Our Crypto-Upvotes experts have analyzed situation with Bitcoin on crypto market and told how it can change in next month.

Situation on cryptocurrency market completely depends on dynamics of American stock indices. Which collapsed after the speech of head of the Federal Reserve J. Powell at a conference in Jackson Hole. Over last 30 days, the correlation between Bitcoin and the S&P500 index is 0.77. Accordingly, if the U.S. stock market crashes. Then all risky assets, including cryptocurrency, will also collapse.

Fed is set to take control of inflation and is ready to aggressively raise rates to the detriment of the economy. Fed interest rate futures are pointing to a 75 basis point hike with a probability above 70%.

Since the Jackson Hole symposium, the technical picture for bitcoin has deteriorated. Sellers have broken down trend line from the low of $17,600 (June 18, 2022). They are restrained by support of $18-19 ths. below it the nearest target is near $12.5 ths.

Bitcoin technical analysis shows that situation has worsened

Investors’ attention is now riveted on US non-farm payrolls (NFP) data for August. According to the forecast, they are expected to show an increase in the number of employed people by 300 ths. compared to growth of 528 ths. in July. A strong jobs report will bolster expectations for the Fed to continue its aggressive 75 basis point rate hike. A sharp rate hike is a rally in the dollar and a decline in Bitcoin.

There was also another negative factor which had a negative impact on all risky assets in Asia. Chinese authorities imposed quarantine in Chengdu because of the COVID-19 outbreak. In the past two weeks in Chengdu about 600 patients with COVID-19 and about 300 asymptomatic carriers of coronavirus were identified. 21 million residents will remain in their homes. Businesses will close. Asian markets were followed by declines in European markets. As a result, futures on the S&P500 went down and pulled the pair BTC/USDt.

Also US dollar draws strength from the weakening of the single currency. Because of the energy crisis in Europe, gas prices are rising in Asia and the U.S.. This in turn leads to unwinding inflation in the world. Gas prices in the U.S. and Asia are rising after those in Europe. And the U.S. Fed is fighting inflation by raising rates. Since the euro accounts for about 57% of the dollar index.

Key event in September will be the U.S. Federal Reserve’s meeting. Investors fear a recession from a tightening of monetary policy by the U.S. Federal Reserve. A collapse in indices will trigger a fall in cryptocurrencies. Because buyers failed to pass the $25,500 level in mid-August, sellers continue to control market. The more the indexes fall, the more bitcoin will fall.

In next year, cryptocurrency market will be turbulent

So far, the situation for the technology sector and cryptocurrencies, which are strongly correlated with IT stocks, is alarming. Jerome Powell recent statements about the possible next key rate hike. And remaining inflation risks gave a signal to investors that the market will be turbulent in the next year. It is worth to be patient or to exit from high-risk assets in order to keep capital.

In our view, Bitcoin will continue to trade between $18K and $21K in September. We believe BTC will not even make it to $25K during September.

The biggest losses this summer were the hackers attacks on Nomad Bridge and the Elrond blockchain network. These two projects together lost more than $300 million. Ctypro-Upvotes expert review.

Hackers have stolen more than $446 million worth of cryptocurrency in 3 summer months as a result of hacks. According to Peckshield, in August alone, the loss from 18 attacks on crypto projects was $208.5 million. In July there were 12 hacks worth $10.2 million. And in June 21 attacks resulted in $227.76 million stolen.

The largest loss was to Nomad Bridge blockchain in early August – $190 million. Elrond blockchain was hacked in June for $113 million. Also, Horizon Bridge was hacked in June, with hackers taking $100 million out of that project.

Some of the platforms announced rewards for hackers in case of return of stolen funds. So, a contract was signed with hacker who hacked the Crema Finance protocol in July. According to this agreement, he kept 45,500 SOL ($1.65 million) and returned the rest of stolen funds of $7.9 million.

Blockchain bridge Nomad offered hackers to keep 10% of total stolen funds. About $36 million in various cryptocurrencies were returned to Nomad Bridge official address, out of $190 million stolen on August 1.

