Source: Adobe/Alexey Novikov

Even today, there is a non-trivial chance that governments try to ban Bitcoin (BTC), according to Marco Santori, the recently appointed Chief Legal Officer (CLO) of major crypto exchange Kraken.

I dont think its a 20% or 30% chance in the next five years, but I think its real. And its up to us to do everything that we can to give this stuff realand maybe this is where this starts to get a little controversialreal functional use that people in government can appreciate as something more than just what they see oftentimes as a casino, he said during the Kraken Block Drop VR Halving Party on Sunday.

Santori noted that its important for crypto lobbying organizations like Coin Center to be on the front lines to make sure that the Overton window, which is the range of ideas that the general public is willing to accept from politicians, never opens far enough for a ban on Bitcoin to ever come close to a possibility.

That said, Santori tries to remain practical in terms of the potential for a ban.

I still operate every day as if it is a non-trivial possibility [Bitcoin could be banned], and I think folks who are regulated and subject to laws are wise to think that as well, said Santori. There was a time where I wouldnt have described it as non-trivial . . . I would have described it as maybe a 20% chance [or] 30% chance.

According to the CLO, his views on the potential for an outright ban on Bitcoin were altered by the release of FinCENs (Financial Crimes Enforcement Networks) guidance regarding cryptocurrencies like BTC in 2013.

When the government first said, Okay Bitcoiners. Youre under our thumb. You have to follow the rules like everybody else. I think a lot of people reacted negatively to that, but just as many people reacted positively, explained Santori. They thought, Oh my goodness. This is the government recognizing the legitimacy of this thing. They said something for the first time about Bitcoin and it wasnt that its bad and illegal.

Before joining Kraken, Santori served as President and Chief Legal Officer for Blockchain.com, a major crypto wallet provider, and is known as the Dean of Digital Currency Lawyers for his work in litigating, advising on and creating new law in the crypto industry.

In April, he argued that the courts, not the lawmakers, will likely be the ones that'll make "new sources of law" for the crypto industry within the next couple of years.

Meanwhile, during the same discussion on Sunday, Coin Center Director of Research Peter Van Valkenburgh, said that preventing a government ban has been easier than youd think.

Government is just a bunch of people, and they all have their specific interests, said Van Valkenburgh.

From his perspective, people at the Securities and Exchange Commission are mostly interested in protecting mainstream investors from penny stocks and certain initial coin offerings, FinCEN just wants to make sure illicit money isnt flowing through the regulated financial system, and the Internal Revenue Service just wants Americans to pay their taxes.

Maybe the taxes thing is where things start to break downwhere if you had widespread tax evasion because of Bitcoin wed see a different tone, youd see government unify under one interest (they all want to make sure they still get paid as a government), Van Valkenburgh added. But right now, you have a bunch of fractured interests, and you dont have an existential threat to the government. So, there really hasnt been a widespread call here in the US amongst anyone in Congress or the agencies to sort of ban this thing.

According to Van Valkenburgh, the United States has a long history of not just accepting new technologies but also embracing and promoting them to the point where politicians want to take credit for these advancements. The Coin Center director of research pointed to Al Gores infamous claim (which he didnt actually make) that he invented the internet as supporting evidence for this phenomenon.

The internet created a whole new suite of potential vulnerabilities and issues for American society, but our reaction wasnt to get rid of it, said Van Valkenburgh.

He added that for every congressperson or regulator who gets loud about the perceived negative aspects of Bitcoin there are one or two people in government who are excited about the technology and think its cool.____

Learn more:As US Seized Gold in 1933, Is There a Threat to Bitcoin in the 2020s?This Is How G20 Might Keep Crypto And Stablecoins at BayIndia's Crypto Ban Overruled, But the Battle is Far From OverUS Congressman Wants to Outlaw Crypto, Cryptoverse Fires Back

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There's Still a Non-Trivial Chance of a Ban on Bitcoin - Kraken CLO - Cryptonews

A visual representation of the digital cryptocurrency bitcoin.

Yu Chun Christopher Wong| S3studio | Getty Images

Bitcoin faces a key technical event Monday known as the "halving." Due to take place later in the day, industry insiders are debating what effect it might have on the cryptocurrency market.

So what is the halving? You can think of it as an update to the underlying network that logs all bitcoin transactions. There are so-called "miners" on this network with specialized computing rigs competing to solve complex math problems to validate bitcoin transactions. Whoever wins that race gets rewarded in bitcoin.

