Category Archives: Bitcoin

The host of Mad Money, Jim Cramer, has predicted that bitcoins price will fall to $12,000. Nonetheless, he has recommended bitcoin and ether for people wanting to invest in crypto.

Jim Cramer, the host of Mad Money, talked about the future outlook for bitcoin on CNBC Friday. Cramer is a former hedge fund manager who co-founded Thestreet.com, a financial news and literacy website.

He was asked whether he thinks bitcoin is going to bounce from the current level, or whether BTC will go down another 50% or more.

Sharing his bitcoin price prediction, he replied:

I think it goes to $12,000, where it was before this whole fiasco began.

I think the people involved with bitcoin have to take another stand, the Mad Money host stressed. We need some guys to just say, Look this is the level. Thats typical of what happens when its about to really drop big. He emphasized, They cant let it go down anymore.

Cramer proceeded to talk about Microstrategy, the Nasdaq-listed software company that has amassed 129,218 BTC on its balance sheet. Its CEO, Michael Saylor, is a bitcoin bull. He was recently on CNBC talking about bitcoin being the best investment for his company and it is a good time to buy BTC at the current level.

Microstrategy recently debunked the rumor that it is facing a margin call for a bitcoin-backed loan from Silvergate Bank and will need to liquidate some BTC. Saylor explained that the company has more bitcoin to pledge and other collateral to post for the loan.

However, Cramer said if the lender changed the margin rates on crypto, Saylor would be out in a second.

Bitcoin plummeted early Saturday morning, falling below $20K for the first time since 2020. At the time of writing, BTC is trading at $17,983, down 13% over the past 24 hours and almost 40% over the last seven days.

The Mad Money host tweeted Saturday:

Ten percent down for bitcoin and you get some nasty margin calls over the weekend Amazing that there are no big institutions propping this up.

He added in a follow-up tweet: I wonder what rabbit Michael Saylor can pull out of a hat with his Microstrategy gameplan. I wonder when he first raised money if he had this in mind.

Earlier this month, Cramer gave some advice on cryptocurrency investing. He admitted that he owns ethereum, adding: I would never discourage you from buying crypto. However, he said: I would prefer that you would do it in ethereum or bitcoin, which have the largest followings.

In October last year, he said: The whole investment case for crypto rests on the Greater Fool Theory. Microsoft co-founder Bill Gates made a similar comment this week that crypto is 100% based on the Greater Fool Theory, emphasizing that he is not involved in it.

Cramer is not the only one predicting a massive fall in the price of bitcoin. Billionaire fund manager Jeff Gundlach said this week that he wouldnt be surprised at all if BTC falls to $10K. Rich Dad Poor Dad author Robert Kiyosaki indicated that BTC could bottom out at $9K. Guggenheim Chief Investment Officer Scott Minerd said last month that BTC could fall to $8K.

What do you think about Jim Cramers prediction? Let us know in the comments section below.

A student of Austrian Economics, Kevin found Bitcoin in 2011 and has been an evangelist ever since. His interests lie in Bitcoin security, open-source systems, network effects and the intersection between economics and cryptography.

Image Credits: Shutterstock, Pixabay, Wiki Commons

Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.

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Mad Money's Jim Cramer Expects Bitcoin to Fall to $12,000

Bitcoin continues to trade around the $20,000 mark, keeping investors on edge about where the price is going next.

Nurphoto | Getty Images

Bitcoin jumped on Monday, after the cryptocurrency fell below its 2017 high over the weekend, but investors remained on edge thanks to a slew of negative crypto headlines and macro factors keeping pressure on sentiment.

The world's largest cryptocurrency by market cap climbed above the $20,000 mark for much of the day Monday. However, it last edged lower by 1.2% to $19,840.89, according to Coin Metrics. Over the weekend, bitcoin fell as low as $17,601.58. Meanwhile, ether slipped by 1% to $1,088.41.

