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$25 Billion Worth of Cryptocurrency was Held by Cyber Criminals in 2021; DeFi Thefts Up 1,330%

anton — Fri, 27 May 2022 07:21:14 +0000

Source: www.dreamstime.com

Cryptocurrency-based crimes increased in 2021, according to the Chainalysis Crypto Crime Report 2022. The report states that by the end of 2021, cybercriminals were responsible for $11 billion worth of fraud from illegal sources, compared to $3 billion the same time the previous year.

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The report adds that stolen funds were worth $9.8 billion, which is 93% of the total criminal balances. This was followed by darknet market funds which were worth $448 million. Scams were worth $192 million, fraud shops $66 million, and ransomware $30 million. In the same year, criminal balances rose from a low of $6.6 billion in July to a high of $14.8 billion in October.

Source: blog.chainalysis.com

The report further revealed that the US Department of Justice (DOJ) seized cryptocurrency worth 2.3 million from DarkSide ransomware operators who were found responsible for the Colonial Pipeline attack in 2021. The Internal Revenue Service, Criminal Investigation (IRS-CI) seized cryptocurrency worth over $3.5 billion in 2021, while the London’s Metropolitan Service seized cryptocurrency of £180 from a suspected money launderer in the same year. In February this year, DOJ seized cryptocurrency worth $3.6 billion which was connected to the 2016 Bitfinex hack.

According to the report, the funds liquidating time for administrators, darknet market vendors, and illicit wallets reduced by 75% in 2021. Ransomware operators stored their funds for 65 days on average before liquidating.

The report showed that each cybercriminal held cryptocurrency worth one million dollars or more, and 10% of their funds in 2021 were received from illicit addresses. The report also revealed that 4,068 cybercriminals held more than $25 billion worth of cryptocurrency. The group represented 3.7% of all cryptocurrency-related criminals, or cryptocurrency worth $1 million in private wallets. 1,374 cybercriminals received between 10-25 percent of their funds from illicit addresses, while 1,361 cybercriminals received between 90-100 percent of their total balance from illicit addresses.

Cybercriminals have laundered cryptocurrency worth $33 billion since 2017, with most of it moving to centralized exchanges. Decentralized Finance (DeFi) protocols recorded the highest growth in usage for money laundering at 1,964%. DeFi systems offer financial instruments without the need for intermediaries.

Source: blog.chainalysis.com

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“In nearly all of these cases, developers have tricked investors into purchasing tokens associated with a DeFi project before draining the tools provided by those investors, sending the token’s value to zero in the process,” stated the report.

The report adds that crypto worth $2.3 billion was stolen from DeFi platforms, and the value stolen from DeFi platforms surged by 1,330%.

Source: blog.chainalysis.com

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Chainalysis said that they managed to track the activities of 768 cybercriminals whose cryptocurrency wallets had enough activity to accurately estimate their location. According to the firm, much of the illegal activity happened in Russia, Saudi Arabia, South Africa, and Iran.

“Time zones of course only allow us to estimate longitudinal location, so it’s possible some of these criminal whales are based in other countries,” the firm stated in the report.

The post $25 Billion Worth of Cryptocurrency was Held by Cyber Criminals in 2021; DeFi Thefts Up 1,330% appeared first on Deficoins.io.

Crypto Crash Latest Update (May 21): Bitcoin below $30,000; ETH, Solana, BNB, ADA, XRP, DOT, Matic down up to 5%

anton — Thu, 26 May 2022 08:40:41 +0000

Source: www.cnbc.com

In the latest crypto news, the global crypto market cap shrunk again below $1.25 trillion in the last 24 hours, after reaching $1.28 trillion a day before. At the time of writing this article, the cryptocurrency market cap stood at $1.24 trillion according to CoinMarketCap data. Bitcoin price had also slipped below the $30,000 mark, reaching $29,195.

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Source: Google Finance

The global cryptocurrency market volume also reduced by 10.35% to $73.76 billion in the last 24 hours. The total DeFi volume stood at $7.03 billion, which is 9.54% of the total crypto market’s 24-hour volume.

