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  • CoinDCX data reveals India’s rising appetite for diversified digital assets

    CoinDCX data reveals India’s rising appetite for diversified digital assets

    CoinDCX data reveals India’s rising appetite for diversified digital assets

    • CoinDCX users now hold an average of five tokens, up from two to three previously.
    • Women investors doubled year on year with broader diversification trends.
    • Millennials remain the dominant user base as the average age rises to 32.

    Indian crypto investors are showing a stronger preference for diversified digital asset portfolios, marking an early shift toward more deliberate and long-term allocation behaviour.

    CoinDCX’s annual report, released on Thursday, suggests that the country’s retail investor base is gradually moving away from the idea that crypto is synonymous with Bitcoin, signalling broader maturity in market participation in 2025.

    This trend reflects a market becoming more confident, curious, and willing to explore varied opportunities across the expanding digital ecosystem.

    The exchange found that the average user now holds around five tokens, compared with two to three in 2022.

    This steady expansion of holdings indicates a growing awareness of portfolio construction and a willingness to explore different parts of the crypto market beyond the most established assets.

    Layer-1 tokens lead activity

    CoinDCX reported that layer-1 assets accounted for 43.3% of portfolio volumes.

    Bitcoin, priced at $93,133, held a 26.5% share of allocations. Memecoins made up 11.8% of user portfolios, showing that speculative interest remains a part of broader diversification trends.

    According to the exchange, Indian traders have become increasingly comfortable navigating different digital asset categories as adoption widens across the country.

    The report noted that crypto is emerging as a natural extension of the financial products already familiar to many users.

    Millennials dominate participation

    The platform’s user base is ageing upward, with the average trader now 32 years old. Millennials continue to make up the majority of users, outpacing Gen Z in adoption, though younger traders remain active.

    Gen Z users, aged 18 to 24, tend to favour emerging narratives such as layer-2 ecosystems, memecoins, and non-fungible tokens. Their behaviour reflects a greater appetite for thematic or speculative sectors.

    CoinDCX also saw its number of women investors double year on year. These users are diversifying beyond Bitcoin and Ether, priced at $3,183, into tokens such as Solana at $143.04 and Sui at $1.67.

    Founded in 2018 and backed by Coinbase, CoinDCX is one of India’s largest crypto exchanges with more than 20 million registered users. It remains a key gateway for retail access to digital assets.

    India shows wide but shallow adoption

    CoinDCX noted that India continues to lead in early indicators of digital asset awareness, including mobile-first trading behaviour and high engagement across educational content on the platform.

    These signals reflect strong nationwide interest in crypto as a financial category.

    However, the exchange found that deeper, research-driven participation remains limited. Many users enter the market through popular assets or trending narratives rather than sustained ecosystem involvement.

    As a result, the platform characterised India’s adoption as “wide” but not yet “deep”.

    CoinDCX said the country is still in the early stages of its digital asset journey, leaving significant room for education, innovation, and long-term growth as user sophistication develops.

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  • Starknet (STRK) price soars 30%, but why is the altcoin rising?

    Starknet (STRK) price soars 30%, but why is the altcoin rising?

    Starknet (STRK) price soars 30%

    • Starknet (STRK) price technical breakout signals bullish momentum with new resistance near $0.214.
    • Bitcoin staking and BTCFi incentives drive STRK adoption and network growth.
    • S-Two prover deployment has also boosted throughput, privacy, and decentralisation on Starknet.

    Starknet (STRK) price has surged dramatically in recent days, catching the attention of traders and crypto enthusiasts alike.

    The altcoin has gained more than 30% in just 24 hours, fueled by a combination of technological upgrades, strategic integration with Bitcoin, and renewed market optimism.

    This sudden upswing has sparked questions about what is driving STRK’s momentum and whether the altcoin can sustain its gains in the near term.

    Bitcoin staking boosts STRK utility

    One of the primary drivers behind the rally is Starknet’s BTCFi initiative, which allows Bitcoin (BTC) holders to stake their BTC and earn STRK rewards while maintaining custody.

    The program has already attracted significant capital, with over $200 million staked on the network, including 880 million STRK and 835 BTC, according to the latest reports.

    By tapping into Bitcoin’s massive $2.1 trillion market capitalisation, Starknet positions STRK as a key rewards token and a practical asset for paying network fees.

    The BTCFi ecosystem expansion not only strengthens Starknet’s liquidity but also enhances its cross-chain utility.