While investors will welcome the rebound, bitcoin still sits 70% below its all-time high, hit in November. It's down 57% year-to-date. Many have suggested a market bottom could be close, but with so much economic uncertainty remaining, bitcoin still has more downside potential, according to Yuya Hasegawa, a crypto market analyst at Japanese bitcoin exchange Bitbank.

"Bitcoin's weekend dip was, to put it simply, not deep enough," he said. "The macro environment has not really changed from last week's FOMC meeting: there still has not been a clear sign of inflation coming down and the Fed may still drive the economy into recession by raising rates too aggressively or simply by failing to tame inflation."

With bitcoin unable to hold convincingly above $20,000, industry watchers said the rally might be short-lived.

Vijay Ayyar, vice president of corporate development and international at crypto exchange Luno, told CNBC that unless the price of bitcoin closes above $23,000 on a daily time frame basis, "the odds are this is a dead cat bounce."

"We're oversold, so a bounce was expected," he added.

The broader cryptocurrency market has been plagued by a number of issues in recent weeks, beginning with the collapse of algorithmic stablecoin terraUSD and associated token luna.

Attention has now turned to crypto lending companies that promise users high yields for depositing their digital coins. Last week, Celsius, a company with 1.7 million customers and nearly $12 billion of crypto assets under management, paused withdrawal of funds for customers, sparking concerns that it is insolvent.

Cryptocurrency companies have announced rounds of layoffs amid the market downturn. Coinbase, a crypto wallet and exchange, said last week it will cut 18% of full-time jobs. A lending firm called BlockFi said last week it will lay off a fifth of its staff.

Macroeconomic factors including high inflation and upcoming rate hikes from the U.S. Federal Reserve are also weighing on the market.

"When inflation is on the doorstep and with rate hikes in the offing, the risks of a recession round the bend are high," Charles Hayter, CEO of CryptoCompare, told CNBC via email.

"The push me pull you of higher rates sapping cash from mortgaged house owners means people are psychologically bracing and paring back and digital assets are suffering thus."

"Coupled with this, the pull back in the digital asset ecosystem has uncovered a number of systemic issues."

Given the big fall in cryptocurrency prices in the last few weeks, some observers said that a bottom to the market could be close.

Giles Keating, director of Bitcoin Suisse, told CNBC's "Squawk Box Europe" on Monday that "we're close to a point where some of the real excess leverage has now been driven out of the system and a bottom can begin to be formed."

Leverage refers to trading in which investors effectively use borrowed money to make trades. That means investors can get larger exposure to positions with less initial capital. But that's seen as a risky means of trading as it requires investors to ensure they have enough capital to meet the so-called margin requirements. If they don't, their position is automatically liquidated. Those liquidations are seen as a big factor behind market moves.

Keating said there is still a risk of further liquidation, but he thinks the majority of the selling is over.

"Now some people are warning that we are still not yet there and that if we were to break significantly lower, that we'd see another wave of liquidations," Keating said.

"There's always that risk hovering there. But my feeling, given I think those very very big double digit rebounds we saw, in bitcoin, particularly in ether, I think to my mind that was a sign that a lot of those really big liquidations are now done and that the base really is being formed."

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Bitcoin bounces back after falling to new 2022 lows over the weekend - CNBC

Bye-bye bear market blues; welcome to the network, Bitcoin (BTC) believers. Over the past week, the number of Bitcoin wallet addresses containing one BTC or more increased by 13,091. The total number of wholecoiners surged to 865,254.

The number of whole coiners has rocketed during the downward price action, highlighted by the hockey stick growth on the Glassnode graph:

Christian Ander, the founder of the Swedish Bitcoin exchange BT.CX told Cointelegraph that "This is good for the ecosystem that its growing from the ground up because want the economy to be bottom up. Ander continued:

Over the past 10 days, since May 10 market slump to $30,000, over 14,000 whole coiners have joined the network. As there will only ever be 21 million Bitcoin mined, each of these wallet addresses will own 1/21,000,000 of all Bitcoin.