Bitcoin price dropped by 3.26% in the past 24 hours. Bitcoin’s dominance as the leading cryptocurrency in the crypto market reduced by 0.18% to 44.64% within 24 hours. Overall, the Bitcoin price has dropped by 1.09% in the last 7 days.

Top Crypto Prices

Other top cryptocurrencies also recorded a price drop in the last 24 hours.

Ethereum price dropped by 2.85%, crossing the $2,000 mark downwards, reaching 1,963 in the last 24 hours. ETH price has dropped by 4.07% in the last 7 days. Ethereum is ranked as the second-largest cryptocurrency in terms of market capitalization.

Source: Google Finance

Binance coin’s (BNB) price dropped by 1.69% to $302 in the last 24 hours. BNB price has increased by $302 in the last 7 days. It is ranked as the 5^th largest cryptocurrency in terms of market capitalization.

XRP coin’s price dropped by 4.41% to $0.4113 in the last 24 hours. XRP price has dropped by 5.32% in the last 7 days. It is ranked as the 6^th largest cryptocurrency in terms of market capitalization.

Solana’s price dropped by 3.41% to $49.84 in the last 24 hours. Solana has recorded a 3.6% drop in price in the last 7 days. It is the 9^th largest crypto asset in terms of market capitalization.

ADA price (Cardano’s token) dropped by 1.95% to $0.5197 in the last 24 hours. ADA has recorded a 4.4% drop in the last 7 days. Currently, it is ranked as the 8^th largest cryptocurrency by market cap.

DOGE price also recorded a drop in price, decreasing by 2.75% to $0.08419 in the last 24 hours. It is ranked as the 10^th largest cryptocurrency by market capitalization.

Source: Google Finance

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Polkadot (DOT) and Avalanche (AVAX) prices dropped by 2.3% and 1.92% respectively in the last 24 hours. DOT and AVAX are the 11^th and 13^th largest cryptocurrencies in terms of market cap.

Polygon price dropped by 2.22% to $0.6413 in the last 24 hours. CoinMarketCap data shows that it is the 17^th largest cryptocurrency by market capitalization.

The post Crypto Crash Latest Update (May 21): Bitcoin below $30,000; ETH, Solana, BNB, ADA, XRP, DOT, Matic down up to 5% appeared first on Deficoins.io.

3 Red Flags that Signal a Crypto Project may be Misleading Investors

anton — Thu, 26 May 2022 08:38:01 +0000

Source: kenyanwallstreet.com

After releasing the Bitcoin code to the public, Satoshi Nakamoto showed the world how to establish a network and vanish without so much as a trace.

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Since then, the cryptocurrency ecosystem has seen the rise of many developers and protocol creators who become crypto messiahs for crypto holders whose best-laid plans end in a catastrophe in case the protocol is rugged, hacked, or left by whimsical developers.

The year 2022 has seen many good intentions go awry, and these have plunged the cryptocurrency market into bear-market territory. The following are examples of such instances and how to avoid similar outcomes in the future:

Some Crypto Network Developers Remain Anonymous for a Reason

Although Satoshi successfully remained anonymous when launching Bitcoin, most instances since then have shown that having anonymous developers can be a red flag.

Many cryptocurrency network developers cite personal safety as the reason behind remaining anonymous. This can be a valid reason for some cases, but in other cases, cryptocurrency developers choose anonymity to hide from previous misdoings or as a pre-planning to hide from being tracked in case of future offenses.

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A good example of this was the Squid Game (SQUID), a memecoin inspired by a Netflix show that rallied 45,000% in a few days after its launch, only for crypto traders to discover that they were not able to sell the coins on any crypto exchange platform.

Source: www.google.com

They also discovered that the developers were anonymous and they had blocked all social media channels from comments.

The crypto market participants are becoming distrustful of anonymous developers which can be seen in the negative reaction to the realization that the founder of the Azuki nonfungible token project had been involved in three other NFT projects that were finally abandoned, leaving the coin holders with worthless jpegs.

