There Are Significant Differences between Investing in Bitcoin and Stocks

Alexander Salazar
-
0
There Are Significant Differences between Investing in Bitcoin and Stocks

The price of Bitcoin has increased significantly, while stocks have made little gains over the last few years. Different people have bought the two asset classes, including many young investors interested in the technology behind cryptocurrencies.

Bitcoin (BTC) became a popular investment among leading institutions during the 2021 bullish market. However, stocks are usually the asset class established investors turn to when undergoing crises.

There Are Various Differences between Bitcoin and Stocks

The largest cryptocurrency by market capitalization is a decentralized asset, which makes it independent of banks and states.

Bitcoin emerged as an alternative currency, but its considerable appreciation led more small investors to buy it. Over the last few years, leading institutions like companies and banks have become interested in it.

Meanwhile, investors can also purchase stocks, which allows them to receive dividends when a company grows. Those assets are classic financial products whose trade has occurred throughout generations.

The Price of Stocks Influences the Value of Bitcoin

The price of Bitcoin has experienced significant increases, while stocks made little gains over the last few years. Due to the nature of the pioneering cryptocurrency, it can remain strong when classic financial assets are weak.

Since Bitcoin and other cryptocurrencies are unregulated assets, their prices have increased dramatically. However, they have also been subject to extreme fluctuations over short periods, causing investors to lose money quickly.

Over the last two years, the price of BTC largely depended on the development of classic financial products. Technology stocks on the US NASDAQ increasingly determined the trend in the value of the cryptocurrency. A growing number of institutions started to invest in Bitcoin and Bitcoin ETFs as other financial products intertwined with classical markets.

While Some Choose to Buy Bitcoins, Others Invest in Stocks

Different people have bought the two asset classes over the last few years. Many young investors interested in technology consider Bitcoin and other cryptocurrencies an investment. BTC emerged from a niche and became increasingly popular during the 2017 bullish market.

Well-established investors, usually middle-aged people, prefer to buy stocks, unlike what happens with Bitcoin. Leading institutions, established for decades, are also likely to invest in stocks.

There Might Be a Recession in the Short Term

Over the last few months, inflation rates and raw material costs have risen sharply, suggesting an imminent recession. Central banks in the US and Europe had to end their low-interest rate policy and raise the benchmark interest rate.

Higher interest rates might promote recession in Western countries like Germany, with negative economic growth in the coming months. In addition, equity markets have already suffered heavy losses over the last few weeks, which makes a recession seem imminent.

Since many associate Bitcoin with further risk, investors should know the technology behind it and follow its market regularly. The crypto market offers them significantly higher chances of profiting considerably in the short term if they have knowledge and patience.

Financial goals and personal taste will determine the type of investment investors may choose in the coming months. Low-interest rates and high inflation make leaving their money in their bank account a poor option.

By Alexander Salazar

Ethereum (ETH) Struggles to Stay at $1,200 Despite Increased Network Activity

Audy Castañeda
-
0
Ethereum (ETH) Struggles to Stay at $1,200 Despite Increased Network Activity

The launch of a new token has made Ethereum deflationary. The token represents more than 25% of the network fees.

Ethereum (ETH) price has declined, but there is a rapid increase in new ETH addresses, the highest for 2022. What is driving a new high in network activity during the bear market?

The Ethereum network, after successfully transitioning to the Proof-of-Stake consensus algorithm from Proof-Of-Work, is witnessing the highest network growth of 2022.

The growth is 11.1% more than the highest of 2022, according to the market intelligence platform Santiment. The number of addresses holding more than 1 ETH hit a new all-time high, according to on-chain analytics platform Glassnode.

Santiment tweeted that, “Ethereum saw a surge of new addresses created Saturday, with 135,780 new $ETH addresses popping up on the network. This is 11.1% more network growth than the next highest of 2022 (Jan 3rd). Utility rises commonly foreshadow potential asset breakouts.”

What Drives ETH Addresses to a New High?

Ethereum’s news about The Merge can be seen as a determining factor. Several dApps have moved onto the Ethereum network, creating new addresses.

But there is a widespread belief that the launch of a new cryptocurrency, XEN, is driving on-chain activity on Ethereum. It has accounted for more than 25% of network fees, worth more than $900,000 in the last 24 hours, according to data from Etherscan.

What is XEN?

