While some began to call for a retracement to shore up new support levels, excitement nonetheless remained as the driving mood at the time of writing.
"Multi-month regime of both spot premium and quarterlies backwardation + Massive on-chain accumulation by several measures. All we've been missing is momentum," Blockware lead insights analyst William Clemente explained.
"As long as $46K holds, think momentum/trend-based market participants push this back to range highs."
That perspective was echoed by Rekt Capital, who identified two key moving averages as providing the potential fuel to send the largest cryptocurrency back to all-time highs.
The moment #BTC is able to breach the mid-range resistance...
Clemente added a chart showing that Bitcoin's moving average convergence divergence (MACD) indicator had flipped green, signaling the start of an uptrend, for the first time since November's all-time highs.
BTC/USD chart with MACD. Source: William Clemente/ Twitter
On-chain monitoring resource Whalemap, meanwhile, reiterated that $47,400 was a key area on macro levels thanks to accumulation having taken place there previously.
The macro outlook stays the same as in the tweet below
47.4k is the most important level in the 47k area right now
In an additional nod to the current rally being more sustainable than previous ones this year, analyst Philip Swift highlighted that funding rates on derivatives platforms remained curiously low despite optimism in both sentiment and market performance.
2022 "won't be that easy" for risk assets
For macro analysts, the focus was on whether Bitcoin was breaking out against traditional assets with its latest gains.
U.S. stocks were mostly flat on March 28's open, while gold enjoyed only a modest uptick.
Discussing the trend, Mike McGlone, senior commodity strategist at Bloomberg Intelligence, queried whether BTC might be "taking the risk-off baton."
"1Q may be just another blip in the trend of rising risk assets amid the highest inflation in 40 years and war in Europe, yet our bias is that the 2022 endgame isn't likely to be that easy," he reasoned.
McGlone added that Bitcoin was nonetheless "showing divergent strength."
Nasdaq 100 vs. BTC/USD 1-week chart with 50-week moving average. Source: Mike McGlone/ Twitter
Is it really different this time? Bitcoin is back at the yearly open, but they jury's out when it comes to what's next.
Bitcoin (BTC) begins the last week of March with a bang after returning to its yearly opening price above $46,000.
In a surprisingly strong upward move for a weekend, BTC/USD began surging upwards Saturday, continuing overnight to challenge its highs from the start of 2022.
Coming against an ongoing macro climate of considerable uncertainty, strength in Bitcoin is naturally being taken with a pinch of salt this month. The reaction is understandable given that previous attempts to break out of its multi-month trading range have all ended in failure.
Despite volatile periods, bulls were always left disappointed and Bitcoin subsequently not only reversed but often revisited the lower end of its range, costing both short and long positions dearly.
Nonetheless, the hope is that this time really will be different — analysts had long argued that only a breakout above the range ceiling, formed by the yearly open around $46,200, would be enough to cause a paradigm shift.
Now that this is in action on the charts, attention is focusing on the final hurdle — cementing these multi-month resistance levels as support.
With the process ongoing Monday, Cointelegraph takes a look at potential triggers that could make or break this important episode in Bitcoin price action.
Bitcoin wipes out the 2022 dip
“Gradually then suddenly” or pure chance? Traders are still trying to make sense of Bitcoin’s newfound strength this week.
It’s been a sight absent from the chart since the New Year — BTC/USD is back at $47,000. After jumping almost $3,000 in 24 hours, the largest cryptocurrency dealt a firm blow to resistance levels which had for months kept bulls firmly in their place.
The significance of $46,000 has been a hot topic for almost as long — a return to the yearly open, many said, would be the signal that Bitcoin was ready for bigger things once more.
Few would have thought that the phenomenon would play out “out of hours,” however, and suspicions over the rally’s real strength are naturally pervasive on social media as the week gets underway, just as they were as the rally itself began.
march 2020 - ct was bearish, fooo was bullish
may 2021 ct was bullish, fooo was bearish
july 2021 ct was bearish, fooo was staking fooo's entire reputation on more upside
november 2021 fooo began dumping, ct was bullish
now ct is bullish and fooo is bearish
Wholesome
— fooo - Mayor of Goblin Town (@bitcoinpanda69) March 26, 2022
Nonetheless, even more cautious voices are no longer discounting the potential for further upside, even if longer-term prognosis remains downhill.
“Fundamental buying pressure for Bitcoin has now climbed into bull market territory,” analyst and statistician Willy Woo reported.
Fellow analyst Matthew Hyland, a key supporter of the $46,000 argument, meanwhile gave a target of $52,000 as the next long-term resistance wall to crack.
#Bitcoin has broken above the $46k resistance zone
In Twitter posts, he added that the move was preceded by a breakout on Bitcoin’s relative strength index (RSI) indicator, itself a classic signal of breakout trends.
RSI assesses how overbought or oversold an asset is at a specific price, and in the case of Bitcoin, its score has been climbing off a floor level since mid-January, data from Cointelegraph Markets Pro and TradingView shows.
Further development of RSI, therefore, could dictate the extent of the rally, as per historical behavioral norms.
BTC/USD 1-day candle chart (Bitstamp) with RSI data. Source: TradingView
Analyst eyes Bitcoin stocks decoupling
It’s a confusing world out there, and when it comes to how Bitcoin should be acting, the picture does not get any easier.
Inflation, war in Europe and the persistent threat of Coronavirus returning — to name just three major macro triggers — have had commentators forecasting doom and gloom for stocks and risk assets alike in 2022.
Just this month, multiple sources warned that Bitcoin could soon face its Waterloo as a dramatic stocks capitulation sparks another March 2020 moment.
