Blockchain

An analyst has explained that the outlook for Bitcoin should remain bullish as long as the cryptocurrency’s price remains above this level.

Bitcoin Has Strong On-Chain Support Above $41,800

In a new post on X, analyst Ali talked about the various BTC support and resistance levels from an on-chain perspective. In on-chain analysis, the strength of any support or resistance level depends on the amount of Bitcoin that the investors bought at said level.

The chart below shows what the distribution of the different BTC price ranges currently looks like based on the concentration of holder cost basis that they carry.

As displayed in the above graph, the $41,800 to $43,100 range hosts the acquisition price of most Bitcoin out of all the price ranges listed. To be more specific, about 2.4 million addresses acquired 1 million BTC within this range.

The cost basis is naturally of immense significance for any investor, as the spot price retesting can flip their profit-loss situation. As such, holders become more likely to show some move when a retest like this happens.

A holder in profit before the retest might tend to buy more when the retest happens, as they might believe this same level that proved profitable earlier would do so again.

On the other hand, loss holders might want to sell at their break-even level since they may fear the cryptocurrency going down again, putting them underwater again.

These buying and selling moves aren’t enough to move the market when just a few investors are making them, but if a large number of investors have their cost basis inside a narrow range, the reaction could become significant.

Since those above $41,800 to $43,100 range is dense with investors, it should be an essential on-chain range. The spot price is floating above the range so that these prices could act as a support barrier for the asset. Based on this, Ali explains, “as long as Bitcoin maintains its position above $41,800, the outlook remains bullish.”

The chart shows that the Bitcoin ranges above the price aren’t carrying the cost basis of that many investors. This could imply that there isn’t much resistance ahead for the coin.

The analyst notes that this lack of major resistance also strengthens the potential for the cryptocurrency to stay at the current levels or push towards the higher ones.

BTC Price

Bitcoin has been gradually making its way back up after the recent crash, with its price climbing towards the $43,800 mark. The below chart shows how the asset has performed during the last few days.

Solana co-founder Anatoly Yakovenko has expressed confidence that their blockchain can handle the growing demand for decentralized applications (dapps) without needing layer-2 solutions like those employed by Ethereum.

Solana Doesn’t Need Layer-2 Solutions

In a post on X, Yakovenko argued that Solana’s design, which utilizes a hybrid consensus mechanism, enables it to scale efficiently without relying on additional layers. The co-founder explained that their goal is to eventually synchronize a global atomic state machine “as fast as the laws of physics allow.” With this stance, Yakovenko appears to be downplaying the role of layer-2 off-chain options like Arbitrum and Base.

“Solana aims to synchronize a global atomic state machine as fast as the laws of physics allow,” Yakovenko said on X. “In this end state, any layer-2, side chain, or zero-knowledge proof Valadium amounts to the same thing. They are external execution environments that cannot ensure atomic composition with the rest of the layer-1 state.”

Despite the position Yakovenko takes, the co-founder said the floor is open for developers to create layer-2 solutions. However, it won’t be necessary because the network can handle such demand without such workarounds. 

Ethereum Is Confident Layer-2s Will Be Key To Scaling

This stance contrasts Ethereum’s approach, which increasingly relies on layer-2 solutions to alleviate congestion and high transaction fees. Layer-2 options such as Optimism and Arbitrum have gained popularity for their ability to offload transactions from the mainnet while maintaining compatibility with existing smart contracts. 

To quantify their role in scaling Ethereum, L2Beat data shows that the layer-2 solutions have a combined total value locked (TVL) of over $20 billion. The largest of them is Arbitrum, which manages $10 billion of assets when writing on January 5.

Though Yakovenko’s comments reflect Solana’s focus on providing a high-performance, low-cost environment for apps, there have been instances when the network froze, calling its reliability into question. To resolve this, the platform plans to upgrade its client, adding the Firedancer for increased node reliability and performance. 

On the other hand, Ethereum seems to be going the layer-2 route. During their developer call, it was decided that Ethereum’s gas limit won’t be increased further from the 30 million gwei level. This, analysts concluded, meant the delay of on-chain scaling ambitions for off-chain methods, specifically off-chain and sidechain rails.

