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  • Inflows into Bitcoin products surged by $116 million last week

    Inflows into Bitcoin products surged by $116 million last week

    • Digital asset investment products saw inflows of about $117 million last week, the biggest since July 2022.
    • Bitcoin saw almost all of last week’s digital asset investment products inflows, with $116 million of the total.
    • Total assets under management (AUM) rose $28 billion, roughly 43% from inflow lows recorded in November.

    Bitcoin saw the most fund inflows this past week, with the benchmark cryptocurrency accounting for nearly all of the weekly inflows.

    According to a weekly report digital asset manager CoinShares shared on Monday, crypto asset investment products recorded inflows of $117 million. It was the biggest week for inflows across digital asset investment products since July 2022.

    Bitcoin products saw inflows of $116 million

    Bitcoin accounted for nearly $116 million of the total digital assets products inflows. And as Bitcoin price rose above $23,000, inflows into Short Bitcoin products represented $4.4 million of weekly totals. 

    In other cryptocurrencies, inflows into Ethereum were $2.3 million and $1.1 million for Solana. 

    However, multi-asset investment products saw a ninth consecutive week of outflows with $6.4 million. Binance and XRP also saw outflows of around $400,000 and $200,000 respectively.

    The spike in inflows pushed total assets under management (AUM) to over $2.8 billion, with the metric up by 43% from its November low. Investment products also saw an improvement in terms of weekly volumes.

    Per the CoinShares report, $1.3 billion was traded, up 17% compared to the year-to-date average. The volume was also higher compared to the average of 11% for the broader crypto market.

    In terms of various regions, Germany saw about 40% of the inflows for approximately $46 million, while Canada, the United States and Switzerland saw the next three largest inflow batches with $30 million, $26 million and $23 million respectively.

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  • Inflows into Bitcoin products surged by $116 last week

    Inflows into Bitcoin products surged by $116 last week

    • Digital asset investment products saw inflows of about $117 million last week, the biggest since July 2022.
    • Bitcoin saw almost all of last week’s digital asset investment products inflows, with $116 of the total.
    • Total assets under management (AUM) rose $28 billion, roughly 43% from inflow lows recorded in November.

    Bitcoin saw the most fund inflows this past week, with the benchmark cryptocurrency accounting for nearly all of the weekly inflows.

    According to a weekly report digital asset manager CoinShares shared on Monday, crypto asset investment products recorded inflows of $117 million. It was the biggest week for inflows across digital asset investment products since July 2022.

    Bitcoin products saw inflows of $116 million

    Bitcoin accounted for nearly $116 million of the total digital assets products inflows. And as Bitcoin price rose above $23,000, inflows into Short Bitcoin products represented $4.4 million of weekly totals. 

    In other cryptocurrencies, inflows into Ethereum were $2.3 million and $1.1 million for Solana. 

    However, multi-asset investment products saw a ninth consecutive week of outflows with $6.4 million. Binance and XRP also saw outflows of around $400,000 and $200,000 respectively.

    The spike in inflows pushed total assets under management (AUM) to over $2.8 billion, with the metric up by 43% from its November low. Investment products also saw an improvement in terms of weekly volumes.

    Per the CoinShares report, $1.3 billion was traded, up 17% compared to the year-to-date average. The volume was also higher compared to the average of 11% for the broader crypto market.

    In terms of various regions, Germany saw about 40% of the inflows for approximately $46 million, while Canada, the United States and Switzerland saw the next three largest inflow batches with $30 million, $26 million and $23 million respectively.

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  • 30+ million Bitcoin addresses are in profit after BTC spike

    30+ million Bitcoin addresses are in profit after BTC spike

    • Bitcoin addresses in profit is at a 9-month high of 30+ million.
    • More unique addresses in profit were last above 30 million in early April 2022.
    • Non-zero addresses also hit a 1-month high while addresses with 0.01+ BTC is at an all-time high.

    The number of Bitcoin addresses that are currently in profit has reached a 9-month high, on-chain data shared by crypto platform Glassnode shows.

