How will BTC transaction accumulation affect asset price

Our experts named the reasons for the large “queue” of transactions in BTC network. And described the ways to solve this problem, as well as its impact on the price of the leading digital asset.

At the beginning of May, the daily number of transactions in Bitcoin network renewed its historical maximum at 685 thousand. This happened amid a surge of activity associated with the issue of bitcoin-NFT or Ordinals.

The ability to issue tokens on the Bitcoin network appeared in late January. And since then more than 4.69 million of them were created. More than 789 BTC ($21.9 million) were spent as commissions.

As of May 8, there are still more than 455,000 transactions waiting to be confirmed in the first cryptocurrency blockchain. Which is a record high. Experts told what the formation of such a queue could lead to.

Reasons and solutions

Queuing is a fairly typical situation for PoW blockchains. And many factors can affect it, but the main reason is always associated with a sharp increase in interest in intra-network transfers.

Our experts say that the problem develops further very quickly. As the queue generates an even bigger queue, similar to the traffic jams that form from traffic jams when people try to avoid them. In blockchains, users start to raise fees. And all new transactions get stuck, while old ones may stay in the mempool (transaction queue, mempool) for weeks until the load is reduced.

There is no direct solution to this situation, says our expert. In general, the “scalability problem” is the main reason to criticize the consensus mechanism Proof-of-Work (PoW), on which Bitcoin works. But our expert noted that there are local ways around this problem. For example, such as “replace-by-fee” or “child-pays-for-parent” mechanisms.

“Replace-by-fee” allows you to directly change the amount of commission in a transaction already sent to the waiting list. But very few wallets support this feature. And to enable it, it should have been provided for in advance: the transaction should have been sent with the parameter enabled. Which allows you to replace the commission already after the transaction has been sent.

The “child-pays-for-parent” function implies sending a new transaction from a wallet. To which the change from the previous transaction with the knowingly overrated commission must come. This is such that it would be profitable for miners to process two transactions at once.

The problem of scalability is partially solved by the use of L2 solutions. For example, there is a Lightning Network superstructure for Bitcoin, which does not load the main blockchain. The widespread implementation of this technology will help prevent queues in the future.

Impact on Bitcoin price

The current significant queue in the BTC network is unlikely to affect the value of the asset in the moment. But it does create a number of questions for what is happening around the Bitcoin blockchain.

If before the BTC network seemed to market participants something fundamental, stable, which is very difficult to change. And, as a consequence, difficult to deteriorate in its parameters. After the emergence of projects like Ordinals, Bitcoin no longer seems to be a cryptocurrency ” constant.

The fact that thousands of enthusiasts in the Bitcoin network can now create NFT using the experimental script BRC-20. This expands the capabilities of the project, but creates no additional value for BTC. Our expert noted that the Bitcoin blockchain has never been known for scaling as it is. And in times of stress and strong movements of the cryptocurrency market, transactions in the network, compared to other blockchains, were very slow at all.

Now, against the backdrop of a growing number of transactions. And at the moment the number of transactions “in the queue” exceeded 400 thousand, the network’s fees have also increased, which adds to the negativity.

Thus, over time, the perception of Bitcoin as the first asset of the market may shift towards other projects. Which will offer reliable, fast and profitable transactions. Thus, the events of today may lead to a decrease in interest and capitalization of BTC in the long run.

However, there is no clear competitor at the moment. Therefore, market participants will continue to use Bitcoin. Current price movements are unlikely to be affected by these processes. But in the long term, such an “evolution” of the Bitcoin network raises questions.

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What will happen to Bitcoin this week

Our experts have analyzed the situation on crypto market. And told how it can change for Bitcoin in the short term

Last week started not the best for Bitcoin. When against the background of weak Chinese statistics and the fall of the S&P500 index, the pair BTC/USDt fell to $27,666. It seemed that the situation would only worsen, but since May 2, the phase of recovery began thanks to the fall of the dollar index. And support from the U.S. Treasury Secretary Janet Yellen. Bitcoin has risen to $28,879.

