Из жизни альткоинов

The US Congress could catalyze a more significant shift than introducing spot Bitcoin ETFs. Bitwise Chief Investment Officer Matt Hougan’s view underscores a pivotal moment for the crypto industry.

Hougan suggests that 2024 could see “groundbreaking” legal frameworks that pave the way for mainstream stablecoin adoption, which might profoundly impact the crypto ecosystem.

A Legislative Leap Forward

Recent remarks by Maxine Waters, Ranking Democrat of the House Financial Services Committee, highlighted progress towards stablecoin regulation.

Waters’ announcement that she and Committee Chair Patrick McHenry are close to finalizing a stablecoin bill indicates bipartisan momentum, which could soon materialize into law.

Matt Hougan emphasized the underappreciated significance of this development in his recent communication to Bitwise clients. He believes comprehensive legislation could anchor stablecoins in the mainstream financial system, potentially enhancing their role in global economics.

Hougan identifies multiple drivers behind the bipartisan push for stablecoin legislation. One significant factor is the potential for stablecoins to “bolster” the US dollar’s dominance as the global reserve currency.

Moreover, stablecoins are major purchasers of US Treasuries, placing them among the top sovereign holders globally.

The economic incentives are equally compelling, according to Hougan. For instance, Tether’s profitability with minimal staff compared to traditional banking giants like Goldman Sachs illustrates the operational efficiency and financial potential of stablecoins. Such dynamics are enticing Wall Street to advocate for entry into the stablecoin arena.

The Bitwise CIO noted:

You can bet your bottom stablecoin: Wall Street is lobbying to be let into the stablecoin game.

The Bigger Picture For Crypto Investors

The passage of stablecoin legislation could redefine the landscape of financial transactions. Institutions like JPMorgan might transition from crypto skeptics to proponents, integrating blockchain technologies into their operations.

Hougan predicts that adopting crypto wallets, combined with the efficiency of blockchain-based payment systems, could soon become standard, driven by innovations such as Stripe’s “pay with stablecoins” feature and Visa’s analytics on rising stablecoin usage.

While stablecoins do not offer appreciation potential, investors can find opportunities in the infrastructure supporting them.

Hougan points to Layer 1 blockchains like Ethereum and Solana, which host substantial stablecoin volumes and many decentralized applications (DeFi).

As the legislative environment becomes more favorable, these technologies are poised for significant growth, reflecting a broader acceptance and integration of crypto into mainstream finance. Hougan concluded:

In other words: Crypto is poised to take another huge leap into the mainstream.

Meanwhile, the stablecoin market remains strong, with a capitalization of approximately $166 billion, according to DeFIllama. In contrast, the inflows and outflows in the spot Bitcoin ETF market have been less substantial, highlighting a shift in investor focus as of now.

Yesterday’s ETF flows by @FarsideUK were negative once again, with $83.6 million of outflows.$GBTC had $82.4 million of outflows. Fidelity did $2.8 million of outflows, Bitwise $3.8 million.

Blackrock holding at 0 for 3rd day in a row.

Price dumped after hours because of DTC… pic.twitter.com/ocUF6zUroH

— WhalePanda (@WhalePanda) April 27, 2024

Featured image from Unsplash, Chart from TradingView

Shiba Inu (SHIB) saw a significant spike in a major metric, which signals a bullish outlook for the second-largest meme coin by market cap. Despite this, Shiba Inu’s price has failed to react positively, which can undoubtedly be a concern for token holders. 

Shibarium Sees Increase In Active Accounts 

Data from Shibariumscan shows that the number of active accounts on the layer-2 network rose from 1290 on April 27 to 3,839 on April 28, representing over a 144% increase. Such development is bullish for Shiba Inu, considering how the layer-2 network has been integral to the meme coin’s success since it launched last year. 

Related Reading: Bitcoin To $300,000? Crypto Pundit Reveals What Will Drive It

Shibarium also saw the number of new transactions on the network spike from 4,997 on April 27 to 12,191 on April 28. This is even more bullish for Shiba Inu since the amount of SHIB burns Shibarium carries out depends on the number of transactions it records. Meanwhile, these aren’t the only recent bullish developments for Shiba Inu. 

NewsBTC recently reported that SHIB’s foremost decentralized exchange (DEX), ShibaSwap, is expanding to Shibarium. This move is expected to increase ShibaSwap’s user base and Shibarium’s, by extension. Shiba Inu will ultimately benefit since an increase in Shibarium’s user base means more transactions, leading to more SHIB burns. 

Why Shiba Inu Is Down

Seeing how these metrics paint a bullish outlook for the meme coin, it isn’t out of place to wonder why Shiba Inu has experienced significant price drops lately. One reason for this price decline is Bitcoin’s price action. Data from the market intelligence platform IntoTheBlock shows that SHIB’s price correlation with Bitcoin is currently at 0.82%, which suggests a “strong positive correlation” between both tokens. 

Related Reading: BlackRock Spot Bitcoin ETF Grinds To A Halt, Records Longest Stretch Without Inflows

Therefore, SHIB’s price has mirrored Bitcoin’s, which has recorded significant price declines lately. Another reason for Shiba Inu’s price decline is the drop in large transactions, with data from IntoTheBlock showing a 4.60% drop in this crucial metric. 