A recent crypto report has delved into the XRP price, forecasting the cryptocurrency to surpass the $1 peg in 2024. The report also included predictions for the cryptocurrency’s pricing over the next few decades. 

2024 Monthly Prediction

Popular cryptocurrency exchange, Changelly published a new XRP price report on January 5, providing a comprehensive forecast of the cryptocurrency for each month in 2024.

Before outlining its predictions, the crypto exchange delved into XRP’s past successes and hurdles between 2017 till date. In 2018, when XRP reached its price peak of $3.84, the cryptocurrency was valued as the world’s second most capitalized cryptocurrency after Bitcoin. 

XRP experienced a significant decline in the following years but recovered majorly in early 2021 during the bull run. Presently XRP is showing slight recovery after being in a three-year-long legal battle with the United States Securities and Exchange Commission (SEC). This optimistic sentiment and steady growth have contributed to the restoration of the cryptocurrency’s reputation, paving the way for positive price forecasts for XRP. 

According to Changelly, the value of XRP is expected to increase by 21.68% to reach $0.714 by January 6. It’s important to note that the price of XRP at the time of writing is trading at $0.577 as reported by CoinMarketCap.

Changelly has also forecasted XRP to reach an average price of $0.68 in January 2024. With a maximum and minimum price prediction of $0.79 and $0.58 respectively.

In February, XRP is expected to trade at an average value of $0.62. Its maximum and minimum price forecast is reported to reach $0.64 and $0.60 respectively. 

From March up until October, Changelly has predicted the value of XRP to range from $0.5 to above $0.6, without crossing the $0.7 price mark. 

Lastly, November and December price forecasts depict a bearish trend for XRP. The cryptocurrency is expected to be trading at average prices below $0.52 while the maximum and minimum trading price of XRP in December are projected at $0.54 and $0.37 respectively.

Changelly has reported its overall price prediction for XRP in 2024 to be around $0.93 on average. While the minimum and maximum price value of the cryptocurrency are assumed to be $0.90 and $1.10 respectively. 

XRP Price Prediction For 2025 To 2050

In its analysis of XRP, Changelly provided a brief report on the price prediction of XRP from 2025 to 2050. The crypto exchange forecasted the price of XRP to reach an average of $1.33 in 2025 with a maximum and minimum price value of $1.56 and $1.28 respectively. 

From 2026 up until 2029, XRP price is predicted to grow from an average of $1.84 to breach the $3 price mark and surpass $5 in 2029.

The year 2030 also shows a strong bullish growth for the price of XRP. According to Changelly from 2030 to 2032 XRP is projected to grow to an average price above $7 to cross the $10 price mark and surge to $17.32 in 2032.

The crypto exchange’s XRP price prediction for 2040 is set at an average trading price of $296.93, with a maximum and minimum price value of $341.26 and $272.51 respectively.

Lastly, for 2050, the XRP price value is expected to reach a staggering average price of $446.52. The maximum and minimum price projection for that year is set at $493.44 and $428.69 respectively. 

Taking to X on January 5, Antonio Juliano, the founder of dYdX, a decentralized exchange (DEX), expressed skepticism regarding the current crypto bull run. Juliano attributed the recent price surge to “light trading volumes.” This formation might, despite the overall confidence, not sustain the uptrend.

Founder: This Bull Run Is Different, Participation Is Low

Juliano asserted that a true bull cycle is not defined solely by price action but by participation and community enthusiasm. The founder continued that this “does not seem to be happening yet.”

The founder attributed the lack of widespread adoption to the absence of “groundbreaking” products that have captured the attention of a “broader” audience. However, releasing these “products” to the market could revive activity, driving crypto trading volume. 

Juliano’s comments come ahead of the potential approval of the first spot Bitcoin exchange-traded fund (ETF) by the U.S. Securities and Exchange Commission (SEC). Among several applicants are Fidelity, Grayscale, and BlackRock. Insiders claim the agency could approve the first product in the coming days. 

A spot Bitcoin ETF may open the floodgates to institutional investors, allowing them to gain exposure to the Bitcoin and crypto market in a regulated manner. As it is currently structured, willing institutions regulated by the SEC can only get exposure through Grayscale’s products, including the GBTC.

