Julian Assange’s Bitcoin wallet received $500,000 worth of Bitcoin from a mystery donor on Tuesday, on-chain data shows.
The donation follows the whistleblower’s release from the United Kingdom’s high-security Belmarsh prison on Monday, after reaching a plea deal with U.S. authorities following five years behind bars.
Bitcoin Brings Assange Home
According to blockchain data, a donation of 8.2 BTC ($492,254) was transferred from a multisignature wallet to Assange’s Bitcoin donation address, as displayed on the freeassange.org website.
Early on Wednesday, the WikiLeaks founder’s wife Stella Assange called on followers for a final show of financial support, seeking $520,000 to pay debt to the Australian government. Assange was barred from taking commercial flights for his route to Saipan for his court appearance, and later back home to Australia, and thus needed money to use charter Flight VJ199 for the journey.
Though the family successfully raised over 78% of their target funds through Crowdfunder as of Wednesday, the Bitcoin donation received Tuesday covered nearly the entire debt expense.
Assange walked out a free man after pleading guilty in court to one charge of espionage on Wednesday, and has since returned home to Australia. Judge Ramona Manglona noted that Assange’s actions caused “no actual physical harm” following his plea.
Who Sent The Bitcoin?
Two men appear to have subtly – though not directly – claimed credit for the donation. One was internet personality Andrew Tate, who replied with an emoji of a gift to someone calling attention to the transaction over Twitter.
The online Bitcoin community was more skeptical of Tate’s claim, calling on him to sign the transaction personally to prove his control of the senders’ address. However, observers later noticed a subtle claim from another wealthy personality with much deeper roots in the Bitcoin community.
“Safe passage through,” tweeted Twitter co-founder Jack Dorsey on Tuesday at 5:03 pm ET – the exact time that the transaction was sent through on chain.
Dorsey’s company Block spearheads numerous Bitcoin infrastructure initiatives. It includes a beginner-friendly multi-signature wallet vendor, a mining chip manufacturer, and a platform for buying Bitcoin – CashApp. He’s also repeatedly donated money to Bitcoin developers, and holds BTC on his firm’s balance sheet.
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Bitcoin’s price took a steep tumble early this week, driving over $300 million in crypto market liquidations in a single day. Why the sudden volatility?
Gayatri Choudhury, Quantitative Research Analyst at Bitwise, says there have been two key drivers of the selloff – and neither relates to the Bitcoin ETFs.
Miners Are Dumping
The analyst first noted on Tuesday that the activity of Bitcoin miners – a cohort “often overlooked” by market watchers. Since the fourth Bitcoin halving in April, the network’s miners have been consistently selling their BTC amid much lower revenues and historically high competition from global competitors.
“On June 9, >3000 BTC were transferred from mining pools to Binance, marking a two-month peak,” Choudhury said. Citing a CryptoQuant dashboard, the analyst noted that heavy selloffs of the sort tend to correlate with downward price action, such as in mid April directly after the halving, or in late May.
CryptoQuant published a report earlier this month addressing the aggressive minder selloff, crediting it largely to Marathon Digital (MARA) – the largest publicly traded mining firm. The company offloaded 1400 BTC at the time throughout June, representing 8% of its total BTC holdings.
Both Bitwise and CryptoQuant also noted that miners sold 1200 BTC via OTC desks on June 10 – their highest daily volume since March. As for regular exchanges, Choudry said over $4.5 billion in assets moved from miner balances to exchanges in June.
Regarding motivations for their sales, Choudry highlighted miners’ tight profit margins since the halving. “Average miner revenue per terahash of energy invested in securing the network has dropped by 56% since the halving,” she said.
Mt. Gox Fears
Adding to market concerns was an announcement on Monday from Mt. Gox confirming that it would finally repay customers their long-lost Bitcoin in July after ten years of dormancy. The exchange holds over 141,000 BTC worth more than $8.5 billion, scaring investors into expecting an abrupt wave of BTC sell pressure.
“The going may seem tough right now, but remember that just a year ago Bitcoin was trading at $30,000. A year before that? $10,000,” concluded Choudhury.
While the bearish effect of Mt. Gox sell pressure are yet to be seen, crypto investors are currently looking forward to the launch of Ethereum ETFs in the United States in the same month. Analysts at K33 Research believe the ETFs will haul $4 billion in their first five months on the market.
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Bitcoin (BTC) has continued its downtrend, reaching new local lows of under $59,000. During the mid-hours of the United States Monday trading session, BTC briefly fell below $60,000 to register a new local low of $58,500.
This slump has persisted as outflows from the U.S. spot Bitcoin exchange-traded fund (ETF) market have continued into the new week.
The latest weekly report from the crypto exchange Bitfinex revealed that U.S. spot Bitcoin ETFs lost over $100 million each trading day last week, amounting to $544.1 million in collective outflows. Analysts at the trading platform said the outflows are a combination of weak-handed ETF investors reacting to short-term negative news and basis/funding arbitrage unwinding due to negative funding rates.
Bitcoin Open Interest Declines
According to Bitfinex, one of the signs of the unwinding of basis/funding arbitrage is the steep decline in Bitcoin futures open interest on the Chicago Mercantile Exchange (CME) and other trading platforms.
The open interest on the CME fell by $220 million in the past week, with the overall aggregate open interest across other platforms slumping by more than $450 million within the same timeframe. The plunge has brought the total Bitcoin futures open interest down from the June 7 record high of $36.99 billion to $33.3 billion.
“This reduction in OI coincides with negative funding rates observed across several exchanges over the past week and corresponds with the ETF net outflows, suggesting a substantial unwinding of the funding arbitrage trades linked to ETF flows. Given this, it is important to acknowledge that not all ETF outflows should be interpreted as direct spot selling,” stated analysts.
Bitcoin Could be Nearing Its Bottom
Citing the last Bitfinex Alpha report, analysts predicted that BTC could be nearing its bottom, as heavy ETF outflows, like those being seen, often correlate with the formation of local bottoms.
When BTC dropped below $70,000 in early June, U.S. spot Bitcoin ETFs recorded seven consecutive days of net outflows, highlighting the effect of sharp price movements on ETF investors’ sentiment.
“This pattern is critical for investors to monitor as it often provides clues to potential reversals or stabilization points within the market,” analysts noted.
Meanwhile, Bitfinex analysts have warned that market sentiment remains bearish, as there is a weakness in the lower timeframe range (one-minute to 15-minute charts) across crypto assets.
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According to the latest insight from a CryptoQuant analyst, Bitcoin might be poised for a notable price correction. This possibility of a price correction is based on major Bitcoin metrics such as the Adjusted Spent Output Profit Ratio (ASOPR), signaling a notable implication for Bitcoin’s trajectory.
