top of page

Bitcoin Resilient Despite DeFi Hack

GB Market Commentary 11/08/2021

by Marcus Sotiriou


The worst ever hack in Decentralised Finance occurred yesterday, where over $600 million was stolen. Also, the Senate approved the US infrastructure bill with no amendments, which would dramatically impact innovation for crypto in the US - so it is now up to the House of Representatives to pass through the proposed legislation. Despite this, Bitcoin continues to show incredible resilience as it is attempting to close the third consecutive day above the 200-day moving average today. The market may be anticipating the House of Representatives to decide to include positive provisions suggested by Senators Wyden, Toomey and Lunis.

Bitcoin price graph - 11th Aug

On-chain metrics show that big money has been buying Bitcoin since May 19th, entities with 10K-100K BTC have added +269,450 to their holdings which is worth $12.1B. These entities have between $450M-$4.5B of their capital allocated to Bitcoin. The 50-day moving average is anticipated to cross the 200-day moving average over the weekend unless there is a significant drop in price beforehand, resulting in a golden cross (opposite of the death cross).


Yesterday, Polynetwork was attacked by a hacker who stole $611 million. Polynetwork is a cross-chain protocol that operates on Ethereum, Binance and Polygon. Some blockchain companies have speculated the cause of the hack. Chinese blockchain security firm, BlockSec, claimed the attack might have been triggered with the leak of private keys or through a bug during Poly’s signing process. Another Chinese security firm called Slowmist obtained information from their Chinese exchange partner Hoo to determine that have the attackers used the privacy token Monero as their original funds. Even with the investment risks that DeFi presents, there is currently $80.25bn of value locked in DeFi smart according to DeFi Pulse, representing a 406 per cent increase since the start of the year.


Cardano finally moves ahead with the Alonzo upgrade rollout as its final ‘Purple’ phase is underway. The Alonzo Purple update means that the Cardano testnet can support smart contracts for the first time. Smart contracts on the Cardano mainnet are targeted for the end of August/early September. After the initial onboarding phase, IOHK (the research company who funds the Cardano ecosystem) will hard fork the network and open the Alonzo Purple testnet to any developer. ADA is up around 20% today in anticipation of the long awaited smart contract integration, which will allow Cardano to directly compete with Ethereum.


The famous boxer Manny Pacquiao has announced that he will be releasing an NFT collection on the Ethernity platform. This comes after Lionel Messi announced last week that he will also be launching an NFT collection, which was mentioned in Monday’s commentary. AXS, which is another NFT related token, has risen to being the 31st biggest cryptocurrency by market capitalisation, since being ranked 235th on May 16th. This parabolic rise has been due to the dramatic increase in revenue in the Axie Infinity game, as it has just reached a milestone of more than $1 billion in total sales. The token reached a high of $77 today, from the low of $2.86 in May.


Interest in the cryptocurrency industry from institutions continues to pick up as the 5th largest bank in the US, PNC, are working with Coinbase on an undisclosed crypto project. A source has claimed that PNC plan to offer crypto investment services to clients. Have been hunting fro someone to lead their digital assets and blockchain strategy with a job description as follows: “The role will work on scaling operations for our Cryptocurrency investment capability as well as managing all operational aspects pertaining to new Cryptocurrency initiatives.” I think in the next 5 years, every bank will be offering some form of cryptocurrency related services. Furthermore, AMC, who are the largest cinema operator in the world, have announced that they are accepting Bitcoin for payment for its movies by 2022. There may not be many people wanting to use Bitcoin for this purpose, but this social proofing for another household name to accept the asset is impactful. Lastly, the car insurance company Metromile announced they have bought $1 million worth of Bitcoin.

Comments


GB_CC_May_Digital Asset Trading_Whiteout
  • LinkedIn
  • Twitter
  • Facebook
  • Instagram
  • YouTube
  • telegram logo

GlobalBlock EU ApS is a company incorporated and registered in accordance with the applicable laws of the Kingdom of Denmark as virtual asset service provider, with registration number (CVR-number) 45126382. GlobalBlock EU ApS is wholly owned by GlobalBlock Ltd., a company registered in England and Wales with registration number 09450626. GlobalBlock EU ApS is not a licensed financial services provider and is not supervised as such by the Danish Financial Supervisory Authority. GlobalBlock EU ApS is supervised with respect to anti money laundering by the Danish Financial Supervisory Authority within the scope of the Danish Act on Prevention of Money Laundering and Terrorist Financing and other legislation stemming thereof.

.
GlobalBlock Europe, UAB is a company incorporated and registered in accordance with the applicable laws of the Republic of Lithuania as a virtual currency depository wallet operator and virtual currency exchange operator, with registration number 306045642. GlobalBlock Europe, UAB is wholly owned by GlobalBlock Ltd., a company registered in England and Wales with registration number 09450626,  GlobalBlock Europe, UAB is not a licensed financial services provider and is not supervised by the Bank of Lithuania. GlobalBlock Europe, UAB is supervised by the Financial Crime Investigation Service under the Ministry of Interior of the Republic of Lithuania within the scope of the Law on Prevention of Money Laundering and Terrorist Financing of the Republic of Lithuania and other legislation stemming thereof.
 
Investors should be aware that cryptocurrencies are volatile investment instruments that carry a high degree of risk to the capital investment. The information in this website is not intended and should not be construed as an offer, solicitation or recommendation to buy or sell any specific investments or participate in any specific investment (or other) strategy. The products and services outlined on this website may not be suitable for all types of investors. The value of an investment can go down as well as up, and you may not get back the amount you originally invested. You should not invest more than you can afford to lose and should ensure that you fully understand the risks involved. Before trading, please take into consideration your level of experience, investment objectives, and seek independent financial advice if necessary. It is your responsibility to ascertain whether you are permitted to use the services of GlobalBlock Europe, UAB based on the legal requirements in your country of residence. The information in this website is for information purposes only and is subject to change. No part of this website can be reproduced without written permission.


 Client fiat is held with GlobalBlock in accounts with BCB Limited,and does not meet the definition of Electronic Money (e-money). Client fiat and cryptocurrency are not “safeguarded” nor covered by any compensation scheme. Clients could potentially lose their cryptocurrency or fiat if something were to happen to GlobalBlock or, BCB.

Cryptoasset Notice

Cryptoasset services are provided by GlobalBlock Europe, UAB (“GlobalBlock”).   Cryptoassets are not regulated in any jurisdiction and the value of your assets can increase or decrease. You should note that your cryptoasset profits may be subject to Capital Gains Tax.

The service you obtain through the website or the app in the UK, contains cryptoasrvices not regulated by the Financial Conduct Authority. Please be aware that:

  • You will have no recourse to the Financial Ombudsman Service in the event of a complaint relating to cryptoasset services.

  • Your cryptoasset account is not protected by the Financial Services Compensation Scheme.

  • Cryptoassets may experience frequent price volatility resulting in a high degree of risk.

bottom of page