NEW YORK — NEW YORK (AP) — Bitcoin has hit an all-time high less than two years after the collapse of the crypto exchange FTX severely damaged faith in digital currencies and sent prices plunging.
The world’s largest cryptocurrency jumped 4% this week and briefly surpassed $68,800 Tuesday, according to CoinMarketCap. That’s just above bitcoin’s previous record set back in November 2021.
Then the volatile asset dipped 4%, standing at just over $65,000 but the price is still up almost 200% from one year ago after a meteoric rise.
Gains in recent months have been fueled by the anticipation and eventual U.S. approval of bitcoin exchange traded funds earlier this year, which provided access to a much broader class of investors. The price for bitcoin has surged about 60% since the approval of bitcoin ETFs in January, an easy way to invest in assets or a group of assets — like gold, junk bonds or bitcoins — without having to directly buy the assets themselves.
Also driving prices is what is known as bitcoin “halving” which is anticipated in April. Halvings trim the rate at which new coins are mined and created, thus lowering the supply.
Here’s what you need to know.
In January, the U.S. Securities and Exchange Commission approved the first spot bitcoin ETFs from asset managers including Blackrock, Invesco and Fidelity. These newly-approved ETFs hold actual bitcoin — unlike previous bitcoin-related ETFs that were invested in contracts related to future price bets, but not on the cryptocurrency itself.
While regulators have pointed to persisting risks and maintained reluctance around January’s decision, the greenlight marked a major win the crypto industry.
Institutional demand for bitcoin show “no signs of slowing down,” H.C. Wainwright’s Mike Colonnese and Dylan Scales wrote Tuesday — adding that bitcoin’s popularity “is likely to accelerate in the coming months as more wealth management platforms make spot (bitcoin) ETFs accessible to their clients.”
Using data from crypto platform BitMEX, Colonnese and Scales estimated that the ten bitcoin ETFs averaged $302 million in net daily inflows for the month of February. Last week alone, these spot ETFs booked record inflows of $1.7 billion — bringing total net inflows to $7.5 billion since their Jan. 11 launch.
Increased demand is also aligning with bitcoin’s next halving event, which is expected at the end of April.
Bitcoin halving, which occurs every four years, is when the reward for bitcoin mining is cut in half. This reduces how fast new coins are created — making supply more scarce.
While analysts say that constrained supply in a time of high demand can push bitocin’s price higher over time, others point to significant volatility that has resulted before and after halving events — and the possibility of sizable declines.
“Past history may not be a reliable guide to predict how the upcoming halving of bitcoin will influence its value,” Rajeev Bamra, SVP of digital finance at Moody’s Investors Service, noted. “Various external factors, market sentiment shifts, and regulatory developments can influence the trajectory of Bitcoin’s price.”
Bitcoin has a history of drastic swings in value — which can come suddenly and happen over the weekend or overnight in trading that continues at all hours, every day.
Bitcoin rocketed from just over $5,000 at the start of the pandemic to its November 2021 peak of nearly $69,000, in a period marked by a surge in demand for technology products. Prices crashed during an aggressive series of Federal Reserve rate hikes intended to cool inflation, slow money flows and make risky investments potentially riskier. Then came the 2022 collapse of FTX, which left a significant scar on confidence in crypto.
At the start of last year, a single bitcoin could be had for less than $17,000. Investors, however, began returning in large numbers as inflation started to cool. And 2023’s collapse of prominent tech-focused banks actually led more investors to turn to crypto as they bailed out of positions in Silicon Valley start-ups and other risky bets.
Despite the recent excitement around bitcoin, experts still maintain that crypto is a risky bet with wildly unpredictable fluctuations in value. In short, investors can lose money as quickly as they make it.
“It’s essential to exercise caution and acknowledge that the road ahead for the digital finance ecosystem, particularly the crypto markets, is expected to navigate through a period marked by volatility,” Bamra noted — pointing the importance of “cautious optimism.”
Crypto fanatics eager for a market-shattering Ethereum spot ETF launch may be in for an underwhelming surprise, according to Bloomberg ETF analyst Eric Balchunas.
While the recent launch of multiple Bitcoin spot ETFs in the United States has proven phenomenally successful, Balchunas claims a follow-up launch for Ethereum would be “small potatoes” compared to the original.
“No offense to the ETH people but this is such small potatoes vs spot bitcoin ETFs. It’s like the opening act coming on after the headliner. Using GenX bands, it’s like Sister Hazel trying to follow Nirvana.”
Balchunas explained that his prediction is based on both anecdotal and public data suggesting that the Ethereum ETFs will be “nothing close” to their Bitcoin-based equivalents, which have hauled over $7 billion in net flows since launching on January 11.
Before launching, asset managers fought a lengthy legal war with the Securities and Exchange Commission (SEC) to get Bitcoin spot ETFs approved for public securities exchanges, due to major disagreements about whether the Bitcoin market was prone to external manipulation.
After Grayscale prevailed over the agency in court last year, the firm quickly applied to launch an Ethereum spot ETF, later followed by BlackRock and Fidelity – the three largest providers of Bitcoin spot ETFs today.
Ethereum VS Bitcoin ETFs: What We Know
Though many are confident the SEC will again be forced to approve the product, whether or not the market wants to buy it remains questionable. For instance, Ethereum futures ETFs launched in October last year, but generated tiny flows and volume compared to Bitcoin’s first futures ETF in October 2021.
Looking to Canada’s spot ETFs, the Purpose Ether ETF currently boasts an AUM of $458 million CAD, versus the $2.5 billion AUM with the company’s Bitcoin ETF. For context, Ether’s global market cap is roughly one-third the size of Bitcoin’s, meaning it may be relatively less popular within an ETF wrapper than BTC.
Per a Bitwise survey of registered investment advisors conducted last year, 71% of advisors said they favored Bitcoin over Ethereum.
In comments shared with CryptoPotato in November, the asset manager explained that ETFs would be more meaningful for Bitcoin than for Ethereum, due to institutional investors’ general ignorance about the difference between the two assets.
SPECIAL OFFER (Sponsored)
Binance Free $100 (Exclusive): Use this link to register and receive $100 free and 10% off fees on Binance Futures first month (terms).
The ransomware attack targeting medical firm Change Healthcare has been one of the most disruptive in years, crippling pharmacies across the US—including those in hospitals—and leading to serious snags in the delivery of prescription drugs nationwide for 10 days and counting. Now, a dispute within the criminal underground has revealed a new development in that unfolding debacle: One of the partners of the hackers behind the attack points out that those hackers, a group known as AlphV or BlackCat, received a $22 million transaction that looks very much like a large ransom payment.
On March 1, a Bitcoin address connected to AlphV received 350 bitcoins in a single transaction, or close to $22 million based on exchange rates at the time. Then, two days later, someone describing themselves as an affiliate of AlphV—one of the hackers who work with the group to penetrate victim networks—posted to the cybercriminal underground forum RAMP that AlphV had cheated them out of their share of the Change Healthcare ransom, pointing to the publicly visible $22 million transaction on Bitcoin’s blockchain as proof.
That suggests, according to Dmitry Smilyanets, the researcher for security firm Recorded Future who first spotted the post, that Change Healthcare has likely paid AlphV’s ransom. “You can see the number of coins that landed there. You don’t see that kind of transaction so often,” Smilyanets says. “There’s proof of a large amount landing in the AlphV-controlled Bitcoin wallet. And this affiliate connects this address to the attack on Change Healthcare. So it’s likely that the victim paid the ransom.”
A spokesperson for Change Healthcare, which is owned by UnitedHealth Group, declined to answer whether it had paid a ransom to AlphV, telling WIRED only that “we are focused on the investigation right now.”
Both Recorded Future and TRM Labs, a blockchain analysis firm, connect the Bitcoin address that received the $22 million payment to the AlphV hackers. TRM Labs says it can link the address to payments from two other AlphV victims in January.
If Change Healthcare did pay a $22 million ransom, it would not only represent a huge payday for AlphV, but also a dangerous precedent for the health care industry, argues Brett Callow, a ransomware-focused researcher with security firm Emsisoft. Every ransomware payment, he says, both funds future attacks by the group responsible and suggests to other ransomware predators that they should try the same playbook—in this case, attacking health care services that patients depend on.
“If Change did pay, it’s problematic,” says Callow. “It highlights the profitability of attacks on the health care sector. Ransomware gangs are nothing if not predictable: If they find a particular sector to be lucrative, they’ll attack it over and over again, rinse and repeat.”
The self-described AlphV affiliate who first posted evidence of the payment on RAMP, and who goes by the name “notchy,” complained that AlphV had apparently collected the $22 million ransom from Change Healthcare and then kept the entire sum, rather than share the profits with their hacking partner as they had allegedly agreed. “Be careful everyone and stop deal with ALPHV,” notchy wrote.
Floki Inu (FLOKI), a canine-themed cryptocurrency, has witnessed a remarkable surge in its price, capturing the attention of investors, traders, and enthusiasts alike. The coin’s value has experienced a sharp increase, with the past 24 hours alone seeing a surge of over 50%.
FLOKI Tallies An Impressive 336% Weekly Gain
However, it is the weekly timeframe that has truly astounded market observers, as FLOKI recorded an impressive rally of 336%. This surge in price comes on the heels of a community-backed proposal to burn 2% of the token’s supply.
The proposal to burn tokens was met with overwhelming support from the community, with nearly 90% of votes favoring the initiative. The top voter staked a staggering 117 billion tokens, demonstrating the belief in the long-term security and stability of the Floki project.
IT’S OFFICIAL: FLOKI DAO PASSES VOTE TO BURN 190,918,585,431.84 FLOKI TOKENS
The #Floki DAO has voted in favor of burning 190,918,585,431.84 $FLOKI tokens. At the current market value, this is worth over $24 MILLION.
The burn event is scheduled to take place after a seven-day period, and its purpose is to minimize the risks associated with token exploitation and dumping, thereby ensuring the project’s sustainability.
Social Media Buzz And Positive Sentiment
An investigation by NewsBTC has revealed a surge in social media mentions for Floki Inu in recent days, indicating the continued popularity of the meme coin within the cryptocurrency community.
Moreover, a rise in weighted sentiment suggests that positive views towards the token prevail at the time of writing. This growing social media buzz and optimistic sentiment have played a role in attracting attention to Floki Inu and contributing to its meteoric rise in value.
Source: Santiment
FLOKI Total Value Locked Soars
Meanwhile, Floki has reached a noteworthy accomplishment. Total Value Locked (TVL) across its ecosystem goods has exceeded $400 million. This accomplishment follows the cryptocurrency’s all-time high of $366 million, which showed its quick rise and investor appeal.