Along the same line, some commentators have speculated that the SEC’s approval of a spot Bitcoin ETF could lead to the approval of a spot Ethereum ETF in 2024. An Ethereum Futures ETF was approved in 2023 and is currently available for trading. Even so, the product, like Bitcoin Futures ETFs that are widespread, tracks an Ethereum index price, not the Ethereum spot rate. Even so, whether the SEC will greenlight a spot Ethereum ETF remains to be seen. 

Will A Bitcoin ETF Approval Revive DYDX Demand?

Trading volume is a critical metric for measuring participation and, thus, interest in a particular asset. The higher it is, the more liquid the asset is. 

Depending on the prevailing sentiment, this might support prices or lead to a sell-off. As the crypto community eagerly waits for the SEC to decide on the flagship product, altcoins, including DYDX, have been firm.

Looking at the DYDX price chart in the daily chart, prices are moving horizontally but relatively high from the October 2023 lows. 

The coin is up roughly 50% but remains under pressure in the short term. DYDX is down 40% from November 2023 peaks, trading below December 2023 lows in a bearish breakout formation.

The Bitcoin price saw a spike in volatility due to the decision around the spot Exchange Traded Fund (ETF). Market participants await an announcement at any point during the upcoming days, which will likely result in further spikes in volatility.

As of this writing, the Bitcoin price trades at $43,900 with a 1% profit recorded over the last 24 hours. Over the previous seven days, the cryptocurrency records a 3% increase, acting as the best-performing asset in the crypto top 10 by market cap.

Bitcoin Price Ready For A Massive Rally?

According to many analysts, the potential implications for the Bitcoin price should the spot ETFs get approval are “impossible” for the market to price in this event. Thus, the bullish effects of this approval can only impact BTC in the mid to long-term as capital enters the financial product.

On the other hand, volatility has been susceptible to sudden spikes, as mentioned above. In late 2022, any news related to the Bitcoin ETF moved the market by thousands of dollars, most notably, the report by the crypto news outlet Cointelegraph inaccurately announcing the financial product launch before receiving confirmation from the US Securities and Exchange Commission (SEC).

Developer Samson Mow claims this effect can benefit Bitcoin prices by pushing them beyond expectations. This week, two conflicting reports by analysis firm Matrixport pushed BTC back to critical support levels.

A similar effect might drive Bitcoin back above the $50,000 area. Mow stated:

Bitcoin dropped $5k on some fake news from a no-name analyst. Imagine what happens when a dozen ETFs are approved and start smash market buying. You may think an Omega candle is impossible, but it’s very real.

Confidence In BTC Grows Stronger

In support of the bullish thesis, trading desk QCP Capital pointed at the recent leverage “washed out” triggered by the Matrixport reports. Over $1 billion in long liquidations were triggered as BTC returned to the $40,000 level.

However, the cryptocurrency climbed back and re-took these levels’ mid-area. In a report, QCP Capital stated the following regarding Bitcoin’s potential to see a stronger rally in the mid-term:

For now, the topside remains capped by resistance at the 46 – 48.5k region with support at the 40.5 – 42k region. In spite of the leveraged washout, BTC has climbed back up to 44,000 level. While we remain wary of a “sell the news” knee-jerk reaction to the downside, this resilient price action gives us more confidence in the medium-term bullish view into BTC halving towards Mar/Apr this year.

Cover image from Unsplash, chart from Tradingview

The Shiba Inu Layer 2 Shibarium network is recovering once again after the festivities of the holidays have died down. This time around, the layer 2 network is celebrating a major milestone after a couple of months of impressive outperformance.

Shibarium Network Crosses 250 Million Transactions

The Shibarium network has now crossed a total of 250 million transactions that have been processed since it was launched last year. This latest milestone coincides with a significant recovery in the network’s daily transactions which had plunged at the start of the new year.

As NewsBTC reported on Thursday, the average daily transactions on the network had fallen around 50% from the 7 million average to 4 million. This decline would persist for at least two days, on January 2 and January 3, where an average of 4 million transactions were carried out.

