Blockchain
Bitcoin breaks $40,000 and sets its sights on a new all-time high, ETH fees spike as a new price record is set, and Elon Musk really loves Dogecoin.
Cointelegraph By Andrew Thurman
Coming every Saturday, Hodler’s Digest will help you track every single important news story that happened this week. The best (and worst) quotes, adoption and regulation highlights, leading coins, predictions and much more — a week on Cointelegraph in one link.
Top Stories This Week
Bitcoin eyes $50K less than a month after BTC price broke its 2017 all-time high
Bitcoin is showing signs of a newfound rally after breaking the $40,000 resistance area, fueling hope that we might be about to see a new all-time high.
It’ll be critical for Bitcoin to stay above this level in the foreseeable future. The uptick came days after MicroStrategy pitched Bitcoin to more than 1,400 companies.
Cointelegraph Markets analyst Michaël van de Poppe says BTC’s strength means its market dominance is rebounding at the expense of most altcoins.
He added: “An apparent breakout above the all-time high above $42,000 however, should propel Bitcoin’s price to $50,000.”
This is the first time that Bitcoin has surged above $40,000 for 23 days, but this time around, market sentiment is a lot calmer, and the derivatives market isn’t as overheated.
Some institutions have used this week’s surge to take some money off the table, with Ruffer Investment booking $650 million in profits after doubling its cash in just two months.
Ether price breakout to $1,750 sees Ethereum network fees hit all-time high
ETH has been building on recent all-time highs this week, climbing ever closer to $2,000.
After hitting $1,756.51, the world’s second-largest cryptocurrency took a little bit of a tumble, falling back to $1,672.99 at the time of writing.
The record high came off the back of intense trading interest in DeFi coins, many of which use the Ethereum network as their basis. Anticipation has also been building over the launch of Ether futures from CME Group.
There’s just one problem: Gas fees are rising. At one point this week, transaction costs surged so high that some exchanges were forced to halt withdrawals altogether.
Amid fears this could affect the smooth running of DeFi protocols, Blockstream developer Grubles warned: “This is a legit crisis. Going to have to stock up on popcorn to see how Ethereum digs its way out of this.”
“Ur welcome” — DOGE soars after Elon Musk returns to Twitter… to shill Dogecoin
To an extent, the surge in crypto prices could be attributed to Elon Musk. For reasons beyond understanding, the world’s richest man is obsessed with Dogecoin.
The Tesla CEO raised eyebrows this week when he shared a doctored photo of himself masquerading as Rafiki from The Lion King, with a shiba inu superimposed onto Simba’s face in the famous scene where the lion cub is held aloft on Pride Rock.
Musk helped DOGE surge this week, but remarks he made on Bitcoin during a Clubhouse discussion failed to have as much of an impact as last Friday when BTC leaped up by thousands of dollars because Musk added #bitcoin to his Twitter bio.
During the Clubhouse chat, the billionaire was quoted as saying: “I am late to the party but I am a supporter of Bitcoin.”
New research this week examined six times when Musk had tweeted about BTC or DOGE, finding that his remarks caused price surges and a “significant increase” in trading volumes.
But the paper from Blockchain Research Lab warned: “While Musk’s behavior and communication can be deemed positive or funny in nature (and therefore arguably uncritical), similar research has already revealed that negative tweets can also have a negative impact on financial returns.”
Reddit rage as XRP price crashes 50% hours after hitting two-week highs
XRP was the subject of a trading frenzy last week, enjoying an 86% breakout after becoming the new coin of focus in r/Satoshistreetbets, a spin-off of r/Wallstreetbets.
The pump came despite the fact that XRP’s legal woes have shown no sign of going away, with the SEC set to face off against Ripple later this month.
Telegram and Discord chats had encouraged people to buy XRP en masse on Feb.1 at 8.30 am ET, but as you might expect, the pump ended in tears. Within two hours, the altcoin crashed by almost 50%… burning new investors in the process.
Cointelegraph Markets contributor Keith Wareing tweeted: “Even though the $XRP army get aggressive when you warn them about the escrow shaped elephant in the room, I still can’t help but feel sorry for those that bought at 0.75c today. X R (I)P.”
PayPal to offer crypto payments for merchants, limited trading on Venmo
PayPal has revealed that its crypto trading service has “exceeded expectations” since its limited launch in the United States.
The payments giant is now set to double down on crypto, blockchain and digital currencies in 2021, with “significant” investment in a new unit. According to the company, those who bought Bitcoin ended up logging in twice as much as they did before.
Following on from the “exceptional response,” CEO Dan Schulman said that crypto will be offered as a funding source when users shop at any of PayPal’s 29 million merchants later this quarter, and an “extensive roadmap” of new services is going to follow.
