Join us on this episode of “We Will Crypto” as we uncover the hottest news in the crypto sphere. Explore the remarkable $1 billion surge by Bitcoin miners, witness the unwavering resilience of Cardano, and delve into Sony’s groundbreaking Web3 partnership with Startale. Don’t miss out on these game-changing updates and be sure to subscribe to our podcast for regular insights into the dynamic world of cryptocurrencies.
Welcome back to We Will Crypto, your ultimate source for the latest news and insights in the world of cryptocurrencies. I’m your host Ananomyx, bringing you the most significant headlines from the rapidly evolving crypto industry. Today, we have an extended episode packed with intriguing stories that have been shaping the crypto landscape. Let’s jump right in.
Our first story takes us into the world of Bitcoin mining. According to analytics firm CryptoQuant, Bitcoin miners have sent over $1 billion worth of Bitcoin to cryptocurrency exchanges in the past two weeks. However, it’s important to note that they are not necessarily selling the tokens. Miners typically sell their BTC rewards to fund their operations, but most of the recently sent Bitcoin was recovered back to proprietary wallets. This massive movement of BTC to derivatives exchanges suggests that miners might be using their newly minted coins as collateral for derivatives trading, such as hedging. The rise in Bitcoin’s price, along with factors like spot Bitcoin ETF filings and increased trading interest, may have prompted miners to manage their reserves and holdings.
In related news, Bitcoin miners have sent a record-breaking $128 million worth of BTC to centralized crypto exchanges. This amount is equivalent to a staggering 315% of their daily revenue, according to on-chain analytics platform Glassnode. It’s worth mentioning that miners typically send their profits to exchanges to cover expenses and take profits. This spike in miner revenue sent to exchanges surpasses previous instances seen during the 2021 bull run. Despite this significant activity, Bitcoin prices have remained relatively stable, holding slightly above $30,000. However, the $31,000 price level is considered a major resistance, and if it cannot be broken, future losses are expected, especially if miners begin liquidating. Bitcoin mining profitability has seen a slight increase due to rising BTC prices, but miners continue to face challenges such as declining profitability, increasing hash rates and difficulty, and higher energy costs.
Shifting gears, let’s explore the market outlook for Bitcoin and other major cryptocurrencies. Crypto-services provider Matrixport has released a report indicating that bullish investors are gearing up for the “seasonal surge” of Bitcoin in July. Historical data shows that Bitcoin has experienced average gains of over 11% in July, with positive returns in 7 out of 10 months over the past decade. Matrixport predicts that Bitcoin will rally to $35,000, experience a retracement to $30,000, and then make another upward move to reach the $40,000 level. The report also sets a year-end target of $45,000 for Bitcoin. While summer typically sees consolidation for Bitcoin, a strong July rally often sets the tone for the following months. Investors are closely watching these trends to navigate the volatile crypto market.
In a groundbreaking legal ruling, the Seoul High Court Civil Division in South Korea has declared that Bitcoin should not be classified as money. This decision exempts Bitcoin from lending business regulations and interest rate restrictions in the country. The court case involved Company A and Company B, where Bitcoin was lent between the two entities. The court concluded that the existing regulations governing interest rates and loan businesses do not extend to cryptocurrencies like Bitcoin. The court explicitly stated that the contract involved virtual assets, not traditional currency, making the existing laws inapplicable. This landmark ruling means that interest rate limitations cannot be imposed when lending Bitcoin in South Korea. However, it’s important to note that the decision can still be challenged at the Supreme Court, the highest judicial body in the country.
Now, let’s delve into the evolving landscape of illicit activities within the crypto space. A report by TRM Labs reveals a significant shift in the preferred cryptocurrencies for illicit activities. Bitcoin, once considered the go-to currency for cybercriminals, has witnessed a decline in its share of illicit transactions. In 2016, Bitcoin accounted for a staggering 97% of illicit transactions, but that number has plummeted to just 19% in 2022. Instead, other cryptocurrencies like Ethereum and BNB Smart Chain have gained prominence in facilitating illicit activities.
The report also highlights the continued use of cash and traditional financial methods for criminal financing, indicating that crypto did not invent these criminal forms. While Bitcoin’s association with Ponzi schemes, darknet markets, and DeFi hacks still poses challenges, its share in terrorist financing has significantly reduced, with Tron emerging as the primary currency for such activities.
It’s worth noting that the crypto industry and regulators are actively working to combat illicit activities. As the industry matures and more robust regulations are established, the goal is to ensure the safe and legitimate use of cryptocurrencies while minimizing their misuse for unlawful purposes.
