News On Bitcoin - Week 39 2024

Weekly update on all things Bitcoin

October 01, 2024

TL;DR

  • BTC is up

  • Bitcoin dominance is down

  • BlackRock Tightens Bitcoin ETF Rules

  • Top Finance Figures Embrace Bitcoin

  • Trump Advocates Crypto to Address U.S. Debt

  • PayPal Allows Businesses to Trade BTC & Crypto

  • Boltz Launches BTCPay Plugin

  • BitcoinOS Introduces BitSNARK for Privacy

  • Bitfarms and Riot Settle Takeover Dispute

  • Swan Bitcoin Sues Ex-Employees Over Alleged Theft

  • Clarifying China's Bitcoin Hashrate Control

Bitcoin Price

Crypto is up this week, with BTC being up 4.4% and ETH up 5.3%:

Bitcoin dominance has decreased over the week, rising from 54.6% to a peak of 54.62% and ending at 53.84%. Bitcoin is down due to strong bullish momentum, altcoin performances, successful breakouts above key levels, negative market sentiment, and ongoing institutional interest.

It’s going to be interesting to see whether this trend will continue in the short term, as capital in crypto tends to flow initially to BTC and then further out on the risk-curve, starting with altcoins like ETH and then into mid- or low-cap coins.

Bitcoin (BTC) has reached a new two-month high of $66,194, driven by bullish sentiment linked to China's economic stimulus measures, which have propelled its stock market to its best week since 2008.

Analysts note a "familiar bullish smell" in the market, with BTC gaining 3% week-to-date amidst the backdrop of the S&P 500 also hitting all-time highs following a recent Federal Reserve interest rate cut.

Market indicators show BTC holding strong support around $65,000, with shifting liquidity dynamics observed on major exchanges. Notably, the ratio of long to short positions remains low, suggesting potential for upside movement, provided that a higher high is established.

Overall, these developments signal increasing optimism among traders as they monitor macroeconomic trends and liquidity shifts, reinforcing the case for continued bullish momentum in Bitcoin's price trajectory.

Bitcoin (BTCUSD) Analysis:

Bitcoin is currently trading at 65,428.00, showing positive momentum within a short-term rising trend channel. It faces resistance at 71,000 and support around 64,000. While the short-term outlook is positive, the medium term is neutral as Bitcoin trades within a horizontal channel between 53,252 and 67,753.

Despite a high RSI indicating potential overbought conditions, the long-term trend remains favorable. Overall, the recommendation is to remain positive in the short term while holding in the medium and long terms.

Expected Trading Ranges: resistance level at $71,000 and support at $64,000.

Market Outlook

The Bitcoin market outlook is cautiously optimistic, with BTC hitting a two-month high due to bullish sentiment from China’s stimulus and Fed rate cuts. Support at $65,000 is strong, but a higher high is necessary to maintain momentum. A low long-to-short ratio suggests potential for new buyers, though upcoming economic data and the Fed's November meeting could bring volatility. Monitoring these factors will be key for future price direction.

BTC/ETH ratio has seen an increase:

Over the last six days, the BTC to ETH conversion rate has shown a general upward trend, increasing from 24.22 ETH on September 24 to 24.51 ETH on September 28. This represents an overall increase of about 1.29 ETH during this period, with fluctuations along the way, including a slight decrease on September 27. The recent performance indicates that Bitcoin has strengthened against Ethereum in this timeframe.

"It’s fall 2024 — the time has come to orangepill your heroes. The Zeitgeist has shifted and many are now ready to receive. By sending a kind bitcoin message to someone you admire, you’re helping them be more effective in doing good."

Financial News

BlackRock has implemented new rules for its Bitcoin ETF in partnership with Coinbase, mandating that withdrawals be processed within 12 hours to enhance asset transparency and address investor concerns. This amendment comes amid skepticism regarding Coinbase's custodial practices, including fears about the use of "paper BTC" instead of actual bitcoin.

While BlackRock aims to reassure investors about the security and accessibility of their assets, reactions have been mixed, with calls for greater transparency remaining. As the largest asset manager in the Bitcoin ETF market, BlackRock's actions could set a precedent for industry-wide changes in custodial practices.

Matt Hougan, CIO of Bitwise Investments, revealed that nearly 70% of top financial advisors at a recent Barron's summit personally own Bitcoin and crypto. This marks a significant increase from previous years, where only 10-20% reported ownership. Hougan views this shift as a major indicator of growing acceptance among influential finance professionals.