    Investors are closely monitoring total value locked (TVL) in Bitcoin staking, which currently sits at around $1.5 billion, to gauge continued adoption and the altcoin’s potential growth.

    The influx of BTC and STRK into the network has bolstered confidence in the protocol’s future, creating a clear catalyst for the recent price surge.

    S-Two Prover accelerates adoption and decentralisation

    Another major factor propelling STRK is the deployment of StarkWare’s next-generation S-two Prover.

    Released on the mainnet a few days ago, this open-source zero-knowledge proof system is designed to increase throughput, reduce verification costs, and strengthen decentralisation.

    By producing validity proofs for every block up to ten times faster than its predecessor, the S-two prover allows real-time verification of off-chain transactions and supports new types of applications, from private DeFi protocols to zk-secured games and verifiable AI.

    S-two is designed to operate efficiently even on consumer hardware, meaning that anyone can participate in the network without relying on centralised data centres.

    This advancement not only improves network security and censorship resistance but also significantly enhances user experience.

    The combination of speed, privacy, and accessibility makes Starknet a more compelling platform for developers and investors alike, contributing directly to bullish sentiment surrounding STRK.

    Market analysts also note that the recent surge is supported by optimism surrounding Starknet’s v0.14.0 upgrade.

    The update introduces distributed sequencers, 6-second blocks, and EIP-1559-style fee burns, all of which improve decentralisation and network efficiency.

    While early migration caused temporary outages, the upgrade underscores Starknet’s commitment to building a secure, scalable Layer 2 ecosystem that can interact with both Ethereum and Bitcoin.

    Technical breakout fuels the STRK price rally

    From a technical perspective, STRK has confirmed a major bullish breakout.

    The altcoin surpassed the 38.2% Fibonacci retracement level at $0.1343 and remains above the 30-day simple moving average of $0.1216.

    Starknet price chart
    Starknet price chart | Source: CoinMarketCap

    Momentum indicators such as the RSI and MACD show strong upward trends, signalling that the altcoin has invalidated much of its previous yearly downtrend.

    With resistance set near $0.214, traders should closely watch whether the current momentum can push STRK to new highs.

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  • Bitcoin Cash up 7% as bulls defy BTC dump, eye gains on rising volume

    Bitcoin Cash up 7% as bulls defy BTC dump, eye gains on rising volume

    Bitcoin Cash Price

    • Bitcoin Cash has seen a notable surge in the past 24 hours, gaining 8% to $554.
    • The altcoin sees gains as Bitcoin price dumps amid massive sell-off pressure.
    • With trading volume up 44% and rising open interest also surging, BCH could defy the benchmark asset’s dip further and eye highs last seen in December 2024.

    The Bitcoin Cash (BCH) price currently stands at approximately $551.

    While it’s off its intraday highs of $554, it remains above the $550 mark, up as one of the top gainers in the past 24 hours.

    According to CoinMarketCap, this comes as Bitcoin’s latest correction has many altcoins also showing weakness.

    Bitcoin Cash defies BTC dump with 7% gain

    BTC dropped to below $115k after Galaxy Digital, a prominent crypto investment firm, offloaded 30,000 BTC in under 24 hours.

    Liquidations spiked amid the Bitcoin dump, but Bitcoin Cash looked to buck the trend.

    Its intraday gains of over 8% see it rank among the top performers in the 100 largest cryptocurrencies by market cap.

    Bitcoin Cash price chart by CoinMarketCap

    Notably, gains keep BCH in an uptrend over the longer time frames. The altcoin’s price is on an upward trajectory since touching lows of $268 in April 2025.

    Also, the price gain amid a 44% increase in trading volume to over $870 million suggests potential buying pressure.

    Crypto analyst CW points to increased whale interest, particularly in China.

    Is BCH poised for a rally to $1,000?

    BCH price last traded at $1,000 in May 2021, at the time when bears pushed it lower from above $1,427.

    In the past year, an attempt by buyers to reclaim the level fizzled out at around $624 in December 2024.

    While the cryptocurrency has struggled for upside momentum, analysts are increasingly optimistic about Bitcoin Cash’s potential to rally toward $1,000.

    Other than the overall long-term bullish sentiment around crypto, the short-term picture highlights robust market metrics and technical outlook.

    BCH price chart by TradingView

    For instance, open interest in BCH derivatives has jumped 24% to $533 million, with volume 28% up to over $1.3 billion.

    A surge in speculative activity signals bullish confidence in the token’s price.

    The technical picture further bolsters this bullish outlook.

    The Relative Strength Index (RSI) currently reads 63.