The “easy money” age which followed that event is gone, and only a continuation of quantitative easing would bring back the huge capital flows Bitcoin enjoyed later that year, some argued.
Now, however, Bitcoin appears to be striking out on its own, challenging an intense stock market correlation which in the case of the S&P 500 reached a 17-month high last week.
While the S&P has shaken off the impact of the Russia-Ukraine war and plans for tightening by the United States Federal Reserve, analysis shows that selling has been considerable and shorts are everywhere — the perfect fuel, ironically enough, for a fresh “short squeeze” upwards.
Equity Traders sold heavily into this rally:
• One of the biggest weekly purges in history (as a % of Market Cap)
• Total $ selling hit a new record
• Spec Positioning now significantly Net Short – at risk of a further squeeze
“Risk-on/Risk-off correlations to equities is a short term effect. BTC trades this correlation due to short term speculators,” Woo explained in a recent dedicated Twitter thread on the topic.
“Bitcoin's internal demand fundamentals powered by its adoption curve is more powerful. Eventually the market decouples; the last time was Oct 2020.”
Should speculators have been ruling the roost so far this year, then a return of interest in Bitcoin futures could be a trigger to watch going forward. Open interest in Bitcoin futures is now at its highest since December, data from Coinglass shows.
Bitcoin futures open interest chart. Source: Coinglass
Who wants their money back?
There is another side to the $46,000 story, making it more than just a symbolic level from the New Year.
As noted by on-chain analytics firm Glassnode this weekend, the area around $45,900 is one with a giant amount of prior buyer activity.
Market entrants bought in on the way down from all-time highs, and have been underwater since thanks to it providing the ceiling for Bitcoin’s 2022 trading range.
A return, Glassnode warned, may ruin the mood as a rush for the exit from those buyers plays out.
“The next major on-chain resistance for Bitcoin is the Short-Term Holder Realized Price, trading at $45.9k. This metric is the average price paid for BTC by investors who purchased after the October ATH,” it explained Friday alongside a chart of its long- and short-term holder realized cap indicator.
“Bearish resistance comes from STHs seeking to 'get their money back.'”
Bitcoin long- and short-term holder realized cap chart. Source: Glassnode/ Twitter
So far, short-term holders — defined as entities holding coins for 155 days or less — have not triggered a reversal of direction. The start of Wall Street trading, however, could still produce surprises.
Difficulty should see a new all-time high in days
Bitcoin’s network fundamentals are certainly determined not to disappoint this year.
The coming week will be no exception, as Bitcoin’s network difficulty climbs to new record highs of approximately 28.67 trillion.
The move will follow a month of losses, which as Cointelegraph reported accompanied the results of upheaval for miners operating in Kazakhstan.
Difficulty’s next automated readjustment, however, will not only cancel out those losses but add 4.4% to the existing tally, making difficulty greater than ever before.
Bitcoin difficulty 7-day average chart. Source: Blockchain
The implication of increasing difficulty is essentially that mining for block subsidies has never been more competitive, as evidenced by Bitcoin’s equally bullish hash rate data.
In turn, Bitcoin becomes more resistant to network attacks as an increasing miner presence dedicates more and more resources to competing for the same fixed reward — and thus protecting network participants in the process.
Last year’s 50% hash rate drop, sparked by a crackdown in China which was previously the world’s mining stronghold, now seems nothing more than a distant memory.
Effects of “banning” bitcoin mining. Bitcoin hash rate new ATH, higher than when the “ban” happened. pic.twitter.com/pY5ea1rCJB
An attempt to ban Proof-of-Work cryptocurrency support in the European Union meanwhile failed to gain the support of lawmakers a second time last week.
Hash rate provided by known mining pools sat at around 219 exahashes per second (EH/s), according to data from monitoring resource MiningPoolStats, itself the highest level ever recorded.
Greed is back for the first time since $60,000
Bearish at the bottom and bullish at resistance — it’s a classic market sentiment feature which plays out time and time again.
For the first time in 2022, however, the Crypto Fear & Greed Index has laid out just how exuberant the average crypto investor is feeling.
For the first time since just after Bitcoin’s most recent all-time highs of $69,000 in November, the classic sentiment indicator has entered “Greed” territory.
Its transformation, like sentiment itself this month, has been impressive. Just a week ago, it measured the mood as a normalized score of 22/100 — not just “fear,” but “extreme fear.”
Now, it is hot on the way to showing the opposite, and as long-term investors know, sustained rallies tend only to come alongside gradual increases in sentiment.
Big jump up in the Fear and Greed Index today on that $BTC move.
Last time we were this far into Greed territory, price was +$60k.
Some of them, however, remain clearly excited to see what happens next.
“The crypto markets on a steady uptrend while the supply shock kicks in. It will only take one bullish event to send this back to all-time highs,” JRNY Crypto argued Sunday.
“Watch how crazy things get when the sentiment goes from fear to greed while supply is limited.”
Crypto Fear & Greed Index (screenshot). Source: Alternative.me
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.
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The City of Austin gears up to become America’s next crypto hot spot by passing two resolutions focused on cryptocurrency and blockchain innovation.
Innovative cities across America are racing to become the next hot spot for cryptocurrency and blockchain adoption. Miami was the first city to adopt its own part of CityCoins last year, allowing it to implement its own cryptocurrency called “MiamiCoin” to be used for civic engagement.
New York City has also made a name for itself as a crypto-friendly city by implementing educational initiatives and with Mayor Eric Adams receiving his paycheck in Bitcoin (BTC) in January this year.
Austin takes a strong stance
Most recently, Austin — the state capital of Texas that goes by the slogan “Keep Austin Weird” — has taken a strong interest in cryptocurrency and blockchain technology. While Texas’ desire to lead the way for crypto innovation was established about a year ago when Governor Greg Abbot tweeted that he is a “crypto law proposal supporter,” the city of Austin has taken additional measures to ensure the acceptance of cryptocurrency for city services.