However, there are still dangers to the U.S. economy. If Congress does not approve an increase in the national debt ceiling, the government will not be able to borrow additional funds. And it could find itself in a very difficult position. Since 1980, the U.S. government has shut down several times due to the inability to raise the national debt ceiling. Including closures in 1990, 1995-1996, 2013 and 2018-2019. Democrats and Republicans aren’t particularly worried about this.

After the publication of data on the labor market in the United States on May 4, the pair BTC/USDt rose to $29,677. However, investors remain generally quiet as buying activity in the cryptocurrency remained low.

The scenario of continuation of sideways movement on cyclic analysis is still confirmed. The beginning of a new rally on it falls on June 1.

According to BitRiver estimates, buyers have to fight for the level of $31,000. They need to pass it to make the price pattern on the daily timeframe “bullish”. Otherwise, the scales will start tipping to the sellers’ side.

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One of the largest Bitcoin mining centers will be built in the Himalayas

Mining company Bitdeer expects to build a 100 MW power plant in Bhutan for carbon-free cryptocurrency mining. Crypto-Upvotes expert review

The investment arm of the Kingdom of Bhutan and mining company Bitdeer Technologies plan to find investors for a $500 million fund.

Fundraising will begin as early as the end of May. The purpose of the fund is to launch a carbon-free Bitcoin mining center. Which uses hydroelectric power, the two companies said in a joint filing with the U.S. Securities and Exchange Commission (SEC). According to the document, Bitdeer expects to build a 100-megawatt power plant in Bhutan. And its construction will begin in the second quarter and be completed in July-September.

Mining will be the least risky way for Bhutan to take advantage of cryptocurrency opportunities. And for now, the country will only focus on Bitcoin, said Ujjwal Deep Dahal, head of the investment arm of local firm Druk Holding & Investments, in a commentary for Bloomberg. Druk began mining cryptocurrencies as part of an experiment when bitcoin was still worth about $5,000, he said.

The kingdom of Bhutan

The Kingdom of Bhutan is located between China and India. And it has a population of about 800,000 people. The local economy relies heavily on revenues from hydropower. Druk manages public investments in traditional areas. These include stocks, bonds, technology, energy and real estate. It also mines cryptocurrencies and invests in what the company calls a “future-oriented” strategy.

The Bitdeer company is registered in Singapore and is owned by Chinese businessman Jihan Wu. And acts as one of the leading players in the cryptocurrency mining market in terms of aggregate capacity. Wu previously served on the board of directors of Bitmain, a leading manufacturer of mining equipment. And owned the BTC.com mining pool until February 2021.

Bitdeer went public on the NASDAQ exchange through a SPAC deal in April, and its shares trade under the ticker BTDR. The company owns one of the largest cryptocurrency mining centers in Texas. In the United States, rising electricity prices have led to the bankruptcy of several major cryptocurrency players. And on May 2, the presidential administration again raised the issue of imposing a 30% tax on miners.

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What will happen to Bitcoin in this week

Crypto Upvotes experts analyzed the situation in the Crypto market. And told how it can change in the short term, as well as what will happen to Bitcoin price

Last week was a hot one. Bitcoin rose in price by 7.63%, but this is no reason to panic. The growth of quotations began in the evening of April 9. Since the new week, purchases of the first cryptocurrency intensified amid the growth of U.S. stock indices. After the end of the holiday in the U.S. and strong Friday employment data. Investors raised the probability of another Federal Reserve rate hike in May by 25 basis points.

Since this pace of rate hikes has been factored in by the markets. Then buyers went on the offensive after a prolonged sideways trend. At first they took the level of $29,380, and on April 12 they tested the psychological level of $30,000. The price went up to $30,550.