    Meanwhile, the Moving Average Convergence Divergence (MACD), is also flashing a bullish crossover to hint at potential short-term upward pressure.

    If bulls manage a breakout to the supply wall at $540-$565, they could retest the $620-$650 area.

    Above this, resistance above $700 could allow bulls to target $1,000. Conversely, support lies around $480 and then $380.
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  • VIRTUAL token surges 183% in April amid rising institutional demand

    VIRTUAL token surges 183% in April amid rising institutional demand

    Investment

    • Institutional interest drives the VIRTUAL rally.
    • Chaikin Money Flow signals strong capital inflows.
    • The price pattern shows a bullish formation.

    While most digital assets struggled to maintain direction in April, VIRTUAL emerged as one of the few cryptocurrencies to post sharp gains.

    The token has rallied 183% since April 1, making it the top-performing asset in the crypto space during a month marked by subdued sentiment and low volatility.

    With its price up 22% in the last 24 hours alone, investor attention has turned to the technical indicators, suggesting further upside may be on the horizon.

    The rally comes amid a broader shift in smart capital allocation, as institutional buyers appear to be rotating into mid-cap altcoins with strong momentum and liquidity.

    Institutional interest drives the VIRTUAL rally

    VIRTUAL’s uptrend began on 22 April and has since shown consistent price appreciation.

    One of the most notable developments has been the surge in its Smart Money Index (SMI), which currently stands at 3.07.

    The SMI tracks institutional trading patterns by focusing on price movements during the opening and closing hours of each trading day.

    A rising SMI along with increasing price generally signals accumulation by professional or large investors.

    This correlation suggests that “smart money” is positioning itself for longer-term gains, adding weight to VIRTUAL’s recent momentum.

    On-chain data also shows that the number of whale addresses holding VIRTUAL has risen since mid-April, providing additional evidence of institutional accumulation.

    Chaikin Money Flow signals strong capital inflows

    Further confirming the bullish sentiment is VIRTUAL’s Chaikin Money Flow (CMF) indicator, which remains in positive territory at 0.25 and continues to trend upwards.

    The CMF measures the volume-weighted average of accumulation and distribution over a given period, helping traders assess the strength behind a price move.

    A positive and rising CMF reading reflects strong buying pressure and sustained capital inflows.

    Together with the elevated SMI, this trend reinforces the narrative that VIRTUAL’s current rally is backed by increasing liquidity and investor confidence.

    Analysts tracking short-term trends have also noted heightened activity on VIRTUAL’s decentralised exchange pairs, with total volume crossing $20 million over the past week.

    This points to both retail and institutional participation in the ongoing uptrend.

    Price pattern shows a bullish formation

    Technically, VIRTUAL has been trading within an ascending parallel channel since its breakout on 22 April.

    This formation, defined by consistently higher highs and higher lows within two upward-sloping trendlines, is generally considered a bullish signal.

    As long as the token remains within this pattern, the current trend is likely to continue.

    If momentum persists and demand remains high, VIRTUAL’s price could rise to test the upper resistance level near $2.26.

    That would represent a further 25% increase from current levels.

    However, if profit-taking intensifies and breaks the token’s support at $1.55 (£1.24), the bullish structure may fail.

    In that case, the price could drop towards the $0.96 region, where previous demand re-emerged.

    Short-term sentiment remains bullish

    Despite broader market weakness, sentiment around VIRTUAL remains positive in the short term due to favourable on-chain metrics and increased institutional interest.

    The token’s strong performance in April has sparked discussions around whether it can sustain momentum into May, particularly as altcoin volatility returns.

    Technical indicators currently favour a continuation of the uptrend, though any macroeconomic shock or sudden risk-off sentiment in the crypto sector could pose downside risks.

    Market participants are watching upcoming economic data releases closely, which may influence liquidity across risk assets, including VIRTUAL.

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  • Top crypto picks to buy at rising market before it’s too late

    Top crypto picks to buy at rising market before it’s too late

    • A new and promising crypto, ScapesMania, has witnessed impressive presale success.
    • Ethereum is poised for growth with potential regulatory advancements like an ETF while Solana is the 5th most-traded cryptocurrency, stable and growing.
    • Polygon is resilient and attracts investments, Dogecoin balances community projects amid market fluctuations, and Shiba Inu faces uncertainty due to whale transactions and a bearish outlook.

    The cryptocurrency market is currently experiencing a significant upswing, with Bitcoin (BTC) crossing the $42,000 mark, signaling a broader market recovery. This resurgence is not just limited to the flagship cryptocurrency but is also evident in the performance of other players.

