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Exploring the Dwindling Bitcoin Trading Volume: A Detailed Analysis

Brandon Foster on September 14, 2023

Intriguingly Subdued Markets: Examining Bitcoin’s Trading Volume and Its Implications for Investors

Bitcoin’s Trading Volume Reaches Historic Lows: A Closer Look

Amidst the ever-evolving landscape of cryptocurrency markets, an interesting phenomenon has emerged — the trading volume of Bitcoin has plunged to its lowest point in over four years. This drop is emblematic of a broader trend wherein investors seem to be biding their time, eagerly awaiting catalysts that would reignite their enthusiasm for entering the market.

Analyzing CryptoQuant Data: Unveiling the Extent of the Decline

A meticulous analysis of CryptoQuant data pertaining to both spot and derivatives exchanges offers a comprehensive understanding of this significant development. The cumulative volume of Bitcoin held across exchanges experienced a noteworthy decline earlier this month, marking its most subdued level since the year 2018. Moreover, this decline in volume has proven to be resilient, showing limited signs of recovery in subsequent periods.

Quantifying the Retreat: Figures Don’t Lie

As of August 26, the aggregate trading volume of Bitcoin across all exchanges stood at 129,307 BTC, a statistic ascertained by CryptoQuant. Remarkably, this figure had plummeted to 112,317 BTC on August 12, representing its lowest point since November 10, 2018. When viewed in the context of its zenith in March, which saw a trading volume of 3.5 million BTC, the current volume exhibits a stark decrease of approximately 94%.

Bear Markets and Retail Investors: A Confluence of Factors

The prevailing trend of diminishing trading volumes during bear markets is not without its reasons. Julio Moreno, the Head of Research at CryptoQuant, aptly pointed out that retail investors often exit the market during such periods. This pattern was notably observed in 2022 across several exchanges. However, Moreno suggests that as the market transitions into a bullish phase, there is the potential for trading volume to regain its upward trajectory.

Evaluating the Current Landscape: Implications and Reflections

Despite the apparent stagnation in trading activity, Bitcoin’s price performance remains intriguingly robust. With a year-to-date surge of 57%, Bitcoin is valued at approximately $26,100, as per data from Coin Metrics. This prompts us to explore the factors that have led to this juxtaposition of subdued trading and impressive price gains.

Bearish Summers and Regulatory Hurdles: Beyond Seasonal Trends

The subdued atmosphere experienced by Bitcoin traders this summer is not solely attributable to seasonal trends. The regulatory crackdown on cryptocurrencies in the United States, coupled with the resolution of the banking crisis in May, exerted substantial influence over the trajectory of Bitcoin’s market activity. These events collectively led to the retreat of market makers and traders, whose absence has been felt profoundly.

Weathering Storms and Analyzing Reactions: Investor Resilience in the Face of Adversity

Even a significant sell-off on August 17, characterized as the most substantial single-day drop since the peak of the FTX fallout in November, failed to prompt sustained market turbulence. Interestingly, long-term investors have displayed remarkable resilience in the face of recent market vulnerabilities.

Anticipating Catalysts: The Key to Market Revival

Bernstein analyst Gautam Chhugani attributes the prevailing market quietude to the anticipation of a game-changing catalyst. While the market isn’t inherently bearish, participants remain somewhat indifferent to trading as they await decisive market-moving events. Specifically, attention is focused on potential decisions regarding the numerous spot Bitcoin ETF applications awaiting approval by the Securities and Exchange Commission.

Embracing the Long Game: Strategies for Investors

Chhugani’s perspective encourages a patient approach, emphasizing the value of remaining steadfast during market cycles. The forthcoming Bitcoin halving, anticipated to occur in the spring of 2024, could potentially be the impetus for renewed market vigor. This notion is endorsed by Cantor Fitzgerald, which underscores the importance of sustained commitment in a rapidly evolving landscape.

A Synthesis of Trends and Prospects

As the Bitcoin market navigates its way through these intriguing dynamics, it becomes evident that the current trading volume landscape offers insights into investor sentiment and anticipation. While regulatory challenges and market reticence cast their shadows, the resilience of long-term investors and the potential for transformative catalysts continue to shape the narrative. As the future unfolds, it will be fascinating to witness how these factors interact and influence the trajectory of Bitcoin’s journey.

Bitcoin mining claims sparks response from CH4 Capital co-founder

Jerry Cooper on September 5, 2023

Bitcoin — Bitcoin mining has significant environmental implications due to its energy-intensive nature. The process involves solving complex mathematical problems, requiring massive computational power and, consequently, consuming enormous amounts of electricity. Miners worldwide compete to validate transactions and secure the network, which often leads to the use of fossil fuel-based power sources, contributing to greenhouse gas emissions.