Count me in as a crypto law proposal supporter.
It is increasingly being used for transactions and is beginning to go mainstream as an investment. (Fidelity, etc. trying to get Bitcoin ETF).
On March 9, 2022, Austin city council member Mackenzie Kelly put forth a resolution to direct the Austin city manager to explore possible use cases of cryptocurrency to benefit Austin and its residents. The resolution specifically asks for the city manager to examine how the city could adopt Bitcoin and other cryptocurrencies for financial transactions.
Kelly told Cointelegraph that her resolution directs the city manager to conduct a fact-finding study to determine what would be required for the city to accept Bitcoin or other cryptocurrency payments for city services:
“This is more of a feasibility study. We currently don’t have enough information as council members to know if we can accept crypto as payment for city services. We need to know more about this before we can decide. In doing so, there is security information we need to look at to see if this is even viable or if we can keep crypto on our books financially. We don’t know if we can bill it as an asset — that would prevent us from being able to accept crypto as payment. There’s also the financial stability of crypto as a whole, and if we can even accept it in that regard.”
Image from Austin city council meeting on March 24, 2022. Source: Austintexas.gov
Although questions remain, Kelly mentioned that Austin has always been a forward-thinking and innovative city, noting that many cryptocurrency investors currently live and work in Austin. Kelly added that Austin Mayor Steve Adler is a co-sponsor of her resolution. Given this support, Kelly believes cryptocurrency payments will serve as a useful alternative to allow individuals the flexibility of paying for certain city services. She elaborated:
“If someone gets a speeding ticket, for example, and doesn’t have a bank account but has cryptocurrency, they could use crypto as payment. Or, if they wanted to pay their taxes or electric bills using Bitcoin or dedicate a park in their name using crypto. This is all part of the analysis for allowing the city of Austin to accept crypto payments.”
This could certainly make a huge impact, as recent data from Finder.com found that 8% of Texans already own Bitcoin and that adoption in the state could hit 14% by the end of the year. Austin, in particular, could benefit from crypto payments for city services, as Google data shows that Austin ranks at the number one city in Texas that searches for the keywords “Bitcoin” and “crypto.”
All things considered, it shouldn’t come as a surprise that Kelly’s resolution was approved during Austin’s city council meeting that took place on March 24. Now that the resolution has passed, Kelly explained that the next step for approval will occur in mid-June when the Austin city manager can determine if crypto can indeed be accepted as payment. This will be based on the city’s research regarding financial stability, security, equity and inclusion and consumer benefits or risks.
In addition to Kelly’s resolution, Adler’s resolution focusing on blockchain technology was also passed during Austin’s March 24, 2022 working session. During the meeting, city council member Sabino Renteria explained that Austin started exploring the use of blockchain four years ago to ensure that the city’s homeless population would have control of their personal records at all times. “The concept was what if we use blockchain technology to be able to give folks ownership and access to all of their records,” he remarked. Renteria added that he is “excited at the prospect of what blockchain can do.”
While both resolutions are innovative, some Austin city council members expressed concerns during the meeting. Councilmember Leslie Pool mentioned that her single biggest concern regarding blockchain implementation is its “lack of a central authority.” She added:
“It may be tamper evident and tamper resistant, but that is all that it is. It’s a digital ledger. So there may be some unique uses for this or for the city to promote its use, but at this point, given its relatively recent entry into data storage or other digital arenas, I’m really cautious relating to the city diving into adopting or using it. I very much want to hear from our financial office staff or experts on these technologies before taking decisions to adopt these items.”
Regarding the cryptocurrency resolution put forth, council member Pool added:
“I continue to believe crypto is too volatile, a form of currency to risk tax payer dollars or employee retirements. Crypto is unregulated. It's not just unregulated. It's also unprotected. There's an element for me of gaming involved here. THat leaves me really uneasy. Crypto as a form of payment or investment is inconsistent with the role of a municipality in safeguarding the community’s revenue.”
Austin pushes forward, despite concerns
Concerns aside, Austin residents remain positive regarding cryptocurrency and blockchain innovation within the city. For example, Jesse Paterson, chair of the education committee at ATX DAO — a chain-agnostic decentralized autonomous organization (DAO) in Austin — told Cointelegraph that the organization aims to serve as a local resource to help educated city council members and residents on the implications of the recently passed resolutions:
“Some ATX DAO members were at city hall showing our support for the resolutions, yet we still lent some caution because we are still in the early days of crypto. Therefore, it takes time to understand the space before diving into projects.”
DAO representatives @CrystalGravy2@theSamPadilla and @realitycrafter showed up for today's Austin City Council Meeting to give public comment in support of resolutions 55 + 57.
ATX DAO is glad to offer support to any city projects or investigations into the web3 space. pic.twitter.com/8zzIEQVyNz
Ryan Harvey, ATX DAO community manager and long-time resident of Austin, added that, based on the wording of both council member Kelly’s crypto resolution and Mayor Adler’s blockchain resolution, it’s clear that these are still fact-finding missions. However, he noted this is a positive step in the right direction:
“New information is always a good thing. But, even beyond fact-finding, both resolutions show that Austin is open for business and encourages innovation, which is fantastic.”
During the March 24 council meeting, Harvey took a few minutes to share his thoughts with city council members. He stated that, “There are organizations here in town like ATX DAO — and I was excited to see DAOs mentioned in the resolution — that can be a point of reference.”
