Blockchain

Bitcoin (BTC), the largest cryptocurrency by market capitalization, closed January above the $40,000 threshold, signaling positive price action. However, market expert Justin Bennett suggests that Bitcoin’s bottom has yet to be reached. 

Bennett’s analysis highlights the possibility of further price declines, with Tether’s stablecoin USDT dominance (USDT.D) chart indicating potential downward movements. 

Tether Dominance Signals Concerns For BTC’s Price

Bitcoin’s recent price recovery and ability to surpass the $40,000 level have provided optimism among investors. Nevertheless, Bennett believes further price declines could follow a retest of the mid $44,000 range. 

Bennett highlights the inverse relationship between Tether dominance and Bitcoin. According to his analysis, the levels on the Tether dominance chart since October have been reliable indicators for Bitcoin’s price movements. 

According to Bennett’s analysis, as depicted in the chart above, Tether’s dominance may experience a potential increase from its current level of 6%. This increase could bring it closer to the 8% mark. 

In such a scenario, Bitcoin’s performance would likely move in the opposite direction, indicating potential price declines soon.

On January 25, Bennett suggested that Bitcoin could drop another 20% from its current levels, which would place it around $30,000. If this scenario plays out, it would be crucial for Bitcoin bulls to defend the $30,000 level to maintain the current bullish structure.

A drop below $29,000 would give bears a stronger position, with only three major support lines remaining at $28,400, $25,900, and $24,000 before a potential retest of the $20,000 mark. 

The performance of these support levels and Bitcoin’s ability to withstand increased selling pressure will be key factors to monitor. The future market sentiment will also play a significant role in determining Bitcoin’s price trajectory.

Bitcoin Witnesses Stellar Accumulation Trend

Despite the possibility of further price drops, renowned crypto analyst Ali Martinez has shed light on a notable trend in BTC’s recent accumulation streak by investors.

According to Ali Martinez’s analysis, Bitcoin is experiencing a significant accumulation streak, rivaling some of the most notable periods observed over the past few years. 

The Accumulation Trend Score, a metric that gauges the buying activity of larger entities, has remained consistently high, hovering near 1 for the past four months.

This suggests that influential market participants are actively accumulating Bitcoin, signaling their confidence in the long-term potential of the cryptocurrency. 

Martinez’s observations further indicate that Bitcoin’s price range around $42,560 has emerged as a highly significant interest zone. 

Within this range, an impressive total of 912,626 BTC has been transacted. This is expected to be a significant support level, potentially preventing further downside movements and fostering increased buying interest.

These trends collectively contribute to a positive market outlook, suggesting that despite potential price drops, Bitcoin remains an attractive asset for long-term investment.

Featured image from Shutterstock, chart from TradingView.com 

Recent data shows that Solana-based decentralized exchanges (DEXs) have taken Ethereum’s spot in a key metric, creating expectations and positive sentiment for the Solana (SOL) ecosystem.

Solana DEXs Outperform Ethereum

According to data from DeFiLlama, Solana-based decentralized exchanges (DEXs) have flipped Ethereum in daily trading volume. Over the last 24 hours, Solana’s $1.14 billion trading volume surpasses Ethereum DEX’s $1.133 billion trading volume.

This accomplishment occurred for the first time in December of 2023 when Solana’s daily DEX volume reached $1.475 billion, surpassing Ethereum’s $1.164 billion, and hit a growing interest by traders in the SOL ecosystem.

Solana also saw a weekly change of +37.67% in its trading volume. However, the data shows that Ethereum is still above Solana in the 7-day volume metric, with $7.852 billion and $ 6.113 billion, respectively.

Additionally, data from CoinGecko shows that Solana-based DEXs Jupiter and Orca are among the 3 largest decentralized exchanges by volume in the last 24 hours. As the chart below displays, Jupiter has a daily volume of $ 614 million, while Orca shows a volume of $380 million, occupying the second and third spots, respectively.

Ethereum’s Uniswap V3 topped the chart with a daily volume of $636 million. The data also shows Raydium among the top 10 DEXs by volume in the last 24 hours.

Research platform SoSo Value pointed out on X (formerly known as Twitter) the recent Jupiter’s rise in popularity and monthly users’ increase as a key contributor to the Solana ecosystem’s boost in activity, bringing considerable attention and trading activity into the ecosystem.

