This week saw Bitcoin’s price above the $4k mark and stable throughout the entire week, as were the top 5 markets. Other important developments include announcements of important releases such as Lightning Loop and Huobi Prime, new research showing that most crypto trading volumes are actually suspicious and that PoS coins are on the rise, one of the QuadrigaCX co-founders actually being a convicted criminal in the past, and new regulations for Switzerland, Japan, Canada, and the US.
Here’s what you need to know about last week’s events in the crypto world:
1. Cryptocurrency market analysis
Bitcoin (BTC) broke the $4k barrier and stayed above that mark the entire week. It opened Monday at $4,029.97 and after going up 1%, went back down slightly and closed the 18th at $4,032.51. It closed Tuesday at $4,071.19, gaining 1% for the day. The rest of the week didn’t show any great changes, and both the low and high of the week came on Thursday, at $4,005.15 and $4,097.36 respectively, with a small change of 2.3%. On Sunday it closed at $4,022.17, a 0.3% loss for the day and a 0.2% loss for the week. BTC’s market cap on Monday was $70.96B, and at closing on Sunday it was at $70.8B, losing just 0.2% throughout the week.
Ethereum (ETH) started the week at $140.1 and then peaked for the week that same day at $142.27. By closing on Monday, ETH had gone down to $139.37. Like BTC, the Ethereum coin didn’t have any important changes. The low of the week came on Thursday when the coin plummeted down to $135.86, losing 4.5% from its high on Monday. The weekend was stable, and on Sunday it closed at $136.99, with a 1% loss for the day and a 2.2% loss for the week. ETH’s market cap on the 18th was $14.67B and by the end of the week it had shed 1.6%, closing Sunday at $14.4B.
Ripple (XRP) started the week at $0.3177, and by the end of the day, the price hadn’t changed significantly, closing at $0.3174. The week showed stability and the price experienced the most changes on Thursday with 3.6% between the highest and lowest price that day. The peak of the week also took place on Thursday, at $0.3208. The weekend was calmed for XRP, opening both Friday and Saturday at $0.3113. On Sunday, the low of the week and the lowest closing of the week occurred at $0.3082 and $0.309 respectively, with a 1% loss for the day and a 2.7% loss for the week. XRP’s market cap went down 2.1% during the week, from $13.15B on the 18th to $12.87B on the 24th.
Litecoin (LTC) barely showed changes throughout the week. On Monday it opened at $61.28 and early into the day, the high of the week occurred at $62.77. The low of the week came on Wednesday at $58.57, losing 6.7% from the peak two days earlier. It closed Sunday at $60.22, experiencing a 1.7% loss for the day and a 1.7% loss for the week. Unlike the aforementioned coins, LTC’s market cap hardly even increased 0.08% during the week, going from $3.673B on Monday to $3.675B on Sunday.
EOS started Monday at $3.78 and close into the day’s start, the peak of the week took place at $3.81. The price of the EOS coin slowly decreased during the week, bottoming out at $3.62 on Wednesday and again on Thursday. Friday’s opening and Sunday’s closing prices were the same — $3.66 — for a consistent weekend. Sunday saw a 0.8% loss for the day and a 3.2% loss for the week. EOS’s market cap on Monday was $3.4B and by Sunday it had lost 2.5%, closing out the week at $3.31B.
Even though BTC managed to stay on top of the $4k mark, all crypto markets ended the week in red, with minimal decreases for prices. Almost all top 5 market caps — with the exception of Litecoin’s slight increase — experienced losses, the biggest one being 2.5% for EOS.
2. Lightning Labs announces initial release of Lightning Loop
In a Mar. 20 blog post, the company announced the release of Lightning Loop as a non-custodial service that will make it easier for people to receive funds on Lightning, something that was troublesome for some of its users. After receiving a certain amount of funds, Lightning users will not be able to receive any further payments until they offload their funds from the network. The “Loop Out” function will take care of that issue, increasing users’ receiving capacity by moving funds “out of Lightning and into a bitcoin wallet, cold storage, or fiat currency via an exchange”. For the initial release, Loop Out transactions will be limited to a maximum of 0.01 BTC, and on-chain fees will still be charged.