    Per the metric, the percentage of unique addresses with Bitcoin funds in profit were 30,081,429 on Monday morning. The figure is a 7-day moving average measure and shows the current value of BTC in the wallets compared to the average buy price.

    Therefore, these 30 million plus BTC addresses currently hold coins that were valued lower at the time of their purchase when compared to their current value.

    Chart showing number of BTC in profit. Source: Glassnode.

    Addresses with 0.01+ coins hit all-time high

    At the time of writing, Bitcoin’s addresses in profit (7-day moving average) sat at a 9-month high after Bitcoin’s latest price action. The last time these many BTC addresses were in profit was in April-early May 2022 – with this happening as the events of Terra and Three Arrows Capital collapse helped to push prices below $40k.

    Bitcoin eventually sank to lows of $15,600 in November amid the FTX-triggered sell-off that likely saw more people buy Bitcoin.

    Now BTC is up more than 40% in 2023 and is currently above the $23,000 price level, helping add over 7 million more unique addresses into the profitable bracket as prices began to soar in January.

    Meanwhile, the number of non-zero addresses has also increased, reaching a 1-month high of over 43 million. Indeed, the number of addresses with 0.01+ coins has recently hit an all-time high of 11,484,618, according to on-chain data Glassnode shared early Monday.

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  • Bitcoin price prediction ahead of Fed decision, NFP data

    Bitcoin price prediction ahead of Fed decision, NFP data

    • Bitcoin price declined slightly on Monday after nearing the resistance at $24,000.

    • Macro factors will be the key drivers for Bitcoin and other asset prices.

    • Consumer confidence, Fed decision, and NFP data will be in focus.

    Bitcoin price pulled back slightly on Monday as investors started focusing on the key economic data from the US and the upcoming Fed decision. The BTC price was trading at $23,125, which was a few points below this year’s high of near $24,000.

    Fed decision and NFP data

    Macro data and events will be the key things that will drive the price of Bitcoin – and other assets this week. On Tuesday, the Conference Board will publish January’s consumer confidence data. This is an important figure that is watched closely by investors and policymakers because of the vital role that consumer spending plays in the economy. Economists expect that confidence continued rising in January as inflation eased.

    The US consumer confidence data will be followed by the first FOMC decision of the year. With inflation easing and stocks and crypto prices rising, analysts believe that the Fed will deliver the second consecutive 0.50% hike. It will be extremely hawkish in a bid to reduce the enthusiasm among investors and traders.

    In theory, an extremely hawkish tone will be bearish for the price of Bitcoin. Historically, crypto prices tend to rally in periods of easy money policies. However, in reality, there is a possibility that Bitcoin will rise even if the Fed sounds hawkish. That’s because investors may not believe the tone of the FOMC officials.

    The Fed will likely guide to two more 0.50% rate hikes followed by a pause on interest rates as it seeks to lower inflation.

    Finally, Bitcoin price will react to the latest non-farm payrolls (NFP) scheduled for Friday this week. These numbers will be important because they will guide the Fed in making its future decisions. Strong jobs numbers mean that the bank will continue sounding more hawkish in the coming meetings. 

    Bitcoin price prediction

    BTC/USD chart by TradingView

    The BTC price has been in a strong bullish trend in the past few weeks. It has formed an ascending channel shown in black. The coin has moved above all moving averages. Further, it has moved above the important support at $21,615, the highest point on January 18. 

    Therefore, there is a possibility that Bitcoin will pull back slightly ahead of the Fed decision and then rebound after the decision. As such, the coin could retest the support at $22,000 and then rise to $25,000.

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  • Bitcoin trading at $38,000 in Nigeria, as Africa’s biggest economy in turmoil

    Bitcoin trading at $38,000 in Nigeria, as Africa’s biggest economy in turmoil

    Key Takeaways

    • Bitcoin is trading at $38,000 in Nigeria, a premium of 66%
    • The Nigerian central bank has implemented ATM withdrawal limits of $43 per day in push towards a cashless society for Africa’s biggest economy
    • The central bank also announced a rival card system to Visa and Mastercard, in a bid to reduce fees
    • Some are excited at the push towards Bitcoin, but it is important to remember Bitcoin’s failings here, too, writes our Analyst Dan Ashmore 
    • Internet penetration rate is only 35% in Nigeria, while Bitcoin’s volatility means assigning it any kind of “hedge” role would be idealistic

    One Bitcoin is trading for north of $38,000 in Nigeria. 

