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Cryptocurrency

Bitcoin could potentially become superior to cash

BTC holds a maximum supply of about 21 million digital coins.

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dollars, Bitcoin has halved, what happens next?, Naira should watch out; Nigeria leads in the peer to peer use of Bitcoin than all African countries combined

MicroStrategy, a publicly traded company in the US valued at over $1.2 billion, disclosed via an official statement that it would be adopting the world’s most valuable crypto as a “primary treasury reserve asset”.

“Since its inception over a decade ago, Bitcoin has emerged as a significant addition to the global financial system, with characteristics that are useful to both individuals and institutions. MicroStrategy has recognized Bitcoin as a legitimate investment asset that can be superior to cash and accordingly has made Bitcoin the principal holding in its treasury reserve strategy,” MicroStrategy CEO, Michael J. Saylor said. He also acknowledged that Bitcoin could potentially become superior to cash.

Data from Coin360 showed the flagship crypto-asset was trading above $11,700 with a market valuation above $216 billion and a daily trading volume of about $9.6 billion. This was as at the time this report was being drafted.

Why Bitcoin might be rising

What’s driving the most valuable crypto and its usage as an investment asset lately?

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Well, many financial experts believe the sudden rise of crypto assets’ value might be due to the weakness in the US dollar.

The American dollar has fallen in recent months, on expectations that the Federal Reserve will keep interest rates near zero for the long term as a result of the financial disruption caused by the deadly COVID-19 pandemic.

Quick fact: BTC holds a maximum supply of about 21 million digital coins of which there are about 18.5 million in circulation, while over 4 million BTCs have already been lost forever. These show that its definite supply protects it asset against value dilution.

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Recall that Nairametrics earlier gave valuable insights into why Bitcoin is now the most preferred asset to own among institutional investors.

Changpeng Zhao, the CEO of Binance, on his Twitter feed commented on the reasons companies are investing in cryptos. He said:

“Smart publicly listed company buys $250,000,000 worth of bitcoin, as a safe haven asset. Stimulus money flowing from Wall Street into bitcoin. Are you in front of or behind them?”

Olumide Adesina is a French-born Nigerian. He is a Certified Investment Trader, with more than 15 years of working expertise in Investment Trading. Member of the Chartered Financial Analyst Society. Behavioral Finance, Duke University. You can follow Olumide on twitter @tokunboadesina or email [email protected]

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Cryptocurrency

Unknown entity transfers $166 million worth of Bitcoins

BTC whale moved 15,987 BTC in block  649,777 estimated to be worth about $ 166 million.

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Unknown entity transfers $166 million worth of Bitcoins

The number of transactions done by large entities in the world’s most important crypto market is on the rise.

Data obtained from Bitcoin Block Bot, a crypto analytic tracker, revealed that a BTC whale moved 15,987 BTC in block  649,777, estimated to be worth about $166 million, recently.

READ: Bitcoin whale transfers 11,230 BTC worth $116 million

 

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BTC whales have been moving large stacks of BTCs lately, triggered by the third BTC halving that occurred some months ago.

Much of the recent increase can be attributed to wealthy entities withdrawing their BTCs from crypto exchanges. Apparently, this is not new wealth; rather, it represents a change in the way Bitcoin whales are choosing to hold their coins.

READ: Buying signs: Ethereum whales increase their Ether holdings by 84%

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From a macro level, the increase in the number of these large entities can be considered bullish.

At the time this report was drafted, Bitcoin was still trading around the $10,500 support levels, as investors have kept buying BTC at its support levels.

Explore the Nairametrics Research Website for Economic and Financial Data

Quick fact: At the BTC market, investors or traders who own large amounts of bitcoins are typically known as Bitcoin whales. This means that a BTC whale would be an individual or business entity (with a single Bitcoin address) owning around 1000 Bitcoins or more.

As BTC whales accumulate BTCs, Bitcoin’s circulating supply reduces, and this can weaken any bearish trend bitcoin finds itself in.