At an approximate price of $20,000 per Bitcoin, the sharp increase in the number of whole coiners would suggest that retailor plebs as they are affectionately knownare buying Bitcoin as fast as their incomes will allow. The number of addresses adding 0.1 BTC ($2,000) or more has also begun a parabolic run over the past 10 days.

In contrast, the number of wallets containing more than 100 BTC has dropped by136 over the same period. By inference, "whale" wallets (large BTC wallet addresses) could be unloading their bags.

Related: El Salvador president addresses bear market concerns with Bitcoin hopium

When Satoshi Nakamoto mined the first Bitcoin on Jan. 9, 2009, the Gini coefficient was 1, i.e., the income inequality on the network was the highest it has ever been. The Gini coefficient, developed by statistician Corrado Gini, represents income inequality or wealth inequality within a social group. In Bitcoin, it can be mapped onto wallet addresses.

As soon as Hal Finney, the first Bitcoin believer began mining and receiving Bitcoin, the Gini coefficient dropped from 1. It has trended lower and lower ever since, indicating that the wealth distribution on the Bitcoin network is becoming fairer and fairer.

As for Ander, he told Cointelegraph that he "stacked some more SATs yesterday!"

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Bitcoin mints more than 13,000 'wholecoiners' in the past seven days - Cointelegraph

The chief executive officer of blockchain technology company Blockstream says that leading digital asset Bitcoin (BTC) could see a 5x increase in price by the end of the year.

Adam Back tells his 481,600 Twitter followers that he expects the U.S. Federal Reserve to reverse its tight monetary policies before 2022 expires and create a macro environment conducive to the growth of Bitcoin.

Everyone has their pet macro-views. My guess: stock market + US election season, moral hazard kicks up, quantitative easing ramps up again, rates drop again, money printer goes into overdrive. So the interest rate overhang falls off, and BTC decorrelates somewhere along the way once DeFi (decentralized finance) flushed.

On top of a favorable macro backdrop, Back says the approval of the much-awaited spot Bitcoin exchange-traded fund (ETF) could leave many bears on the sidelines.

My permabull case for BTC/USD [is] $100,000 this year. Plus a US physical Bitcoin ETF chaser (GBTC upgrade + other) would create a nice whipsaw and probably trigger a big uncoupling and positive reflexivity into a blow off top next year.

Back warns traders against taking leveraged positions, especially now that theres a lot uncertainty surrounding the DeFi space.

But what do I know? Just dont use leverage, and most particularly, not while the DeFi contagion works out. If you dont have leverage you can just buy and hold and wait so timing matters not. Im a permabull. So I keep buying as I can afford. And hold. It works long-term.

Bitcoin is changing hands at $20,051 at time of writing, a 9.94% increase on the day.

Featured Image: Shutterstock/Mia Stendal

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Bitcoin (BTC) Will Whipsaw Traders to $100,000 This Year, Says Blockstream CEO Adam Back Heres How - The Daily Hodl

Like clockwork, the onset of a crypto bear market has brought out the Bitcoinis dead crowd who gleefully proclaim the end of the largest cryptocurrency by market capitalization.

The past few months have indeed been painful for investors, and the price of Bitcoin (BTC)has fallen to a new 2022 low at$17,600, but the latest calls for the assets demise are likely to suffer the same fate as the previous 452 predictions calling for its death.

Resolute Bitcoiners have a bag full of tricks and on-chain metricsthey use to determine when BTC is in a buy zone, and now is the time to take a closer look at them. Lets see what time-tested metrics say about Bitcoins current price action and whether the 2021 bull market was BTCs last hurrah.

One metric that has historically functioned as a solid level of support for Bitcoin is its 200-week moving average (MA), as shown in the following chart posted by market analyst Rekt Capital.

As shown in the area highlighted by the green circles, the lows established in previous bear markets have happened in areas near the 200-MA, which has effectively performed as a major support level.

Most times, BTC price has had a tendency to briefly wick below this metric and then slowly work its way back above the 200-MA to start a new uptrend.

Currently, BTC price is trading right at its 200-week MA after briefly dipping below the metric during the sell-off on June 14. While a move lower is possible, history suggests that the price will not fall too far below this level for an extended period.

