Blockchain

XRP is one of the top gainers in the last 24 hours. As to why the crypto token is up, a popular crypto sleuth has some answers, as he recently revealed a significant move made by Ripple. This revelation also has the possibility of ending talks that XRP’s price is being manipulated by Ripple, considering that the crypto firm has so far shown that it has XRP’s best interest at heart.

Ripple Allegedly Buys Back Around 700 Million XRP

In a post on his X (formerly Twitter) platform, crypto sleuth Mr. Huber mentioned that Ripple bought back around 700 million XRP from the open market. According to him, Ripple usually does this to keep the XRP markets stable and liquid. This endeavor could explain why the token’s price has suddenly picked up. 

The XRP price has underperformed in recent times, with many speculating why this could be happening. Some simply stated that the price was manipulated as there was no other logical reason to explain the underperformance, especially considering that other altcoins were enjoying significant gains. 

However, Mr. Huber had another plausible explanation for this decline as he stated that it could be one of Ripple’s ODL customers selling their XRP tokens on the open market. It had previously been reported that Ripple’s XRP sales to these ODL customers do not impact prices on exchanges. However, it does when these customers, in turn, start to sell these XRP tokens to retail investors. 

Therefore, noticing the trend of the XRP sales from ODL customers, Ripple could have bought back these XRP tokens in order to stabilize the XRP price. It is worth mentioning that Mr. Huber seems to have reached his conclusion of a massive buyback due to the decline in XRP’s circulating supply. He asserted that Ripple’s holdings are not calculated in the circulating supply. 

XRP Price Underperformance Is Concerning

Before his revelation about Ripple’s massive buyback, Mr. Huber had raised concern about XRP’s worrisome price action. He noted that the XRP price had “lost literally” all the gains it made against the broader crypto market following Judge Analisa Torres’ ruling. The Judge had ruled that the crypto token wasn’t a security in itself. 

Many had predicted that this legal clarity was going to help boost XRP’s price, and it actually did in the weeks after the ruling. However, the XRP price has been on a notable decline since posting those gains. It has even become concerning ever since the broader crypto market picked up as many continue to wonder could be the reason for XRP’s rather relatively tepid movement. 

At the time of writing, XRP is trading at around $0.69, up over 7% in the last 24 hours, according to data from CoinMarketCap. 

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Decentralized Autonomous Organizations (DAOs) represent a revolutionary concept in the blockchain and crypto world, reshaping how we think about governance and collaborative decision-making. This article dives deep into the world of DAOs, providing a comprehensive understanding of ‘What is a DAO’, their meaning, mechanics, and significance in the crypto ecosystem. You’ll also explore the intriguing history of DAOs, including insights into Nick Szabo‘s pioneering role in their invention.

What Is A DAO?

A Decentralized Autonomous Organization (DAO) is an innovative organizational structure that operates on blockchain technology, embodying principles of decentralization, autonomy, and consensus-driven governance. At its core, a DAO is an entity without central leadership, governed by a set of rules encoded in smart contracts. These contracts, running on blockchain platforms such as Ethereum, automate decision-making and enforce the rules of the organization.

Key to understanding ‘what is a DAO‘ is grasping its reliance on blockchain technology. DAOs utilize smart contracts to create a transparent and incorruptible framework for organizational operation. These contracts are programmed to execute automatically when certain conditions are met, ensuring that operations are not only transparent but also free from human error or manipulation.

DAOs fundamentally alter traditional governance structures by enabling token holders to vote on proposals directly, thereby democratizing decision-making processes. This contrasts sharply with traditional organizations where decisions are often made by a select few at the top. Every token holder can have a say proportional to their stake, aligning the interests of the organization with those of its members.

The concept of DAOs gained significant attention following the launch of projects like MakerDAO and The DAO. MakerDAO, for instance, is a decentralized lending platform that allows users to borrow and lend cryptocurrencies. The DAO, one of the earliest examples, was a venture capital fund without a traditional management structure, though it faced challenges that highlighted the need for rigorous security protocols in DAOs.

In Short: DAO Meaning And DAO Definition

DAO Meaning: A Decentralized Autonomous Organization (DAO) is a novel form of organization governed by digital rules and operated on a blockchain. The term captures the essence of a system where organizational decisions and protocols are encoded in smart contracts, ensuring operations without centralized authority. DAOs epitomize a shift towards decentralized decision-making, leveraging blockchain technology to facilitate transparent, autonomous, and democratic governance processes.

DAO Definition: DAOs are defined as entities where governance and decision-making are conducted by a collective of stakeholders rather than centralized leadership. These stakeholders typically hold tokens or digital assets that grant them voting rights within the organization.

The defining characteristic of a DAO is its reliance on smart contracts to automate administrative functions and enforce the rules set forth by its members. This automation not only minimizes the need for intermediaries but also ensures that the organization’s operations are immutable, transparent, and aligned with the interests of its token holders. DAOs, therefore, redefine organizational management by embedding trust, integrity, and collective intelligence at their core.

The Mechanics Of Decentralized Autonomous Organizations

The mechanics of Decentralized Autonomous Organizations (DAOs) represent a paradigm shift in how we conceive and execute organizational structure and governance. Rooted in blockchain technology, DAOs offer a framework for orchestrating collective action and decision-making in a decentralized, transparent, and automated manner. This approach challenges traditional hierarchical models, providing a blueprint for a more democratic and equitable form of organizational governance.

How DAOs Work

DAOs operate on a blend of technological innovation and organizational principles. The foundation of a DAO is its smart contract, which resides on a blockchain platform, most commonly Ethereum. These contracts are self-executing and contain the rules of the organization. Once deployed, only the consensus of the organization’s members can alter these contracts, guaranteeing immutability and transparency.

The process initiates with setting up a DAO by deploying smart contracts that define the organization’s rules. This includes the decision-making process, fund management, and member participation guidelines. Typically, participation in a DAO is token-based, with members holding tokens that denote their voting rights. The more tokens a member holds, the greater their influence in decision-making processes.

Voting in a DAO is a critical aspect. Members propose changes or actions, and these proposals are put to a vote. The smart contract automatically executes the decision based on the outcome of the vote, ensuring that the process is transparent and tamper-proof. This structure allows for a decentralized governance model, where no single entity has control over the organization, and decisions are made collectively by its members.

The Unique Characteristics Of DAO Crypto

DAO crypto refers to the use of cryptocurrency within DAOs for governance and transactional purposes. This aspect of DAOs presents several unique characteristics:

Token-Based Governance: In DAOs, governance is primarily exercised through tokens. These tokens are not just a currency but a means of participating in the decision-making process. They can represent voting power, membership rights, or even a share in the DAO’s profits.
Decentralization: DAOs function on a decentralized model, diverging from traditional organizations. Without CEOs or boards, the community collectively makes decisions. Blockchain technology facilitates this decentralization, preventing any single point of failure or control from compromising the organization.
Transparency and Immutability: DAOs record all transactions and decisions on the blockchain, ensuring unmatched transparency. The immutable nature of these records means that once a decision is made and logged, it cannot be changed, fostering a trustless environment for member interaction.
Automation And Efficiency: The use of smart contracts in DAOs automates various processes, from governance to financial transactions. This automation reduces the need for intermediaries, cuts down on bureaucratic overhead, and increases efficiency.
Global Participation: DAOs operate on the internet, enabling anyone, regardless of location, to participate. This global reach expands the potential for innovation and collaboration, transcending geographical and political boundaries.

The combination of these characteristics makes DAO crypto a powerful tool for creating and managing decentralized, transparent, and efficient organizations, poised to revolutionize how we think about and participate in collective decision-making and governance.