The blog post also announced that there will be a “Loop In” function released sometime in the future, which will do the opposite — allow users to refill Lightning channels with on-chain bitcoin from a cryptocurrency wallet or an exchange.
3. Huobi launches its own token sale platform and announces support for USDT-TRON
As per an official blog post from Mar. 20, Singaporean exchange, Huobi, will launch a dedicated platform, named Huobi Prime, specifically designed to provide early access to coins at a reduced price. The platform, which will benefit both personal users and professional investors, will feature listings with three different 30-minute coin offering rounds, with the price of the crypto rising with each round. There will be an individual investment cap of $1,000, and purchases can only be made with the proprietary Huobi Token (HT). The official launch is scheduled for Mar. 26, and the first project will be TOP Network’s TOP token.
Huobi also announced that they would be supporting the new USDT-TRON, according to a Mar. 21 blog post. Similarly, Malta-based exchange OKEx has also announced their support for TRON’s version of the stablecoin. This means that both exchanges support three separate protocols of USDT: USDT-Omni, USDT-ERC20 and now USDT-TRON.
4. New research shows that vast majority of BTC and crypto exchange trading volumes are suspicious
According to research carried out by trading analytics platform The Tie, 87% of the reported trade volumes of crypto exchanges may actually be incorrect. These results, published on Mar. 18, come from figures gathered from 97 exchanges, the majority of which boast volume numbers that come from users that may not exist. The results show that “87% of exchanges reported cryptocurrency trading volume was potentially suspicious and that 75% of exchanges had some suspicious activity occurring on them”.
A similar study, conducted by Bitwise and reported on Mar. 22 by the WSJ, shows that nearly 95% of reported Bitcoin trading volume are actually artificially created by unregulated exchanges. As part of an application to launch a btc-based ETF, Bitwise collected and analyzed Bitcoin trading data, across more than 80 different crypto exchanges. The study concluded that out of the reported $6 billion daily trading volume, only $273 million was considered legitimate.
5. Binance hosts its third Launchpad sale and announces format change
According to the official sale results released by Binance, the sale of Celer Network (CELR) tokens, which took place on Mar. 19, sold all 597,014,925 available CELR tokens in just 17 minutes and 35 seconds, which is equal to $4 million. The CELR sale marks the third Launchpad sale, after hosting BitTorrent Token and Fetch.AI sales, which raised $7.1 and $6 million, respectively. These sales were also short-lived, lasting less than 15 minutes in the case of BTT and only 22 seconds in the case of the FET sale.
Additionally, a blog post on Mar. 24 indicated that there will be an update regarding the format of upcoming Launchpad token sales. The past three sales functioned under a first-come-first-serve system, but upcoming sales will adopt a lottery system. Binance users will be able to claim up to 5 lottery tickets depending on the amount of BNB they hold in their accounts. The exchange claims that this system is used by various traditional exchanges around the world in order to bolster fairness and transparency.
6. “Crypto Czar” claims that some stablecoins might be violating securities laws
During her talk on this year’s SXSW, Valerie Szczepanik, the Senior Advisor for the US SEC, claimed that some stablecoins violate the securities law. During the conference, she stated that there are three groups of stablecoins, highlighting that some are tied to real assets, such as gold and oil; others are linked to fiat reserves; and then there’s a third group of stablecoins, which are the ones which have a central authority that controls the price of the stablecoin.
Szczepanik, dubbed by the press as “the first Crypto Czar”, stated that stablecoins that belong to the third group are potentially breaking securities laws, although each project has to be looked at individually. She also claims that in order to stay on the good side of the SEC, people should “ask for permission, not forgiveness”.
7. Blockchain platform Bakkt earns $740 million valuation despite constant delays
The much-awaited public release of Bakkt, originally planned for November, has been delayed several times due to problems related to obtaining approval from the Commodity Futures Trading Commission (CFCT). As the WSJ reported on Mar. 21, the platform’s plans to store customers’ BTC from its Bitcoin futures could be a reason for further delays. However, the CFCT informed the platform that in order to have custody from its customers’ crypto holdings, disclosures of Bakkt’s business plan and public comment period would be needed, which would further delay the approval.