Understanding ASOPR’s Role In Predicting BTC Corrections
The ASOPR, a key indicator in the crypto market, measures the profit ratio of spent outputs by comparing the value at which coins were bought to the value at which they were sold.
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According to the CryptoQuant analyst, when this ratio exceeds 1, it suggests that coins are being sold at a profit, which often correlates with bullish market conditions.
However, a critical threshold observed in historical data is when ASOPR approaches 1.08. At this point, the market tends to shift, signaling a potential onset of a correction phase.
This pattern has been consistent over several market cycles, providing a valuable tool for investors to assess the market’s health. For instance, when ASOPR climbs steadily above 1 but nears the 1.08 mark, investors might consider this an opportune moment to evaluate their positions before potential downturns.
The CryptoQuant analyst particularly noted:
Considering past instances where similar patterns were observed, there is a possibility that the current situation might follow the same (down) trend.
Another critical component the analyst mentioned in his BTC market analysis is the 200-day moving average (MA), widely regarded as a barometer for the long-term market trend.
This indicator helps smooth out price data by creating a constantly updated average price, which can be pivotal in confirming the overall market direction. A rising 200-day MA suggests a long-term uptrend, while a decline might indicate a bearish market.
According to the chart shared by the analyst, Bitcoin’s performance below this key moving average currently confirms the cautious stance suggested by the ASOPR.
With the price hovering around $64,000, a 14% drop from its recent peak, the convergence of these indicators suggests that the market might still be in a phase of reassessment and potential adjustment.
Bitcoin Continued Stagnancy
The prediction from the metric above is quite evident, as Bitcoin’s value continues to fall despite significant positive developments within the industry.
Earlier today, Standard Chartered Plc announced the launch of a new trading desk for Bitcoin and Ethereum, marking a significant move into spot cryptocurrency trading by one of the world’s major banks.
Additionally, the Winklevoss twins, founders of the crypto company Gemini, have publicly supported Donald Trump’s presidential campaign, donating $1 million each BTC for being a “pro-Bitcoin” candidate.
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Nevertheless, these developments have not spurred any significant upward movement in Bitcoin’s price, which has seen a 1.1% decline in the past 24 hours to $63,935.
BTC price is moving downwards on the 1-hour chart. Source: BTC/USDT on TradingView.com
Analyst Ansem predicts that Bitcoin may not see a significant price increase until later this year, anticipating it will remain between $58,000 and $60,000 for some time.
Featured image created with DALL-E, Chart from TradingView
Data suggests the average cost of mining Bitcoin is standing around $86,700 right now. Here’s what history suggests could happen next for BTC.
Bitcoin Average Mining Cost Is Currently Notably Higher Than The Price
In a new post on X, analyst Ali Martinez has talked about how the average mining cost of BTC is looking like right now. The Bitcoin network runs on a consensus mechanism based on the “proof-of-work” in which validators called the miners compete against each other using computing power to get to hash the next block on the chain.
This computing power naturally has its running cost, with electricity being the most notable expense that the miners have to pay, given that it’s a perpetual cost. The incentive for spending capital on mining operations lies in the block rewards that these validators receive upon successfully adding the next block.
Obviously, mining expenses are different depending on location, as electricity prices aren’t the same everywhere. As such, the chart that Ali has cited from MacroMicro uses data provided by the Cambridge University on BTC electricity consumption to find out an average value.
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Below is the chart in question, which shows how the average mining cost on the Bitcoin network has changed over the past few years.
The value of the metric appears to have gone up in recent months | Source: @ali_charts on X
As is visible in the above graph, the Bitcoin average mining cost (colored in blue) had been below the price of the cryptocurrency earlier in the year, but recently, the former’s value has spiked and has surpassed the latter’s.
The reason behind this sudden increase is that there is another variable at play when calculating the average cost of mining Bitcoin: the Issuance, or the number of tokens that the miners are minting daily.
In general, the block rewards stay fixed both in value and frequency, so the Issuance of the network, which is nothing else than the sum of the block rewards mined in a day, more or less remains fixed as well.
Specific events, however, don’t abide by this. They are the Halvings. These periodic events that take place approximately every four years permanently slash the block rewards in half.
The latest such event, the fourth ever in the cryptocurrency’s history, occurred back in April. Naturally, the Halvings mean that the cost of mining 1 BTC drastically goes up, as miners only get half as many rewards as before after doing the same amount of work.
Thus, it’s not surprising that the cost of production for the coin observed a sharp increase coinciding with the latest Halving. At present, this metric stands at $86,700, meaning that according to MacroMicro’s model, the average miner would be underwater.
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Based on the past trend of the indicator, Ali has identified a pattern that Bitcoin has always followed. “Historically, BTC always surges above its average mining cost!” notes the analyst.
As such, if this pattern continues to hold for the current cycle as well, then it may only be a matter of time before Bitcoin surges past the $86,700 mark.
BTC Price
Bitcoin has gone through a drawdown of more than 5% recently, which has brought its price under the $66,000 level.
Looks like the price of the asset has observed bearish momentum recently | Source: BTCUSD on TradingView
Featured image from Dall-E, MacroMicro.me, chart from TradingView.com
Donald Trump promises to support Bitcoin and crypto mining if elected, which could result in surging BTC prices (according to ChatGPT).
Broader economic conditions, such as inflation and Federal Reserve policies, might also significantly influence the asset’s future valuation.
What Are BTC’s Chances?
The US presidential elections, scheduled for November this year, are supposed to witness a contested battle between current president Joe Biden and Republican candidate Donald Trump. The latter recently presented himself as the right choice for crypto enthusiasts, promising to let Bitcoin (BTC) and the industry thrive should he return to the White House.
Having that said, we decided to ask ChatGPT whether the price of the leading digital asset can reach the $100,000 milestone if Trump becomes America’s 47th president. The AI-powered chatbot estimated that his possible victory could indeed fuel a price rally for BTC:
“A Trump presidency might impact regulatory policies toward cryptocurrencies. If the administration adopts a more crypto-friendly stance, this could positively influence Bitcoin’s price.”
ChatGPT also claimed that BTC’s valuation could head north if Trump sticks to his promises related to the crypto sector. He recently pledged to increase the Bitcoin mining efforts of the United States, outlining the process as the “last line of defense against a CBDC.” Earlier this year, the billionaire said the digital dollar would be “very dangerous,” adding that he will never allow its creation (if he wins the elections).
Latest polls indicate that Donald Trump currently leads Biden by a slim margin: 41% versus 40% for his main opponent. Robert Kennedy, who collects 9.2% of voter support, is in third place.