    Today, we’ve put together our 6 top picks for investors looking to capitalize on the rising market before it’s too late: Ethereum (ETH), Solana (SOL), Polygon (MATIC), Dogecoin (DOGE), Shiba Inu (SHIB), and the emerging ScapesMania. These coins have the potential to yield significant returns and showcase substantial growth.

    Let’s take a closer look at each coin.

    Growth factors behind promising coins

    ScapesMania: features and vision

    ScapesMania is an innovative crypto project currently in the presale phase. Amidst the volatility experienced by larger cryptocurrencies, it offers a unique opportunity to diversify your portfolio. 

    Upon closer examination, ScapesMania reveals a range of appealing features. By embracing ScapesMania, crypto enthusiasts get a chance to engage with a unique ecosystem thriving within a multi-billion-dollar gaming industry. 

    Furthermore, ScapesMania has implemented mechanisms to keep holders actively involved and incentivized. By participating in DAO governance, backers have a say about ScapesMania’s future direction. Other notable perks for holders include up to $142 in bonuses for early adopters, token buyback and burn mechanisms, and staking rewards.

    As for safety, the project’s smart contract has undergone a thorough audit by leading security-ranking companies. ScapesMania is backed by an award-winning team that has secured a prestigious grant from a major player in the blockchain industry.

    Visit ScapesMania’s website for more information about its standout features.

    Ethereum: regulatory developments and market Impact

    Ethereum price chart

     

    Ethereum is currently experiencing a noteworthy development related to regulatory matters and market dynamics. The United States Securities and Exchange Commission (SEC) is actively engaged in discussions regarding a proposed rule change. 

    This change, if approved, would enable Fidelity Investments to offer shares of its spot Ethereum (ETH) exchange-traded fund (ETF). 

    Fidelity’s latest SEC filing outlines its ETF’s objective to monitor Ether’s performance using the Fidelity Ethereum Index. If approved, the ETF, trading as ETHF on the Cboe BZX Exchange, may mark a pivotal moment in Ethereum’s broader adoption.

    Solana: climbing the ranks in the crypto market

    Solana price chart

    Solana has recently achieved a significant milestone. As of now, it’s the 5th most-traded cryptocurrency in the world. This achievement indicates a rising trend in its adoption and a growing interest from traders and investors. 

    Furthermore, Solana’s blockchain has experienced positive developments. Among notable achievements are inclusion in Visa’s stablecoin trials, a rise in total value locked, and maintaining around nine months of continuous uptime. 

    These factors enhance Solana’s presence and credibility in the market. Ultimately, investors can expect an ongoing upward trend in SOL’s price performance.

    Polygon: navigating through market volatility

    Polygon price chart

    MATIC underwent a significant price correction recently, drawing considerable interest from prominent investors commonly known as “whales.” 

    Capitalizing on the dip in Polygon’s price, these large-scale investors seized the opportunity and injected a substantial $90 million into acquiring MATIC tokens. This influx of funds suggests a strategic move by major players in response to the recent price fluctuations in the Polygon market. 

    Major backers continue to play a pivotal role in shaping the asset’s value amidst dynamic market conditions in the Polygon ecosystem. So, keeping an eye on the movements of these whales remains crucial. 

    Dogecoin: aiming for the moon

    Dogecoin price chart

    The Dogecoin community has embarked on an ambitious mission to send a physical token to the moon, reflecting the coin’s playful and pioneering spirit. This endeavor coincides with a significant technical development in Dogecoin market behavior. 

    DOGE’s price recently broke out from a long-term descending resistance trend line, which had been in place for 900 days. 

    Furthermore, the number of total crypto wallets holding DOGE reaches 5 million. These dynamics indicate the growing adoption and increased user activity within the blossoming Dogecoin network.

    Shiba Inu: whale transactions and network developments

    Shiba inu price chart

    Shiba Inu recently underwent a substantial transaction involving the transfer of 300 billion SHIB tokens to an anonymous wallet. Notably, this transfer originated from the popular cryptocurrency exchange Binance. 

    The occurrence of this transaction has generated curiosity and speculation within the crypto community, driving investors’ interest in the token. However, it’s not the only growth factor behind Shiba Inu.

    Shiba Inu’s advancements, such as the launch of Shibarium, aim to enhance transaction efficiency and reduce costs. These developments can further increase SHIB’s appeal for decentralized finance use cases.