FLOKI CROSSES RECORD $400M IN TVL#Floki has just crossed $400M in TVL across two of its key ecosystem products, hours after it hit an ATH of $366 million:
As the crypto market continues to evolve, all eyes remain on Floki Inu and its future trajectory. Market participants eagerly await the outcome of the token burn event and closely monitor the impact of social media trends and cautionary indicators on the coin’s price.
Total crypto market cap at $2.3 trillion on the daily chart: TradingView.com
The coming days will shed more light on whether Floki Inu can sustain its current momentum or if a correction is on the horizon.
Floki Inu’s recent surge in price, driven by overwhelming community support for a token burn proposal, has captured widespread attention. The coin’s popularity on social media and positive sentiment within the cryptocurrency community further contribute to its rise.
Featured image from Pexels, chart from TradingView
Disclaimer: The article is provided for educational purposes only. It does not represent the opinions of NewsBTC on whether to buy, sell or hold any investments and naturally investing carries risks. You are advised to conduct your own research before making any investment decisions. Use information provided on this website entirely at your own risk.
Bitcoin has had an eventful few weeks in terms of price action. The world’s largest crypto is currently at a 19% increase in the past seven days and a 43% increase in the past 30 days, its highest percentage gain in over a year. As a result, a huge number of BTC addresses have been pushed into the profitability zone. For the first time in over two years, 97% of all Bitcoin addresses are now in profit.
Number Of Bitcoin Addresses In Profit Skyrockets As Prices Surge
According to crypto on-chain analytics platform IntoTheBlock, 50.62 million Bitcoin addresses are currently in profit at the current price level. This huge figure represents over 97% of the total wallet addresses. Notably, the last time holders saw this much profitability was in November 2021 when the price of Bitcoin was around $69,000, nearing its all-time high.
Notably, market playout has seen Bitcoin continue its massive gains over the past few months. Just last month, 91% of addresses were in profit. Despite some sporadic sell-offs and profit-taking from some investors attempting to break even, the percentage of addresses in profit continues to grow as the huge profitability means selling pressure no longer has a significant effect.
How Long Can Bitcoin Sustain This Upward Momentum?
Bitcoin prices have skyrocketed over the past several months, recently topping $60,000 again. The top crypto is currently trading at $62,233 at the time of this writing, and 1.28 million addresses, which account for 2.46% of the total addresses, are at a break-even point.
Notably, those who have profited the most are those who have been holding Bitcoin long-term. According to IntoTheBlock, 13.6 million Bitcoins are in the possession of investors who have held onto their assets for over a year.
However, new investors can still look forward to a continued price surge, as Bitcoin faces virtually little to no resistance in its path. Only 0.37% of addresses (193,000) are still waiting to make a profit at the current price.
Most experts remain optimistic about Bitcoin’s price potential for the rest of 2024 and beyond. With the bull run in full swing, many traders and crypto analysts think Bitcoin will continue setting new all-time highs in 2024. Price targets for the end of the year range from $100,000 up to $300,000 per Bitcoin.
Featured image from Pexels, chart from TradingView
Disclaimer: The article is provided for educational purposes only. It does not represent the opinions of NewsBTC on whether to buy, sell or hold any investments and naturally investing carries risks. You are advised to conduct your own research before making any investment decisions. Use information provided on this website entirely at your own risk.
The Commodity Futures Trading Supervisory Agency (Bappebti) of Indonesia has requested the Ministry of Finance, led by Sri Mulyani, to reassess crypto taxation.
Indonesia’s crypto taxation
Indonesia witnessed a notable downturn in its crypto tax revenue in 2023, plunging by 62% compared to the previous year, despite the surge in Bitcoin’s value.
The total tax revenue generated from crypto transactions in 2023 amounted to $31.7 million (Indonesian Rupiah 467.27 billion). This decline was primarily attributed to a significant 51% decrease in crypto transaction volumes during the same period.
The tax regime, introduced by the government in May 2022, imposed dual taxation on crypto transactions, including a 0.1% income tax and a 0.11% value-added tax (VAT), with local exchanges contributing around 0.04% to the national crypto bourse.
According to a regional report, the Commodity Futures Trading Supervisory Agency (Bappebti) has urged the Ministry of Finance, under Sri Mulyani’s leadership, to assess the implementation of crypto taxes.
Tirta Karma Senjaya, Head of CoFTRA’s (Commodity Futures Trading Authority) Market Development and Development Bureau, explained that this tax imposition aligns with crypto’s classification as a commodity or asset. With the transfer of supervision from CoFTRA to the Financial Services Authority (OJK), the Ministry of Finance, particularly the Directorate General (Dirjen) of Taxes, is expected to evaluate these crypto tax schemes.
At the 10th anniversary of the Indodax event in Jakarta on Feb. 27, stakeholders emphasized the importance of evaluating the tax regime, considering the evolving status of crypto as a significant player in the financial sector. Tirta emphasized the necessity of periodic tax reviews, stating, “Usually taxes are evaluated every year.”
Tirta further expressed his belief that the crypto industry and its regulations are relatively new, warranting space for growth until it can substantially contribute to state revenue through tax collections.
In January, Suryo Utomo, the Director General of Taxes at Indonesia’s Ministry of Finance reported a total collection of IDR 71.7 billion from crypto tax and fintech services businesses. He specified that IDR 39.13 billion ($2,492,047.15) came from crypto tax, while fintech taxes amounted to IDR 32.59 billion ($2,075,538.37).
Suryo also provided a detailed breakdown, stating that Rp. 18.25 billion ( $1,162,276.02) originated from PPh Article 22, and the remaining Rp. 20.88 billion ( $1,329,771.13) came from VAT on crypto transactions.
Throughout the preceding year, state revenue from crypto and fintech taxes totaled IDR 1.11 trillion ($70,691,856.27) with Rp. 647.52 billion ($41,238,189.88) and Rp. 437.47 billion ( $27,860,870.60) realized by the end of 2023.
Local exchanges in Indonesia have voiced concerns regarding the high tax rates, citing them as a factor in thinner revenues as users explore alternative platforms.
Suggestions have been put forward to subject crypto transactions solely to income tax, aiming to foster growth and stability in the Indonesian cryptocurrency market.
Tackling illegal crypto exchanges
In May 2023, the Blockchain Association of Indonesia uncovered a troubling discovery: the presence of 303 illicit crypto exchanges operating within the country. This revelation poses a significant threat to Indonesia’s formal tax system, as it undermines efforts to regulate and tax cryptocurrency transactions effectively.
The proliferation of unauthorized exchanges not only jeopardizes the integrity of the tax system but also raises concerns about potential revenue losses for the government.
These unregulated platforms offer users avenues to conduct crypto transactions beyond regulatory oversight, complicating tax authorities’ efforts to monitor and tax these activities accurately.
Last year, the Bali province of Indonesia implemented a ban on the use of cryptocurrencies as payment methods for foreign tourists. This measure is part of a larger initiative to reinforce the country’s official currency, the rupiah, as the sole legal tender.
The Bali Provincial Government has issued warnings, stating that severe consequences such as deportation, administrative penalties, criminal charges, closure of businesses, and other strict sanctions will be imposed on foreign tourists found violating this ban.
Trisno Nugroho, the head of Bank Indonesia’s Bali Representative Office, reiterated that while cryptocurrency trading is permissible in Indonesia, using cryptocurrencies as a form of payment is not allowed.
This prohibition on crypto payments for tourists in Bali is a component of a broader strategy to oversee and manage the utilization of cryptocurrencies throughout the nation.
BlackRock, the world’s largest asset manager, announced the iShares Bitcoin Trust ETF (IBIT39) launch in Brazil on Thursday. Starting today, Friday, March 1, shares of this index fund, which tracks the spot price of Bitcoin (BTC), will be traded on the Brazilian Commodities and Futures Exchange, known as B3.
BlackRock Launches IBIT39 Bitcoin ETF In Brazil
Karina Saade, president of BlackRock in Brazil, highlighted the company’s commitment to providing high-quality access vehicles to investors in the digital asset market. She stated:
IBIT39 is a natural progression of our efforts over many years and builds on the fundamental capabilities we have established so far in the digital asset market.
Felipe Gonçalves, Superintendent of Interest and Currency Products at B3 discussed the growth of the listed crypto market in Brazil. He noted that the market, which started in 2021, now has 13 ETFs with total assets of R$2.5 billion, or about $505 million.
While the market experienced fluctuations in its early years, it reached an eye-catching daily trading volume of R$30 million reais ($6.6 million) by the end of last year, according to local media reports in Brazil.
Gonçalves mentioned that investors in crypto ETFs include institutional investors, such as funds, and individual investors, with a current number of 170,000. Liquidity in the market is provided by non-residents investing in B3 as a whole.
IBIT39 will reportedly have a management fee of 0.25%, with a one-year waiver that reduces the fee to 0.12% once the fund reaches its first $5 billion in assets under management (AUM). The product will be made available to the general public, allowing broader participation in the Bitcoin market.
$7.5B Net Inflow In Bitcoin ETFs Since Launch In The US
BlackRock’s IBIT (iShares Bitcoin Trust) ETF has emerged as a notable player in the US ETF race, countering a significant outflow from Grayscale’s Bitcoin Trust (GBTC).
BitMEX research data shows that on February 29, 2024, positive flows amounted to $92 million for the day. Notably, BlackRock and GBTC offset each other, experiencing $600 million in opposite directions. The data shows that since the ETFs began trading on January 11, 2024, there has been an impressive net inflow of $7.5 billion.
The overall holdings of spot funds, which directly hold Bitcoin, stood at 776,464 BTC (equivalent to $47.7 billion) on Friday morning, according to BitMEX Research. It’s essential to consider that the total BTC supply currently in circulation is 19.64 million, with a maximum limit of 21 million.
With this context, the fact that the ETFs have secured 4% of the total BTC supply is a significant milestone. It demonstrates the growing demand for Bitcoin among investors utilizing these index funds to gain exposure to the cryptocurrency.
BTC continues to consolidate above the $62,000 mark, rising 1.3% in the past 24 hours.
Featured image from Shutterstock, chart from TradingView.com
Disclaimer: The article is provided for educational purposes only. It does not represent the opinions of NewsBTC on whether to buy, sell or hold any investments and naturally investing carries risks. You are advised to conduct your own research before making any investment decisions. Use information provided on this website entirely at your own risk.
As Bitcoin surges toward its previous all-time high, industry experts are anticipating a correction before the digital asset can continue its upward trajectory.