On Monday, the amount of bitcoins rewarded to those miners is set to get cut in half. This is something that takes place roughly every four years to keep a lid on inflation. The current reward stands at 12.5 bitcoins, or BTC, so that will now be reduced to 6.25 BTC.

Unlike fiat currencies like the dollar, there is no central bank that manages the supply of bitcoin or its inflation rate. Instead, this is maintained thanks to a rule written into bitcoin's code by pseudonymous inventor Satoshi Nakamoto.

The total number of bitcoins that will ever be mined is capped at 21 million. Rewards to bitcoin miners keep halving until they reach zero. Bitcoin bulls say that this scarcity is part of what underpins the cryptocurrency's value and make it a potential "hedge" against currencies that are vulnerable to devaluation in times of economic crisis.

"With its finite and scheduled supply and decentralized architecture, BTC, in particular, offers the certainty needed in times like these, and will likely become a new safe-haven asset class," cryptocurrency lending start-up Nexo wrote in a note last week.

Investors are likely to closely watch the reaction of bitcoin and other cryptocurrency prices to the halving event later in the day. Some believe the event has been mostly priced into markets already, but there are others who think it could boost prices.

The past two halvings led to opposite short-term price movements, according to British bitcoin exchange CoinCorner. Bitcoin climbed 7% one month on from the first halving event in 2012, but slipped 10% a month after the second one in 2016. However, the price rose 944% six months on from the 2012 halving and 38% in the same period in 2016.

"While many anticipate bullish movements post-halving, we believe the supply shock that comes immediately after the halving event should have limited impact on price in the short term," Lennard Neo, head of research at Singapore-based bitcoin index fund provider Stack, said in a note Thursday. "As the block reward for miners decreases, there will be a time lag as miners (supply side) reposition towards market equilibrium."

"We anticipate that it could take 6-9 months before this equilibrium is found and Bitcoin realises halving-induced price appreciation. That said, further turmoil in the broader economies could accelerate its upward trajectory."

But there are also fears that the 2020 halving will also have an impact on miners' earnings, as they'll need more competitive mining gear to win bitcoin rewards.

"Miners currently need to produce more work to get the same reward," said Ed Hindi, CIO at Cayman Islands-based cryptocurrency hedge fund Tyr Capital. "Post halving their expected returns will be cut in half."

Bitcoin has risen more than 20% since the start of the year. The virtual currency, known for its volatility, suffered at sharp drop over the weekend. It briefly touched $10,000 on Friday but has since declined to around $8,800 as of Monday morning.

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Bitcoin investors are bracing for a key technical event here's what you need to know - CNBC

Bitcoin is on the cusp of a supply squeeze, known as a halvingsomething that happens roughly once every four years.

But what will the bitcoin halving mean for the bitcoin price and should investors buy bitcoin now?

The bitcoin price has bounced around below $10,000 per bitcoin over the last week. Some are worried ... [+] bitcoin could be heading for a cliff edge after the halving.

Later today, expected around 5pm EDT, the number of bitcoin rewarded to those that maintain the bitcoin network, called miners, will be cut by halfdropping from 12.5 bitcoin to 6.25.

The effects of 2020 bitcoin halving, the first since bitcoin exploded onto the global stage as a result of its massive 2017 bull run, has been debated for years.

No one knows how the bitcoin price will react to the supply squeeze, though many in the bitcoin and cryptocurrency community are confident the bitcoin price will climb eventually.

But in the short term, the bitcoin market is widely-expected to be highly volatile.

"Through today we are likely to see increased volatility and tactical trading ahead of the halving," Marcus Swanepoel, the chief executive of London-based bitcoin and crypto exchange Luno, said in a note.

Bitcoin has already seen an uptick in volatility in the run up to the halving over the last week.

After starting last week at under $9,000 per bitcoin, the bitcoin price rallied hard to over $10,000 before crashing back over the weekend.

"The move back down to $8,000 wasnt a big surprise," said Rich Rosenblum, co-head of trading at Hong Kong-based crypto market maker GSR, adding, "its likely that were going to see increased volatility through May, with the pandemic, ongoing stimulus measures and the halving."

Bitcoin has been one of the best performing assets since the broad coronavirus market crash in March, with the bitcoin price more than doubling from lows of around $4,000.