    Current state and prospects

    ScapesMania: ambitious future vision

    The ScapesMania presale unfolds in several rounds, with the current one presenting a substantial 70% discount on token purchases. This discounted entry point provides an attractive incentive for early adopters, offering potential ROIs of 400-500% as the post-listing price hits the $0.1 mark.

    Looking ahead, ScapesMania’s ambitious vision includes listings on major exchanges and continuous improvements. The team is on a mission to develop a unique niche concept not yet explored in crypto circles. This forward-thinking approach contributes to the outstanding presale figures, positioning ScapesMania as one of the potential long-term assets for crypto enthusiasts.

    With its visionary roadmap and current presale offerings, ScapesMania could be a worthy bet for those seeking a foothold in the crypto space. To dig deeper into ScapesMania’s proposition, visit its official website, Twitter account, and Telegram channel.

    Ethereum: potential impact of US ETF

    The prospect of an Ethereum ETF in the U.S. market could lead to increased institutional interest and investment in Ethereum. The anticipation of such developments could create a bullish sentiment among investors, potentially driving up the price of ETH.

    Crypto enthusiasts eagerly await SEC approval for ETFs, given the SEC’s historical reluctance, often citing market manipulation concerns. Optimists believe that ETFs holding major cryptocurrencies could significantly transform the market by facilitating mainstream investors’ entry into digital assets.

    The future of Ethereum looks promising with the potential approval of an ETF. However, the SEC’s history of caution in approving spot cryptocurrency ETFs suggests that the road ahead may not be smooth. 

    Solana: stable growth amid volatility

    The price situation of SOL is currently stable, showing signs of steady growth. The stability in its price, despite the volatile nature of the cryptocurrency market, is a positive sign for investors looking for a relatively less volatile asset.

    Looking ahead, the future of Solana appears bright, with its rising adoption and stable price situation. The increasing interest from traders and its position as one of the most-traded cryptocurrencies could lead to further growth in its value. 

    Solana’s price surged by approximately 550% this year, emphasizing its strong network. Given Solana’s remarkable performance and robust infrastructure, it holds the potential to extend its ascent.

    Polygon: resilience and whales’ interest

    The price of MATIC has shown resilience in the face of volatility. After a retracement from its peak, MATIC has managed to rebound from its recent lows, retaining a substantial portion of its monthly gains with an overall 20% increase within the evaluated period. 

    At the same time, Polygon is seeing a rise in the MATIC exchange reserve. This signal indicates increased net deposits possibly driven by profit-taking motives.

    The future of Polygon appears to be on a recovery path. The network’s heightened activity and continued interest from influential whales contribute to the optimism surrounding Polygon MATIC

    Dogecoin: fluctuations and bullish signals

    The price of Dogecoin DOGE has seen fluctuations since reaching a high of $0.087 on November 17. The decrease caused a deviation above the $0.082 horizontal resistance area. 

    The future of Dogecoin seems to be a blend of optimism and caution. The weekly timeframe suggests a bullish trend, while the daily timeframe indicates the potential for a retracement before a possible increase. 

    Considering the high levels of adoption and usage, the odds are certainly looking in favor of the bulls. Still, if DOGE manages to close above the $0.082 resistance area, it could signal a bullish takeover, potentially leading to a significant price increase. 

    Shiba Inu: a rebound potential

    The technical analysis of the SHIB price chart shows a descending triangle formation, with a recent break below the lower trendline, suggesting a bearish outlook. However, the price is hovering above a crucial support level, with the 50-day moving average potentially acting as a springboard for a rebound.

    The future of Shiba Inu is shrouded in uncertainty. If the wallet’s accumulation strategy positively influences market sentiment, we could see an upward price correction. However, the bearish indicators and unpredictability of large-scale transactions make it challenging to forecast SHIB’s prospects. 

    Investors are keenly anticipating Shiba Inu to surpass the $0.01 mark, aiming for the significant milestone of $1. Despite this optimistic outlook, reaching the price of $1 doesn’t look realistic. The Shibarium layer-2 network’s lack of burning trillions of SHIB adds complexity to the token’s growth.

    Bottom line

    In this dynamic phase of the cryptocurrency market, these six coins represent a blend of established reliability and exciting potential. Ethereum and Solana continue to demonstrate stability and growth, Polygon and Dogecoin offer a mix of stability and innovation, while Shiba Inu presents an opportunity for those willing to navigate its uncertain waters. 

    Meanwhile, ScapesMania emerges as a dark horse, offering potentially high returns and an opportunity to save big for early adopters. This affordability opens doors for investors with varying budget sizes to explore ScapesMania without significant financial commitments.