ATX DAO community manager, Ryan Harvey commenting at the March 24 city council meeting. Source: Austintexas.gov
In addition to efforts being made by ATX DAO, other Austinites are creating initiatives with crypto and Web3 elements to give back to the community. For example, City Magic is a project aiming to bring communities in Austin together through grants in the form of nonfungible tokens (NFTs).
City Magic founder Raffi Sapire told Cointelegraph that the project awards $1,000 grants to those in the Austin community who want to create a friendly space or event for neighbors or for civic engagement. “City Magic is for civically-minded people and for those who care about the community. It also helps build a bridge for people who may not have interacted with tokens before. Grants are NFTs, and the cost to join our committee is equal to one grant that will benefit civic engagement.”
Adler recently demonstrated his support for Sapire and other blockchain-focused Austin entrepreneurs and businesses in a tweet that read, “Austin is excited to support the businesses and innovations that will turn the promises of Web3, cryptocurrency, and blockchain technology into reality.”
Moreover, Austin may soon join the ranks of Miami and New York City by implementing its own CityCoin. A CityCoin community member spoke about how this may play out in a presentation conducted at ETH Austin, a two-day long event that took place during South By Southwest. The community member shared that CityCoins’ main goal is to work with the city of Austin to help officials like Mayor Adler and council member Kelly better understand how Austin’s own cryptocurrency can be successful. “We need to define this and make sure we do it right before we go about anything. Ideally, we’d like to have an announcement on this during Consensus 2022, set to happen on June 9.”
CityCoins community member presenting at ETH Austin. Photo Credit: Rachel Wolfson
When asked about a CityCoin being implemented in Austin, Kelly remarked, “I’m open to the idea, but my financial conclusion of that depends on my resolution passing and knowing that it’s feasible for the city of Austin to accept crypto as a whole.”
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ADA, AXS, LINK and FTT may start a strong recovery in the next few days if BTC holds the $45,000 level as support.
Bitcoin (BTC) is attempting to notch its second successive weekly gains and end at the highest weekly closing price year-to-date. According to on-chain data from Glassnode, the recovery in Bitcoin’s price was driven by demand in the spot markets. This is likely to cheer the bulls because history suggests that spot market demand leads to sustained upside.
Another positive sign is the strong demand for the ProShares Bitcoin Strategy exchange-traded fund (BITO) in the past two weeks, which pushed its exposure to a record high. Arcane Research said the strong inflows “suggest that Bitcoin appetite through traditional investment vehicles is increasing."
Along with Bitcoin, the broader crypto space is also attracting investors. According to research firm Fundstrat, venture capital buyers pumped $4 billion into the crypto space in the last three weeks of February.
Could buyers sustain the momentum and extend the relief rally in Bitcoin and altcoins? Let’s study the charts of the top-5 cryptocurrencies that may outperform in the short term.
BTC/USDT
The long wick on Bitcoin’s March 25 candlestick shows that the bears are defending the overhead resistance at $45,400. A minor positive is that the bulls have not given up much ground, suggesting that the traders are not closing their positions in a hurry.
BTC/USDT daily chart. Source: TradingView
The 20-day exponential moving average ($42,025) has turned up and the relative strength index (RSI) is in the positive territory, indicating that bulls are in command. If buyers drive the price above $45,400, the BTC/USDT pair could rise to the resistance line of the ascending channel.
This level may again act as an obstacle, but if bulls overcome it the pair could rally to the psychological level at $50,000.
Contrary to this assumption, if the price turns down from $45,400, the bears will try to pull the pair to the strong support at $42,594. This is an important level to watch on the downside because if bulls flip it to support, the possibility of a break above $45,400 increases.
The bears will have to pull and sustain the price below the moving averages to signal that the bulls have been pushed to the back foot.
BTC/USDT 4-hour chart. Source: TradingView
The 4-hour chart shows that the price turned down from the overhead resistance but the bulls did not allow the pair to break below the 20-EMA. This suggests that traders are buying on every minor dip.
The rising moving averages and the RSI near the overbought zone suggest that the path of least resistance is to the upside. This positive view will invalidate in the short term if the price breaks and sustains below the 20-EMA. In that case, the pair may drop to $42,594.
ADA/USDT
Cardano (ADA) has been sustaining above the critical level at $1 for the past few days. This indicates that bulls who may have purchased at lower levels are not booking profits aggressively as they expect the recovery to continue.
ADA/USDT daily chart. Source: TradingView
The moving averages have completed a bullish crossover and the RSI is in the positive zone, indicating that bulls have the upper hand. If buyers push and sustain the price above $1.26, the bullish momentum may pick up and the ADA/USDT pair could rally to the next critical resistance at $1.60.
Alternatively, if the price turns down from $1.26 but rebounds off $1, it will suggest that the pair may remain range-bound between the two levels for a few more days. The bears will have to sink and sustain the price below the moving averages to invalidate the bullish view.
ADA/USDT 4-hour chart. Source: TradingView
The 4-hour chart shows that the bears are aggressively defending the overhead resistance at $1.20 but a minor positive is that the bulls have not allowed the price to sustain below the 20-EMA. If the price rises from the current level, the bulls will again try to clear the hurdle at $1.20 and push the pair to $1.26.
Alternatively, if the price turns down and breaks below the 20-EMA, it will suggest that the bullish momentum has weakened. The pair could then gradually decline toward the strong support at $1.
AXS/USDT
Axie Infinity (AXS) has been trading between $72 and $44 for the past few days. The buyers pushed the price above the overhead resistance on March 25 but could not sustain the higher levels. This indicates that the bears are defending the level with vigor.
AXS/USDT daily chart. Source: TradingView
The moving averages have completed a bullish crossover and the RSI is in the positive territory, suggesting advantage to buyers.
