Ethereum in danger

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Solana network activity surges despite a bearish influence on the price

Key points:

• Despite high network usage and DeFi growth, SOL's price action remained flat.

• Negative market sentiment and potential whale selling pressure might be hindering price gain.

News - Solana's network activity surged in January, attracting a significant number of new users. However, this positive development failed to translate into price gains for the token, which remained subdued under bearish pressure.

Data from Artemis revealed a 21% month-on-month increase in Solana's daily active users, placing it just outside the top three blockchains in this metric. Daily transactions and fees also remained high, suggesting strong network utilization.

What about its DeFi growth? Its performance in the decentralized finance (DeFi) space saw a commendable improvement, reflected in a substantial rise in Total Value Locked (TVL) to $1.66 billion at press time.

However, on-chain analysis revealed persistent negative sentiment surrounding SOL, potentially contributing to the lackluster price performance. Furthermore, whales transferring SOL to exchanges also indicated selling pressure.

Well, at the time of writing, SOL was trading at $95.40 with a 4.05% decrease in the last seven days. The volume registered a sharp fall of 18.98% over the last day, thus raising concerns among investors.

BlackRock's Bitcoin ETF surges to top 0.16% of US-issued ETFs with $3.19B inflows

Key points:

• BlackRock's Bitcoin ETF surges to the top 0.16% of US ETFs within weeks of launch.

• Grayscale's GBTC faces headwinds with continuous outflows for six days.

News - BlackRock's iShares Bitcoin Trust, a newly launched spot Bitcoin exchange-traded fund, has achieved a remarkable feat, propelling itself into the top 0.16% of all US-listed ETFs within a short timeframe. This rapid ascent showcases the significant investor interest.

The BlackRock ETF has attracted over $3.19 billion in inflows since its launch on January 11th. This surge positions it within the top ten U.S. ETF products, surpassed only by broad market index funds like the S&P 500 tracker.

What about other BTC ETFs? Fidelity's Bitcoin Fund has also demonstrated impressive performance, securing the eighth position among US ETFs with inflows exceeding $2.51 billion. Notably, both BlackRock and Fidelity's offerings have significantly climbed the rankings since their launch, solidifying their place among the most popular ETFs.

Data from BitMEX Research reveals a widening gap between BlackRock and Fidelity's ETFs and their seven rival spot Bitcoin products. While ARK 21Shares and Bitwise occupy the third and fourth positions with respectable inflows, the gap between these leading contenders and the rest is widening.

Meanwhile, Grayscale's converted spot Bitcoin ETF, the Grayscale Bitcoin Trust (GBTC), has experienced its sixth successive day of diminishing outflows, marking a notable decline from its worst day of outflows on January 22.

Ethereum's price outlook indecisive: It could range between $2,215 and $2,500

Key points:

• Analysts predict FTX and Alameda's selling pressure can affect ETH in the long run.

• Ethereum's price remains indecisive, hovering around $2,300 amid mixed market signals.

News - Ethereum's near-term price direction remains uncertain, caught between conflicting technical indicators. While recent buying suggests the potential for a rebound, bearish threats could pull the price lower.

The Accumulation/Distribution (A/D) indicator reveals ongoing buying pressure, with investors taking advantage of the recent dip. If this trend intensifies, a rise to $2,500 in the short term is possible. However, a decline in A/D, indicating distribution, could trigger a bearish move towards $2,215.

However, the Money Flow Index (MFI) presented a contrasting perspective, with a reading of 64.25 indicating sufficient buying pressure to support Ethereum's price above $2,300.

What of the on-chain indicators? The Market Value to Realized Value (MVRV) ratio indicates that Ethereum is currently trading at a fair value, neither overvalued nor undervalued. However, this also implies long-term bullish potential, with a possible jump toward $3,500 if market conditions improve.

On a side note, it’s important to acknowledge that Ethereum was part of the cryptocurrencies let go by defunct crypto exchange FTX and its sister firm Alameda. The firms sent 1,000 ETHs to Coinbase. Some analysts predict this movement could have a negative influence on the coin in the long term.

Virginia lawmakers propose establishment of work group to research blockchain and cryptocurrency

Key points:

• Virginia lawmakers propose setting up a work group to research blockchain technology, digital asset mining, and cryptocurrency.

