Blockchain

Head of Digital Assets at Goldman Sachs, Matthew McDermott, has projected a massive growth in the cryptocurrency market in 2024. McDermott shared these positive predictions in a recent interview with Fox Business, expressing much optimism in the future of digital assets. 

Goldman Exec Expects Spot ETFs To ‘Gradually’ Boost Institutional Demand For Crypto Assets

Speaking to Fox Business, McDermott has backed the continuous growth of cryptocurrencies as he foresees a rise in the institutional adoption of these assets. 

Notably, the Goldman executive shares popular sentiment with many crypto enthusiasts that the approval of a Bitcoin or Ethereum spot ETF will open up the digital asset ecosystem to more institutional investors who are weary of the market volatility attached to direct crypto investments. 

McDermott said:

One, it broadens and deepens the liquidity in the market. And why does it do that? It does that because you’re actually creating institutional products that can be traded by institutions that don’t need to touch the bare assets. And I think that, to me, that opens up the universe of the pensions, insurers, etc. 

However, McDermott has cautioned crypto enthusiasts against expecting a sudden impact of crypto spot ETFs. He believes the anticipated increased demand and price rise will be a gradual process that will occur over the course of 2024. 

The US Securities and Exchange Commission (SEC) is expected to grant approval orders to several Bitcoin spot ETF applications in the coming weeks following discussions between the regulator and multiple asset managers. Bloomberg analyst Eric Balchunas has set a potential decision window of January 8 – January 10, stating there is a 90% chance the SEC finally delivers a verdict on these various applications putting an end to the 6-months chronicle.

Asset Tokenization In 2024

In addition to potential crypto spot ETFs, McDermott also mentioned a potential increase in commercial blockchain application as another contributing factor to his projected rise in institutional demand for digital assets.

Particularly, he spoke about an improvement in existing tokenization systems, which can lead to the creation of secondary liquidity on blockchains.

He said:

When I think about tokenization, which is obviously a topic that’s kind of talked about quite extensively, I think for me next year what we’ll start to see is the development of marketplaces. So where we start to see scale adoption, particularly across the buy side in the context of investors. And that’s because we’ll start to see the emergence of secondary liquidity on chain, and that’s a key enabler. So for me, that’s one of the key developments for next year.”

At the time of writing, the entire crypto ecosystem is valued at $1.602 trillion, with a 15.09% gain in the last month. The market’s leader Bitcoin currently trades at $42,082, having declined by 1% in the past day.

The pioneer cryptocurrency, Bitcoin, has struggled to hold above the $43,000 price mark over the past few weeks. The last seven days have not been much different for the cryptocurrency, which currently trades below $42,000.

However, a popular crypto analyst on the X platform has come forward with an interesting trajectory for the price of BTC in the coming weeks. Based on his projection, investors could see the market leader trade above the psychological $50,000 level – but there is a caveat. 

BTC Price To $50,000 – But What Happens After?

In a recent post on X, prominent crypto trader Ali Martinez put forward a price prediction, stating that Bitcoin’s value could climb as high as $50,000 in the near future. The analyst came up with this projection after identifying and studying a historical pattern on the coin’s price chart on a higher timeframe. 

Martinez’s prediction is based on BTC’s price action between 2016 and 2019 on the weekly chart. According to the crypto analyst’s post, the premier cryptocurrency witnessed a major price correction – after reaching a market bottom – when it touched the 0.786 Fibonacci retracement level.

Martinez believes that current price action mirrors the Bitcoin pattern observed in the last years of the previous decade. Historical price patterns can be helpful in technical analysis and in predicting the future trajectory of a cryptocurrency.

If this history – on the Bitcoin price chart – does repeat itself, investors could see the value of BTC surge toward $50,000. However, Ali Martinez noted that the flagship cryptocurrency could come tumbling down afterward by a significant 40%.

From the current price point, Bitcoin’s journey to $50,000 would mean an almost 20% upward swing. Meanwhile, a 40% decline right after this surge could see the premier cryptocurrency return to around $30,000.

Bitcoin Price Overview

As of this writing, the value of Bitcoin stands at $41,831, representing a 1.5% price decline in the past 24 hours. This recent dip only further reflects the bearish pressure the market leader has had to face in the past week.