Many bitcoin and cryptocurrency exchanges have reported surging user numbers and trading volume.

"Bitcoin has risen over 100% over the last few months and we believe most of that rise was driven by continued retail demand," said Scott Freeman, co-founder at New York-based bitcoin and crypto-focused institutional trading firm JST Capital.

"We expect continued volatility but expect to see good long term risk reward in bitcoin and also expect it to behave in an uncorrelated manner to traditional financial assets."

The bitcoin price, well known to be highly volatile, is expected to make wild swings after the ... [+] coming halving before the market settles.

Meanwhile, the bitcoin and crypto community was rocked last week by news legendary macro investor Paul Tudor Jones is buying bitcoin as a hedge against the inflation he sees coming as a result of unprecedented coronavirus and lockdown-induced central bank money-printing.

In a letter to clients, Jones said it reminded him of the role gold played in the 1970s.

"We think this could be a seminal moment for bitcoin," Freeman said in reaction to Jones' letter, which can be read in full here.

"Given the COVID-19 crisis and the easy money policies of major central banks, real money and macro investors are increasingly concerned about the value of traditional financial assets," Freeman said, adding, "we received several calls over the past week from institutional investors who now see bitcoin as a great hedge against the easy money policies and the looming global recession."

Continue reading here:
Bitcoin Halving: Is Now When To Buy Bitcoin? - Forbes

As the Bitcoin (BTC) price abruptly dropped from $9,500 to $8,100, some traders on Binance claimed that their winning short trades were unfairly cut short.

A trader named AthenaBank wrote on May 10:

Deleverage? Binance close my short after I make 7 times my investment. What's going on? Where is my short? The BTC dropped to $8,000. Who pays the difference?

But, the closure of the shorts was systematic and the process is called auto-deleveraging.

In the futures market, traders use debt or leverage to trade with larger capital. Binance, as an example, allows a trader to use 125x of their initial capital. If a user has $1,000, the user can trade with up to $125,000.

The role of a cryptocurrency exchange is to match orders between buyers and sellers. Hence, if trader A wants to short Bitcoin at $9,500, the role of the exchange is to find trader B that wants to buy BTC at the same price.

A problem occurs when the Bitcoin price sees an abrupt increase or decrease in price. More traders rush to short BTC, and as the price declines rapidly, it creates an imbalance in the orderbook.

When there is a big orderbook disparity, it can potentially cause a cascade of liquidations and cause the price of Bitcoin to plunge to abnormal prices. Such a price trend was seen on March 12, when the price of BTC crashed to as low as $3,600 on BitMEX.

Major Bitcoin futures exchanges like BitMEX and Binance Futures use a system called auto-deleveraging to ensure their orderbook remains balanced. When the insurance fund is not enough to cover for liquidations, then other trades are cut short to cover for the remaining liquidations.

Example of an auto-deleverage Bitcoin trade. Source: AthenaBank

Binance Futures says:

When a traders account size goes below 0, the Insurance Fund is used to cover the losses. However, in some exceptionally volatile market environments, the Insurance Fund may be unable to handle the losses, and open positions have to be reduced to cover them.

In such a case, highly leveraged trades are likely to have their trades sized down first. Traders that use 75 to 125x are often in the top percentile and are first to have their trades cut in abnormally volatile market conditions.

One trader explained:

There is a light for the auto deleverage queue on the trading page when you're in a position. Deleverage is used as insurance for long liquidation in this case to help sustain cascading liquidations and resulting in mega dumps. High leveraged trades are usually first.

Auto-deleveraging happens quite frequently in the cryptocurrency market because Bitcoin is significantly more volatile than most traditional assets.

The tendency of the price of Bitcoin to sway in a direction rapidly within a short period of time makes it challenging for exchanges to maintain balance in the market.

Cointelegraph reached out to Binance for a comment but did not receive a response by press time.

Read the original here:
Traders Say Binance Cut Their Bitcoin Shorts: Here's Why It Happened - Cointelegraph

As Bitcoin (BTC) fast approaches its scheduled third halving, several metrics are now pointing toward positive market sentiment going into this most-anticipated event.

The perpetual funding rate serves as a useful indicator to gauge overall market sentiment. When the rate is positive, long positions periodically pay short positions and vice versa. Funding rates also tend to correlate with market sentiment, meaning that when the market is strongly bullish or bearish, funding rates tend to be positive or negative, respectively.