    The price can be seen on the Nigerian exchange NairaEx, where it is quoted at 17.8 million Naira. That equates to $38,600, despite Bitcoin trading at $23,200 across the market, meaning it is trading for a 66% premium in Nigeria.

    Nigeria shifting to a cashless society

    The premium comes amid a time when the Nigerian central bank is making a big push towards a cashless society. 

    Limits on ATM withdrawals have been implemented, with citizens limited to withdrawing 20,000 Naira per day ($43 at current rates) and 100,000 per week ($217). 

    Nigeria’s controversial money management

    The central bank also extended the deadline this weekend for citizens to exchange old banks notes from Jan 24th to Feb 10th. Higher denomination naira notes had been designed with the goal of reducing counterfeiting and the use of cash in society. 

    The move was widely criticised, with analysts pointing towards one very obvious question: how does issuing new bank notes reduce the use of cash? Nigeria is Africa’s largest economy and remains heavily dependent on cash.

    Aside from big-picture questions, Nigerians decried that they had not been given enough time to make the switch to the new notes. Tales of queues at banks were plenty, while many of Nigeria’s 210 million people live in rural areas and have no access to banks, where they are required to swap old notes for new. 

    The government had announced a scheme only one week before the deadline to help those in such rural areas via banking representatives, but controversy remained that there was not enough time. There were also reports of shortages of new notes, with commercial lenders only getting their hands on the new notes less than a month before the deadline. 

    “I don’t have good news for those who feel we should shift the deadline; my apologies”, central bank governor Godwin Emefiele had said only last Tuesday.

    Nonetheless, the central bank eventually caved, with political pressure mounting ahead of the presidential elections in a few weeks’ time. 

    Could Bitcoin help Nigeria?

    The chaotic developments are just the latest example of how poorly governments around the world often manage money. Nigeria has been no stranger to inflation historically, either. 

     

    Zooming in on 2022 shows that the last year has seen the currency devalue at a significantly higher rate than most developed economies worldwide. 

     

    Against this backdrop, the central bank also announced the launch of a domestic card scheme last week. The goal is to create competition for Visa and Mastercard, again pushing Nigeria towards a cashless society while saving the country on foreign transaction fees. 

    The goal may be admirable, but the realities of the situation make the push difficult. As mentioned above, this is a society still hugely dependent on cash, with a massive chunk of the population shut out from banking. 

    Some Bitcoiners are pointing towards the crypto as a solution for Nigerians. To me, this feels a bit idealistic. While there is no doubt that Bitcoin is extremely accessible compared to banking in developed countries, it does still require an Internet connection. And in Nigeria, that is not as readily available as desired. 

     

    While the fundamentals of Bitcoin certainly make it interesting in the context of a currency under severe controls and with a historical flirtation with inflation, let us not gloss over the fact that Bitcoin has issues of its own. 

    One Bitcoin was worth $68,000 a little over a year ago. Then it was $16,000 towards the end of last year. Now it is $23,200. For those living in rural Nigeria, this volatility would be back-breaking, and quite simply makes it totally unfeasible right now, despite the clamour coming out of Bitcoin enthusiasts. 

    I do think – and have written about this extensively previously – that Bitcoin has really intriguing attributes with regard to developing economies and collapsing currencies, and what could happen if the asset continues to mature. 

    However, in the year 2023, it is an extreme risk-on asset that couldn’t be less suitable to store one’s wealth in. The Naira may be feeling inflation of 20%+ right now, but Bitcoin can slice 50% of its price in a day. 

    Why is the Bitcoin premium so high?

    The way I like to look upon this is like the Big Mac index with purchasing power parity. A fun metric to gauge how expensive a country is, the Big Mac Index compares the price of the universal good that is McDonald’s most famous burger from country to country. 