The Evolution Of DAOs

The concept and evolution of Decentralized Autonomous Organizations (DAOs) mark a significant milestone in the realm of digital governance and blockchain technology. The beginning can be traced back into the 1990s, even before Bitcoin and blockchain existed.

History: Nick Szabo Invented DAOs

The historical roots of DAOs can be traced back to the visionary ideas of Nick Szabo, a pioneering cryptographer and computer scientist. Szabo, who coined the term ‘smart contracts’ in the 1990s, laid the foundational concepts that would eventually lead to the creation of DAOs.

Szabo is credited with pioneering smart contracts in a 1996 paper. Remarkably, his ideas also influenced Bitcoin’s development. In 1998, Szabo created BitGold, considered by some as a precursor to Bitcoin.

His vision of automating contract and transaction protocols on a digital platform paved the way for the first DAOs. Although Szabo himself did not create a DAO, his work on smart contracts and digital currency greatly influenced their development. The principle of decentralized control and automation in DAOs is a direct extension of Szabo’s foresight in using blockchain technology for more than just creating digital currency.

Most Famous Decentralized Autonomous Organizations

Over the years, several DAOs have gained prominence, showcasing the potential and diversity of this organizational form. Some of the most notable DAOs include:

The DAO

The DAO, also known as Genesis DAO, stands as a landmark in the history of decentralized organizations. Launched in 2016 on the Ethereum blockchain, it was envisioned as a decentralized venture capital fund, enabling investors to vote on which projects to fund.

The DAO quickly garnered significant attention, raising over $150 million in Ether, making it one of the largest crowdfunding campaigns at the time. However, a vulnerability in its smart contract code led to a significant hack, resulting in the loss of a substantial portion of the funds.

This event not only exposed the security risks associated with smart contracts but also influenced the subsequent hard fork of the Ethereum blockchain, leading to the split between Ethereum (ETH) and Ethereum Classic (ETC). The DAO’s story is a seminal chapter in DAO history, highlighting the importance of security and governance structures in decentralized organizations.

UniswapDAO

UniswapDAO governs Uniswap, one of the leading decentralized exchanges (DEXs) in the crypto space. It represents the community-driven aspect of the Uniswap platform, allowing token holders to vote on key decisions and proposals concerning the platform’s development and governance.

The creation marked a significant step towards decentralized governance in DeFi, empowering users to shape the platform’s future. Through a transparent and democratic process, UniswapDAO handles various aspects such as protocol upgrades, treasury management, and even community initiatives, illustrating the power of collective decision-making in decentralized finance.

MakerDAO

MakerDAO is a prominent DAO in the decentralized finance sector, primarily known for creating and managing DAI, one of the first decentralized stablecoins pegged to the US dollar. It operates on the Ethereum blockchain and uses a dual-token system consisting of DAI and MKR tokens.

While DAI is used as a stable medium of exchange, MKR tokens represent governance rights within the system. Holders of MKR tokens can vote on critical decisions like risk management, collateral types, and fee adjustments, making MakerDAO a pioneer in decentralized governance and stablecoin implementation. Its innovative approach to collateral-backed stablecoin issuance and governance has set a standard in the DeFi industry.

Stable DAO

Stable DAO is a decentralized cross-chain reserve currency protocol, inspired by the model of OlympusDAO. It aims to provide a reliable and consistent income stream, functioning as a semi-passive source of profits without depending on active involvement.

Stable DAO introduces features like a Universal Basic Income and referral rewards for early adopters. However, some experts raise concerns about its legitimacy. It’s essential to exercise caution and conduct thorough research before considering involvement with Stable DAO.

DAO Governance And DAO Token

The concepts of DAO governance and DAO tokens are central to the functionality and success of Decentralized Autonomous Organizations. They collectively represent the democratic and decentralized ethos of DAOs, setting them apart from traditional organizational structures.

DAO Governance

At the heart of every DAO is a governance system that is both transparent and inclusive, ensuring that every member has a voice in the decision-making process. This system is typically enacted through a voting mechanism, where token holders submit and vote on proposals concerning the DAO’s operation, policy changes, and other crucial decisions.

The voting power is generally proportional to the number of tokens a member holds, embedding a democratic structure into the DAO’s operations. This method of governance ensures that the direction of the DAO aligns with the interests of its community, as decisions are made collectively rather than by a centralized authority.

The governance structure in a DAO is codified in its smart contracts, which lay out the rules for proposing and voting on decisions. These rules can vary widely among different DAOs, tailored to their specific needs and goals. Some DAOs may require a simple majority for a proposal to pass, while others might have more complex mechanisms involving various types of votes or quorums. This flexibility allows DAOs to adapt their governance models to suit their evolving requirements.

DAO Token

DAO tokens play a crucial role in governance. They are not just a medium of exchange but also represent voting rights and membership within the DAO. These tokens are often distributed during the DAO’s formation, either through a public sale, airdrop, or as rewards for contributions to the DAO. The distribution method impacts the decentralization of the DAO; for instance, a broad distribution of tokens can lead to a more decentralized governance structure.

In addition to voting rights, DAO tokens can also have other utilities, such as profit-sharing rights, access to specific services within the DAO, or staking opportunities. The specific functions and rights associated with DAO tokens vary based on the DAO’s structure and objectives.

The integration of DAO tokens into governance mechanisms is a critical innovation in the blockchain space. It provides a tangible way to align the incentives of the participants with the success of the DAO. This alignment ensures that members are motivated to act in the best interest of the DAO, fostering a collaborative and effective ecosystem.

Practical Guides

How To Create A DAO?

Creating a Decentralized Autonomous Organization (DAO) involves a series of strategic, technical, and community-building steps, each crucial to the DAO’s success.

Define The Purpose And Structure: Start by clearly defining the DAO’s purpose, goals, and governance structure. This includes deciding on the voting mechanisms, membership criteria, and the role of the DAO tokens.
Develop The Smart Contracts: The core of a DAO is its smart contracts. These need to be meticulously coded, tested, and audited to ensure they execute as intended and are secure from vulnerabilities. These contracts should encapsulate the rules, voting mechanisms, and other operational aspects of the DAO.
Deploy On A Blockchain Platform: Choose a suitable blockchain platform (Ethereum is a popular choice) and deploy the smart contracts. This step officially launches the DAO on the blockchain.
Token Creation And Distribution: Create DAO tokens for governance and voting and distribute them through methods such as public sales, airdrops, or rewards for early contributors.
Build A Community: A DAO is only as strong as its community. Engage with potential members, promote your DAO’s vision, and encourage participation and voting.
Establish Legal Compliance: Ensure that your DAO complies with relevant legal and regulatory frameworks, a step often overlooked but crucial for long-term viability.
Continuous Development And Adoption: A DAO should evolve with its community’s needs and the broader blockchain ecosystem. Regular updates and improvements to the smart contracts and governance models may be necessary.

DAOs In Web3

In the web3 space, DAOs are more than just governance mechanisms; they are fundamental building blocks for decentralized applications (dApps) and services. They enable collective decision-making and resource allocation in a trustless environment, crucial for the decentralized ethos of web3. DAOs in Web3 can govern anything from content platforms to financial protocols, providing a transparent and democratic way to manage decentralized networks.

NFT DAO

NFT DAO is an innovative organization focused on enhancing and expanding the use of Non-Fungible Tokens (NFTs). Their mission is to develop open-source tools and components for building NFTs, applications, and marketplaces. A significant part of their work involves educating the next generation, offering Web3.0 project apprenticeships to college students.

Key initiatives of NFT DAO include developing NFT related open-source frameworks and standards, particularly for the Cardano blockchain. They have created their own NFT marketplace and are working on additional tools such as NFT Minting APIs and an auction API. Additionally, their payment gateway supports both fiat and cryptocurrency transactions.