The perpetual funding rate turned extremely negative during the Black Thursday market crash and crept back up to near-positive territory following the market crash, but it faced difficulty breaking to the positive side. The funding rate has weakly broken to the positive side during the first week of May while the Bitcoin network is gearing toward the third halving.

Traders are consistently buying put options, as indicated by the putcall ratio rising since the market crash in mid-March and reaching a three-month high. Generally speaking, a rising putcall ratio indicates bearish sentiment in the options market. However, I hold the same perspective as Matt DSouza, a hedge fund manager at Blockchain Opportunity Fund, which is that a constantly rising putcall ratio could be interpreted as a bullish indicator, thus acting as a contrarian view that traders are bullish for Bitcoins price and are holding Bitcoin and buying put options as hedges and insurances rather than speculation. As DSouza said:

A rising put to call means many investors are buying downside protection. I love it as a contrarian indicator. So when put/call gets extreme or greater than usual, I actually get bullish because I take a contrarian position. I like to do the opposite of the herd. This is most importantly, take the other side for the most part when the ratios go too far in either direction.

The Bitcoin options flows can also confirm the belief that traders are buying options for the purpose of hedging, as there are more put buyers than put sellers in volume. If there is significant volume on the sell side, it reflects market participants concern about a potential market downturn.

The Spent Output Profit Ratio, or SOPR, has broken and stayed above 1 as the market recovers from the Black Thursday crash.

During March and April, values of SOPR above 1 were rejected, indicating a micro bear market. However, as the market approaches the May Bitcoin halving, we have seen SOPR values from the last week of April break 1 and reject going below 1.

People, in general, are much more comfortable selling when they are in profit. When the market sentiment turns positive, people are reluctant to sell at a loss, thus an SOPR below 1 is rejected.

As the world is fighting off the COVID-19 pandemic, it is also worth considering this global situation. We believe there is still significant market uncertainty ahead, especially going into the halving, which has coupled with that uncertainty.

The market data points toward a positive but relatively weak sentiment, possibly indicating the market is cautiously optimistic about the current market structure.

The views, thoughts and opinions expressed here are the authors alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.

Johnson Xu is a devoted fintech professional with a background in finance and computer science and with substantial exposure to the cryptocurrency/blockchain industry. He is currently the chief analyst and leads research initiatives at TokenInsight, a company that provides investment research, ratings, data analysis, industry insights, investment management services, industry consulting, etc. His previous experience includes a global, top-tier cryptocurrency exchange and a Fortune 200 consulting company.

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The Market Perceives Positive Sentiment Heading Into the 2020 Bitcoin Halving - Cointelegraph

After a great start into 2020, bitcoin (BTC-USD) crashed together with all other markets during the coronavirus panic. Now bitcoin has fully recovered from these dark moments in mid-March and on Friday crossed the $10,000 level once again. While central bankers around the world are quantitatively easing their fiat Ponzi schemes, bitcoin will experience its third quantitative hardening in just a few days....

In my last Bitcoin (BTC-USD) analysis, at a price around $6,700, I expected the recovery to continue until around $8,000. Indeed, this is what happened. However, for several weeks prices were just slowly creeping higher. Only once the downtrend line at $7,150 was crossed the bitcoin market finally began to move on 23rd of April. Since then, the bullish forces have clearly asserted themselves and most recently drove bitcoin to its highest level at $10,025 since mid of February. Bitcoin has thus made up for all the losses from the crash in mid-March and presents itself very strong compared to almost all other asset classes.

Holger Zschaepitz @Schuldensuehner, 5th of May 2020

In addition to the technical breakout above $7,150, the reasons for the sharp rally in recent weeks are mainly to be found in the upcoming bitcoin halving and the unprecedented global money supply expansions. The corona crisis has definitely changed the world. An infinite number of small and large companies as well as an army of millions of new unemployed are now completely dependent on public funding. At every corner there is overcapacity, reflecting the sick frenzy of the last decades. With their balance sheet measurements, central banks are already surpassing everything that has been seen before, but in the end they too will have to realize that wealth cannot be created with the mere printing of currency.

Holger Zschaepitz @Schuldensuehner, May 4th 2020

On the contrary, the dramatic increase in debt will sooner or later devalue the purchasing power of euros and dollars etc. to an extreme degree. The US Treasury Department, for example, is planning a new record borrowing of $3 trillion between April and June in order to be able to pay the enormous coronavirus costs. A further $677 billion is planned for the 3rd quarter. Last year, $1.28 trillion new debts were already made. In the end, it is the citizens and taxpayers who pay this bill.