    Discover more details about ScapesMania on the official site.

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  • Kaspa (KAS) price rising after CoinPal integration

    Kaspa (KAS) price rising after CoinPal integration

    • Kaspa (KAS) price has surged 31% in the last 7 days and 4% in the last 24 hours.
    • Kaspa was on June 22 integrated on CoinPal.
    • CoinPal is a leading cryptocurrency payment service provider.

    While yesterday’s Kaspa integration with CoinPal is not the sole reason why Kaspa (KAS) price is rising, the integration has added impetus to the KAS bullish momentum.

    The integration comes at a time when the crypto market is seeing a rebound that has pushed Bitcoin (BTC) price above $30K for the first time in months. It is also ten days since Michael Sutton, Georges Künzli, and Shai Wyborski presented a proposal referred to as KIP-4 that aims at refining the Kaspa protocol by translating its complex mechanisms into a language that everyday enthusiasts can easily grasp.

    Kaspa integration with CoinPal

    Kaspa is one of the fastest, open-source, decentralized, and fully scalable Layer-1 blockchains in the world. It is the world’s first digital ledger enabling parallel blocks.

    Kaspa and Bitcoin share the fundamental principles of decentralization and peer-to-peer technology. Kaspa has, however, introduced upgrades like increased scalability, lower transaction fees, and faster transaction speeds. Therefore, by integrating Kaspa, CoinPal and its users will have access to more than 50 supported cryptocurrencies thus expanding their options.

    By incorporating Kaspa into its platform, CoinPal.io has made significant progress toward broadening its scope. By consistently expanding the number of cryptocurrencies it supports and improving its services, CoinPal stays ahead of the curve in the rapidly changing world of digital currencies.

    By incorporating Kaspa, CoinPal is advancing e-commerce and establishing itself as a major force in the adoption of cryptocurrencies.

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  • Why are Bitcoin transaction fees rising, and what are BRC-20 tokens?

    Why are Bitcoin transaction fees rising, and what are BRC-20 tokens?

    Key Takeaways

    • BRC-20 tokens were launched on Bitcoin in March 2023
    • Transaction fees spiked to all-time highs in May 2023 as network activity spiked
    • Bringing memes and NFTs to Bitcoin has caused controversy
    • Some argue the rising fees are vital to the security of the network, while others scoff at the activity for getting away from Bitcoin’s “vision”

    We live in an inflationary world. Food prices, rent, energy – everything feels more expensive. That is not limited to the fiat world, however. Bitcoin users have noticed a hike in fees recently. So why is this happening, and what does it mean for Bitcoin? And what does this weird concept of NFTs on Bitcoin have to do with anything?

    Bitcoin fees rocket upwards in May

    Firstly, let us look at a chart presenting Bitcoin fees over the last three years to show the spike in fees. Clearly, the vertical jump in the first week of May is glaring. 

    While Bitcoin fees may rise in future regardless (and we will get to that in a moment), the outlier that is this wild spike in May 2023 is down to something I never thought I would say with regards to Bitcoin: memes.

    Specifically, the BRC-20 protocol, which is a token standard inspired by ERC-20 tokens on Ethereum. To explain this, we first need to look at Bitcoin Ordinals, because that is what has made this all possible. And yes, it is all on the Bitcoin blockchain. 

    What are Bitcoin Ordinals?

    Bitcoin was always viewed as the “pure” blockchain. There was no room for non-fungibility, meaning each Bitcoin is the same as another Bitcoin. No NFT nonsense here, thank you very much. 

    This changed in January 2023 when the Ordinal protocol was invented. In simple terms, the Ordinals protocol is a system for marking each satoshi, the smallest denomination of a Bitcoin (every Bitcoin is divided into 10 million satoshis). These marked satoshis can then be tracked and differentiated from other satoshis, meaning they are technically “non-fungible”. And so, against all odds, we (sort of) have Bitcoin NFTs. 

    The marks on satoshis have become known as “inscriptions”. These inscriptions were made possible by the Taproot upgrade to the Bitcoin network in November 2021. The protocol is known as Ordinals, named due to the fact the transfer scheme for satoshis relies on the order of transactions. 

    While this all sounds a little complex, in comparison to NFTs on other blockchains, it is very primitive and basic. There are no smart contracts here. Sidechains are not necessary. Everything is inscribed directly on the Bitcoin blockchain. 

    What are BRC-20 tokens?