    In a similar way, looking at the price that Bitcoin trades at can provide hints as to how well a nation’s money is functioning. The 66% premium in Nigeria clearly highlights that there is some real turmoil in the economy. Citizens willing to pay such an enormous markup to get their cash out of Naira is startling. 

    Then again, there could be other factors in play. The Kimichi premium famously persisted for many years, describing the constant premium that could be seen in the Korean bitcoin market. This was primarily a result of regulatory issues surrounding the always-controversial Bitcoin. 

    If nothing else, this tale out of Nigeria shows quite how fragile a lot of the world is with regard to money. With these episodes happening increasingly regularly, as well as those in Argentina, Lebanon, Turkey and so on, it is no surprise that there is a growing clamour for the mysterious, decentralised asset that we all call Bitcoin. 

    But claiming Bitcoin is anything close to a solution right now would be naive. As for the future, well who knows?

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  • What is the Bitcoin hash rate? And why is at all-time highs?

    What is the Bitcoin hash rate? And why is at all-time highs?

    Key Takeaways

    • The Bitcoin hash rate is the amount of computing power contributed towards mining
    • It has continued to take new all-time highs
    • This squeezes miners’ profitability, at a time when electricity costs have risen and the Bitcoin price has fallen
    • Overall, a high hash rate implies a healthy and more secure Bitcoin network

     

    “All-time high” is a phrase I haven’t used in a while when covering the cryptocurrency space. But if you look, there is something that continues to hit higher highs, and that is the Bitcoin hash rate.

    Bitcoin’s hash rate refers to the amount of computing power that is being contributed to the network through mining. And as the chart below shows, its inexorable rise during the pandemic does not seem to be slowing down. But what does this mean, and why is it rising?

    What is the Bitcoin hash rate?

    Gone are the days when anyone could mine on their personal computer. Today, mining is dominated by large mining pools, using specialised computers specifically designed for this purpose.

    The practice of mining actually involves these computers solving complex mathematical puzzles. Once this puzzle is solved, the latest block of transactions can be validated and attached to the blockchain, before the process repeats regarding the next block and the next mathematical puzzle. Once a puzzle is solved and a block validated, the miner responsible for this work gets paid in newly created bitcoins.

    This is all very complicated, but what is important to understand is that Bitcoin is programmed to release a specific number of Bitcoin over time, with the blockchain coded such that a new block is added (validated) every ten minutes.

    But as more computers join the network and the hash rate increases, these puzzles should get solved quicker, meaning quicker block time and more bitcoins released. Right? Well, here is the thing. A difficulty adjustment is coded into Bitcoin – that means that the more computing power that joins the network, the harder it is to solve those puzzles.

    Don’t ask me how this works, because I don’t even come close to understanding what is under the hood of the mythical beast that is the Bitcoin blockchain, but the main point is that as more miners join, the difficulty goes up.

    And as Bitcoin has become more popular (and risen in price), that is exactly what has happened. More miners have joined the network, and today it is a highly advanced process. Ten years ago, when only few miners existed, you and I could have pulled out our laptops and mined to a reasonable degree.

    Why is at all-time highs?

    There are a number of reasons why hash rate continues to surge to new highs. But the bottom line is that the increase in miners causes the hash rate to climb.

    Thus the question really asks why miners are continuing to join, when the price of Bitcoin has been plummeting. There are a couple of potential answers here.

    The first is that during the pandemic bull run, mining equipment was scarce and prices for items such as chips were sky-high. Many miners ordered new mining rigs during the bull run, but only received the equipment recently (or some, not even yet).

    Additionally, as the price of Bitcoin fell, the profitability of mining also decreased, given miners’ revenue is denominated in Bitcoin. New mining equipment has been developed and is selling for a lower price than previously, helping to push the number of miners higher.

    One other theory is the Ethereum Merge. This took place in September, when Ethereum transitioned from Proof-of-Work to Proof-of-Stake, meaning mining on the network ceased. Hence, some of these out-of-work Ethereum miners transitioned across to Bitcoin mining.