These recent achievements hint at a healthy growth and development of Solana’s DeFi ecosystem.

Solana’s Price Action

The surge in interest in Solana has been driven by its meme coin sector, the airdrops, and fast transactions offered to its users. As a result, its native token managed to reclaim previously lost territory.

However, while Solana surpassed Ethereum’s DEX on low timeframes, the second crypto by market cap remains king of the DeFi sector. The chart above shows that the Ethereum-based DEX holds over $6 billion in Total Value Locked (TVL).

This piece of data indicates the resilience of the ETH ecosystem in maintaining its position as king of DeFi but holds promise for Solana. The fast-growing blockchain could attract further attention and interest if the daily trend extends.

Despite some fluctuation in the last few weeks, Solana’s price has surfaced in the $90-$100 price range in the last month. According to CoinGecko data, SOL’s price has surged 1.9% in the last 24 hours and 6.3% in the previous 7 days.

Tuur Demeester, a Bitcoin evangelist, has recently shared his views on Bitcoin’s potential to reach the $1 million mark by 2028. Demeester’s view on this topic presents a cautious contrast to some of the more bullish predictions in the crypto community.

This tempered perspective comes when others, such as Samson Mow, express strong confidence in Bitcoin’s ability to hit this milestone following its next halving.

$1 Million Bitcoin By 2028 Is Not Certain

Demeester’s skepticism was articulated in response to a post sharing a graph by investor Fred Krueger, which suggested that Bitcoin might reach the $1,000,000 level by 2028.

While appreciating the graph’s model, Demeester expressed uncertainty, acknowledging the unpredictable nature of the market and its capacity to defy even the most well-constructed models.

Will it take BTC until after summer 2028 to reach $1M? I don’t know, but I do know that every beautiful model (as is this one ) is destined to be broken by Mr. Market. https://t.co/GcmhfL2C16

— Tuur Demeester (@TuurDemeester) February 2, 2024

The anticipation surrounding BTC’s price of $1 million is closely tied to its halving events, which occur approximately every four years. After this year’s halving, the next halving is set to occur in 2028. These events reduce the number of new BTC mined per block by half, limiting the supply and potentially impacting the price.

The upcoming halving, set for April this year, will see the daily minting of Bitcoin slashed from 900 to 450 coins. Such supply changes have historically led to significant price movements, lending credibility to the various models predicting substantial future price increases.

Amid these predictions, an X user, claiming ownership of the growth plot referenced by Demeester, chimed in with insights. They argued that some market laws, like the time value of money in the stock market, are less likely to be broken.

Similarly, the natural adoption rate of Bitcoin might constrain its “explosive” growth, providing room for market movements without breaking the underlying model.

Hi Tuur, this plot is mine. Some laws are not broken by Mr Market, e.g. the stock market grows by ~7% p.a. This cannot be broken to the upside because of the time value of money (essentially).
The time-based power-law likewise is hard to break to the upside because that would go…

— hcburger (@hcburger1) February 2, 2024

Diverse Views On Bitcoin’s Future

Other Bitcoin enthusiasts, like Samson Mow, CEO of Jan3, are more optimistic. Mow envisions Bitcoin reaching $1 million, potentially in a sudden surge causing “max pain” for several market players.

This dramatic increase, he suggests, could happen swiftly, within “days or weeks,” though the precise starting point remains uncertain.

My main prediction is the run up to $1M happens in days to weeks. Starting point TBD.

— Samson Mow (@Excellion) January 14, 2024

In analyzing potential triggers for a Bitcoin rally, Mow considers various factors. These include Bitcoin-specific metrics like exchange-traded inflows (ETF), the BTC hashrate, and whale activity on Bitfinex. Additionally, Mow looks at broader economic indicators such as Tether’s USDT assets under management, government debt payments, and Debt-to-GDP ratios.

These are the #Bitcoin macro indicators I’m looking at:

ETF inflows
Hashrate
Finex whale accumulation
200 WMA trend
Tether USDt AUM
Govt interest payments on debt
Debt GDP ratios
Nation-state Bitcoin adoption
Real inflation
M3 money

— Samson Mow (@Excellion) January 28, 2024

Mow believes these factors, combined with nation-state adoption, real inflation rates, and the M3 money supply, could significantly influence Bitcoin’s performance.