The locomotive for the whole market was Ethereum (ETH). On the night of April 12-13, the Shapella update was successfully activated on the main Ethereum network, after which it became possible to withdraw blocked tokens from staking. There was no reaction to the network update. Apparently, investors wanted to see how staking would behave after coins were withdrawn. The effect was delayed. The Shapella update boosted trading volumes and supported the bullish trend of the major altcoins. The ETH/USDt pair was up to $2,128.

On April 12, the U.S. Labor Department released its inflation report. The consumer price index rose 0.1% month-on-month and 5% year-on-year. Although, of course, everyone was expecting inflation to match the 0.2% m/m and 5.2% y/y forecasts. The inflation report couldn’t stop Bitcoin’s rise. That’s because the rise was supported by the Ethereum rally. And then the dollar also fell to 101.16p after rising.

On April 14, the pair BTC/USDt was rising to the level of $31,000. It was not possible to move higher – the dollar turned up and the indices went down. The dollar rose at the end of the week on strong industrial production data, which rose 0.4% in March after rising 0.2% the previous month (the forecast was +0.2%).

Cryptocurrencies have gained a trump card.

By the end of the day U.S. stocks closed the day down. But they recorded weekly gains across the board. Investors appreciated the weak retail sales report. Which undermined the enthusiasm about the start of the quarterly reporting season.

Cryptocurrencies have gained a trump card. Democrats and Republicans continue to play the political game of who will do more damage to the United States. Congressmen are haggling and the Treasury Department is paying higher interest on debt service.

Democrats and Republicans continue to play a political game of who will do more damage to the United States. Congressmen are haggling and the Treasury Department is paying higher interest on debt service.

On April 11, the cost of U.S. default insurance jumped to the highest level in a decade. Default insurance on 5-year U.S. bonds rose to 42.91p.

In 2022, the U.S. paid $853 billion in interest on its government debt. This year, the amount of interest payments on government debt could reach $1.2 trillion to $1.5 trillion. Yellen warned that the government has enough money until June. The country could face default in July or August. Right now, it doesn’t matter if there is a default or not. Bitcoin and gold could act as protective assets against it. Gold in physical form and Bitcoin in digital form.

The technical picture for Bitcoin is favorable for continued upward movement. Now we can head to the area of $34-35 thousand. For ETH the nearest target is around $2,770.

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What will happen to Bitcoin price next after $30k

Our experts told about the prerequisites for Bitcoin price growth. And assessed the prospects for further price movement of the first cryptocurrency

On April 11 Bitcoin rate exceeded $30.3 thousand for the first time since June 1, 2022. Within a day, the first cryptocurrency rose in price by $2 thousand. And its value increased by 7%.

Leading altcoins also rose in price, though not as much as the first cryptocurrency. Ethereum (ETH) price went up by 3.5%, to $1.91, BNB (BNB) – by 4.6%, to $327, Polygon (MATIC) – by 3.2%, to $1.13. Cardano (ADA) gained 4.7% to $0.4 and Ripple (XRP) rose 2.7% to $0.51.

The first goal for Bictoin is to fix it at $30,000

Bitcoin for the first time in 10 months broke through the key level of $30 thousand. The main trigger for the price increase was the investors’ confidence in the near completion of the US Federal Reserve’s tight monetary policy phase. In fact, the strengthening of BTC could happen a few days earlier. But most investors were absent in trading because of Good Friday and Easter in Catholic world.

On Monday traders returned to work and reacted to Friday’s set of statistics about employment market in the USA. And quite naturally – with a rise in prices. NFP employment data showed that employers feel confident and leave hiring rates high.

BTC has gained 6.74% since the beginning of April versus a 23% appreciation in March. The important thing now is to get a foothold above $30k. And the next ambitious goal is $35k, but it will take time to reach it.

Bitcoin price prospects

Bitcoin moved to the growth after a long period of consolidation between $27 thousand and $28.5 thousand. BTC accumulated momentum and was able to overcome the resistance level around $28.5 thousand. And then on a wave of “bullish” sentiment took a new top – the long-awaited mark of $30 th.