Another example of an anonymous developer going rogue happened in 2022 after it was revealed that the anonymous Wonderland (TIME) treasury manager @0xSifu was suspected of financial crimes, along with Michael Patryn, a QuadrigaCX co-founder.

Source: Twitter.com

This revelation led to the collapse of multiple popular projects like Popsicle Finance and Wonderland.

Anonymous developers remove accountability from the equation and are increasingly becoming a red flag when dealing with cryptocurrency projects.

Watch Out for Cult Personalities

Cases of cult personalities in the finance sector are not strange and cryptocurrency is not immune to this phenomenon.

Long-time crypto traders will remember Roger Ver being referred to as “Bitcoin Jesus” and leading plans to fork Bitcoin Core to create Bitcoin Cash (BCH). Another example is Billionaire Dan Larimer who helped EOS raise $4 billion during the Initial Coin Offering boom of 2017/2018. The two instances turned out to be cases of a fervent group of followers whose agenda was to propel each project forward.

Neither BCH nor EOS reclaimed their all-time highs in the 2021 bull market despite the hype about their future when the two projects were being launched. One of the reasons could be because part of the hype was from individuals who were behind the project.

Cryptocurrency investors should be vigilant when a developer is portrayed as incapable of doing wrong and know that the outcome of cult-like followings ripples beyond their crypto community.

Decentralization should involve the Community

Cryptocurrency traders should also be on the lookout for crypto projects that operate in a centralized manner while claiming to be decentralized.

Source: zipmex.com

It is common to find protocols that claim to be decentralized yet they depend on centralized service providers such as Amazon Web Services to ensure that they run smoothly.

Cryptocurrency investors should also watch out for projects that claim to offer token holders governance rights but makes a major decision without seeking approval or feedback from the community.

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One of the major principles of any cryptocurrency project is adherence to decentralization, failure to which leads to dissatisfied cryptocurrency investors and a compromised network.

The post 3 Red Flags that Signal a Crypto Project may be Misleading Investors appeared first on Deficoins.io.

Tether Pays Out $10bn in Withdrawals since the start of Crypto Crash

anton — Thu, 26 May 2022 08:29:42 +0000

Source: www.investopedia.com

In some of the latest crypto news, Tether stablecoin has paid out $10 billion in withdrawals since the start of the crypto crash in early May. The multibillion-dollar stablecoin acts as the largest bank in the cryptocurrency market.

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The pace of withdrawals is a clear indication that the cryptocurrency coin is effectively handling a slow-motion bank run, as the crypto depositors move their cash to more regulated stablecoins.

Public blockchain records indicate that $1 billion worth of tether was redeemed just after midnight on Saturday. As part of the withdrawal process, the cryptocurrency was given back to the company and destroyed.

$1.5 billion worth of tether had been withdrawn similarly three days earlier. The amount withdrawn is now causing minor fluctuations in the stablecoin’s peg to the U.S dollar, about 1/8 of all company reserves.

This redemption comes after Tether released information about its audited accounts to the public, which revealed that by late March, they had backed user deposits in a mixture of bonds in other private companies, US Treasury bills, and around $5 billion in miscellaneous “other investments” such as other cryptocurrency enterprises.

However, some cryptocurrency investors have raised questions on whether the accounts are as reassuring to depositors as they seem to be. If Tether’s cryptocurrency investments fell in value during the crypto crash, then it might have struggled to meet the customer deposits, a fintech analyst argued.

Just like other stablecoins, the tether cryptocurrency should always be worth a fixed amount, which is 1 US dollar. Tether achieves this by keeping a large reserve of stable assets. Retail investors are allowed to buy or sell tether on cryptocurrency exchanges such as Coinbase and CoinMarketCap, while institutional investors can simply pay money to Tether to get newly minted tokens, and are allowed to return the tokens to Tether in exchange for cash.