Mike Novogratz, founder of Galaxy Digital, shared his insights with Bloomberg TV, suggesting that while Bitcoin has soared past the $60,000 mark this week, a correction is likely imminent.
Bitcoin Enters “Price Discovery” Phase
“I wouldn’t be surprised to see some correction and some consolidation, but I’m very loath to pick a Bitcoin high because I really do believe this is price discovery,” stated Novogratz, highlighting the ongoing exploration of BTC’s true value.
He elaborated that a correction could see Bitcoin fall to the mid-$50,000s before experiencing another surge to set a new high. The recent price surge, fueled by the approval of spot BTC ETFs in the U.S., has propelled Bitcoin into a “price discovery” phase, attracting new investors.
Novogratz cautioned that the market has become overly frothy, with retail investors leveraging their positions to an unsustainable extent. He warned that many investors, particularly millennials and Gen Z traders, could face losses in such a volatile environment.
Despite short-term fluctuations, Novogratz remains bullish on Bitcoin’s long-term prospects, pointing to the potential influx of baby boomer wealth into the cryptocurrency market.
With baby boomers accounting for approximately $85 trillion in wealth, a small shift of 1% to 3% of their investments into Bitcoin could significantly boost the value of the digital asset.
“3% of that is two and a half trillion. The whole market cap of Bitcoin is only a little more than 1.2 trillion,” he said.
Caution Amidst Bullish Surge
The recent rally saw Bitcoin reaching highs not seen in over two years, briefly touching $64,000. Bitcoin’s price is currently at $61,500, according to CoinGecko data.
This rally has sparked comparisons to Bitcoin’s prior all-time peak of almost $69,000 in November 2021, causing certain investors to speculate that it might signify the onset of a fresh bull market for cryptocurrencies.
However, co-founder of Matrixport, Daniel Yan, recently urged caution amidst the bullish sentiment. Yan warned about being overly optimistic, pointing out that overly enthusiastic market sentiment and uncertain macroeconomic factors could increase volatility.
Euphoria: the sentiment of the market has come to a level where I think we should be cautious – may be a good idea to revisit my pinned tweet on the size of potential corrections. I think we should see another healthy ~15% correction by end-April.
Leading U.S. investment platforms Meryll Lynch and Wells Fargo are now offering clients access to Bitcoin spot ETFs despite initially hesitating on the move.
As reported by Bloomberg, the firms are offering the ETFs to certain wealth management clients who specifically request the product, which allows clients to directly invest in BTC through an ETF wrapper.
Merrill Lynch Embraces Bitcoin
Last month, Merrill Lynch, the investment management division of Bank of America, was one of U.S. financial giants to receive major rebuke for its initial refusal to allow customer access to the ETFs after their historic launch last month.
At the time, Fox Business reported that Merrill Lynch was waiting to see whether the ETFs could trade efficiently before changing their internal policy, which did not allow for such products.
By all measures, the ETFs have had a massively successful launch. Since approval, shares for funds like the Grayscale Bitcoin Trust (GBTC) now trade at perfect parity with their underlying BTC value after years of trading at a discount.
The ETFs have also drawn massive trading volume, collectively processing a record-breaking $7.7 billion in trades on Wednesday, alongside a record $673 million in net flows. BlackRock and Fidelity’s Bitcoin ETFs proved to be the two most successful ETF launches in history after thirty days.
Given their proven demand, multiple analysts suspected that major wirehouses would likely hurry to offer the products to clients for fear of missing out.
“I’m sure pressure is mounting for them,” wrote Bloomberg ETF analyst Eric Balchunas to X on Wednesday. “They like to see [a] track record and get paid off, but with grassroots demand like this they [are] gonna have to expedite.”
Meanwhile, Bitwise CIO Matt Hougan believes the ETFs are still awaiting a wave of demand from investment platforms that haven’t offered them to clients yet.
“I think there’s an even bigger wave coming in a few months as we start to see the major wirehouses turn on… but this has been Bitcoin’s IPO moment,” he told CNBC on Thursday.
Vanguard Still Opposed to Bitcoin
While Merrill welcomes the ETFs, Vanguard – the world’s second-largest asset manager after BlackRock – still won’t let clients buy the asset through its platform, citing a difference in investment philosophies.
The firm is still a major investor in MicroStrategy and several major Bitcoin mining firms, however.
On Thursday, Vanguard CEO Tim Buckley stepped down from his role after a 33-year run.
SPECIAL OFFER (Sponsored)
Binance Free $100 (Exclusive): Use this link to register and receive $100 free and 10% off fees on Binance Futures first month (terms).
In a comprehensive analysis shared via X (formerly Twitter), Alex Thorn, the Head of Firmwide Research at Galaxy, delved into the intricacies of the current Bitcoin market cycle, answering the question “Where Are We In This Bitcoin Cycle?” As Bitcoin trades robustly around $62,000, with a notable spike to $64.000 yesterday, the crypto landscape is witnessing unprecedented dynamics, marked by a surge in ETF inflows, strategic acquisitions by corporate entities, and a palpable shift in investor sentiment towards digital assets.
Thorn emphasized how different this cycle is:
Effectively, the bull runs of 2017 and 2020 hadn’t yet begun at this stage in Bitcoin’s supply schedule.
52 days before 2nd Halving (9-JUL-16) BTCUSD $455.22 (-59.86% from ATH) 52 days before 3rd Halving (11-MAY-20) BTCUSD $6,174 (-68.56% from ATH) 52 days before 4th Halving (20-APR-24) BTCUSD $59,330 (-12.16% from ATH)
Why This Bitcoin Cycle Is Different
Central to his analysis is the record-breaking influx of capital into spot Bitcoin ETFs, with Thorn highlighting, “The BTC ETFs took in a whopping net $576m of BTC yesterday (Tuesday Feb. 27), with BlackRock alone seeing $520m of inflows, its largest ever day.” This significant movement of funds not only underscores the growing institutional interest in Bitcoin but also marks a pivotal moment in the cryptocurrency’s journey towards mainstream financial recognition.
A key aspect of Thorn’s analysis is the unwavering strength of Bitcoin’s long-term holder base, which he estimates to hold about 75% of the total BTC supply. “Long-term holders are still mostly holding strong,” Thorn notes, emphasizing the community’s resilience and faith in Bitcoin’s long-term value proposition. This demographic, characterized by their ‘diamond hands’, plays a crucial role in stabilizing the market and buffering against the volatility that often defines the crypto space.
Bitcoin: % of supply held by HODLers | Source: X @intangiblecoins
Thorn further elaborates on the analytical tools and metrics that provide insight into Bitcoin’s market behavior. He introduces the MVRV Z-Score, a novel approach to understanding the cyclicality of Bitcoin’s price action by comparing its market value to its realized value. This metric offers a window into the perceived overvaluation or undervaluation of Bitcoin at any given point. Currently, the MVRV Z-Score is close to 2, while previous cycle tops saw the metric spike to 8 (in 2021) or even above 12 (in prior halving cycles).
Bitcoin MVRV Z-Score | Source: X @intangiblecoins
Addressing the speculation around the acceleration of the Bitcoin cycle, Thorn firmly dispels concerns that the market is prematurely peaking. He argues against the notion that we are “speedrunning the ‘cycle’”, instead asserting that the advent of Bitcoin ETFs in the United States represents a transformative shift with far-reaching implications. “This time is different,” Thorn asserts, pointing to the ETFs’ disruption of traditional Bitcoin price cycles and their impact on investor behavior and intra-crypto dynamics.
The Spot Bitcoin ETF Effect
Thorn underscored the transformative impact of Bitcoin ETFs, positing that we are merely at the beginning of a significant shift in how Bitcoin is accessed and invested in, particularly by the institutional sector. “Despite incredible volumes and flows, there’s plenty of reason to believe that the Bitcoin ETF story is still just getting started,” he stated, pointing to the untapped potential within the wealth management sector.
In their October 2023 report titled “Sizing the Market for the Bitcoin ETF,” Galaxy laid out a compelling case for the future growth of Bitcoin ETFs. The report highlights that wealth managers and financial advisors represent the primary net new accessible market for these vehicles, offering a previously unavailable avenue for allocating client capital to BTC exposure.
The magnitude of this untapped market is substantial. According to Galaxy’s research, there is approximately $40 trillion of assets under management (AUM) across banks and broker/dealers that has yet to activate access to spot BTC ETFs. This includes $27.1 trillion managed by broker-dealers, $11.9 trillion by banks, and $9.3 trillion by registered investment advisors, cumulating to a total US Wealth Management AUM of $48.3 trillion as of October 2023. This data underscores the vast potential for Bitcoin ETFs to penetrate deeper into the financial ecosystem, catalyzing a new wave of investment flows into Bitcoin.
Thorn further speculated on the upcoming April round of post-ETF-launch 13F filings, suggesting that these filings might reveal significant Bitcoin allocations by some of the largest names in the investment world. “In April, we will also get the first round of post-ETF-launch 13F filings, and (I’m just guessing here…) we are likely to see some huge names have allocated to Bitcoin,” Thorn anticipated. This development, he argues, could create a feedback loop where new platforms and investments drive higher prices, which in turn attracts more investment.
The implications of this feedback loop are profound. As more wealth management platforms begin to offer access to Bitcoin ETFs, the influx of new capital could significantly impact BTC’s price dynamics, liquidity, and overall market structure. This transition represents a key moment in the maturation of Bitcoin as an asset class, moving from a speculative investment to a staple in diversified portfolios managed by financial advisors and wealth managers.
We Are Still Early
Thorn’s optimism extends beyond the immediate market indicators to the broader implications of Bitcoin’s integration into the financial mainstream. He anticipates a new all-time high for Bitcoin in the near term, fueled by a combination of factors including the ETFs’ momentum, increasing acceptance of BTC as a legitimate asset class, and the anticipatory buzz surrounding the upcoming halving event. “All this is to say, my answer to that burning question – where are we in the cycle? – is that we haven’t even begun to reach the heights this is likely to go,” he concludes.
Thorn’s analysis culminates in a bullish forecast for Bitcoin. As the community stands on the cusp of the fourth BTC halving, Thorn’s insights offer a compelling vision of a market poised for unprecedented growth, driven by a confluence of technological innovation, regulatory evolution, and shifting global economic currents. “Bitcoin is prime time now, and while it might be hard to believe, things are just starting to get exciting,” Thorn declares, capturing the essence of a market at the threshold of a new era.
Featured image created with DALL·E, chart from TradingView.com
Disclaimer: The article is provided for educational purposes only. It does not represent the opinions of NewsBTC on whether to buy, sell or hold any investments and naturally investing carries risks. You are advised to conduct your own research before making any investment decisions. Use information provided on this website entirely at your own risk.
