While Powell is not afraid of the winter season of cryptocurrencies, Choi foresees an increase in the number of people who use them. The metaverse could contribute to the massive use of crypto assets, and Tesla could accept the DOGE memecoin as a payment method.

In December, the streets in the world are usually full of people celebrating the arrival of the Christmas season. However, the cryptocurrency market is going through a critical period that has affected the price of most participants.

Kraken CEO Is Not Worried about the Current Cryptocurrency Crisis

Jesse Powell, CEO of the exchange Kraken, recently commented that Bitcoin could drop in 2022. However, he anticipated a sell-off of Ether (ETH), BNB, Solana (SOL), Cardano (ADA), and XRP.

Although Powell believes that cryptocurrencies are entering a winter season, he does not seem to worry about it.

The executive recommended that Americans stock up on food and pay all debts or bills in advance. He predicted that interest rates would rise to unsustainable levels very soon. For that reason, he advised not to acquire debt that is difficult to pay or not adjusted to the socioeconomic condition of each person.

Emilie Choi Expects More Cryptocurrency Users in the Coming Years

The president of Coinbase, Emilie Choi, recently spoke about the upcoming scenario for cryptocurrencies. She also commented that the uncertainty surrounding current regulations hampers the advancement of those assets.

However, she expressed her optimism about the number of cryptocurrency users in the years to come. In that particular, she estimated that close to one billion people would use Bitcoin within approximately five years.

Leading Banks Consider the Metaverse Will Influence Cryptocurrencies

The development of the metaverse has attracted the attention of the leading financial institutions worldwide. They believe that those digital worlds are crucial for cryptocurrencies to find their place in society.

The research director of Bank of America said that cryptocurrencies could become massive in that virtual universe. Besides lower payments for services, the use of crypto assets includes higher expenses such as acquiring land and cars.

A CoinMarketCap Error Briefly Indicates Users Are Millionaires

Cryptocurrency price tracking website CoinMarketCap recently had an error/bug for a brief moment. The data from the platform showed some unusual figures on the prices and market capitalization of cryptocurrencies.

Users could appreciate the pronounced fluctuations in the prices of the leading cryptocurrencies on the market. In that regard, those in charge of the platform said they would restart their servers, although they had already solved the problem.

Elon Musk Announces Tesla Will Accept Payments with Dogecoin

Billionaire businessman Elon Musk recently announced that Tesla could offer new merchandise people would buy with Dogecoin. He tweeted that he was willing to have his company accept the memecoin as a payment method.

The CEO of Tesla said the electric car company would launch merchandise purchasable with DOGE to assess its progress. However, there is no confirmation yet that they will allow cryptocurrency transactions.

The current drop in cryptocurrency prices has caused a lot of concern in the community. However, this is not the first time this has happened in the crypto market. Some analysts are optimistic that Bitcoin and altcoins will rally next year.

By Alexander Salazar

Time magazine considers that Elon Musk is the richest man in the history of the world. One of his most successful companies is Tesla, an electric car manufacturer that now accepts DOGE.

Every December, Time magazine publishes information about the person they consider the most outstanding of the year. In 2021, the winner was one of the most influential men in the ecosystem of Bitcoin and cryptocurrencies. He is none other than billionaire businessman Elon Musk, who has earned the love and hate of the community.

Time describes Musk as the richest man in the history of the world without a home. Although his net worth is around USD 250 billion, the entrepreneur lives in a humble 1,370-square-inch prefabricated property. He has said that this allows him to keep in touch with society and control money.

According to the magazine, Elon sees his vast fortune as a mere side effect of his ability to see and do things that others cannot.

Technology innovation motivated him to create Tesla, an electric car company accounting for two-thirds of the world market. Likewise, his ingenuity led him to found SpaceX, which became one of the first companies related to space transportation.

Musk has shown his devotion to technology in his relationship with cryptocurrency investments by reporting that Tesla stores part of its funds in Bitcoin. Besides, his Twitter comments drove its price higher and lower throughout the year.

Elon Musk Is an Influential Cryptocurrency Enthusiast

According to Time magazine, Elon Musk drives the stock market value higher or lower with a flick of his fingers. For example, he boosted the increase in the price of Bitcoin in early 2021 by motivating his Twitter followers to invest in it. However, he also influenced its fall when he stopped accepting the payment for Tesla cars with Bitcoin.

The businessman argued that Tesla would not allow that form of payment unless Bitcoin mining reduces its energy consumption. However, he said that he still maintains his support for the cryptocurrency, which he keeps as a store of value. That caused controversy in the community since various studies reveal that the activity represents energy consumption below 0.1% worldwide.

Elon Musk Reaffirms His Support for Dogecoin, without Dropping Bitcoin

The fluctuating price of memecoin Dogecoin (DOGE) has significantly marked the impact of Elon on the market. According to Time, an army of DOGE devotees depends on everything the businessman says.

A single tweet from Musk referring to the dog identifying the cryptocurrency has been enough to motivate its purchase.  Besides, that has had a rebound effect leading to an increase in the value of the memecoin.

Although meme cryptocurrency Dogecoin became very popular in 2021, it does not have large investors and trades below USD 1. For that reason, the price increases when several people agree to buy, which Musk enhances with his tweets.

Elon Musk recently reaffirmed his interest in Dogecoin by announcing that Tesla would accept it as a payment method. However, he warned that he would evaluate that initiative. His company has also stated that it has not yet sold any Bitcoin.