However, there has since been another jump in the number of transactions processed by the network. Currently, the daily transactions for Friday are sitting at 6.19 million at the time of writing. This translates to a 50% jump from the numbers recorded over the last few days.

The total number of blocks produced has also risen rapidly at this time as well. As the data shows, there are now over 2.84 million blocks produced on the Shibarium network. If the daily transactions on the Shiba Inu layer 2 network continue to rise, then the total number of blocks produced could cross 2.5 million before the month is over.

Shiba Inu Burn Rate Mounts A Comeback

The transactions carried out on the Shibarium network are not the only thing making a comeback at this time. The Shiba Inu burn rate is also seeing a significant surge after being subject to a slow start to the year.

According to data from the burn tracking website Shibburn, there have been more than 4.2 million SHIB tokens burned in the last day. This figure translates to a 244% surge in the burn rate over this time, continuing the trend that was registered on Thursday.

The rise in the Shiba Inu burn rate shows that interest is not only localized to the Layer 2 network alone. But also, community members continue to work together in their bid to reduce the total circulating supply of the meme coin.

In the year 2023, the total number of SHIB tokens burned through this initiative has come out to more than 76 billion. However, this figure is minute compared to the over 400 trillion supply of the SHIB token, showing a need to ramp up burning.

Celsius Network, the bankrupt cryptocurrency lending company, is gearing up to unstake approximately $465 million worth of Ethereum (ETH) as part of its efforts to compensate creditors. This development follows the company’s bankruptcy filing in July 2022, leaving creditors in a prolonged 18-month wait for financial recompense.

Celsius’s decision to unstake a substantial amount of ETH is seen as a necessary step to ensure liquidity for creditor compensation. The company’s official announcement, made via X (formerly Twitter), highlights the strategic nature of this move:

“In preparation of any asset distributions, Celsius has started the process of recalling and rebalancing assets to ensure ample liquidity. Celsius will unstake existing ETH holdings, which have provided valuable staking rewards income to the estate, to offset certain costs incurred throughout the restructuring process. The significant unstaking activity in the next few days will unlock ETH to ensure timely distributions to creditors,” the announcement reads.

Celsius Responsible For Over 86% Of ETH In Exit Queue?

Blockchain analytics firm Nansen states that Celsius possesses approximately one third of the total Ether in the unstaking exit queue, totaling around 206,300 ETH. This figure translates to a market value of around $465 million. To date, Celsius has already withdrawn over 40,249 ETH.

Tom Wan, an on-chain data analyst at 21.co (parent company of 21Shares), elaborated on the situation, “Over 540k staked ETH (16,670 Validators) are currently withdrawing from the Ethereum Beacon chain. To fully exit and withdraw now, it will require 14.5 days.” The researcher added that 352,000 ETH (54.7%) waiting to be withdrawn belongs to Figment and 206,000 ETH (32%) belongs to Celsius.

“It is also likely that the withdrawal by Figment belongs to Celsius. Earlier in June, when Celsius redeemed 428.000 stETH from Lido, they have re-staked 197.000 ETH via Figment,” he added. Therefore, Celsius might be responsible for unstaking 86.7% of all ETH in the queue.

Ethereum Price Crash Looming?

While some investors express concern that the release of such a large volume of tokens from staking could adversely impact Ethereum’s price, others maintain a more composed outlook, believing that the market is robust enough to absorb this additional volume.

Even in the unlikely event that all ETH from the queue is sold, liquidity appears to be strong enough to absorb such a process, which would be gradual rather than sudden. According to Coinmarketcap, the current ETH trading volume stands around $11.35 billion, suggesting that the market could withstand the potential sale of Celsius’ entire ETH holdings without any major ETH price crash. Fear-mongering is therefore superfluous.

After receiving approval for its settlement plan, Celsius has allowed eligible users to withdraw 72.5% of their cryptocurrency holdings, with this option available until February 28. A court document filed in the previous September revealed that approximately 58,300 users possess a total of $210 million in assets, which the court has classified as “custody assets.”