Forward-thinking investors have therefore stormed into the safe haven of gold in recent weeks. In the case of bitcoin, despite its relative strength, there has so far been no real sign of a flight to safety. Instead, the crypto currency has correlated much more strongly with the stock markets in recent weeks than usual. However, since about two weeks bitcoin is literally on fire.

Bitcoin Weekly Chart as of May 8th 2020, Source: Tradingview

Since its low of just under $3,800 on March 12th, Bitcoin has risen by 160% to $10,025 in the last eight weeks. This V-shaped recovery is currently taking Bitcoin to the longstanding former uptrend line from below. The break of this trend line caused the crash to $3,800 two months ago. A direct breakout above this resistance was a surprise but has already happened. Another serious resistance has been the downward trend line of the last 10 months. Bitcoin jumped above this line without any problems just yesterday.

The now realizing best case scenario has some more room to go. The 61.8% retracement at around $10,050 and also the 78.6% retracement at $11,733 are realistic targets. Even a direct rally towards the horizontal resistance zone between $12,500 and $13,800 has become a possibility. The stochastic oscillator is not yet overbought and is therefore not opposing this bullish scenario.

In summary, the weekly chart is bullish since the end of March. No reversal signals have been detected yet. Rather, the bulls still have room to move up to around $13,000.

Bitcoin Daily Chart as of May 8th 2020, Source: Tradingview

On the daily chart, the concentrated resistance zone around $9,200 was obviously not a real obstacle. However, the chart is now overbought while bulls stretching the upper Bollinger Band. So far, there are no reversal signals yet and a continuation of the rally has the better prospects for the time being. Moreover, Bitcoin is known for its extreme movements, which often overrun many support or resistance zones in both directions. But of course, the risk/reward-ratio at the current level is extremely unfavorable for new long positions.

Overall the daily chart is still bullish, but also overbought. A continuation of the rally towards $11,000 and higher seems possible. But the round psychological number $10,000 could also see some profit taking and initiate a healthy pullback. Also, be aware that there is a looming bearish wedge developing. A pullback would already represent a good buying opportunity in the range between $7,500 and $7,700. In the short term, however, it is difficult to imagine larger price declines while halving is just a few days away.

Bitcoin CME Future CoT-report, Source: Barchart

Since the high on February 13th at just under $10,500, there have been significant shifts in the bitcoin futures market. The so-called "leveraged funds" were ideally positioned with an extraordinarily high short position for the crash in mid-March. Since the low below $4,000, this group of market participants has quickly started to cover their shorts and recently achieved an almost neutral position. In the latest price increase above $9,000, however, the "leveraged funds" have again slightly expanded their short position.

The subgroup of the so-called "Other Reportables" had distinguished itself with a very successful countercyclical approach over the past two years. This time, however, this group entered the correction rather procyclically with a high long position. In the meantime, however, a rather neutral position has also been achieved here.

Despite the wild movements, the current CoT report is again neutral. None of the trader groups is currently taking an extreme position. Noticeable is the significantly increased "open interest", which has more than doubled compared to the December lows.

Bitcoin Optix as of May 6th, 2020. Source: Sentimentrader

Crypto Fear & Greed Index as of May 6th, 2020. Source: Crypto Fear & Greed Index

Crypto Fear & Greed Index as of May 7th, 2020. Source: Crypto Fear & Greed Index

In the short term the mood for bitcoin seems a little bit too optimistic as the Bitcoin Optix of Sentimentrader has measured extreme values for the first time since mid-February. In the medium and longer term, however, no exaggeration can be detected in sentiment. Rather, the sophisticated "Fear & Greed Index" is still sitting in its neutral zone with a recent value of 49.

In summary, sentiment provides a warning signal in the very short term. However, in the bigger pictures the mood in the crypto world is far from being a big party, therefore any pullback in bitcoin should represent another buying opportunity. The "sentiment analysis module" thus produces the recommendation "buy the next dip".

Bitcoin seasonality. Source: Seasonax

Based on the evaluation of the last nine years, bitcoin has developed a fairly clear seasonal pattern, which certainly is a useful tool for general timing. In fact, this statistical pattern seems to be working quite well so far this year as bitcoin started a new wave up in mid of March. According to the seasonal pattern, this rally could extend into June, before a corrective wave would take place over the summer months.