In November, PayPal took a major step toward the adoption of digital assets by allowing its U.S. users to purchase crypto directly through the app. Customers based in the United States are limited to trading $20,000 per week. Since that time, crypto trading volume on the platform has reached record highs, peaking at $242 million in transactions on Jan. 11.
Winners and Losers
At the end of the week, Bitcoin is at $40,776.40, Ether at $1,676.86 and XRP at $0.44. The total market cap is at $1,218,786,711,013.
Among the biggest 100 cryptocurrencies, the top three altcoin gainers of the week are UMA, 0x and PancakeSwap. The top three altcoin losers of the week are HedgeTrade, ThorChain and Fantom.
For more info on crypto prices, make sure to read Cointelegraph’s market analysis.
Most Memorable Quotations
“After a record-breaking year in 2020 that saw it jump more than 300%, Bitcoin looks to stay strong in 2021 as more retail — and big-name institutional buyers — enter the market.”
Jesse Cohen, Investing.com senior financial analyst
“While Musk’s behavior and communication can be deemed positive or funny in nature (and therefore arguably uncritical), similar research has already revealed that negative tweets can also have a negative impact on financial returns.”
Lennart Ante, Blockchain Research Lab co-founder
“If a single tweet can potentially lead to an increase of $111 billion in Bitcoin’s market capitalization, a different tweet could also wipe out a similar value.”
Lennart Ante, Blockchain Research Lab co-founder
“ur welcome”
Elon Musk, Tesla CEO
“We also saw an exceptional response from our crypto launch […] The volume of crypto traded on our platform greatly exceeded our expectations.”
Dan Schulman, PayPal CEO
“The economic environment for Bitcoin right now could not be better.”
Duncan MacInnes, Ruffer co-manager
“Even though the $XRP army get aggressive when you warn them about the escrow shaped elephant in the room, I still can’t help but feel sorry for those that bought at 0.75c today. X R (I)P.”
Keith Wareing, Cointelegraph Markets contributor
Prediction of the Week
BlockTower Capital CIO estimates another 9–22 months of bull run for crypto
With renewed optimism around how Bitcoin is performing, the inevitable question is this: How long will the bull run last?
Well, according to BlockTower Capital’s chief information officer Ari Paul, we’ve got at least nine more months to look forward to.
He said: “This is where we get ongoing, dizzying rotation. BTC up, then when BTC takes a breather, ETH and some large caps (and in this regime, DeFi blue chips), then small caps, rinse and repeat. Of course, throw in some 30-60% retracements for fun.”
In terms of how Bitcoin will perform, Paul added: “Price wise — my guess is BTC ends the bull run between $100k-$400k and alts do better.”
FUD of the Week
Guggenheim CIO under fire for the timing of his changing BTC sentiment
Scott Minerd’s apparent shift from bullish to bearish and back again on either side of an SEC filing related to a $500-million investment in BTC has been raising eyebrows on social media.
The Guggenheim CIO had hit the headlines after claiming that BTC would see a “full retracement back towards the $20,000 level” — later adding there wasn’t enough institutional support to warrant a price above $30,000.
Days later, Minerd claimed Bitcoin has the potential to reach $600,000 in the long run based on its scarcity and the value of gold.
Some on Twitter were not impressed. Economist Alex Krüger wrote: “Remember Guggenheim wants you to sell #bitcoin so they may buy lower. Been trying to scare the market into thinking price will crash to $20,000, even though they think it’s worth $400,000.”
New class action against Robinhood alleges oligopoly manipulation
It’s been quite a week from Robinhood, the stock trading app that’s continuing to reel from the backlash it suffered after restricting trading in GameStop.
A class-action lawsuit has been filed that the drastic move denied customers a chance to profit from volatility in GME shares — manipulating the course of the stocks.
Meanwhile, some reports suggested that Robinhood was planning on postponing its planned IPO as it tries to focus on tackling the PR disaster. Other outlets have cast doubt on this, saying a stock market debut is going ahead as intended.
It’s also been claimed that Robinhood’s CEO, Vlad Tenev, is going to testify before the U.S. House Financial Services Committee over the firm’s role in recent volatility.
Robinhood, the stock trading app formerly popular with millennials, is facing another class-action suit, following its recent temporary suspension of purchases of GameStop and other “meme-stocks” through its platform.
Polish crypto exchange employee in induced coma after armed attack
A member of staff at a Polish crypto and gold exchange has been placed into an induced coma after an armed attack.
The offices of FlyingAtom, in the city of Olsztyn, were targeted on Jan. 22. The masked attacker managed to escape with gold worth approximately $120,000.
A suspect was subsequently detained in connection with the incident, with the exchange thanking the police for their help.
Best Cointelegraph Features
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r/Wallstreetbets vs. Wall Street: A prelude to DeFi bursting onto the scene?
