Fantom brushes off network outage with another 50% price surge

With over 3,000% growth since the turn of the year, even a recent network outage couldn't stop Fantom's bullish surge.

The decentralized smart contract platform Fantom (FTM) continued its resurgent rally to the tune of 50% on Monday, despite a temporary network outage that saw the blockchain stop producing blocks for seven hours.

Fantom emerged among the top 100 in the market cap rankings in January — eventually going on a 5,000% run that peaked in late February. Since then, the coin’s bull run subsided, but its value against the United States dollar still stands 3,434% higher than it did on Jan. 1.

But Fantom was subject to a brief blackout on Feb. 25, when block production was halted after two validators slowed down the rate of emissions. Fantom is a Proof-of-Stake blockchain where 39 validator nodes oversee block creation on behalf of stakers. The two validators in question represented one-third of the FTM staked on the platform.

The development team successfully coordinated and applied a temporary patch which got the network up and running again seven hours later. A recent announcement by Fantom stated:

“On Thursday, February 25 2021 at 3.04 PM UTC, Fantom Opera mainnet halted new block confirmations, which resulted in a temporary outage. The core developer team and Fantom validator community immediately responded and successfully resumed the network within 7 hours.”

The fix required the consensus of 39 validators in multiple time-zones, and the development team notes that no staked funds were at risk during the outage.

In response to the incident, the development team decided to address the imbalance of power among validators and will attempt to distribute influence more evenly among nodes. To achieve this aim, the amount of FTM required to set up a validator node will be reduced from its current prohibitive figure of 3,175,000 FTM.

In January, this equated to a dollar value of just over $30,000. Now, following Fantom’s recent surge, that figure stands over $1.8 million.

Fantom’s recent surge has been attributed to developments made in the realm of interoperability and decentralized finance. The project was recently integrated into Multichain.xyz — a decentralized token swap protocol that bridges disparate blockchains such as Ethereum and Binance Smart Chain, and enables token swaps without any intermediary.

On Monday morning, Fantom’s ascension continued, as the coin price climbed from $0.3827 to $0.58, equating to 54% growth by time of publication.

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3 reasons Bitcoin recovered by 8% overnight — Key levels to watch next

Bitcoin rebounded by over 8% overnight and there are three key reasons behind the rally, in addition to macro factors.

The price of Bitcoin (BTC) recovered by more than 8% overnight on March 1 following a steep drop during the weekend.

There are three reasons the price of Bitcoin recovered swiftly in the past 24 hours. They include the recovering global stock market, rising Coinbase premium, and a typical weekend reversal.

BTC/USD 1-hour candle chart (Bitstamp). Source: Tradingview

Rising global stock market coincides with weekend reversal

The global stock market has started to recover as soon as the market opened on Monday, March 1.

The stock market slumped over the past week due to the rising Treasury yield curve. As the bond market rallied, risk-on assets, such as stocks, saw a pullback.

Holger Zschaepitz, said the global risk markets started the week strongly as bond yields eased. He said:

"Global risk mkts start the week on the front foot as bonds rally. Australia's 10y yield fell 25bps, German 10y drops 3bps ahead of inflation data. US 10y steady at 1.41%. Following last week’s bloodbath, easing in bond yields is big relief. Gold gains to $1757. #Bitcoin at $46.8k."

Although Bitcoin is considered a safe haven asset and a store of value, it often moves in tandem with the risk-on market.

This trend occurs because the market capitalization of Bitcoin is still hovering at around $1 trillion. Bitcoin's valuation is relatively small compared to other safe-haven assets like gold. Hence, there is a higher probability that it would be more affected by macro factors, at least in the short term.

Analysts at Santiment explained:

"The relationship between the price of #Bitcoin and traditional stocks remains higher than the historical norm. As we've noted in previous data studies, $BTC's rallies tend to be the most prominent when this correlation turns negative, as it did in December, 2020."