Additional Factors
ChatGPT maintained that Trump’s possible election as the next president of the US is not the only element to fuel a BTC price rally. Broader economic conditions, such as inflation, geopolitical stability, and monetary policy, could also play a huge role.
Inflation in the States is one of the main things closely monitored by the Federal Reserve, which targets an annual rate of 2%. Once that percentage is reached (or even earlier), the central bank may pivot from its aggressive anti-inflationary regime and lower the interest rates.
The benchmark is currently positioned at 5.25%-5.50% and some industry participants expect the crypto market to head north once the Fed reduces the figure. After all, this will make money borrowing cheaper, potentially increasing the interest in risk-on assets such as BTC and the alternative coins.
Earlier this week, the US Bureau of Labor Statistics released its latest report, showing that inflation in America came lower than expected for May. However, the Fed decided to keep the rates unchanged: a movefollowed by a price decline for BTC.
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Bernstein analysts Gautam Chhugani and Mahika Sapra recently revised their price targets for Bitcoin in their latest market report, which also initiated coverage on MicroStrategy. These analysts also outlined factors that they believe could contribute to BTC’s exponential price surge.
Bitcoin To Hit $200,000 And Then $1 Million
Chhugani and Sapra predicted in the report that BTC will rise to a cycle high of $200,000 by 2025 and that the flagship crypto will reach $1 million by 2033. Bernstein had previously predicted that Bitcoin would reach $150,000 by 2025. However, these analysts have now revised their targets and alluded to the institutional demand for BTC as one of the reasons they believe the flagship crypto can reach such heights.
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The research firm predicts that the Spot Bitcoin ETFs will continue to record impressive demand and that the Bitcoin under management could reach $190 billion by 2025, a significant increase from the $60 billion in BTC that funds issuers already have under management.
In other words, these analysts expect BTC’s price to succumb to the supply and demand dynamics, considering that the Bitcoin in circulation is bound to drastically reduce as these Spot Bitcoin ETFs continue to accumulate a significant amount of the crypto token for their respective ETFs. Moreover, two Bitcoin halvings are set to occur before 2033, further reducing miners’ supply and thereby supporting their base case of BTC hitting $1 million.
MicroStrategy To Benefit From BTC’s Growth
These Berstein analysts also initiated coverage on MicroStrategy with an outperform rating. They predict that the software company’s stock can rise to $2,890 thanks to its BTC exposure. A rise to $2,890 represents about a 95% increase for MicroStrategy’s stock, which is currently valued at around $1,500.
The research firm noted that MicroStrategy has committed itself to “building the world’s largest Bitcoin company.” This has already paid off so far, with Chhugani and Sapra stating that the software company has transformed from a “small software company to the largest BTC holding company” since August 2020 (when it started accumulating BTC).
MicroStrategy already owns 1.1% of Bitcoin’s total supply, with holdings worth around $14.5 billion. The company’s BTC holdings are expected to increase soon enough, as they recently announced plans to offer $500 million of Convertible Senior Notes. Some of the proceeds from the proposed sale will be used to buy additional BTC.
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Berstein highlighted how the company’s co-founder Michael Saylor has become synonymous with the Bitcoin brand and that the company’s position as the leading Bitcoin company has helped attract “at scale capital (both debt and equity) for an active Bitcoin acquisition strategy.” In dollar terms, Bernstein noted that MicroStrategy’s Bitcoin net asset value (NAV) per share “has grown nearly fourfold, surpassing the 2.4x growth in Bitcoin’s spot price.”
“We believe MSTR’s long term convertible debt strategy allows it enough time to gain from Bitcoin upside, with limited liquidation risk to its Bitcoin on balance sheet.” Chhugani and Sapra added.
Bitcoin Could Experience A Massive Pump Above $73,000
Dippy suggested in an X (formerly Twitter) post that Bitcoin could enjoy a price pump once it reaches the liquidity zone around $73,000. He noted that many short traders have their stop losses or liquidation levels around that price level, which could be the catalyst for this price pump since liquidations of short positions can easily flush out the bears.
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Source: X
The crypto analyst also outlined another scenario that could play out, which presents a bearish outlook for Bitcoin. He claimed that Bitcoin’s surge to this liquidity zone could be a fakeout to take liquidity and then move down again. However, Bitcoin experiencing that pump once it hits $73,000 looks more likely, considering that crypto analyst James Check labeled the $73,000 price level as where Bitcoin could enter an escape velocity phase.
Crypto analyst Adrian Zduńczyk also suggested that Bitcoin would likely turn that $73,000 zone into support if it climbed to that level. He noted that Bitcoin has continued to consolidate inside its current ATH area for 14 weeks now, which is significant considering that this was an area where it had shown weakness before. Zduńczyk claims this is a “trend-promoting behavior” as resistance becomes the new support, and Bitcoin will continue to go higher.
Source: X
Meanwhile, crypto analyst Mikybull Crypto suggested that Bitcoin’s long-term consolidation in this range might be good, stating that the “longer the consolidation, the higher it moves when it breaks out.” He also remarked that Bitcoin’s bullish divergence also indicates “strong strength” for the flagship crypto. Mikybull Crypto expects Bitcoin to rise to $85,000 and then $110,000 when this long-awaited breakout happens.
Source: X
Crypto analyst Rekt Capital also noted that it is only a matter of time before the breakout happens. He had previously stated that a successful breakout for Bitcoin above the $70,000 range would send it into the ‘parabolic uptrend’ phase of this market cycle.
Why BTC Dropped Below $68,000
Bitcoin dropped below $68,000 following the significant outflows the US Spot Bitcoin ETFs recorded on June 10. Data from Farside Investors shows these funds saw a cumulative total of $64.9 million in outflows, the first time these Spot Bitcoin ETFs recorded daily outflows since May 23.
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Investors are believed to be waiting on the sidelines ahead of the US Consumer Price Index (CPI) inflation data and the US Federal Reserve interest rate decision on June 12. A lot of volatility is expected in the crypto market ahead of these events, which could determine the future trajectory of crypto assets.
Bitcoin has surged 2.9% in the last 24 hours, reaching a high of $71,166 on Binance today, marking the highest price since May 21. This rally appears to be primarily fueled by robust inflows into US spot Bitcoin ETFs, with the sector experiencing its 16th consecutive day of net inflows.
Why Is The Bitcoin Price Up Today?
Yesterday alone, these ETFs saw an inflow of $886.6 million, with Fidelity leading at $378.7 million—setting a new record for the fund. BlackRock wasn’t far behind, with substantial inflows totaling $274.4 million. Other significant contributions included Ark with $138.7 million, Bitwise at $61 million, and the Grayscale Bitcoin and VanEck Bitcoin Trust recording $28.2 million and $4 million respectively.