Source: learn.swyftx.com

Initially, Tether stated that their reserves were backed 1-to-1 with US dollars. However, an investigation conducted by the New York attorney general revealed that it was not always the case and Tether admitted that the cryptocurrency was backed by Tether’s Reserves. It then agreed to publish a quarterly statement detailing what those reserves were.

The latest statement released before the crypto crash shows Tether storing about $20 billion in commercial paper, $7 billion in money market funds, and almost $40 billion in US treasury bills, and all are stable investments. Tether has also stored another $7 billion in “corporate bonds, funds, and precious metals,” and other investments like digital tokens. Although this is a small portion of Tether’s Reserves, it opens Tether to the risk of breaking its promise of being “fully backed” in case of a large market fluctuation.

According to Patrick McKenzie, a fintech commentator at Stripe Payments Company, this could have already happened. Tether’s company accounts show that it has $162 more in reserves than the total outstanding tokens issued so far, McKenzie stated. However, just to give an example of public investment from Tether, some of the digital tokens held by the company are those of Celsius, a cryptocurrency investment platform.

“Tether has invested $62.8m of the reserves into Celsius network … Celsius is in freefall due to the current market dislocation; the value of their native token is down by over 86%,” said McKenzie.

“Clearly, that investment has suffered more than $20m in impairment. Impairment of 1% of one line item on their balance sheet ate more than 10% of their equity,” he added.

Paolo Ardoino, Tether’s chief technology officer, said this in a statement:

“Tether has maintained its stability through multiple black swan events and highly volatile market conditions and, even in its darkest days, Tether has never once failed to honor a redemption request from any of its verified customers.

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“This latest attestation further highlights that tether is fully backed and that the composition of its reserves is strong, conservative, and liquid.”

The post Tether Pays Out $10bn in Withdrawals since the start of Crypto Crash appeared first on Deficoins.io.

Ethereum co-founder Vitalik Buterin is not a Billionaire Anymore

anton — Thu, 26 May 2022 08:26:16 +0000

Source: fortune.com

The cryptocurrency crash has wiped out billions from the fortunes of blockchain traders all over the world, including the most prominent entrepreneurs.

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Now a prominent cryptocurrency boss, who is also a co-founder of one of the largest cryptocurrencies, has revealed that he has lost so much money that he is no longer a billionaire.

Cryptocurrency has been on a bearish trend for most of 2022 but dropped to new lows for the year this month, with one of the popular stablecoins losing 98% of its value in what seemed to many cryptocurrency investors as an impossibility.

Economic pain regarding cryptocurrency reached new heights last week after another blockchain plunged by 98% in just 24 hours.

Terra (UST), which has been ranking amongst the top 10 valuable cryptocurrencies globally, lost its peg to the US dollar earlier this month.

Cryptocurrency investors have pulled out, leaving the cryptocurrency markets in dire traits, with Bitcoin and Ethereum dropping to levels they have never reached since June last year.

Now 28-year-old Vitalik Buterin, the Ethereum co-founder, has announced that he has lost billions in the bear run. This has had a negative consequence on Vitalik Buterin net worth.

This is what the entrepreneur of the second-largest cryptocurrency in the world tweeted to his four million followers over the weekend:

Source: Twitter.com

The ether token has already lost 60% of its value after reaching an all-time high of $4,865.57 in November last year. At the time of writing this article, Ethereum was trading at about $2000.

Source: Google Finance

In November last year, when Ethereum and other cryptocurrencies such as Bitcoin had reached their all-time high, Mr. Buterin announced that he had ether holdings worth $2.1 billion, according to Bloomberg.

Six months later, half of that fortune has been erased.

Vitalik Buterin casually revealed his declining fortunes in a tweet thread where billionaires like Jeff Bezos and Elon Musk were being discussed, a club he doesn’t belong to anymore.

Ethereum is the second-largest cryptocurrency globally after Bitcoin, with a market cap of $245 billion.

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Vitalik Buterin and seven others co-founded Ethereum in 2013 while they shared a rented house in Switzerland just after his teenage years.