At press time, ETH traded at $2,250. The 1-week chart for ETH/USD indicates that, over the past five weeks, the price of Ethereum has formed a consolidation range. The chart defines this zone with a lower boundary at $2,125, indicated by the red area, and an upper boundary at the 0.382 Fibonacci retracement level, located at $2,441.

On a high note, the crypto market starts in 2024, with BTC’s price rising steadily from $41,000 to around $46,000 as the Bitcoin ETF decision looms. The upcoming decisions by the U.S. Securities and Exchange Commission (SEC) on the BTC spot Exchange Traded Funds (ETFs) could lead to significant market fluctuations.

These decisions, expected between January 5th and 10th, have kept Bitcoin (BTC) and Ethereum (ETH), along with altcoins, on a tightrope with high funding rates indicating a preference for leveraged trades.

Crypto Market Braces For Bitcoin ETF Decision: Volatility Spikes The New Normal?

According to a report from options platform Deribit, the current market environment is hard to read with the usual indicators. Still, the readings across funding rates hint at a potential decline.

The anticipation of a price drop following the ETF announcement, a classic ‘buy the rumor, sell the news’ scenario, is in full swing. Nevertheless, the report claims the continued rise in crypto and sustained interest in trading BTC futures via the Chicago Mercantile Exchange (CME) highlights a growing enthusiasm for cryptocurrencies from traditional finance institutions.

History suggests that the crypto market often reacts more negatively to actual product launches than preliminary approvals. This was evident in events like the BTC CME futures launch and the Coinbase IPO. If the market prices are high during the launch of these new financial products, it might trigger a short-term sell-off, especially if they fail to meet flow expectations, Deribit stated.

However, any major price corrections should be “brief,” given the favorable macro environment, technical factors, and the build-up to Bitcoin’s halving. In case of decline, traders should watch the $40,000, $37,000, and $31,800 levels as potential support.

The volatility in Bitcoin and Ethereum has been noteworthy in the run-up to these ETF approvals, with Bitcoin’s implied volatility rising sharply to around 70, outperforming Ethereum. The current volatility levels are likely to decline following the Bitcoin ETF decision.

On the BTC volatility, the report stated the following forecasting a trend for the upcoming bull market:

Ethereum, while similar to Bitcoin, hasn’t yet reached inversion. That said, its long-term volatility is outperforming Bitcoin’s, suggesting optimism for Ethereum in 2024.

In that sense, traders should look for any downside momentum in the ETH/BTC trading pair. Deribit claims that any decrease in the price of ETH is a “buy opportunity,” as suggested by the current market structure.

Impact On Bitcoin Derivatives

The options market’s reaction to the upcoming ETF decision is subtle, with Bitcoin’s call skew recovering quickly after recent market fluctuations. Ethereum maintains a consistent call premium, indicating a marked shift in focus towards Ethereum following Bitcoin ETF approvals.

As for option flows and dealer gamma positioning, Bitcoin’s option volumes have decreased, with the market favoring buying in call spreads and selling in put spreads. In other words, derivatives player have been increasing their call positions in anticipation of the ETF decision in the US.

Regarding the impact of this decision, Deribit and others have provided their views, but one analyst believes that the long-term effect of a Bitcoin spot ETF can’t be measured at the moment. Via the social media platform X, this analyst stated:

It’s impossible for something to be “priced in” if a huge amount of capital literally doesn’t have access yet. Yes, currently eligible speculators and their available capital can buy ahead of an event. But that’s as far as any “pricing in” goes if the pool of participants is about to greatly expand. Note: this does not predict what will happen immediately after ETF approval.

Cover image from Unsplash, chart from Tradingview

The total value locked (TVL) on Ethereum layer-2 networks recently hit a new all-time high in January, a testament to the continued adoption of Ethereum. Layer 2 networks sit on top of the Ethereum blockchain and help scale it by processing transactions off-chain before sending data back to the main blockchain. 

According to data from L2BEAT, a layer-2 analytics platform, the TVL on these scaling solutions recently reached an all-time high of $21.16 billion, representing a 340% growth from the same day last year. 