XEN is designed by the Fair Crypto Foundation, which claims that it is Proof-Of-Stake crypto. Whoever participates in the creation of XEN has full ownership rights through self-custody. According to the litepaper, creating a new XEN is similar in difficulty to Bitcoin mining.

It is worth remembering that a litepaper is a shortened more concise version of a whitepaper and serves to pique the interest of curious users and investors.

The project is founded by a former Google employee, Jack Levin. Anyone can mint XEN tokens by connecting their wallet to the XEN smart contract. Users are believed to claim XEN tokens from new wallets to claim rewards.

Jack Levin states that, “the first principles of Blockchain that anyone can coin for themselves, by connecting an Ethereum-compatible wallet, setting a time limit, and sending a transaction.”

Ethereum (ETH) Price Fights

Despite the massive increase in on-chain activity and news from Ethereum that the network is temporarily going deflationary, there is no positive impact.

ETH price closed below the 200 weekly simple moving average (SMA) support yesterday, on a daily time frame. Ethereum price should hold and close above the 200 weekly SMA before the weekly close to hold the $1,200 level.

ETH price is struggling to hold the support around $1,281. That is a critical area because there was strong resistance from June to July in this price range as well.

Also, the price of ETH is forming a bearish flag which is a bearish pattern. If there is a breakdown, the price may visit the $1,000 area again.

Closing below this area will result in more pain for ETH price because there will be a bear flag breakout, a breakout of the 200 weekly SMA, and a major horizontal support breakout.

By Audy Castaneda

The Price of the SOL Token Plummets Due to the Power Outages of Solana

Alexander Salazar
-
0
The Price of the SOL Token Plummets Due to the Power Outages of Solana

The Solana network achieves over 3,000 transactions per second and has some of the lowest fees. Its developers hope a new validation client will help it scale and improve transaction speeds, providing stability.

The Solana (SOL) network, very promising when it emerged in 2020, has become cannon fodder for pranks on social media. According to jokes from observers, it has more power outages than the UK might have this winter.

Solana Is the Self-Proclaimed Killer of Ethereum

Solana, the self-proclaimed killer of Ethereum, raved about its capabilities when it emerged in 2020. It said it supported over 50,000 transactions per second and had over 200 nodes on its testnet then.

This protocol is among the few that achieve over 3,000 transactions per second, with a theoretical maximum capacity of 65,000. The validating nodes keeping the blockchain secure and processing transactions seem to have exceeded 2,000.

The Solana network also has some of the lowest transaction fees in the crypto market, averaging USD 0.00025. Ethereum, the most prominent money, NFT and dApps platform, processes only 20 transactions per second, each at USD 0.52.

The Solana Network Has Frequent Power Outage Issues

Although Solana offers comparative advantages, it struggles to achieve efficiency as frequent network outage issues cause inconvenience to millions of users.

Memory overload, bugs, or power outages have led Solana to collapse eight times from inception. Meanwhile, Ethereum froze in 2017 after launching CryptoKitties non-fungible tokens (NFTs) and ran into trouble in April when releasing the NFT Otherside for USD 500 million.

According to experts, Solana has been ready for trouble from the beginning. Justin Bons, the founder of Cyber ​​Capital, said the way Solana responded outrageously to a technology failure in early October.

Solana did not work for over three hours on October 1st, as a single validator created an invalid block. Bons, a cryptocurrency researcher, explained that the situation got validators stuck on the wrong chain, unable to return.

Solana Needs to Solve Its Power Outage Curse

Anatoly Yakovenko, the co-founder of Solana, promised a long-term solution to the power outages. He referred to that situation as their curse but said enough users and apps run it as it is cheap and fast.

The developers behind Solana hope a new validation client will help it scale and improve transaction speeds. Regarding how it works, they believe it will provide the network with stability on a white paper.

The validator might position Solana for higher long-term impact through the latest algorithms, software, hardware, and network technologies. Those factors would increase transaction performance and lower the fees per transaction as much as possible.

Yakovenko said a separate team would develop the validation client, which means they may not have the same bugs in the code.

The Price Action of the Native Token of Solana

SOL, the native token of Solana, could not avoid suffering the consequences of the power outage curse. After rising by over 10,500% in 2021, it has dropped like a brick this year. The crypto asset peaked at USD 260 on November 6th, 2021, but has plummeted by 87% since then.

Solana is trading at around USD 30.93 and has accumulated a 1.7% loss over the last 24 hours. While its daily trading volume is above USD 665.97 million, its market capitalization is about USD 11.06 billion, according to CoinGecko.