BANGKOK — Shares were mixed in Asia on Thursday after a lackluster day on Wall Street, where selling of technology stocks pulled benchmarks lower.
U.S. futures were flat and oil prices also were barely changed.
Tokyo’s Nikkei 225 index was down 0.1% at 39,166.19 after data showed factory output falling in January at the fastest pace since May 2020, although retail sales were stronger than expected.
Hong Kong’s Hang Seng added 0.4% to 16,604.18 and the Shanghai Composite index jumped 1.9% to 3,012.68. The smaller index in Shenzhen was up 3.4% after regulators released new measures to support markets including closer oversight of financial derivatives.
But technology services company Baidu was down 6.9% after reporting its profit fell 48% in the October-December quarter due to higher spending as it strives to keep up with rivals in the artificial intelligence field.
South Korea’s Kospi slipped 0.4% to 2,642.36 while the S&P/ASX 200 gained 0.5% to 7,698.70. Bangkok’s SET lost 0.4% and the Sensex in India was up 0.1%.
On Wednesday, the S&P 500 slipped 0.2%, to 5,069.76, continuing its quiet and listless run since setting a record last week. The Dow Jones Industrial Average dipped 0.1% to 38,949.02. The Nasdaq composite sank 0.5%, to 15,947.74, a day after pulling within 0.1% of its record set in 2021.
Treasury yields also eased in the bond market after a report said the U.S. economy likely grew a touch slower in late 2023 than earlier estimated. The economy continues to defy expectations of a recession despite high interest rates meant to bring down inflation.
A 1.3% drop for Nvidia and 1.8% slump for Google’s parent company, Alphabet, were two of the heaviest weights on the market. They’re among a small group of Big Tech stocks that have been disproportionately responsible for the S&P 500’s run to records.
Such concentration in the market can be a concerning signal, according to Scott Wren, senior global market strategist at Wells Fargo Investment Institute. Broad gains among a wide variety of stocks are typically a more favorable sign that the market’s strength is sustainable.
Bumble tumbled 14.8% after it reported weaker results for the latest quarter than analysts expected. The dating and friend-making app company, which recently revamped its leadership team, also gave a forecast for revenue this upcoming year that fell short of analysts’ expectations.
Boston Beer, the company behind Samuel Adams, slid 15.8% after reporting a larger loss than analysts expected. It was hurt by declines for its Truly hard seltzer.
Urban Outfitters dropped 12.8% after the retailer reported weaker results than expected. The company, which also runs Anthropologie stores, said sales are continuing to weaken at its Urban Outfitters locations.
Helping to limit the market’s losses was eBay, which rose 7.9% after reporting stronger results than analysts expected. Axon Enterprise, the company that sells Tasers, body cameras and other equipment, also turned in a better-than-expected profit report, and its stock jumped 13.8%.
Coinbase gained 0.8% after rising more earlier in the day to continue its strong run as bitcoin’s price keeps rallying. New exchange-traded funds that make investing in bitcoin easier have raised interest in the cryptocurrency, with BlackRock’s iShares Bitcoin fund alone quickly growing to $7 billion in assets.
Bitcoin’s price briefly topped $64,000 Wednesday for the first time since 2021. It’s pulling closer to its record of nearly $69,000 after rising more than 40% so far this year.
Coinbase’s CEO, Brian Armstrong, apologized to customers during the day for issues they encountered because the company was “dealing with a LARGE surge of traffic” as bitcoin’s price soared. The company said some users may have seen a zero balance across their accounts and had errors in buying and selling.
Beyond Meat surged 30.7% even though it reported much weaker results for the latest quarter than expected. Its revenue was slightly better than forecast after falling less than expected, and it said its profitability will likely increase through 2024.
In other trading Thursday, U.S. benchmark crude oil gained 2 cents to $78.56 per barrel in electronic trading on the New York Mercantile Exchange.
Brent crude, the international standard, was up 1 cent at $82.16 per barrel.
The U.S. dollar fell to 149.78 Japanese yen from 150.69 yen. The euro rose to $1.0836 from $1.0834.
In a post on X, one analyst observes that the altcoin market capitalization has broken from the Wyckoff accumulation phase. With this upswing, the trader expects altcoin prices to move higher.
This refreshing breakout coincides with Bitcoin’s (BTC) stellar performance when writing on February 28. At spot rates, the coin is trading above $60,000, a psychological round number- now supported- and is closely approaching $70,000.
The Altcoin Breakout From Accumulation
The “Wyckoff accumulation pattern” is a concept developed by technical analysts to pick out potential buying opportunities, in this case, altcoins. Whenever prices are in this phase, it is widely believed that the so-called “smart money” or large institutional players are accumulating at low prices.
Altcoin market cap breaking out | Source: Analyst on X
Currently, prices consolidate at tight ranges and with low trading volumes. A signal marking the end of this accumulation is a sharp breakout, lifting prices above the defined range. Often, this upswing is with rising trading volume.
Looking at the chart, the altcoin market cap has broken above the accumulation phase. With previous resistance and support, the altcoin market cap will likely continue floating higher. As such, top altcoins, including Ethereum (ETH), Solana (SOL), and XRP, will follow suit, posting fresh 2024 highs.
Why Spot Bitcoin ETFs Give BTC Edge In This Bull Run
So far, Bitcoin is leading the way, posting over $10,000 in less than a week. However, with the coin trading above $60,000, its demand-side drivers differ entirely from what’s influencing altcoins. The approval of spot Bitcoin exchange-traded funds (ETFs) by the United States Securities and Exchange Commission (SEC) has seen billions of dollars flow to the world’s first cryptocurrency.
Therefore, while altcoins have historically outperformed BTC when crypto prices rally, there is an edge with spot Bitcoin ETFs. As such, this bull run will likely differ from 2017 and 2021. This forecast is because institutions will likely favor a regulated asset over altcoins whose status remains undefined.
As of late February 2024, the United States SEC has not approved spot ETFs of any altcoin, including that of Ethereum. Additionally, the agency has labeled several top altcoins, including Cardano (ADA), unregistered securities. The agency even filed lawsuits against major exchanges like Binance and Coinbase, accusing them of facilitating the trading of what the commission described as “unregistered securities.”
It is not immediately clear whether the United States SEC will change their preview of leading altcoins, especially Ethereum (ETH), which has a market of over $400 billion. Wall Street heavyweights like BlackRock and Fidelity remain interested in launching spot Ethereum ETFs.
Feature image from DALLE, chart from TradingView
Disclaimer: The article is provided for educational purposes only. It does not represent the opinions of NewsBTC on whether to buy, sell or hold any investments and naturally investing carries risks. You are advised to conduct your own research before making any investment decisions. Use information provided on this website entirely at your own risk.
As Bitcoin’s price grazed the $64,000 milestone on Feb. 28, market indicators indicate an imminent rally to new all-time highs above $70,000.
Bitcoin (BTC) grabbed headlines again on Feb. 28, as prices surged to a daily timeframe peak of $64,000, its highest in 830 days. With whale investment metrics still flashing green signals, a new all-time high could be on the cards for the pioneer cryptocurrency.
Bitcoin whales in firm control: Holding 60% of the total supply
The Bitcoin ETF approval was undoubtedly a real watershed moment for the crypto sector. At press time on Feb. 28, the overall market capitalization of the crypto industry has skyrocketed by $450 billion to reach a three-year peak of $2.25 trillion.
The boom in the crypto sector inflows was led by record-breaking demand by 10 newly-launched Bitcoin ETFs, who have jointly acquired over 665,850 BTC, around $40 billion, in less than six weeks of trading.
However, a closer look at the on-chain data shows that aside from the ETF holdings, a broader range of large corporate entities and high net-worth investors have plunged headfirst into the BTC market. The air of legitimacy provided by the U.S. Securities and Exchange Commission’s (SEC) approval verdict has been pivotal to this trend.
Bitcoin (BTC) Whales Balances Trend vs. Price | Source: Santiment
The Santiment chart presents the historical trend of Bitcoin balances held in whale wallets with a minimum of 100 BTC, roughly $600,000. The chart shows that between May 2022 and January 2023, whales rapidly offloaded 500,000 BTC from their holdings.
That period coincided with the TerraUST collapse and the FTX crash of 2022, which reflected severe cases of corporate governance and internal control failure.
Since then, whales have begun repurchasing BTC after the SEC confirmed official Bitcoin filings by BlackRock around September 2023.
In addition to the SEC’s tacit co-sign, the resilience shown by entities like MicroStrategy and sovereign governments seen in El Salvador and the Central African Republic in recent years has also shored up corporate confidence in Bitcoin.
At the time of writing on Feb. 28, the whales now hold 11.7 million BTC worth approximately $714 billion, which accounts for 60% of the total supply currently in circulation, the highest in over two years.
Large institutional investors are known to have a longer-time investment horizon than short-term retail swing traders. Their tendency to accumulate and retain large amounts of BTC effectively reduces the available supply in the market, creating scarcity and exerting upward pressure on prices.
Hence, by controlling a significant share of the market supply, the resurgent Bitcoin whales will likely drive Bitcoin price toward an all-time high above $70,000 in the coming weeks.
Price forecast: Can Bitcoin reach $70,000 in March 2024?
At the time of writing on Feb. 28, BTC is currently trading at $59,141. If the Bitcoin whales’ buying trend persists in March 2024, the BTC price rally will likely advance toward $70,000.
However, the historical accumulation trend shows that BTC faces stiff resistance around the $62,400 area.
IntoTheBlock’s in/out of the money data shows that 326,790 addresses had acquired 94,990 BTC at the maximum price of $62,424. Since those investors have been holding a loss since November 2021, many could exit as BTC’s price breaks even.
If the bulls can surmount that sell-wall, it could generate stronger bullish momentum for a new all-time high above $70,000 as predicted.
Alternatively, bears could seize control of the markets if they force a sharp downswing below $55,000. But currently, this seems a tall order considering the looming support buy-wall mounted at $57,360 territory.
Coinbase apps are “recovering” after some customers opened their digital accounts to find them showing zero balances, CEO Brian Armstrong said Wednesday afternoon.
The cryptocurrency exchange acknowledged the issue earlier Wednesday after users reported difficulties making trades and that their accounts were empty.
“Apps are now recovering,” Armstrong said on X (formerly known as Twitter). “We had modeled a ~10x surge in traffic and load tested it. This exceeded that number.”
He added that it’s “expensive” to keep the company’s services “over-provisioned,” meaning overloading an app to test its capacity and make sure it can handle surges in traffic.
The company had posted about the issue earlier in the day.
