Bitcoin’s next rally may be imminent, on-chain analyst points out

After a long period of unusually low volatility, Bitcoin’s next major price move is likely imminent and could drive BTC to $32,000, according to James Check, the lead on-chain analyst at Glassnode. That price level is where Bitcoin’s “true cost basis is sitting,” Check explained in an exclusive interview with Cointelegraph. 

To calculate Bitcoin’s average cost basis – the average price at which BTC was bought – Check and his team removed the coins that are lost forever from the calculation and focused on active Bitcoin investors. 

“It’s where the mean reversion level would be, so a rally to that level, to be honest, wouldn’t surprise me,” he said.

Despite this bullish scenario, Check also points out there is likely a large number of investors who are tired of the bear market and are waiting for Bitcoin to reach that level before selling, thus putting pressure on the price. 

“That’s an area where you start getting more resistance,” he pointed out. 

To find out more about the chances of an upcoming Bitcoin rally, check the full interview on our YouTube channel and don’t forget to subscribe!

U.S. debt ceiling crisis: bullish or bearish for Bitcoin?

The United States has hit its $31.4 trillion debt ceiling and is now running out of money. 

As pointed out by Treasury Secretary Janet Yellen, the debt ceiling needs to be lifted before June 1. Otherwise, the country risks missing its debt obligations due to Treasury bond holders and thereby defaulting on its sovereign debt.

Bipartisan negotiations are already underway to lift the debt ceiling, but no agreements is in sight so far. While Democrats want the ceiling to be lifted without any preconditions, Republicans are demanding a number of cuts in government spending as contingencies for lifting the ceiling.

Most experts agree that a U.S. government default would be catastrophic not only for the U.S. economy but also for the global financial system: the stock markets would crash, millions of jobs would be lost, and the economy would likely fall into a recession.

But what are the chances the U.S. government is defaulting on its debt? And what are the impacts of the debt ceiling crisis on crypto and the broader market? We answer these questions in the latest Cointelegraph Report.

Ordinals and BRC-20 will disappear in a matter of months, JAN3 CEO says

The latest hype around Bitcoin (BTC) Ordinals and BRC-20 tokens is unsustainable and will fade away in a matter of months, according to JAN3 CEO Samson Mow. 

“These guys are basically paying massive amounts of fees that go directly to Bitcoin miners, and there is no way this can be sustained,” Mow said in an exclusive interview with Cointelegraph. 

“They will fade away after even months, let’s not talk about years here,” he continued. 

Growing activity around Ordinals and BRC-20 – a crypto technology that allows users to mint fungible and non-fungible tokens on the Bitcoin blockchain – is the main cause provoking a spike in transaction fees, which resulted in the congestion of the Bitcoin network.

Related: Bitcoin BRC-20 token standard becomes new destination for meme tokens

While many members of the Bitcoin community see Ordinals as a use-case that could boost Bitcoin adoption, Mow considers them just as spam clogging the network. 

“These are just short-term money grabs similar to most things on competing chains like Ethereum and Solana,” he pointed out. 

To Mow, mass adoption of Bitcoin will happen because of its use case as a saving technology and as a means of exchange, not because of “people minting JPEGs and sticking them in the chain.”

To learn more about Mow’s argument against Ordinals, watch the full interview on our YouTube channel. Don’t forget to subscribe!

Magazine: $3.4B of Bitcoin in a popcorn tin — The Silk Road hacker’s story

The average person’s wealth will be ‘completely destroyed by inflation,’ says Arthur Hayes

The majority of people will have their wealth progressively eaten away by the devaluation of money, according to Arthur Hayes, the co-founder and former CEO of crypto derivatives exchange BitMEX. 

According to Hayes, due to the huge amount of public debt accumulated by the world’s largest economies, governments will have no choice but “inflating it away” through money printing. 

Thus, the only way to escape the progressive destruction of fiat wealth is by acquiring assets outside the traditional financial system, such as crypto, the purchasing power of which doesn’t fall compared with the cost of energy. 

“My whole goal with all of my investing and is to preserve capital so that I can consume the same amount of energy or whatever energy amount that I would like from now and into the future,” Hayes said in an exclusive interview with Cointelegraph. 

However, the amount of crypto assets available is relatively small compared with the total amount of debt in the economy, which means that only a few will be able to preserve their capital as the majority see their wealth destroyed.

According to Hayes, the crypto crackdown in the U.S. reflects the government’s attempt to keep the masses within the traditional system by preventing them from fleeing to crypto.

“They want your capital sit there and they’ll make it very pleasant, pleasant journey to lose 20, 30, 40, 50, 60% of your purchasing power over a period of time such that the debt load is effectively lowered and the finances are healthier,” he said. 

To find out more about Hayes’ investment thesis on crypto, check out our latest interview on our YouTube channel and don’t forget to subscribe!

SEC’s war on crypto: How far will it go?