    What does a higher hash rate mean?

    The first consequence of an increasing hash rate is obviously greater pressure on miners. More competition and a higher required hash rate squeeze their profitability, especially at a time when electricity costs have risen and revenue (Bitcoin) has fallen.

    The best way to see this is to glance at the share price action throughout 2022 of some of the public mining companies.

    On the positive side, the Bitcoin hash rate is considered a security metric for the network. The higher the hash rate, the more secure the network, so in that context, the all-time high represents a good thing.

    This is why a high hash rate is generally looked upon favourably, as it implies a healthy network. Only problem is, miners are feeling the squeeze.

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  • El Salvador’s volcano-powered Bitcoin City wins design award

    El Salvador’s volcano-powered Bitcoin City wins design award

    • El Salvador is the first country that recognised Bitcoin as legal tender.
    • Bitcoin City has been recognised as a sustainable and highly efficient project.
    • El Salvador is building the new city in the country’s East, with clean energy entirely sourced from nearby volcanoes.

    El Salvador made history when it became the first country in the world to adopt Bitcoin (BTC) as legal tender. The country also announced an ambitious project dubbed ‘Bitcoin City’ – a move that continues to inspire many other nations and jurisdictions across the world.

    Importantly though, and in one of the many positive news around the El Salvador Bitcoin bet, the eco-friendly project Bitcoin City has just received international recognition.

    According to a news report by Noticias de Bariloche, Bitcoin City won an award after getting a thumbs up approval from a panel of experts over its architectural design.

    The award was given by LOOP, a Costa Rica-based sustainable architecture and design studio. Per the the LOOP Designs Awards 2022 website, Bitcoin City was picked as category winner from a pool of 705 submissions from 56 countries.

    Volcano-powered Bitcoin city

    EL Salvador’s Bitcoin City is a new city project under development in the country’s East, and is designed by Fernando Romero Enterprise EE, a Mexico-based design studio. The project features revolutionary urban planning with Bitcoin and nearby volcanoes powering financial investments and everyday activities.

    The two volcanoes (Tecapa and Conchagua) will provide clean energy.

    “A number of incentives for investors will make this city a reference on how to make a city both efficient and sustainable at the same time,” LOOP wrote in a brief description of the project.

    As CoinJournal previously reported, building Bitcoin City is expected to take at least ten years.

    El Salvador proves critics wrong on Bitcoin bet

    On Tuesday, El Salvador president Nayib Bukele slammed international media for their negative reporting on the country since it adopted BTC as legal tender. His comments came as the country repaid in full its $800 million in maturing bonds – despite Bitcoin price plummeting in 2022.

    Mainstream media reports had pointed out that El Salvador risked defaulting on the payments if it failed to strike a deal with the International Monetary Fund (IMF). President Bukele slammed the forecasts by “experts” and rating firms for their “lies”.

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  • Why is Ethereum being outperformed by Bitcoin? Historical pattern changing in 2023

    Why is Ethereum being outperformed by Bitcoin? Historical pattern changing in 2023

    Key Takeaways

    • Ethereum has historically outperformed Bitcoin in bull runs
    • The pattern has flipped to start the year, with Bitcoin dominance rising 
    • Our Analyst Dan Ashmore jumps on-chain to look through history, and show how and why the pattern is changing

    The Flippening, huh? Nothing incites debate within crypto circles quite like it. 

    Referring to a scenario where Ethereum flips Bitcoin for the number one spot in the cryptocurrency ranks, the Flippening is anything from inevitable to delusional, depending on who you ask. 

    I’m not sure I want to walk across the eggshells of that debate, for fear of my Twitter DMs, but I noticed something pretty interesting today when digging into the data on Ethereum vs Bitcoin. 

    Ethereum is strongly correlated with Bitcoin

    Firstly, the obvious. Ethereum is incredibly correlated with Bitcoin because, well, it is a cryptocurrency, and every crypto’s fate is tied to that of the orange coin. We know this by now. 

    The graph below shows how tight this relationship has been since Ethereum went live back in 2015. 

