Cryptocurrency

Bitcoin: While everyone is discussing the Tesla sale, the onchain data is worrisome

Published

4 weeks ago

July 23, 2022

Bitcoin pulled back from Wednesday’s highs, losing all of its gains for the day and closing in the red zone. Today, the BTCUSD quotes remain under pressure, but until the support level of 21,900 is broken, it all looks like a pullback and may well end with confirming the indicated horizon as support followed by a rebound up.

An alternative scenario for the main cryptocurrency would be a return to the sideways 18,900 – 21,900 level, and then there is little to keep the price from falling. Meanwhile, the cryptocommunity is actively discussing the news of the day that Tesla sold its bitcoins, which probably caused yesterday’s drop.

Why Tesla sold Bitcoin

During Tesla’s quarterly report, it was revealed that the electric car company sold almost all of its BTC reserves, having only 25% of the bitcoins acquired during the 2021 bull market.

Tesla converted most of its bitcoin assets into fiat currency, earning about $936 million, which showed up on its balance sheet as “proceeds from the sale of digital assets.” The electric car maker now owns about $218 million in BTC.

Tesla CEO Elon Musk explained that the sale was not a “verdict on bitcoin.” It was a forced move because of liquidity problems. Also, parts shortages and delivery failures also led to further delays in production and deliveries. Musk also said that the company would be open to increasing its bitcoin assets in the future.

Tesla’s CFO explained the sale of BTC

Tesla CFO Zachary Kirkhorn said the sale was for “realized gains.” This means that the company sold the cryptocurrency at a higher price than it bought it.

However, he also pointed out that the bitcoins left on the balance sheet were worth far less than their purchase price, indicating that the drop in cryptocurrency prices was significant enough to offset the gain from the sale in the second quarter of 2022. Kirkhorn said the actual net result was $106 million for the company’s balance sheet.

Because Tesla’s brand is focused on sustainability, the high energy consumption of bitcoin mining was an issue. The CEO also explained that Tesla would reconsider opening this payment method if Bitcoin could move to a more sustainable energy model.

Bitcoin whale are selling Bitcoin

Miners also appear to have taken advantage of the recent upward price movement to make some profits. The balance of bitcoins held on trading platforms also shows a surge in inflows since July 12. The number of new daily addresses created on the network is decreasing. This indicates a lack of interest in bitcoins among outside investors at current price levels.

Increased open interest coupled with declining network growth and increasing selling pressure from whales and miners suggests that the recent upward price movement that Bitcoin has shown is due to leverage. These network dynamics increase the likelihood of a steep correction.

Around 630,000 addresses previously bought 524,000 BTC worth between $20,220 and $20,900. This demand zone must be maintained in the event of a downturn to prevent excessive losses. If the major cryptocurrency fails to hold that level, a sell-off could send it to around $16,000.

Bitcoin would probably need to close the daily candle above $23,660 to be able to rise higher. Breaking this important barrier of resistance could help BTC rise to $25,000 or even $27,000. However, as long as whales and miners continue to sell and the growth of the network slows, the threat of a steep correction remains.

Cryptocurrency

Sanctions against Tornado Cash boosted TORN token trading volumes

Published

2 days ago

August 16, 2022

letizo News

Tornado cash (TORN) token trading volumes jumped sixfold amid the announcement of sanctions against the mixer. This was pointed out by Kaiko analysts in their newsletter. TORN’s trading volume rose from less than $5 million to $60 million on the cryptocurrency exchange Binance. The growth in trading volume was also recorded on OKEx, but there the figures were significantly lower. Tornado cash sanctions are to blame.

At Binance, tornado cash sold out. According to Kaiko, several decentralized exchanges (including Uniswap, dYdX, and Aave) imposed restrictions on wallets contacting the Tornado Cash mixer. Whether this was the reason for the increase in liquidity is unclear.

However, the increase in trading volume seems to have led to heavy selling of TORN. As the volume of capital on the centralized exchanges increased, TORN quotations fell faster and faster. Now, TORN in the TORN/USDT pair is trading at $12.7, according to Nomics. Over the past seven days, the price of TORN has fallen by more than 23%. Market capitalization collapsed to $19.3 million.