The Securities and Exchange Commission (SEC), led by Chairman Gary Gensler, has been at the forefront of the United States’ cryptocurrency crackdown. In the last few months, the agency has filed several enforcement actions against major crypto companies that allegedly violated security laws.

Critics say the agency has adopted a regulation-by-enforcement approach without providing a proper set of rules that fit the unique features of crypto assets. A major source of confusion is the definition of a security and whether it can apply to a highly diverse set of assets such as cryptocurrencies. 

Despite being pressured in a congressional hearing last week, Gensler seems unwilling to take on the political responsibility of entering a constructive dialogue with the industry. 

For many crypto companies targeted by the SEC, the choice is between entering an expensive legal battle with the regulator or shutting down operations in the US and moving overseas. Most crypto companies will likely prefer saving millions of dollars in legal expenses and opt for the latter option.

To learn more about how the SEC has waged war on crypto and the potential consequences, check out the latest Cointelegraph Report on our YouTube channel, and don’t forget to subscribe!  

Fight between crypto and governments “just getting started”, says ShapeShift CEO

Despite the unprecedented regulatory pressure that crypto has been facing recently in the United States, the fight between the American government and the crypto industry has just started, believes ShapeShift CEO Erik Voorhees. 

According to the entrepreneur, U.S. authorities still don’t see crypto as an existential threat to the fiat system, and their recent crackdown is just an opportunistic reaction to last year’s blowups of fraudulent crypto companies. 

“They see it as sort of this scammy area where they can come in and look like the hero for cleaning up a mess,” Voorhees said in an exclusive interview with Cointelegraph.

According to Voorhees, crypto needs to become mainstream before governments move against it fully. At that point, “it will be too late” for government actors to crack down on crypto since too many people will be aware of its value and utility.

Voorhees has no doubt that crypto will ultimately win the battle for the hearts and minds of people in part because it is free from the restrictions on capital flow that are present in traditional finance systems.

“Capital goes where friction is least […]. In the crypto world, capital moves freely, it moves effortlessly,” he pointed out.

Watch the full interview on our YouTube channel and don’t forget to subscribe!

How will the Shanghai upgrade impact ETH price? Expert explains

While it may have some short-term negative impact on the price of Ether (ETH), the upcoming Shanghai upgrade will be extremely bullish for Ethereum’s native token, as it will attract more capital to staking and increase the network’s security, according to Ethereum researcher Vivek Raman. 

The Shanghai upgrade, scheduled for April 12, will allow network validators to withdraw funds that have been locked to secure the network since December 2020. The upgrade will complete the network’s transition to a proof-of-stake system, which started last October with the Merge.

Around 18 million ETH will be available for withdrawal following Shanghai. According to Raman, that may lead to some selling pressure on ETH’s price in the short term.

However, in the long run, the ability to unstake Ether will “de-risk the ETH investment in a tremendous way,” he pointed out. In particular, institutional investors that couldn’t get involved earlier in staking will feel more comfortable once ETH can be unstaked. More capital entering ETH staking will improve the Ethereum network in the long run.

“The more native proof-of-stake asset that’s staked, the higher the cost to attack the chain,” Raman pointed out.

To find out more about the implications of the upcoming Ethereum upgrade, check out the full interview on our YouTube channel and don’t forget to subscribe!

Magazine: ‘Account abstraction’ supercharges Ethereum wallets: Dummies guide

Banking crisis could spark the first ‘extended duration Bitcoin bull market,’ says Swan Bitcoin CEO

The latest banking crisis could lead to “the first-ever extended duration bull market” for Bitcoin (BTC), according to Swan Bitcoin CEO Cory Klippsten.

In an interview with Cointelegraph, Klippsten pointed out that far more people today know about Bitcoin as a tool to opt out of the traditional financial system than during the previous banking crisis, which engulfed Cyprus in 2013. 

That means the next Bitcoin bull could potentially last for two to three years, instead of just a few months, thinks Klippsten. 

According to Klippsten, Bitcoin is not threatened by the current regulatory crackdown in the United States, which he sees as a natural backlash after last year’s FTX collapse. The Bitcoin maximalist supports the Securities and Exchange Commission’s view on altcoins — that they should be regulated as securities. “To want to have security regulation for thee, but not for me, which is what the altcoin industry wants, [..] I think it is just hypocritical,” he said.

Klippsten welcomed the latest Commodity Futures Trading Commission’s lawsuit against Binance, which he sees as a net positive for Bitcoin. According to Klippsten, centralized exchanges like Binance have been slowing down the adoption of Bitcoin by promoting altcoins, which he sees as mainly “pump and dump schemes.”

“The primary marketing activity of Coinbase and of Binance is to market altcoins […] Altcoins in particular since 2017 have siphoned away demand from Bitcoin,” he said.

To learn about a Bitcoin maximalist’s view on the current banking crisis and the U.S. crackdown on crypto, check out the full interview with Klippsten on our YouTube channel, and don’t forget to subscribe!

