Bitcoin supply squeeze heats up as Grayscale buys nearly 3x the BTC mined in December

Institutional crypto investment giant Grayscale now has $20 billion under its control as its Bitcoin (BTC) buys outstrip production by almost three to one.

As noted by data analysis resource Coin98 Analytics on Jan. 1, Grayscale bought almost three times more BTC than that which was added to the market in December 2020.

It’s official: Miners can’t produce enough Bitcoin

Last month, the company added a total of 72,950 BTC ($2.132 billion) to its assets under management (AUM). During the same period, miners generated just 28,112 BTC ($821.7 million) — 38.5% of Grayscale’s buy-in.

The figures underscore what many have described as an ongoing liquidity squeeze in Bitcoin, where large buyers suck up any available supply and remove it from circulation, sending it to cold storage for long-term hodling.

As Cointelegraph reported, the phenomenon was already visible in November, but December saw a clear increase in demand from Grayscale and other institutional entities.

BTC mined vs. bought by Grayscale in December 2020. Source: Coin98 Analytics/ Twitter

Grayscale now controls $20 billion in crypto

As the clock chimed midnight on New Year’s Eve, meanwhile, Grayscale CEO Barry Silbert celebrated bringing the company’s total AUM across its various crypto funds to over $20 billion. Just one year ago, the figure stood at a mere $2 billion.

Grayscale crypto assets under management as of Dec. 31, 2020. Source: Grayscale/ Twitter

The company remains the largest institutional player on the Bitcoin scene, with its $17.475 billion in BTC far outstripping any other market participant. Newcomer MicroStrategy, while not an investment business, now controls 70,470 BTC ($2.06 billion).

Going forward, analysts predict that more demand for the fixed supply of “new” bitcoins from miners will only serve to create a bidding war and push up the price. Sellers already faced stiff resolve from buyers in December, when new all-time highs failed to produce significant long-lasting pullbacks.

At press time on Friday, BTC/USD continued to trade above $29,000, having hit a new record high of $29,500 overnight.

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What Are Ripple’s Chances of Beating The SEC in Court?

Just weeks ago, XRP was outperforming Bitcoin, and everything Ripple related was coming up roses. However, less than 10 days ago, all of that came crashing to an abrupt end.

It emerged that the U.S. Securities and Exchange Commission (SEC) was building a case against Ripple, and its two most senior executives, over securities fraud.

“The complaint alleges that Ripple raised funds, beginning in 2013, through the sale of digital assets known as XRP in an unregistered securities offering to investors in the U.S. and worldwide. Ripple also allegedly distributed billions of XRP in exchange for non-cash consideration, such as labor and market-making services.”

The news shocked the cryptocurrency world. More so, the timing of the announcement, in that the SEC leadership has just weeks left before leaving office, with the rest of the Trump administration.

The XRP price suffered tremendously. From its mid-November year to date high of just under $0.80, XRP has plummeted as low as $0.1686 at one point. This represents a 79% drop.

Today sees some semblance of a fightback, with the price up 2% in the last 24-hours to $0.2198 at the time of writing.

Source: XRPUSDT on TradingView.com

XRP Exchange Exodus Accelerates

Each passing day sees another crypto exchange either suspend or removed XRP trading altogether. Yesterday was the turn of Binance U.S., who elected to delist XRP with effect from January 13, 2021.

According to crypto researcher Larry Cermak, that leaves Kraken as the only big exchange serving U.S. users wishing to trade XRP. However, Cermak is of the view that Kraken will fall in line with the others soon.

Kraken is now officially the last major exchange serving U.S. customers that hasn’t yet delisted XRP. Coinbase, Bitstamp, Bittrex, Binance US, FTX US all delisted already. Announcement must be imminent.

— Larry Cermak (@lawmaster) December 30, 2020

The latest development sees a pre-trial conference set for February 2021, in which all parties have the opportunity to discuss the path forward.

While Garlinghouse has been silent on the matter since Christmas Eve, it looks as though this case will go all the way to court.

What’s particularly worrying for XRP holders is that the SEC has rarely lost a court case. And never one involving cryptocurrency security tokens.

The SEC’s Has a Strong Track Record

To determine what could happen to Ripple requires looking at past cryptocurrency-related run-ins with the SEC.

YouTuber Ben Armstrong, also known as BitBoy Crypto, posted a video on just that. In it, he refers to cases involving Tezos, EOS, Telegram, and Kik.