Binance announces measures to protect customer funds in case of ETH network hardfork

Cryptocurrency exchange Binance will suspend withdrawals and deposits of ETH and ERC-20 tokens during the “Merger” (blockchain’s migration to Proof-of-Work protocol). In an official announcement, platform team announced measures. Which will be taken to minimize trading risks. And to protect customer funds in case of a split network and the emergence of a second Ethereum token.

Deposit and token withdrawal transactions will be suspended on the platform on September 6 during the Bellatrix update. And also on September 15 during the Paris update. The exchange will suspend Binance Crypto Loans. As well as ETH margin borrowings between September 14 and 16.

Spot trading of ETH and ERC-20 will not be affected during Ethereum update. However, Binance has drawn attention to the risk of increased volatility in the event of a hardfork. And reserved the right to suspend margin trading.

In the case of network splitting and new ETH token emergence. Binance will use ETH ticker for PoS Ethereum chain. Withdrawals for another version of token will be supported. But distribution details will be covered in a separate announcement.

Coinbase will suspend Ethereum operations during the “Merger” of network

Cryptocurrency exchange Coinbase announced in its blog. That new deposit and withdrawal transactions in ETH and ERC-20 tokens will be temporarily suspended on Coinbase during Ethereum Merge (blockchain update). Transactions launched before the suspension will also be temporarily delayed.

Coinbase team stated that this will be done as a precautionary measure. To ensure that customer funds are protected. Once the update is complete, processing of suspended transactions will be restarted.

“Merger” is tentatively scheduled for September 15. Customers of Coinbase Prime and Coinbase Exchange services may encounter delays in withdrawals. That’s why Exchange recommends customers to withdraw funds in advance, if necessary.

Users of Coinbase Wallet with ETH and ERC-20 tokens. As well as NFT or DeFi products of Ethereum network, this update should not affect them.

Our experts recommend withdrawing the necessary funds from CEX exchanges in advance. Or convert them to other cryptocurrencies at the time of ETH network update.

Forbes conducted a study of Bitcoin transactions. It showed that estimates of platforms that are considered reputable do not reflect real picture of BTC trading volume.

More than half of the trades on exchanges with BTC are fake. According to a study conducted by Forbes. The reasons are so-called “wash trading” and poor monitoring of exchanges.

Wash trading is when a trader repeatedly buys and sells the same asset over a short period of time. Thus trying to mislead other market participants about price or liquidity of asset. The purpose of these operations is to inflate trading volume and create the appearance of growing popularity of the asset. The Forbes article notes that wash trading also benefits exchanges.

The study found that BTC trading volumes calculated by platforms considered reputable do not reflect the real picture. Resources such as CoinMarketCap, CoinGecko, Nomics and Messari give completely different estimates of daily Bitcoin trading. Forbes estimated the total daily trading volume of bitcoin on June 14 at $128 billion. This is half as much as the $262 billion volume reported by these platforms.

The most problematic in terms of counterfeit volumes are platforms. Which report big numbers but operate with little or no regulatory oversight. These are the likes of Binance, MEXC Global and Bybit. In total, less-regulated exchanges account for about $89 billion in real trading volume, according to the study. Whereas according to these platforms, the index was at $217 billion.

Opinion

Our experts are not surprised that volumes of BTC and other popular cryptocurrencies can be fake. Because we see large volumes on many non-popular exchanges. But in fact many of them don’t have big amount of users for those volumes which they show. So it’s not surprising that even big platforms like Binance use fake volumes.

But we believe that in the near future many exchanges will no longer be able to do this. Because many countries are restricting and starting to strictly regulate all major CEX exchanges.

For the first time in 2022, organizers of awards have added a category “Best Performance in Metaverse”. Snoop Dogg, Justin Bieber, Ariana Grande and Twenty One Pilots are also nominated. NFT becomes part of music.

Eminem and Snoop Dogg will perform the track “From The D 2 The LBC” at the MTV Music Awards. It was created in collaboration with the NFT collection Bored Ape Yacht Club (BAYC).