It is hard to say whether there will be correction, because the market is waiting for the publication of data on consumer price growth in the USA (CPI). Which will be unveiled on April 12. This index always influences the situation on the cryptocurrency market. Here we should understand that it can both push up. And it can also push down and stop the growth of Bitcoin. And the continuation of high inflation can have both effects. That is, if inflation is still quite high and fails to meet expectations for a decline. BTC rate may react with both decrease and growth in the short term.

In the long term high inflation will most likely help Bitcoin to grow. Because BTC is seen by some investors as an instrument to hedge against inflation risks. The collapse of the banking system, which is not expected to fully manifest itself yet, also contributes to the growth of bitcoin. Part of the deposits that have been withdrawn from U.S. bank accounts. It eventually settles on the crypto market, as retail investors in a panic are looking for tools to preserve value. And they’re also afraid of a repeat of the 2008-2009 crisis.

Our experts answering a possible question whether investors will have an opportunity to buy Bitcoin “cheaply” for $15 thousand. Our experts remind that between $15k and $25k Bitcoin was trading for 275 days. That means investors had almost a year to decide to buy this asset. If they didn’t do that, now they’ll have to buy bitcoin at $30k. In short and medium term the price of BTC will hardly go lower than $20k.

Expect inflation data

Bitcoin for quite a long time was in the “sideways position”, accumulating strength for a breakthrough to the level of $30 thousand. This happens today the coin has overcome this mark.

Now the US inflation data is expected to be released in March. A slowdown in price growth will be positive for the stock market. And BTC usually follows it. A decline in inflation gives the odds that the Fed will move to easing monetary policy. And this will also push indices and cryptocurrencies up.

Also amid forecasts of a global recession, more and more investors are moving into crypto as a way to protect funds. This explains the influx of capital into the crypto market. Now everything depends on inflation data. Because its decline will give a chance for Bitcoin to rise to $32,000-34,000. And the increase in prices will be negative – then we can expect a fall to $27-28 thousand. By the end of the week, these trends will manifest themselves in full force.

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Growth rate of long-term holders of BTC reached its max in 2 years

The number of BTC “hodlers” is increasing as fast as it did in the spring of 2021. When the asset first reached $64,000.

The number of long-term Bitcoin holders earlier this year is growing at its fastest pace since spring 2021. When the BTC exchange rate first rose to $64,000. The growth in the number of “hodlers” may be due to the fact that more and more traders stop operations and decide to just keep the asset.

Since the beginning of this year, Bitcoin’s exchange rate has increased by 71%. The asset was trading at $16.5 thousand on January 31, while on April 10, its price was around $28.3 thousand. The maximum value for this period was $29.1 thousand, which BTC crossed on March 30 for the first time since June 2022.

During the 2021 Bitcoin rally, the number of BTC holders rose from about 34 million to 39 million. The growth rate then slowed. And by early 2023, that number had risen to about 44 million. But then the number of “hodlers” started growing faster again. And by April, it exceeded 46.1 million.

Our experts note that over the past 24 hours, BTC rose in price  by 6%, to $30 thousand. Following the first cryptocurrency, prices for other digital assets are increasing.

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Large Swiss bank will open 2.5 million customers to cryptocurrencies

PostFinance, Swiss national postal service’s bank division, will give customers access to buy, hold and sell Bitcoin and Ethereum

PostFinance, the Swiss post office bank, will partner with Sygnum Bank, a Swiss digital asset bank, to open up cryptocurrency transactions to more than 2.5 million customers. The cryptobank said in an announcement that PostFinance customers will be able to buy, store and sell cryptocurrencies such as bitcoin and Ethereum.

PostFinance is one of Switzerland’s largest retail banks. It is wholly owned by the Swiss Post, which in turn is owned by the state. According to the bank’s website, more than 2.5 million people use its services.