Funded initially through votes from the Cardano community via Project Catalyst, NFT DAO also engages in consulting for projects aligned with their NFT technology expertise. They emphasize the development of open-source software components and actively support student involvement in blockchain and NFT projects through apprenticeships and scholarships.

List Of DAOs

Here’s a non-exhaustive list of notable DAOs, each exemplifying different aspects and use cases of DAOs:

Compound: Autonomous interest rate protocol for lending and borrowing.
MakerDAO: Decentralized lending platform and stablecoin issuer.
Aragon: Platform for creating and managing DAOs.
MolochDAO: Focused on Ethereum development funding.
Curve Finance DAO: Governs the Curve decentralized exchange.
PleasrDAO: A collective that acquires culturally significant NFTs.
Friends With Benefits (FWB): A social DAO focused on culture and networking.
Gitcoin DAO: Funds open-source development projects.

These DAOs, among many others, showcase the diverse applications and potential of decentralized autonomous organizations in various sectors of the digital economy.

The Future and Challenges of DAOs

The future of Decentralized Autonomous Organizations (DAOs) is both promising and laden with challenges. As DAOs evolve, they stand ready to make a significant impact across various sectors, ranging from finance to governance. However, realizing this potential involves carefully navigating a set of challenges.

Future Prospects

Wider Adoption In DeFi And Beyond: Anticipation is high for DAOs to take on a more integral role in decentralized finance (DeFi). The have the potential to provide a transparent and democratic framework for financial transactions and decision-making.
Expansion Into Mainstream Business: Beyond the blockchain sphere, DAOs have the potential to transform traditional business models. They offer a more collaborative and equitable approach to corporate governance.
Integration With Emerging Technologies: As technologies like AI and IoT advance, DAOs could integrate these to enhance automated decision-making and operational efficiency.
Legal Recognition And Frameworks: The future may see more countries recognizing DAOs as legal entities. This could provide them with a more stable and recognized operational framework.

Challenges To Overcome

Regulatory Uncertainty: The biggest challenge facing DAOs is the lack of clear regulatory frameworks. This creates uncertainty and potential legal challenges, especially in cross-border operations.
Security Risks: DAOs, being largely dependent on smart contracts, are susceptible to security risks. Ensuring the integrity and security of these contracts is paramount.
Scalability Issues: As DAOs grow, they face scalability challenges, both in terms large numbers of transactions and in decision-making processes.
Complexity In Governance: Balancing decentralization with efficient decision-making can be complex. DAOs must navigate the intricacies of collective governance while maintaining operational efficiency.
Technological Barriers: For wider adoption, DAOs need to address the technological barriers that might prevent non-tech-savvy individuals from participating fully.

The coming years will likely see innovative solutions to these challenges. This will pave the way for more widespread adoption and impact of DAOs across various sectors.

FAQ

What Is A DAO Meaning?

DAO stands for Decentralized Autonomous Organization. It refers to an organization governed by its members under transparent rules encoded in a computer program, operating independently of central government influence. DAOs embody decentralized governance models implemented on blockchain technology.

How Does DAO Governance Work?

In DAO governance, members democratically make decisions through collective voting. Each member’s voting power typically corresponds to their stake or token count. Smart contracts encode governance rules, ensuring transparency and compliance with established processes.

What Does DAO Mean?

DAO stands for Decentralized Autonomous Organization. It signifies an organizational structure that operates autonomously and decentralized, without central leadership, through smart contracts on a blockchain.

Who Made DAO?

Various entities and communities create DAOs to establish a decentralized governance body. Nick Szabo, in the 1990s, coined the term ‘smart contracts,’ a core component of DAOs.

What Are DAOs?

In DAOs, organizations decentralize and automate governance and decision-making using smart contracts on a blockchain. They operate without traditional management structures, and their rules and transactions are transparent and verifiable.

Whats A DAO?

A DAO is a blockchain-based system that enables collective decision-making or governance in a decentralized and automated manner. It stands for Decentralized Autonomous Organization.

What Is DAO Crypto?

DAO crypto refers to the use of cryptocurrencies and tokens within the DAO for governance, transactions, or incentivization. These tokens often represent voting rights and are key to the participatory governance model of DAOs.

What Is DAO Web3?

In the context of Web3 a DAO is a form of organization that operates on these principles. It represents a shift from traditional centralized internet services to a decentralized, user-governed approach.

What Is An Example Of A DAO?

An example is MakerDAO, a decentralized organization that manages the DAI stablecoin and operates on the Ethereum blockchain. It uses smart contracts to enable token holders to vote on decisions like risk management and development proposals.

What DAO Means In Crypto?

In the crypto world, DAO stands for Decentralized Autonomous Organization. The concept revolves around decentralizing and automating organizational governance and decision-making using smart contracts on a blockchain.

Who Owns A DAO?

Members or token holders collectively own a DAO. Unlike traditional organizations with a clear hierarchy, DAOs distribute ownership and decision-making power among their members. This aligns with the ethos of decentralization.

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On-chain data has revealed an increasing sentiment of holding Bitcoin among investors. Bitcoin has been on a roll since the start of the month, pushing its price to new yearly highs. At the same time, exchange data from CryptoQuant reveals that the crypto might be gearing up for a sustained bull run. According to the on-chain analytics platform, Bitcoin’s exchange supply, the amount available for purchase on exchanges, has dropped to its lowest levels since 2017 

Exchange Supply Drops To Lowest Level In Six Years

The Bitcoin market is flashing a bull signal that correlates with anticipation of spot Bitcoin ETF applications. CryptoQuant’s exchange reserve chart demonstrates that the supply of Bitcoin has been steadily decreasing from centralized exchanges since 2020 when it reached a high of over 3.2 million BTC. The outflow was particularly aggravated in the last quarter of 2022, when the collapse of crypto exchange FTX led to panic and investors started to opt for self-custody in cold wallets. During this period, exchange reserves dropped from 2.512 million BTC to 2.158 million BTC in a month.

https://x.com/cryptoquant_com/status/1733005131216744749?s=20 

Lowest Supply of #Bitcoin in Six Years

“We are in the 45th month of diminishing supply. For the first time, supply returned to 2017 levels. ”
by @1MrPapi

Link https://t.co/dY6QyFNit4

— CryptoQuant.com (@cryptoquant_com) December 8, 2023

Reserve on exchanges started to increase slowly in the early months of 2023, climbing back up to 2.240 million in May. However, things started to change in June, as filings by BlackRock and other investment companies for spot Bitcoin ETF trading in the US led to the start of a bullish sentiment. 

The reserve on centralized exchanges has been on a steady drop since then. At the time of writing, the exchange reserve has now crossed below 2 million BTC, a level it has yet to reach since December 2017. This metric’s six-year low is particularly interesting, considering Bitcoin’s total circulating supply has increased since 2017. Bitcoin’s total supply now stands at 19,564,812 BTC, a 16% increase from December 2017’s supply of 16.78 million BTC.

Outlook For Bitcoin Price: Bull Signal?

Although there are technically more bitcoins now available to go around, the increase in adoption is making it increasingly harder for traders to get a hold of the asset. Dropping exchange supply is a bullish signal for crypto assets and periods of low exchange supply have historically been associated with the beginning of significant Bitcoin bull runs. The last time Bitcoin had a drastic drop in exchange reserve was in 2020, and the crypto would later go on to reach its all-time high the year after.

Bitcoin is currently spearheading new inflows into the crypto industry, with Coinmarketcap’s Fear and Greed Index now pointing to an extreme greed of 82. The industry’s leading asset recently broke over $44,000 for the second time this week and is now up by 14% in a 7-day timeframe. Bitcoin is poised for extreme gains in 2024, and many analysts have predicted a price target above $100,000.

