Day: March 29, 2024

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BNB experienced a notable 12% rise in value over the past week, reaching a nearly two-week high of $620 by March 29. This surge, while impressive, prompts speculation about whether BNB has hit its peak or if it’s poised for further growth. Compared to its competitor Ether, which saw a 5% increase over the same period, BNB’s surge narrowed the valuation gap between the two. However, insights from on-chain BNB Chain data suggest that the recent rally might have pushed the limits too far.

Factors Influencing BNB’s Price

Market analysts observe a correlation between the crypto market’s upward trajectory and inflows into spot Bitcoin exchange-traded funds (ETFs). However, the week ending March 23 marked a setback as these ETFs experienced a net outflow of $890 million for the first time since their introduction in January. Despite this, recent data indicates a reduction in outflows from the Grayscale GBTC fund, with only $104 million exiting the fund by March 28.

In early March, BNB’s price surged by 61.7%, reaching a peak of $645 and a market capitalization of $96.4 billion. Yet, momentum slowed afterward. For context, BNB reached an all-time high valuation of $116 billion in November 2021. Notably, the total value locked (TVL) on BNB Chain, representing deposits in the network’s smart contracts, peaked at $15.7 billion but has since fallen to $7.1 billion, marking a 55% decrease.

Contextualizing BNB Chain’s Performance

Considering the overall decline in the crypto market, particularly in decentralized finance (DeFi) since late 2021, it’s important to contextualize BNB Chain’s TVL decline. The total market data for all tracked blockchains has decreased from nearly $205 billion to $155 billion, indicating a 25% drop. Hence, a thorough analysis of BNB Chain’s TVL, especially concerning competitors like Ethereum and Solana, is necessary.

Activity on BNB Chain

TVL isn’t the sole indicator of a blockchain’s success. Numerous decentralized applications (DApps) on the BNB Chain, spanning nonfungible token (NFT) marketplaces, gaming platforms, decentralized betting systems, collectible platforms, and social networks, operate without necessitating significant deposits. In the past week, nearly 2 million active addresses engaged with DApps on the BNB Chain, showcasing significant activity levels comparable to Ethereum’s most active layer-2 networks.

Forecasting Future Trends

Predicting cryptocurrency trends is challenging, but examining derivative metrics such as the demand for leverage in BNB perpetual futures contracts provides insights into market sentiment. While the demand for leveraged long positions has stabilized, with the 8-hour funding rate holding around 0.03%, optimism remains despite BNB’s price struggle with the $620 level. Typically, a positive funding rate above 1.2% per week indicates bullish market sentiment.

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On Thursday, the price of Dogecoin (DOGE) soared to its peak since December 2021, hitting 22 cents. This surge was fueled by heightened trading volumes and speculation regarding its potential integration into the social media platform X, owned by Elon Musk. Various posts from prominent members of the Dogecoin community on X speculated about the token’s potential adoption on the platform, especially considering a new payment branch acquiring additional licenses in the United States. This speculation contributed to bullish sentiment and trading interest in DOGE.

The token’s price tends to react to developments related to payments at companies owned by Elon Musk, such as X or Tesla. Elon Musk’s previous endorsements of Dogecoin have also influenced its price movements.

Trading volume for DOGE surged to $7 billion in the past 24 hours, up from an average of $3 billion earlier in the week. Futures tracking the token also saw open interest rise to nearly $2 billion across crypto exchanges, indicating increased bets on price volatility.

While speculation about DOGE’s usage on X has been ongoing since Musk acquired the company in 2021, there has been no official confirmation regarding whether DOGE will be accepted as a payment option on the platform. However, Musk’s previous statements and endorsements have fueled speculation about the potential integration of DOGE into X’s payment services.

Overall, the surge in DOGE’s price and trading activity reflects the continued influence of social media speculation and Elon Musk’s involvement in the token’s market dynamics.

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During a panel discussion at the recent BUIDL Asia summit in Seoul, the issue of racist meme coins and how to handle them was debated among panelists. These meme coins, containing offensive terms and themes, have become increasingly prevalent in the crypto space in recent months, raising concerns within the community.

Austin Federa, the head of strategy at the Solana Foundation, offered his perspective on the matter. He argued that while users should have the ability to reveal content if they choose to, the core network should remain permissionless. Federa likened the situation to the internet, where it’s impractical to expect internet service providers (ISPs) to filter out offensive content. Similarly, in the crypto space, wallet developers can implement block lists to filter out certain tokens, but the core network should remain decentralized and permissionless.

On the other hand, Marc Zeller, founder of the Aave Chan Initiative, highlighted the legal obligations in some jurisdictions, such as France, where ISPs are required to block certain content. Zeller acknowledged the cultural differences in approaches to censorship and emphasized the importance of censorship resistance in the blockchain ethos.

Federa also mentioned the legal obligations faced by validators and nodes, citing instances where the U.S. Office of Foreign Assets Control (OFAC) imposed sanctions on certain crypto transactions. However, he noted that addressing racist meme coins should be kept in perspective, as they represent a small fraction of the overall crypto market.

In summary, while there are differing views on how to address offensive meme coins, the discussion at the BUIDL Asia summit highlighted the complexities involved and the importance of balancing censorship resistance with legal obligations and community standards.

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Google has introduced new functionality allowing users to search blockchain data on various networks, including Bitcoin, Arbitrum, Avalanche, Optimism, Polygon, and Fantom. This expansion enables users to search for wallet addresses and view their balances directly within Google search results.

When users type in wallet addresses, Google displays the remaining token balance in the wallet for each supported network, along with the timestamp indicating the last time the balance was updated. It’s important to note that balances only show the native token for each network, and the displayed balance reflects the state of the wallet as of the last external transaction. Updates to balances are not instantaneous.