READ: Bullish Signs: 2.6 million Bitcoins are being held on crypto exchanges

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Meaning that over time, it’s possible that as BTC approaches its fixed supply of 21 million, the price of BTC will go up, with BTC’s present demand factored in.

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Cryptocurrency

Ethereum’s investors gain 9% in 1 day

Ether traded at $348.85 with a daily trading volume of $12,728,832,627.

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Number of contract calls on Ethereum rises by 300%

The second most valuable crypto is on a strong bullish run, just a few days after dropping momentarily, as the U.S dollar hit a rebound and COVID-19 cases rise.

What we know: At the time this report was drafted, Ether traded at $348.85 with a daily trading volume of $12,728,832,627. ETH price is up 9.1% in the last 24 hours. It has a circulating supply of 110 million coins and a max supply of ∞ coins.

READ: Buhari to finally send Petroleum Industry Bill to National Assembly next week

Taking a look at its price action, Ether is sitting in an interesting price range, where the most polarization has historically unfolded (between the $200 and $300 levels) during its five-year history. A close above $350 in the near future would likely trigger more upsides.

Quick fact: Ethereum is a global, open-source platform for decentralized applications. In other words, the vision is to create a world computer from which anyone can build applications in a decentralized manner, while all states and data are distributed and publicly accessible.

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READ:  Ethereum whale transfers $78 million worth of Cryptos

On Ethereum, all transactions and smart contract executions require a small fee to be paid, which is called Gas. In technical terms, Gas refers to the unit of measure on the amount of computational effort required to execute an operation or a smart contract.

The Ethereum network is presently close to reaching its technical limits, as DeFi and Tether are essentially responsible for as many transactions as the network can handle at the moment.

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Cryptocurrency

European Commission set to regulate Cryptos

The European Commission hopes to develop a framework that will support the digitization of assets through tokenization.

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IMF calls crypto "special currency" and educates the public, Crypto: Why investors are rushing to DeFi assets, total market capitalization of cryptocurrencies, Crypto, Whales move 100,000,000 Tether, USDT in less than 24 hours

The European Commission has designed a new Digital Finance framework including Digital Finance and Retail Payments Strategies, and legislative proposals on crypto-assets and digital resilience.

This was disclosed in a statement issued by the Commission on Thursday.

What it means; The European Commission is paying special attention to developing a regulatory framework that will support the digitization of assets through tokenization and also smart contracts.

READ: Apple’s €14.3 billion payment could have consequences

Why is it happening now? It plans to give investors, consumers, traders choice and opportunities in modern payments and financial services while at the same time ensuring consumer protection and financial stability.

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Valdis Dombrovskis, Executive Vice-President for an Economy that Works for People, said: “The future of finance is digital. We saw during the lockdown how people were able to get access to financial services thanks to digital technologies such as online banking and fintech solutions. Technology has much more to offer consumers and businesses and we should embrace the digital transformation proactively while mitigating any potential risks.”

READ: CBN grants Greenwich Trust Limited operational license for merchant banking

What the European Commission plans to regulate include;

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  • Crypto-assets qualifying as “financial instruments” under the Markets in Financial Instruments Directive (e.g.: tokenized equities or tokenized bonds) have already in the past been subject to EU securities markets legislation.
  • Crypto-assets that do not qualify as “financial instruments” such as utility tokens or payment tokens, the Commission on 24 September proposed a specific new framework that would replace all other EU rules and national rules currently governing the issuance, trading, and storing of such crypto-assets.
  • This Markets in Crypto-Assets Regulation – MiCA – will support innovation while protecting consumers and the integrity of crypto-currency exchanges (no insider trading, front running, etc).
  • The proposed regulation covers not only entities issuing crypto-assets but also firms providing services around these crypto-assets such as and firms operating digital wallets, as well as cryptocurrency exchanges.

READ: Why BTC is the next big thing?

Recall Nairametrics a week ago broke the news on Nigeria’s Securities and Exchange Commission (SEC), proposing a new set of rules that will regulate Crypto-token or Crypto-coin investments when the character of the investments qualifies as securities transactions.

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