(This site’s content should not be construed as investment advice. Investing involves risk. When you invest, your capital is subject to risk).

Featured image from Freepik

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Prominent altcoin, XRP, has produced a positive performance in the last day, rising by 6.92%, according to data from CoinMarketCap. This price increase adds to the token’s impressive form all week, culminating in an 11.85% gain in the last seven days. 

Interestingly, it appears there may be larger gains for XRP investors in the coming months as popular crypto analyst Ben Armstrong has placed the token as the most favorable asset for investment ahead of a potential 2024-2025 bull crypto market.

XRP Is The Token To Buy In 2024, Analyst Explains Why

In a recent video on YouTube, Ben Armstrong has backed XRP to emerge as the leader of a potential crypto bull run over the next two years. Armstrong supports his claim with respect to many factors, including the team behind XRP, the token’s marketing, performance, utility, community, and technology, among others.

When commenting on marketing, the renowned analyst explains that XRP is one of the most advertised assets to institutional investors. Furthermore, he claimed that the token’s publicity has largely increased following Ripple’s long-lasting squabble with the US Securities and Exchange Commission, which eventually resulted in a partial victory.

On XRP’s performance, Ben Armstrong admits the altcoin left much to desire in the last bull run in 2020-2021. However, he attributes this negative performance to a suppression induced by the SEC case against Ripple. To back his XRP prediction,  the crypto analyst notes that the altcoin gained by over 44,000% in the 2017 bull run and could repeat a similar feat, topping the next bull run in 2024-2025. 

In addition, Ben Armstrong also believes that XRP Is going to experience more adoption by traditional institutions in the world. Notably, he references the current application of the token in the creation of CBDCs by the central banks of some nations. 

Armstrong Notes Worry Over XRP’s Tokenomics 

In his bold XRP prediction, Ben Armstrong has expressed some worry over the altcoin’s tokenomics as half of the coin’s supply is controlled by Ripple. 

Notably, this factor does not alter the analyst’s projection of the altcoin in 2024-2025. In fact, he believes the payment company to retain his control over XRP to be beneficial for investors. However, Armstrong predicts Ripple’s dominance in the XRP market might prove to be an unfavorable policy in the long run. 

At the time of writing, XRP trades at $0.687, with a 1.57% loss in the last hour. Meanwhile, the token’s trading volume is up by 51.78%  in the last day and is currently valued at $2.4 billion. 

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Mining Bitcoin is the cornerstone of the BTC network, providing both security and new Bitcoins into circulation. This essential process involves powerful computers solving complex mathematical problems to validate transactions on the network. As a reward for this computational work, miners receive new bitcoins, making it a potentially lucrative endeavor.

In this guide, we will explore the key aspects of “How to mine Bitcoin.” From understanding the basic mechanisms of how mining Bitcoin works to evaluating its economic feasibility, including the costs, potential earnings, and the time it takes to mine a single BTC. We’ll also guide you through the practical steps of setting up a mining operation, including choosing the right Bitcoin mining rig and the necessary software.

Moreover, for those looking to expand their mining activities beyond Bitcoin, we’ll cover the essentials of mining cryptocurrencies. We’ll introduce various crypto mining software and tools, providing a comprehensive view of the wider crypto mining landscape.

How To Mine Bitcoin

Mining Bitcoin is the process through which new bitcoins are released and transactions are added to the blockchain. At its heart lies the Proof of Work (PoW) algorithm, which requires miners to solve complex mathematical problems to validate transactions. Miners compete to complete these problems first, and the winner receives Bitcoin rewards.

This process inherently involves the difficulty adjustment, which ensures that the rate of block creation remains constant, and the hash rate, which is a measure of the processing power of the Bitcoin network. These elements combine to form the backbone of Bitcoin mining, securing the network and enabling the decentralized control that Bitcoin is renowned for.

Mining Bitcoin Explained

Bitcoin mining is a complex and multifaceted process, crucial for both the creation of new Bitcoins and the maintenance of the network’s integrity and security. Here’s an in-depth look at its key aspects:

Proof Of Work

Proof-of-Work (PoW) is a critical blockchain consensus mechanism that dates back to 1993 when Cynthia Dwork and Moni Naor first conceptualized it to deter email spam and DoS attacks. Adam Back’s Hashcash in 1997 advanced this concept by incorporating computational difficulty to combat email spam. These early forms of PoW laid the groundwork for Bitcoin’s implementation by Satoshi Nakamoto in 2009, which effectively solved the double-spending problem in digital currencies without the need for a centralized authority.

Bitcoin’s PoW operates like a computational lottery, with miners vying to solve cryptographic puzzles using the SHA-256 hash function. The more computational power a miner contributes, the higher their chances of solving the puzzle and receiving the block reward in Bitcoin. This mining process is fundamental to Bitcoin’s decentralized security and transaction validation.

The difficulty of mining adjusts approximately every two weeks or every 2,016 blocks, maintaining an average block time of around 10 minutes. This adjustment is crucial for the network’s stability, ensuring a steady rate of new block creation and coin issuance despite changes in network hash rate. The Bitcoin block reward, initially 50 BTC per block, halves every 210,000 blocks, a mechanism known as Bitcoin halving. This built-in deflationary aspect of Bitcoin is designed to gradually reduce the issuance of new coins.

PoW’s significance lies in its ability to secure the Bitcoin network through decentralization. By incentivizing miners across the globe to contribute computational power, it replaces the traditional role of central authorities in validating transactions.

Hash Rate

The hash rate, a critical metric in mining Bitcoin, refers to the total processing power utilized by miners on the network. It indicates how many calculations per second the network can perform, where a higher hash rate reflects greater security and mining difficulty. The hash rate directly influences the competitiveness among miners and the overall efficiency of the mining process. As Bitcoin’s price increases, more miners are encouraged to join the network, pushing the hash rate higher and making the mining process more competitive and energy-intensive​​.

Difficulty Adjustment

Bitcoin’s protocol includes a dynamic mechanism called difficulty adjustment, ensuring that new blocks are discovered approximately every 10 minutes. This adjustment occurs every 2,016 blocks, or roughly every two weeks, based on the total hashing power of the network.

If blocks are mined too quickly, the difficulty increases, making it harder to find new blocks. Conversely, if the block interval is slower than expected, the difficulty decreases. This self-regulating system maintains a stable block discovery rate, balancing the network against fluctuations in miner numbers and equipment efficiency​​.

Bitcoin Mining Economics Explained

Bitcoin mining economics encompass various factors such as computational power, energy costs, and market dynamics. Understanding these factors is crucial for any miner or investor who wants to know “how to mine Bitcoin.”

How Do You Mine Bitcoin?

Mining Bitcoin involves two major steps: building a block and proving the block. The former includes selecting and processing transactions for inclusion in the new block, while the latter involves solving a cryptographic hashing puzzle. This puzzle, part of the Proof-of-Work consensus, requires miners to generate a hash below the network’s target hash using high-powered computer hardware, typically ASIC miners. Once a miner successfully solves the puzzle, they broadcast the new block to the network, which is then verified by other miners​​.

Can You Still Mine Bitcoin?

Yes, individuals can still mine Bitcoin. However, it has evolved into a highly competitive and resource-intensive endeavor, with public listed companies taking the lead. Among the top mining companies are Marathon Digital (MARA), Riot Blockchain (RIOT), Canaan (CAN), Hut 8 (HUT), Cipher (CIFR), Core Scientific (CORZ), Bitfarms (BITF), Iris Energy (IREN), CleanSpark (CLSK) and Bitdeer Technologies.

The block reward, which includes both the block subsidy and the transaction fees, is the core incentive for miners. Currently, the block reward is higher than the transaction fees, but this will eventually change with one of the next Bitcoin halvings, but also depends on the evolution of the Bitcoin price.