Bitwise, managing over $4.5 billion in assets, recently secured approval for the first U.S. Bitcoin ETF. Hougan expects advisors to start allocating Bitcoin and crypto in client accounts within 6-12 months, driven by increased personal investment. This trend suggests a larger wave of institutional adoption is imminent, validating Bitcoin's growing role in finance.

Donald Trump has embraced Bitcoin and cryptocurrencies during his 2024 presidential campaign, suggesting they could help pay off the U.S. national debt, currently at $35 trillion. He described crypto as having a "great future" and highlighted his historical Bitcoin transaction while purchasing burgers.

Trump's rhetoric aims to appeal to the growing crypto voter bloc, promising to make the U.S. the "crypto capital of the world." Concurrently, Kamala Harris has signaled support for digital assets at a recent fundraiser, indicating a bipartisan interest in crypto policies as both candidates seek to attract crypto-friendly voters.

Adoption News

PayPal Holdings, Inc. (NASDAQ: PYPL) has introduced a feature allowing U.S. business account holders to buy, hold, and sell cryptocurrencies like Bitcoin directly from their PayPal accounts. While this service is available nationwide, it will initially not be offered in New York State.

Jose Fernandez da Ponte, PayPal's Senior VP of Blockchain and Cryptocurrency, emphasized that the decision to expand services was driven by business owners seeking the same cryptocurrency capabilities available to consumers. In addition to trading, U.S. merchants can now transfer cryptocurrency to third-party wallets, enhancing transaction flexibility.

Boltz has introduced the Boltz BTCPay Plugin, enabling merchants using BTCPay Server to accept Lightning payments non-custodially and transfer these funds to the Liquid Network. This "Nodeless" mode allows automatic swaps from Lightning to Liquid upon payment, with the option to swap back to the Bitcoin mainchain.

The plugin includes an integrated wallet system for creating or importing Liquid and mainchain wallets, alleviating the need for merchants to manage a Lightning node. This innovative plugin addresses the complexities of channel management and inbound liquidity, making it easier for merchants to handle Lightning payments.

BitcoinOS has open-sourced BitSNARK, a zero-knowledge verification protocol designed to enhance privacy on the Bitcoin blockchain. This protocol uses zk-SNARKs (Succinct Non-Interactive Argument of Knowledge) to enable private transactions and advanced decentralized applications (DApps) without altering Bitcoin’s core.

BitSNARK, along with innovations like Grail Bridge and Merkle Mesh, aims to expand Bitcoin’s role in decentralized finance (DeFi) and cross-chain applications. CEO Edan Yago stated that BitSNARK will help Bitcoin evolve into a more secure and versatile network. The protocol enables decentralized atomic swaps, cross-chain transactions, and two-way pegging while maintaining network integrity through economic incentives.

Mining News

Bitfarms and Riot Platforms have settled their takeover dispute, limiting Riot’s ownership in Bitfarms to 20% without board approval. Riot currently holds 19.9% of Bitfarms' shares. The agreement also resulted in Bitfarms co-founder Andres Finkielsztain resigning from the board, with corporate governance expert Amy Freedman stepping in.

The special shareholder meeting, initially scheduled for November 6, may be delayed but will occur before November 20 to discuss the company's future and shareholder rights plan. This settlement allows Bitfarms to shift its focus towards growth in areas beyond Bitcoin mining, such as energy trading and high-performance computing.

Swan Bitcoin has filed a lawsuit against several former employees, accusing them of stealing proprietary software to establish a rival mining business, Proton Management. Allegedly, these ex-employees, including the former Head of Business Development and the chief investment officer, devised a plan dubbed "rain and hellfire" to undermine Swan's operations and secure a partnership with Tether, cutting Swan out of its funding agreement.

The lawsuit claims this scheme aimed to irreparably harm Swan's market position, prompting the firm to seek a permanent injunction against Proton and the return of stolen assets, along with jury trial damages.

CryptoQuant founder Ki Young Ju's assertion that Chinese mining pools dominate 55% of Bitcoin's hashrate overlooks important nuances about miner distribution. Although pools like Antpool and F2pool are based in China, they include miners from around the world, including the U.S.

In August 2024, U.S.-based pools such as MARA Pool and Foundry mined a substantial portion of Bitcoin blocks, illustrating that hashrate contributions are not confined to national borders. Additionally, as China revisits its crypto regulations, including potential anti-money laundering measures, the landscape of Bitcoin mining remains complex and evolving.

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