Good morning fellow hodlers,
We had an absolute insane day of inflows yesterday with $886.6 million of inflows (that’s ~12 500 BTC)
Fidelity did $378.7 million, Blackrock did $274.4 million, Ark did $138.7 million and Bitwise 61 million.
The sustained interest is further evidenced as BlackRock’s iShares Bitcoin ETF surpassed $20 billion in assets, becoming the fastest ETF to reach this milestone, reflecting significant momentum and investor enthusiasm.
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Eric Balchunas, a Bloomberg ETF analyst, emphasized the scale of these inflows, stating, “Fidelity not messing around, big-time flows all around today for The Ten, nearly $1b in total. Second best day ever, since Mid-March. $3.3b in past 4wks, net YTD at $15b (which was top end of our 12mo est). The ‘third wave’ is turning into a tidal wave.”
Despite the positive inflow dynamics, Byzantine General (@ByzGeneral), a prominent crypto analyst, observed that the price surge could have been more pronounced. He highlighted the presence of substantial passive supply on spot exchanges, which might have tempered the price increase.
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He noted yesterday, “High volume today, and the perps basis actually went down a bit. I think that we got good ETF flows today, but… They’re buying into a lot of passive supply on spot exchanges.” He further commented today, “What did I say, big ETF inflows. But because of all of the passive supply it’s like an unstoppable force colliding with an immovable object.”
BTC volume delta and cumulative volume delta | Source: X @ByzGeneral
Moreover, it’s important to note that the price increase was not driven by the liquidation of short positions in the BTC futures market, which saw only $27.58 million in shorts liquidated in the last 24 hours, according to Coinglass data.
However, Willy Woo, a renowned on-chain analyst, warned that a continued rise could trigger a significant short squeeze. Woo said via X, “Tapping 72k is the fuse that’s set to start a liquidation cascade. $1.5b of short positions ready to be liquidated all the way up to $75k and a new all time high.”
The crypto market is showing signs of a bullish resurgence, with reports of an impressive $2 billion in inflows for May alone.
Alongside this positive trend, Ethereum (ETH) has seen a notable turnaround in investor sentiment as the long-awaited spot exchange-traded funds (ETFs) for the market’s second-largest cryptocurrency received approval from the US regulators last week.
Record-Breaking Month For Crypto Products
According to a recent report from research firm CoinShares, digital asset investment products consistently attracted inflows during the four weeks, amassing a total of $185 million.
May proved to be particularly fruitful, with inflows surpassing $2 billion. This achievement marks the first time on record that year-to-date inflows have exceeded the $15 billion mark, highlighting investors’ growing interest in the crypto market.
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Most inflows originated from the United States, with a net inflow of $130 million. However, it is worth noting that ETF issuers experienced outflows amounting to $260 million.
Switzerland also witnessed a significant uptick in investor interest, recording its second-largest weekly inflow this year at $36 million. Meanwhile, Canada witnessed a positive turnaround, with inflows of $25 million, despite experiencing a net outflow of $39 million in May.
Ethereum Rebounds With $200M Inflows
Per the report, Bitcoin (BTC) continued to dominate the crypto market, attracting inflows totaling $148 million. Conversely, short-Bitcoin products witnessed another week of outflows, amounting to $3.5 million, suggesting that sentiment among ETF investors remains largely positive for the leading cryptocurrency.
Ethereum, on the other hand, experienced a notable change in investor sentiment following the Securities and Exchange Commission’s (SEC) approval of a spot-based ETF that is expected to launch in July 2024.
CoinShares notes that this approval marked a turning point for Ethereum, which had endured ten weeks of outflows totaling $200 million. Interestingly, the positive news for Ethereum had a ripple effect on Solana (SOL), which received an additional $5.8 million in inflows last week.
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While direct investments in crypto assets have been thriving, blockchain equities faced a different scenario. In the past week alone, blockchain equities witnessed outflows of $7.2 million.
The report notes that since the beginning of the year, the sector has suffered outflows totaling $516 million, reflecting a challenging period for blockchain-related stocks.
The 1-D chart shows ETH’s sideways price action between $3,700 and $3,900 over the past 10 days. Source: ETHUSD on TradingView.com
At the time of writing, Ethereum has seen a 4% price drop in the last week, resulting in a trading price of $3,770. However, the second-largest cryptocurrency on the market still holds gains of 21%, as recorded in the 30 days.
Featured image from DALL-E, chart from TradingView.com
Core Scientific’s 104 megawatt Bitcoin mining data center in Marble, North Carolina
Carey McKelvey
AUSTIN — For five years, bitcoin miner Core Scientific has quietly been diversifying out of mining and into artificial intelligence, a market that will require immense amounts of power to handle the training of AI models and the massive workloads that follow.
The move is no longer a secret.
On Monday, Core Scientific announced a 12-year deal with cloud provider CoreWeave to provide infrastructure for use cases like machine learning. Core Scientific said the agreement, which expands upon an existing partnership between the two companies, will add revenue of more than $3.5 billion over the course of the contract.
CoreWeave, backed by Nvidia, rents out graphics processing units (GPUs), which are needed for training and running AI models. CoreWeave was valued at $19 billion in a funding round last month. Core Scientific will deliver about 200 megawatts of infrastructure to CoreWeave’s operations.
Core Scientific, which emerged from bankruptcy in January, has been mining a mix of digital assets since 2017. The company began to diversify into other services in 2019.
“The best way to think about bitcoin mining facilities is that we are essentially power shells to the data center industry,” Core Scientific CEO Adam Sullivan told CNBC.
Sullivan jumped into the role of CEO while the company was still in the throes of bankruptcy, which resulted from the collapse of bitcoin in 2022. Since then, the former investment banker has settled debts with angry lenders and further beefed up the company’s non-bitcoin business as it reentered the public market.
Though Core is up more than 40% since relisting earlier this year, its market capitalization of around $865 million is significantly lower than its valuation of $4.3 billion in July 2021.
Demand for AI compute and infrastructure surged after OpenAI unveiled ChatGPT in Nov. 2022, setting off a rush of investment in AI models and startups. Meanwhile, Core Scientific and other miners like Bit Digital, Hive, Hut 8, and TeraWulf have been looking to bolster their revenue streams after the so-called bitcoin halving in April cut rewards paid out to bitcoin miners by 50%.
Many have been retrofitting their massive facilities to meet the needs of the market.
“Bitcoin miners, often stationed in energy-secure and energy-intensive data centers, find these facilities ideal for AI operations as well,” said James Butterfill, head of research at digital asset firm CoinShares.