How Long Does It Take To Mine A Bitcoin?

The time it takes to mine a Bitcoin is not fixed and depends on several factors, including the miner’s hash rate, the total network hash rate, and the current mining difficulty. The protocol is designed to adjust the difficulty to maintain an average block time of about 10 minutes.

However, for an individual miner, especially one with limited resources like one mining rig, mining a single Bitcoin can take years. This often leads solo miners to join mining pools to increase the chances of earning rewards more frequently​.

Growing Trend In Mining Bitcoin: Renewables

Research by environmentalist Daniel Batten suggests that mining Bitcoin can become carbon negative by utilizing waste methane as an energy source. Around 30% of the global temperature rise is attributed to methane, which has 80 times the warming power of carbon dioxide. Notably, 11% of global methane emissions come from landfills. Bitcoin mining can convert this waste methane into carbon dioxide, significantly reducing its environmental impact. Batten himself aims to generate 32 megawatts of power from landfills, offsetting about 4 million tonnes of carbon dioxide, which equates to 10% of Bitcoin’s carbon footprint.

In their latest research, the Bitcoin Mining Council’s (BMC) highlighted significant strides in sustainability and efficiency within the Bitcoin mining industry. The BMC, representing 45.4% of the global Bitcoin Mining Network, reported that its members are utilizing electricity with a 67.8% sustainable power mix. This figure reflects an estimated global average of 59.4% for the industry, marking an approximately 3% year-on-year increase from 2021. This progress positions the Bitcoin mining industry as one of the most sustainable globally.

How To Start Mining Bitcoins: A Step-by-Step Guide

Embarking on the journey of mining Bitcoin requires a strategic approach, starting with the selection of the right equipment.

Selecting the Right Bitcoin Mining Rig

Choosing the appropriate Bitcoin mining rig is critical for efficiency and profitability. The ideal rig should balance power, energy consumption, and cost. ASIC miners are the standard in mining Bitcoin due to their superior hash rates and energy efficiency compared to GPUs or CPUs.

When selecting an ASIC miner, consider factors like hash rate, energy consumption (measured in watts), cost, and the miner’s longevity. Higher hash rates increase the chances of successfully mining a block, but they also come with higher energy demands and costs. Balancing these factors based on your budget and the current Bitcoin mining landscape is key to a successful mining operation.

Comparison Of The Best Bitcoin Mining Rigs

Here’s a comparison of some of the best Bitcoin mining rigs in 2023:

Bitmain Antminer S21 Hyd: Latest Bitcoin miner by market leader Bitmain, released in September 2023. It delivers a hashrate of 335 Th/s while consuming 5360 W of power, available for pre-order at $5,897.16. It features a hydro-cooling system and is designed for high efficiency and adaptability to various environmental conditions​.
Bitmain Antminer S21: Offers a hashrate of 200 Th/s at a power consumption of 3010 W, priced at $4,500. Known for its air-cooling system, it operates effectively in environments with temperatures up to 45 degrees Celsius​​.
Bitmain AntMiner S19 Pro: Hash Rate 110 Th/s, Power Consumption 3250 W, Price $3,230. High hash rate, but expensive and power-intensive​​.
Bitmain Antminer S19 XP Hyd: Hash Rate 255 Th/s, Power Consumption 5346 W. Known for its extraordinary power and efficiency, it is the most powerful individual miner on the list. User-friendly interface, but price at $6,600.
Whatsminer M30S++: Hash Rate 112TH/S, Power Consumption 3472 W, Price $2,455 (used). Very powerful but more expensive and not ideal for beginners​​.
Canaan AvalonMiner 1246: Hash Rate 90Th/s, Power Consumption 3420W, Price $3,890. Fast hash rates and efficient, but comes with high noise levels​​.
Ebang Ebit E11++: Hash Rate 44 Th/s, Power Consumption 1980 W, Price $350 (used). Efficient and reasonably priced, but not ideal for home mining due to high noise levels​​.

Mine Bitcoins Software: Installing And Configuring

Selecting the right software is crucial for efficient Bitcoin mining. Here are some of the best Bitcoin mining software options in 2023:

CGMiner: Best overall for its ease of use and comprehensive features. It supports ASICs, GPUs, and FPGAs and runs on Windows, Mac, and Linux. However, it might be challenging for beginners due to its command-line interface​​.
MultiMiner: Ideal for beginners, offering an intuitive platform and easy setup. It’s optimized for Windows, with additional software required for Mac and Linux. While user-friendly, it may lack advanced features​​.
BFGMiner: Designed for advanced miners, this software offers extensive customization options and supports multiple coin mining. It’s compatible with various operating systems but is not suitable for beginners​​.
Awesome Miner: Great for large-scale mining operations, allowing management of multiple rigs and pools from a single dashboard. It supports over 50 mining engines but may be complex for beginners and lacks MacOS compatibility​​.
NiceHash: Best for cloud mining, this platform facilitates the trade of hashing power. It’s easy to use and set up, with a mobile app available, but comes with service fees and fluctuating bid pricing on hash power​​.

Bitcoin Mining At Home: Worth It?

Bitcoin mining at home can be challenging due to factors like hardware costs, high energy consumption, noise, and heat. While it offers a way to participate in the Bitcoin network, the profitability largely depends on electricity costs, hardware efficiency, and Bitcoin’s market price. For hobbyists or those with access to cheap electricity, it can be a viable option. However, for most individuals, joining a mining pool or cloud mining may be more practical and cost-effective.

Notably, the estimated electricity cost of mining one Bitcoin varies globally. The following map by CoinGecko shows the estimated cost, based on the average price of electricity.

Exploring Crypto Mining

Mining cryptocurrency extends far beyond Bitcoin, offering opportunities to mine a variety of altcoins. Altcoins, or alternative cryptocurrencies, have different technical underpinnings, mining mechanisms, and market dynamics compared to Bitcoin.

Mining Cryptocurrency: Which Altcoins You Can Mine

While Bitcoin remains the most well-known and mined cryptocurrency, several altcoins present attractive alternatives for miners. Here are some notable altcoins that use a Proof-of-Work and are popular in the mining community:

Litecoin (LTC): Often referred to as the silver to Bitcoin’s gold, Litecoin offers a faster block generation time and uses the Scrypt hashing algorithm. This algorithm is less memory-intensive than Bitcoin’s SHA-256, allowing miners to use less powerful hardware.
Dogecoin (DOGE): Originally created as a meme, Dogecoin has grown in popularity and credibility. It also utilizes the Scrypt algorithm and can be mined with the same hardware used for Litecoin, making it a viable option for those looking to diversify their mining activities.
Monero (XMR): Monero focuses on privacy and decentralization. Its mining algorithm is designed to be ASIC-resistant, favoring CPU and GPU mining. This approach ensures a more egalitarian distribution of mining rewards, making it an attractive choice for individual miners.
Zcash (ZEC): Zcash emphasizes privacy and anonymity in transactions. It uses the Equihash algorithm, which is also resistant to ASIC mining. This characteristic levels the playing field between individual miners and large mining operations, making GPU mining more effective.
Dash (DASH): Known for its fast transaction speeds, Dash operates on a X11 algorithm, which is a combination of 11 different hashing algorithms. This complexity makes it more resistant to ASIC mining, allowing for a broader range of hardware to be used for mining.

Crypto Mining Software

Crypto mining software is essential for connecting your hardware to the blockchain or mining pool. Different cryptocurrencies often require specific software due to their unique algorithms and mining processes. Here, we’ll focus on the recommended mining software for Litecoin, Dogecoin, and Monero, three popular altcoins in the mining community.