In the case of Tezos and EOS, Armstrong pointed out that both companies caved in and paid their respective settlements. Meaning neither firm went as far as going to court.

Whereas Telegram and Kik opted to challenge the SEC.

The outcome for Telegram saw the court side with the SEC, resulting in a civil penalty of $18.5 million and the return of $1.2 billion to investors on the sale of unregistered Gram tokens.

In the case of Kik, the court also sided with the SEC over charges of illegally selling its unregistered Kin tokens. A $5 million penalty was levied against the firm.

As such, while Garlinghouse says, “we are not only on the right side of the law, but we will be on the right side of history,” the truth of the matter is that the SEC has a strong track record.

With that, the odds are stacked heavily against Ripple.

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Bitcoin price faces the last roadblock before $30,000

The price of Bitcoin (BTC) has reached a new all-time high above $29,400 across major exchanges on Jan. 1. In other words, BTC is just 2% away from reaching the psychological resistance level at $30,000.

Breaking $30,000 could fuel renewed confidence in the market with the last remaining technical roadblock right below this level. 

BTC/USDT 4-hour price chart (Binance). Source: TradingView.com

Hence, in the near term, sellers would look to defend the $30,000 resistance level with stacked sell orders. Exchange order books show large sell orders in the $29,800 to $30,000 range.

$29,800 is critical for another leg up for Bitcoin

Binance order book heatmap. Source Material Indicators

Exchange order books on both Binance and Bitfinex show relatively large sell orders from $29,800 to $30,000. This means that sellers would attempt to lead a Bitcoin pullback before it reaches $29,800.

A pseudonymous cryptocurrency trader known as “Loma” similarly said that if Bitcoin was to reject at $30,000, it would likely drop from $29,800. He said:

“BTC either blows through $30,000 over the next few days into the $31-33k territory or we front-run and reject at like $29,800. Basically what I’m saying is, if you’re shorting $30k, there’s a very good chance you’re going to be ran over.”

Traders in the Bitcoin futures market have been trying the suppress the price of BTC and have shorted aggressively in the past 24 hours.

The futures funding rate on Coinbase and other major exchanges have remained at around 0.01%, despite the recent rally. At times, it fell below 0.01%, indicating that the majority of the market was short or selling BTC.

That funding rate is a New Year gift I be leave $BTC #Bitcoin pic.twitter.com/GSPCDnZuKu

— Coinalyze (@coinalyzetool) December 31, 2020

However, retail investors in the Bitcoin spot market, which refers to exchanges without derivatives and leverage, have been accumulating BTC.

On December 31, shortly before the New Year, the price of Bitcoin rallied to a new all-time high. Analysts at Santiment said that they spotted an increase in on-chain movements, which might indicate retail accumulation.

Since Coinbase saw a large premium over other major exchanges, like Binance, retail investors on Coinbase likely bought Bitcoin entering into the New Year. The analysts said:

“As #Bitcoin’s markets opened on 2021 for the first time about 30 minutes ago (UTC), prices have jumped to $29,460 as $BTC has made yet another AllTimeHigh. Active addresses are on the rise in recent hours to support this push.”

In the near term, Bitcoin would likely see a battle between futures short-sellers and retail investors in the spot market as the price reaches closer to $30,000.

Bitcoin reaches all-time high on Jan. 1. Source: Santiment

What happens next?

In the near term, the key is to see Bitcoin’s behavior at $29,800. There is a strong possibility that it pulls back without surging to that level, which could lead to a decent-size correction.

If BTC surges past $29,800 without much difficulty, then a broader rally above $30,000 becomes probable in the foreseeable future.

As Cointelegraph reported earlier this week, Bitcoin will look to extend its gains in the first quarter of 2021, several metrics suggest. 

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SushiSwap (SUSHI) Undergoes 10% Rally Despite Ethereum Drop

SushiSwap’s native token, SUSHI, has undergone a strong rally over the past 24 hours. The leading cryptocurrency is up 10% in the past 24 hours, pushing to multi-week highs after a few days of slow price action.

SUSHI’s rally comes as Bitcoin has thrust higher, pushing to new all-time highs at $29,500. The leading cryptocurrency currently trades for $29,000 after a slight correction.