Bitcoin price fluctuation with the S&P 500. Source: Santiment

The simultaneous recovery of the global stock market and cryptocurrencies followed a minor correction in the crypto market over the weekend.

Historically, when the price of Bitcoin falls hard during the weekend, BTC often sees a relief rally in the following week.

This likely occurs because there is generally lower volume during the weekend. Hence, the trend can change sharply when a new weekly candle emerges

Coinbase premium returns

In the past 12 hours, the Coinbase premium rebounded to around $100. Prior to the reversal, Coinbase was selling at a lower price than Binance, which meant there was strong selling pressure coming from the U.S.

As Cointelegraph reported, the futures funding rate resetting signaled that the market became less overheated. this coinciding with the Coinbase premium returning was a solid signal of improving appetite for Bitcoin, particularly in the U.S.

Coinbase premium. Source: CryptoQuant

When the price of Bitcoin trades lower on Coinbase, it is a sign of short-term bearishness because the U.S. dollar pair naturally trades higher than Tether.

In the foreseeable future, based on the recovering stock market trend and the consistently high Coinbase premium, the crypto market has a good chance of rebounding this week.

Whale clusters. Source: Whalemap

Whale clusters from Whalemap also show that $46,000 and $56,000 are the key support and resistance levels in the short term. 

Since Bitcoin rebounded strongly from $46,000, there is a high probability that it could rally to $56,000 in the next impulse wave.

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Rakuten's customers can now use Bitcoin for shopping

Japanese retail giant Rakuten has integrated its crypto wallet with its payment app, enabling consumers to directly load and convert their Bitcoin holdings for use in everyday spending.

Crypto-friendly Japanese retailer Rakuten is now enabling users of Rakuten Wallet, its crypto exchange subsidiary, to easily spend their cryptocurrency holdings in everyday transactions. 

According to an announcement published on Feb. 24, users are now able to load up their Rakuten Pay accounts seamlessly with their wallet holdings of Bitcoin (BTC), Bitcoin Cash (BCH) and Ether (ETH). Rakuten Pay is a mobile payment app that is operative nationwide and supported at a wide range of large and medium-scale retailers. 

Diagram showing Rakuten's new service integration. Source: Rakuten

Back in 2019, Rakuten had already enabled consumers to convert their Rakuten Group loyalty points to cryptocurrencies like Bitcoin. Now, a deeper integration is being implemented, tying together Rakuten Wallet, Rakuten Cash (Rakuten's e-money service) and Rakuten Pay together to support cryptocurrency spending at retailers such as McDonald's, Seiyu and FamilyMart. 

There will be no conversion fees between fiat, e-money and crypto holdings, although there is a minimum spend amount of 1,000 yen (roughly $9.40) and a monthly upper limit of around 100,000 yen (roughly $940).

To make use of the integration, users will need to be a Rakuten member and have a trading account set up for Rakuten Wallet. The company is also offering a small bonus of Rakuten points to incentivize the new service.

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Bitcoin is at a ‘tipping point’ in international trade, Citi says

Mainstream adoption is within Bitcoin's grasp, according to Citi analysts.

The world’s largest cryptocurrency, Bitcoin (BTC), is at a defining moment in history, according to analysis from American investment bank Citigroup.

Bitcoin is now at a “tipping point” to either become the preferred currency for international trade or face a “speculative implosion,” Citi analysts reportedly said.

According to a Reuters report Monday, Citi analysts are confident that Bitcoin is on the cusp of going mainstream. According to the report, Bitcoin’s tremendous potential has been fueled by recent big Bitcoin moves by companies like Tesla and Mastercard.

Citi analysts wrote, “There are a host of risks and obstacles that stand in the way of Bitcoin progress. But weighing these potential hurdles against the opportunities leads to the conclusion that Bitcoin is at a tipping point.”