“We are aware that some users may see a zero balance across their Coinbase accounts & may experience errors in buying or selling. Our team is investigating this & will provide an update shortly. Your assets are safe,” the company said on X.
We are aware that some users may see a zero balance across their Coinbase accounts & may experience errors in buying or selling. Our team is investigating this & will provide an update shortly. Your assets are safe. You can track this incident at https://t.co/a3pl4WiDhZ
Coinbase included a link to its website where customers can track the status of the incident.
“We’re beginning to see improvement in customer trading,” the company said in an update on its site. “Due to increased traffic, some customers may still see errors in login, sends, receives and with some payment methods. Rest assured your funds are safe.”
On social media, some cryptocurrency traders who use Coinbase said the glitch has eroded their trust in the platform. One user pointed out that the errors were occurring at “a key time in the market,” given that bitcoin prices have surged in recent days and topped $60,000 on Thursday.
Megan Cerullo is a New York-based reporter for CBS MoneyWatch covering small business, workplace, health care, consumer spending and personal finance topics. She regularly appears on CBS News Streaming to discuss her reporting.
Thanks for reading CBS NEWS.
Create your free account or log in for more features.
Bitcoin price rallied further toward $58,000. BTC is now consolidating gains and might soon attempt more gains toward the $60,000 resistance.
Bitcoin price is consolidating gains below the $57,500 resistance zone.
The price is trading above $56,000 and the 100 hourly Simple moving average.
There is a rising channel forming with resistance near $57,650 on the hourly chart of the BTC/USD pair (data feed from Kraken).
The pair could extend its current rally toward the $60,000 resistance zone.
Bitcoin Price Faces Fresh Hurdle
Bitcoin price extended its rally above the $55,000 resistance zone. BTC gained bullish momentum after it broke the $55,500 and $56,000 resistance levels. There was also a spike above the $57,000 resistance zone.
A new multi-week high is formed near $57,572 and the price is now consolidating gains. There was a minor decline below the $57,000 level, but the price is still above the 23.6% Fib retracement level of the recent wave from the $50,950 swing low to the $57,572 high.
Bitcoin is now trading above $56,000 and the 100 hourly Simple moving average. Immediate resistance is near the $57,200 level. The next key resistance could be $57,500.
There is also a rising channel forming with resistance near $57,650 on the hourly chart of the BTC/USD pair, above which the price could rise toward the $58,000 resistance zone. If the bulls remain in action, the price could even surpass $58,000 and test $58,800. The main hurdle for them is visible near the $60,000 zone.
Are Dips Supported In BTC?
If Bitcoin fails to rise above the $57,500 resistance zone, it could start a downside correction. Immediate support on the downside is near the $56,800 level.
The first major support is $56,000. If there is a close below $56,000, the price could start a decent pullback toward the 50% Fib retracement level of the recent wave from the $50,950 swing low to the $57,572 high at $54,250. Any more losses might send the price toward the $53,200 support zone.
Technical indicators:
Hourly MACD – The MACD is now losing pace in the bullish zone.
Hourly RSI (Relative Strength Index) – The RSI for BTC/USD is now above the 50 level.
Major Support Levels – $56,800, followed by $56,000.
Major Resistance Levels – $57,500, $57,650, and $58,000.
Disclaimer: The article is provided for educational purposes only. It does not represent the opinions of NewsBTC on whether to buy, sell or hold any investments and naturally investing carries risks. You are advised to conduct your own research before making any investment decisions. Use information provided on this website entirely at your own risk.
Today, Jack Mallers, the CEO of Strike, has announced the expansion of Strike’s suite of Bitcoin services into several African markets.
Strike Africa will now be available in Gabon, Ivory Coast, Malawi, Nigeria, South Africa, Uganda, and Zambia, with plans for further expansion in the future. With this expansion, Strike aims to address the unique financial challenges faced by many African countries, including high inflation rates, devaluing currencies, and expensive remittance services.
“Strike Africa is just the beginning,” said Mallers. “Our commitment to Bitcoin has never been stronger and we will continue to launch new regions all throughout 2024.”
Through Strike Africa, users will have access to a comprehensive range of Bitcoin and Lightning services, including local fiat on and off-ramps, the ability to buy and sell Bitcoin and USDT, cross-border payments, and more. With these offerings, Strike aims to empower individuals and businesses with fast, secure, and cost-effective financial solutions.
Jack Mallers emphasized the importance of Bitcoin as a digital reserve asset and hedge against inflation in African countries experiencing economic turmoil. He highlighted the significant impact that Strike’s services can have in providing individuals with the tools to protect their property rights and preserve wealth.
Furthermore, Strike Africa will enable businesses to open accounts and access a range of services tailored to their needs. The availability of Strike’s API hopes to empower developers to build innovative Bitcoin and payment tools for customers in Africa and beyond.
Additionally, Strike Private will provide eligible clients with personalized services, including custom pricing, Bitcoin education, market analysis, and more. This tailored approach is for supporting clients on their Bitcoin journey and provide them with expert guidance and assistance.
Reports have revealed that institutional investors are shifting their focus to Ethereum, displaying a preference compared to the largest cryptocurrency, Bitcoin. Despite Bitcoin’s recent rally to over $55,000, Ethereum’s unique features and potential developmental capabilities continue to capture institutional players’ interest.
Institutions Favor Ethereum Over Bitcoin
On February 24, cryptocurrency exchange, Bybit, published a research report on its users’ asset allocation. The research examined investors’ hodling and trading behaviours, covering the period from July 2023 to January 2024. Bybit’s report also provided valuable insights into investors’ asset allocation across cryptocurrencies such as altcoins, stablecoins and meme coins, shedding light on the specific coins users are currently bullish or bearish on.
According to the research report, Ethereum has unexpectedly emerged as the primary cryptocurrency choice for institutional investors. The report revealed that “institutions are betting big on Ethereum,” allocating more of their funds to ETH compared to BTC.
Bybit has disclosed that the recent rise in interest in Ethereum began in September 2023, when ETH was still trading around $2,000. Subsequently, Ethereum’s market sentiment became more bullish, experiencing a surge in investor interest to about 40% by January 2024. The crypto exchange has confirmed that, as of January 31, ETH has become the single largest cryptocurrency held by institutions.
Bybit’s report also revealed that institutional investors’ interest in Bitcoin began to wane following the United States Securities and Exchange Commission (SEC) approval of Spot Bitcoin ETFs on January 10, 2024. At the time, Bitcoin had experienced massive selling pressures, resulting in investors trimming their BTC holdings to favour other cryptocurrencies.
The excessive allocation of Ethereum is reportedly attributed to investors anticipating a favourable outcome from Ethereum’s upcoming Decun Upgrade, slated to launch in March 2024.
Notably, Bybit has disclosed that it is still being determined if the recent shift to Ethereum is a short-term manoeuvre or a more prolonged move. However, the approaching Bitcoin halving in April potentially adds a layer of bearish risks, as projections indicate Bitcoin’s significant rise in value to new all-time highs during the halving phase.
Bybit’s research report also examines the asset allocation trend for retail investors on the cryptocurrency exchange. The report revealed that retail investors are significantly more bullish on Bitcoin than Ethereum, allocating more funds into BTC than ETH despite Ethereum’s recent surge in value.
Over the past week, Ethereum has experienced a substantial hike in its price, jumping over 7% and outpacing Bitcoin, suggesting a potential for a more extensive upward trajectory. At the time of writing, Ethereum is trading at $3,227, reflecting a 4.05% increase in the last 24 hours, according to CoinMarketCap.
While Ethereum’s massive rally has successfully elevated the sentiment among institutional investors, retail investors remain less swayed, opting to hold onto or incorporate additional Bitcoin into their diversified portfolio of digital assets.
Featured image from Cointribune, chart from Tradingview.com
Disclaimer: The article is provided for educational purposes only. It does not represent the opinions of NewsBTC on whether to buy, sell or hold any investments and naturally investing carries risks. You are advised to conduct your own research before making any investment decisions. Use information provided on this website entirely at your own risk.
Solana-based investment products had seen steady inflows throughout the year after intensive performance and reliability improvements.
However, investor confidence took a hit due to a network outage lasting five hours earlier this month, caused by a bug that caused transactions to enter an infinite loop, thereby impacting the network’s functionality.
Solana’s Troubles Continue
Among altcoins, only investment products tied to Solana experienced outflows, which surged to $3 million in the past week. This latest figure nearly doubles the amount from the previous week, when Solana saw $1.6 million in outflows.
Its rival, Ethereum, on the other hand, saw inflows of $17 million.
During the same period, other altcoins, such as Chainlink and XRP, also attracted $1.8 million and $1.1 million inflows, respectively. Investment products based on Cardano and Litecoin settled with inflows of $0.4 million and $1 million, respectively.
According to CoinShares’ latest edition of Digital Asset Fund Flows Weekly Report, Bitcoin experienced inflows of $570 million last week, pushing its year-to-date inflows to $5.6 billion. However, recent price increases prompted minor inflows into short-bitcoin positions, totaling $3.9 million.
Investment products focused on digital assets saw weekly inflows reaching $598 million, according to CoinShares. This marked the fourth straight week of such inflows. As a result, the year-to-date inflows have exceeded $5.7 billion, constituting 55% of the record inflows observed in 2021.
Earlier this week, the total assets under management (AuM) reached a peak of $68.3 billion, the highest since December 2021, though still below the all-time high of $87 billion recorded in November 2021.
Meanwhile, blockchain equities had a subpar week, experiencing outflows amounting to $81 million, suggesting a degree of caution among equity investors currently.
US Dominates Investment Inflows
In terms of regions, the spotlight remains on the US, where the majority of inflows totaled $610 million, influenced by incumbent issuer Grayscale, which witnessed additional outflows amounting to $436 million last week.
Brazil and Switzerland experienced minor inflows of $8.2 million and $2.1 million, respectively, while both Canada and Sweden saw outflows totaling $18 million and $8 million, respectively. Germany also noted a minor outflow of $0.3 million.
SPECIAL OFFER (Sponsored)
Binance Free $100 (Exclusive): Use this link to register and receive $100 free and 10% off fees on Binance Futures first month (terms).
Proof of Work blockchains stand as the cornerstone of cryptocurrency technology, first popularized by Bitcoin, the original cryptocurrency. At their core, these blockchains rely on a consensus mechanism called Proof of Work (PoW). This mechanism is essential for validating transactions and creating new blocks without the need for a central authority.
In a PoW blockchain, miners compete to solve complex mathematical puzzles. The first miner to solve the puzzle gets the opportunity to add a new block to the blockchain and is rewarded with cryptocurrency. This process not only secures the network against fraudulent transactions but also ensures its decentralization and integrity.