Litecoin And Dogecoin Mining Software

CGMiner: This is a versatile, open-source mining tool that supports a wide range of cryptocurrencies, including Litecoin and Dogecoin. It’s compatible with ASIC, FPGA, and GPU hardware and is known for its stability and efficiency.
EasyMiner: A user-friendly graphical interface makes EasyMiner a good choice for beginners. It works well with Litecoin and Dogecoin and offers a ‘Moneymaker’ mode, which automatically configures your miner for mining Litecoin on its own pool.
MultiMiner: Ideal for those new to mining, MultiMiner features a graphical interface and is compatible with hardware mining Litecoin and Dogecoin. It offers direct access to mining engine arguments and API settings.
Awesome Miner: This is a powerful tool suitable for larger-scale mining operations. It supports Litecoin and Dogecoin and offers comprehensive management features for various mining rigs and pools.

Monero Mining Software

XMRig: XMRig is a high-performance Monero (XMR) CPU miner, with official support for Windows. It’s widely regarded as one of the most efficient and versatile miners for Monero and offers detailed statistics about your mining operations.
MoneroSpelunker: This is a simple, easy-to-use GUI miner for Monero, making it ideal for beginners. While not as efficient as XMRig for advanced users, it’s a good starting point for those new to Monero mining.
MinerGate: MinerGate is a mining pool that also offers a GUI mining solution. It supports Monero and allows you to mine various cryptocurrencies simultaneously without reducing the hash rate for the major coin.
SRBMiner-MULTI: This miner supports CPU mining of Monero and various other coins. It’s known for its efficiency and the ability to mine multiple currencies at the same time.

Best Crypto Mining Tools

In addition to mining software, there are various tools that can enhance the mining experience, improve efficiency, and manage your mining operations effectively. These tools include:

Mining Operating Systems: Specialized mining operating systems like Hive OS or SMOS (SimpleMining OS) can optimize your mining hardware’s performance. They offer easy setup and management of your mining rigs, whether you’re mining Litecoin, Dogecoin, Monero, or other cryptocurrencies.
Hardware Monitoring Tools: Software like MSI Afterburner or HWiNFO can monitor your mining hardware, providing real-time data on temperature, fan speed, and performance. This is crucial for maintaining your hardware’s longevity and efficiency.
Mining Profitability Calculators: Websites like WhatToMine or CoinWarz allow miners to calculate potential profits from various cryptocurrencies, considering factors like hash rate, power consumption, and current market prices. These tools are vital for assessing the viability of mining different altcoins.
Pool Management Tools: If you’re part of a mining pool, tools like PoolWatch.io or Mining Pool Stats can help you track your performance, payouts, and the pool’s overall statistics.
Cryptocurrency Wallets: Secure storage for your mined coins is crucial. Each cryptocurrency typically has its own recommended wallets, but in general you should prefer hardware wallets (“cold wallets”) over software wallets for the highest level of security.

The Economics Of Mining Bitcoin And Cryptocurrencies

The economics of mining Bitcoin and other cryptocurrencies is a critical area for anyone considering entering this field. It involves understanding the costs associated with mining and the potential returns. This section will cover the fundamentals of calculating these costs and returns, providing insights into the financial aspects of cryptocurrency mining.

Calculating the Costs and Returns of Mining

To understand the economics of mining, one must first be able to calculate both the costs involved and the potential returns. Here are the key factors to consider:

Hardware Costs: The initial investment in mining hardware, such as ASIC miners for Bitcoin or high-end GPUs for crypto mining, is usually the most significant expense. The choice of hardware impacts both the efficiency and the potential earnings from mining.
Electricity Costs: Mining consumes a substantial amount of electricity. The cost of power can vary widely depending on geographic location and can significantly impact overall profitability.
Maintenance And Overhead: This includes costs related to cooling systems, internet connectivity, hardware maintenance, and any other operational expenses.
Mining Pool Fees: If you join a mining pool, which is common, especially for Bitcoin mining, you will have to pay fees, which are usually a percentage of the earnings.
Network Difficulty And Hash Rate: These are dynamic variables that affect how much you can earn. Higher network difficulty and hash rate mean more competition, potentially reducing individual earnings.
Cryptocurrency Value: The price of the cryptocurrency being mined is perhaps the most volatile factor. Higher prices can lead to higher earnings, but the opposite is also true.

The return on investment (ROI) is calculated by comparing the total costs (including the initial investment and ongoing expenses) against the revenue generated from mining. Calculators like CoinWarz and CryptoCompare can help estimate profitability based on current conditions.

How Much Does Mining Make?

The earnings from mining can vary greatly and are influenced by several factors:

Bitcoin Mining: The profitability of mining Bitcoin has decreased over time due to increased competition and halving events, which reduce the block reward. Large-scale operations in regions with cheap electricity are generally more profitable.
Crypto Mining: Some altcoins may offer higher profitability than Bitcoin, especially for individual miners or small setups. However, their market value can be more volatile, impacting earnings.
Market Conditions: The cryptocurrency market is highly volatile. Significant price swings can dramatically affect mining profitability.
Efficiency: The efficiency of your mining setup, including the hash rate of your hardware and your operational efficiency (like cooling and electricity costs), plays a crucial role in determining profitability.
Pool Earnings: Joining a mining pool can result in more consistent, albeit smaller, earnings compared to solo mining.

On average, the daily earnings for a miner can range from a few dollars to several hundred, depending on these factors. It’s crucial to conduct thorough research and calculations based on current market conditions and individual circumstances to get a realistic estimate of potential earnings from mining.

FAQs: How To Mine Bitcoin

This section addresses some of the most frequently asked questions about Bitcoin and cryptocurrency mining, offering clear and concise answers for both newcomers and experienced miners.

How to Mine Bitcoin?

To mine Bitcoin, acquire specialized mining hardware (ASIC miners are recommended), choose and install suitable mining software, and either set up a solo mining operation or join a mining pool. Additionally, create a secure Bitcoin wallet for receiving mining rewards.

How To Start Mining Bitcoin?

To start mining Bitcoin, you need to invest in appropriate hardware (like ASIC miners), choose mining software, join a mining pool if desired, and set up a Bitcoin wallet to store your rewards. Ensure you have a reliable power source and internet connection.

How Do You Mine Bitcoin?

Mining Bitcoin involves using specialized hardware to solve complex mathematical problems. Successful miners receive Bitcoin as a reward for adding new blocks to the blockchain. The process requires significant computational power and electricity.

Can You Still Mine Bitcoin?

Yes, you can still mine Bitcoin, but you’ll face fierce competition and a resource-intensive process. It necessitates significant investment in hardware and electricity.

What Is The Bitcoin Generator?

The term “Bitcoin generator” is often associated with scams. Legitimate Bitcoin mining is the only way to generate new Bitcoins, and it involves computational work using mining hardware.

How Do You Mine For Bitcoin?

You mine for Bitcoin by setting up mining hardware, running mining software, and participating in the network to validate transactions and discover new blocks. This process often involves joining a mining pool.

How To Make Bitcoin?

Besides mining, you can make Bitcoin by trading, participating in affiliate programs, offering goods or services for Bitcoin, or through Bitcoin faucets, although the latter often provides minimal returns.

How To Start Bitcoin Mining?

To start Bitcoin mining, research and purchase efficient mining hardware, decide between solo mining and joining a pool, download and configure mining software, and set up a secure Bitcoin wallet for payouts.

How Do I Generate Bitcoins?

Mining produces Bitcoins. This involves using computational power to solve cryptographic puzzles, thereby validating transactions and creating new blocks on the Bitcoin blockchain.

How To Bitcoin Mine?

Bitcoin mining requires specialized hardware (ASICs), mining software, and a stable electricity and internet supply. You can mine independently or join a pool to increase your chances of earning rewards.

