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Ethereum breaks supply record
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Bitcoin takes a dive as CPI data dampens investors’ sentiment
Key points:
Bitcoin and other major cryptocurrencies experienced a significant price drop.
The decline was primarily triggered by the release of the July U.S. CPI data.
News - Bitcoin and other major cryptocurrencies experienced a significant downturn on Thursday, erasing nearly all the gains made in the previous week.
The leading cryptocurrency, Bitcoin, plummeted by over 4%, dragging Ether down by 3.8%, and other major tokens like Solana, Cardano, BNB, and Ripple following suit.
What was the reason behind the fall? The catalyst for this market slump was the release of the July U.S. Consumer Price Index (CPI) data. While the figures aligned with expectations, marking the first time the CPI has dipped below 3% since 2021, it triggered a sell-off in the crypto market.
Analysts predict a potential further drop in Bitcoin's price to as low as $55,000 before a rebound. However, positive economic indicators supporting a potential easing of monetary policy by the Federal Reserve could reverse this trend and push Bitcoin towards the $66,000 mark.
The cryptocurrency ETF market also saw mixed fortunes. Bitcoin ETFs recorded a net outflow of $81 million, with Grayscale's GBTC leading the losses. On the other hand, Ether ETFs bucked the trend with net inflows of $10 million.
Crypto exchange Binance back in India after paying $2.2 Million fines
Key points:
Binance has completed registration with India's Financial Intelligence Unit.
The registration follows a $2.2 million fine for operating without authorization.
News - Cryptocurrency giant Binance has secured full registration with India's Financial Intelligence Unit (FIU), marking a significant step forward for the exchange in the country.
This comes just months after the platform was slapped with a $2.2 million fine for operating without proper authorization.
What’s more? The registration, Binance's 19th globally, now allows the exchange to fully operate its website and app within India. This development follows a period of regulatory scrutiny and a ban under the country's anti-money laundering laws.
Binance and other exchanges, including KuCoin, faced penalties for non-compliance with India's anti-money laundering rules. Both platforms have since paid their respective fines and obtained registration.
The company has been actively addressing legal issues in various jurisdictions, including a substantial settlement with U.S. authorities last year.
Binance's CEO, Richard Teng, emphasized the company's dedication to fostering a secure and transparent ecosystem, highlighting the importance of regulatory compliance in its business strategy.
Ethereum supply breaches 120 Million threshold amid staking boom
Key points:
Ethereum's total supply of ETH surpassed 120 million.
Increased staking activity contributed to a net increase in ETH supply.
News - Ethereum has achieved a significant milestone with its total supply of Ether surpassing 120 million coins. This milestone coincides with a rise in staking activity, highlighting a potential trade-off within Ethereum's economic model.
The surge in staking, a process where users lock up their ETH to earn rewards, is contributing to a net increase in the overall supply.
Despite this inflationary trend, the shift from a proof-of-work (PoW) to a proof-of-stake (PoS) consensus mechanism has demonstrably improved network security and user participation through staking rewards.
Currently, over half a trillion dollars worth of ETH, roughly 33.9 million coins, is staked on the network, continuously generating new ETH.
Further fueling the issuance growth is the rise of restaking platforms like EigenLayer, Symbiotic, and Karak. These platforms allow users to automatically reinvest their staking rewards, compounding the inflationary effect. EigenLayer's recent 11% surge in total value locked (TVL) exemplifies this growing trend.
AAVE on a bullish run, but whale activity threatens upside
Key points:
AAVE is defying the overall bearish market trend.
The alt’s low correlation with Bitcoin could protect it from market downturns.
News - AAVE has bucked the overall bearish trend in the cryptocurrency market, showcasing resilience and potential for growth. However, a closer look at whale activity reveals a potential roadblock to its upward trajectory.
While large wallet holders have been accumulating AAVE since late July, a recent selling spree worth over $5.25 million in the past two days has halted the altcoin's rally.
Although this amount may seem insignificant compared to their overall holdings, it has been enough to disrupt AAVE's upward momentum.
More details - Despite this, AAVE has a potential advantage. Its correlation with Bitcoin has dropped to a mere 0.03, indicating a reduced dependency on the king cryptocurrency. This decoupling could shield AAVE from the broader market's bearishness and minimize the impact of whale selling.
Technically, AAVE is trading within a broadening ascending channel, a bullish pattern suggesting a potential price surge. A breakout above the $124 resistance level could propel the altcoin by 30% to the $163 mark.
More stories from the crypto ecosystem
Interesting facts
On August 15, 2010, Bitcoin faced a huge bug - and 184 billion BTC were created out of thin air. The BTC supply is supposed to be capped at 21 million, but an integer overflow (which happens when a calculation tries to store a value in a variable that is larger than the available space) allowed an unknown attacker to create a ridiculous amount of Bitcoin. The issue was noted in 90 minutes and a fix was rushed in.
On the Ethereum network, users need to post a base gas fee, which is the minimum amount of gas required to include a transaction on the blockchain.
Solana is capable of a throughput of 50,000 transactions per second (TPS). By comparison, Ethereum averages 15 TPS, with a maximum recorded speed of 62.
Top 3 coins of the day
Binance Coin (BNB)
Key points:
BNB was changing hands at $528, at press time.
It was up by around 8.7% over the past week.
What you should know - The BNB price chart shows a mixture of bullish and bearish signals. BNB is currently trading at $527.8. The near-term support is at $480, while the near-term resistance is at $600. The long-term resistance level is at $700. The chart indicates that BNB recently rebounded from its support level, suggesting strong buying interest around $480. However, it faces significant resistance around $600, which could be challenging to overcome without a significant catalyst. The Bollinger Bands indicate increased volatility, with the price currently near the upper band, suggesting a potential overbought condition. The Awesome Oscillator shows a declining momentum, hinting at possible short-term bearishness.
Near Protocol (NEAR)
Key points:
NEAR, at press time, was trading at $4.22.
It has seen a short-term 7-D spike of 12%.
What you should know - The NEAR Protocol (NEAR) chart illustrates a significant downtrend from a high of $7.25 in early July to a recent low of $3.85 in early August, a decline of approximately 47%. This sharp drop was followed by a minor recovery, with NEAR currently trading at $4.215. The Relative Strength Index (RSI) is at 43.20, indicating NEAR is still in the bearish territory but showing signs of potential recovery. The chart shows that NEAR faces immediate resistance at the $5 level, coinciding with the 50-day EMA. Sustained buying pressure could propel the price towards this resistance level. On the downside, $3.85 remains a crucial support level, a break below which could trigger further declines.
Injective (INJ)
Key points:
INJ was one of the few coins with the highest 7-D gain.
It was trading at $18.92, at the time of writing.
What you should know - INJ shows a predominantly bearish trend since its peak in early April at around $52. The coin has been in a downtrend, breaking through multiple support levels. Currently, it is trading at $18.86, showing a slight recovery from its recent low of $15 in early August. The Bollinger Bands indicate high volatility, with prices touching the lower band and attempting a rebound. The 50-day EMA is at $21.31, and the 100-day EMA is at $23.36, both above the current price, suggesting strong resistance levels. The MACD shows a slight bullish divergence, which could indicate a potential trend reversal.
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