The rally in the Ethereum-based coin of SushiSwap is taking place as ETH corrects. Ethereum is down 1.5% in the past 24 hours, which would often mean that altcoins underperform.

Related Reading: Wall Street Veteran Kickstarts Own Bitcoin Fund With $25m Investment

SUSHI Rallies With Other DeFi Coins

SushiSwap’s rally over the past 24 hours to 48 hours comes as the DeFi market has finally mounted some sort of recovery.

Many top decentralized finance coins, such as UNI and YFI, have faced strong corrections over recent weeks. While Ethereum has been rallying, most attention has been focused on Bitcoin and smaller altcoin groups. This has resulted in capital outflows from these altcoins into BTC and these other more niche markets.

DeFi is finally rallying, though, as Bitcoin’s momentum may be slowing.

SUSHI is one of the top-performing crypto assets of the past 24 hours. It is the best-performing DeFi large cap of the past day aside from THORChain’s RUNE, which has gained 15% in the past 24 hours.

Related Reading: DeFi Founder Targeted in $8m Hack Says He Has His Hacker’s IP

Strong Fundamental Trends

SUSHI’s rally comes on the back of strong fundamental trends for the SushiSwap platform itself. Andre Cronje, founder of Yearn.finance, said on SushiSwap and SUSHI when he announced a partnership between the protocol he founded and the exchange:

“I had been outspoken in the past about the things that Sushiswap did wrong, but I cannot overstate how much they have done right. In the past weeks of interacting with 0xMaki I have developed immense respect for their character, their capabilities, and their execution. Boring, has given me a similar experience, and shown me to be an incredibly strong, motivated, and talented developer, quickly catching mistakes that I did not notice. These two alone would be invaluable to have along for our mutual journey, yet the Sushiswap team is so much more and they will continue to grow.”

Developers are expected to soon roll out a new platform called BentoBox.

This BentoBox solution will be an on-chain lending solution that will enable margin trading for the long-tail of assets on Ethereum. SUSHI is expected to accrue value from this launch as stakers of the coin should earn more.

Related Reading: 3 Bitcoin On-Chain Trends Show a Macro Bull Market Is Brewing

Featured Image from Unsplash
Chart from TradingView.com
Price Tags: SUSHIUSD, SUSHIBTC, SUSHI
SushiSwap (SUSHI) Undergoes 10% Rally Despite Ethereum Drop

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Top Stories of 2020, #1: The Impact of Coronavirus

YFDAI Finance on Path to Push DeFi to the Limit, Starting with SafeSwap and Launchpad

Emerging decentralized finance (DeFi) ecosystem, YFDAI Finance, announces the launch of two new services – SafeSwap and Launchpad, both key moves in the promotion of mass growth and adoption of DeFi services.

DeFi is becoming the “next big thing,” in which cryptocurrencies and their underlying blockchain technology deploy for new uses and a widening user-base.  Among DeFi’s main selling points is the promise of better alternatives to what is offered in the traditional banking sector, in many cases at a fraction of the cost.  Additional advantages include ultra-low barriers to otherwise excluded financial service clients and better investment opportunities with attractive returns in comparison to conventional instruments. All of these aspects of DeFi will exist in a context of enhanced transparency, security, and user control over their funds.

SafeSwap is YFDAI’s decentralized exchange (DEX), created by a fork of the popular Uniswap platform. This DEX enables select crypto projects to list their tokens, provided they meet strict listing criteria designed to protect token investors and issuers alike. A listing on SafeSwap allows budding DeFi and crypto projects to drive widespread adoption and secure much-needed liquidity.  To avoid issues arising currently from a more active regulatory environment, SafeSwap’s choices as to many operating aspects will very soon be subject to community governance.

Meanwhile, the YFDAI Launchpad brings new crypto projects to market, providing them guidance and development services from our partners Foundry Incubator, Ferrum Network, Blockchain Consilium, among others. Providing the necessary support to develop projects, YFDAI Launchpad assists their crowd-based fundraising, in partnership with DuckDAO decentralized fundraisers. Participating startups in the Launchpad program will have locked smart contracts created for Uniswap as well as SafeSwap exchanges.

What is YFDAI Finance?

YFDAI Finance is a DeFi ecosystem focused on four key values: accessibility, security, intuitive governance, and trustless protocol.  With YFDAI, users anywhere can access DeFi solutions a whole suite of DeFi services including farming, lending, borrowing and staking.