According to data from CoinGecko, the Bitcoin price is down by nearly 4% in the last seven days. However, the cryptocurrency has had a fairly successful December, having increased by about 10% in the last month of 2023.

BTC has had one of the best price performances this year, soaring by an outstanding 150% since January. Consequently, Bitcoin retains its spot as the largest cryptocurrency in the sector, with a market capitalization of roughly $823 billion.

LUNC, the resilient token emerging from the tumultuous aftermath of Terra’s downfall, witnessed a notable 14% downturn, mirroring a substantial legal setback delivered by a U.S. District Court.

This judicial decision favored the Securities and Exchange Commission (SEC) in their legal pursuit against Terraform Labs, the entity steering the Terra blockchain, injecting uncertainty into the fate of the beleaguered cryptocurrency.

Harking back to the SEC’s assertions in February, the once-mighty stablecoin, LUNA, now lies at the heart of the controversy that unfolded in May 2022. The SEC contends that LUNA transcended the classification of a digital dollar, deeming it a security.

Additional Pain For LUNC

Crucially, Terraform Labs allegedly neglected to register it as such. The gravity of the situation intensifies as Do Kwon, co-founder of Terraform Labs, faces accusations of orchestrating the sale of these unregistered securities, placing additional strain on the future trajectory of LUNC.

Judge Jed Rakoff’s definitive ruling echoes a harsh reality – both LUNA and MIR, another token within the Terra ecosystem, are recognized as securities. This legal stance paves the way for potential further action by the SEC against Terraform Labs, casting a shadow over LUNC’s future.

The abrupt shift in market sentiment is evident as LUNC’s Weighted Sentiment, a metric gauging market optimism, plummeted to -0.510 post-ruling. This stark transformation from bullish to bearish suggests a loss of investor confidence in the short-term prospects of the token.

Social Dominance, reflecting the attention given to LUNC, experienced a surge on December 29th, correlating with the court ruling. However, this heightened interest quickly dissipated, indicating that the initial impact was ephemeral, and traders may have swiftly incorporated the negative developments into their decision-making.

LUNC Price Analysis: Overall Downtrend With Potential For Reversal

The chart (below) confirms a downward trend over the past seven days, mirroring the bearish sentiment post-court ruling.
However, technical indicators suggest a potential for reversal:

RSI: Dipping towards the oversold zone, implying a possible price rebound.
Negative Divergence: Hints at an upcoming uptrend, though the legal uncertainty adds complexity.
EMAs: The recent 20 EMA crossover above the 50 EMA offers a bullish signal, albeit weak.

Impact Of Court Ruling:

The sharp drop on December 29th coincides with the ruling, highlighting its significant impact.
Continued bearish momentum suggests ongoing concerns about the legal and regulatory landscape.

Support And Resistance Levels:

Support: The $0.00013 area has acted as a barrier, holding price from further decline. Maintaining this level is crucial for bullish momentum.
Resistance: Breaking above the $0.00015 level could signal a stronger uptrend, but overcoming psychological resistance may be challenging.

Volume And Historical Trends:

Low volume indicates investor indecision, possibly due to the legal uncertainty.
Comparing to historical trends:

Previous support and resistance levels offer limited guidance due to the recent crash.
Past volatility patterns might not be reliable given the unique legal context.

Overall:

The technical indicators present a potential for LUNC reversal, but the court ruling casts a shadow of uncertainty. Closely monitor key support and resistance levels, watch for changes in volume, and remain cautious due to the volatile market conditions.

Featured image from Shutterstock

According to Bloomberg, Coinbase Global has recently experienced a change in leadership within its custody division. The departure of Aaron Schnarch, former CEO of Coinbase Custody, has been confirmed by a spokesperson, who also revealed that Schnarch was replaced by Rick Schonberg in August.

Per the report, the transition aligns with Coinbase’s efforts to offer services to applicants of spot Bitcoin (BTC) exchange-traded funds (ETFs).

Coinbase Affirms Readiness For Bitcoin ETF Approval

Rick Schonberg, who joined Coinbase in 2021, aims to provide experience to his new role, having previously worked at reputable financial institutions such as Goldman Sachs, State Street, and Tagomi, according to Bloomberg. 