How To Mine For Bitcoin?

To mine for Bitcoin, acquire suitable mining hardware, select and configure mining software, ensure a stable power and internet connection, and consider joining a mining pool to improve your chances of earning rewards.

How Are Bitcoins Created?

During the mining process, miners tackle complex mathematical problems to validate transactions and bolster the network’s security, thereby generating new Bitcoins as rewards for their work.

How To Generate Bitcoins?

The only legitimate way to generate Bitcoins is through mining. Be wary of any service claiming to generate Bitcoins without mining, as these are likely scams.

What Is A Bitcoin Mine?

A Bitcoin mine refers to a setup where Bitcoin mining takes place. It typically involves a series of computers (miners) working to solve mathematical puzzles that validate transactions and create new Bitcoins.

How Do You Mine Bitcoins?

Mining Bitcoins involves setting up mining hardware, installing mining software, solving cryptographic puzzles to validate transactions, and being part of the network that maintains the blockchain.

How Do You Mine Cryptocurrency?

Mining cryptocurrency generally involves setting up a computer system with specialized hardware and software to solve mathematical puzzles, validate transactions, and secure the network of a specific cryptocurrency.

How Is Crypto Mined?

Crypto mining involves using computers to solve complex puzzles, validating transactions on the blockchain. Miners who successfully solve cryptographic puzzles receive Proof of Work based cryptocurrencies as a reward.

How Is Cryptocurrency Mined?

To mine cryptocurrency, individuals solve cryptographic puzzles, thereby securing a blockchain network. In Proof of Work (PoW) systems, this requires powerful computing resources, whereas Proof of Stake (PoS) systems involve validators staking cryptocurrency to earn the right to validate transactions and create new blocks.

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Altcoins such as Cardano (ADA) had a widespread increase in value, similar to the altcoin cycle observed in early November. This cycle occurred when the momentum of Bitcoin slowed down, prompting traders to secure profits and allocate their investments towards smaller cryptocurrencies.

Because of the consistent price of Bitcoin (BTC), which encouraged capital rotation to alternative coins, native tokens associated with layer 1 (L1) blockchains saw the greatest gains on Saturday. Cardano (ADA) was the top performer in the weekend’s top 10 rankings.

According to Coingecko data, ADA price increased by 27% to 64 cents in the last day, for a strong 56.3% growth over the previous seven days. It is the largest increase since August 2022.

With the removal of the three major obstacles—the $0.40, $0.45, and $0.50—investors may begin to experience FOMO, or “fear of missing out,” as they discover ADA to be a compelling investment.

Cardano Bullish Momentum Sparks Optimism

No doubt, Cardano has emerged as one of the most appealing assets available on the cryptocurrency scene, attracting interest as traders fervently hope that the current bullish trend holds or if they are in for a startling letdown.

The money flow index’s (MFI) steady rise indicates that Cardano is firmly in the hands of bulls. For traders, there are currently several prospects for scalping, but in order to maintain investor optimism for a recovery to $1.00, ADA price needs to confirm higher support above $0.64.

An indicator that keeps track of money coming into and going out of Cardano is the MFI. Prices usually increase when the inflow volume far exceeds the outflow volume. This could account for the breakout from $0.65, and ADA might try to close the difference to $1 before the end of December if the trend holds steady.

The ADA price has been recognized for its gradual but consistent increase, which has kept the token from seeing a strong surge despite the favorable market sentiment.

Cardano Daily Active Addresses Climb

The forthcoming trade’s outline, however, seems to have altered as traders have been more engaged on the network, which might perhaps support a healthy upsurge. The on-chain statistics shows that the daily active address has increased significantly and reached quarterly highs.

Based on data from IntoTheBlock, around 80% of Cardano wallet addresses are sitting on unrealized profits at the current $0.56 price level.

If the wallet addresses stated above realize their gains, the asset’s price could correct since more people would be inclined to sell.

The notable #crypto market leaders over the past 24 hours are #Cardano (+19%), #Solana (+11%), and #Optimism (+11%). Each is seeing one of their highest social dominance days of 2023. With this implied #FOMO kicking in, proceeding with caution is wise. https://t.co/QvxDrofqJt pic.twitter.com/aUqIDoCLho

— Santiment (@santimentfeed) December 8, 2023

Meanwhile, ADA and a few other popular cryptocurrencies have exploded in social dominance, albeit Bitcoin’s influence is also growing.

According to the Santiment data above, market participants are now more positive about altcoins, particularly Cardano. In tandem with a sharp increase in their costs, social media conversations reached a two-month high, suggesting the onset of FOMO.

Therefore, the next few days might be seen as extremely important, since the fear of FOMO also carries a high risk of rejection once it reaches the critical points.

(This site’s content should not be construed as investment advice. Investing involves risk. When you invest, your capital is subject to risk).

Featured image from Shutterstock

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The price of some digital assets has reached an all-time high due to the recent growth in the bitcoin market. The unprecedented upswing in the cryptocurrency market has not only been good to tokens of decentralized protocols, but also meme coins like Bonk Inu (BONK). Today marked a new high for the token as its price increased by more than 200% in the weekly timeframe.

Solana’s meme coin Bonk has been on a tremendous bull run for quite some time, with a price increase of over 7,000%, indicating the strengthening of the Solana ecosystem.

BONK Surges: A Crypto Standout

November saw a sharp 1,000 surge in BONK’s value, making it one of the most profitable assets in the cryptocurrency market to date. The general upward trend in the cryptocurrency market in the first part of the month is partially the reason for this growth.

The BONK price has consistently produced large bullish candles since breaking out of the bearish trend it had been in since the start of the year. The majority of meme currencies are not moving very much, but BONK is experiencing high trade frequencies that are causing many bull runs.

Even though there was a slight decline in price, the bulls’ overwhelming domination kept the price above the gains. Considering that the volume has now turned to its advantage, the uptrend should last until the end of the month.

Based on the technical indications, there is no sign that the bullish momentum will abate anytime soon. At the moment, BONK is experiencing a strong positive trend, with its price hitting an exponential high of $0.0000152. Interestingly, the prior high at $0.0000100 has become a level of support.

The 89th position on the Relative Strength Index (RSI) indicates an overbought zone. Extended green histograms on the Moving Average Convergence Divergence (MACD) indicate a strong bullish trend.

BONK’s Ascent Faces Resistance Challenges

BONK will encounter early resistance near its new all-time high of $0.0000133299 if it continues to rise. Above that, the extended Fib -0.236 level at $0.0000156963 and Fib -0.382 at $0.0000171293 are targets for higher moves. Volume is still high, indicating that people are still interested in BONK as it rises.

Meanwhile, some fortunate Solana ecosystem participants stand to gain greatly from the skyrocketing price of the meme coin. Solana gave away $10 worth of BONK tokens when it released its Saga smartphone back in April. Those tokens are now worth over $11,500 because BONK is now over 1,000 times the price since then.

For those who are still holding onto their BONK airdrops, this has already been a transformative experience. Even in the wildest meme coin theories, gains of over a thousand percent are practically unheard of.

Furthermore, given the continued growth of the cryptocurrency industry overall, it is possible that Solana and the meme coin community will continue to surprise us in the future given the persistent enthusiasm and risk-taking behavior.

(This site’s content should not be construed as investment advice. Investing involves risk. When you invest, your capital is subject to risk).

Featured image from Shutterstock

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The price of Dogecoin has sometimes struggled this year, but the meme token has been on such a great run in the past few weeks, mirroring the current optimistic condition of the general cryptocurrency market. And if on-chain data is anything to go by, this current price rally might not be coming to an end anytime soon.

Dogecoin Successfully Clears All Major Resistance – What’s Next?