Citi analysts also hinted that the mainstream adoption of Bitcoin could be helped along by digital currency developments like central bank digital currencies and fiat-pegged stablecoins. 

The news comes amid a major correction on the cryptocurrency market, with Bitcoin dropping below $44,000 yesterday after hitting a new all-time high of above $58,000 earlier in February. At publishing time, Bitcoin is trading at $47,285, up around 4.5% over the past 24 hours, according to data from Cointelegraph’s Bitcoin price index.

According to some experts, global regulation could be one of the biggest hurdles for Bitcoin’s adoption by institutional investors. Bridgewater director of investment research Rebecca Patterson said on Feb. 24 that regulatory certainty around Bitcoin would solve some of the cryptocurrency’s biggest problems associated with high volatility and low liquidity.

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Gazprom Neft uses blockchain tech to streamline aircraft refueling

Gazprom Neft’s aviation refueling subsidiary has piloted a blockchain-based refueling payment project to automate and accelerate transactions.

Russian oil firm Gazprom Neft's aviation subsidiary — Gazpromneft-Aero — announced Monday that it has completed a successful pilot of its blockchain-based refueling project, Smart Fuel.

The new platform was implemented for more than 100 scheduled flights of Russian budget airline Smartavia, operating at the international airport of Murmansk. Alongside Smartavia, the pilot involved major banks VTB and Raiffeisenbank.

Dmitry Makarov, head of the Smart Fuel project, told Cointelegraph that the blockchain-based trial in Murmansk ran from September to December 2020. Following the successful pilot, Gazpromneft-Aero will continue providing its refueling payment solution to Smartavia, Makarov said.

Based on the major blockchain framework Hyperledger Fabric, the new tool uses smart contracts to automate and accelerate refueling payment processing times. The system is capable of processing refueling payments in a matter of seconds, while the traditional payment transactions usually take up to four or five days, Gazpromneft-Aero said.

Makarov explained that the traditional process for refueling payments is paperwork-heavy and involves excessive spending. “Since it’s impossible to forecast the exact volume of fuel needed for a flight, airlines need to transfer an excessive amount of funds to fuel operators to make sure there’s enough to cover the refueling,” he said. The new tool guarantees data safety and maximum transparency for all the participants in a transaction, Makarov stated.

Gazpromneft-Aero has previously developed blockchain-based solutions for aircraft fuelling. As previously reported, the Gazprom Neft subsidiary partnered with major Russian air carrier S7 Airlines to collaborate on DLT-based fuel delivery and payment system in 2018.

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China's BSN partners with TON Labs to utilize Telegram blockchain

While Telegram's token project is dead, the blockchain still lives.

TON Labs and China’s Blockchain-based Service Network are collaborating to build applications on the Telegram-built TON protocol.

According to an announcement issued on Monday, the partnership grants BSN developers access to TON technology.

As with other instances of adapting public networks to the BSN China infrastructure, TON Labs will adapt the Telegram-built TON protocol to suit the demands of Chinese regulations. Hence, the TON network implementation on BSN China will be an Open Permissioned Blockchain or OPB version.

According to He Yifan, CEO of Red Date Technology — a founding member of the BSN — Chinese developers will be looking to the low latency, scalable TON blockchain as a suitable base layer for developing useful applications.

For TON Labs, the collaboration with the Chinese blockchain infrastructure project will help to increase developer activity on the TON protocol, bringing more value to the project.

Commenting on the potential benefits of the collaboration for both partners, TON Labs CEO Cyril Paglino remarked that it was a testament to the possibility of creating useful alliances between decentralized and centralized enterprises, adding:

“It’s a creative approach to send a strong message that a company, a country, a people, even when facing certain statutory hurdles, can still find a way to use technology earmarked for everyone on the planet despite whatever localized mandates there may be, and while remaining in total compliance, vis-a-vis, adoption.”