The ingenuity of Proof of Work lies in its simplicity and effectiveness. It leverages computational power to maintain network security, making any attempt to alter transaction data not just difficult, but economically not feasible. As the pioneer of this technology, Bitcoin has demonstrated the robustness and reliability of PoW blockchains, setting a benchmark for countless cryptocurrencies that followed.
Understanding Proof Of Work Blockchains
Proof of Work (PoW) blockchains are foundational to the cryptocurrency ecosystem, embodying a consensus mechanism that is both secure and decentralized. This innovative approach to consensus ensures the integrity, security, and continuity of the blockchain without necessitating a central authority.
What Makes A Proof Of Work Blockchain?
A Proof of Work (PoW) blockchain is distinguished by its consensus mechanism, which is intricately designed to ensure network security, decentralization, and transaction integrity through computational effort. This mechanism revolves around several pivotal elements that together define the PoW paradigm:
Cryptographic Puzzle Solving (Hashing): At the heart of PoW is the requirement for miners to solve complex cryptographic puzzles. These puzzles involve calculating a hash—a fixed-size alphanumeric string—that meets specific criteria set by the blockchain network.
Adjustable Difficulty Target: The PoW algorithm adjusts the difficulty of the cryptographic puzzle to maintain a constant block time, despite fluctuations in the network’s total hashing power. This dynamic adjustment ensures consistent block creation rates, which are crucial for the stability and predictability of the blockchain.
Network Security Through Work: The foundational principle behind PoW is that the security of the blockchain is directly proportional to the amount of work (computational power) invested in it. Successfully solving a puzzle requires a significant investment in hardware and electricity, making it economically impractical to conduct attacks.
Decentralization And Participation: PoW encourages a decentralized network structure by allowing anyone with the necessary computational resources to participate in mining. This openness fosters a competitive mining environment and reduces the risk of centralized control, which is pivotal for the autonomy and resilience of the blockchain.
Miner Incentivization: Miners are rewarded for their efforts with a combination of block rewards (newly minted coins) and transaction fees.
Immutability And Trust: The PoW consensus model underpins the blockchain’s immutability. Altering any previously confirmed block would require re-mining not only that block but also all subsequent blocks, a feat that demands an unrealistic amount of computational power.
Advantages Of Proof Of Work Blockchains
The implementation of PoW consensus mechanisms brings forth several advantages that are critical to the functionality and security of blockchain technology:
Robust Security Model: The sheer computational work required to validate transactions and mine new blocks makes PoW blockchains incredibly secure. This security model effectively prevents the feasibility of 51% attacks, where an entity would need to control the majority of the network’s hashing power to manipulate the blockchain.
Immutable Ledger: PoW contributes to the immutability of the blockchain, ensuring that once a transaction is confirmed and added to the ledger, reversing it becomes computationally infeasible. This property is vital for trust and reliability in the system.
Network Integrity: Through the process of mining and the rewards system, PoW blockchains encourage participants to act honestly. The cost of attempting to cheat the system (in terms of wasted computational power and energy) outweighs the potential benefits, thereby maintaining the integrity of the network.
Transparent And Verifiable: All transactions on a PoW blockchain are transparent and can be independently verified by any participant. This transparency builds trust among users and is fundamental for the operation of a decentralized financial system.
Top 10 Proof of Work Blockchains Like Bitcoin
Below is a list of the top 10 Proof of Work (PoW) blockchains by market cap (as of February 2024):
Bitcoin: The Pioneer Proof Of Work Blockchain
Bitcoin stands as the original and most renowned Proof of Work blockchain. Launched by an anonymous entity or group under the pseudonym Satoshi Nakamoto in 2009, Bitcoin introduced the world to the concept of decentralized digital currency. At its core, Bitcoin operates on a PoW consensus mechanism, which is fundamental to its design for securing transactions and minting new coins.
Bitcoin: Proof Of Work Blockchain | Source. iStock
Technical Innovation:
Bitcoin’s introduction of blockchain technology represented a revolutionary leap forward in digital trust. By enabling a decentralized network of miners to validate transactions by solving complex cryptographic puzzles, Bitcoin solved the double-spending problem without the need for a central authority.
Security:
The security of the Bitcoin network is unparalleled, largely due to the massive amount of computational power contributed by miners around the globe. This distributed network of miners makes it nearly impossible for any single actor to manipulate the blockchain or reverse transactions, ensuring the integrity and trustworthiness of the entire system. The latest study by Lucas Nuzzi, Head of R&D at CoinMetric, showed that a 51% attack would cost at least $20 billion and is logistically near impossible.
Impact on Cryptocurrency:
Bitcoin not only pioneered the PoW mechanism but also laid the groundwork for the cryptocurrency industry. Its success has inspired the creation of thousands of alternative cryptocurrencies, many of which have adopted or adapted its PoW model. Bitcoin remains the gold standard in the space, often referred to as “digital gold,” symbolizing its status as a store of value and a hedge against traditional financial systems.
Network and Adoption:
Over the years, Bitcoin has seen exponential growth in both adoption and value. It has transitioned from a niche digital currency to a mainstream financial asset recognized by individuals, corporations, and even some governments. The network continues to grow, supported by a robust and dedicated community of developers, miners, and enthusiasts who ensure its ongoing development and security.
Dogecoin: From Meme To Mainstream
Dogecoin, originally created as a lighthearted joke in 2013, has evolved from a meme-inspired cryptocurrency to a significant player within the Proof of Work (PoW) blockchain ecosystem. Designed by Billy Markus and Jackson Palmer, Dogecoin was intended to mock the wild speculation of the cryptocurrency market. However, its fun and friendly approach led to a vibrant and supportive community, propelling Dogecoin from a humorous experiment to mainstream relevance.
Dogecoin Proof Of Work | Source: iStock
Community and Culture:
At the heart of Dogecoin’s unexpected rise to fame is its strong, welcoming community. Unlike other cryptocurrencies that focus on technical aspects or financial gains, Dogecoin emphasizes camaraderie and charitable endeavors. This unique culture has fostered a loyal following, contributing to its resilience and growth.
Technical Foundation:
Despite its whimsical origins, Dogecoin shares the PoW consensus mechanism with Bitcoin, albeit with some modifications. It uses the Scrypt algorithm, which is less energy-intensive compared to Bitcoin’s SHA-256. This choice was strategic, making Dogecoin mining more accessible to individuals without specialized hardware.
Market Impact And Use Cases:
Dogecoin’s journey to mainstream recognition was bolstered by social media and high-profile endorsements, including tweets from celebrities like Elon Musk. These endorsements have led to significant price fluctuations, highlighting Dogecoin’s volatility but also its growing relevance as both a digital currency and a cultural phenomenon.
Initially intended for tipping and small transactions on social media, Dogecoin’s use cases have expanded. It is now accepted by a variety of merchants and has been used in fundraising for charitable causes, showcasing its utility beyond mere speculation. Despite its origins, Dogecoin has demonstrated real-world value, contributing to its endurance in the crypto space.
Future Prospects:
Dogecoin continues to evolve, with its community and developers exploring ways to improve its functionality, efficiency, and scalability. While it may not match the technical ambitions of other cryptocurrencies, Dogecoin’s strength lies in its unique blend of humor, heart, and a committed community, making it a noteworthy and enduring participant in the Proof of Work blockchain landscape.
Litecoin: The Silver To Bitcoin’s Gold
Litecoin, created by Charlie Lee in 2011, is often considered the silver to Bitcoin’s gold. It was developed to address some of the perceived limitations of Bitcoin, primarily aiming to offer faster transactions and lower fees. As a Proof of Work (PoW) blockchain, Litecoin shares many of Bitcoin’s core principles but introduces key technical adjustments that distinguish it within the cryptocurrency space.
Technical Innovations:
One of the most significant innovations of Litecoin is its use of the Scrypt hashing algorithm, as opposed to Bitcoin’s SHA-256. The Scrypt algorithm is less susceptible to the kind of high-powered ASIC mining rigs that dominate Bitcoin mining. This decision was made to democratize mining, allowing individuals with less specialized hardware to participate in the network. Moreover, Litecoin offers faster block generation times—approximately 2.5 minutes compared to Bitcoin’s 10 minutes—enabling quicker transaction confirmations.
Market Position And Adoption:
Since its inception, Litecoin has consistently ranked among the top cryptocurrencies by market capitalization. Its longevity and stability have earned it a trusted position in the market. Merchants and users who seek faster transactions with lower fees have adopted Litecoin, using it for a variety of transactions, from e-commerce to cross-border payments.
Security And Network:
Despite its faster transaction times and different mining algorithm, Litecoin maintains a robust level of security. The PoW consensus mechanism, coupled with the widespread distribution of miners, ensures that the network remains decentralized and resistant to attacks. Litecoin’s active developer community continues to innovate, proposing upgrades and improvements to enhance security, scalability, and user experience.
Community And Future Directions:
Litecoin benefits from a strong, active community that supports its development and adoption. This community involvement has been crucial for Litecoin’s resilience and growth. Educational resources, developer contributions, and merchant adoption initiatives are regularly supported by the community, fostering a healthy ecosystem around the cryptocurrency.
Litecoin’s roadmap includes ongoing efforts to improve scalability and privacy on the network. Innovations such as the MimbleWimble extension block (MWEB) aim to enhance privacy features, addressing one of the criticisms of Litecoin and other similar cryptocurrencies. These developments indicate Litecoin’s commitment to evolving in response to user needs and technological advancements.
Bitcoin Cash: The Result Of The “Blocksize War”
Bitcoin Cash emerged in 2017 as a direct response to the debates surrounding Bitcoin’s scalability challenges. Created from a hard fork of Bitcoin, it aims to fulfill the original vision of Bitcoin as a peer-to-peer electronic cash system with enhanced transaction speed and lower fees. As a Proof of Work (PoW) blockchain, Bitcoin Cash retains many of Bitcoin’s fundamental characteristics while introducing critical changes to improve scalability and usability.
Technical Enhancements For Speed:
The primary distinction between Bitcoin Cash and its predecessor lies in its block size. Bitcoin Cash increased the block size limit from 1 MB to an initial 8 MB, with subsequent upgrades allowing blocks up to 32 MB. This expansion significantly increases the number of transactions that can be processed per block, reducing transaction fees and improving processing times. These changes address one of the core issues Bitcoin faced—its inability to process transactions quickly during peak usage times.