Along with the support provided by the 200-week MA, there are also several notable price levels from Bitcoins past that should now function as support should the price continue to slide lower.

The last time the price of BTC traded below $24,000 was in December 2020, when $21,900 acted as a support level that Bitcoin bounced off of prior to its run-up to $41,000.

Should support at $20,000 fail to hold, the next support levels are found near $19,900 and $16,500, as shown on the chart above.

Related: Too early to say Bitcoin price has reclaimed key bear market support Analysis

One final metric that suggests BTC may be approaching an optimal accumulation phase is the market-value-to-realized-value ratio (MVRV), which currently sits at 0.969.

As shown on the chart above, the MVRV score for Bitcoin has spent most of the time over the past four years above a value of 1, excluding two brief periods that coincided with bearish market conditions.

The brief dip that took place in March 2020 saw the MVRV score hit a low of 0.85 and remain below 1 for a period of roughly seven days, while the bear market of 2018 to 2019 saw the metric hit a low of 0.6992 and spent a total of 133 days below a value of 1.

While the data does not deny that BTC could see further price downside, it also suggests that the worst of the pullback has already taken place and that it is unlikely that the current extreme lows will persist for the long term.

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.

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Bitcoin critics say BTC price is going to $0 this time, but these 3 signals suggest otherwise - Cointelegraph

Shark Tank star Kevin OLeary, aka Mr. Wonderful, says he is not selling any of his cryptocurrencies despite the crypto market downturn. Long term, you just have to stomach it. You have to understand youll get volatility, he stressed.

Shark Tank star Kevin OLeary talked about bitcoin and other cryptocurrencies in an interview with the Insider, published Saturday.

Commenting on the crypto market turmoil, OLeary said:

Im not selling anything Long term you just have to stomach it. You have to understand youll get volatility, and that some projects arent going to work.

OLeary currently holds 32 positions in the digital asset space, the publication conveyed. He is also a strategic investor of Wonderfi Technologies. The crypto platform received conditional approval to list its shares on the Toronto Stock Exchange (TSX) last week.

In an interview with Bankless, published last week, OLeary said that his largest holdings right now are ethereum and bitcoin. However, he added, I also have a big position in USDC [and] a big position in FTX as an equity. He additionally mentioned polygon and solana. Emphasizing the importance of diversification, he said about eight weeks ago his crypto holdings were approximately 21% of his portfolio. Now, its down to about 18%, he said, elaborating:

Theres been a big correction in the market but youve got to hold your nose and get used to the volatility.

The Shark Tank star explained that the recent crypto collapses, such as the implosion of cryptocurrency terra (LUNA) and algorithmic stablecoin terrausd (UST), provide valuable lessons to investors.

The demise of UST educated everybody that this isnt the way to build a stablecoin, he said, emphasizing that Its important for the education and the maturation of the market.

OLeary added that the collapse of a crypto token does not have a big impact on global financial markets. He opined:

Its nothing, a rounding error in the context of a sovereign wealth. Its bad for investors, but theyve educated the market on what not to do. Its a good thing.

Mr. Wonderful has been saying that trillions of dollars will flood into crypto when we get policy and the regulator regulates. He also believes that crypto will be the 12th sector of the U.S. economy within 10 years.

What do you think about the comments by Kevin OLeary? Let us know in the comments section below.

A student of Austrian Economics, Kevin found Bitcoin in 2011 and has been an evangelist ever since. His interests lie in Bitcoin security, open-source systems, network effects and the intersection between economics and cryptography.

Image Credits: Shutterstock, Pixabay, Wiki Commons

Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.

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Kevin O'Leary Says He Won't Sell Any Crypto Despite Downturn 'You Just Have to Stomach It' Markets and Prices Bitcoin News - Bitcoin News

The crypto winter is here. Its a trying time as prices grind down, but its the best moment to build and learn. For some Bitcoiners, the bear market is a time to plant treesor create memes. For those with kids, its a welcome recess used to broaden the minds of Bitcoin (BTC) minors.