• The work group is slated to operate throughout 2024 and present its findings to the Governor and Virginia General Assembly by the beginning of 2025.

News - Virginia is taking a cautious approach to cryptocurrency, opting for a research group instead of immediate regulations proposed earlier.

Senate Bill No. 339 proposes establishing a work group under the Bureau of Financial Institutions to study blockchain technology, digital asset mining, and cryptocurrency. This group will gather information and make recommendations throughout 2024, aiming to submit a report by the end of 2025.

What’s more? This work group approach replaces Senator Salim's earlier bill, which outlined specific regulations for crypto mining, transactions, and taxation. That bill aimed to incentivize crypto use through tax breaks and lighter regulations, but it has been abandoned in favor of further study.

Curiously, a recent study ranked Virginia outside the top five "best states" for cryptocurrency taxes. Florida, Texas, and Wyoming topped the list due to their favorable policies and tax treatment.

More stories from the crypto ecosystem

• Will Ripple’s request for an extension work in XRP’s favor?

• BONK presents buyers with another chance to go long

• XMR crashes 30%: Is Binance’s delisting the only reason?

• Cardano ‘old timers’ are moving: Is an ADA dump coming?

• As JUP’s price floats above $0.5, are predictions favoring the bears?

Did you know?

• The term "HODL" originated from a misspelling of "hold" in a Bitcoin forum post during a market downturn in 2013, and it has since become a popular term in the crypto community.

• The smallest unit of Bitcoin is called a satoshi, named after Satoshi Nakamoto, and is equivalent to one hundred millionth of a Bitcoin (0.00000001 BTC).

• The concept of a decentralized autonomous organization (DAO) was first proposed by Ethereum co-founder Vitalik Buterin in 2013.

Top 3 coins of the day

Dogecoin (DOGE)

Key points:

• As per Santiment, over 413.8K non-zero wallets were added to the DOGE network in the past two weeks.

• At press time, the whales weren’t showing much interest in buying, this could be a cause for concern.

What you should know - Dogecoin has been dominated by selling pressure after mid-December. On 20 January, the meme coin did try to recover, but it wasn’t met with bullish sentiment. Consequently, DOGE declined and has since been trading in a consolidated phase. The volume as well has been on a free fall, raising concerns among the long-term holders. Well, the size of the candlesticks and the reading of RSI certainly indicate that there is some exhaustion in the market and traders are waiting for more clarity before deciding their next move. In fact, Coinglass’ data pointed out that the number of bearish short bets has consistently surpassed bullish longs over the last week.

Monero (XMR)

Key points:

• After Binance announced the delisting plan of XMR, the token almost immediately went for a freefall.

• Social volume metric noted a significant spike, thus highlighting that XMR became a hot discussion among the crypto community.

What you should know - XMR investors woke up to the unexpected news of XMR delisting from Binance on 6 February, following which the coin saw huge selling pressure, one that wasn’t seen in a year. The rangebound movement of the coin was taken over by bears, highlighting the vulnerability of the coin’s listing on exchanges. Even so, XMR saw a resurgence of demand on 7 February. If the buying pressure keeps picking up, XMR could correct its 30% loss in the short term. On the contrary, it could go down to its $90 level very soon. The MACD indicator was skewed toward the bears, however, the press time price looked healthy at $129 with 12% growth over the last day.

Avalanche (AVAX)

Key points:

• Recent advancements in decentralized exchanges (DEXes) on the Avalanche network hint that a potential turnaround could be on the cards.

• The number of NFT sales on the Avalanche fell by 12.5% over the last week.

What you should know - AVAX started an uptrend in December, this was long due. Investors hadn’t experienced the high of $49 in over a year. However, the coin, of late, has seen some sort of bearish pressure, but buyers have been able to negate that well. At the press time point, if holders decide to take their profit, the coin might dip down to its support zone of $22-$18. But overall market sentiment looked in favor of the coin since the coin registered an uptick of 0.60% over the past 24 hours. Volume, however, was a bit disappointing given the volume oscillator hasn’t moved in an upward direction post-2 February. Traders should, therefore, exercise caution before making any move.