Market Reception And Adoption:
Since its inception, Bitcoin Cash has secured a place among the top cryptocurrencies by market capitalization. Its commitment to maintaining low transaction fees and fast processing times has attracted users and merchants looking for efficient digital transactions. The cryptocurrency has seen adoption for a variety of uses, including online payments, remittances, and as a means of exchange for goods and services.
Security And Decentralization:
Despite the changes in block size, Bitcoin Cash continues to uphold the security standards set by Bitcoin. The PoW consensus mechanism ensures the network remains secure against attacks, and the decentralized nature of mining activities promotes network health and integrity. However, debates have arisen within the community regarding the potential for centralization due to the increased block size, which could, theoretically, require more substantial computational resources to mine effectively.
Looking Forward:
The future of Bitcoin Cash hinges on its ability to balance scalability, security, and decentralization. Ongoing efforts to enhance the network’s underlying technology and address challenges related to block size and transaction efficiency are critical.
However, it needs to be pointed out that BCH has somewhat failed against Bitcoin. It has not managed to match BTC in terms of price performance. The following chart illustrates the price comparison of Bitcoin Cash to Bitcoin since 2017. Despite having backing from key figures like Roger Ver, BCH has not seen widespread adoption, mostly because of limited demand for its increased block size.
Ethereum Classic: Preserving Originality
Ethereum Classic (ETC) emerged from a philosophical divide within the Ethereum community, following a contentious hard fork in 2016. This split was the result of differing opinions on how to handle the aftermath of the DAO attack, a significant security breach that led to the loss of millions of dollars worth of Ethereum.
ETC embodies the principle of “code is law,” maintaining the original Ethereum blockchain without reversing the DAO attack transactions. As a Proof of Work (PoW) blockchain, Ethereum Classic upholds the sanctity of immutability and the original vision of Ethereum as an unalterable digital ledger.
Technical Foundation And Development:
The core ethos of Ethereum Classic is its unwavering commitment to blockchain immutability. In the blockchain context, immutability refers to the principle that once transactions are confirmed, they cannot be altered or reversed. Ethereum Classic’s stance on this principle reflects a fundamental belief in the importance of preserving the integrity of the blockchain, even in the face of challenges and disputes.
Despite sharing its roots with Ethereum, Ethereum Classic operates as a distinct entity with its development path. It maintains the original Ethereum blockchain’s capabilities, supporting smart contracts and decentralized applications (DApps) with the added emphasis on security and stability.
Security Considerations:
Ethereum Classic’s commitment to preserving the original Ethereum blockchain has not come without its challenges, particularly in the realm of security. The network has been subject to several 51% attacks, where attackers gained majority control of the network’s hash rate, enabling them to double-spend coins. These incidents have sparked discussions about the security of PoW blockchains, especially those with a smaller network size and hash rate compared to their larger counterparts.
Development And Future Outlook:
In response to security challenges, the Ethereum Classic community and its developers have been working on solutions to enhance network security and prevent future attacks. Proposals include modifying the consensus mechanism to make 51% attacks more difficult and expensive to execute. Additionally, Ethereum Classic continues to evolve, with ongoing development efforts aimed at improving scalability, interoperability, and the overall utility of the network.
Kaspa: The Newcomer
Kaspa emerges as the latest entrant in the Proof of Work (PoW) blockchain arena, distinguishing itself through innovative technology and a forward-thinking approach to scalability and transaction speed. As a newcomer, Kaspa aims to address some of the most pressing issues faced by traditional PoW blockchains, such as Bitcoin and Ethereum Classic, by introducing a novel blockDAG (Directed Acyclic Graph) structure.
This groundbreaking architecture enables Kaspa to offer unprecedented transaction throughput and minimal confirmation times, setting a new standard for performance in the PoW landscape.
Source: Kaspa.org
Innovative Architecture And Scalability:
The core innovation behind Kaspa is its use of a blockDAG framework, a departure from the traditional blockchain linear model. In this structure, blocks are connected in a DAG pattern, allowing for multiple blocks to be added to the network simultaneously. This parallel processing capability significantly increases the network’s capacity and transaction speed, effectively addressing the scalability limitations inherent in conventional blockchain systems.
Kaspa’s blockDAG architecture allows it to process thousands of transactions per second (TPS), a remarkable feat compared to the transaction throughput of legacy PoW blockchains. Furthermore, the DAG structure reduces transaction confirmation times to mere seconds, enhancing the user experience and making Kaspa an attractive platform for real-time applications and microtransactions.
Market Position And Adoption:
As a newcomer, Kaspa faces the challenge of establishing itself in a market dominated by well-entrenched blockchains. However, its technological advancements and promise of high scalability and low transaction costs have garnered attention from developers, miners, and users alike.
Security And Decentralization:
Despite its novel architecture, Kaspa remains committed to the principles of security and decentralization that are hallmarks of PoW blockchains. The blockDAG structure, while more complex than a linear blockchain, is designed to maintain a high level of security against attacks, including double-spending and 51% attacks. Moreover, Kaspa’s PoW consensus mechanism ensures that the network remains decentralized, with no single entity able to control the majority of the hashing power.
Future Directions And Challenges:
Looking forward, Kaspa aims to continue its trajectory of rapid development and community growth. The project’s roadmap includes enhancements to its core protocol, improvements in user interface and experience, and the exploration of new use cases enabled by its high-speed, scalable infrastructure.
However, Kaspa’s success will depend on its ability to overcome the challenges of network security, user adoption, and competition from both established blockchains and emerging technologies.
Monero: Privacy As A Priority
Monero stands out in the Proof of Work blockchain space with its unwavering commitment to privacy and security. Unlike many cryptocurrencies that offer transparent blockchain transactions, Monero ensures the anonymity of its users through advanced cryptographic techniques. This focus on privacy makes Monero a favored choice for individuals seeking financial confidentiality in their transactions.
Top Proof Of Work blockchain Monero | Created with DALL·E
Advanced Privacy Features:
At the heart of Monero’s privacy mechanism are ring signatures, stealth addresses, and Ring Confidential Transactions (RingCT). Ring signatures obscure the sender’s identity by mixing their transaction with others’, making it virtually impossible to trace the transaction back to its origin.
Stealth addresses add another layer of privacy by creating a one-time address for each transaction, protecting the recipient’s identity. RingCT further enhances privacy by concealing the transaction amount, ensuring all aspects of a transaction are kept confidential.
Monero’s advanced privacy features ensure that users can conduct transactions without the fear of surveillance or tracking. This level of anonymity is critical in an era where financial privacy is increasingly under threat. By encrypting transaction details, Monero provides a secure environment for users to send and receive funds without exposing their financial activities to the public or any prying eyes.
Market Adoption and Use Cases: Monero’s focus on privacy has led to a broad range of use cases, from individuals seeking to protect their financial privacy to businesses requiring confidential transactions. However, this emphasis on anonymity has also attracted controversy, with Monero being associated with illicit activities on the dark web.
Regulatory Challenges And Future Outlook:
The privacy features that make Monero attractive to users also pose significant challenges in terms of regulatory compliance. Governments and financial institutions are increasingly concerned about the potential for cryptocurrencies like Monero to be used for money laundering and other illegal activities. Several crypto exchanges worldwide have already delisted Monero, pressured by local governments and laws.
As the digital landscape evolves, Monero’s commitment to privacy remains unwavering. The development team and community are continually working on improving Monero’s privacy features and usability, ensuring that it remains at the forefront of secure and private digital transactions. Despite regulatory hurdles, Monero’s dedication to protecting user privacy positions it as a critical player in the ongoing discourse on financial privacy and security in the digital age.
Bitcoin SV: Craig Wright’s Vision
Bitcoin SV (BSV) represents a distinctive branch in the evolution of Bitcoin, advocating a return to what its proponents consider Satoshi Nakamoto’s original vision for the cryptocurrency. It emerged from a hard fork of Bitcoin Cash (BCH) in 2018, centering around disagreements on the direction and scalability of Bitcoin.
Craig Wright, a polarizing figure in the cryptocurrency community, has been a vocal advocate for Bitcoin SV, claiming it to be the true Bitcoin as originally intended by Satoshi Nakamoto. However, it’s crucial to note that Craig Wright’s assertions of being Satoshi Nakamoto are marred by controversy and lack conclusive evidence. The ongoing COPA (Crypto Open Patent Alliance) trial further scrutinizes Wright’s claims, highlighting discrepancies and alleged falsehoods in his assertions.
Controversy Surrounding Craig Wright: Wright’s claim to be Satoshi Nakamoto, the pseudonymous creator of Bitcoin, has been a subject of intense debate and legal scrutiny. Despite his assertions, Wright has not provided irrefutable cryptographic proof of ownership of the early Bitcoin keys, a step that would be essential to conclusively proving his identity as Satoshi.
The COPA trial, among other legal challenges, casts a long shadow over Wright’s claims, with the crypto community and wider public remaining skeptical of his assertions due to the lack of verifiable evidence and the emergence of contradictory statements.
Bitcoin SV’s Proposition:
Despite the controversies surrounding its main proponent, Bitcoin SV aims to fulfill what its supporters believe was Nakamoto’s original vision for Bitcoin — a peer-to-peer electronic cash system capable of scaling massively to serve as a global payment system.
Bitcoin SV advocates for larger block sizes to handle more transactions and reduce fees, a key point of divergence from Bitcoin (BTC) and Bitcoin Cash (BCH). The network has implemented significant block size increases, aiming to facilitate greater transaction throughput and enable a wide range of applications, from micropayments to enterprise-level data processing.
Looking Forward:
Bitcoin SV’s market position has been influenced by its technical propositions as well as the controversies of its leading figure. While it has established a niche within the broader cryptocurrency ecosystem, BSV’s adoption and acceptance have been impacted by the ongoing debates over Wright’s claims to be Satoshi Nakamoto. BSV has never ever gained much traction. The BSV/BTC chart shows the lackluster performance.
Conflux Network: Bridging East And West
Conflux Network emerges as a unique Proof of Work (PoW) blockchain with a mission to bridge the technological and regulatory divides between the East and West. Leveraging a novel tree-graph consensus mechanism, Conflux Network aims to offer high throughput, scalability, and security without compromising decentralization — a proposition that addresses some of the most pressing challenges in blockchain technology.
Innovative Consensus Mechanism:
At the heart of Conflux Network’s innovation is its tree-graph consensus algorithm, which allows for the concurrent processing of blocks and transactions. This design significantly enhances the network’s capacity and speed, enabling higher transaction throughput compared to traditional blockchain systems. This technical advancement is crucial for achieving the network’s vision of supporting global decentralized applications (dApps) and services.