    Two months after Ordinals arrived in the world, an experimental token standard, named BRC-20 in a nod to ERC-20 tokens on Ethereum, were launched in March 2023. This token standard creates fungible tokens within the Ordinal protocol. You may suspect where this is going. The ability to trade fungible tokens within this protocol of Bitcoin? Yes, memes. 

    In the below chart, I have presented the top 10 BRC-20 tokens by market cap. As one will be able to deduce pretty swiftly when looking at the names, a lot of these are memes. 

    (sidenote – eagle-eyed readers may also be able to deduce from the supply of some of these tokens that they are memes. Personally, I enjoy the nod to Satoshi Nakamoto with the 21 million supply of so many on the board). 

    What has all this got to do with fees?

    So, back to fees. The rise of Bitcoin Ordinals has thrown up an interesting dilemma. These inscribed satoshis are now competing for block space with conventional Bitcoin transactions. On the Bitcoin network, more activity leads to more fees, and this is why we have been seeing a spike in fees. As the BRC-20 tokens have taken off, we have seen Bitcoin’s network clog up and fees jump. 

    This has caused a debate. Some argue against these higher fees, lamenting the waste of time that NFTs and memes are, getting in the way of what Bitcoin is “meant” to be. On the other side, fees are vital for the security of the Bitcoin network. Additionally, once the final supply of 21 million Bitcoins is hit in 2140, miners will need to survive solely on fees. Indeed, as block rewards step down with each halving, mining fees become an ever larger portion of miners’ income, and hence these fees are a crucial incentive for miners and a driver of the hash power for Bitcoin. 

    Personally, my take on this is somewhat between the two extremes. I have every confidence that these memes and NFTs and whatever else trading on the Bitcoin network are inherently valueless. Then again, I don’t care much for NFTs in general. However, I don’t see the rising fees as an issue. 

    The key here is that the hash rate is still rising. This contrasts to April 2021, which was another time period when Bitcoin fees spiked violently, the average transaction on the network costing a staggering $70. This was due to a crash in the hash rate, which is very much a concern for Bitcoin’s security and stability as a network. 

    This is different. Rising fees due to increased activity is fine. That is true regardless of the transaction: regular, meme, NFT or other. It really doesn’t matter. Besides, the scalability issue with Bitcoin is well known, and fee spikes encourage people to look at solutions such as sidechains, like the popular Lightning network which bundles transactions together off-chain. But there are other Layer-2s besides Lightning, such as Liquid and Rootstock, to name a couple.

    The prediction that the Bitcoin blockchain will become a base settlement layer has been around for some time. The existence of what is likely a fad, i.e. these tokens and Ordinals, is relatively harmless and shouldn’t change much in the overall scheme of things. The fee and scalability issue will always be here, regardless of what is driving it. And this is exactly why we have the Lightning network, and why people are continuing to innovate to come up with Layer-2 or other solutions. 

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  • Bitcoin volatility rising as $4.2 billion options set to expire Friday

    Bitcoin volatility rising as $4.2 billion options set to expire Friday

    Key Takeaways

    • Bitcoin volatility is the highest point since July 2022
    • Liquidity is extremely thin which is pushing volatility higher and accentuating price moves
    • $4.2 billion of options expire Friday, with bull set to profit following the recent surge up to $28,000

    Yesterday, I wrote a piece looking at how the correlation between Bitcoin and the stock market, notably tech stocks, has come back up. The relationship had loosened amid the banking turmoil that struck financial markets, triggered by the collapse of Silicon Valley Bank.

    As well as rising correlation, the market is also swinging wildly – the volatility is as high as it has been since July 2022, around the time Celsius sent evaporated into thin air and sent the market into mayhem.

    Why is volatility rising?

    The volatility spike is not surprising in light of the glut of liquidity currently in the markets. We crafted up a piece on this earlier this week, assessing how 45% of stablecoins had flowed out of exchanges in the last four months, with the balance now at the lowest point since October 2021. 

    It gives context to the recent Bitcoin price rise. With less liquidity in the markets, moves are naturally more violent, and Bitcoin has surged up to $28,000, now up 68% on the year. 

    While the move to the upside has been exacerbated by this thin liquidity, the opposite also holds true: the downside risk is elevated when markets are so thin. 

    It paints a picture of high risk for an asset that already oscillates wildly at the best of times. 

    Derivatives add to volatility

    Another factor? Derivatives open interest is absolutely soaring, with the below chart from Coinglass showing that options open interest is at its highest point since November 2021. 

