Giorno: 4 Novembre 2021

Bitcoin’s (BTC) market dominance continues to fall even as the apex cryptocurrency hit an all-time high of $63,742.28 on Monday.

What Happened: At press time, BTC had a market capitalization dominance of 53.8%, which is lower than last week when the coin enjoyed market domination of 55.6%.

The second virtual currency in terms of market domination remains Ethereum (ETH) at 12.03%.

In terms of price, BTC traded 4.71% higher at $63,201.13 at press time while ETH traded 6.02% at $2,288.04 at press time.

The loss of dominance signifies the heralding of the so-called “altcoin season,” according to an analyst.

Michaël van de Poppe predicted a “very bullish” summer for alt-coins. Previously in January, he forecast a $10,000 price for ETH.

See also: Is Bitcoin a Good Investment?

Why It Matters: BTC has risen 9.56% on a seven-day trailing basis, however, several cryptocurrencies have outshined those gains.

Dogecoin (DOGE), the frequent subject of Tesla Inc

 Elon Musk’s tweets, gained 71.01% for the week. DOGE traded 52.07% higher at $0.11, which is an all-time high.

XRP (XRP) is up 68.98% for the week and traded 25.14% higher on a 24-hour basis at $1.79.

See Also: Why Is XRP (Ripple) Hitting Record Highs Despite SEC Threat?

Other notable weekly gainers include  KuCoin Token (KCS), Binance Coin (BNB), PancakeSwap (CAKE), and Bitcoin Gold (BTG) all up by 49.27%, 38.91%, 37.78, and 36.42% respectively.

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The Securities and Exchange Commission is poised to allow the first U.S. Bitcoin futures exchange-traded fund to begin trading in a watershed moment for the cryptocurrency industry, according to people familiar with the matter.

The regulator isn’t likely to block the products from starting to trade next week, said the people, who asked not to be named while discussing the decision. Unlike Bitcoin ETF applications that the regulator has previously rejected, the proposals by ProShares and Invesco Ltd. are based on futures contracts and were filed under mutual fund rules that SEC Chairman Gary Gensler has said provide “significant investor protections.”

A spokesperson for the SEC declined to comment, as did an official at ProShares.

Bitcoin almost touched $60,000, the highest since April, while futures on crypto-linked stocks rallied in U.S. premarket trading. The largest cryptocurrency by market value has rallied almost 90% in three months and is closing in on the record high of $64,869 set earlier this year.

Barring a last-minute reversal, the fund launch will be the culmination of a nearly decade-long campaign by the $6.7 trillion ETF industry. Advocates have sought approval as a confirmation of mainstream acceptance of cryptocurrencies since Cameron and Tyler Winklevoss, the twins best known for their part in the history of Facebook Inc., filed the first application for a Bitcoin ETF in 2013.

Approval has for years been out of the grasp of issuers who, amid myriad false signs of progress and outright rejections, have tried to get a variety of different structures cleared for trading. Over the years, there have been plans for funds that proposed to hold Bitcoin via a digital vault or that could use leverage to juice returns. Others sought to mitigate Bitcoin’s famous volatility, a key point of contention for the SEC.

The SEC has in the past argued that the crypto space is plagued with investor hazards. The SEC had expressed concern that prices could be manipulated and liquidity might be insufficient, and that Bitcoin’s drastic price swings may be too much for individual investors. Bitcoin’s last three full-year returns were a 74% loss followed by gains of 95% and 305%. Additionally, the SEC has questioned whether funds would have the information necessary to adequately value cryptocurrencies or related products. There have also been questions about validating ownership of the coins held by funds and the threat from hackers.

Many crypto advocates were heartened when Gensler took the helm at the agency. They cited his previous interest in the crypto world – he once taught a class at MIT’s Sloan School of Management called “Blockchain and Money.” But the chairman has also in recent months referred to the space as the “Wild West” and has signaled that he wants more robust oversight of the markets.

The mood appeared to shift in August, when Gensler signaled he’d favor funds based on CME-traded Bitcoin futures filed under a 1940s law. He reiterated that stance late last month.

That’s led to a wave of futures-backed filings and unbridled optimism among issuers that approval could be imminent. The speculation has fueled a torrential rebound in the price of Bitcoin, which has essentially doubled since breaking below $30,000 in late July.

Four futures-backed Bitcoin ETFs could begin trading on U.S. exchanges this month, with deadlines for applications from VanEck and Valkyrie also approaching. Meanwhile, dozens of cryptocurrency exchange-traded products have launched in Canada and across Europe.  Valkyrie declined to comment.

(Updates the price of Bitcoin and crypto-linked stocks in the fourth paragraph.)

Bitcoin has maintained high prices well into the first week of November. The month is expected to follow bullish trends that were triggered in the previous month and bitcoin has not been disappointed in this regard. However, some metrics remain low compare to the price of BTC. This could be as a result of investors taking profit in the market but low enough to draw attention to them.

BTC had seen a lot of investment pour into it the week after the first ETFs went live. The record-breaking $1.4 billion inflow for the week had pushed the price of the digital asset towards a new all-time high. Yet, subsequent weeks have not fared as well in the market. One of the ways this decreased inflow has shone through has been spot trading volumes for the asset.