Moreover, the mining hardware itself requires substantial resources, including rare metals and electronic components that are environmentally costly to extract and produce. The cumulative effect of these factors results in a substantial carbon footprint and exacerbates concerns about climate change. Addressing the environmental impact of Bitcoin mining necessitates exploring alternative energy sources, improving energy efficiency, and transitioning towards more sustainable mining practices.

However, there have been disputes surrounding such claims, with an expert saying that Bitcoin mining would instead clean up the atmosphere.

Urge to denounce

Recently, an ESG-focused fund manager disputed claims from the GreenpeaceUSA non-profit organization that Bitcoin mining is a major contributor to pollution and a harm to society.

Last Tuesday, a report was published wherein GreenpeaceUSA urged Bitcoin-friendly financial services companies (BlackRock, Fidelity, and JPMorgan, to name a few) to denounce Bitcoin’s environmental destruction. Instead, they urged for them to change to a “cleaner protocol” code that removes the mining industry.

“All of these companies have connections to Bitcoin and have failed to take meaningful action to solve the problem despite making climate and sustainability pledges,” wrote GreenpeaceUSA.

Defending Bitcoin mining

However, CH4 Capital co-founder Daniel Batten rejected such views. He argued that Bitcoin is more helpful in the healing of the environment, rather than harming it.

“There is a growing weight of evidence from those most qualified to make the assessment to suggest that Bitcoin mining helps build out the renewable grid,” Batten wrote in a formal rebuttal.

Batten also cited Electric Reliability Council of Texas former interim CEO Brad Jones, who previously spoke about Bitcoin’s ability to help renewable energy operators become more profitable, fundable, and stable. The CH4 Capital co-founder also said that many facts and figures used by GreenpeaceUSA citing how harmful Bitcoin was to the environment were false and misleading.

According to Batten, GreenpeaceUSA uses unsubstantiated fears about the possibilities instead of using evidence. He slammed the report, saying it was filled with emotive language. For example, GreenpeaceUSA said the mining industry is mainly powered by coal. However, Batten noted that there are 41 known sustainably powered mining operations with only one operation maintaining coal-related products.

The fears

Bitcoin’s impact on the environment is a growing concern due to its resource-intensive mining process. The energy requirements for mining Bitcoin are immense, leading to a significant demand for electricity. Unfortunately, this often translates into reliance on fossil fuels, contributing to carbon emissions and exacerbating climate change concerns. Additionally, the mining hardware itself necessitates the extraction of rare metals and other resources, further straining the environment.

These combined factors result in a substantial ecological footprint associated with Bitcoin mining. Addressing these environmental fears requires exploring alternative energy sources, improving energy efficiency in mining operations, and adopting more sustainable practices to mitigate the environmental consequences of Bitcoin’s popularity.

Mining today

The CH4 Capital co-founder used presented data to show how Bitcoin emissions are falling over time compared to GreenpeaceUSA simply claiming that Bitcoin’s environmental destruction would escalate if left to its devices.

“Emissions are falling despite rising hashrate due to decimation of mining in Kazakhstan and other coal-based grids,” Batten explained.

He said that miners have relocated to more sustainably powered grids, citing Texas as an example. In addition, Batten cited individual companies have shifted their facilities from coal-based standards to wind-based standards and flare-gas mining that decreases the overall net emissions of the Bitcoin network.

CH4 Capital specifically invests in companies that strive to mine Bitcoin with purified landfill gas that might have been burned, polluting the atmosphere with methane emission. As a result, their process creates a win-win situation for the environment and the company’s bottom line.

“Our $400 million fund will have sufficient dry powder to finance the Bitcoin network, abating more emissions than it’s creating, which can end ESG FUD, the major remaining barrier for both retail and institutional adoption,” said Batten.

Reception to GreenpeaceUSA

The GreenpeaceUSA campaign started in 2022 when it received $5 million to shed light on the perils of the mining industry.

As a result, the Bitcoin community has been unwelcoming to the organization. Regarding their campaign and backer, Chris Larsen of Ripple, Batten refused to comment further.

“I’ll let people make up their own mind about the intentions of a chair of another altcoin giving a large sum of money to help an NGO attack a rival form of cryptocurrency in Bitcoin,” said Batten.

Bitcoin receives a 5% boost

Alice Blake on July 3, 2023

Bitcoin — Most cryptocurrencies have moved in an unexpected and less steady manner during the last year.

The failure of multiple stablecoins contributed significantly to the crypto market’s downturn, and the November collapse of FTX pulled the sector back from its sluggish comeback.

Since then, the crypto market has gained some stability, and this week has brought more good news.

On Monday, the price of Bitcoin surged as banking institutions validated the popular cryptocurrency.