Now, let’s shift our focus to the technical outlook of some major cryptocurrencies. Starting with Bitcoin (BTC), the short-term outlook suggests a range-bound movement. However, the mid-to-long-term outlook remains bullish. BTC needs a decisive three-day candlestick close above $30,711 to trigger a buy signal and target the weekly Bearish Breaker’s midpoint at $35,260. If bullish momentum continues, a retest of the Bearish Breaker’s upper limit at $41,273 becomes possible. Nevertheless, bearish divergence on the RSI indicates a potential correction in the future.
Turning to Ethereum (ETH), we observe a promising technical setup. An ascending triangle pattern suggests a breakout above the $1,865 resistance level could lead to a substantial 45% rally, with a target of $2,915. The RSI and AO indicators further support this bullish outlook. However, a close below $1,639 would invalidate the bullish thesis and potentially result in a 15% descent to $1,408.
As for Ripple (XRP), the price has been trading within a range of $0.548 and $0.413 for some time. A breakout above $0.548, accompanied by a clear flip into support, would signal a buy signal with a target of $0.778. However, exaggerated bearish divergence on the indicators raises the possibility of a steep correction. A pullback below $0.413 could lead to a 17% correction to the next support level at $0.334.
Now, let’s zoom out and take a broader look at the market dynamics. Market data suggests that the price of Ethereum (ETH) is unlikely to reach $2,000 in the near future. Several factors contribute to this limited upside potential. Macro-economic conditions, including concerns about an economic downturn, corporate defaults, and the need for continued tightening by central bankers, pose headwinds for ETH. Additionally, the usage of decentralized applications (DApps) on the Ethereum network has seen a decline, with gas fees dropping and DApp active addresses decreasing. The total value locked (TVL) in Ethereum smart contracts has also reached its lowest level since August 2020.
Analyzing ETH derivatives markets further supports the bearish outlook. The futures premium and options skew indicate that professional traders are not heavily favoring bullish positions. The $1,920 resistance level has proven difficult to break, and with declining TVL, DApps use, and worsening macroeconomic conditions, bears have better odds of defending this price level.
While it doesn’t necessarily mean that ETH will retest $1,750, breaking the $1,920 level has become a significant challenge for ETH bulls in the short term. Overall, the market data suggests a more cautious outlook for Ethereum’s price in the near future.
Shifting our attention to the adoption of cryptocurrencies by traditional financial institutions, it appears that Wall Street banks and other major players are increasingly poised to enter the crypto industry. The presence of institutions like JP Morgan, Citibank, and Goldman Sachs at fintech conferences indicates a growing interest from the traditional finance sector. While crypto has initially attracted anti-establishment actors, their influence may diminish as regulators increase scrutiny, leading to more robust regulations and a changing landscape for crypto companies.
Some seasoned investors, such as Kevin O’Leary, anticipate a shift in the industry’s leading firms as they integrate with the global financial system and allow institutional participation. Recent developments, like BlackRock’s bid for a spot-based Bitcoin ETF and the involvement of other Wall Street titans in crypto, highlight the growing acceptance of digital assets. While some crypto enthusiasts express concerns about the intrusion of traditional finance, others view mainstream adoption as necessary for crypto’s long-term success.
In the regulatory realm, major cryptocurrency exchanges are tightening their Know Your Customer (KYC) policies. KuCoin, a significant exchange in terms of trading volumes, has announced the implementation of mandatory KYC checks starting from July 15, 2023. New users will be required to complete identity verification to access all services, while existing non-KYC users will no longer be able to deposit new funds but can still make withdrawals. This move aims to strengthen compliance with Anti-Money Laundering regulations and collect additional data related to customers’ business and risk profiles. KuCoin’s decision aligns with a broader trend among exchanges to combat cybercriminal activities and ensure the integrity of their platforms.
Lastly, in terms of industry partnerships, Sony, the Japanese conglomerate, has made a $3.5 million investment in Startale Labs, a developer of a homegrown blockchain in Japan. The investment is a direct funding from Sony, with the aim of merging Startale Labs’ technical capabilities in Web3 with Sony’s experience and business fields. The collaboration between the two entities has focused on incubation programs to promote Web3 development, and Sony’s investment is expected to further strengthen this collaboration. Startale Labs, led by CEO Sota Watanabe, is known for its work on the Astar Network, a layer-1 blockchain built on Polkadot. With the investment from Sony, Startale Labs aims to expand its team and enhance its efforts in advancing blockchain technology.
As the cryptocurrency industry continues to evolve, these developments in mining, illicit activities, technical outlooks, traditional finance integration, regulatory policies, and industry partnerships shape the overall narrative. It remains essential for market participants to stay informed about the latest trends and adapt their strategies accordingly. Thank you for joining us on this episode of “We Will Crypto.” Make sure to subscribe to our podcast for more insightful discussions and analysis, so you never miss a beat in the fascinating world of crypto. Remember to adapt your strategies accordingly and embrace the exciting opportunities that lie ahead. Stay tuned and stay crypto-savvy!