Amid the debate, Bitcoin saw quite a surge in the past 24 hours, reclaiming the $43,000 mark with a current trading price of $43,123.

Featured image from Unsplash, Chart from TradingView

In recent developments, two California school district officials have admitted guilty to stealing up to $1.8 million and misappropriating electricity to finance and operate a clandestine crypto-mining operation. 

The United States Department of Justice (DOJ) disclosed that Jeffrey Menge, former Assistant Superintendent and Chief Business Officer of Patterson Joint Unified School District, and Eric Drabert, the district’s IT Director, pleaded guilty to charges of theft concerning programs receiving federal funds. 

Fraudulent Billing Scandal

According to the DOJ’s statement, Menge, as Assistant Superintendent, hired Drabert as the school district’s IT director around 2020. 

Together, they orchestrated a series of illicit activities to siphon funds from the district. Menge reportedly utilized a Nevada-based company called CenCal Tech LLC, which he controlled, as a front for the crypto scheme. 

The investigation revealed that to circumvent restrictions on conducting interested party transactions, Menge created a fictitious executive, “Frank Barnes,” to represent CenCal Tech. 

Through this setup, it is alleged that Menge and Drabert executed fraudulent transactions worth over $1.2 million, involving practices such as double billing, overbilling, and billing for undelivered items.

Illicit Crypto Mining Operation Unveiled 

Diversifying their criminal activities, Menge and Drabert went beyond financial embezzlement, according to the US Department of Justice. 

The law enforcement agency stated that the individuals utilized “high-end graphics cards,” school district property, and electricity to establish and operate a crypto mining farm within the school district. 

The illegally mined crypto assets were then redirected to wallets under their control. Additionally, Menge is alleged to have exploited school district-owned vehicles, acquiring a Chevy truck at a discounted price and selling it for personal profit while using a Ford Transit van as his vehicle.

The overall magnitude of the embezzlement was staggering. Menge misappropriated funds between $1 million and $1.5 million, while Drabert was found guilty of stealing between $250,000 and $300,000. 

The DOJ revealed that the ill-gotten gains were used for “lavish” personal expenses. Menge indulged in remodeling his residence, purchasing luxury vehicles, including a Ferrari sports car, and funding other personal endeavors. Drabert, on the other hand, utilized stolen funds to renovate his vacation cabin and for various personal expenses.

The guilty pleas by Jeffrey Menge and Eric Drabert, former officials of Patterson Joint Unified School District, shed light on a shocking case of embezzlement and crypto mining fraud within the education system. 

Featured image from Shutterstock, chart from TradingView.com 

BNB, the native token of the Binance Smart Chain, experienced a drop on Friday, showing a huge red candlestick after opening at around $305 and moving downward toward $297.93.

This downward move began with a rejection at $312.53 on Wednesday, thereby creating resistance at the same level. At the time of writing, the price still shows strong signs of moving downward to its previous support level of $300.

If this support level is unable to hold, then the price might continue downward to the next support level at $263.93. But, if the support does hold, we might see the price bounce back and move upward to create a new high for the year. However, the price is still above the 100-day moving average, which is usually a bullish sign for the price.

Technical Indicators Point Toward Sustained Downtrend For BNB

To figure out where the BNB price might be headed next, several indicators can be used to examine the chart;

4-Hour MACD: We can see that the histogram is below the zero line, thereby suggesting a downward trend.

   SOURCE: Tradingview

We can also see that the MACD line has crossed below the signal line, pointing toward a sustained bearish trend.

1-Day MACD: From the daily chart, we can confirm that both the MACD line and signal line have crossed and are heading toward the zero line, while the histogram is already below the zero line, indicating further downward movement.

  SOURCE: Tradingview

4-Hour Alligator Using the alligator indicator to examine the chart on the 4-hour timeframe, we can see that the jaw, the teeth, and the lips are all facing downward and are separated from each other. This has historically been a bearish signal and suggests further downward momentum.

   SOURCE: Tradingview

1-Day Alligator: Also, looking at the alligator indicator from the daily chart, it can be seen that the alligator lip [green line] and the teeth [red line] are showing signs of cross over the jaw [blue line], suggesting a downward movement

 SOURCE: Tradingview

Final Thoughts

Although the MACD and the Alligator are popular indicators, it should be noted that they are not infallible, and traders frequently combine them with other technical analysis tools to help them make better trading decisions. 