Bitcoin Spot Trading Low

In comparison to the current price of the digital asset, spot trading volumes are expected to go up in tandem with the price hike. This has not been the case. Spot trading volumes for the week are down compared to the previous week. The 7-day trading average for the digital asset shows a significant downtrend in the same time period. An almost $1 billion decrease saw the 7-day average real trading volume for the asset drop to $6 billion.

The last time BTC was this high, spot trading volumes were significantly higher. The Spring rally saw spot volumes go up along with the price of bitcoin, driving the price higher in that regard. This time, trading volumes have continuously decreased despite the price of the digital asset hitting a new all-time on October 20th.

Spot trading volumes are crucial to the performance of the asset in the market. If the market is to see BTC challenge a new all-time high, it is expected that spot trading volumes would need to go up to accommodate for this increase. Otherwise, momentum in the asset may slow to a crawl, causing the value to stagger downwards in the meantime.

BTC Futures Premium Decline

Bitcoin futures premium saw a significant uptick in October with the release of the ETFs that brought strong institutional demand into the market. The momentum was maintained for the better part of a week. However, the market is beginning to see a substantial decline in demand.

Futures premiums on CME saw a decline back to early October levels. Increased cash-and-carry activities in the CME Futures are speculated to be the main driver behind this decline. Still, it is a clear indication that institutional interest took a sharp downturn after the ETFs record opening in October.

Open interest on CME has also recorded a decline. But this has not been the case across all open interest platforms. Open interest on top cryptocurrency exchange Binance has seen growing interest. Cash-and-carry activities indicate traders are increasing their exposure. Although some traders who had long exposure on CME had seen gains by the close of last month.

The large American-based bitcoin self-mining company, Marathon Digital Holdings, reported an increase of total BTC holdings on its October update of the company’s bitcoin production and mining operations.

In October, the company increased its total bitcoin holdings to around 7,453 BTC after mining 417.7 bitcoins. This translates to $457.4 million of market value, and their total liquidity now reaches approximately $478.3 million.

The company has been ‘hodling’ the totality of its mined and bought bitcoins since October 2020, taking into account 4,812.66 BTC purchased past January at the price of $31,168 per BTC.

Furthermore, after buying $120,7 million of mining machines from Bitmain, they received a shipment of roughly 42,381 top-tier ASIC miners, “with 12,331 delivered to a Compute North facility” pending deployment “and an additional 3,285 ASIC miners currently in transit”. They currently have 27,280 active miners on their fleet, resulting in a production of 2.96 EH/s.

Their MaraPool, which is fully audited and focuses on lowering BTC mining’s environmental impact, reached 3.0 EH/s with a network hash rate of 170.9 EH/s. Fred Thiel, Marathon’s CEO, stated

Big Horizons For Bitcoin Mining In The U.S.

Last month, the company secured a $100 million yearly renewable loan with Silvergate Bank to fund their mining operations and equipment. They currently expect more growth during the fourth quarter, said Fred Thiel:

Back in May, the company had accounted for its plan to transition into the first mining pool to produce “100% carbon neutral and OFAC compliant bitcoins”, as well as its agreement with Compute North, who offers a large-scale service provider with “environmentally friendly hosting and infrastructure”.

The partnership is meant to help them achieve their goals by allowing them to operate their mining fleet “in regulatory environments that have proven to be friendly to Bitcoin miners and at rates that we believe are among the lowest in the country.”

Bitcoin’s latest rise to $67,000 has befuddled billionaires and spooked central banks.

For most of its existence, the cryptocurrency has been described as a bubble that is fit to burst – but so far, each stomach-churning fall has been matched with an equally dizzying recovery.

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Although awareness of this digital asset has risen in recent years, it remains little understood.

The Financial Conduct Authority revealed in June that the number of Britons who own cryptocurrencies has surged to 2.3 million – yet at the same time, the number of people who could accurately describe what they are has fallen.

This is a huge worry to regulators. They fear consumers who may not know what they’re doing will end up losing eye-watering sums of money – and indeed, some already have.

Some countries want to ban Bitcoin altogether – India and China among them – but doing this is easier said than done.

The cryptocurrency’s decentralised nature means that the Bitcoin network is spread around the world. There’s no single person who can be pressured to shut it down, and no one computer that can take the whole thing offline.

This has created a years-long headache for regulators, not least because of how Bitcoin is often demanded after ransomware attacks.

And all of this comes before we discuss the cryptocurrency’s impact on the environment. If Bitcoin was a country, it would be the 24th-biggest consumer of energy – ahead of Poland and Egypt, and about to overtake Thailand and Vietnam. To compound the problem, less than half of the energy it uses comes from renewable sources.

At the same time, we’re starting to see how this cryptocurrency could potentially be used in daily life.

Several countries in Latin America are keeping a close eye on El Salvador, which has taken the bold step of embracing Bitcoin as legal tender. The cryptocurrency can now be used as a payment method across the country – including in Starbucks, McDonald’s and Pizza Hut. And given how migrant workers attempting to send money back home to their loved ones currently face high fees when using cash, it’s also hoped that Bitcoin could lower these costs dramatically.

Inevitably, the other question is whether Bitcoin’s price could rise further.

The British financial institution Standard Chartered has predicted that Bitcoin could hit $100,000 (£72,000) in early 2022. A Bloomberg Intelligence analyst also told me that this price is now “the path of least resistance” in the short term.

But increasing regulatory scrutiny and a precarious global economy mean that this is far from guaranteed.