    But while these two best buddies follow each other around across the price charts, there are scenarios where they diverge a little bit. The famous ETH/BTC ratio is one which Ether fans in particular keep a keen eye on. 

    It peaked in June 2017 at close to 0.15 before freefalling down to 0.025 before the end of the year. Today, it trades at around 0.07. 

    Ether is better at bull markets than Bitcoin

    You may have noticed that the previous ETH/BTC chart resembled the shape of the crypto market overall, through its many ups and downs. 

    I plotted the price of Bitcoin against this ETH/BTC ratio. Indeed, the ratio rises as Bitcoin rises, and falls and Bitcoin falls. Using the Bitcoin price as a proxy for the whole industry, this suggests that the ETH/BTC ratio rises in bull markets and falls in bear markets. 

    This makes sense. Bitcoin is often referred to as the boomer coin. I quite like it that way, despite it being meant as an insult, by the way. But it’s an understandable moniker because Bitcoin does move like a pensioner during bull markets when compared to altcoins. 

    Ether may be the largest of the altcoins, but it still outperforms Bitcoin when the bulls are out to play. 

    On the flip side, Bitcoin outperforms when the party ends. And by outperform, I mean that it tends to drop 60% as opposed to 70%. But hey, that’s for another day.

    Pattern has flipped in 2023

    But the price charts are showing something different. One month into the new year, Bitcoin has surged while the ETH/BTC ratio has fallen – precisely the opposite of what has happened historically. 

    I charted the ratio back to the start of November, when Sam Bankman-Fried’s fun and games were revealed to the world and crypto fell, with Bitcoin cratering down to $16,000. 

    The chart shows that the pattern remained as you would expect, i.e. the ratio fell as crypto and Bitcoin pulled back. But as we turned the page into 2023, the crypto market flipped and Bitcoin soared. Only problem is, ETH didn’t follow, but rather the ratio has fallen, from 0.077 on January 11th to 0.068 currently, despite Bitcoin spiking from $17,400 to close to $23,000 over the same period. 

    Why? Honestly, I’m not sure. It’s unusual. 

    Bitcoin is up 36% on the year whereas Ether is only up 29%. Yet looking at the returns of other altcoins, perhaps it is nothing to do with Ether. Many are being outperformed by Bitcoin, while even the outperformers are not doing so by as much as has been seen previously (note I have removed Solana for scale purposes, which is up 125% thus far this year, following being decimated by links to Sam Bankman-Fried and multiple projects fleeing the blockchain at the end of last year). 

    In truth, this has just been a remarkable rise for Bitcoin from the depths of bear market pain. The rest of the market is not quite ready to forget the armageddon that was 2022, with many altcoins paring down over 90%. 

    Ethereum wasn’t quite as bad, but still fell from an all-time high of nearly $5,000. The free money and stimulus packages of the pandemic are over. It is a different climate now, and it is proving more challenging to kick up hype for altcoins. 

    The web3 narrative has faltered. NFTs have been crushed. There is no doubt that the narrative around ETH has been torn down. I have written about how institutional adoption will pare back in crypto, and how the sector’s reputation will take a long time to fix.

    That is true for Bitcoin. Perhaps it rings even more true for ETH and altcoins, which have even more to do to regain investors’ trust. 

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  • Bitcoin price outlook after BTC break above $23k

    Bitcoin price outlook after BTC break above $23k

    • Bitcoin’s rally from December lows after the FTX collapse surprised many investors, Glassnode says in its weekly report.
    • Bitcoin could see further upside but a fresh buy signal is likely at prices around $28.3k.
    • Selling pressure above $23.3k is more likely given short-term holders and miner push for exit liquidity.

    Bitcoin price remains poised near $23,000 after a breakout pushed the leading cryptocurrency’s value above the psychological $20k level.

    As highlighted ove the weekend, Bitcoin’s surge to prices above $23,000 did surprise many people, and while optimism is high among bulls, a potential liquidity exit from profit booking is likely. Particularly, this could be the outlook given how brutal the 2022 bear market was for short term holders and miners.