The seasonal component has been favorable since the end of February and supports rising bitcoin prices into early summer.

Sound Money Bitcoin/Gold-Ratio as of May 4th, 2020. Source: Chaia

Currently, you have to pay 5.74 ounces of gold for one single bitcoin. In other words, one troy ounce of gold currently costs only 0.174 bitcoin. Based on the numbers, bitcoin has hardly moved against gold since the beginning of this year. Nevertheless, in the last four months there have been strong movements in favor of both, gold and bitcoin. At the moment bitcoin has the tailwind again and is heading for the downtrend line of the last two and a half years. If there is an upward breakout from the triangle formation, the crypto winter should definitely be over for good and bitcoin should begin its journey towards its all-time highs at $20,000.

Generally, buying and selling Bitcoin against gold only makes sense to the extent that one balances the allocation in the two asset classes! At least 10% and a maximum of 25% of one's total assets should be invested in precious metals physically, while in cryptos and especially in Bitcoin one should hold at least 1% and a maximum of 5%. If you are very familiar with cryptocurrencies and Bitcoin, you can certainly allocate higher percentages to Bitcoin on an individual basis. For the average investor, who is normally also invested in equities and real estate, 5% in the highly speculative and highly volatile bitcoin is already a lot!

From a spiritual point of view, think of bitcoin and gold as another expression of our dualistic world. As we have sun and moon, summer and winter, warm and cold all representing various forms of Yin and Yang, it also makes sense to have an analog safe haven (gold) and a digital safe haven (bitcoin) in the 21st century. You want to have both!

In the longer term, the events of the last two and a half months are without any doubt extremely bullish for bitcoin. A brutal wave of insolvencies could not only turn our economic world upside down, but also fundamentally change the entire financial system! The biggest stimuli ever seen from governments and central banks have already shaken confidence in the fiat money systems to their very foundations. More and more people are realizing that government and money must be separated and that fiat money systems are responsible for the unfair distribution of opportunities and the unrestrained and undisciplined waste of the planet's natural resources.

Holger Zschaepitz @Schuldensuehner, 5th of May 2020

In addition to this already bullish mixture, the 3rd bitcoin halving will happen in just a few days. The first two bitcoin Halvings were each followed by an extreme rally and increases of 10,000% and 2,500% within one to two years!

Tavi Costa @Crescant Capital, April 29th 2020

However, a further deflationary phase in the markets cannot yet be completely ruled out. In fact, the situation is far too complex to blindly bet on inflation and hyperinflation at this stage. Recently, central banks have significantly reduced their support measures, even though well over $50 trillion have been destroyed worldwide by the corona crash. At the same time the money supply expansions could be sufficient to send gold and bitcoin into the stratosphere. But another deflationary wave or crash in the equity markets would affect gold and bitcoin too. On top, Gold and bitcoin are overbought and don't deliver a good risk reward ratio in the short-term. Yes, any dip or pullback in these two markets needs to be bought!

Overall, Bitcoin is making a strong impression these days. The breakout above the two resistance lines seems indeed to be successful and prices have reached $10,000. From here, bitcoin only needs to double to reach its all-time high. Anyone who has studied bitcoin knows how quickly a 100% rise can happen.

Nevertheless it is important to proceed carefully and patiently. On the way up, there will always be setbacks and thus also buying opportunities. Such a one would already represent itself with a possible pullback towards $7,700 at any time.

Disclosure: I am/we are long BTC-USD.

See more here:
Bitcoin - Breakout In Progress - Seeking Alpha

In brief:

Digital asset manager Grayscale now boasts a total of $3.7 billion worth of Bitcoin, Ethereum, and several other cryptocurrencies under managementmarking an all-time high for the firm. These funds are held on behalf of its investors.

This latest update represents a $500 million increase in Grayscale's total AUM since its Q1 report published March 31, 2020. In fact, in a little under a year, Grayscale added $1 billion (37%) to its total assets under management (AUM), with the firm reporting $2.7 billion AUM in July 2019.

First arriving on the scene in 2013, with the Grayscale Bitcoin Trust, the asset manager has amassed a huge amount of cryptocurrency since. Heavily focused on Bitcoin to begin with, the firm eventually diversified into several additional large-cap cryptocurrencies.