If the price turns up from the current level or rebounds off the 20-day EMA ($56), the bulls will again try to thrust the AXS/USDT pair above $72. If they manage to do that, the up-move may pick up momentum and the pair may rally to $100.
This positive view will invalidate if the price continues lower and breaks below the 20-day EMA. That could keep the pair range-bound for a few more days.
AXS/USDT 4-hour chart. Source: TradingView
The 4-hour chart shows that the bulls pushed the price above the overhead resistance at $72 but could not sustain the higher levels. This may have attracted profit-booking by the short-term traders which pulled the price below the 20-EMA.
If the price turns up from the current level and breaks above $68, it will suggest accumulation on dips. The buyers will then try to clear the obstacle at $72 and start a new up-move.
Contrary to this assumption, if the price sustains below the 20-EMA, the correction could extend to the 50-simple moving average.
Chainlink (LINK) has been trading inside a massive range between $13 and $36 for the past several months. Although bears pulled the price below the support of the range, they could not sustain the breakdown. This suggests that the markets rejected the lower levels.
LINK/USDT daily chart. Source: TradingView
The moving averages have completed a bullish crossover and the RSI is in the positive territory, suggesting that the buyers have the upper hand. The rally may face resistance at the downtrend line but if this barrier is crossed, the LINK/USDT pair could rally to $20.
Alternatively, if the price turns down from the current level, the moving averages are likely to act as strong support. If the price rebounds off it, the possibility of a break above the downtrend line could increase. This positive view will invalidate if the bears pull the price below the moving averages. That could open the doors for a possible drop to $13.
LINK/USDT 4-hour chart. Source: TradingView
The bears are mounting a strong defense at $16.50 but a minor positive is that the buyers have not allowed the price to slip below the 50-SMA. If the price rises from the current level or rebounds off the moving averages, the bulls will try to propel the pair above $16.50. If they succeed, the pair could rally to $17.50.
Contrary to this assumption, if the price breaks below the 50-SMA, it will suggest that the short-term bulls may be closing their positions. There is a minor support at $15 but if it gives way, the pair could slide to $14.
FTT/USDT
FTX Token (FTT) broke and closed above $49 on March 24, completing an ascending triangle pattern. Although buyers pushed the price above the psychological resistance at $50 on March 25, they could not sustain the higher levels.
FTT/USDT daily chart. Source: TradingView
This suggests that the bears have not yet given up and they continue to sell at higher levels. The bears will now try to pull and sustain the price back below $49. If they manage to do that, the aggressive bulls who purchased the breakout from the triangle may get trapped. This could sink the FTT/USDT pair to the 20-day EMA ($45).
If the price rebounds off this level, the buyers will again try to clear the overhead resistance zone between $49 to $52 and resume the up-move.
Conversely, if the price slips below the moving averages, it will suggest that bears are attempting a strong comeback. A break and close below the uptrend line of the triangle will invalidate the bullish pattern. The pair may then decline to $39.
FTT/USDT 4-hour chart. Source: TradingView
The rally above $51 pushed the RSI deep into the overbought territory. Usually, such moves are followed by a sharp correction or consolidation. If bears pull the price below $49, the pair could decline further to the 50-SMA.
If the price rebounds off this level, the buyers will again try to push the pair above $52 and resume the up-move. On the other hand, if bears pull the price below the 50-SMA, the selling could intensify and the pair may drop to $45.
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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Any innovation must be engineered so that as adoption grows, the right scaling technologies can be integrated into it at the right time.
Cointelegraph is following the development of an entirely new blockchain from inception to the mainnet and beyond through its series, Inside the Blockchain Developer’s Mind, written byAndrew Levineof Koinos Group.
Scalability is a popular topic in blockchain, but few ever explain what we mean by that term. When we at Koinos Group talk about scaling what we mean is scaling to the masses. Creating a blockchain that everyone on Earth can use. That means the blockchain network has to be able to support that level of load, which is typically what people mean when they refer to scalability.
User experience matters
But what they talk about far less is the obvious implication that you must have a user experience that everyone on Earth can find pleasurable. Terrible user experiences are infinitely scalable because there is no demand for bad user experiences and the underlying network resources required to deliver them.
This is demonstrated by the fact that when most projects talk about scaling, they talk about technical implementations like sharding, proof-of-history, or layer 2, which are the solutions that Ethereum is using to solve its scaling challenges.
These projects are responding to Ethereum’s scaling constraints by trying to integrate those scaling solutions sooner, but are failing to realize that those solutions only make sense in Ethereum’s context as not only the first general-purpose blockchain but the one with the most developer adoption in the world.
Ethereum: The first mover
When Ethereum was released, it gave developers, for the first time ever, the ability to develop applications on a shared blockchain platform using a programming language very similar to the ones they were already using to build applications; a Turing complete programming language. Compared to the developer experience of building applications on other blockchains, building on Ethereum was a quantum leap that made it faster, easier and cheaper to build decentralized applications. Thanks to this unparalleled user experience, the usage of Ethereum grew at a high rate. Demand for Ethereum’s resources has outstripped supply, which has led to an increase in demand for gas, and a corresponding price increase, making all Ether (ETH) holders very happy.
The Ethereum developers and stakeholders do not want to eliminate fees or even necessarily reduce them. That would be like oil producers wanting to reduce the price of oil. If there is surplus demand for their network resources, they don’t care about creating a better user experience, they care about increasing supply (scaling) while maintaining the existing user experience.
But that is Ethereum! The 900-pound gorilla of general-purpose blockchains with first mover advantage, incredible developer adoption and unfathomable capital investment. It is a successful platform and its plans for scaling make perfect sense for Ethereum. But they make no sense for platforms that have no usage and no developer adoption.
