Cardano celebration ends

January 05, 2024

 

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ETH profit supply takes a hit as the coin dips 6% in 24 hours

Key points

  • ETH experienced its most significant decline in over two months on 2 January  

  • However, there was no clear sign of a potential sell-off at press time

News - Ethereum experienced a significant decline of over 6% on January 2nd, with its value settling around $2,210. This dip marked the most substantial drop observed in the past few weeks.

Analyzing the impact - The price decline had a considerable impact on the portion of ETH in a profitable state. According to AMBcryto's analysis, prior to 3 January, the supply in profit exceeded 110 million ETH, making up over 84% of the total supply.

 By the end of 3 January, the figure had dropped to approximately 107 million, constituting around 82% of the supply. At the time of writing, the supply in profit had further decreased to around 104 million, representing about 79% of the total supply.

Any positive developments? On the same day, 3 January, ENS, the governance token of the Ethereum Name Service project, experienced a 63% surge in the intraday trading session. This uptick was prompted by Ethereum co-founder Vitalik Buterin highlighting the protocol's importance.

ADA returns to $0.5 as New Year gains fizzle out with subsequent losses

Key points

  • ADA has returned to the $0.5 price range due to the ongoing decline

  • The funding rate for Cardano has reached its lowest point in weeks

News - Cardano began 2024 on a positive note, experiencing a 5% surge on 1 January, reaching a trading value exceeding $0.6. Unfortunately, this gain was short-lived, as subsequent days saw losses of over 2.9% on 2 January and nearly 8% on 3 January.

How did holders react? A look at ADA's volume chart on Santiment revealed a substantial increase, from approximately $400 million on 1 January to over $1 billion by 3 January, reaching almost $1.2 billion as of the latest update. The surge in volume indicates a significant uptick in ADA sales over the past two days, implying a sell-off by the holder. 

This conclusion is based on the observed correlation between price direction and the rising volume; had the price risen alongside the volume, it would have indicated an accumulation trend instead.

How has this affected market sentiment? The analysis of Cardano's funding rate on Coinglass revealed a slight shift in market sentiment. 

On 2 January, the funding rate was 0.07%, reflecting optimism despite the decline. However, a further price decline on 3 January influenced this sentiment, causing the funding rate to drop to around 0.03%. As per the latest update, the funding rate had decreased to 0.009%, signaling reduced trader optimism, even though the overall sentiment remained positive. 

Nigeria’s central bank gives nod to cNGN stablecoin official launch

Key points

  • In a circular to banks on 22 December 2023, the Central Bank of Nigeria acknowledged the rising global demand and adoption of cryptocurrencies

  • In line with this, it lifted restrictions on Nigerian banks facilitating cryptocurrency transactions

News - The Central Bank of Nigeria (CBN) has granted approval to the Africa Stablecoin Consortium (ASC) for testing the cNGN stablecoin within its regulatory sandbox. The official launch of this new stablecoin is scheduled for 27 February 2024.

Is it safe for consumers? In a blog post, the ASC, comprising Nigerian banks and fintech operators, stated that the cNGN stablecoin meets regulatory requirements set by the CBN, the Nigerian Securities and Exchange Commission, and the Nigerian Financial Intelligence Unit. 

Additionally, the token is pegged 1:1 to the Nigerian Naira, the nation's official fiat currency, and is supported by Naira reserves stored in specific commercial banks. 

Where & how can it be used? While it is currently compatible only with blockchains like Bantu and BNB Smart Chain, there are plans to broaden its compatibility to include all major blockchain networks in the future. 

The stablecoin is designed to expedite money transfers from Nigerians abroad to their families in Nigeria, bypassing remittance delays. It also seeks to eliminate the expensive fees commonly associated with traditional international transactions.

Bankrupt crypto lender Celsius to unstake $469M Ether ahead of repayments

Key points

  • Celsius filed for chapter 11 bankruptcy in July 2022

  • The firm has withdrawn 40,249 ETH since then

 News - Crypto lending platform Celsius has confirmed the initiation of the recall and rebalancing of its crypto assets. In a statement on 5 January, the firm highlighted the move as a strategy to ensure ample liquidity in anticipation of potential asset distributions. 

Additionally, Celsius plans to unstake its existing Ether holdings, which have been a significant source of staking rewards income for the company.

How will the assets be used? According to the announcement, the freed-up Ether will be used to cover specific expenses associated with the restructuring process and unlock ETH to ensure timely distributions to creditors. 

This marks a positive turn for customers who have been waiting for a minimum of 18 months to recover their funds, as Celcius had announced the distribution of Bitcoin or ETH to creditors as part of its recovery plan. 

What impact is this expected to have on ETH? As per a report by blockchain analytics firm Nansen, almost one-third of the ETH in the pending withdrawal queue, valued at around $468.5 million and totaling 206,300 ETH, belongs to Celsius. 

While there are concerns about a potential "dump" of Ether on the markets due to this move, there are contrasting views indicating that it could be a positive development for Ether markets in the long term.

Did you know?

  • The first Bitcoin ATM debuted in Vancouver, Canada, in 2013. The ATM allowed users to buy and sell Bitcoin in a physical location, bridging the gap between the digital and physical realms.

  • Global mining for the largest cryptocurrencies is estimated to create between 110 – 170 million metric tons of carbon dioxide emissions per year, according to a White House report.

  • Despite the Nigerian government’s ban on cryptocurrencies in 2021, many Nigerians continue to trade them. According to Merchant Machines data, Nigeria will be at the forefront of global crypto adoption by 2030.

Top 3 coins of the day

Litecoin (LTC)

  • In a post on X, analyst Ali Martinez shared a 3-day chart that showed LTC forming a bear flag.

  • As a result of the formation, Martinez noted that the coin might sink to $38.

What you should know - Over the past seven days, Litecoin has seen a drop in value, as it lost 14.8%. At the time of writing, the altcoin was trading at $65.20, reflecting a 0.7 decrease in the last 24 hours. At its press time price, Litecoin was still down 84.10% from its all-time high of $410.26 set on 10 May, 2021. The RSI also noted a reading of 36, below the 50-mark, reaffirming a strong selling bias.

Aptos (APT)

  • The rise in Aptos appears to be related to news that crypto exchange OKX will be adding support for Aptos inscriptions to its NFT marketplace.

  • Data from Aptos Explorer reveals a significant 16% increase in user transactions between 1 January to 4 January.

What you should know - Aptos at press time was valued at $10.43. It increased by 3.4% in the past week and 0.4% in the past 24 hours, with its market cap zooming to $3.2 billion. Trading volumes over the last 24 hours rose a staggering 118% to $706.5 million. The Chaikin Money Flow (CMF) indicator also underlined a positive trend as the buyers were seen dominating the market. 

Stacks (STX)

  • STX saw a 15% jump in the first two days of 2024.

  • As of press time, the bearish stand at the $1.75 mark remained a crucial roadblock to further recovery in the altcoin’s price.

What you should know - For the last 7 days, STX has been in a good upward trend, thus increasing by 8.4%. At the time of writing, the crypto had increased by 1.1% over the past 24 hours and was changing hands at $1.65. The Fear & Greed Index displayed a score of 68 (Greed), suggesting that investors were exhibiting high levels of optimism in the current market conditions. The On Balance Volume also reinforced this trend as it was seen in the bullish zone. 

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