top of page

Ethereum Scaling Solutions Thrive

Updated: Oct 29, 2021

GB Market Commentary 14/09/2021

by Marcus Sotiriou


Yesterday was a volatile day for Bitcoin and the crypto markets. After Bitcoin had dropped almost 5% in the first half of the day, news of Walmart accepting Litecoin for payments was reported on Reuters, Bloomberg News and CNBC. Litecoin and the whole market saw a great rally for 15 minutes before Litecoin and Walmart confirmed that this news was fake, causing Bitcoin to retrace back down. Since yesterday’s lows of $43,300 approximately, Bitcoin has recovered to the high $45,000 region, as a 4-hour bullish divergence on the RSI indicator has been confirmed, indicating short term continuation to the upside. The crypto markets have shifted into a range-bound environment since the crash last week, between $43,000 and $47,000, with neither bulls or bears having a firm grip.


On-chain metrics continue to show whale accumulation, as supply distribution (shown above) shows whales have added recently. Whale holdings have increased by roughly 44,000 BTC ($2bn) in the past week, and 103,600 BTC ($5bn) in the past 3 weeks. Yesterday MicroStrategy announced their purchase of 5,050 BTC at an average of $48,099, leaving the remaining buyers of the 98,000 BTC unknown. This means we may see a flood of institutional BTC purchase announcements over the coming weeks or months.

Bitcoin Supply Distribution by Participants

Despite bullish on-chain data, the overall sentiment in the market has turned negative, with the fear and greed index at fear levels. This could be in part due to regulatory concerns. Commentary from Gary Gensler, the SEC chairman, to the US Senate was released yesterday, which indicated that Gensler will be targeting stable coins and that the SEC believe that the majority of tokens listed on major crypto exchanges at the current time are in fact securities and should be treated as such. The Litecoin fiasco yesterday was a poor look for the industry and could be used as ammunition if the SEC go after crypto exchanges. In summary, this news of stringent regulatory action brings short term risk to the industry.


Adoption from major financial institutions continues as EY partners with Polygon in order to action Ethereum’s blockchain utilities, further proving the longevity of the crypto space. EY claim that this move will raise transaction volume, deliver predictable costs and fix troubles for corporate prospects. Other layer 2 scaling solutions for Ethereum have seen tremendous progress recently - in particular Arbitrum and Optimism. Arbitrum had a TVL (total value locked) of around $170m on Friday. After the weekend though, this raised to a staggering $1.6bn, as yield farms for speculative tokens launched. Activity for Optimism grew significantly over the weekend also, with over 9,000 unique depositors, from below 1,000.


Lastly, it was announced over the weekend that Coinbase will use XRP for remittance services. Coinbase has a new page where users will be able to send money to other Coinbase accounts using XRP or USDC. This news of Coinbase integrating XRP suggests that they are not worried at all about Ripple’s SEC lawsuit. Many are speculating that Coinbase is getting ready to list XRP soon as the trading tab for XRP is now in place. Ripple has continued business internationally throughout the lawsuit, as Ripple’s on-demand liquidity recently went live in Japan, with SBI remit – the largest money transfer provider in Japan. Ripple do not seem worried at all about the lawsuit, which I think for good reason. A settlement looks like it may be on the cards soon, as former SEC director Hinman recently admitted the SEC never warned Ripple of XRP being a security, after saying they did in his deposition.

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 Holdings., a company registered in England and Wales with registration number 15929099 . 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 Holdings Ltd., a company registered in England and Wales with registration number 15929099,  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