Furthermore, false signals can happen, particularly in erratic or sideways markets, so it’s critical to take the larger market context into account.

DOGE The Dogecoin network is on a roll after a particularly disappointing performance leading up to the end of January. Usage on the network is beginning to pick up once more after the price made its way above $0.08. New adoption saw the highest spikes, as almost 1 million new DOGE wallets were created in a 7-day period.

890,000 New Dogecoin Wallets In One Week

According to data from the on-chain analytics platform, IntoTheBlock, the number of new addresses created on the Dogecoin network spiked significantly in the last seven days of January. The total number of new addresses created during this one-week period came out to a total of 890,000. However, the most interesting part is the spike that took place between January 28 and 29.

In the screenshot shared by IntoTheBlock on X (formerly Twitter), we can see that the majority of new wallets creation happened in a single day. The daily wallet creation went from an average of 60,000 leading up to January 28, and by January 29, around 240,000 new wallets were created in a single day.

The next day would see a slight decline from these 2024 highs. But by January 31, the numbers picked up once more. During this time, another 200,000 DOGE wallets were created in a single day, accounting for one of the largest spikes in new wallets on the network.

IntoTheBlock offered a possible explanation for the spike in new wallets which could be related to an increased interest in Doginals. Doom, a highly anticipated project, was launched on the Dogecoin blockchain, contributing to the spike. The on-chain tracker also added that “the rumors of Xpayments could be driving new users to Dogecoin.”

Machine Learning Algorithm Not Convinced On DOGE Price

Despite the increased interest in the Dogecoin network over the last week, the outlook for its native DOGE coin is still not favorable, according to the machine learning algorithm at CoinCodex. The algorithm has presented the likely movements of the DOGE price over the next few days to the next month, and they are far from bullish.

For the nearest term, the CoinCodex machine learning algorithm expects that there will be a small increase in price over the next five days, with an expected 1.54% rise. However, looking out in the long term, the algorithm expects a change in this positive momentum.

Over the next month, the AI expects that there will be an around 11.13% drop in price from the current levels. This would put the DOGE price at $0.071, pointing to the current sentiment toward the meme coin being rather bearish for now.

Nevertheless, Dogecoin is still holding on to its small gains of 0.7% over the last day, while maintaining its position as the 10th-largest cryptocurrency in the space with a market cap of $11.37 billion.

With zero knowledge (ZK) proofs expected to be a game changer for blockchain scaling, Polygon may be on the brink of a major rally. Taking to X on February 2, crypto market commentator Polynya, asserts that ZK technology is the “endgame” as its “1,000x efficiency upside is irresistible for networks.”

Will “ZK” Technology Be The “End Game”?

This forecast on ZK adoption is massive for Polygon and its native token, MATIC, which has been under significant selling pressure in the past few trading months. As it is, Polygon Labs, the developer of the Ethereum sidechain, has been at the forefront, advocating for the development of ZK scaling solutions.

In 2021, Polygon began assembling a team to develop zkEVM, a technique relying on zero knowledge to scale Ethereum cheaply while being compatible with the EVM. Recent Polygon Labs documentation shows that their zkEVM is in beta and being tested.

However, this hasn’t stopped the team from striking deals with layer-1 protocols interested in harnessing this technology.

In mid-January, NEAR Protocol’s Data Availability (DA) solution was integrated with Polygon’s custom blockchain development kit (CDK). The goal was to make it easier for developers to create ZK rollup solutions suitable for their needs while leveraging NEAR Protocol‘s infrastructure. All this is when ensuring the integration lowers cost and improves performance.

Polygon Labs has also partnered with other platforms, including Immutable–a layer-2 web3 solution for NFTs; Ankr–an infrastructure provider; and QuickSwap–a decentralized exchange (DEX). Most of these platforms plan to operate as layer-2s for Ethereum. 

The total value locked (TVL) in layer-2 protocols remains in an uptrend, according to L2Beat. These platforms command over $21 billion. So far, the largest layer-2 protocols, Arbitrum, Optimism, and Base, use Optimistic Rollups. 

Is Polygon (MATIC) Ready For $3?