Currently, he is the only one working on the project.

However, the crypto crash has hit him and other Ethereum holders hard.

The post Ethereum co-founder Vitalik Buterin is not a Billionaire Anymore appeared first on Deficoins.io.

Coinbase Offers ‘Thousands of Tokens’ in Expanded Swap Service

anton — Thu, 26 May 2022 08:23:33 +0000

Source: www.cryptopolitan.com

Coinbase, the largest crypto exchange in America, has added BNB chain (formerly known as Binance Smart Chain) and Avalanche to the list of supported networks on Coinbase wallet where coin holders can store and swap cryptocurrency.

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A Tuesday’s blog post from the cryptocurrency exchange states that the new functionality will give cryptocurrency investors access to “thousands of tokens” which are a “greater variety than most traditional centralized exchanges can offer.”

Source: Twitter.com

The new functionality brings the total number of supported networks on Coinbase to 4, that is, BNB Chain, Avalanche, Ethereum, and Polygon. Coinbase wallet users who need to trade on-chain can use the in-app decentralized exchange (DEX) provided by Coinbase on 4 networks. However, they have not introduced a token bridging feature.

With Coinbase wallet, users self-custody their cryptocurrency. Coinbase wallet also provides on-chain access as opposed to the features provided on Coinbase’s central platform.

Currently, there are only 173 tokens listed on the Coinbase crypto exchange. This is a small number compared to the thousands of cryptocurrency tokens that Coinbase wallet users can now access across the 4 networks. The cryptocurrency exchange also stated that “we’ll be making it possible to conduct swaps on an even greater variety of networks” in the coming months:

“Not only will trading expand, but we’re also planning to add support for network bridging, allowing you to seamlessly move tokens across multiple networks.”

Network bridging is the process of sending cryptocurrency tokens across networks without relying on a centralized exchange (CEX). Some of the common token bridges are Wormhole and Multichain.

Although initially accessible to a small number of users, Coinbase is also set to release its web3 wallet and browser for the mobile app. This will provide mobile traders with access to a wide ecosystem of decentralized cryptocurrency exchange platforms on supported networks other than that of Coinbase.

Source: waxdynasty.com

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According to CoinGecko, BNB Chain had a trading volume of $74 while Avalanche had a trading volume of $68.5 billion in the last 24 hours.

The post Coinbase Offers ‘Thousands of Tokens’ in Expanded Swap Service appeared first on Deficoins.io.

Bitcoin-Stock Correlation at its Peak –Will It end? The Top Four Gainers in DeFi

anton — Thu, 26 May 2022 08:19:32 +0000

Source: seekingalpha.com

The most important crypto news in 2021 was the entry of institutional investors such as Tesla, hedge funds, and Wall Street banks into the cryptocurrency space.

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This was a sign of acceptance of cryptocurrency into the mainstream financial system. It also seemed to drive up cryptocurrency prices. The crypto market capitalization grew by 185% in 2021, making 2021 a boom year for the cryptocurrency industry. This saw cryptocurrencies such as Bitcoin hit their all-time high after rising to a Bitcoin price of about $69,000.

The crypto crash has erased about $1.25 trillion from the cryptocurrency industry’s all-time high market cap. This has left some crypto traders with the question, “Is the entry of institutional investors into the cryptocurrency industry worsening the situation?”

There has been an increasing correlation between the stock and cryptocurrency markets and the presence of institutional investors has exacerbated that correlation. Crypto prices slip when stocks fail.

This has led to the highest inflation level in the US, and the prices are most likely to stay high for some time.

With stocks and sentiment decreasing, Bitcoin dropped by 18% in April, making it its worst April in history. So far in May, Bitcoin’s price has dropped by 29%. Bitcoin is now entrenched at the $30,000 mark, struggling to keep its price above this level.

Source: www.statista.com

Bitcoin should be immune from monetary policy and economic concerns. So, why would it be affected?