Bitcoin likely to outperform all crypto assets following banking crisis, analyst explains

The banking crisis could be the spark that will kick off the next crypto bull run, in which Bitcoin (BTC) is likely to outperform all other cryptos, according to Mike McGlone, the senior commodity strategist at Bloomberg Intelligence. 

Following the collapse of major banks such as Silicon Valley Bank and Credit Suisse, confidence in traditional financial institutions is being shaken and Bitcoin is becoming more attractive as a “hedge against banking risk,” thinks McGlone. 

According to McGlone, the United States Federal Reserve’s unwillingness to ease monetary policy despite the banking crisis is driving the U.S. economy into a recession. 

This macro environment will ultimately favor Bitcoin, which is going to outperform all other cryptocurrencies. 

“The more the Bitcoin can sustain above $25,000, then the more the S&P 500 potentially pressures below 4,000, you’re going to have an indication that Bitcoin is going to take off,” McGlone pointed out. “I think Bitcoin will outperform virtually all cryptos, including Ethereum,” he concluded. 

To find out how the banking meltdown is sparking the next Bitcoin bull market, watch the full interview on our YouTube channel, and don’t forget to subscribe!

Banking crisis: What does it mean for crypto?

Last week’s rapid collapse of Silvergate, Silicon Vallley Bank and Signature Bank have highlighted the fragility of the traditional banking sector while depriving crypto of the main fiat on-ramp points in the U.S. 

Most observers agree that the collapse of SVB, like the one of Silvergate, was largely the result of unfavourable market conditions and poor risk management. 

The shutdown of Signature was more controversial. According to multiple sources, the bank was not facing insolvency and had largely stabilized its capital outflow when U.S. regulators decided take over it last Sunday. Many in the crypto industry saw it as a political decision, aimed at pushing crypto out of the U.S.

Silvergate and Signature were the two main financial institutions providing banking services to crypto companies in the US: following their shutdown, it will be far more challenging for crypto companies to interact with the dollar system.

In the meantime, The collapse of SVB seemed have caused a ripple effect across the global banking sector: Credit Suisse, the second largest Swiss financial institution, is going through a severe crisis which required the Swiss Central Bank to intervene with a $54 billion lifeline. 

If you want to know more about the ongoing banking crisis and how it is affecting cryptocurrencies, check out ourr latest Cointelegraph Report and don’t forget to subscribe to our YouTube channel! 

What does the Silvergate collapse mean for crypto?

The collapse of crypto-friendly bank Silvergate will likley have a significant impact on the crypto ecosystem and its ties with the banking sector in the U.S. 

Earlier this week, the parent company of Silvergate Bank announced plans to wind down operations and liquidate the bank. The announcement came after the crypto-friendly bank had suffered 1$ billion worth of losses in the last quarter of 2022 as a direct consequence of the collapse of crypto exchange FTX, one of Silvergate’s main clients.

Silvergate was one of the very few regulated financial institutions providing banking services to crypto companies and exchanges. Its downfall will likely reinforce U.S. regulators’ arguments that crypto poses a threat to the traditional financial system.

Earlier this year, the U.S. banking regulators had already issued a statement in which they warned banks about the risks of serving crypto-related companies. 

But crypto industry leaders spoke out against this assessement, pointing out that the crash of Silvergate was more a cause of classic banking risk, rather than of its exposure to crypto assets.

As Caitlin Long, CEO & Founder of Custodia Bank explained, if the bank held enough cash in its deposits to meet customers’ withdrawa request, it would have survived the bank run without impairing its capitalization. 

Find out more about the causes and consequences of the Silvergate meltdown, check out our latest Cointelegraph Report and subscribe to our YouTube channel.

Russia-Ukraine war: How both sides of the conflict have used crypto to win

In the Russia-Ukraine war, both sides of the conflict have been leveraging cryptocurrencies to achieve the upper hand. 

Pro-Ukraine causes have collected around $200 million from crypto donations, showing how borderless and uncensorable money could be useful in time of emergency. 

But the Russian side has taken advantage of crypto too: a total of about $5 million was raised by pro-Kremlin groups and propaganda outlets in the course of the invasion, as revealed by a recent Chainalysis report. These entities are small grassroot organizations that have used crypto to bypass western financial sanctions. 

“We’re really looking at individual actors. So somebody who’s on the front, somebody who’s trying to help provide more military resources to the front […] things like bulletproof vests or drones,” explained Andrew Fierman, head of Sanctions Strategy at Chainalysis and one of the authors of the report.

But those numbers don’t take into account ransomware attacks: As shown in Chainalysis data, in the course of 2022, over $450 million were paid to these entities, the majority of which were believed to be based in Russia. Some of them, like the cybercriminal group Conti, have openly supported the Russian government in its war effort.

“When it comes to ransomware payments, a lot of the time bad actors have some sort of political agendas behind what they’re doing,” Fierman pointed out.

To find out more about the impact of crypto in the Ukrainian conflict and how Russia leveraged it to promote its cause, check out the full interview on our YouTube channel and don’t forget to subscribe!