Right now, Bitcoin is trading at around USD 47,691 and has accumulated a profit of 1.0% in the last 24 hours. Its daily trading volume is above USD 27.6 billion, and its market capitalization is about USD 901 billion, according to CoinGecko.

By Alexander Salazar

Investors fear there could be a reduction in the Fed’s bond buyback program since it would affect Bitcoin. A cancelation of USD 300 million worth of long leverage contracts seems irrelevant compared to the decline on December 3^rd.

The community might remember December 13^th as the day when the value of Bitcoin (BTC) lost the support at the USD 47,000 mark. That date might also remind them the prices of altcoins dropped as much as 25% in a matter of moments.

When that occurred, analysts related the 8.5% correction of Bitcoin to the announcement of the Federal Open Market Committee (FOMC) meeting.

The Federal Reserve could begin tapering, which frightens investors since there could be a reduction in their bond buyback program. Logically speaking, a revision of the current monetary policy would negatively affect the riskiest assets, among which is Bitcoin.

There is no way to prove that hypothesis, but Bitcoin had accumulated a 67% profit this year until December 12^th. Therefore, investors thought it made sense to withdraw those gains amid market uncertainties, leading to the current correction in the price.

The price of Bitcoin dropped by 8.2% over the past week but outperformed the broader altcoin market. In contrast to the last 50 days, the market share of the pioneering cryptocurrency went from 47.5% to 42%. Probably, investors decided to flee to Bitcoin because it is relatively less risky than altcoins.

The Premium of Tether Bottoms out at 4%

Tether (USDT) premium measures the difference between China-based P2P transactions and the official currency in US dollars. While figures above 100% indicate excessive demand for investment in cryptocurrencies, a 5% discount is usually a sign of high sales activity.

On December 13^th, the Tether indicator bottomed out at 96%, slightly bearish. However, it is not alarming for a drop of 10% in the total cryptocurrency market capitalization. That metric has not exceeded 100% for over two months, a sign of a lack of enthusiasm among China-based traders.

Total sell-offs in 24 hours reached USD 400 million, demonstrating that the price drop only slightly affected investor sentiment.

Insufficient margin caused the forcible cancelation of only USD 300 million worth of long leverage contracts. That figure seems irrelevant, compared to the decline on December 3^rd, when there was a closure of positions of USD 2.1 billion worth of leveraged buyers.

At the Moment, Bitcoin Bears Do Not Make Excessive Demand

Traders should look at perpetual futures to prove the sharp price drop did not affect the cryptocurrency market structure. Those contracts have a financing fee and usually charge a fee every eight hours to balance the risk of the exchange.

According to a positive finance rate, longs (buyers) demand higher leverage. However, when shorts (sellers) request it, the finance rate turns negative.

Most cryptocurrencies suffered significant losses on December 13^th, so the overall market structure held up well. If shorts had bet on a drop in the price of Bitcoin below USD 46,000, perpetual 8-hour futures funding would have fallen below 0.05%.

Tether is trading at a 4% discount in Chinese markets, and there is USD 300 million worth of long contract settlements. Requesting USD 42,000 or less for Bitcoin will not make sense unless those fundamentals change significantly.

By Alexander Salazar

Active Bitcoin addresses served as an indicator of network activity. These wallets got related to entities that control a certain number of profiles.

After developing its methodology to understand the use of bitcoin, Coin Metrics revealed in its State of the Network # 133 report an estimate of how many bitcoin wallets are active daily. The analytical firm highlighted, with roots in measurements made last week, and based on 1 million Bitcoin addresses, a daily average of 500,000 active wallets.

The study aims at the number of active addresses and addresses with a non-zero balance of BTC; in the early days of Bitcoin, it was the best metric to study network use.

The study quickly discovered that this approach had many downsides, as it overestimated activity from services such as exchanges or even gambling services. These bodies manage millions of addresses, but these profiles do not correspond one-to-one with users or wallets.

The report highlighted that the study reflected on group addresses that belong to the same body. Heuristics is the set of techniques and methods that allow solving a problem related to the network. The research also clarifies that individuals can own multiple wallets, but this is much less likely than owning various addresses.

According to the report, there are many heuristic methods for gathering addresses into groups related to a wallet. The most efficient is the so-called “shared input heuristic,” which got even mentioned in the Bitcoin White Paper. This methodology, according to the authors, is called Shared Input Property or Co-expense Heuristics.

Metrics on Wallets to Understand More about Bitcoin Behavior

Active Bitcoin addresses usually overestimate unique users, as users generally tend to deal with multiple addresses. According to the study, the number of active addresses is generally more prominent than the active daily wallets by a factor of 2. Coin Metrics explained that last week, there were half a million active wallets on average per day, compared to 1 million addresses per day.

The researchers discussed that wallet metrics offer a better indicator of bitcoin users but they pointed out that wallets should not get interpreted as unique individuals. The analysis ends up by saying there are groups of addresses that could get managed by bodies such as exchanges, which could make the activity of many users per day easier.

The wallet metrics also bring another view on the distribution of bitcoin possession. The analysis even showed the current percentage of bitcoin supply connected to wallets of various sizes.

Coin Metrics highlights some limitations regarding these metrics. When the distribution takes effect by the balance of the addresses, the portfolios with a balance that surpasses 10,000 BTC appear with a higher percentage of supply than the addresses with more than 10,000 BTC.

This event shows large entities such as exchanges once they get all grouped into portfolios, according to the report, and represents a serious limitation of the current methodology that gather all address into entities.

By: Jenson Nuñez