This is why we see so many projects pursuing labor intensive and risky efforts like bridges to Ethereum in an attempt to siphon users off of Ethereum to trigger the growth they need to justify their scaling solutions!
Reasoning from analogy
But this is classic reasoning from analogy as opposed to reasoning from first principles; making decisions based on what everyone else is doing instead of focusing on the problem you want to solve and the most efficient path for developing a solution based on fundamental truths. Thinking that the way to scale a new blockchain is sharding because sharding is the way to scale Ethereum is a perfect example of reasoning from analogy.
At Koinos Group, we’re approaching this problem from first principles. Scaling to the masses is not about integrating some magical technology that overnight supports everyone and their mother. No technology platform ever goes from zero users to mass adoption overnight. Every platform or product that reaches mainstream adoption only ever achieved that through exponential growth. I’ll repeat that. Every product or platform reaches mass adoption through exponential growth.
What that means is that it doesn’t matter how many users or how many transactions your platform or application stack can handle on Day One. That is effectively irrelevant.
What matters the most is that your product has some unique value proposition that a small number of early adopters will love, even if the cost is relatively high. Koinos allows people to use decentralized applications for free simply by holding liquid KOIN tokens in their wallets. They don’t have to buy an account or consciously stake their tokens because every liquid KOIN token contains mana that is consumed down when they use the blockchain. As an account’s mana gets consumed, the tokens containing that mana are automatically locked for some time, creating an opportunity cost instead of an explicit fee.
Video game experience
This gives the blockchain a video game-like user experience, instead of the unpleasant UX of every other blockchain. This delivers a fundamentally different, and more pleasant user experience, but it’s not like the whole world is going to want to use Koinos on Day One. Ethereum’s fee-based model is still the dominant paradigm, which is only validated by its many imitators/competitors. It also has an army of developers, token holders and institutional investors advocating for it (and by extension, its fee-based model).
On Day One, a relatively small group (hopefully, not too small) of early adopters looking for the next best thing will begin using Koinos. The mainnet needs to be able to give those people a pleasant user experience, but no more. As those people use the blockchain and discover that it truly has a delightful user experience, they will spread the word, and usage of the blockchain will go up.
At a certain point, the usage of Koinos will get high enough that the amount of a user’s tokens getting locked is very high and the new user experience relative to the original user experience might be unacceptable. This is what Koinos hitting its scaling constraints looks like. But bear in mind, the user is still not losing those tokens forever (a fee), they are only sacrificing some opportunity cost, which is an infinitely better user experience.
Upgradeability: The ultimate scaling solution
Koinos has to be engineered so that as adoption grows, the right scaling technologies can be integrated at the right time. This is why Koinos is not optimized for any particular scaling solution, but upgradeability in general, making it as easy as possible for new technologies to be added once they have been sufficiently battle-tested. This turns all of the other projects experimenting with scaling technologies prematurely into fertile testing grounds for Koinos!
Scaling is not an end goal, it’s a process that unfolds throughout the lifetime of a platform, at least, if the platform is sufficiently upgradeable. If the platform isn’t sufficiently upgradeable then you have to pick the “right” scaling solutions on Day One, even if you don’t need it, but this is more of a reflection of poor upgradeability (and bad engineering) than anything else.
This is why I like to say that upgradeability is the ultimate scaling solution.
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.
The views, thoughts and opinions expressed here are the author’s alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.
Andrew Levine is the CEO of Koinos Group, a team of industry veterans accelerating decentralization through accessible blockchain technology. Their foundational product is Koinos, a feeless and infinitely upgradeable blockchain with universal language support.
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Front-running is a type of insider trading that affects an asset's market price. Read this guide to learn how to prevent front-running in crypto.
How to prevent front-running in crypto?
Users can limit front-running by splitting the transaction into many smaller transactions and adjusting the low slippage. Similarly, developers can use anti-front-running measures like making transactions private and using a hidden mempool.
Users can break large transactions into smaller ones instead of executing them all at once, which reduces the appeal of transactions with front-running bots due to the value that can be mined. As a result, bots will pass the transaction instead of front-running it.
When the bot places trades, it will also alter the price; therefore, keeping the adjustment slippage minimal will prevent customers from losing money. On the other hand, adjusting the low slippage can make the transaction more challenging to execute.
SparkPool's TaiChi network is a private transaction service that helps developers limit front-running in the crypto space. The miner-extractable value (MEV) bot is unable to find transactions on mempool because user transactions are only visible to Sparkpool and not to other Ethereum nodes. MEV is a metric that tells how much money blockchain miners can gain by arbitrarily including, excluding or reordering transactions.
KeeperDAO uses the Hiding Book mempool, which is a secret Mempool. Therefore, the Keeper bot will profit from MEV through arbitrage trading or asset liquidation by passing through transactions and loan requests. MEV revenues are deposited in the ROOK treasury, and users receive a portion of the profits in ROOK tokens. To avoid front-run slippage, these transactions are offered free of charge.
How to detect NFT front-running?
Front running can be identified by monitoring users’ trade data, such as their wallet addresses, purchases followed by sales of NFTs, and a series of fund transfers.
The acquisition or selling of a financial instrument by the front runner, the legitimate transaction, and the front runner's potential unwinding of the financial instrument to bring the cycle to a close are the three significant data points to consider while detecting front-running in NFTs.
Additionally, analysts should search for buy/sell orders close to an NFT artist's buy/sell order in the same instrument that impacted the NFT's price to notice any potential front-running tactics.
Furthermore, the compliance team should be able to use the trade reconstruction capabilities (pulling together different streams of data) to connect unstructured data, such as voice and electronic communications, to the trades to offer context, such as genuine dialogues with buyers (if selling NFTs), to rule out the wrongdoing.