Strategic Positioning In The Global Market:
Conflux Network has strategically positioned itself as a bridge between the Eastern and Western worlds in the context of blockchain technology and cryptocurrency. By complying with regulatory standards in China, where it is primarily based, Conflux has managed to secure a unique position in one of the largest markets in the world. This compliance has opened avenues for collaboration with government and private sector projects, distinguishing Conflux from many other blockchain projects that face regulatory challenges.
Through its commitment to regulatory compliance and its technological infrastructure, Conflux Network facilitates cross-border collaboration and transactions. It aims to foster a global ecosystem where developers, enterprises, and users from different jurisdictions can participate in the blockchain economy with reduced friction and increased trust. By doing so, Conflux not only addresses technical challenges but also navigates the complex landscape of international regulations and policies.
Challenges And Opportunities:
Despite its innovative approach and strategic advantages, Conflux Network faces challenges common to many blockchain projects, including the need for wider adoption and recognition in the crowded cryptocurrency space.
However, its unique position as a compliant, scalable, and high-throughput blockchain presents significant opportunities. By continuing to build partnerships and expand its ecosystem, Conflux has the potential to play a pivotal role in the global blockchain landscape, facilitating a more interconnected and efficient digital economy.
Siacoin: Revolutionizing Storage
Siacoin stands out in the blockchain ecosystem as a pioneering platform aimed at revolutionizing digital storage by decentralizing it. As a proof of work (PoW) blockchain, Siacoin offers a secure, private, and cost-effective solution for storing data across a distributed network. This approach not only challenges traditional cloud storage providers but also aligns with the growing demands of the AI and decentralized private networks (DePIN) sectors for reliable, scalable storage solutions.
Decentralized Storage For AI:
In the era of AI, the need for vast amounts of data storage is undeniable. AI models require extensive datasets for training and operation, often entailing significant storage costs and security concerns. Siacoin’s decentralized storage model offers a compelling solution by distributing data across a global network of nodes. This method ensures redundancy, lowers costs, and enhances data privacy and security — key advantages for AI developers and companies seeking efficient ways to manage their data.
The concept of DePIN (Decentralized Private Networks) is gaining traction as a means to enhance privacy and security in digital communications and transactions. Siacoin’s infrastructure naturally complements this sector by providing a decentralized storage solution that can be integral to DePIN architectures. By ensuring data is stored securely and spread across multiple nodes, Siacoin mitigates risks associated with centralized data breaches and offers a robust foundation for DePIN applications.
The intersection of AI and cryptocurrency is an exciting frontier for innovation. Siacoin directly contributes to this narrative by addressing one of the most pressing needs in the AI space: scalable and secure data storage.
The platform’s use of blockchain technology ensures integrity and accessibility of data, which is crucial for AI applications that rely on vast datasets. Additionally, Siacoin’s payment model, which uses its native cryptocurrency (SC) for transactions, seamlessly integrates with the crypto economy, providing a streamlined approach for users to engage with decentralized storage services.
Innovation And Looking Ahead:
While Siacoin presents a groundbreaking approach to data storage, it also faces challenges typical of decentralized platforms, such as user adoption, competition from established cloud storage providers, and the ongoing need to prove its reliability and efficiency at scale. However, its innovative use of blockchain technology to disrupt the traditional storage market positions Siacoin as a potential key player in the future of both the blockchain and AI industries.
As the demand for AI capabilities continues to grow, alongside the increasing importance of privacy and security in the digital realm, Siacoin’s role in the ecosystem could become increasingly pivotal. Its ability to provide a decentralized, secure, and cost-effective storage solution places it at the heart of the convergence between blockchain technology and AI.
The ongoing development of the platform and its adoption by the AI and DePIN sectors will be critical in determining its success and impact on the broader technology landscape.
Comparative Analysis Of Top Proof Of Work Blockchains
The landscape of Proof of Work blockchains is diverse, with each platform offering unique features, advantages, and challenges. This comparative analysis aims to shed light on the top PoW blockchains like Bitcoin, exploring their speed, security, scalability, community, and developer support. Understanding these facets can help users, investors, and developers make informed decisions in the blockchain space.
Speed:
Transaction speed is a critical metric for any blockchain. Bitcoin, the first and most well-known Proof of Work blockchain, processes transactions relatively slowly, with a capacity of 7 transactions per second (TPS) on the base layer. In contrast, newer blockchains like Kaspa aim to dramatically increase transaction speeds using novel consensus mechanisms, claiming to support thousands of TPS. Litecoin and Bitcoin Cash have also implemented various improvements to increase their transaction speeds and reduce confirmation times compared to Bitcoin.
Security:
Security is paramount in the blockchain world. PoW blockchains are renowned for their robust security models. Bitcoin remains the gold standard in security, leveraging its extensive network of miners to prevent attacks. Monero offers additional security features focused on privacy, using ring signatures and stealth addresses to protect user identities. While all Proof of Work blockchains prioritize security, the trade-off often comes in the form of increased energy consumption and slower transaction speeds.
Top Proof Of Work blockchains | Created with DALL·E
Scalability:
Scalability remains a significant challenge for Proof of Workblockchains. Bitcoin has faced scalability issues, leading to high transaction fees and slower processing times during peak usage. Solutions like the Lightning Network for Bitcoin and sidechains like Stacks (STX) are being developed to address these limitations. Kaspa’s unique approach to scalability through its GHOSTDAG protocol highlights the ongoing innovation in this area, promising more scalable solutions within the PoW paradigm.
Community And Developer Support:
A strong community and developer support are crucial for the growth and sustainability of any blockchain. Bitcoin boasts the largest, active community of developers, contributing to the resilience and continuous improvement. Dogecoin, initially started as a joke, has garnered a massive community following, which has played a significant role in its adoption and endurance. Newer entrants like Kaspa and Conflux Network are rapidly building their communities, emphasizing the importance of engagement and support for long-term success.
FAQ: Top Proof of Work Blockchains
What Are The Top Proof Of Work Blockchains?
The top Proof of Work blockchains, known for their robust security and decentralization, include Bitcoin, Dogecoin, Litecoin, Bitcoin Cash, Ethereum Classic, Kaspa, Monero, Bitcoin SV, Conflux Network, and Siacoin. These blockchains leverage the Proof of Work consensus mechanism to validate transactions and secure their networks.
What Are Proof Of Work Blockchains?
Proof of Work blockchains are a type of decentralized ledger technology that uses a consensus mechanism requiring participants (miners) to solve complex mathematical problems to validate transactions and create new blocks. This process ensures security and integrity within the blockchain, preventing fraud and double-spending.
What Is The Biggest Proof Of Work Blockchain?
Bitcoin is the largest and most well-known Proof of Work blockchain in terms of market capitalization, user base, and network security. It was the first cryptocurrency to implement the Proof of Work mechanism, setting the standard for many that followed.
Who Invented Proof Of Work Blockchains?
The concept of Proof of Work predates Bitcoin, but Satoshi Nakamoto, the pseudonymous person or group of people who developed Bitcoin, was the first to implement it as a consensus mechanism for a cryptocurrency blockchain in 2009. This innovation paved the way for the development of other Proof of Work blockchains.
How Do I Invest In Top Proof Of Work Blockchains?
Investing in top Proof of Work blockchains typically involves buying the blockchain’s native cryptocurrency through a crypto exchange. Potential investors should create an account on a reputable exchange, deposit funds (fiat or crypto), and then purchase the desired cryptocurrency.
What Are the Alternatives To Proof Of Work Blockchains?
Alternatives to Proof of Work blockchains include Proof of Stake (PoS), Delegated Proof of Stake (DPoS), and other consensus mechanisms like Proof of Authority (PoA) and Proof of Space and Time. These alternatives seek to address some of the limitations of Proof of Work, such as its high energy consumption, by offering more energy-efficient and scalable solutions.
Featured image created with DALL·E
Disclaimer: The article is provided for educational purposes only. It does not represent the opinions of NewsBTC on whether to buy, sell or hold any investments and naturally investing carries risks. You are advised to conduct your own research before making any investment decisions. Use information provided on this website entirely at your own risk.
Bitcoin’s price has been on the run for the past several months, having surged from under $20,000 to over $50,000 since June 2023.
While that was mainly driven by the anticipation and the subsequent approval of nearly a dozen spot Bitcoin ETFs in the States, it seems retail traders are still not present, which begs the question of whether their arrival could propel another price surge for the asset in the next few months.
How Did We Get Here?
Data from Google Trends shows the typical behavior of retail investors, as they tend to search more for investment options that are very hot. This leads to them entering the market in question in what has been termed as FOMO (fear of missing out).
The cryptocurrency market is perhaps best known for such sentiment changes as it tends to get overheated really quickly when the demand from such investors skyrockets. In turn, this leads to growing prices before the inevitable correction and the market cooling off.
The last such cycle was in 2021, when prices were booming, and the retail crowd was all around. Laser-eyes appeared on Twitter with promises of $100,000 per BTC in the next few months. That didn’t happen; BTC slumped in value, and retail investors disappeared.
Bitcoin started to recover in June 2023 when BlackRock filed to launch its own spot BTC ETF. Given the company’s mind-blowing success rate with ETFs, institutions started to pay more attention to Bitcoin, and the overall anticipation changed from “The SEC will never allow a spot BTC ETF” to “It’s a matter of when not if.”
That change led to growing hype and, subsequently, rising prices, and BTC soared from under $20,000 in June 2023 to over $40,000 in early January. Then came the actual approvals of 11 spot BTC ETFs, the inevitable sell-the-news moment, before the cryptocurrency went back on the offensive and soared past $50,000 for the first time in more than two years on the actual demand for those financial products.
But one thing still seems to be missing.
Where Is the Retail?
With large investors and institutions seemingly going after Bitcoin with large purchases, reports frequently emerge that smaller holders (sharks and shrimps) have been disposing of their BTC stash. Google Trends data shows something similar, as the worldwide queries for Bitcoin are far from the 2017 boom, the 2021 bull run, and even the 2022 industry crashes.
Aside from a brief spike around the ETF approvals in mid-January, the searches have barely surpassed the 2019 bear market and the 2020 Covid-induced correction.
Bitcoin Google Searches Worldwide. Source: Google Trends
This only goes to show that retail investors have not really arrived, even though BTC’s price has more than doubled since last June. However, the upcoming halving could change all of that, given Bitcoin’s price performance after each of the previous ones.
As such, it would be interesting to follow if the retail crowd could be behind another run that will result in a new all-time high for Bitcoin in the next few months.
SPECIAL OFFER (Sponsored)
Binance Free $100 (Exclusive): Use this link to register and receive $100 free and 10% off fees on Binance Futures first month (terms).