The music video for “From the D 2 the LBC” was released along with a single. Directed by James Larez, the video alternates between footage of the rappers and animation in which they are presented as NFT avatars.

Our experts found out on the day of the single’s release, Eminem and Snoop Dogg performed the song at ApeFest. Which was held in New York City for  holders from the BAYC collection.

Cryptocurrency storage platform BitGo failed to provide audited financial statements by a certain deadline. It violated terms of deal with Galaxy Digital. Review by our Crypto-Upvotes experts.

Galaxy Digital withdrew its offer to buy cryptocurrency service BitGo for $1.2 billion. The cryptocurrency storage platform violated the terms of the agreement. It failed to provide audited financial statements for 2021 by July 31.

Galaxy Digital said there was no liquidated damages due to the termination of the agreement. The company first became aware of its plans to buy BitGo in May 2021. The deal was scheduled to close in the fourth quarter of 2021. The deal between Galaxy Digital and BitGo could be the first “billion-dollar” deal in a cryptocurrency world.

At end of the second quarter of 2022, the total loss of Galaxy Digital reached $554.7 million. Company continues to consider a listing on the Nasdaq.

Resorts in Soneva hotel chain can now be paid for in Bitcoin or Ethereum, review by our experts Crypto-Upvotes

Resort chain Soneva hotels in Thailand and the Maldives are now accepting payments in Bitcoin and Ethereum. Cryptocurrency payment provider TripleA and payment platform Pomelo Pay are helping to make payments.

The cryptocurrency payment option will be available at Soneva Fushi hotels. As well as Soneva Jani and Soneva in Aqua in Maldives. And in Soneva Kiri in Thailand. Also for Bitcoin and Ethereum it is now possible to buy real estate in the Maldives at Soneva Villa Ownership.

The resort network can directly book rooms. And pay with cryptocurrency through a secure link. In addition, you can use a QR code to pay in cryptocurrency. Soneva adds that while any payments made using Bitcoin or Ethereum are 100 per cent non-refundable, credits can apply in line with its flexible cancellation policy.

“At Soneva, we have always endeavoured to be a pioneer in the hospitality industry, hence accepting cryptocurrencies as a payment method is another example of enabling our international guests to easily make payments from anywhere in the world,” said Bruce Bromley, chief financial officer, and deputy CEO of Soneva.

Our experts told us what prevents Bitcoin from rising in price. And what the prospects are for it to return to its maximums as it was in fall 2021

In November 2021, 12 years after its appearance, Bitcoin reached a price high of about $69,000. On January 1, 2022, the cryptocurrency was trading at $46,200. In June, its price fell to $17,600, renewing its low from December 2020.

Proponents and critics of cryptocurrencies make various predictions about the direction in which Bitcoin will go next. And what levels it may reach.

Optimistic prognosis

A return to the historical high around $69,000 is hardly possible on the horizon of the next 12 months.

Our experts believe that the fundamental factors for Bitcoin growth. Growth in the cost of money in USA and Europe (an increase in key rates) is necessary. Despite the existing name of BTC “digital gold”, it has not yet become a protective asset. But nothing prevents BTC from becoming such in the future.

With the current volatility of Bitcoin, its price can change by $20,000 in half a year. And if volatility does not increase, the approach to the historical highs will not happen earlier than in a year.

Pessimistic prognosis

Bitcoin follows the rate of U.S. stock exchanges. And this has been observed for a long time. For example, during the growth of indices, the price of bitcoin also grows. And during the fall – it goes down. The downtrend on the U.S. stock market is for a long time. Because the dynamics of inflation in the U.S. promises a further increase in Fed rates. And accordingly, a decrease in the quotations of the technology sector.

Our expert says that according to different estimates, recovery of stock indices in USA. Which have lost more than 10% since the beginning of the year, will take at least three years. That means the same recovery period to record levels can be predicted for Bitcoin. Most likely, the coin will reach above $60,000 only in 2025.