Butterfill said the the overlap is leading to a competition for rack space between bitcoin mining and AI activities. While AI operations require up to 20 times the capital expenditure of bitcoin mining, they’re more profitable, according to a report from CoinShares.
“The introduction of AI activities leads to increased depreciation and amortization, which can enhance gross profit margins,” Butterfill said.
According to CoinShares, Bit Digital derives 27% of its revenue from AI. Hut 8 generates 6% of sales from AI, and Hive, which has data centers in Canada and Sweden, gets 4% of its revenue from these services.
Read more about tech and crypto from CNBC Pro
Hut 8 said in its first-quarter earnings report that it had purchased its first batch of 1,000 Nvidia GPUs and secured a customer agreement with a venture-backed AI cloud platform as part of its expansion into new technologies offering higher returns.
“We finalized commercial agreements for our new AI vertical under a GPU-as-a-service model, including a customer agreement which provides for fixed infrastructure payments plus revenue sharing,” said Hut 8 CEO Asher Genoot.
Genoot added that the company expects to begin generating revenue in the second half of the year at an annual rate of about $20 million.
Bit Digital had 251 servers actively generating revenue from its first AI contract as of the end of April, and the company said it earned about $4.1 million of revenue from the operation that month.
Iris Energy expects to generate between $14 million and $17 million in annual revenue from its AI cloud services. Core Scientific’s expanded arrangement with CoreWeave is expected to produce annual revenue of $290 million.
“While we intend to remain one of the largest and most productive bitcoin miners, we expect to have a diversified business model and more predictable cash flows,” Sullivan said.
Bitcoin’s volatility has made mining a challenging business.
Though bitcoin is currently up more than 150% in the past year to around $69,000, the bear market of 2022 sent many miners into bankruptcy or forced them to shutter altogether.
Pivoting to AI isn’t as simple as repurposing existing infrastructure and machines, because high-performance computing (HPC) data center requirements are different, as are the needs of the data network.
“Besides transformers, substations, and some switch gear nearly all infrastructure miners currently have would need to be bulldozed and built from the ground up to accommodate HPC,” Needham analysts wrote in a report on May 30.
The rigs used to mine bitcoin are called Application-Specific Integrated Circuits (ASICs). They’re built specifically for crypto mining and can’t be used to do other things.
Needham estimates that HPC data centers run at $8 million to $10 million per megawatt in capex, excluding GPUs, whereas bitcoin mining sites typically operate at $300,000 to $800,000 per megawatt in capex, not including ASICs.
Core’s Sullivan says there’s a lot of synergy between the two businesses.
“One of the most exciting parts about the bitcoin mining business is we have access to large amounts of power across the United States with access to fiber lines,” he said.
Beyond its partnership with CoreWeave, Core Scientific has also announced that over the next three to four years, it’s working to convert 500 megawatts of its bitcoin mining infrastructure across the country to HPC data centers.
Sullivan said the retrofit is manageable because the company owns and controls all of its data center infrastructure.
“There are components that we have to purchase to retrofit for HPC, but it is things that we can easily acquire,” he said.
In the next one to two years, Needham analysts estimate that large publicly traded bitcoin miners are expected to more than double power capacity, including both their mining and HPC business expansion plans.
Clean energy is a popular choice because it’s the cheapest power source in many markets. Miners at scale compete in a low-margin industry, where their only variable cost is typically energy, so they’re incentivized to migrate to the world’s cheapest sources of power. An industry report estimates the bitcoin network is 54.5% powered by sustainable electricity.
The Electric Power Research Institute estimates that data centers could take up to 9% of the country’s total electricity consumption by 2030, up from around 4% in 2023. Tapping into nuclear energy is seen by many as the answer to meeting that demand.
TeraWulf powers its mining sites with nuclear energy, and is looking to get into machine learning. So far, the firm has two megawatts dedicated to HPC capacity, though it has plans to transition its energy infrastructure toward AI and HPC.
OpenAI CEO Sam Altman told CNBC last year that he’s a big believer in nuclear when it comes to serving the needs of AI workloads.
“I don’t see a way for us to get there without nuclear,” Altman said. “I mean, maybe we could get there just with solar and storage. But from my vantage point, I feel like this is the most likely and the best way to get there.”
CryptoQuant CEO Ki Young-Ju today pointed out significant similarities in Bitcoin’s market behavior between the current state and mid-2020, a period marked by stagnant prices but high on-chain activity. Young-Ju’s insights were illustrated with two key charts and shared via a post on X, drawing parallels that suggest a robust undercurrent of large volume transactions, potentially outside the public exchange networks.
Bitcoin realized cap for new whales | Source: X @ki_young_ju
The first chart, representing data up until 2020, shows Bitcoin’s price alongside the realized cap for new whales – a metric that tracks the aggregate value at which the newly acquired Bitcoin by large investors was last moved. It’s a different form of market capitalization that assesses each UTXO at the price it last changed hands, rather than its present market price. This metric reflects the actual realized value of all the coins in the network, rather than their current market value.
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This value experienced a sharp increase around mid-2020, precisely when Bitcoin’s price was caught in boredom just like in recent months, consistently trading around the $10,000 mark. According to Young-Ju, this period was characterized by high on-chain activity which later analysis suggested involved over-the-counter (OTC) transactions among institutional players.
In the second chart, extending to 2024, a similar pattern emerges with even more pronounced growth in the realized cap for new whales, despite Bitcoin’s price showing a sideways movement for almost 100 days now. The chart indicates a significant addition of about $1 billion daily into new whale wallets, a term typically referring to addresses holding large amounts of Bitcoin, often linked with institutional or highly capitalized individual investors.
What This Means For Bitcoin Price
Ki Young-Ju elaborated on these observations: “Same vibe on Bitcoin as mid-2020. Back then, BTC hovered around $10k for 6 months with high on-chain activity, later revealed as OTC deals. Now, despite low price volatility, on-chain activity remains high, with $1B added daily to new whale wallets, likely custody.”
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He further referenced a tweet from September 2020 that corroborated his analysis, noting that the “number of BTC transferred hits the year-high, and those TXs are not from exchanges. Fund Flow Ratio of all exchanges hits the year-low. Something’s happening. Possibly OTC deals.”
This comparison and the sustained high level of the realized cap for new whales suggest an ongoing accumulation phase among large-scale investors, reminiscent of the activity observed in mid-2020. Such movements are generally not visible on traditional crypto exchanges and indicate a strong institutional interest that could be a precursor to significant market moves. Following Young-Ju’s tweet, BTC price rallied by 480% from September 2020 till November 2021.