The reason is the institutional interest in Bitcoin, which also explains the increasing correlation between Bitcoin and the S&P 500. They consider Bitcoin as a diversification asset instead of a long-term investment vehicle, and that’s why institutional flows into and out of the crypto market have a greater impact on Bitcoin price than the accumulation of long-term investors. This makes Bitcoin’s performance more reflective of the entire market.

Will this Correlation Last Forever?

The increasing correlation between Bitcoin and S&P 500 is an indication that the Bitcoin price is acting as a risk asset. However, its long-term accumulation is continuing and accelerating. This means that investors increasingly see Bitcoin as a reliable way of storing value.

This group of investors is expected to grow and it will have a great influence on Bitcoin prices than institutional investors who regularly move their funds in and out of crypto markets. Eventually, this will cause the correlation between stocks and Bitcoin to reduce and Bitcoin will finally regain its full power.

Top-Performing Defi Coin

Although decentralized crypto exchanges have been around for some time, their lack of liquidity has made it difficult to satisfy some user needs. The DeFi sector is now worth $18.84 billion and is expected to keep on growing.

The following are the top-performing Defi coin during the crypto crash:

IDEX

This Defi coin is unique in that it works like an order book as well as an automated market maker. It claims to be the first platform to combine the traditional order book feature with those of automated market makers.

Source: coinmarketcap.com

The IDEX token has gained 54.3% in the last seven days, making it the best performing DeFi token. However, the token is still 90% away from its all-time high attained in Sep 2021. At the time of writing this article, IDEX was trading at $0.084626 with a market cap of $54.90 million. This is according to CoinMarketCap data.

Kyber Network Crystal

The primary goal of Kyber Network is to provide easy access to liquidity pools and offer the best rates for decentralized exchanges, DeFi DApps, and other users. All Kyber transactions are on-chain, hence, they can be verified by any Ethereum block explorer.

Source: CoinMarketCap

According to Coin Market Cap, KNC is currently trading at $2.15, having gained about $34.3% in the last seven days. This makes it the second biggest DeFi gainer.

Vesper (VSP)

Vesper platform acts as a “meta-layer” for DeFi, directing deposits to opportunities with the highest yields within the risk tolerance of the pool. It is currently the third-largest DeFi gainer, after gaining 42.4% over the past week.

Source: CoinMarketCap

However, VSP has fallen from its all-time high of $79.51 attained on March 26, 2021, to an all-time low of $0.703362 on May 12, 2022. It has however made a 65.7% recovery from its record low. The coin is currently trading at $0.9933, with a market cap of $8.79 million.

Kava Lend (HARD)

This cross-chain money market facilitates lending and borrowing across blockchain networks. Lenders can earn yields by putting their money on the Kava Lend protocol, while borrowers can receive funds using collateral. HARD is currently trading at $0.25 with a market cap of $30,335,343.

Source: CoinMarketCap

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The post Bitcoin-Stock Correlation at its Peak –Will It end? The Top Four Gainers in DeFi appeared first on Deficoins.io.

Coinbase Becomes the First Crypto Company to Enter Fortune 500 List of Biggest US Companies

anton — Thu, 26 May 2022 08:13:51 +0000

Source: blocknity.com

Coinbase Global Inc. has become the first cryptocurrency company to enter the Fortune 500 list, a ranking of the biggest companies in the U.S by revenue.

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Although Coinbase has been struggling to meet the expectations of analysts during the crypto crash, the San Francisco-based crypto exchange recorded a great success in 2021 which propelled it to position 437 in the Fortune list of the biggest U.S companies.

Source: Twitter.com

Coinbase came to the spotlight after it went public via a direct listing in April 2021, less than a decade after its launch.

Before the company was directly listed, analysts had predicted that Coinbase could be launched with a valuation of $100 billion. However, it closed its first day of trade with a valuation of $61.

In 2021, Coinbase generated a revenue of $7.8 billion, just above the minimum of $6.4 billion that was needed for companies to be considered for listing in the Fortune 500. The 2022 list only considers the financial performance of companies in 2021. They set the threshold to $5.4 billion.