In a recent post on X, prominent analyst Ali Martinez revealed that the Dogecoin price has successfully cleared all major resistance levels. This latest on-chain revelation is based on IntoTheBlock’s price data, which revolves around the density of investors who bought the DOGE token at certain ranges.

#Dogecoin has successfully cleared all major resistance levels!

With the $0.095 support proving strong – thanks to 63,280 addresses buying 3.2 billion $DOGE – the path looks set for an upward journey. If this support remains firm, we could see #DOGE aiming for $0.14 next. pic.twitter.com/QmfZ9kY5Dh

— Ali (@ali_charts) December 8, 2023

According to the provided data, the $0.095 level seems to be the last significant resistant area for the DOGE price. And since the meme coin has gained some distance over the price range, the $0.095 area has flipped into a “strong support” – thanks to 63,280 addresses buying the cryptocurrency at this level.

The chart above shows how the Dogecoin price levels around the current value look in terms of the density of investors. The size of the dot reflects the number of investors who bought the meme token at each price range.

As displayed in the above graph and highlighted by analyst Ali Martinez, there are no major resistance zones above the current DOGE price. Hence, the value of Dogecoin looks set to continue on an upward trajectory.

The crypto analyst said that if the $0.095 support range continues to hold strong, there is a growing possibility for DOGE to climb as high as $0.14 in the near future. This represents a substantial 35% rally from the meme coin’s current price point.

DOGE Price Overview

As of this writing, Dogecoin is valued at $0.103424, reflecting a 6.7% price increase in the past 24 hours. This level of growth in the last day only underscores the meme token’s positive performance in the past few weeks.

Based on data from CoinGecko, the DOGE price has increased by more than 22% in the past seven days. Meanwhile, the cryptocurrency has registered roughly a massive 35% gain in a single month.

Dogecoin ranks as the tenth-largest cryptocurrency in the sector, with a market cap of approximately $14.6 billion.

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In a significant development for the blockchain data-oracle project, Chainlink (LINK) has witnessed a significant response to its enhanced crypto-staking program, amassing over $632 million worth of its LINK tokens within a remarkably short period. 

The company announced a recent press release highlighting the “overwhelming demand” during the early-access period, which filled the staking limit in just six hours.

Chainlink Unveils Staking v0.2

Chainlink, recognized as the industry-standard decentralized computing platform, unveiled Chainlink Staking v0.2, the latest upgrade to the protocol’s native staking mechanism. 

The Early Access phase has commenced, inviting eligible participants to stake up to 15,000 LINK tokens. This phase will last four days before transitioning into the General Access phase, enabling investors to stake up to 15,000 LINK tokens as long as the staking pool remains unfilled. 

Per the announcement, the upgrade introduces an expanded pool size of 45,000,000 LINK tokens, equivalent to 8% of the current circulating supply. This enlargement aims to enhance the accessibility of Chainlink Staking, enabling a more diverse audience of LINK token holders to participate. 

Staking forms an integral part of Chainlink Economics 2.0, which brings an additional layer of cryptoeconomic security to the Chainlink Network. Specifically, Chainlink Staking empowers ecosystem participants, including node operators and community members, to support the performance of Oracle services by staking LINK tokens and earning rewards for contributing to network security.

While v0.1 served as the initial phase of the Staking program, v0.2 has been restructured into a fully modular, extensible, and upgradable Staking platform. Building upon the lessons learned from the previous release, the v0.2 beta version focuses on several key objectives. 

Chainlink is introducing several new features to enhance its staking program. These include a new unbinding mechanism that provides more flexibility for Community and Node Operator Stakers.

Additionally, security guarantees for Oracle services are being reinforced by slashing node operator stakes. A modular architecture is being adopted to support future improvements and additions, and a dynamic rewards mechanism is being introduced to seamlessly accommodate new external sources of rewards in the future, such as user fees.

Following the conclusion of the Early Access phase on December 11, 2023, the v0.2 staking pool will transition to General Access. At this stage, anyone will have the opportunity to stake up to 15,000 LINK tokens.

LINK Surges To New Yearly High

Given Chainlink’s successful upgrade, LINK, the native token of the decentralized computing platform, experienced a significant surge of 12%, reaching a price as high as $17.305. 

This price level has not been seen since April 2022, signifying a new yearly high for the cryptocurrency. However, LINK has retraced slightly and is currently trading at $16.774.

Crypto analyst Ali Martinez has highlighted a critical support zone for Chainlink. Martinez noted that over 17,000 addresses purchased 47 million LINK tokens from $14.4 to $14.8. 

This accumulation by many addresses suggests strong buying interest in this price range, potentially acting as a support level for the token.

While the support zone may hold and trigger a rebound in the price of LINK, Martinez cautions that investors should remain vigilant. Any signs of weakness, such as a breach of the support zone or negative market sentiment, could prompt investors to sell their LINK holdings to avoid losses.

It remains to be seen whether LINK can maintain its position above these critical levels and whether the broader cryptocurrency market will enter an accumulation phase or experience a retracement after the significant upward movement witnessed in recent weeks. 

Such a retracement could potentially impact LINK’s price and lead to a test of the support above levels. On the other hand, the token faces immediate resistance at $17.483, $18.069, and $18.910. These represent the final hurdles to overcome before LINK reaches the $20 milestone.

Featured image from Shutterstock, chart from TradingView.com 

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There is a spike in crypto on-chain activity if transaction fees lead. According to IntoTheBlock data on December 8, Bitcoin transaction fees are up by over 60%, while “gas” in Ethereum has climbed by nearly 50% in the past week. 

Bitcoin And Ethereum Transaction Fees Rise By Double-Digits

This surge in activity can be pinned to multiple factors, mainly growing user interest and the ongoing crypto bull market. To illustrate, Bitcoin and Ethereum prices are trending at 2023 highs above $43,500 and $2,300 when writing.

Even so, the crypto community expects these coins to extend gains in the coming weeks and months, partly because of expected institutional capital, projected to be in their billions, flowing to the sphere.

According to IntoTheBlock data, cumulative fees collected in Bitcoin this week stand at $43.8 million, up 61%. On the other hand, $83.3 million in fees has been accrued from Ethereum. 

Looking at the historical transaction fees trend, transacting on Ethereum, despite its relatively high transaction processing speeds (TPS), is more expensive than Bitcoin. This can be due to Ethereum’s role in decentralized finance (DeFi), non-fungible token (NFT) minting, and more. Bitcoin is a transactional layer and doesn’t inherently support smart contracts.

Usually, rising on-chain transaction fees are bullish for price and indicate that their respective ecosystem is thriving from increasing adoption. With transaction fees rising in the two leading blockchain ecosystems, more people want to interact with the project. Subsequently, this could support prices since BTC or ETH is used for paying transaction fees. 

Will BTC Ease Past 2021 Highs Of $70,000?

As BTC is currently trading above $43,500 and ETH recently broke above $2,300, the possibility of these coins retesting and easing past their all-time highs of $70,000 and $4,800, respectively, cannot be discounted. One of the key drivers of the surge in on-chain activity is the ongoing bull market.

With crypto rising, more people are looking to position themselves, hoping to profit from further price appreciation. This wave of fear of missing out (FOMO) has pushed higher fees and prices.

The demand for liquid and SEC-recognized digital assets will likely increase once the Securities and Exchange Commission (SEC) goes ahead and authorizes the first Bitcoin ETF. This derivative product will allow institutions to invest in Bitcoin confidently through a regulated solution. 

As the odds of the SEC approving this product rose from early Q4 2023, BTC and ETH prices started rising in sync. Still, how prices will react once the spot Bitcoin ETF is approved remains to be seen. Once the SEC green-lights a spot Bitcoin ETF, the crypto market will begin looking at Ethereum and whether the agency will approve a similar solution.

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