Was stock trading app Robinhood the villain in the GameStop saga? “In a decentralized trading market, no one would have that power.”
Cointelegraph By Gagan Grewal
With an explosion of video streaming as a result of the COVID-19 pandemic and now around $40 billion locked into decentralized finance protocols, it’s time for decentralized finance and the film industry to meet.
Film financing is a cumbersome and inefficient system. Investors are the first to put their money in but last to see any return. There is no transparency into how funds are being used during production or how profits are allocated after distribution. Investment decisions are generally based on very little data about what people actually want to watch, so the chances of a film’s success are completely unknown until its release. DeFi and blockchain technology can address many of these problems by forming a new realm of decentralized film financing, or DeFiFi.
Related: It’s time for Hollywood to move to blockchain — Yes, you read that right
What is DeFiFi?
Imagine the creation of a decentralized film fund, in which financiers all hold a stake in the success of films that are produced by the platform. Using blockchain technology and decentralization, creators could present their projects to the community, which would vote on what films receive funding. The winning projects would be granted the financing they need from community-managed funds.
The production of the films would happen off-chain, so there would be a need for oversight from members of the DeFiFi community to ensure funds are being used appropriately during production. The completed film could then be distributed on the platform to the built-in audience who voted for it. The accounting process would be completely transparent, as the in-app currency paid to watch the film would flow back into the DeFiFi fund and be distributed to all participating parties per the encoded contract. Since all the transactions would be recorded on the immutable and transparent ledger, there could be no confusion about how profits were being used.
This level of transparency is unheard of in the existing, fragmented processes of financing, production and distribution. In a DeFiFi ecosystem, creators who would otherwise have no access to film financing gain the chance to bring their ideas to life. Regular people who are generally at the whims of whatever Hollywood decides would gain a say in what films are produced. Financiers can make smarter decisions on what films to back based on what real people want to watch.
By harnessing the “wisdom of the crowd,” each film has a built-in audience of supporters who would organically assist in the promotion of the film once released. The unprecedented visibility into the use of funds and distribution of profits could dramatically increase the number of people willing to invest in films, potentially leading to a new golden age for the movie industry.
The golden age of decentralized film
With investing in films made easier and more transparent, more financiers will want to participate. The more capital available for film production, the more films can be produced, supporting more filmmakers with interesting ideas and providing more great content to movie fans around the globe. The dawn of a new era in the decentralized film industry could be upon us.
Other use cases for DeFi and blockchain technology that would help to expand the entertainment ecosystem to further support creators and incorporate fan participation would be digital rights tracking and rewards for engagement. At present, the only recourse for creators whose ideas have been used without credit or payment is to go to court, which is prohibitively expensive for many filmmakers. A digital rights management system would allow artists to register their ideas at any stage of the creative process — i.e., concept, treatment, script, rough cut, final film. Their submission would be recorded on an immutable ledger and timestamped, providing leverage to any creator whose ideas or work has been stolen without compensation.
Related: Circling back to blockchain’s originally intended purpose: Timestamping
Additionally, fans and other ecosystem participants can be rewarded for their participation in building a thriving film community — unlike on social media platforms today, where users are responsible for the billions of dollars made by the platforms but who receive no compensation for their part in these tech giants’ explosive growth.
It’s about time users gain control over their own data, which has become equivalent to currency in the digital realm. In a DeFiFi ecosystem, users could be rewarded for contributing through curating content, promoting posts or performing other tasks essential to the upkeep of the decentralized network, such as running nodes, validating blocks of transactions or identifying bugs in the code.
DeFi is only just getting started
DeFi has contributed immensely to the growth of the entire cryptocurrency economy and will continue to play a pivotal role in drawing users to the space. Many of the most impactful use cases for DeFi have yet to be fully realized, and so the growth we will see in 2021 will well-surpass the surge in 2020. There are opportunities to be leveraged in bringing DeFi to film but also to fundraising, grant issuance, corporate treasuries and hedge fund governance. The possibilities are endless.
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.
The views, thoughts and opinions expressed here are the author’s alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.
Gagan Grewal is the CEO of Mogul Productions and leads the financial vision for the platform, including the development of the Mogul Continuous Organization and Smart Wallet. Prior to joining Mogul, Gagan was the managing partner of a private equity firm, led the private banking team for Scotia Wealth Management, and founded his own recruiting firm with a successful exit.
Cointelegraph By Jordan Finneseth
As blockchain technology increasingly becomes part of the mainstream conversation, its integration with today’s most used technologies is bound to increase. This means that it’s only a matter of time before video streaming, digital music and social media see gradual blockchain integrations take place.