By Alexander Salazar

Why your Cryptocurrency Investment Could be at Risk for the Remains of October

Audy Castañeda
-
0
Why your Cryptocurrency Investment Could be at Risk for the Remains of October

With no major short-term bullish catalysts in sight, Bitcoin price has little to no support in the event of a bearish turn.

Bitcoin (BTC) and the global cryptocurrency market capitalization have moved in tandem in recent months, as BTC leads further market momentum.

The global crypto market has been in a prolonged downtrend for over 11 months, as Bitcoin, Ethereum (ETH), and most major altcoins are undergoing a massive correction.

After the price of Bitcoin reached an all-time high of $69,000 in November 2021, the largest crypto market has fallen along with the price of BTC.

The historic pullback has hit HODLers, traders, and investors as major crypto assets continue to oscillate in the vicinity of the lower price range.

Little Chance in October of Relief for Cryptocurrencies

Bitcoin, the oldest cryptocurrency and the one with the largest market capitalization, with more than 368 billion dollars, is often called the “King of the market”, and with good reason. BTC price generally drives the largest market flow, unless you are in an alt season.

The most recent BTC price stood at $19,153.35, and it still hovers in a tight range below the $20,000 mark. With no major short-term bullish catalysts in sight, Bitcoin price has little to no support in the event of a bearish turn.

The price of BTC recently fell below a crucial wall of demand around the average price of $19,357 according to the In/Out of the Money Around Price indicator from Into The Block.

If the price of BTC continues to fall, the addresses that are now at a loss may be forced to sell, which will further push the price of Bitcoin lower.

Meanwhile, the next significant support for BTC would be at the $16,000 mark. However, a visit to that lower level could also lead to significant losses for the larger crypto market.

It is the “Bitcoin season”, for the Moment

In an altseason, investors often expect decent gains from the massive rallies that altcoins exhibit, as BTC maintains a calm but bullish tone.

In recent weeks, the market has been heavily led by BTC, and an altseason does not appear to be in the cards for crypto investors, according to the altseason index.

Additionally, with BTC’s volatility index falling to its lowest level since December 2020, the volatility that aids sudden price momentum, which often fuels short-term gains for altcoins, is also absent.

All in all, with Bitcoin ruling further market momentum as most major altcoins were highly correlated with Bitcoin price, more sell-offs could apparently await investors.

Furthermore, analysts’ Bitcoin market sell-off warnings keep popping up.

Therefore, October could play at the mercy of BTC, and with the price of Bitcoin at a crucial crossroads, there could be a cascading effect on the major cryptocurrencies.

Anyway, before making investment decisions, it is worth conducting your own research. As Joey Krug, Co-Chief Investment Officer at Pantera Capital, shares, people thinking of investing in Bitcoin should consider the following:

“You have to remember that Bitcoin could go down as much as 70%. You also have to keep in mind that it is possible for it to go up much more than that 70%. As a final tip for beginners in Bitcoin and other cryptocurrencies, related to those two points, it is best to make an investment that doesn’t make you lose sleep over every short-term price change.”

By Audy Castaneda

Argentina Implements the “Coldplay Dollar”, a Special Exchange Rate for International Show Producers

Audy Castañeda
-
0
Argentina Implements the “Coldplay Dollar”, a Special Exchange Rate for International Show Producers

It will have a surcharge of 30%. Entrepreneurs will be able to receive the money faster. The objective is to take care of the reserves.

Next week, two variants of the exchange restrictions will begin to operate. On the one hand, the postponed “Qatar dollar” increases the cost of traveling abroad. On the other, a special quote for the payment of services for international artists who perform in Argentina. With this, the list of the different dollars that coexist from the beginning of the limitations is enlarged.

The two measures aim to take care of the reserves of the Central Bank of the Argentine Republic (BCRA). In September, the management of the Minister of Economy, Sergio Massa, was able to strengthen the entity’s coffers. Now the challenge is to go through the last quarter of 2022, with numerous shows arriving, and a large number of Argentines with the intention of seeing Messi’s last World Cup.

Members of the Argentine Association of Theatrical and Musical Entrepreneurs (Aadet) turned to Massa to obtain a resolution that would allow them to access dollars in a timely manner but at a higher exchange rate.

Dollar for International Shows

The scheme, baptized as “Coldplay dollar” for the series of ten recitals that the British musical group will offer in the country, will be announced in the next few hours. Strictly speaking, it is a differential value for the currencies that are used to pay the fees of international artists who come to perform in Argentina.