This is a bullish development for Polygon. Moreover, at this pace, it is likely to cement Ethereum, the pioneer layer-1 and smart contract platform, as a dominant settlement layer despite on-chain scaling concerns and relatively high fees.

From a price point perspective, MATIC will likely benefit as more platforms adopt Polygon’s zkEVM solutions. So far, MATIC is stable but firm when writing on February 2. From the daily chart, MATIC has support at around $0.70. On the upper end, the immediate resistance level is at $1. 

Spurred by partnerships as more platforms use zkEVM, fundamental developments might drive MATIC even higher in the coming sessions. If MATIC finds momentum, the medium- to long-term target will be $3, or a 2021 high.

Chainlink has shot up over 12% to break $18 during the past day. A retest of the on-chain resistance wall at $20 could be next.

Chainlink Has Outperformed Market With Its 12% Rally

The past 24 hours have been green for most of the cryptocurrency sector, but the positive returns have been small for most of the market, with Bitcoin, the largest digital asset, only seeing profits of 1%.

Chainlink, however, has separated from the crowd during this period, rallying around 12%. The chart below shows how the coin has performed over the last few days.

With this latest surge, Chainlink has surpassed the $18 level for the first time in almost two years. With profits of about 30% over the past week, LINK is by far the best-performing asset among the top 60 cryptocurrencies by market cap.

Speaking of the market cap list, LINK has now flipped Tron (TRX) to become the 11th largest asset in the sector following this recent strong performance. The table below shows where LINK stands among its peers in the sector right now.

Dogecoin (DOGE) is the next coin above Chainlink now, and if the asset can continue its run, it should be able to flip the meme coin. While there is still some gap between their market caps, it isn’t too big.

Whether the coin can further this rally or not, perhaps on-chain data could provide some hints.

LINK Has Next Major On-Chain Resistance Wall Around $20

As explained by analyst Ali in a new post on X, LINK has significant on-chain resistance at $20. In on-chain analysis, the strength of a support/resistance level lies in the amount of BTC that the investors bought at it.

Below is a chart that shows the distribution of holder cost basis across the various LINK price ranges near the current price of the cryptocurrency.

When the analyst shared the chart, LINK was trading around $17.85, and the ranges until the $19.49 to $20.03 one weren’t too dense with investors. Chainlink has mowed through some of these weaker price levels since then, and the asset may continue to do so until it strikes the resistance wall around $20.

In total, 5,330 addresses bought 8.59 million LINK within this range. Generally, investors become more sensitive when the price retests their cost basis, so they may be prone to making some moves. For investors in loss like those inside this range, such a retest can mean an exit opportunity, as they might be desperate to get their money back.

This effect becomes more pronounced as investors share their cost basis inside the same range, so ranges with dense cost basis distribution can be a source of major resistance for the spot price.

Despite the XRP price’s recent decline, Crypto analyst Egrag Crypto has provided a reason to believe that this presents the perfect opportunity to accumulate more of the token rather than lose conviction in its potential. 

XRP On Its Way To $22 Soon?

Egrag recently hinted in an X (formerly Twitter) post that XRP could rise to $22 soon enough. The accompanying chart he shared showed that the crypto token will hit this price level if it follows the green route, which the analyst has constantly alluded to. In an X post made last year, Egrag suggested that XRP could hit $22 in July this year if the green route were followed. 

Meanwhile, in his more recent analysis, he also touched on a Symmetrical Triangle that was currently forming. According to Egrag, XRP price dips are buying opportunities as long as the crypto token maintains its Symmetrical Triangle Formation. Interestingly, crypto analyst Jaydee also recently mentioned this bullish pattern. 

However, in his analysis, Jaydee stated that the Symmetrical Triangle had already formed on the monthly chart. This chart pattern is significant as it is said to have been the trigger for XRP’s parabolic move back in 2017 when it recorded gains of over 30,000%. 

Following the formation of this pattern, the analyst expects the MACD (Moving Average Convergence Divergence) to cross zero in the coming months, with the parabolic move coming after. The accompanying chart that Jaydee shared suggested that XRP could rise well above $12 when this move to the upside occurs. 

The Wave 2 Analysis

In his most recent X post, Egrag analyzed XRP’s current price movement. The analyst believes that XRP’s Wave 2 correction will follow a regular pattern and expects that the corrective Wave C won’t dip below $0.41. However, if that doesn’t happen, he noted that there is the possibility of Wave C dropping to between $0.35 and $0.40. 