Bank Sygnum is licensed as a provider of cryptocurrency services in Switzerland. And it serves a range of institutions, including cantonal and private banks. PostFinance is integrating Sygnum’s b2b platform into its infrastructure.

According to the report, PostFinance has analyzed the investment needs of its customers. And it identified a high demand for digital investment services.

“Digital assets have become an integral part of the financial world. And our clients want access to this marketplace at PostFinance,” said PostFinance Chief Investment Officer Philip Merkt.

PostFinance’s decision to switch to cryptocurrency was driven in part by an outflow of funds from Swiss retail banks into the digital asset class.

PostFinance has noted a multi-million dollar outflow of funds to cryptocurrency exchanges in recent years. So not only did the bank see an opportunity to generate new revenue in its work with digital assets. But it also realized that it made a big difference in retaining existing customers.

Our experts note that in addition to Bitcoin and Ethereum, PostFinance will later add other cryptocurrencies.

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The excitement for risk has returned. What will happen to Bitcoin in this week

Our experts have analyzed the situation on crypto market and told how it can change in the short term and what will happen to Bitcoin price

The final week of March on the crypto market began with a decrease in the pair BTC/USDt. Bitcoin fell by 5.81% to $28,484. The fall was caused by negative news in the crypto industry. The Commodity Futures Trading Commission (CFTC) filed a lawsuit against the head of Binance, Changpeng Zhao, and the heads of three other organizations that run the Binance platform. The regulator claims that the exchange failed to register as a platform that trades cryptocurrency derivatives. And therefore had no right to provide services to U.S. clients. However, it actively worked with U.S. investors, ignoring legal regulations.

In zone $26.5-26.6 thousand buyers regrouped and fought back on the positive news from the banking sector and the rise of American indices. The U.S. Federal Deposit Insurance Corporation (FDIC) announced that deposits and loans from bankrupt Silicon Valley Bank (SVB) are going to U.S. First-Citizens Bank.

On March 29, bitcoin recouped earlier losses, returning to the $29,184 level. Risk appetite returned for market participants as concerns about the banking sector eased following congressional hearings on the SVB bankruptcy.

Rising movement did not continue. The buyers, having met sellers’ volumes, started to fix profits from long positions. It was a purely technical factor, because this day external background was on the side of buyers. Also the dollar index was declining and S&P 500 futures were rising.

In the evening the buyers’ activity might have been low because of the speeches of the U.S. Federal Reserve representatives, who supported the further tightening of the monetary policy, despite the collapse of the three American banks.

On Friday (March 31), the price corrected to $27,511 and then went back to $28,656. Buyers have so far ignored the U.S. crackdown on Binance, Coinbase and TRON founder Justin Sun. This comes amid a rally in stock indexes and weakness in the U.S. dollar.

The S&P 500 index rose 3.23% to 4,109 points for the week and 6.88% for the quarter. Bitcoin in the first quarter of 2023 rose 72.08% against the dollar to $28,465.

Waiting for a level test of $30,000 for Bitcoin

In this week of April 3-9, the focus of market participants will be on U.S. statistics. These statistics will include: business activity in the manufacturing and services sectors, industrial production data, the labor market report for March. In Europe, it is a shortened week. Europeans will celebrate Good Friday on Friday (April 7) and Easter on Monday (April 10). Liquidity will affect the dollar, and through the currency market, the crypto market.

According to our experts’ estimates, the quarterly timeframe indicates a price recovery to $34,000. At the same time, the monthly – to $43,000 by August (with a very positive external situation). If the market gets stormy because of the actions of U.S. regulators or new bankruptcies, then by mid-September. Here we need to look at what wave structure of upward movement will be formed when the level of $34,000 is reached. Therefore, we are waiting for the test of $30,000 for Bitcoin this week.

 

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Crypto Spring, from which altcoins to expect maximum growth

Our experts talked about trends in the cryptocurrency market. And pointed out several altcoins worth paying attention to

Start of 2023 was positive not only for Bitcoin supporters, but also for almost the entire cryptocurrency market. The leading coin has risen in price by 36 % since the beginning of January. And some alternative coins rose in price by tens of percent.

