assets and alternative investments, as these instruments usually carry lower risk than equities and high-yield structured assets and bonds.

Consequently, an eventual Bitcoin ETF approval by the United States Securities and Exchange Commission will open the doors for a vast array of funds that are currently shut out from cryptocurrency exposure.

Even if the ETF is exclusively reserved for a part of the equities and multi-asset classes, the new instrument doesn't even need to capture $500 billion to propel Bitcoin's market capitalization above $2 trillion. Less than 2.5 million coins are deposited on exchanges, equivalent to $125 billion readily available for trading.

According to iShares, the value of global commodities exchange-traded products adds up to $263 billion. Considering that not every mutual fund is listed, it is reasonable to assume that the actual number surpasses $500 billion.

This means that a mere 1% allocation from this specific asset class is equal to $5 billion, and such an investment would surely be enough to propel Bitcoin's price above its $65,000 all-time high.

If and when a BTC ETF is approved, traders will front-run the potential inflow as soon as the approval is announced, regardless of whether the products capture only $5 billion in the first couple of months.

As long as governments and central banks continue injecting liquidity, buying bonds and issuing stimulus packages, there will be a gradual inflow to riskier assets, increasing the demand for the ETF.

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