Bitcoin increased by more than 5% to $28,0002.18 according to Coin Metrics.

The gain brought the cryptocurrency to its highest level since early May.

Sympathy for crypto

Since late last week, the response to cryptocurrencies has been overwhelmingly favorable.

Some of the feelings may be traced back to a BlackRock filing in which it applied for the first-ever spot Bitcoin ETF in the United States.

BlackRock is one of the leading suppliers of investment, advising, and risk management solutions, making it one of the most trustworthy businesses to invest in cryptocurrency.

The move comes after the Securities and Exchange Commission sued two prominent cryptocurrency exchanges, Binance and Coinbase.

As a result, many people are wondering about the timing of BlackRock’s decision, particularly because Coinbase is expected to be its crypto custody partner.

A new exchange

On Tuesday, Bitcoin received another boost.

EDX Markets, a new cryptocurrency exchange, said that it has been operational for many weeks, acting as an alternate trading platform for Bitcoin and Ether.

EDX is supported by financial behemoths Charles Schwab, Citadel Securities, and Fidelity Digital Assets.

CEO Jamil Nazarali made the announcement on LinkedIn, writing:

“I am proud to announce that EDX Markets (EDX) has successfully launched our digital asset market and completed an investment round with new equity partners.”

“EDX’s official launch allows our outstanding team to bring crypto the same values and standards of competition, transparency, fairness, and safety that investors in traditional assets expect and enjoy.”

EDX is an unusual platform in that it does not have custody of its clients’ digital assets.

To acquire and sell crypto assets, they must go via financial intermediaries, similar to trading on the Nasdaq or the New York Stock Exchange.

The strategy is preferred by regulators, according to Nazarali, since it emphasizes the separation of the broker transaction function and the exchange function.

“What we’re seeing is that increasingly, investors want to trade through their trusted intermediaries, and that’s especially true post-FTX, which was supposed to be the leader in the digital market. If you can’t trust them, who can you trust?”

“So people are falling back on the firms that have been around for a really long time and that have really stood the test of time, and that’s a really important tailwind for us.”

Because of the ambiguous restrictions in the United States, EDX now only provides four cryptocurrencies:

Bitcoin (BTC)
Ethereum (ETH)
Bitcoin (LITE)
Bitcoin (BCH)

“We have a limited set of tokens because until there is more regulatory clarity, we don’t want to trade something that’s potentially a security,” Nazarali explained.

“Regulators really like that we don’t take that risk.”

Other institutions

Fidelity has been keeping up with crypto developments since 2014.

To maintain its interest in the crypto area, the corporation took the following steps a few years ago:

Fidelity Crypto, a commission-free retail investing app, was launched.
Access to cryptocurrencies was made available to 401(k) holders.

Several financial institutions are keen to demonstrate their enthusiasm for blockchain technology, particularly how it may upgrade outdated financial infrastructure.

However, only a handful are as vociferous about their opinions on cryptocurrency investing.

However, with large companies such as BlackRock and Fidelity highlighting their crypto pledges, investors were more hopeful on Tuesday.

They were especially hoping that some of the negative perceptions of the crypto industry’s hazards would dissipate, as several investors thought they had encountered a mental hurdle while purchasing Bitcoin.

In the meanwhile, Bitcoin has struggled to break out of its current trading range.

Regardless, they have yet to fall far below $25,000.

Bitcoin’s monthly gains crossed into the green zone on Tuesday, increasing by 69% in 2023.

A Glimpse Into the World of Altcoins

Alice Blake on October 19, 2022

Bitcoin was the first digital currency to be created that existed completely in the virtual space with no tangible presence. Since all Bitcoin transactions are secured cryptographically, it became the first cryptocurrency to be popular among the masses all around the globe. Also, the decentralized blockchain technology on which Bitcoin is based was one of the major factors that made it different from fiat currency. Check out this link https://www.chesworkshop.org/

Though this digital currency received a lukewarm response on the global scene due to a variety of factors, the main one being that as with all new entities, people were skeptical about its survival in the years to come. However, there were many innovators like Satoshi Nakamoto who had a different concept of what an ideal financial market must be but in the absence of a reference point could not proceed with their ideas.

Bitcoin provided them with that platform and also became a source from where the idea of bigger and better versions of cryptocurrencies originated. Bitcoin is considered the pioneer in the world of cryptocurrency that has over the years carved a niche for itself. Since then, thousands of developers have created crypto coins, and since most of them have based themselves on the original cryptocurrency, other cryptocurrencies have been introduced as an alternative to Bitcoins, they are collectively referred to as altcoins.