In spite of the delays and the lack of any investment products, The Block reported on Mar. 21 that Bakkt earned a $740 million valuation after raising $180 million in funding. However, the constant delays have raised some questions among investors, particularly regarding their risk-return ratio.
8. One of QuadrigaCX’s co-founders is actually a convicted criminal
According to a Mar. 19 Bloomberg report, Canadian records obtained by the news agency show that Michael Patryn, co-founder of the infamous Canadian exchange, QuadrigaCX, legally changed his name on two separate occasions, in 2003 and 2008. Moreover, it was revealed that one of his past identities was Omar Dhanani, a convicted criminal who was sentenced to 18 months in a U.S. federal prison and subsequently deported to Canada, where he reinvented himself as a cryptocurrency entrepreneur. Patryn left QuadrigaCX in 2016 and is now serving as a founder and chairman at Fintech Ventures Group.
The crimes that are linked to Patryn’s former legal name include identity theft, bank and credit card fraud, operating a website that dealt with stolen credit card numbers, burglary, grand larceny, and computer fraud.
9. Western Union and Digitec Galaxus add cryptocurrencies to their payment services
Digitec Galaxus, Switzerland’s largest online retailer, now accepts cryptocurrency payments. In a press release on Mar. 19, the company stated that customers can now use Bitcoin, Ethereum, Ripple, TRON, and other cryptocurrencies to pay for purchases over 200 CHF (around 200 USD). The new method was co-developed with Swiss e-payment specialist, Datatrans AG, which cooperates with Coinify, a Danish crypto payment provider.
Western Union (WU) has partnered with Stellar collaborator, Thunes, a network for cross-border payments, to enable WU customers to transfer funds directly into mobile wallets through the WU digital network or agent locations. In a press release published on Mar. 21, Sobia Rahman, Global Head of Account Payout Network for WU, stated that this collaboration attempts to make digital money transfer services more accessible for consumers, “especially those who lack access to traditional financial services.”
10. Switzerland, Japan, Canada, and US Missoula County introduce new regulations for crypto
On Mar. 20, The Swiss Federal Assembly approved a motion to have the Federal Council modify existing provisions on procedural instruments of judicial and administrative authorities and adapt them for cryptocurrency regulation. On Mar. 22 the Federal Council stated that “the consultation on the adaptation of federal law to developments in distributed ledger technology (DLT)”. This process will end on June 30.
Japan introduced new regulations last week stating that all crypto exchanges that handle margin trading must obtain new government registration, with the intention of limiting leverage at two to four times the initial deposit. This new cryptocurrency regulation will come into force in April 2020, and it is also meant to protect investors by having entities that deal with cryptocurrencies monitored in a way that resembles securities traders. The Canadian Securities Administrators, on the other hand, has proposed a temporary ban on crypto platforms for short trading and on crypto firms that support margin finance to protect investors, at least until there is a better understanding of crypto asset trading risks to the market.
The County of Missoula in Montana, USA, will be discussing The Cryptocurrency Mining Resolution and the Cryptocurrency Mining Zoning Overlay District Regulations at a public hearing on Apr. 4. These resolutions propose the use of renewable energy for mining cryptocurrencies to “protect the public health, safety, morals, and general welfare of county residents,” emphasizing the possible effects crypto mining has on global warming.
This week showed promise, especially with Bitcoin, which Binance Research had named the bellwether for the entire industry, being above the $4k mark the entire week. Other positive developments include the release of a new token sale platform on Huobi Prime, the high valuation of new platform Bakkt despite its delays, and the adoptions of crypto payments from Western Union and Digitec Galaxus. However, the fact that most trade volumes for Bitcoin and crypto exchanges are actually artificial or misleading is worrisome, and does a great deal of damage for crypto as a whole.
We wish you a great week,