    On-chain data platform Glassnode has highlighted this possibility.

    Glassnode’s outlook after latest BTC price action

    According to on-chain data firm Glassnode, Bitcoin looks “almost out of the woods,” but the price action to levels in the $21k to $23k region also reclaimed several on-chain pricing models.

    A look at the Investor Price (currently at $17.4k) and Delta Price ($11.4k), signifies a similar price action at the bear market bottom of 2018-2019. Investor Price is the average price at which investors acquired all the spent and miner distributed coins, while Delta Price is derived from Realized Cap minus Bitcoin’s all-time Average Cap to get a technical pricing model.

    At the base of this outlook is the price discovery phase, which during that 2018 bear market bottom lasted 78 days. The current market is at a similar level, with BTC above the Realized Price of $19.7k.

    “This suggests an equivalency in durational pain across the darkest phase of both bear markets,” Glassnode wrote in its weekly market report.

    Still on the Investor Price/Delta Price metrics, the on-chain platform points to a measure called compression, which takes into account the spot price to determine the intensity of the market’s undervaluation.  The metric also correlates with the scale of change in an asset’s Realized Cap or capital inflow volume, with a threshold zone of 0.15-0.2.

    Given the current BTC price and compression value, Glassnode estimates a bullish confirmation signal could be triggered if Bitcoin bulls reclaim $28.3k.

    More optimism for bulls

    Also helping the bull case is the Supply in Profit measure, which spiked 12% in the last two weeks to rise from 55% to 67%. The spike in percent of coins in profit is “the sharpest” of all prior bear markets, suggesting a lot more coins changed hands below the $23.3k level.

    Key to bulls’ case is also the fact that Bitcoin price at current levels is above all the three cost basis of long-term holder, short-term holder and BTC Realized Price. This is the first time spot price has pierced the three Realized Prices and sustained momentum above the levels would be positive.

    A bull trap case

    While Glassnode points to potential bull case scenarios, its report also highlights probable cases of fresh sell-off pressure.

    According to the on-chain data report, one of these is the “substantial spike in profitability,” which the platform says raises the possibility of selling pressure triggered by short-term holders. 

    Miners are also likely to be motivated by the price action and might look to liquidate some of their holdings, adding to a potential retreat for BTC price.

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  • Bankrupt BlockFi plans to sell $160M Bitcoin mining hardware loans

    Bankrupt BlockFi plans to sell $160M Bitcoin mining hardware loans

    • BlockFi filed for Chapter 11 bankruptcy in November 2022 citing exposure to the just collapsed FTX.
    • The plan to sell off the loans backed by Bitcoin mining machines is part of the bankruptcy proceedings.
    • Bidders have until before the end of January to submit offers.

    About two months after BlockFi filed for Chapter 11 bankruptcy, the crypto lender now plans to sell off $160 million in loans backed by Bitcoin mining hardware as part of the bankruptcy legal proceedings. In total, the loans are backed by about 68,000 Bitcoin mining machines

    Although BlockFi cited FTX’s exposure as the main reason for its bankruptcy, the crypto lender had announced cutting its workforce by 20% in June 2022 citing the crypto prices meltdown. The layoff announcement came days after reports emerged that the lender was in talks to raise funding at a $5 billion valuation.

    Bidders have until January 24 to send offers

    According to reports from Bloomberg, BlockFi started the process of selling off the Bitcoin mining hardware-backed loans last year. It is believed some of the said loans have already defaulted since then and are candidates for under-collateralization following the drastic decline in the prices of Bitcoin mining hardware.

    In an interview with one popular media outlet, crypto lawyer Harrison Dell who is a director at Australian law firm Cadena Legal said that the loans are not worth their paper value to BlockFi if the Bitcoin mining equipment used as collateral is worth less than the value of the loans.

    According to Harrison Dell, the people bidding for the loans are most likely debt collection businesses saying that selling the debts is all that BlockFi can do at the moment.

    It is believed that BlockFi’s attempt to sell off its loans is likely a part of the lender’s efforts to pay off its creditors who are about 100,000 in total.

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