Audius (AUDIO) is one project that is chasing the first-mover advantage in the music streaming sector. The music-sharing and streaming protocol facilitates transactions between creators and listeners, making it relatively effortless for users to distribute and monetize audio content.
The project has received increasing attention for its approach to decentralizing the music industry and on March 2 the team celebrated reaching 3 million monthly active users.
Data from Cointelegraph Markets and TradingView shows that the price of AUDIO surged 108% since the start of March from a low of $0.38 to a new all-time high of $0.79 on March 4 as the altcoin’s trading volume spiked from $3 million to a record $55 million.
Staking incentives drive user adoption
The first major increase in users followed the project’s October 2020 launch and the activation of staking on the Audius platform in December. This enabled AUDIO holders to earn a 7% yield for tokens that were staked on the network while they listening to music and interacted with the protocol.
By the end of January, the platform had 1.8 million active users and a total of 122 million AUDIO tokens staked on the network. These figures have since increased to 3 million users and a total of 182.5 million staked AUDIO as the platform continues to integrate new features that incentivize community involvement.
VORTECS™ data from Cointelegraph Markets Pro began to detect a bullish outlook for AUDIO on Feb. 28, prior to the recent price rise.
The VORTECS™ score, exclusive to Cointelegraph, is an algorithmic comparison of historic and current market conditions derived from a combination of data points including market sentiment, trading volume, recent price movements and Twitter activity.
As seen in the chart above, the VORTECS™ score for AUDIO hit a peak of 69 on Feb. 28, just before the start of a prolonged uptrend in price which was further identified by a VORTECS™ score of 80 on March 1. After pulling back over the next 3 days the score again spiked to 70, just hours before a significant rise in the price of AUDIO.
On March 5, the project revealed its plans to integrate non-fungible tokens (NFT) into the protocol as part of its effort to offer a full-service decentralized platform and expand its user base.
NFTs have become a hot topic in the cryptocurrency sector in recent months, and their integration into the AUDIO platform is likely to bring a renewed wave of interaction from users.
As blockchain technology continues to become more prominent in mainstream society, Audius appears well-positioned to become a leader in the streaming music space thanks to a rapidly expanding user base and a growing list of incentives that entice users to stay active on the platform.
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.
Cointelegraph By Jordan Finneseth
The rising popularity of decentralized finance (DeFi) has brought fresh attention and optimism to the cryptocurrency sector with the total value locked on all protocols increasing from $1 billion to $59 billion in less than a year and the top 5 platforms accounting for $24.33 billion of the total value.
Rising gas fees have been one of the most noticeable results of the increasing interaction with DeFi protocols and currently, the Ethereum (ETH) network hosts the majority of the top DeFi projects. Gas fees have been steadily rising since November 2020 and reached a peak on Feb. 23 when the average transaction cost reached 373 Gwei which is approximately $11.72 at the current Ether price.
Since Feb. 23, fees have declined by 65% with the average cost dropping to 131 Gwei on March 3 and data shows that certain times of the day offer fees below 70 Gwei.
DeFi transactions decreased as the market corrected
One possible source for the declining gas fees seen over the past couple of days can be found by looking at the daily decentralized exchange (DEX) volume.
Data from Dune Analytics shows that trading volume on DEXs has been on the decline since peaking at $4.35 billion on Feb. 23 and the DEX daily 24-hour growth metric was down by 50% on March 3.
According to Connor Higgins, a data scientist at Flipside Crypto, fees have decreased over the past few days, but rather than attributing it to one specific cause, Higgins said that the high fees seen on Feb. 23 were an outlier when compared against the overall average on a longer time span.
Higgins said:
“On average fees did fall, but it looks more like they are normalizing after a day of unusually high fees.”
As seen on the chart above, gas fees were significantly higher than the average between Feb. 22 and Feb. 23 when network congestion increased due to a market-wide sell-off that saw BTC price fall by 23.6% and altcoin prices also corrected sharply. After the market stabalized, gas fees returned to their normal average.
Rising NFT transactions clo the Ethereum network
Those using the Ethereum network might have expected to see a more meaningful decline in gas fees as DeFi transactions decreased but this has not been the case. One reason rates remain high could be the recent increase in activity in the Non-Fungible Token (NFT) sector.
As more and more NFT projects launch and hold auctions, high transaction costs and network congestion are likely to continue on the Ethereum network until a widely integrated scaling solution is implemented.
Layer 2 solutions and protocols with cross-chain bridges to Ethereum, such as Polygon and the Binance Smart Chain, have emerged over the past two months and many projects are migrating to these platforms as the best short-term solution to high fees.
Projects like Aavegotchi and SushiSwap have shown how effective these networks can be following their recent integrations with Polygon, and it’s likely that other NFT and DeFi projects will follow suit as the transaction costs and speeds are superior to Ethereum.
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.
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