good morning. Here’s what’s happening:
price: Bitcoin and Ether start flat in East Asia as debates and concerns about Bitcoin’s role halve. Cobo’s data shows a recovery in market confidence, with Bybit linking Memecoin’s surge to reinvestment and warning that mining will be affected if Bitcoin doesn’t stabilize above $30,000 after the halving. ing.
insight: Bitcoin decongestion impacts altcoin rallies, demand for BRC-20 tokens brings high fees, boosts miner revenue without new users, changes the relationship between Bitcoin and Ether and its market dynamics there is a possibility.
Bitcoin and Ether both started the East Asian trading day flat, with the world’s largest digital asset falling 0.6% to $27,037 and Ether rising 0.4% to $1,824.
Assets under custody (AUC) data from institutional investor management firm Kobo shows that confidence in the cryptocurrency market reached its lowest point in February 2022 before recovering rapidly from March onwards. Kobo’s AUC has already recovered to November 2022 levels, indicating funds are returning to the market, the company shared with CoinDesk in a memo.
“The recent surge in memecoin, which has coincided with a general decline in interest in cryptocurrencies (as measured by Twitter and YouTube analytics), suggests that these capital inflows have benefited from crypto’s strong performance year-to-date. This suggests that it is likely a result of investor rotation of the profits that have been made,” Charmin Ho, Bybit’s head of cryptocurrency insights, said in a memo to CoinDesk.
Ho wrote that there may still be room for further declines and that these ranges represent attractive accumulation zones for long-term HODLers.
Meanwhile, the macro economy continues to be a defining part of the Bitcoin story. But whether Bitcoin is a store of value or a hedge against risk is a debate that won’t be resolved anytime soon.
Next is halving. This is expected sometime in early 2024 and is believed to be the next chapter in the pricing story. But Cobo CEO Mao Shixing disagrees.
“From an economic point of view, the Bitcoin halving doesn’t play a significant role right now, but this is the logic of a good story,” he told CoinDesk in a note.
One of the things to watch, he said, is the impact it will have on miners.
The S19 mining machine is still the mainstream choice for miners. But he told CoinDesk that if the coin’s price doesn’t stabilize above $30,000 after the next halving event, scheduled for next year, these mining machines will inevitably have to shut down. said deaf.
Bitcoin is clearing the mountain of unconfirmed transactions, but it’s still at record highs
The easing has taken the wind out of the bull market for Bitcoin counterfeits, Bitcoin Cash (BCH) and Bitcoin SV (SBV). Both currencies rallied last week as investors poured money into alternative currencies following Bitcoin congestion. Bitcoin will continue to maintain a block size of 1MB. In contrast, Bitcoin Cash and Bitcoin SV have extended block sizes to 32 MB and 128 MB respectively. As a result, these two protocols offer significantly lower transaction costs than the Bitcoin protocol.
After the episode is over, you can look back at the final tally of fees paid during Bitcoin’s Ordinals rally. As Glassnode pointed outit’s huge.
The surge in demand for block space with the BRC-20 token has resulted in significantly higher fees, and only the fifth time in Bitcoin’s history that the average fee per block exceeded the block subsidy. This pushed total daily fees close to an all-time high of $17.8 million per day, boosting miner revenue by another $100 million and boosting fee-based miner revenue to 11.5%, Glassnode wrote. there is
Meanwhile, it also saw a record-breaking number of transactions, up 39% from its peak in 2017, reaching a record high of 682,000.
But will this bring in new users? Not much. Despite the surge in transaction activity, the number of active addresses has decreased, indicating a trend of BRC-20 users to reuse Bitcoin addresses.
What many are wondering is, will the introduction of BRC-20-powered tokens and NFTs into Bitcoin change the relationship between Bitcoin and Ether in any way?
As CoinDesk previously reported, the 30-day rolling correlation between Bitcoin and Ethereum prices has dropped to 77%, the lowest since 2021, suggesting a long-term decoupling potential for the two big cryptocurrencies. showing.
This weaker correlation could lead to more trading activity in the bitcoin/ether pair on major exchanges, creating new opportunities for traders to capture the relative value of the two without going through the dollar.
Or is this just an annoyance to the Bitcoin narrative, or is it actually a significant change?
A landmark new crypto rule was approved by the European Union (EU) Finance Minister on Tuesday. Her associate Laura Douglas, senior at Clifford Chance LLP, joined “First Mover” to discuss its importance. Apart from this, the cryptocurrency market remained fairly quiet, with both Bitcoin (BTC) and Ethereum (ETH) prices trading below their 20-day moving averages. 3IQ CEO Fred Pai gave his outlook on the cryptocurrency market. And LandVault CEO Samuel Huber spoke about how partnerships are forming in the Metaverse during the crypto winter.