If a similar move is brewing for Bitcoin price remains to be seen, but the continuous growth in Bitcoin holdings among new whales, along with sustained price levels, points to a potential buildup of pressure beneath the apparent calm of the market surface. As observed in the past, such conditions may lead to substantial price movements once the accumulated Bitcoin begins to impact the broader market through either increased liquidity or renewed trading interest.
“We ultimately got lucky that our parameters and time range was right. If either of those were wrong, we would have … continued to take guesses/shots in the dark,” Grand says in an email to WIRED. “It would have taken significantly longer to precompute all the possible passwords.”
Grand and Bruno created a video to explain the technical details more thoroughly.
RoboForm, made by US-based Siber Systems, was one of the first password managers on the market, and currently has more than 6 million users worldwide, according to a company report. In 2015, Siber seemed to fix the RoboForm password manager. In a cursory glance, Grand and Bruno couldn’t find any sign that the pseudo-random number generator in the 2015 version used the computer’s time, which makes them think they removed it to fix the flaw, though Grand says they would need to examine it more thoroughly to be certain.
Siber Systems confirmed to WIRED that it did fix the issue with version 7.9.14 of RoboForm, released June 10, 2015, but a spokesperson wouldn’t answer questions about how it did so. In a changelog on the company’s website, it mentions only that Siber programmers made changes to “increase randomness of generated passwords,” but it doesn’t say how they did this. Siber spokesman Simon Davis says that “RoboForm 7 was discontinued in 2017.”
Grand says that, without knowing how Siber fixed the issue, attackers may still be able to regenerate passwords generated by versions of RoboForm released before the fix in 2015. He’s also not sure if current versions contain the problem.
“I’m still not sure I would trust it without knowing how they actually improved the password generation in more recent versions,” he says. “I’m not sure if RoboForm knew how bad this particular weakness was.”
Customers may also still be using passwords that were generated with the early versions of the program before the fix. It doesn’t appear that Siber ever notified customers when it released the fixed version 7.9.14 in 2015 that they should generate new passwords for critical accounts or data. The company didn’t respond to a question about this.
If Siber didn’t inform customers, this would mean that anyone like Michael who used RoboForm to generate passwords prior to 2015—and are still using those passwords—may have vulnerable passwords that hackers can regenerate.
“We know that most people don’t change passwords unless they’re prompted to do so,” Grand says. “Out of 935 passwords in my password manager (not RoboForm), 220 of them are from 2015 and earlier, and most of them are [for] sites I still use.”
Depending on what the company did to fix the issue in 2015, newer passwords may also be vulnerable.
Last November, Grand and Bruno deducted a percentage of bitcoins from Michael’s account for the work they did, then gave him the password to access the rest. The bitcoin was worth $38,000 per coin at the time. Michael waited until it rose to $62,000 per coin and sold some of it. He now has 30 BTC, now worth $3 million, and is waiting for the value to rise to $100,000 per coin.
Michael says he was lucky that he lost the password years ago because, otherwise, he would have sold off the bitcoin when it was worth $40,000 a coin and missed out on a greater fortune.
“That I lost the password was financially a good thing.”
The world’s largest cryptocurrency, Bitcoin (BTC), has been consolidating over the past week, trading between $67,000 and $70,000 after experiencing a brief 20% price correction that sent it as low as $56,400 in early May.
This consolidation period comes as inflows into the US spot Bitcoin ETF market have reignited, and selling pressure appears to have cooled off, both in the ETF market and among Bitcoin investors more broadly.
Bitcoin Selling Pressure Fades
According to Julio Moreno, head of research at on-chain market analytics firm CryptoQuant, the current Bitcoin price level of $70,000 differs from when it last reached that mark in March.
Moreno notes that traders are now exerting much lower selling pressure, as unrealized profits are only around 3%, compared to 69% in early March. This suggests that much of the “heavy selling” has been exhausted, as seen in the chart below.
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Unrealized gains for BTC holders are only 3%. Source: Julio Moreno on X
Santiment data also shows that Bitcoin has once again eclipsed a $70,000 market capitalization, even as the US stock market took a hiatus for the Memorial Day holiday.
Market intelligence platform Santiment sees this as an encouraging sign, as it demonstrates BTC’s ability to perform positively on days when it is not closely correlated with the primary stock market, which has been the case for much of 2022.
Final Pre-Breakout Consolidation Phase
Despite this positive momentum, crypto analyst Rekt Capital has noted that Bitcoin’s latest weekly candle closed below the range high resistance of its ongoing “re-accumulation” phase, which spans roughly $60,000 to $70,000.
This likely sentences the leading cryptocurrency to further consolidation within this range, aligned with Rekt Capital’s thesis that two phases remain in the current bull cycle: the post-halving re-accumulation phase and the “parabolic rally phase.”
Historically, Bitcoin has tended to consolidate around all-time highs before embarking on the most illustrative stretch of its bull cycles. According to the analyst, Bitcoin has indeed been consolidating at these highs for quite some time now, especially by the standards of previous cycles.
While there is still room for further sideways trading at these elevated price levels, the time remaining in this phase is slowly running out. This leads to the belief that the long-awaited post-Halving rally, coupled with renewed investor sentiment, is poised to take the largest cryptocurrency on the market to even higher levels than the current $73,700 reached in mid-March.
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As such, Bitcoin appears to be entering a critical juncture in its current bull cycle. The consolidation and re-accumulation that has dominated the market in recent months could soon give way to the next parabolic surge, should historical patterns hold.
As of now, BTC has gained 2% in the past 24 hours, adding to its 10% positive movement in the past month alone. Bitcoin is currently trading at $70,200.
Featured image from Shutterstock, chart from TradingView.com
Bitcoin whales are not backing down from the market and have continued to capitalize on the pump by buying every dip. The most recent dip toward $60,000 saw these large investors gobble up BTC at an alarming rate, with their daily spending coming in at billions of dollars.
Bitcoin Whales Buy $6.3 Billion Worth Of BTC
In a stunning discovery, co-founder of Bitcoin-based company Apollo, Thomas Fahrer, revealed that Bitcoin whales have been rapidly buying up the tokens amid price drawdown. More specifically, the daily spend of these whales caught Fahrer’s eye.
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The report shared by the founder shows that while smaller investors had been selling, Bitcoin whales were buying up billions of dollars worth of coins. In the 24-hour period, these whales holding more than 1,000 BTC on their balances accumulated 8,953 BTC, worth $6.3 billion at the time. This further adds to their weekly accumulation numbers, coming out at 12,058 BTC, which is almost $9 billion worth of BTC bought in one week.
Whales accumulated $6.3 Billion worth of #Bitcoin Yesterday.