Meaning of altcoin

The word altcoin is a combination of two separate words. While alt is derived from the term alternative, coin refers to all tokens and cryptocurrencies besides Bitcoin. However, some cryptocurrency proponents view Ethereum as an independent cryptocurrency just like Bitcoin and not as a part of the altcoins. The reason for their doing so is that most cryptocurrencies have their source in the blockchain of either Bitcoin or Ethereum from where they have forked to create their own identity as a separate coin.

The first altcoin

Just two years after the introduction of Bitcoin, its first alternative, Namecoin was launched in 2011. It was founded on the same Bitcoin code. It also capped the maximum number of coins to 21 million and employed the same algorithm of SHA-256. However, the coin about which people know more as the first altcoin is Litecoin which is still in circulation and currently is the 22^nd most popular altcoin based on the market cap rank.

Today, the total number of altcoins in the crypto market is believed to be above 20,000. Almost every day, a new coin is circulated in the market. However, while a majority of them fail to make their presence felt and fizzle out soon after their launch, quite a few coins have withstood the test of time and established themselves as having the potential for being profitable assets.

Types of altcoins

Stablecoins

As all cryptocurrencies are highly volatile leading to erratic and frequent fluctuations in their prices, there was a need for a coin that addressed this problem that the other coins faced. So, stablecoins were created. As the name suggests, they are relatively stable compared to other coins as their value is pegged to a fiat currency or a commodity.

Payment tokens

They are designed to be used as a mode of payment in exchange for goods and services and are similar to the use of a currency that is used in a financial transaction between two parties.

Security tokens

Assets in the stock market are converted into tokens of the same value that investors can invest in. These security tokens also hold a stable value in every circumstance and also do not get affected by exterior factors like that of inflation.

Utility tokens

They have multiple utilities within a network such as payment of network fees, buying goods and services, and redeeming bonus points.

Meme coins

They are a take-off on a meme and have gained prominence lately due to the hype created by Elon Musk’s support for dogecoin.

Governance tokens

These token owners have certain privileges that enable them to authorize changes in their governance protocols.

The most popular altcoins today

Ethereum
Cardano
Binance coin
Apecoin
Uniswap
XRP
Aave
Polygon

Altcoins are available at the crypto exchanges and crypto trading apps such as https://btcrevolution.io/ and are ideal for those investors wanting to diversify their portfolios.

Conclusion

Though Bitcoin has dominated the crypto market and no altcoin has seen the kind of success that has been witnessed in the case of Bitcoin, several altcoins are performing exceedingly well and are potentially profitable ventures for the investors.

EcoFi: The Future Decentralized Finance

Alice Blake on October 29, 2020

EcoFi is an open-source, permissionless, and censorship-resistant protocol built to power safe and responsible innovation in the Decentralized Finance (DeFi) space.

The EcoFi team says the platform will fundamentally change the face of DeFi as we know it. “Blockchain makes it possible for technologically demonstrable scarcity in the form of digital assets. Standing at the forefront of this digital evolution is EcoFi, and at the center of DeFI innovation stands ECO, driving true value back to the participants who prop this industry up.”

The world of financial technology is rapidly undergoing a revolutionary change. Today, DeFi represents the next natural step in the evolution of the cryptocurrency ecosystem, serving a marketplace outside of centralized exchanges. However, it has created a boom and bust economy where projects surge with popularity only to fizzle out after uncertainty sets, or when development teams go dormant.DAO GovernanceDEX

EcoFi seeks to put an end to this cycle by creating a DeFi protocol built to reward community strength and participation.

Ecofi will be one of the few Defi protocols built to withstand the upcoming bull run’s volatility and flourish in the ensuing bear run. The EcoFi’s team has a dynamic roadmap that will include staking, yield farming, unique NFT’s, and DAO Governance of EcoFi development to ensure lasting value.

EcoFi’s unique economic model hinges on the principles of staking and DeFi yield farming paired with an exclusive NFT marketplace. EcoFi will deliver this via the platform’s utility token, $ECO, and farmable $SPRT tokens that will drive digital commerce.

EcoFi will host an exclusive marketplace of NFTs of various tiers, that can be acquired by way of ECO and SPRT tokens. For any ECO tokens spent on an NFT 50% will be burned while the other goes back to the EcoFi address to be distributed based on platform maintenance requirements.

“In a world full of Meme Coins and projects lacking legitimacy, EcoFi is engineering true utility with a long-term vision for platform growth, and value for holders of $ECO tokens.”

EcoFi is an open-source decentralized technology platform, built to facilitate the growth and evolution of the DeFi marketplace on the Ethereum blockchain. EcoFi’s unique and innovative use of NFT assets, physical, and digital rewards, as well as liquidity pairs and yield farming will help to transform the future of the financial ECOsystem.

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