This suggests that Shiba Inu whales are cooling off on their investment in the meme coin, as this recent market downtrend may be affecting their confidence. These whales play a massive role in SHIB’s price discovery, and the meme coin’s price could pick up once they recover their confidence in the market. 

A drop in Shiba Inu’s burn rate has also contributed to its recent decline. Data from the burn tracking website Shibburn shows a 76% decline in the number of SHIB tokens burnt in the past seven days and a 79% decline in the last 24 hours. 

US-based crypto exchange Coinbase has taken a major step forward in the digital payments space by introducing support for the Bitcoin Lightning Network. This allows users to make instant and cheaper Bitcoin transfers. 

Bitcoin Lightning Network Integration On Coinbase 

According to Tuesday’s announcement, the integration of Lightning Network into Coinbase aligns with the company’s goal of creating a “global payment system that is affordable and fast for its users.” 

Previously, Bitcoin transfers on Coinbase were processed on-chain, which often took a “significant” amount of time, ranging from 10 minutes to 2 hours, and was more expensive.

In contrast, the Lightning Network, which operates as a layer on top of the Bitcoin blockchain, enables fast off-chain Bitcoin transfers at a fraction of the cost.

The exchange further pointed out that the Lightning Network has experienced steady growth since its inception in 2017, generating increased demand from Coinbase’s customer base. 

With this latest integration, Coinbase users can perform instant Bitcoin transactions directly from their Coinbase accounts via the Lightning Network, including sending, receiving, and making payments. Coinbase stated on the matter:

Bitcoin is one of the most important assets in crypto and since our inception, we’ve continued to support the Bitcoin ecosystem through our exchange and numerous investments through Coinbase Ventures. Adding support for Lightning furthers the growth of the crypto ecosystem by increasing everyday utility for millions of Coinbase customers.

Regional Limitations Apply

Coinbase’s partner company, Lightspark, was pleased with the launch, emphasizing the role of the Lightning Network in enabling Coinbase customers to instantly send, receive, and transact with Bitcoin directly from their Coinbase accounts powered by Lightspark. 

It is important to note that Coinbase’s Lightning Network integration may not be available in all regions, and the cost comparison between Lightning Network and the traditional Bitcoin network may not apply universally to all transfers. The announcement concluded by stating the following:

Coinbase is excited to continue revolutionizing the traditional payments system with crypto. Faster and cheaper access to money is critical to bridging gaps in accessing financial tools, especially for underbanked and unbanked communities. These blockchain-based innovations will unlock capital that is caught up in unnecessary fees and settlement delays, allowing consumers and businesses to do more with their money.

As of the time of writing, BTC has been undergoing a significant downturn following its peak of $67,300 within the past week. It has declined to the $60,700 mark, signifying a substantial decrease in price over broader timeframes. 

Over the past seven days, BTC has experienced an 8% decline, while the past thirty days have seen a drop of over 13%. However, it is important to note that despite these recent fluctuations, the leading cryptocurrency has maintained an impressive year-to-date increase of 107%.

Featured image from Shutterstock, chart from TradingView.com

Though Bitcoin might be shaky, dumping in the London session on April 30, IntoTheBlock data now shows that the market is, after all, solid.

In a post on X, the blockchain analytics platform noted that Bitcoin is in a mid-bull cycle. Despite the price cool-off, potentially accelerated by whales exiting, most BTC holders still profit. 

86% Of BTC Holders Are In The Money

At press time, BTC is inching closer to the $60,000 round number, shrinking 16% from all-time highs. Bitcoin is moving inside a range after sharp gains in Q1 2024. Analysts have sought clear support in the $60,000 and $61,000 zones.

Conversely, resistance is at the $68,000 level, a price point bulls failed to conquer after April 22.

Even at spot rates, IntoTheBlock observes that 86% of all BTC holders are in profit. Although the number is lower, it could suggest prices are in a consolidation phase following Q1 2024 gains.

Bitcoin had broken above 2021 highs by mid-March, rallying to fresh all-time highs of $73,800. At that price level, all users who had bought the coin, even at 2021 peaks, were in the money. 

As prices consolidate, confidence is high across the board. Some analysts expect the coin to explode as bulls resume the uptrend of February through to March. 

Bitcoin Market Is Balanced, Are Whales Entering Or Exiting?

So far, the Market Value to Realized Value (MVRV) ratio is 2.17, which supports this confidence. The MVRV compares Bitcoin’s market capitalization to the total realized value of all BTC in circulation. 

Analysts use it to gauge average profit margins at any price point. Usually, when the MVRV ratio is above 1, it suggests that BTC holders are underwater. Meanwhile, when it spikes above 1, as is the case, it signals that investors can choose to exit by taking a profit.

 Historical data shows that extreme sell-off happens when the MVRV stands above 3.7. At 2.17, the market is generally neutral, with holders optimistic.

Nonetheless, as confidence rises, IntoTheBlock points out some potential roadblocks that might slow down the upswing or, if bullish, accelerate the rally. Over the past week, the platform observed that whales moving transactions of over $100,000 have generated more than $91 billion in trading volume.

This might mean that deep-pocketed investors, including institutions, might be entering–a net positive– or, worse for bulls, exiting the market, slowing down the uptrend.