Source: businessyield.com

2022 has been a tough year for the cryptocurrency industry, with crypto prices having crashed and volumes decreasing. Although Coinbase has tried to diversify its revenue streams by opening its own NFT marketplace in early May, its marketplace only has about 2,900 unique active users.

Coinbase is still focusing on cryptocurrency trading as its major business, hence, the crypto crash has really hurt its business. Bitcoin, the largest cryptocurrency in terms of market cap and which takes up about 44% of the cryptocurrency market, is entrenched at the $30,000 mark.

Source: Google Finance

The entire crypto market has lost almost $1 trillion year-to-date, the worst for the cryptocurrency industry ever.

The ongoing crypto crash has heavily affected Coinbase as cryptocurrency investors slowed their activity. In the first quarter of the year, the trading volume on Coinbase stood at $309 billion, which is less than the $331.2 billion that analysts expected. The trading volume on the crypto exchange was down by 39% from the $547 billion that Coinbase recorded in the fourth quarter of 2021 when cryptocurrency prices hit their all-time highs.

The cryptocurrency exchange missed the expectations of analysts in the first quarter of the year, generating a revenue of $1.16 billion in the first three months and a net loss of $430 million. The crypto exchange’s revenue dropped by 53% from the $2.5 billion it had achieved in the fourth quarter of 2021.

Coinbase’s stock price has also declined. The stocks were trading at about $60 on Tuesday, with its shares having declined by 82% from the closing price of $328.38 recorded on the first day of its trading last April.

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Although Coinbase had plans to triple the size of its company in 2022, Emilie Choi, its chief operating officer, announced that the company will be scaling back hiring, one of the reasons being the ongoing crypto crash. The cryptocurrency exchange managed to hire 1,200 people in the first quarter of the year. Currently, Coinbase has over 4,900 employees according to data on its official website.

The post Coinbase Becomes the First Crypto Company to Enter Fortune 500 List of Biggest US Companies appeared first on Deficoins.io.

Ethereum Risks a 25% Crash as ETH Price forms Classic Bearish Technical Pattern

anton — Sat, 21 May 2022 07:30:46 +0000

Source: time.com

Eth price is in danger of dropping further despite making a 20% rebound in the last few days. The price of the token seems ready to undergo a breakdown move in May having formed a convincing “bear peanut” structure.

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Will Eth Price drop to $1,500?

Ethereum price has shown a significant increase in bearish volume, raising the idea of a $1,500 price target among crypto investors and experts. The bears have left a ramping pattern on the volume indicator, which could signal a further drop in ETH price. If the current technical indicators are correct, Ethereum may present an opportunity for crypto traders to take short positions.

Ethereum price has been inside a range defined by two converging trend lines since May 11. The sideways moves coincide with a decrease in trading volumes, meaning that the Eth/USD pair is not painting a bear pennant.

Bear pennants are simply bearish continuation patterns that resolve after the price breaks below the lower trend line of the structure and then fall by the same height as the height of the previous downside move (known as the flagpole).

Source: cointelegraph.com

Due to this technical rule, Ether is at the risk of closing below its pennant structure, and then additional moves to the downside will follow.

Eth’s flagpole has a height of around $650. Thus, if Ethereum price undergoes a breakdown at the apex point of the pennant near $2,030, the bearish target of the structure will be below $1,500. This will be a 25% drop from ETH price of May 15.

Selloff, Pullback

The profit target for the bear pennant falls into an area that preceded a 250% price rally during the February to November 2021 session. The price is also around Ether’s 200-day exponential moving average, currently near $1,600.

The demand zone may prompt ETH traders to hold their coins as they anticipate a sharp upside retracement.

If this happens, the interim profit target for ETH price will likely be the multi-month downward sloping trend line that has acted as the resistance line in a “Falling channel” pattern. The following chart demonstrates this:

Source: cointelegraph.com

Ethereum has been rebounding after testing the demand zone, and the lower trend line of the falling channel as support. This may push ETH/USD price to the upper trend line of the channel near $3,000, about 50% above ETH price of May 15, by June. This will be a 33% increase from the current Ethereum price.