As previously reported by Cointelegraph, despite Telegram abandoning the TON blockchain following regulatory pushback on its Gram token project, the technology underpinning the project continues to survive. Instead of being run by the messaging app service, the protocol is now community-owned under the aegis of the Free TON network.

TON is the latest public blockchain to make a splash on the permissioned BSN China. Given the strict regulatory environment in China, the BSN project has two main implementations — BSN China and BSN International.

Back in February, Cosmos became the first public blockchain to be added to BSN China.

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Here’s how the Purpose Bitcoin ETF differs from Grayscale’s GBTC Trust

The newly launched Purpose Bitcoin ETF surpassed even the most bullish expectations but how does it differ from Grayscale’s GBTC Trust?

Since 2017, investors have been anxiously awaiting a Bitcoin ETF approval as the existence of such a fund was an important symbol of mass adoption and acceptance from the realm of traditional finance. 

On Feb. 18, the Toronto Stock Exchange hosted the official launch of the Purpose Bitcoin ETF and the fund quickly absorbed more than $333 million in market capitalization in just two days.

Now that the long-awaited Bitcoin ETF is here, investors are curious about how it will compete with Grayscale Investments GBTC fund. On Feb. 17, Ark Investment Management founder and CEO Cathie Wood said the likelihood that U.S. regulators will approve a Bitcoin exchange-traded fund has gone up.

Although exchange-traded funds (ETF) and exchange-traded notes (ETN) sound quite similar, there are fundamental differences in trading, risks, and taxation.

What is an exchange-traded fund?

An ETF is a security type that holds underlying investments such as commodities, stocks, or bonds. It often resembles a mutual fund, as it is pooled and managed by its issuer.

ETFs have become a $7.7 trillion industry, growing by 65% in the last two years alone.

The most recognizable example is the SPY, a fund that tracks the S&P 500 index, currently managed by State Street. Invesco's QQQ is another EFT that tracks U.S.-based large-capitalization technology companies.

More exotic structures are available, such as the ProShares UltraShort Bloomberg Crude Oil ($SCO). Using derivatives products, this fund aims to offer two times the daily short leverage on oil prices.

What is an exchange-traded note?

Exchange-traded notes (ETN) are similar to an ETF in that trading occurs using traditional brokers. Still, the difference is an ETN is a debt instrument issued by a financial institution. Even if the fund has a redemption program, the credit risk relies entirely on its issuer.

For example, after Lehman Brothers imploded in 2008, it took ETN investors more than a decade to recoup the investment.

On the other hand, buying an ETF gives one direct ownership of its contents, creating different taxation events when holding futures contracts and leveraging positions. Meanwhile, ETNs are taxed exclusively upon sale.

GBTC does not offer conversion or redemption

Grayscale's Bitcoin Trust Fund (GBTC) is the absolute leader in the cryptocurrency market, with $35 billion in assets under management.

Investment trusts are structured as companies — at least in regulatory form — and are 'closed-end funds.' Thus, the number of shares available is limited and the supply and demand for them largely determines their price.

Investment trust funds are regulated by the U.S. Office of the Comptroller of the Currency (OCC), therefore outside the Securities and Exchange Commission (SEC) authority.

GBTC shares cannot easily be created, neither is there an active redemption program in place. This tends to generate significant price discrepancies from its Net Asset Value, which is the underlying BTC fraction represented.

An ETF, on the other hand, allows the market maker to create and redeem shares at will. Therefore, a premium or discount is usually unlikely if enough liquidity is in place.

An ETF instrument is far more acceptable to mutual fund managers and pension funds as it carries much less risk than a closed-ended trust like GBTC. Retail investors may not have been aware of the possibility that GBTC trades below net assets value. Thus the recent event might further pressure investors to move their position to the Canadian ETF.

To sum up, an ETF product carries a significantly less risk due to greater transparency and the possibility to redeem shares in the case of shares trading at a discount.

Nevertheless, the impressive GBTC market capitalization clearly states that institutional investors are already on board.

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

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