Cointelegraph spoke to the creators of popular Bitcoin-related games and educational tools to understand why teaching kids about sound money is critical, and some of the best ways of doing so.

SHAmory, a portmanteau of SHA-256 (the cryptographic function that hashes inputs in Bitcoin) and memory, is among the best-selling Bitcoin games. Targeted at kids aged four and over, creator Scott Sibley shared that he had his toddler in mind for both the creation of the game and book.

Sibley and his wife also thought up Goodnight Bitcoin,part of a burgeoning bookshelf of Bitcoin-related books. A passionate educator, Sibley told Cointelegraph that breaking the money taboo and educating kids about finance is critical:

Sibley suggested that kids seeing, interacting with and recognizing something as simple as the Bitcoin logo or even playing our game and then asking how Bitcoin mining works, is key for long-term adoption. Plus, the Gen-Z the Zoomer generation has a headstart understanding intangible digital products: Transacting in Bitcoin is going to be no different than buying a new skin or level in a video game they are currently playing.

Will Reeves, co-founder of Fold App a Bitcoin rewards debit card co-founded the Bitcoin gameBitopoly. Reeves told Cointelegraph that the first version of Bitopoly emerged from a conversation around a dinner table in which we were attempting to teach friends and family members about Bitcoin. He said:

Much like Sibley, Reeves explained that the best thing for Bitcoin adoption is teaching children, especially as they have no preconceived notions.

Kids do not approach Bitcoin with a lifetime of preconceived notions, thus they are able to understand it faster and with less pushback against their own bias, he said.

In comments that may ring true for adult readers, Reeves said that Bitcoin is a hard process of unlearning their previously held thoughts and understandings about what money is.

MTC, the founder of Sats Ledger, told Cointelegraph, I wanted to share Robert Breedlove and other Bitcoiners, with his young family. As a Bitcoin influencer and freedom maximalist, he knows that realistically, no five-year-old would sit through a one-hour Breedlove podcast that waxes lyrical about sound money, libertarian first principles and the evolution of the tax system.

MTC reflected on his own childhood, during which he really liked to save. He remembered the savings books that he would diligently fill out, watching his wealth grow. Combine that with the fact that kids dont like being cheated out of things, and mine is one of the first concepts that a kid understands, and Sats Ledger was born.

MTC said Sats Ledger is a fun, physical savings book for kids to log their Satoshi savings, money that nobody can take from them.

With Sats Ledger, kids get to grips with Bitcoin and money learning how to HODL using a low-time preference. MTC told Cointelegraph, If you can encourage kids to see their savings growing then it puts them on the path to understanding sound money and Bitcoin.

Another childhood saver, Pigtoshi Nakamoto, hatched a Bitcoin twist on the premier childhood saving device the piggy bank. The BitPiggy works with OpenDime, a Bitcoin USB stick that allows people to spend Bitcoin-like dollar bills, to teach kids how to save some or all of their money in Bitcoin.

Pigtoshi told Cointelegraph, I figured it out early that if I saved early in life then things would get easier later in life. Especially when youre young. Its when youre young, thats when you can get ahead. They have since partnered with Sibley from SHAmory, so more toys and games could be on the horizon.

In the United Kingdom, Bitcoiner Coach Carbon has taken the beautiful game of soccer and combined it with Satoshi Nakamotos invention. A life and health coach and lifelong soccer fan Coach Carbon founded Bitcoin Ballers academy, where kids work to combine proof-of-work, personal responsibility and fighting the FUD in a footballing journey, he told Cointelegraph.

Bitcoin Ballers soccer training exercises include 51% attack; a training game called getting off zero and difficulty adjustments within certain training exercises where defenders are added or the pitch size is boxed in. For Coach Carbon, its not just about promoting Bitcoin:

Fundamentally, given that the Bitcoin network is barely a teenager just two countries out of a possible 195 have formally adopted Bitcoin and global adoption rates sit at less than 1%, hyper-Bitcoinization (when Bitcoin becomes the global store of value), is a distant prospect. As the educators explained, exposure to Bitcoin from a young age is another small step on that path.