— Thomas | heyapollo.com (@thomas_fahrer) May 22, 2024
This accumulation trend comes in light of smaller investors selling their tokens. For example, Fahrer’s screenshot show Sharks, which are investors holding between 100-1,000 BTC on their balances sold 6,746 BTC in one day, worth around $5 billion.
Other notable sellers include the crabs, which are investors holding 1-10 BTC, selling 1,074 BTC in the same time period. Shrimps – investors holding 0-1 BTC, were also caught selling, with a total of 591 BTC sold. While Fish investors, those holding 10-100 BTC, sold only 95 BTC in the one day period.
The flow of these investors shows that BTC is flowing out from smaller investors toward larger investors, something that is bullish for the price. The same is the case on the weekly timeframe where Shrimps sold 2,079 BTC, Crabs sold 5,748 BTC, Fish sold 1,155 BTC, while Sharks bought up 60 BTC, with Bitcoin whales buying the majority with 12,085 BTC.
Time To Buy
A number of crypto analysts have called for buying and it seems Bitcoin whales are the ones following this advice. One of the analysts who has been vocal about it being the time to buy is Ali Martinez, who shared an interesting formation on the Bitcoin chart.
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Martinez pointed out that the TD Sequential, which had previously predicted the Bitcoin price movement, had flashed a buy signal. The level at which this analyst presented this buy signal was around the $69,500 level, and since then, the BTC price has since rebounded above $70,000, suggesting the buy signal was correct.
The TD Sequential has accurately predicted #Bitcoin price action on the one-hour chart. Now, it presents a buy signal, anticipating $BTC will rebound! pic.twitter.com/6ImRkREPVW
If the TD Sequential holds like it did the last time it appeared, then the current price push could see Bitcoin reach a new all-time high above $74,000, since the last one saw an almost 15% move. But for now, Bitcoin bulls are fighting to maintain its position above $70,000, with a 12.22% increase in the last week.
American broadcaster and Bitcoin proponent Max Keiser believes the stablecoin issuer Tether and El Salvador, as well as the declining United States dollar (USD), will push BTC’s price to $220,000 in no distant time.
In a Saturday tweet, Keiser said the USD is doomed because inflation will “sky harder,” while this happens, BTC will be well on its way to $220,000.
The USD Is “F****d”
In comments sent to CryptoPotato, Keiser explained that Tether’s stablecoin business is strengthening Bitcoin and weakening the USD, which forces the U.S. government to keep raising interest rates.
According to the Bitcoin bull, every country in the BRICS union, including China and Russia, has understood that the United States is dying in a debt trap of its making, possibly leading to hyperinflation in the printing of USD. As a result, China and Russia are discarding the USD as the world reserve currency and conducting bilateral deals instead.
Worse still, BRICS is reportedly launching a new, gold-backed digital currency later this year, putting “the final nail” into the dollar and the North Atlantic Treaty Organization (NATO).
While BRICS continues its fight against the U.S., American financial services firm Cantor Fitzgerald and Tether have an ongoing speculative attack against the dollar, Keiser added. Unfortunately, the attack would hasten the demise of the fiat currency.
Tether’s Role in The Dollar’s Demise
Millions of crypto users swap fiat money for Tether (USDT), and the stablecoin company, in turn, swaps the fiat for U.S. treasuries at Cantor, using the interest paid by the firm to buy more BTC. With the increasing rates in the U.S., Tether’s profits are rising, as are the company’s BTC purchases.
“It’s a USD doom loop that can’t be stopped,” Keiser said.
Besides Tether, Michael Saylor’s business intelligence firm MicroStrategy is part of the speculative attack, according to Keiser. The broadcaster said the difference between the two firms is that MicroStrategy has to “dilute shareholders with serial issuance of preferreds,” while Tether does not need to pay any interest.
With time, the pace of BTC purchases from several entities, including Tether, MicroStrategy, and El Salvador, will explode, Keiser noted. Speaking about the first country to legalize BTC as a legal tender, Keiser, who has had several meetings with the nation’s President, said:
“El Salvador is always looking to increase its bitcoin position, substantially so.”
On the other hand, the dollar will implode, and soon, no market participant will accept fiat for BTC. The rise in BTC purchases would push the asset’s value to $220,000, he asserted.
By the time the U.S. launches their central bank digital currency, it would be too late, as the BRICS currency will be the world reserve currency, Bitcoin will be the world’s reserve asset, and Tether will be the global replacement for the SWIFT network.
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A crucial Bitcoin metric has just turned bullish, sparking optimism from a crypto analyst regarding an impending rally for Bitcoin. This unique technical pattern suggests that the world’s largest cryptocurrency could see its price ascending further, potentially kick-starting a highly welcomed bull run this cycle.
Bitcoin Technical Pattern Flips Bullish
Bitcoin’s price has often followed distinct historical patterns, with the majority of these indicators preceding significant rallies or bearish trends. One of the most compelling signs that Bitcoin may be turning bullish again is seen as the Stablecoin Supply Ratio (SSR) Oscillator breaks below the lower Bollinger Bands, a technical indicator used to measure a market’s volatility and momentum.
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According to a crypto analyst identified as ‘Dominando Cripto’ on X (formerly Twitter), the SSR is a unique technical tool designed to evaluate the market sentiment by comparing the supply of stablecoins to Bitcoin. This tool is used by analysts and traders to identify buying and selling opportunities for Bitcoin. Additionally, it quantifies how the 200-day Simple Moving Average (SMA) of the SSR moves within the Bollinger Bands.
Source: X
Dominando Cripto has provided an in-depth explanation of how the SSR oscillator is calculated and how to interpret its signals for identifying bullish trends.
“The oscillator is calculated by taking the difference between the current Stablecoin Supply Ratio value and its 200-day Simple Moving Average (SMA), then dividing it by the standard deviation of the SSR over the same period,” the analyst stated.
Sharing a price chart depicting movements of the SSR oscillator, the crypto analyst suggests that when the oscillator moves above the upper Bollinger Bands, it suggests that the SSR is significantly higher than normal levels. This indicates that stablecoins are dominating the market, signaling bearish sentiment and a potential downturn for Bitcoin.
Conversely, when the oscillator falls below the lower Bollinger Band, it indicates that the SSR is low, highlighting the reduced dominance of stablecoins and signaling bullish sentiment that could potentially trigger an incoming rally in Bitcoin.
In the above price chart, Dominando Crypto pinpointed several instances when the SSR oscillator displayed bearish and bullish sentiment, identifying these periods as heated zones and cold zones, respectively. Recent market movements indicate that the SSR oscillator is in the cold zone, indicating a potential bullish outlook for Bitcoin.
More Bullish Signs For BTC
On May 18, Blockchain analytics platform, Santiment, revealed a new market trend where small traders are consistently liquidating their BTC holdings, even as the cryptocurrency has shown positive performance lately.