Coinbase on the other hand, has emerged as the preferred choice for custodial services among Bitcoin ETF applicants, including industry giants like BlackRock, Franklin Templeton, and Grayscale Investments.

Custody services play a crucial role for potential managers of spot Bitcoin ETFs, as investors rely on these providers to securely safeguard their digital tokens.

Notably, a Coinbase spokesperson emphasized the company’s preparedness for ETF approval, stating to Bloomberg: 

We have extensively prepared for ETF approval. Our systems have been designed and tested to handle added trading volume, increased liquidity, and general increases in demand on our systems.

Coinbase Custody, operating as a trust company, falls under the regulatory oversight of the New York Department of Financial Services and undergoes auditing by Deloitte & Touche.

Countdown To Historic Decision

The race to obtain regulatory approval for the first ETF directly investing in the largest cryptocurrency, Bitcoin, is entering a critical phase. 

The US Securities and Exchange Commission (SEC) faces a deadline of January 10 to decide whether to approve a spot Bitcoin ETF application submitted by ARK Investment Management, led by Cathie Wood, and 21Shares, along with potentially other similar filings.

Overall, the departure of Aaron Schnarch and the subsequent appointment of Rick Schonberg within Coinbase Custody highlight the company’s strategy to the growing demand for custodial services from Bitcoin ETF applicants. 

With the potential approval of spot Bitcoin ETFs on the horizon, the industry eagerly awaits the SEC’s decision, which will have far-reaching implications for the adoption and mainstream acceptance of cryptocurrencies.

Bitcoin, the largest cryptocurrency in the market, is currently trading at $42,100, representing a 1.1% decline over the past 24 hours. 

In recent weeks, BTC’s price has been consolidating above $40,000, exhibiting sideways movement since the beginning of December. However, it has achieved a notable gain of over 11% in the last 30 days.

It remains to be seen how the price of BTC will react to the potential approval of these index funds by the largest asset managers in the world, and what other impact it will have on the overall crypto market.

Featured image from Shutterstock, chart from TradingView.com

The recovery of the overall crypto market this year has spurred a surge in the digital-asset derivatives market as institutional investors seek exposure to the crypto space. 

According to a recent Bloomberg report, the deadline for US regulators to approve or reject Bitcoin (BTC) exchange-traded funds (ETFs) has prompted traditional investors to turn to crypto options and futures, leading to unprecedented trading volumes.

Crypto Options Trading Hits Record High

Before the options expiry on Friday morning, crypto options trading volume reached a new all-time high, with options worth a notional value of $11 billion, as highlighted by Bloomberg. Of this total, Bitcoin contracts accounted for $7.7 billion, while Ethereum (ETH) options represented $3.5 billion.

Despite the expiration of many options, the impact on the major cryptocurrencies has been limited.  With its strong support floor at $42,000, Bitcoin has maintained its position for a potential uptrend once bullish momentum returns and buying pressure increases. 

Over the past 24 hours, Bitcoin has traded within the same range as the previous day, at $42,200, experiencing only a 0.4% decline. Nevertheless, Bitcoin has yet to fully recover from its 3.4% drop over the past seven days.

In contrast, ETH was hit by the expiration of options contracts. Ethereum, the second-largest cryptocurrency on the market, fell more than 2%. EHT dropped to $2,316 after hitting an annual high of $2,445 on Thursday.

However, while heightened trading activity may accompany the expiration of options, it is unlikely to impact spot market prices, according to Luuk Strijers significantly, Deribit’s chief commercial officer. 

Strijers notes that clients are rolling their positions to 2024 expiries, and additional activity is anticipated after the expiry. The focus of attention and trading activity will primarily be on the impending ETF decision, Bloomberg notes.

Surge From Traditional Asset Managers 

The cryptocurrency market has undergone a strong rally this year, with Bitcoin surging nearly 160% following a turbulent 2022 marked by industry scandals and price declines. 

The recovery has been fueled partly by the optimism surrounding the potential approval of spot Bitcoin ETFs, which would attract a broader range of investors to the asset class.

Ryan Kim, head of derivatives at digital-asset prime brokerage FalconX, highlights the growing participation from crossover macro accounts, referring to large traditional asset managers allocating a small percentage of their portfolios to cryptocurrencies and crypto-focused hedge funds.