Extended Breakdown Scenario

A worst-case scenario could occur if ETH price breaks below the demand zone, caused by macro risks and their effect on the cryptocurrency market in 2022.

Ethereum price has already declined by over 50% as cryptocurrency investors dump riskier assets such as Bitcoin and tech stocks in an environment where high-interest rates are being charged.

Traders also anticipate additional stock market selloffs, which could hurt cryptocurrency such as Ether, Cardano, Bitcoin, and others.

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BOOX Research, who is a financial blogger at SeekingAlpha, maintains his long-term bullish position on Ether, Bitcoin, and the large crypto market but believes that it may take some time for the recovery to occur.

The post Ethereum Risks a 25% Crash as ETH Price forms Classic Bearish Technical Pattern appeared first on Deficoins.io.

Bitcoin Sees 7 Straight Weeks of Losses for the First Time

anton — Sat, 21 May 2022 07:27:25 +0000

Source: www.analyticsinsight.net

Bitcoin has seen 7 straight weeks of losses for the first time in history. This comes amid a downturn in crypto markets, rising retail interest rates, stricter cryptocurrency regulations, and systemic risks in the cryptocurrency sector.

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Bitcoin almost reached the $47,000 level in mid-march in a run that lasted for a number of weeks after falling to $37,000 from the November 2021 all-time high of about $69,000.

Since mid-March, Bitcoin price has been falling every week. According to CoinDesk, Bitcoin could reach $20,000 if the current market conditions continue.

Bitcoin, which is the largest cryptocurrency by market capitalization, has for a long time been positioned as a hedge against inflation, or an investment to protect against the reducing purchasing power of currencies and other assets.

However, that has not happened so far, but instead, Bitcoin has been highly correlated with global markets, even trading similar to tech stocks in the past few months. Some analysts have also reported that crypto investors are selling Bitcoin as it advances.

Source: www.statista.com

“In our view, the trend of selling cryptocurrency on upside movements remains. Adding to the downside is the bleak outlook for U.S. monetary policy, where no light at the end of the tunnel with rate hikes can be seen yet,” Alex Kuptsikevich, a FxPro market analyst, wrote in an email.

“We expect the bears not to loosen their grip in the coming weeks. In our opinion, a turnaround in sentiment may not come until the approach of the 2018 highs area near $19,600,” Kuptsikevich added.

Last week, Bitcoin price slipped to $24,000 as stablecoin tether (USDT) lost its peg to the U.S dollar for a while. Crypto investors were also faced with the crash of Terra’s Luna, whose price fell to $0, leaving the coin worthless.

According to CoinDesk, inflation has contributed to the fall of Bitcoin in the past several weeks. Earlier this month, the U.S Federal Reserve raised interest rates by the largest amount since the year 2000.

In April, analysts at Goldman Sachs stated in a note that Fed’s new measures to control inflation could lead to a recession. The investment bank attributes this to an economic contraction, a phase in the business cycle in which the economy declines as a whole, by about 35% in the next two years.

These sentiments were reiterated over the weekend by Lloyd Blankfein, the former CEO of Goldman Sachs, saying that the U.S economy was at a “very, very high risk.” Such an economy can lead to a drawdown in U.S equities, which can spread to Bitcoin and result in more sell-offs in the coming weeks if the correlation continues.

The risks of sell-off could have started to show. Grayscale Bitcoin Trust (GBTC), the world’s biggest Bitcoin fund estimated to be worth $18.3 billion, reported that its market discount widened to an all-time low of 30.79%. The discount can be interpreted as a bearish indicator because it could be signaling a reducing interest in Bitcoin among crypto traders and investors.

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GBTC helps cryptocurrency traders in the U.S to know more about Bitcoin price movements without having to purchase the actual cryptocurrency.

Currently, Bitcoin is trading at about the $30,400 mark on most crypto exchange platforms.

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