Yet Grayscale still retains the vast majority of today's holdings in its Grayscale Bitcoin Trust, which maintains $3.3 billion worth of Bitcointhe equivalent of 89.1% of total AUM.

As reported by Decrypt, Grayscale, along with Square's bitcoin payments processor, CashApp, bought up an amount of Bitcoin equivalent to half of all newly minted Bitcoin in Q1 of 2020.

A vast chunk of Grayscale's remaining allocated funds lies in the Grayscale Ethereum Trust, with the second-largest cryptocurrency claiming $279 million, or 7.5% of Grayscale's AUM.

This institutional demand for ETH appears to be a growing trend. 2020 has been a particularly good year for the Ethereum Trust, with the firm boasting over $110 million in ETH inflows in the first quarter of 2020 alone. This is increasing at a much faster rate than the previous two years, which saw inflows at an average of $12 million per quarter.

But will investors be in it for the long run or is this all just a bet on the halving?

More here:
Grayscale holds $3.7 billion and its nearly all Bitcoin - Decrypt

A crypto data firm representative explained how Tethers on chain data can potentially forecast Bitcoins (BTC) bull runs.

Marketing and social media director at Santiment, Brian Quinlivan, told Cointelegraph on May 7 that the percentage of USDT held on exchanges often anticipates Bitcoins bull runs. He explained the principles behind the analysis:

Most USDT isn't just being taken off exchanges to be stored in wallets or cashed out through a FIAT-based platform like Coinbase. When people aren't using USDT, they most often put it in Bitcoin. And what's cool is the fact that this USDT percentage often fluctuates a few hours or days in advance of BTC's price reacting to it. So monitoring this metric in advance can end up producing a tremendous advantage by catching a sudden fluctuation early enough.

Quinlivan pointed out that this correlation started a couple of years after USDT launched, once the stablecoin gained traction. Now, he explained that Tether is clearly utilized as the top price-stable token. He also states that he is confident this correlation will continue to manifest itself in the future. Quinlivan noted that the one year chart has shown a distinct and clear inverse correlation for the past 9-10 months.

Bitcoin price-portion of Tethers USDT on crypto exchanges chart. Source: Santiment

Quinlivan also pointed out a relationship between the amount of decentralized stablecoin, DAI, on crypto exchanges and Ether (ETH) price. He explained:

The amount of supply of DAI on exchanges often seems to lead the way in Ethereum's price. However, this is a bit less consistent than the BTC-USDT tie, since ETH's price is more reliant on what BTC is doing at any given time.

Lastly, the data firm rep acknowledged that other metrics are worth looking at as well. He specifically mentioned an interest in social trends, such as keywords and topic mentions on various social platform conversations. He said that over the past couple of months the firm observed the fear related to COVID-19 has had a direct inverse correlation to the price of BTC.

After a major downturn in March, Bitcoin is now increasingly showing bullish signs. As Cointelegraph reported earlier today, institutional investors appear to expect a Bitcoin bull run, given that futures on the Chicago Mercantile Exchange recently broke records.

Renewed interest in the leading cryptocurrency is also often attributed to the upcoming halving of Bitcoins block reward halving. This interest is not equally distributed and Cointelegraph recently analyzed which countries are the most interested in the event.

Read more from the original source:
Tether Held on Exchanges Could Help Forecast Bitcoin Bull Runs - Cointelegraph

Bitcoin, a digital currency designed as an alternative to state-backed fiat money, was created in the midst of the 2008 global financial crisisbut no one knows who made it.

The bitcoin price has been climbing steadily over the last decade, making many early adopters overnight millionaires and causing millions more to ask: Who is bitcoin's creator, someone known only as Satoshi Nakamoto?

Now, amid a surge in bitcoin interest sparked by the global coronavirus pandemic, the eccentric cyber security pioneer John McAfee claims to know the answer. But of course, he's not telling.

John McAfee, the cybersecurity pioneer-turned U.S. presidential hopeful, claims to know the identity ... [+] of bitcoin's mysterious creator--but he's not telling.

McAfee, the outspoken antivirus software developer-turned curveball U.S. presidential candidate, says he's 99% sure he knows the identity of Satoshi Nakamotothe author of the bitcoin white paper, thought to be a pseudonym.