Related:Is education the key to curbing the rise of scammy, high-APY projects?

Moreover, an unexpected upshot to educating children about sound money is the knock-on effect it has on parents. Reeves concluded that teaching children about Bitcoin is one of the most efficient strategies for accelerating the adoption of Bitcoin.

Whereas for Sibley, games, books, and educational tools are a stealth way of orange-pilling people, notably the parents.

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From games to piggy banks: Educating the Bitcoin minors of the future - Cointelegraph

The chief investment officer of global fixed income at Blackrock, the worlds largest asset manager, says bitcoin and crypto are durable assets. I think theres a healthy recalibration going on, he said, noting that if you look two to three years hence, they will be higher than today.

Rick Rieder, chief investment officer (CIO) of global fixed income at Blackrock, shared his view on bitcoin and cryptocurrency in an interview with Yahoo Finance Live on Thursday. Blackrock is the worlds largest asset manager with about $10 trillion in assets under management (AUM).

Rieder was asked how the crypto market is going to react as the Federal Reserve begins tightening aggressively. The Fed hiked its benchmark rate by 75 basis points this week the largest increase since 1994.

The CIO explained: I think people underestimate. When you leave rates at such low levels for such an extensive period of time when you keep policy too easy, the leverage builds in the system slash how do I capture return quickly and you are seeing a lot of the leverage that was built up around crypto come unglued pretty darn quickly.

However, he emphasized:

I still think bitcoin and crypto are durable assets. Its a durable business, but there was so much excess built around it.

Rieder described: Its not terribly dissimilar from the internet bubble if you go back to the 99 and 2000, was the internet a bad idea? No, it wasnt a bad idea. But you created so much excess around it and you just have to de-gear that dynamic, and I think we are seeing that today. He noted: Markets go down five times faster than they go up Thats why you were seeing this incredible unwind.

While reiterating that he still thinks bitcoin and crypto are durable assets that are going to go on, the Blackrock executive opined:

I think theres a healthy recalibration going on. Its a question of how much that recalibration is going to go.

When asked about the prices of major cryptocurrencies, he admitted that for crypto: Its pretty hard when there is no true intrinsic value. So, what is it worth? Its worth what the next person will pay.

He continued: My sense is, in all these situations, you overshoot, and my guess is you have probably got some downside to go from here. But its hard to say what fair value is. The Blackrock chief investment officer further shared:

My sense is like a lot of assets, if you look two to three years hence, they will be higher than today.

But it could overshoot on the downside. This is hard to figure out, just like gold, because I cant figure out my free cash flow multiple and what my security is underneath it, he concluded.

Rieder has made some pro-bitcoin comments in the past. In November 2020, he said cryptocurrency is here to stay, noting that bitcoin could replace gold. He also said BTC is so much more functional than passing a bar of gold around. In September last year, he revealed that he owns a small piece of bitcoin, emphasizing: I like assets that are volatile that have upside convexity. I could see bitcoin go up significantly.

What do you think about the comments by Blackrocks chief investment officer? Let us know in the comments section below.

A student of Austrian Economics, Kevin found Bitcoin in 2011 and has been an evangelist ever since. His interests lie in Bitcoin security, open-source systems, network effects and the intersection between economics and cryptography.

Image Credits: Shutterstock, Pixabay, Wiki Commons

Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.

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Blackrock's CIO: Bitcoin and Crypto Are Durable Assets Prices Will Move Higher Markets and Prices Bitcoin News - Bitcoin News

What is BOLT 12? Well, it is a lot of different features and moving pieces put together to accomplish multiple different things static QR codes, modular invoices, privacy for the person receiving the payment.

But what is the whole package? It's a way to have a single QR code, an "offer," allow you to grab invoices from a node in a privacy preserving way, while also allowing for things like requesting that a remote node pay your invoice.

Now, anyone familiar with LNURL should already be thinking, This sounds a lot like LNURL. But for those of you who don't know what LNURL is or how it works, here's a quick breakdown.