In addition, according to Bloomberg, perpetual futures, a favored tool for leveraging crypto trades, are trading at a significant premium compared to spot prices, indicating rising demand for such products.

Overall, the surge in the cryptocurrency derivatives market, driven by options expiry and the pending decision on Bitcoin ETFs, reflects the growing interest of institutional investors in the crypto space. 

The record-breaking trading volumes and increased participation from traditional asset managers highlight the evolving landscape of digital assets. 

As the market awaits the regulatory verdict on Bitcoin ETFs, it remains to be seen how these developments will shape the future trajectory of the crypto market and its integration with traditional financial systems.

Featured image from Shutterstock, chart from TradingView.com 

The Avalanche Foundation is expanding its support of meme coins. This move could further boost the popularity of Avalanche, a low-fee and high-throughput blockchain, and even support its native coin, AVAX.

Avalanche Foundation To Support Meme Coins

Taking to X on December 29, the foundation said it would continue its Culture Catalyst initiative to encourage meme coin activity, among others, including Real-World Assets (RWAs), non-fungible tokens (NFTs), and more. This campaign, they continue, aims to foster innovation and propel the adoption of blockchains by supporting the creation of “new forms of creativity, culture, and lifestyle.”

The Avalanche Foundation believes that meme coins have carved out a significant niche in crypto, representing the collective spirit and shared interests of diverse crypto communities. By recognizing and encouraging this culture, the foundation hopes to develop and expand the Avalanche ecosystem, attracting new users.

As they resume Culture Catalyst, the foundation will start by purchasing select Avalanche-based meme coins to create a collection. The selection process will be based on several critical criteria, including the number of holders, liquidity thresholds, project maturity, principles of a fair launch, and overall social sentiment.

This move is a significant step for the Avalanche Foundation, as it indicates a growing recognition of the potential of meme coins to drive innovation and growth. It is because meme coins have become increasingly popular in recent years, often attracting large communities and generating significant trading volume. According to CoinMarketCap data on December 29, meme coins have a cumulative market cap of over $23 billion.

Will AVAX And COQ Extend Gains In 2024?

The foundation’s support for meme coins could further boost the popularity of Avalanche, as it will bring more attention to AVAX, a coin used for paying network fees. Thus far, AVAX remains in an uptrend, adding nearly 400% from October 2023 lows. Though there has been a cool-off, buyers have the upper hand. With rising demand triggered by more meme coins deploying on Avalanche, AVAX prices will likely float even higher.

One of the Avalanche-based meme coins, COQ, is among the top 10 most liquid. According to DEX Tools data, there are over 34,000 COQ holders when writing. As of December 29, Dogecoin (DOGE) is the largest and most valuable meme coin, with over $13.2 billion in market cap. However, the launch and subsequent stellar performance of COQ propelled it to command a market cap of $114 million. 

The Bitcoin Rainbow Chart has emerged as a universally used analytics tool that helps crypto investors and traders predict BTC’s ever-changing market trends and cycles. 

Bitcoin Rainbow Chart BTC Analysis

Throughout the year, the price of Bitcoin has experienced several uptrends and downsides. Starting from the last three months of 2023, BTC’S price has experienced a major surge, hitting above $35,000 in October and surging past $44,000 in December. 

With the market moving up rapidly, many crypto investors and market watchers look for various crypto analytics tools to enhance their understanding of the Bitcoin market trends. 

The Bitcoin Rainbow Chart is one of the many analytics tools available for predicting the potential prices of BTC. This color-coded chart is a long-term valuation tool for BTC that uses a logarithmic growth curve to forecast the potential price of BTC. 

Currently, according to the rainbow chart, Bitcoin is positioned around the “Accumulate” and “Still cheap” zones. This implies that the chart is showing the best timeline to purchase BTC before the selling phase begins. 

The Bitcoin Rainbow Chart simplifies BTC price predictions, helping investors identify potential BTC buying and selling opportunities. However, it’s important to note that the Bitcoin Rainbow Chart is not investment advice and does not predict the exact price of Bitcoin. 

History Of The BTC Rainbow Chart

The Bitcoin Rainbow Chart first started as a fun project created by a Reddit user, Azop to visually represent Bitcoin’s price history. However, the chart became more mainstream after a second version was developed by trader Trololo and transformed into a crypto technical analysis tool. 