Why YFDAI?

DeFi has been in existence for a few years, but there have been many instances of projects that have failed to deliver on their promises, due to design flaws, bad decisions, and questionable practices. These failures have led to much hesitation in the wide adoption of DeFi.  But in spite of the several setbacks, the sector is here to stay, offering compelling value and utility.  And YFDAI will lead the way, making it safe and easy for an ever-expanding set of users.  Few projects like YFDAI have come forward to improve on existing DeFi business models, and to work tirelessly to reduce, if not completely eliminate, the fear surrounding DeFi solutions.

Apart from DeFi solutions, YFDAI Finance has plans to offer a host of crypto products and services, including an e-commerce platform, debit Cards, a centralized exchange, fiat-to-crypto on- and off- ramps, and trading bots.

To promote trust in our platforms, YFDAI has adopted the highest levels of transparency and security. It has also entered into a collaboration with various leading names in the crypto sector, such as the Crypto Investor’s Protection Alliance (C.I.P.A), DuckDAO, Ferrum Network and the Foundry to ensure that its vision for the future of DeFi becomes a reality.

Learn more about YFDAI Finance at – https://yfdai.finance/

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Best Ways to Buy Bitcoin on Crypto.com

As Bitcoin continues to break new barriers to redefine its all-time-high prices, the flagship cryptocurrency has become one of the most sought-after instruments among individuals and corporates alike. In the present scenario, Crypto.com offers a variety of options for users to invest in the digital gold and benefit from the potential riches Bitcoin can bring to them.

Crypto.com is one of the leading cryptocurrency platforms whose products include multi-currency wallet, exchange platform, spot and margin trading, liquidity mining and more. Investing in Bitcoin on the Crypto.com app is easy as well as flexible process, designed particularly to suit the needs of different types of investor preferences.

Here are some of the methods to acquire Bitcoin this new year on Crypto.com

Buy Crypto

The quickest method to purchase Bitcoin or any other cryptocurrency on the app is to go to the “Buy” section by tapping on the Crypto.com logo. Users can choose Bitcoin from the extensive list of available cryptocurrencies; enter the amount they wish to purchase and make payment. They can complete the purchase by either paying through their credit cards, altcoins stored in the Crypto.com wallet or through the in-app wire transfer funded fiat wallet.

Once the purchase is completed, the amount of BTC purchased will be available in Crypto.com’s BTC wallet, for use or to hold until the asset’s price hits the moon.

Recurring Buy

Those wishing to gradually bolster their BTC portfolio, without spending a lot at one go can opt for the “Recurring Buy” option. It provides a convenient way to acquire crypto assets at desired frequency, without having to manually complete the transaction each time. The “Recurring Buy” option automates BTC purchases for as low as $50 on the Crypto.com app on a weekly, bi-weekly or monthly basis.

In addition to convenient purchases, opting for Recurring Buy also helps users reduce the impact of volatility on the overall purchase of Bitcoin (or other cryptocurrencies) by dividing up the total amount to be invested across periodic purchases.

Crypto Earn

The Crypto Earn feature on Crypto.com allows users to stake their Bitcoin on the platform for a certain period of time and earn returns on it. With flexible, one month, and three-month staking options available, the deposited cryptocurrency will accrue interest daily which will be deposited into the user’s BTC wallet at every 7-day intervals as earnings.

Depending on the cryptocurrency and staking duration, users can potentially earn up to 12% interest per year on Crypto.com’s Crypto Earn feature.

Supercharger Listing

Recently Crypto.com included Bitcoin rewards to its Supercharger program where users could deposit Crypto.com’s native CRO tokens into the Supercharger pool for any preferred duration within the 30-day time period, known as the Charging Period. Once the Charging Period is over, depending on the liquidity provided by a user during that phase, they stand to receive reward tokens in BTC every day for the next 30 days aptly known as the Reward Period. However, with the Charging Period now over those who participated in the Supercharger will now start receiving BTC rewards.

Earlier this year, Crypto.com organized a Syndicate BTC Special Event to mark the official exit of its exchange platform from public beta. As a part of the program, those who staked CRO tokens on the exchange had $2 million worth of BTC allocated to them for purchase at a 50% discount. The amount of BTC made available at the discounted price was proportional to their CRO contribution.

This is not the end of it, as Crypto.com will continue to offer attractive ways to invest in different cryptocurrencies.

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