However, not all assets linger at their peak values after significant growth. Often tokens both reach new ATH and fall off.

Our experts told us what affects altcoin rates. And which coins look promising at the moment. And also what risks an investor who wants to invest in cryptocurrencies may face.

Promising altcoins

Cryptocurrencies such as Ethereum (ETH), Litecoin (LTC), Ripple (XRP) and Monero (XMR) have the best long-term growth prospects among altcoins. At the moment, it is worth investing only in those assets that can grow in value over the long term.

Of altcoins worth considering for purchase, tokens related to artificial intelligence (AI) may be worth considering. He noted that the trigger news for this area was a statement from Bill Gates. Who said that AI is “a really big deal” and that AI projects are revolutionary.

Another trigger for the increased attention to tokens related to AI. Our expert pointed to a post by Elon Musk. The billionaire wrote on Twitter that 2023 will be the year of AI. However, such statements are partly provoked by the emergence of ChatGPT neural network. Although it does not meet the criteria of general artificial intelligence, it has created a lot of hype in a market.

In the opinion of our expert, it is worth looking at Ocean Protocol (OCEAN) and Fetch (FET) tokens. However, FET is already trading at local highs. And in order to enter it will be necessary to wait for its correction first. Which is likely to happen in February, our specialist warned.

Ocean Protocol is a data trading platform. Including those used in the work with artificial intelligence. The main goal of the Ocean network is to create a global data supply chain for AI. The OCEAN Protocol token rose 125% in a month, from $0.16 to $0.36. The current price is 81% below the all-time high of $1.93 shown in April 2021.

Fetch is a project to build a decentralized “economic Internet” infrastructure based on artificial intelligence and machine learning. The goal of the project is to optimize the use of resources, to automate processes. As well as the development of algorithms for collective learning of Internet of Things (IoT) devices. The FET token went from $0.095 to $0.28 in a month, up 194%.

Risky investments

Because there are no fundamental prerequisites for a long-term bullish cycle in crypto market yet. The current growth of altcoins is accompanied by high volatility. Our expert noted that this is the reason for their recent growth. We should expect the same significant correction in the next couple of weeks.

At the same time, the expert reminded that altcoins always have risks – it is even more risky asset than Bitcoin. When the market is nervous because of macro signals from regulators. The first thing investors do is to sell such excessively risky assets.

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Mining companies increased in price due to growth of Bitcoin rate

Growth in securities of mining companies in January reached the highest monthly level in at least a year. Crypto-Upvotes expert review

The MVIS Global Digital Assets Mining Index, which includes data on the 20 largest miners. Such as Riot Blockchain, Galaxy Digital, Bitfarms and Iris Energy, is up 64 percent since the beginning of January 2023. This month, the indicator posted its biggest increase since its inception in December 2021. In doing so, Bitfarms securities rose more than 140%. And shares of Marathon Digital Holdings were up more than 120%. And Hive Blockchain Technologies more than doubled.

The growth of miners’ shares was caused by the recovery of Bitcoin. The first cryptocurrency since the beginning of January rose in price by 26.5% – from $ 16.6 thousand to $ 21 thousand. And on January 16 Bitcoin rate updated its maximum for 4 months, exceeding the mark of $ 21.4 thousand.

Profits of miners also increased against the growth of the crypto market. Despite the fact that the complexity of Bitcoin mining has grown to record levels. And more and more miners are plugging in, increasing hash rates. Luxor Hashprice Index – showing how much income a Bitcoin miner can expect. With a certain amount of hashrate – up 21% this year.

However, our experts note that it is unknown how long the growth of mining companies’ quotes will last. Cryptocurrency mining companies faced financial difficulties in 2022 and were forced to sell the mined cryptocurrency. As well as to return the equipment, reduce costs and personnel.

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