LNURL is a stack of simple protocols for coordinating information needed to make payments over the Lightning Network using HTTP. The full list of LNURL protocol pieces can be found here, but I'm just going to go into a few core uses that overlap with BOLT 12.

Three core pieces of the LNURL protocol are an authentication scheme, where a public key can be used to log in to a service, an invoice request scheme where a wallet can ping a server through a static QR code and retrieve an invoice, and a withdraw request scheme where a wallet can ping a server and request that the server pays an invoice provided by the wallet. Lightning invoices are much longer than on-chain Bitcoin addresses, the payment itself is already an interactive process requiring both parties to be online, so coordinating payment details interactively over a network connection makes sense.

The authentication protocol is effectively just the server providing a randomly generated number which the users wallet signs with a newly generated key. After the signed random value is received by the server, it saves the associated key to be used in future logins.

The invoice request functionality is a way to provide information to a user about a payment they wish to make in a format that is not an invoice. This provides a description of the payment, the minimum and maximum amount the service expects to be paid, and a URL for the wallet from which to request an actual invoice. From here, the wallet displays this information to the user, allowing them to set a final amount and request an invoice. After sending the invoice request and receiving one back from the server, the wallet verifies that the amounts match what the user set and pays the invoice.

The withdrawal request works by pinging the service, and receiving in response a description, a URL to send an invoice to, a random string (or deterministic to tie to an account or user), and a minimum amount and maximum amount that can be withdrawn. After filling in the appropriate value, the wallet returns an invoice to the server, and if it is valid and within the amount parameters, the service pays the invoice. The LNURL authenticate protocol can be used in addition to this to ensure that only the intended user can successfully withdraw using the LNURL link.

LNURL has smoothed over and improved much of the UX experience around using the Lightning Network, but it requires the use of a web server in order to be utilized. All of the requests and responses are handled through HTTP, and additional infrastructure beyond the Lightning node itself is required to handle these streamlined ways of coordinating and making payments. This is a perfectly reasonable requirement for any online service provider or merchant, who is realistically going to need a web server anyway to provide their service or products online. However, for a non-technical end user at home who simply wants such a streamlined experience, a street vendor, a physical shop or other users who do not already require the use of a web server, this can be a burdensome and potentially risky requirement.

BOLT 12 offers an attempt to achieve some of the core functionality that LNURL provides without requiring the use of a web server. An offer encodes the data necessary to reach a node to request an invoice to make a payment, either a node_id, or a blinded path (the last few hops in an onion route, pre-computed and encrypted) to that node using onion messages. It also can encode a minimum amount for a payment, the currency being paid in, an expiry time and minimum/maximum quantity numbers (for purchasing multiple items).

This is all of the information necessary to fetch an actual invoice from the node that issued the offer. Someone who wants to pay an invoice does so over onion messages, one of the core features of BOLT 12. It allows nodes to make a direct, end-to-end-encrypted connection between each other that does not involve a Lightning channel. Just like Lightning payments, these can be used to onion route messages. After obtaining an offer, a payer will use the information encoded in it to send an invoice_request message. The creator of the offer will then respond back with an actual invoice.

There is also support for generating unique per user offers that allow the receiver to request a payment from the creator of the offer, similar to LNURL's withdrawal request feature. BOLT 12 invoices commit to a unique payer key this can be used in the case of issuing refunds to prove you are the person who actually paid the invoice. This can also be used in combination with the withdrawal offer to guarantee that only the correct person can succeed in getting an invoice paid by the creator, as opposed to whoever is able to get a copy of the offer.

These two uses of offers effectively fulfill the same functionality as the invoice and withdrawal requests of LNURL, without the need to run a web server.

LNURL and BOLT 12 both accomplish the same general functionality, so what is really the difference between them? What is the need for BOLT 12 if LNURL already exists? The key distinction is the web server. A web server requires running more infrastructure, a domain name, a TLS certificate and the expertise to manage these things.