He went on to state that XRP staying above the $0.28 level is very key from a macro standpoint. XRP dropping to that will no doubt paint a very bearish outlook for the crypto token. Whatever happens, Egrag remains bullish on XRP as he called on XRP holders to get ready for the “big mega boom coming soon.”

In his opinion, there would be a life-changing opportunity for the XRP community between now and 2025. Considering that the analyst had already predicted XRP to hit $5 in 90 days, this life-changing opportunity could well come sometime in April.

At the time of writing, XRP is trading at around $0.50, up over 2% in the last 24 hours, according to data from CoinMarketCap.

Market analysts have recently observed a notable pattern in Bitcoin price chart, potentially signaling a shift in the market trend. Jake Wujastyk, a prominent market analyst, has particularly pointed out the emergence of an inverse head and shoulders pattern on Bitcoin’s daily candle chart.

This pattern, coupled with Bitcoin’s closing price above a significant “volume shelf” signals an imminent upward trajectory for Bitcoin.

Bitcoin Surge On The Horizon

In technical analysis, an inverse head and shoulders pattern is traditionally interpreted as a bullish signal. It is characterized by two lower peaks (shoulders) on either side of a far-down valley (head). The completion of this pattern occurs when the price breaks above the resistance level, known as the “neckline.”

In Bitcoin’s case, this neckline also aligns with a ‘volume shelf,’ as Wujastyk indicates, a price level where many contracts have previously been traded, indicating strong support or resistance.

#Bitcoin Inverse head & shoulders on the daily candle chart as price closed above the volume shelf today. $BTCUSD #Crypto pic.twitter.com/zE1lDJGnAM

— Jake Wujastyk (@Jake__Wujastyk) February 2, 2024

As Bitcoin’s price currently sits above the critical level of $43,000 up by 4.7% in the past week, it suggests a growing momentum among buyers, hinting at a potential uptrend. At the time of writing, Bitcoin has seen a 2.1% increase in its price over the past 24 hours, reaching $43,144.

This price movement occurs against a backdrop of fluctuating daily trading volumes, which have decreased from over $25 billion to below $20 billion in a day.

Notably, this pattern’s emergence is particularly noteworthy as Bitcoin options are set to expire, with 22,000 BTC options nearing their expiry date. These options have a Put Call Ratio of 0.66, a Maxpain point of $42,000, and a notional value of $960 million, as per data from Greekslive.

For context, the Put Call Ratio is a key indicator in options trading, representing the number of put options relative to call options. A lower ratio suggests a bullish sentiment, as it indicates more call options (bets on the price rising) are being traded compared to put options (bets on the price falling).

Market Trends And BTC Halving Anticipation

The broader crypto market, including Ethereum (ETH) options, is also approaching expiration. 230,000 ETH options are set to expire, with a Put Call Ratio of 0.33, a Maxpain point of $2,300, and a notional value of $530 million. These figures suggest a more bullish outlook for Ethereum compared to Bitcoin.

Furthermore, according to GreekLive, the market has seen subdued activity recently, with both realized volatility (RV) and implied volatility (IV) trending lower for major cryptocurrencies.

Feb. 2 Options Data
22,000 BTC options are about to expire with a Put Call Ratio of 0.66, a Maxpain point of $42,000 and a notional value of $960 million.
230,000 ETH options are about to expire with a Put Call Ratio of 0.33, a Maxpain point of $2,300 and a notional value of… pic.twitter.com/tEQWxRXxtB

— Greeks.live (@GreeksLive) February 2, 2024

However, introducing Bitcoin spot exchange-traded funds (ETFs) is beginning to attract incremental capital to the crypto market, compensating for the slowdown in grayscale sell-off. Meanwhile, the anticipation around Bitcoin’s halving event, scheduled for April 2024, is creating a buzz in the market.

A recent survey by Bitget indicates a bullish sentiment among investors regarding the upcoming Bitcoin halving. 84% of respondents globally believe that Bitcoin will exceed its all-time high of $69,000 in the next bull run.

Predictions for Bitcoin’s price during the halving are varied, with over half expecting it to be between $30,000 and $60,000, while about 30% foresee it is surpassing $60,000.

Featured image from Unsplash, Chart from TradingView