How is wash trading crypto different from front-running tactics?
Wash trading is when an investor sells and buys the same asset to inflate the value of security artificially. On the other hand, a front-running attack on a blockchain occurs when a malicious user discovers a swap transaction after it has been broadcasted but before it has been finalized and reorders transactions to their benefit.
The NFT market is particularly susceptible to a practice known as wash trading. Several NFT trading platforms allow users to trade without identifying themselves by connecting their wallets to the site. This means that a single user can establish many wallets and link them to a platform.
After that, a person can control both sides of an NFT trade, selling it from one wallet and buying it from another. The trade volume increases as numerous similar transactions are completed. As a result, the underlying asset appears to be in high demand.
Similarly, front-running tactics like sandwich attacks focus on exploiting DeFi protocols and services. Sandwiching occurs when two orders are placed, one before and the other after the trade. In this case, the attacker will front-run and back-run simultaneously, sandwiching the original pending transaction in the middle.
A victim trades a cryptocurrency asset X, for example, Cardano (ADA), for another crypto-asset Y, for example, Ether (ETH), which is used to make a significant purchase.
Before the hefty trade is approved, a bot detects the transaction and front-runs the victim by purchasing asset Y, i.e., ETH.
This purchase action increases the slippage (based on the volume to be traded and the available liquidity, projected price increase or fall) and boosts the price of asset-Y for the victim trader. Because of the high purchase of asset Y, its price rises, and the victim purchases asset Y at a higher price, which the attacker then sells at a higher price.
Another way of front-running includes a displacement attack in which the miner's transaction replaces the original transaction; the replaced transaction can still be completed, but the result will not be as intended.
Is front-running illegal in crypto?
Front running is considered illegal in the traditional stock market because outsiders are not provided with insider information. However, in the crypto market, all information is stored in a publicly auditable digital ledger. Therefore, front-running NFTs is not considered to be illegal.
The internet's power to disseminate information increases front-running in the cryptocurrency market. While front running is banned in traditional trading because the trader is utilizing non-public data, the trader on a decentralized exchange (DEX) is using data publicly available on the blockchain and is not technically shorting the system.
If you know the list of buy or sell orders ahead of time and can insert your order before other trades are inserted, front-running as a DEX trading strategy is beneficial. The trader will be able to see incoming orders locked into smart contracts on the decentralized exchange if it is built on top of a public blockchain (e.g., Ethereum). The trader can then establish a higher cost for placing the order than the incoming orders if it is commercially feasible. The trader will be able to claim more lucrative orders as a result.
What is a front-running bot?
A front-running bot scans pending transactions and pays a more significant gas fee so that miners process its transaction first to front-run a major trade that will affect market pricing.
Bots are pre-programmed programs that allow you to automate your trading. Rather than keeping track of every move in the market and waiting for a good time to buy and sell, the bot will automatically synthesize and assess market data and make asset transactions on behalf of customers. But, how do crypto front-running bots work?
Ethereum's or the blockchain's design permits all submitted transactions to halt in a mempool, where transactions are waiting to be processed. The mempool can be scanned by miners or bots for appropriate transactions to be utilized for front-running in cryptocurrency trading.
Front-runner bots typically work on a millisecond timescale. For example, they may read a transaction from the mempool, compute the optimal transaction size, configure the transactions and then execute them in a fraction of a second. It's impossible to compete when manually operating.
By putting a buy order on the same block and simultaneously setting a higher gas price, the bot front-runs particular slippage, trade volumes and gas price transactions. When additional liquidity is added to an AMM (automated market maker) pool on the exchange, the front-run bot recognizes it and manipulates the order of transactions within a block to profit from another trader.
What is front-running in the NFT markets?
Front-running is a stock market phrase that refers to using insider information about impending deals to enter the market ahead of the competition. As a result, it's a type of insider trading.
Furthermore, with that knowledge, they can buy an NFT before it gets featured, ultimately raising its price. The price rises because the NFTs are publicized to sell and the insider makes a tidy profit.
Therefore, front-running of this kind is called insider trading, as the assets are traded based on non-public information. For instance, In September 2021, Nate Chastain, the head of product at the NFT marketplace OpenSea, was discovered to have purchased NFTs just before they were highlighted on the OpenSea site. He then sold them for a profit.
He took advantage of insider information, such as which NFTs OpenSea would push, to obtain an unfair advantage. However, an enterprising individual discovered this illegal activity by matching the NFT transaction timestamps to the top page promotions of the NFTs in question on OpenSea.
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Coming every Saturday,Hodlers Digestwill help you track every single important news story that happened this week. The best (and worst) quotes, adoption and regulation highlights, leading coins, predictions and much more a week on Cointelegraph in one link.
The creators of the wildly popular Bored Ape Yacht Club NFTs, Yuga Labs, raised $450 million in seed funding at a $4 billion valuation. Unsurprisingly, top venture capital firm and cash cow Andreessen Horowitz (a16z) led the round.
Yuga Labs, which also recently launched ApeCoin and announced an upcoming metaverse platform, intends to use the funds to increase its employee base, attract more creative, engineering and operations talent, as well as support joint ventures and partnerships.
Yuga Labs has been stacking wins over the past 12 months, with CEO Nicole Muniz emphasizing that theres a lot to come given the new economy of intellectual properties in the company’s roster. Yuga Labs recently bought the IP of CryptoPunks and Meebits from Larva Labs and plans to give full commercial rights to NFT holders.
In a bit of self-aware humor, Cardano founder Charles Hoskinson pointed out that his prediction about there being thousands of assets and DApps on the network by 2021 fell short significantly.