Our experts told about its effect on cryptocurrency market “Merger” of Ethereum , and what will happen if it fails.

According to Ethereum developers’ plans, the blockchain update, also known as The Merge. Or Ethereum 2.0, is planned for second half of September. It is aimed at improving the efficiency and scalability of their network.

The speed of transactions in the network will increase to 100,000 TPS (transactions per second). It is now around 15 TPS, according to analytics platform Kaiko. The update will also improve Ethereum’s protection against coordinated attacks. Such as the 51% attack. In which, the person who controls most of the network. Can forcibly make fraudulent changes.

Phase 0 of the Ethereum 2.0 update, the Beacon Chain, was launched on December 1, 2020. Phase 0 began the blockchain’s transition to a proof-of-stake (PoS) algorithm. Its full implementation will mean the end of ETH mining.

Networks such as Ropsten and Sepolia have already switched to the new protocol. And on the morning of August 11 developers have successfully completed Goerli’s latest testnet upgrade. The tentative start date for the main network migration is September 19.

The cryptocommunity suggests that a bifurcation of the blockchain may occur during the “Merge” process. In this case, two parallel networks will emerge, each of which may have its own ETH token. Also, an update failure cannot be ruled out. These events could have an impact on the cryptocurrency market and token rates. Since the market was sensitive to Ethereum price changes after the completion of test updates.

Increased uncertainty in a crypto market

A failure of the transition to ETH 2.0 is unlikely. As all current updates in test networks are successful. In the worst case, the timing of the transition can be shifted, but not the refusal of the update and not its failure.

That said, the risks of a fork of ETH with a split into two coins, PoW and PoS, have increased in recent weeks. In the case of a fork, the PoW version of ETH will be more in demand at the expense of miners for the first time. Because of the continued ability to mine and accumulate tokens. However, in the long run, the PoS version will be more interesting for investment.

Splitting the network is not dangerous in terms of problems for the team and Ethereum project. But it could lead to uncertainty in cryptocurrency market. For example, it is unclear how long it will take to stabilize tokens, networks, exchanges and wallets. Which will have to account for not one, but two new protocols and two tokens.

Possible temporary collapse of Ethereum price

The market is already pricing in an option with a possible Ethereum upgrade. When the blockchain completely moves to the POS algorithm, there will not be any immediate reaction. If everything is “good and positive” with the market. Then ETH exchange rate will go up one way or another.

If the update will fail or will be postponed. Most likely there will be a local temporary dump of ETH price.

Ethereum has a lot of potential, especially after moving to PoS. There will be additional interest in it. Users will start investing in ETH to create nodes and get extra income from it. Our experts also said that it will open a road for institutional investors. And Ethereum itself will become more environmentally friendly due to the fact that less electricity will be used to mine it.

Poloniex and MEXC began trading ETHW and ETHS tokens in anticipation of Ethereum updates. And BitMEX launched trading in futures contracts.

Three crypto exchanges have supported trading of tokens that may become available after hardfork Ethereum. Last week, Poloniex and MEXC announced the launch of ETHS and ETHW trading. And on August 8, BitMEX launched a futures product based on ETHPoW tokens.

Poloniex and MEXC allow Ethereum holders to exchange their cryptocurrency for ETHS and ETHW at a 1:1 ratio. These tokens function like derivatives and allow users to trade blockchain assets that have yet to launch.

On these exchanges, ETHS trades at a price close to Ethereum, while ETHW is much cheaper and trades in the $125-130 range.

In case two blockchains are formed. Then these exchanges will support the holders of both tokens.

If the ETH 2.0 update is completed without a blockchain fork. The cryptocurrency will keep its previous name ETH. In this case, Poloniex and MEXC will suspend and exclude ETHS, ETHW and related markets.

Our experts also noted that сryptocurrency exchange Binance has also announced that it will consider supporting new Ethereum tokens. Binance team has announced support for the upcoming Ethereum update. However, it warned that all new hardfork tokens will undergo the same strict verification process before listing on Binance as any other coin.