The “Country Tax” will be applied to this item. The aliquot would reach 30%, and thus a price close to 200 Argentine pesos would be reached, according to current values.

Businessman Carlos Rottemberg, President of Aadet, pointed out that the most onerous foreign payment is the hiring of international artists. He explained that, “some foreign artists have worked without pay, so it is urgent to be able to unblock this situation. One side of the coin is hiring artists, and the other is that a show, depending on its size, has between 400 and 1,200 jobs behind it, all of which are national.”

In the Argentine Government they estimate that, until the end of the year, about 150 shows with international artists remain to be performed, for which the measure will apply.

More Dollars

This series of measures is complemented by the larger disbursement expected from international organizations in the last quarter, which will help increase net reserves and meet the goals with the IMF for the remainder of the year.

The next stage of the plan that Massa has been carrying out is the most complex: reducing inflation. For this there will be announcements in the coming weeks that aim to consolidate the slowdown in public spending, together with the reduction of the fiscal deficit to 1.9% of GDP in 2023.

Massa will leave on October 12th for Washington, United States, to participate in the joint Annual Assembly of the International Monetary Fund (IMF) and the World Bank, after the first of the organizations announced on Friday the approval of the second revision of the Facilities Agreement Extended (EFF).

At the IMF and the World Bank, Massa plans to participate in the work meetings of the International Monetary and Financial Committee, as well as in the activities within the framework of the Development Committee.

By Audy Castaneda

Ethereum Already Behind Cardano and Solana in Network Speed

Audy Castañeda
-
0
Ethereum Already Behind Cardano and Solana in Network Speed

The effects of the transition to Proof-Of-Stake (PoS) are still debated.

There was an increase in the number of blocks processed by the Ethereum network after the Merger, putting ETH behind competitors like Cardano (ADA) and Solana (SOL) in network speed, but still well below of expectations.

The long-awaited Ethereum upgrade has raised a lot of expectations among community members about the changes in the ecosystem. Since September 15, when the Merger occurred, the number of blocks processed has increased almost instantly.

Block processing went from 6,000 confirmed to approximately 7,100 blocks per day, something that was already expected. However, the result was below expectations.

ETH Validation More Efficient, But Not as Fast

Even though Ethereum validators now verify transactions faster, the speed of the network has only increased by 13%. Before the Merger, the promise was a 100% raise.

Ethereum already lags behind Cardano, Solana, and Avalanche in terms of network speed, leaving network users dependent on stacks for faster transactions.

The main goal of the Merger was to make the Ethereum network more energy efficient. The solution the developers found to make this possible was to change the network’s consensus mechanism from Proof-Of-Work (PoW) to Proof-Of-Stake (PoS).

This step was already planned in the Ethereum network roadmap; however, it was brought forward a few years, due to the high usability that the network has acquired in recent years, with the appearance of DeFi and NFTs, impacting the gas rates of the net.

Although it has drastically reduced energy use by more than 98%, its high gas rates still affect users. Replacing miners with validators is another point of debate in the crypto community.

To become a validator and verify new blocks, it is necessary to block the 32 ETH network. This amount of ETH is considered high for individual validators and is causing exchanges to dominate the staking process; as a result, this is leading to centralization of the network.

Buy the Rumor, Sell the Fact

Speculation on the price of ETH was high before the Ethereum Merger. Many have fueled the expectation of a soaring asset price, which hit $1,700, but fell to $1,400, 24 hours after The Merger.

ETH’s slump can be linked to broader macroeconomic conditions as central banks continue to raise interest rates to deal with sky-high inflation. Adding to the network problem is the protest of miners boycotting the PoS network, which has seen several hard forks, such as EthereumPoW (ETHW), rise from the ashes in protest of the Merger.

The experts have been making predictions about the price of ETH in the next months, and as author Goran Radanovic summarizes it, these are some major highlights:

End of 2022 – Ethereum could reach $4,000 by the end of the year. That price level is the high set during the coin’s 2021 Bull Run before a significant retrace.

End of 2023 –Ethereum will encounter heavy resistance, the same as the last Bull Run. It is expected to surpass its ATH, and set a new one at around $6,000.

End of 2024 –Ethereum will revisit its key support, at around $1,400 – ATH set in 2018.

As usual, the best thing to do, before considering any major investment moves, is to do your own research.

By Audy Castaneda

1...640641642...1,654Page 641 of 1,654