The chart is designed using a color coding scheme and highlights each Bitcoin halving cycle and diverse BTC price ranges. With its seven color bands, the rainbow chart identifies strategic points to buy, sell, or hold BTC. 

The dark red band signals a maximum bubble territory, the red band indicates a robust selling phase, while orange and yellow signify FOMO intensification and HODL periods respectively. The Green band indicates a favorable buying and accumulation window and lastly, the blue color band represents a fire sale opportunity. 

While the Bitcoin Rainbow Chart does not provide financial advice, it is a widely recognized tool used by crypto traders and investors to gain a simpler understanding of BTC market movements. Ultimately, the accuracy of the chart’s predictions depends on how it is applied and in what context. 

Shibarium, the Layer-2 blockchain linked to the widely recognized meme coin Shiba Inu, is making notable strides. Recent data indicates a significant uptick in user engagement, marked by a substantial increase in both transactions and wallet growth.

The Shibariumscan explorer reveals that daily transaction volume on Shibarium has reached roughly 7.84 million, reflecting a steady climb since the beginning of the month.

This uptrend in activity has propelled the total transactions on the platform to 212 million, accompanied by the connection of over 1.3 million Shibarium wallets, signifying a growing network of users.

Shibarium’s Dynamic December: Wallet Growth Meets Fluctuating User Activity

Despite the notable growth in wallets, there has been a contrasting trend in active user numbers. While the account numbers have swelled in December, active user engagement experienced a downturn during the same period.

However, a slight rebound in active users was observed on December 27, hinting at a potential revival in participation. Particularly, Shibarium’s active users surged from a low of 1,878 as of December 23 to an high of 2,802 on the 27th.

This pattern of fluctuating user activity, juxtaposed with the consistent increase in wallet numbers, paints a complex picture of Shibarium’s current ecosystem dynamics.

Alongside Shibarium’s transactional growth, the Shiba Inu community has intensified its efforts in token incineration, aiming to reduce the circulating supply of SHIB tokens and potentially boost their value.

The burn tracker Shibburn reports a 17.59% increase in the daily burn rate, with 13.7 million SHIB tokens recently burned. So far, December has witnessed the burning of roughly 24 billion Shiba Inu tokens, underscoring the community’s commitment to reducing SHIB’s supply.

This consistent burning strategy is central to the community’s long-term goal of fostering token value growth through supply reduction.

Shiba Inu Market Resilience Amid Security Warnings

Meanwhile, Shiba Inu has thrived to continue its month-long bullishness. Despite a 1% decline in the past week, the asset currently shows an upward trajectory increasing by 0.8% in the past 24 hours, with a market price of $0.00001047, at the time of writing.

In the midst of these developments, the ShibArmy Scam Alerts account on X has raised concerns about the prevalent issue of security in the crypto domain, particularly focusing on Shibarium. The account underscores the risks posed by fraudulent projects that exploit inexperienced investors through deceptive advertising.

Emphasizing the importance of being well-informed, the ShibArmy Scam Alerts advises thorough research, including scrutinizing white papers, understanding the fundamentals of the asset, and verifying the authenticity of the development team.

In #Shibarium, part of addressing the most significant issue in crypto right now—scams—means prioritizing safety in all aspects. If we put aside the obvious rugged pulls and phishing links, let’s talk about being deceived by false advertising.

How not to be deceived? It’s by… pic.twitter.com/g1RqJDgkId

— Shibarmy Scam Alerts (@susbarium) December 29, 2023

The account also suggests examining media coverage and ensuring active, genuine community engagement on platforms like Discord and Telegram. This comprehensive approach to due diligence is crucial for navigating the crypto space safely and avoiding falling prey to sophisticated scams.

Featured image from Unspash, Chart from Tradingview

CEO of ARK Invest, Cathie Wood has shared her perspective on the approval timeline for Spot Bitcoin ETFs. She has also highlighted the significant impact the official authorization of Bitcoin ETFs would have on the price of BTC.