This recent update builds upon Google’s previous support for Ethereum wallet balance searches, which began last May. Initially, Google enabled users to search for specific public addresses on the Ethereum network and view the wallet balance directly in the search results. Additionally, earlier this month, Google started showing search results for wallet balances when users searched for Ethereum Name Service (ENS) domains. ENS provides readable domain names for Ethereum wallet addresses, facilitating easier identification and navigation within the Ethereum ecosystem.

Google’s expansion of wallet address search functionality reflects the growing interest in blockchain technology and cryptocurrencies. By providing users with easy access to blockchain data directly through its search engine, Google is helping to enhance accessibility and transparency within the crypto space.

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Taiwan’s Ministry of the Interior has approved the establishment of a cryptocurrency industry association, marking a significant step toward regulating the burgeoning sector.

The local cryptocurrency industry working group, which was formed last year to pave the way for the creation of the association, announced on Friday that it had received government approval for its application.

The working group is now tasked with finalizing all necessary preparations and officially establishing the cryptocurrency industry association by the end of June, as stipulated by government regulations.

Comprising 22 cryptocurrency firms, including prominent exchanges like MaiCoin and BitoPro, the working group has excluded ACE Exchange from its ranks due to ongoing investigations into alleged misconduct by its former executives.

Moving Towards Self-Regulation

While Taiwan currently mandates that cryptocurrency service providers adhere to anti-money laundering laws introduced by the Financial Supervisory Commission in July 2021, the sector largely operates without comprehensive regulation.

In September 2023, the FSC issued guidelines prioritizing customer protection for cryptocurrency firms. With the formation of an industry association, these firms aim to develop self-regulatory measures aligned with the FSC’s guidelines.

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Spot Bitcoin exchange-traded funds (ETFs) in the United States experienced net inflows for the fourth consecutive day, concluding the month with robust activity.

As of March 28, the daily total net inflow for spot Bitcoin ETFs in the U.S. amounted to $183 million, contributing to a cumulative total net inflow of approximately $12.13 billion. Data from SoSo Value indicates these positive trends.

Among the spot bitcoin ETFs, BlackRock’s iShares Bitcoin ETF recorded the largest net inflow of $95.12 million, followed by Fidelity’s Wise Origin Bitcoin Fund with a net inflow of $69.09 million.

Conversely, the Grayscale Bitcoin Trust observed net outflows, with nearly $105 million exiting the product during this period.

Spot bitcoin ETFs have garnered significant attention and adoption since their approval earlier this year. Despite a decline in volumes from their peak in early March, cumulative volumes are steadily progressing towards $200 billion, reaching $177.9 billion as of March 27, according to data from The Block.

Assets under management and on-chain holdings for spot bitcoin ETFs have also stabilized since their previous highs earlier in the month.

The current price of Bitcoin sits at $69,841, exhibiting a slight decrease of less than 1% for the day, according to The Block’s Price Page.

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In a recent blog post, Ethereum co-founder Vitalik Buterin shared his thoughts on memecoins and their potential to contribute positively to the cryptocurrency space. Buterin expressed his general disapproval of negative memecoins but emphasized the importance of fostering “good ones” that make constructive contributions.

Highlighting one of his moral principles, Buterin stated his lack of enthusiasm for memecoins associated with totalitarian political movements, scams, or rugpulls, which often result in disappointment and harm to participants. He acknowledged the recent surge of intentionally offensive memecoins, including those containing racial slurs or references to sensitive historical events like the Holocaust, expressing concern about their negative impact.

Despite these concerns, Buterin recognized the value of people’s desire for enjoyment and suggested that the crypto space should embrace this trend by promoting high-quality, fun projects that contribute positively to the ecosystem and society. He advocated for a balance, aiming for more good memecoins that support public goods rather than solely enriching insiders and creators.

Buterin proposed charity coins as an example of memecoins that could align with this vision, where a portion of the token supply or ongoing fees are dedicated to charitable causes. His remarks come amid ongoing discussions within the industry about the role of memecoins, with some expressing frustration over their potential to overshadow legitimate projects and concern over their regulatory implications.

Recently, regulators such as the Financial Conduct Authority in the UK have issued warnings about the risks associated with memecoins, particularly concerning their promotion by influencers on social media platforms. The FCA emphasized the need for approval from authorized representatives before advertising or posting memes related to financial products or services, including cryptocurrencies.

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Bitcoin futures open interest on centralized exchanges has surged to a new peak, reaching $38 billion. This uptick in open interest correlates with Bitcoin’s price spike to $70,000, marking a 66% increase year-to-date.

The heightened open interest for Bitcoin futures suggests increased trading activity surrounding the leading cryptocurrency by market capitalization. CoinGlass reports that aggregated open interest for Bitcoin futures soared to its all-time high on Friday.

Since the beginning of 2024, the daily open interest in Bitcoin futures has surged, more than doubling from approximately $17.2 billion on January 1st. This rise parallels Bitcoin’s price surge, indicating a strong market sentiment and heightened interest among traders.

Open interest serves as a metric for the total value of all outstanding or “unsettled” Bitcoin futures contracts across exchanges. It reflects the level of market activity and trader sentiment towards a specific asset.

The current open interest figure coincides with a monthly volume exceeding $2.3 trillion in Bitcoin futures during March across various exchanges, marking the highest level since May 2021, according to data from The Block’s data dashboard.

Additionally, Ether futures’ total open interest stands at $13.8 billion, showing an almost 90% increase since the beginning of 2024. Ether’s trading price has surged to $3,500, reflecting a gain of over 53% year-to-date.

In recent months, the introduction of Bitcoin spot exchange-traded funds (ETFs) by firms like BlackRock has influenced market sentiment, leading to cumulative net inflows of over $12 billion into Bitcoin spot ETFs to date.

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