Ethereum Layer-2 Networks Hit New Milestone

2023 was a great year for Ethereum, as the altcoin and its scaling solutions registered a steady increase in TVL despite strong competition from other networks like Solana and Cardano. Data from L2Beat shows the TVL on these scaling solutions started in 2023 with $4.81 billion but grew steadily throughout to end the year at $19.98 billion dollars, a 315% growth. 

This growth was particularly exacerbated in the last quarter of 2023 and continued into 2024. The TVL grew by $1.18 billion in the first three days of January to reach $21.16 on January 3, its current all-time high.

At the time of writing, the TVL is now at $20.41 billion, still up by 3.82% in the past seven days. A large fraction of this layer-2 TVL can be attributed to Arbitrum One, with the scaling solution currently having $10.05 billion worth of cryptocurrencies locked. 

OP Mainnet, formerly called Optimism, is second with a current TVL of $5.84 billion. 57% of this TVL is composed of OP tokens, compared to Arbitrum One, whose ARB token constitutes only 36% of the TVL. 

State Of The ETH Network

This massive growth shows that Ethereum users are flocking to layer 2 networks to escape high gas fees and congestion on the mainnet. Ethereum’s TVL also witnessed steady growth throughout the year, adding $7.6 billion in the last quarter of 2023. Data from DeFiLlama shows the TVL on Ethereum is now at $28.532 billion.

However, Ethereum has seen its daily active addresses and transaction count plunge in the last few months. Data from Artemis revealed the network is currently being surpassed by Solana and Sui in terms of daily transaction count. Recent competition from Solana prompted an analyst to describe Ethereum as digging its own grave by relying too much on its layer-2 networks for scalability.

Some layer-2 chains are also currently processing more transactions than Ethereum itself. L2BEAT puts the monthly transactions on zkSync Era and Arbitrum at 39.91 million and 35.54 million respectively, ahead of Ethereum’s count of 33.91 million transactions.

On-chain data shows the largest of the Ethereum whales have continued to buy more recently as their supply sets another new all-time high.

Largest Ethereum Wallets Have Been Rapidly Accumulating

According to data from the on-chain analytics firm Santiment, the largest non-exchange Ethereum wallets have continued to show some rapid accumulation recently.

The relevant indicator here is the “supply held by top non-exchange addresses,” which keeps track of the total amount of Ethereum that the 150 largest self-custodial wallets are carrying in their combined balance right now.

Naturally, the 150 largest non-exchange wallets would belong to the top whale entities of the network. As such, the trend in the metric can provide hints about the sentiment around the cryptocurrency among these humongous holders.

When the indicator goes up, it means that these whales are expanding their holdings currently. Such a trend naturally suggests that they are bullish on the asset at the moment.

On the other hand, the metric registering a decline can be bad news for the cryptocurrency’s price, as it implies that these large investors have decided to participate in some selling.

Now, here is a chart that shows the trend in the supply held by the top non-exchange Ethereum addresses over the past couple of years:

As displayed in the above graph, the supply held by these top 150 whales has been rapidly going up since April 2023. This would suggest that the rally in the early months of the year caught the attention of these large entities, leading them to accumulate.

Interestingly, the slump between August and October was also not enough to dissuade these holders, as they only continued to buy more. Likewise, these whales have continued to push through the latest plunge in the cryptocurrency’s price as well.

After the most recent buying spree, the supply of these top non-exchange Ethereum wallets has reached 56.25 million ETH, which is a new all-time high for the indicator.

In the same chart, the analytics firm has also attached the data for the supply held by the top exchange addresses. This metric naturally measures the total number of coins that wallets attached to centralized platforms are carrying currently.

While the self-custodial whales have ramped up their supply, the top 150 exchange-bound wallets have moved flat in the same period. At present, this indicator has a value of 9.46 million ETH right now, which is nearly the lowest level observed since June 2018.

Generally, one of the main reasons why investors deposit their coins to exchanges is for selling purposes. So the supply of these exchange whales remaining low is a positive sign.

The rapid accumulation that the self-custodial whale entities are showing, combined with the fact that the top exchange wallets are at low levels, could mean the long-term outlook may be optimistic for Ethereum.

ETH Price

While Bitcoin has already made some recovery from its crash, Ethereum has only been able to rebound a bit so far, as its price is trading around the $2,250 level.