BTC Price Boom Predicted Following ETF Acceptance

Founder and CEO of American asset investment management firm, ARK Invest, Catherine Duddy Wood has recently appeared in an interview with Yahoo Finance. The live interview which was published via YouTube centers on Wood’s views and opinions regarding the potential approval of Spot Bitcoin ETFs and its effect on the price of BTC. 

According to the ARK Invest CEO, the price of BTC could surge substantially if the United States Securities and Exchange Commission (SEC) approves Spot Bitcoin ETFs for institutional investors. 

“What we think is going to happen here is that the SEC is going to be giving BTC, a spot bitcoin ETF, the green light for institutional investors to participate. I think a lot of institutions have been reticent before the SEC approves a spot bitcoin ETF to do very much at all in the crypto asset world,” Wood stated.

She added:

“All we need is for the trillions of dollars in institutional assets out there to allocate maybe 0.1% or 0.2% to an ETF, which will be one of the easiest ways to gain exposure and one of the most efficient ways to gain exposure to BTC. That will move the price significantly.” 

Bitcoin ETF Approval Expected In January

During the interview, Wood outlined a timeline for the approval of Spot Bitcoin ETFs, predicting the potential approval dates for January. 

“We do think it will be in January. Famous last words, don’t want to say we know anything, because we don’t. But it’s just the actions of the SEC that are leading us to that conclusion,” Wood said.

Despite the positive forecast, the ARK Invest founder also stated that if the US SEC remains undecided about Spot Bitcoin ETFs, then a BTC ETF may not be necessary. 

“We don’t want a spot bitcoin ETF to get the green light if there are any uncertainties that the SEC may have. So I think we’re answering those uncertainties one by one, each of the filers for a spot bitcoin ETF. And I think the dialogues are very positive. I think the outlook is bright for a spot bitcoin ETF,” Wood stated.

On-chain data shows the Bitcoin miners have participated in a 3,000 BTC selloff recently, something that may explain the asset’s latest pullback.

Bitcoin Miner Reserve Has Taken A Plunge Recently

As pointed out by analyst Ali in a new post on X, the BTC miners have participated in some selling recently. The indicator of interest here is the “miner reserve,” which keeps track of the total amount of Bitcoin sitting in the wallets of all miners.

When the value of this metric goes up, it means that the miners are receiving a net number of coins in their addresses right now. Such a trend suggests that these chain validators are choosing to accumulate the asset currently, which can naturally have bullish effects on the price.

On the other hand, a decline implies that this cohort is transferring coins out of their wallets at the moment. Generally, the miners make such outflows when they are looking to sell their BTC, so this kind of trend can have bearish implications for the cryptocurrency.

Now, here is a chart that shows the trend in the Bitcoin miner reserve over the past month:

As displayed in the above graph, the Bitcoin miner reserve has registered a sharp drop during the past couple of days. During this withdrawal spree, these chain validators transferred out more than 3,000 BTC from their wallets, worth around $128 million at the current exchange rate.

Bitcoin had recovered to the $43,800 level earlier after news had come out about Microstrategy completing another substantial purchase. As the miners made these outflows, though, the cryptocurrency witnessed a drawdown towards the $42,000 mark.

Given the timing, it would appear possible that the miners had made these transfers to cash in on the recovery and this extra selling pressure may have contributed to the decline that the asset ended up seeing.

Miners are a group that has to pay constant operating costs in the form of electricity bills, so they regularly sell some of the BTC they mine and earn from transaction fees in order to cover these expenses.

More often not, though, the miners only participate in relatively low levels of selling, which is readily absorbed by the market and the cryptocurrency doesn’t feel too much impact

This time around, though, these chain validators have sold a sizeable amount inside a narrow window, which is potentially why Bitcoin has appeared to have been affected.

In some other news, the market intelligence platform IntoTheBlock has revealed the average holding time on the Bitcoin blockchain and how it compares against other networks.

As is visible above, Bitcoin holders carry their coins for 4.3 years on average, which is far greater than what Cardano (ADA) and Avalanche (AVAX) blockchains observe.

While miners don’t tend to HODL because of their running costs, it would appear that the normal investors on the BTC network are more than making up for it by holding for very extended periods.

BTC Price

The market doesn’t seem to be too discouraged after the drop due to the selling pressure from the miners, as Bitcoin is now once again making a recovery push. So far, BTC has climbed back to the $42,900 level.