While this is not an issue even worth mentioning for most businesses and services, as these things are needed to operate any online business in the first place, this is a big issue for your typical non-technical end user. It is not a reasonable expectation for a user to maintain extra infrastructure bolted on top of their Lightning node in order to have access to a streamlined and simple user experience. There is also the question of the centralization of DNS; a domain is not something that can ever be truly controlled by the owner.

These issues aside, both can co-exist. LNURL works just fine, and is already very widely adopted in the Lightning ecosystem, it is just not a realistic solution for users other than businesses or services. BOLT 12 as it is adopted can fill that gap, and provide the same streamlined user experience for end users at home who are not businesses.

Both solutions accomplish roughly the same thing for two different classes of users, and that is OK.

This is a guest post by Shinobi. Opinions expressed are entirely their own and do not necessarily reflect those of BTC Inc or Bitcoin Magazine.

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During the last week, while crypto markets got hammered, digital currency-centric over-the-counter (OTC) trading desks were swamped with orders. The cryptocurrency OTC trading desk Cumberland, a subsidiary of DRW, explained that on June 13, the firm saw 30% more volume than the previous year-to-date high on May 13.

Over-the-counter (OTC) trading desks allow high-net-worth crypto traders to trade coins without affecting spot markets as much as they would trading on a traditional exchange. OTC trading desks also provide liquidity for big buyers that smaller exchanges cannot provide. A number of companies offer OTC services to crypto traders like Kraken OTC, Falconx, Cumberland, Athena Investment Services, Crypto Desk, B2C2, Bankhaus Scheich, Bitpanda Plus, and Coin Cola.

Amid the recent crypto market carnage, the DRW company Cumberland tweeted about the firms OTC flow during the past week and let people in on some of the moves that were made. The most frequent question were asked on weeks like this is what does the flow look like? Cumberland tweeted on June 14. OTC flow gives some insights into how the market is handling these major moves, the OTC trading desk added. Cumberland was founded in 2014, and over the last few years, it has become one of the top OTC desks worldwide.

When Cumberland first started, news reports noted that the company was able to acquire massive amounts of bitcoin (BTC) via a few U.S. Marshalls operated auctions. Cumberland offers more than 30 different digital assets against 500 pairs, and the company claims to be one of the largest liquidity providers in the cryptocurrency space. Speaking about the recent crypto market rout, Cumberland disclosed that lots of crypto volume came directly to OTC desks.

Cumberland said:

On big swings, more volume tends to come to OTC desks, and yesterday was no exception; it was the most volume weve seen so far this year. In fact, it was 30% more volume than the previous YTD high, May 13th. Traders tend to use OTC during fast markets because its much easier to move size. Volumes were very BTC-centric, with about 75% of the total flow in bitcoin. ETH was the majority of the remainder. When looking to exit risk, traders tend to trade the most liquid products.

The crypto market bloodbath had shown a significant amount of leverage was wiped out during the last two weeks. Cumberland suggested that quite a bit of the flow on June 13 was liquidations. A number of crypto lending firms have been accused of being liquidated on very large positions in recent times such as Celsius. Large crypto hedge funds like Three Arrows Capital (3AC) are also being accused of having financial hardships and dealing with liquidations from over-leveraged positions.

The flow ratio suggests a lot of the flow was liquidations, with a 2:1 ratio of sellers to buyers, Cumberlands Twitter thread concluded. As always, Cumberland is proud to act as the backstop of liquidity during the most severe market moves.

What do you think about Cumberlands summary of OTC flow from the recent crypto market bloodbath? Let us know what you think about this subject in the comments section below.

Jamie Redman is the News Lead at Bitcoin.com News and a financial tech journalist living in Florida. Redman has been an active member of the cryptocurrency community since 2011. He has a passion for Bitcoin, open-source code, and decentralized applications. Since September 2015, Redman has written more than 5,000 articles for Bitcoin.com News about the disruptive protocols emerging today.

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Cumberland Sees Massive OTC Moves During Crypto Market Rout 'Most Volume We've Seen This Year' Bitcoin News - Bitcoin News