"It was a team of eleven people over a period of five years, that came up, eventually, with [bitcoin]," McAfee told bitcoin and cryptocurrency website Cointelegraph on the virtual sidelines of a now digital blockchain conference, forced online due to the coronavirus pandemic, adding he thinks Craig Wright, a computer scientist who's repeatedly claimed to be bitcoin's creator but failed to produce proof, was involved.

"How they decided who would write the paper, I dont know. But anybody who wants to know who it isI mean, you know who the options are, you've got Craig Wright possibly, I'm not going to name everyone else otherwise youll figure out who it is, but somebody wrote the white paper."

McAfee pointed to two language quirks as helping to narrow down the potential developers: That the author used British English over American English and consistently used two spaces after a period.

McAfee also claimed "the format of the document was identical to documents that [Satoshi Nakamoto] had published professionally"making it relatively easy for anyone to figure out.

"If you buy a two-hundred dollar authorship program, and you take the white paper and you run it through, and you take any one of the papers that hes publishedall of these people wrote papers by the way, only one comes out with ninety-nine percent probability it's him."

Despite that, McAfee said he doesn't want to reveal who exactly wrote bitcoin's white paper, as he fears he could "end up destroying an innocent mans life forever, and probably cause his death."

"I have spoken to him on the phone, I was actually going to divulge who he was," McAfee said, adding the author of bitcoin's white paper convinced him not to reveal it.

McAfee reportedly labelled the coronavirus pandemic a government conspiracy while waving around an AK-47 rifle before making his comments about Satoshi Nakamoto's true identity.

Earlier this year, McAfee reneged on his promise to "eat [his] own dick on national television" if the bitcoin price didn't hit $500,000 per bitcoin by the end of 2020, calling bitcoin "ancient technology" and lending his support to privacy-focused cryptocurrency monero.

John McAfee, whose personal fortune is thought to have peaked at around $100 million just ahead of ... [+] the 2008 financial crisis, has long been a fan of cryptocurrencies but has recently criticized bitcoin, calling it "worthless."

The true identity of bitcoin's creator, or group of creators, has become one of the internet's most tantalizing mysteries, with many tryingand so far failingto crack it.

In 2014, the U.S. magazine Newsweek claimed a Japanese American man living in California, Dorian Prentice Satoshi Nakamoto, was the bitcoin inventor. A claim he subsequently denied and one that has now been widely disregarded.

Others, such as cryptographic pioneer and the first person to receive a bitcoin transaction, Hal Finney, have been named as possibilities. Forbes put that question to Finney in the months before he died.

Bit gold creator Nick Szabo and bitcoin developer Gavin Andresen have also been linked to the name Satoshi Nakamoto.

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John McAfee Thinks Hes Solved Bitcoins Greatest MysteryWho Is Satoshi Nakamoto? - Forbes

Bixin, one of the earliest bitcoin miner operators and wallet startups, is dedicating 6,600 bitcoin, worth $66 million, to a new fund of funds.

The company announced the fund of funds with its proprietary capital on Friday, and said it aims to invest in global quantitative trading funds whose strategies are based on arbitrage, bitcoin futures contracts and trend analysis.

By providing additional liquidity and market-making activities to these trading desks amid bitcoin's scheduled halving event, Bixin seeks to increase its holdings in bitcoin as part of its "unwavering commitment to bitcoin," the firm said in the announcement.

"We are strong believers in bitcoin and it's not what we want to see that the bitcoin ecosystem in China and elsewhere are in a silo," said Liu Fei, who joined Bixin from the Huobi exchange in late 2018 and now oversees Bixin's mining business and the fund of funds. "We hope the fund of funds can contribute to a better global liquidity structure for the bitcoin ecosystem."

Founded in 2014 by Wu Gang, who started mining bitcoin since as early as 2009, Bixin has become one of the most known bitcoin wallet and mining pool operators in China.

It scaled up the investment in bitcoin self-mining in the late 2018 and early 2019 bearish market and is currently operating bitcoin mining facilities of about 300 megawatt-hour, roughly 3,000 petahashes per second (PH/s) of computing power that accounts for 2.5% of the Bitcoin network's total.

Bixin established an investment and financial service arm around 2018 with its own capital and has invested in leading crypto startups in China including MicroBT, a serious contenders against mining giant Bitmain's dominance in bitcoin miner hardware business.

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One of Bitcoin's Earliest Miners Is Dedicating $66M in Crypto to a Fund of Funds - CoinDesk