Recall that in early August, the U.S. Treasury Department’s Office of Foreign Assets Control imposed sanctions on the Tornado Cash mixer. The regulator estimated that the platform had helped launder more than $7 billion in assets since its launch in 2019.

Shortly after the sanctions were announced, Circle, the issuer of one of the most capitalized Stablecoins, USD Coin (USDC), froze 75,000 USDC of the cryptomixer’s users and 149 USDC that the project received in donations. Analysts at The Block Research found that transfers to the platform were down 78.5 percent compared to the period before the announcement of sanctions against Tornado Cash.

We previously reported that S&P Global downgraded Coinbase to speculative.

Cryptocurrency

Eqonex news: High competition buried public crypto exchange Eqonex

Published

2 days ago

August 16, 2022

letizo News

Eqonex news: public U.S. crypto exchange Eqonex (EQOS) will close its services to customers on August 22 due to high market competition and a decline in trading volume. The exchange announced this on its official website.

The company will close its trading functionality at the end of August and will phase out cryptocurrency withdrawals on September 14. Also, Eqonex will stop trading the native token EQO, whose trading volume over the past month only occasionally and briefly, exceeded the threshold of $10,000.

The company will not close, but will continue to provide capital management and custody services for cryptocurrencies in the form of a custodian.

According to Eqonex CEO Jonathan Farnell, closing the exchange will improve Eqonex’s financial position by significantly reducing its cost structure and freeing up resources to spur growth in segments where the company has a “significant competitive advantage.” At the time of writing, the market has not reacted to the news of Eqonex’s closure.

In July, many cryptocurrency exchanges saw a decline in trading activity. The strongest decline in trading volume was seen on exchanges such as LBank (by more than 50%), Huobi (by 31.3%) and Gate (by 31.2%). crypto.com and Bitfinex saw trading volume drop by 25%.

On the other hand, some exchanges saw a significant increase in spot trading volume in July. Binance US increased by 76.7%; OKX by 30%, and Phemex by 227.4%. Bitmart and Binance grew by 18% and 9.3%, respectively.

We previously reported that Investors Asked Asian Crypto Exchange’s CEO To Step Down.

Cryptocurrency

Bitcoin plummets as miners sell inventory? Miners continue to sell bitcoin, albeit in smaller volumes

Published

2 days ago

August 16, 2022

letizo News

bitcoin plummets as miners sell inventory

Despite lower market volatility, miners are still dumping bitcoin. Because of this, bitcoin also plummets as miners sell inventory. This was reported in a report by Arcane analysts. According to published data, in July, miners poured 6200 BTC (~$149 million at the current exchange rate). By comparison, miners sold out about 15,000 BTC in June.

However, even though the scale is down, July was still the second highest month since the beginning of 2022 for bitcoin sales by miners. Arcane analyst Jaran Mellerud claims that public miners sold 158% of the cryptocurrency mined during July. This is the third month in a row that miners have sold all the cryptocurrency (and even more) than they manage to mine in a month. It was also previously reported that bitcoin miners sell off because of unprofitable mining.

Arcane named mining companies Core Scientific and Bitfarms as the main culprits of the dump. This, according to Mellerud, is because the companies took out too many loans to grow their businesses. In addition to them, bitcoin was also sold at Nothern Data, Argo, and CleanSpark.

Recall that in mid-June the co-founder of the mining firm Luxor Technologies Ethan Vera said that many lenders (Bable Finance, Galaxy Digital, bankrupt Celsius Network, BlockFi, Foundry Networks) are concerned that they have made too many loans to secure the mining devices themselves. He estimates that the firms have made a combined $4 billion in loans.

Luka Jankovic, head of credit at Galaxy Digital, noted at the time that at June bitcoin rates (at or below $20,000), many mining centers were operating at a loss.

We previously reported that BitGo declined to buy the cryptocurrency depository.