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The analytics platform noted that historically, when small wallets dump coins into larger wallets, it is considered an encouraging sign for Bitcoin, indicating a potential bullish turnaround for the pioneer cryptocurrency.
At the time of writing, Bitcoin’s price is trading at $66,955, according to CoinMarketCap. The cryptocurrency has been on a major bullish momentum recently, witnessing an 8.94% increase in the last seven days and a 4.25% surge over the past month.
Popular crypto analyst Michaël van de Poppe continues to back altcoins to put up a spectacular bullish performance in the coming months. In a new X post on Saturday, the veteran analyst takes a deeper dive explaining the reasons behind his advocacy for altcoins investment ahead of a highly expected crypto bull run.
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Investing In Altcoins Is The Best, Analyst Says Why
In his most recent bullish prediction on altcoins, van de Poppe begins by stating these tokens may not present as the most ideal investment especially considering that their combined value is down by 70% against Bitcoin in the last three months.
The analyst has attributed this poor performance to several factors including a delay in network updates and an extended bear market. In addition, van de Poppe also notes Ethereum’s current struggles to be a significant contributor to this market downturn.
He explains that typically the crypto bullish hype moves from Bitcoin to Ethereum, followed by tokens with big market cap, then middle-cap tokens and small-cap tokens.
However, this cycle appears to be experiencing some delay due to a bearish cloud over Ethereum, driven by uncertainty over the approval of a proposed spot exchange-traded fund (ETF) as well as its asset class.
Nevertheless, van de Poppe believes this delay to be quite temporary as he postulates that market traders are currently pricing in any potential negative effect from the denial of an Ethereum Spot ETF or the classification of the prominent altcoin as a security.
Once Ethereum embarks on a bullish course, van de Poppe predicts other altcoins to follow suit. The analyst projects that certain tokens could record a 1000% gain as seen between October 2023-February 2024, amid the hype around Bitcoin spot ETFs.
However, the analyst nudges investors to buy into the altcoin market now during the period of “lowest confidence”. He believes such an act is similar to investing in Bitcoin at $3,700 at the start of 2020, thus ensuring investors generate maximum profits in the coming bull run.
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Ethereum ETF Approval In The Balance
As weeks continue to progress, the approval of an Ethereum spot ETF by the US Securities and Exchange Commission (SEC) appears highly uncertain.
This sentiment is driven by the Commission’s ongoing deliberation on whether to classify Ethereum as a security as well as a lack of dialogue between the agency and prospective issuers. The next deadline dates are for May 23/May 24, during which the SEC will respond to 2 ETF applications with many analysts expecting further delays from the Commission.
At the time of writing, Ethereum trades at around $3,123.39 reflecting a 0.53% increase in the last day.
ETH trading at $3,121.19 on the daily chart | Source: ETHUSDT chart on Tradingview.com
Featured image from Business Insider, chart from Tradingview
Coinbase became arguably the most important crypto player in the US this year as numerous ETF providers, including BlackRock, chose the platform to serve as custodian to their Bitcoin exchange-traded funds.
Adding the overall bull run for the entire market resulted in positive price movements for its shares, which jumped to over $250 earlier this year. However, COIN dumped hard on Thursday, perhaps due to rising competition on local soil.
The Brian Armstrong-spearheaded company has become something of a monopolist on the Bitcoin ETF custodian front mostly because it is among the few publicly-traded crypto exchanges in the States.
This benefited the company during the first quarter of 2024 – when the ETFs launched – and its Q1 report beat expectations, posting a massive revenue surge of 72%.
Naturally, this also impacted Coinbase’s shares, which jumped from about $156 at the start of the year to a multi-month peak of $280 in late March, taking advantage of the broader crypto market resurgence and BTC’s new ATH.
However, COIN started to retrace alongside the rest of the market in April and May but still maintained a healthy level of over $200. That changed yesterday when the shares dropped by 9.43% from $215 to $199.
The most probable reason for this is not related to the market moves, as BTC was well in the green, skyrocketing to a 3-week high of over $66,500. In fact, it could be related to impending competition on the spot trading front in the US.
CME Group, typically known for its involvement in futures Bitcoin and Ethereum trading, outlined initial plans to introduce spot BTC trading services. Given the fact that CME is a well-established player in traditional finance and has a rich history in crypto, such a potential launch could take away market share for dominant forces like Coinbase and Binance.
Separately, Cathie Wood’s Ark Invest has been gradually offloading its COIN shares for the past few weeks, which could also increase the selling pressure.
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Bitcoin prices have been trending lower in the past couple of weeks and generally remain within a bearish formation. Although momentum appears to be picking up, bulls are not out of the woods just yet.
Analysts are not losing hope and remain overly upbeat, expecting a surge that would take the world’s most valuable coin to new levels.
Bitcoin Forms A “Cup And Handle” Formation In The Weekly Chart
In a post on X, one of them, MikybullCrypto, said Bitcoin has formed a “cup and handle” reversal pattern, suggesting an imminent surge towards new all-time highs. This formation is a glimmer of hope for optimistic traders, especially now that prices have been moving lower and sideways, erasing gains posted in March.
BTC forms a cup and handle pattern | Source: @MikybullCrypto via X
The “cup and handle” formation is a technical pattern chartists use to identify potential reversals and confirm trend continuations. In the current setup, as identified by the trader on the weekly chart, the “handle” was formed after the recent price drop from all-time highs. The “cup” follows the price decline in 2022 and the subsequent recovery in 2023.
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Historically, if there is a breakout above the handle and the rim of the cup, prices tend to rally to new levels. For this reason, the analyst says that if buyers press on from spot rates, the breakout above the current range and all-time highs of $73,800 will be “explosive.”
For now, prices remain in a descending channel with clear resistance levels marked out in the immediate term at around $66,000 and $72,000. A breakout, reading from the candlestick formation in the daily chart, above these liquidation levels could spark demand, lifting the coin to new levels.
Will Miners Dump BTC And Force Prices Lower?
However, lurking beneath the optimistic outlook is a potential storm cloud: declining on-chain activity. After the brief spike in on-chain activity on Halving Day due to the launch of the Runes protocol, transaction fees have been declining.
According to YCharts, it is currently at $3.206, down from over $128 on April 20. This contraction means miners are getting less revenue, heaping more pressure now that there is more pressure on margins post-Halving.
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Now that miners are feeling the pinch of slashed block rewards and declining transaction fees, it is likely that they might liquidate some of their BTC to stay afloat. Their participation, especially in the secondary market, would heap more pressure on BTC, forcing prices lower.
Feature image from Shutterstock, chart from TradingView