    As I write this on March 31st, a mammoth $4.2 billion of Bitcoin options are set to expire. The below chart also shows the strike prices of the options – with a call/put ratio of 2.09 and Bitcoin currently trading close to $28,000, it will be a profitable day for many traders. 

    Digging into the numbers, there are 97,300 call options expiring at a strike price of $28,000 or less, compared to 24,500 put options. The dollar split is over $2 billion in favour of calls. 

    Looking at strike prices of the next level up, it is pretty much all call options. Between $28,000 and $32,000 there are 48,000 call options against 400 put options with a $1.4 billion split in favour of calls. 

    After a year of bears dominating, there will finally be some bulls primed to profit. 

    Indeed, looking at the Bitcoin spot holdings, it is showing more positive news all across the market. In December, the majority of Bitcoins were in loss-making positions, when comparing the market price to the price at which they last moved. 

    Today, however, 74% of the supply is in profit when using the same metric. 

     

    With interest rate policy expectations softening, Bitcoin has finally been allowed room to run. However, with thin liquidity and high volatility comes risk, although when it comes to Bitcoin, risk is hardly a foreign concept.

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  • Why are crypto prices rising? 2023 off to hot start

    Why are crypto prices rising? 2023 off to hot start

    Key Takeaways

    • Crypto markets have jumped to the start the year off positive macro news
    • Next inflation reading is out on Thursday, which will cause further volatility
    • Fight against inflation has long way to go, with investors not out of woods yet
    • Solana has risen 65% since New Year’s Day, but fell drastically prior and problems remain

    After what was, to put it mildly, a rather disappointing year in cryptocurrency in 2022, the new year has jumped out to a positive start.

    Bitcoin, Ethereum and all their other friends got ravaged last year, but nine days into 2023 there is green on the board. Let’s look at why this is, and whether we will see more of the same, or if price action will reverse back to the 2022 pain.

    Macro provides impetus for crypto run

    The single biggest reason for the cryptocurrency jump this year is the same reason that pulled the entire space down last year: macro.

    The stock market has had a positive start to the new year. This comes off the back of inflation readings around the globe coming in lower than expected. While there is still a hell of a long way to go in the battle against this rampant cost of living crisis, the latest data has given investors hope that central banks may pivot off their policy of high interest rates sooner than previously anticipated.

    After a decade of low interest rates, the world transitioned to a new interest rate paradigm in 2022, as rates were hiked aggressively in response to the inflation crisis. This was aimed at reining in demand and ultimately spiralling prices. As a result, all risk assets peeled back, and there is nothing riskier than crypto. So, down the market went.

    Solana decouples from market

    Of course, while macro is clearly the big driver here, there still remains idiosyncratic risk and happenings in the crypto space. Look no further than last year, when three events (Luna, Celsius and FTX) caused large dropdowns and deviations from the stock market, which otherwise displayed extremely high correlation with Bitcoin.

    To start the year, we have seen Solana streak out ahead of the crowd, printing a remarkable 65% return thus far, having opened the year at $10 and now trading at $16.50.

    I wrote a piece last week diving deep on Solana, but suffice it to say the coin has big problems. Between repeated outages, has seen several big projects flee the blockchain and has also suffered as a result of its close ties with the disgraced Sam Bankman-Fired. The below chart shows that while this rebound seems large at 65%, it is still a drop in the ocean compared to the freefall it has experienced.  

    This rise over the last week may be at least partially attributed to Bonk, the latest meme coin phenomenon which I also analysed last week. We know by now not to read too much into doggy tokens, but nonetheless, the rise has at least eased some of the pain for Solana investors.

    What Bitcoin continue to rise?

    As for the future, that is anyone’s guess. The next big day is Thursday, when the latest CPI figures are revealed. If inflation in the US comes in softer than expected, you can expect markets to rally upwards on renewed hope.

    It really comes down to the same thing it has for the last year: the crypto markets will only meaningfully rebound once the Federal Reserve pivots away from its currently-hawkish interest rate policy.

    In turn, the Fed maintains that rates will continue to rise as long as inflation is elevated. With the employment market still tight and core inflation remaining stubborn (the headline rate has partially fallen due to energy prices, whereas core inflation is typically the number that lawmakers focus on), there is still a long way to go.

    Ultimately, 2023 in the crypto markets will likely be decided based on what happens with this tussle between the Fed and inflation. Until that much-fantasised-about pivot actually occurs though, it could remain a tough time for digital markets.

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  • The Dogecoin Curiosity is Rising in Turkey

    The Dogecoin Curiosity is Rising in Turkey

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