He made the comments on Twitter but appeared to misremember his own words, as he had predicted back in July 2020 that, by 2021, there would be hundreds of assets and thousands of DApps on Cardano.
The number of assets appears to have exceeded expectations thanks to NFT minting platforms; however, DeFi Llama lists a mere seven DApps on the blockchain, accounting for a total of $315.72 million total value locked (TVL).
Bloombergs highly clued-in ETF analysts Eric Balchunas and James Seyffart have suggested that a proposed rule change within the U.S. Securities and Exchange Commission (SEC) could result in the regulator approving a BTC spot ETF by mid-2023.
Balchunas stated on Thursday that crypto platforms could fall under the SECs regulatory framework if the commission were to approve the amendment to the Exchange Act proposed in January, which would change the definition of exchange. The move would enable crypto platforms trading any type of security to be included under the act.
Once crypto exchanges are compliant, the SEC’s primary reason for denying spot Bitcoin ETFs would no longer be valid, likely clearing the way for approval, said the analysts in a joint statement.
Cross-chain protocol Stargate Finance has attracted more than $1.9 billion worth of TVL in less than a week since launching.
The platforms rapidly growing TVL is most likely a result of the cap of 26% APY offered for farming stablecoin deposits. Stargate Finance touts itself as a protocol that enables users to transact native assets across various chains. Users can also stake assets in pools to receive Stargate token (STG) rewards.
Alameda Research CEO Sam Trabucco announced that the firm had heavily backed the project, snapping up all available Stargate tokens that had been auctioned off during Stargates launch on March 17.
Crypto use in Africa surged a mammoth 2,500% in 2021, according to a report from crypto exchange KuCoin.
The report cited interesting data, such as more than 88.5% of cryptocurrency transactions made by Africans being cross-border transfers. It argued that the low fees mean that users pay less than 0.01% of the overall amount of the transaction transferred in cryptocurrencies.
Johnny Lyu, CEO of KuCoin, told Cointelegraph that the adoption of digital assets in Africa will continue to grow exponentially, adding that African countries have the highest crypto adoption rate in the world, outperforming even the biggest regions, such as the United States, Europe and Asia.
Winners and Losers
At the end of the week, Bitcoin (BTC) is at $44,118, Ether (ETH) at $3,136 andXRPat $0.83. The total market cap is at $2 trillion,accordingto CoinMarketCap.
Among the biggest 100 cryptocurrencies, the top three altcoin gainers of the week are Ethereum Classic(ETC)at 79.59%, Loopring(LRC)at 57.71% and Bitcoin Gold(BTG)at 53.40%.
The top three altcoin losers of the week are ApeCoin (APE) at 8.09%, UNUS SED LEO (LEO) at 2.85% and Maker (MKR) at 2.02%.
Avoiding scams should always stem from a common history with the requestor i.e., to determine if they are who they claim they are to ask for a common reference. (Yesterday, this type of question was the first I asked this scammer, and the response almost confirmed that hes not John.)
Remember when I predicted thousands of assets and DApps on Cardano? Well I was wrong, there are now millions of native assets issued and DApps are now in the hundreds. #SlowAndSteady.
You will continue seeing us take that approach as we try to shepherd companies into Web3. A lot of this is driven by how do we accelerate the adoption of Web3? because one of the bigger risks as we see it, is that if people dont move into the space quickly enough then inadvertently we will perhaps also create another kind of elite.
Yat Siu, co-founder and chairman of Animoca Brands
We have seen the statistics about how few women are part of crypto by comparison, which kind of mirrors the inequality we see in other financial markets. […] Cryptocurrencies started with the goal of being accessible to everyone and breaking down barriers to entry.
Take a look at the way in which cars, mobile phones and consumer electronics took off on the continent. Africa is a continent where lightning-fast progression and adoption is common.
If you want to be a pioneer on the virtual frontier of innovation, Australia is open for business. As the Minister for the digital economy and the Minister for financial services, I am backing you.
You cant solicit funds for a business opportunity, abandon that business and abscond with money investors provided you. Our team here at IRS-CI and our partners at HSI closely track cryptocurrency transactions in an effort to uncover alleged schemes like this one.
Thomas Fattorusso, special agent-in-charge at IRS Criminal Investigation
With the price of Internet Computer (ICP) on a surge of late, Cointelegraphs Yashu Gola has read the charts and outlined a bullish scenario in which ICP reaches the $27 region by next month. The move would mark a hefty 50% gain since it was priced at around $17.75 on Tuesday.
Gola pointed to a convincing falling wedge breakout in action backed by an increase in trading volumes and continual price inclines.
In a perfect scenario, breaking out of a falling wedge pattern to the upside can see a subsequent price rally by as much as the maximum distance between the wedge’s upper and lower trendline. That may put ICP en route to over $27 by almost 50% sometime by April, Gola said.
Thailands Securities and Exchange Commission has banned crypto payments after discussing its implications with the Bank of Thailand (BOT) via a joint study. Some of the risks highlighted by the SEC include a lot of common critiques of crypto, including price volatility, cyber theft, money laundering and personal data leakage.
Businesses found in non-compliance with the new crypto laws will be subject to legal actions including temporary suspension or cancellation of the services.
[Crypto payments] may affect the stability of the financial system and overall economic system including risks to people and businesses, the joint study conducted by the BOT and SEC concluded.
The Li Finance swap aggregator protocol was the victim of a smart contract exploit that resulted in the loss of $600,000 worth of tokens, including USD Coin (USDC), Polygon (MATIC), Rocket Pool (RPL), and Gnosis (GNO), to name a few.
During the early hours of the morning of March 20, the hacker was able to extract varying amounts of 10 different tokens from wallets that had given infinite approval to the Li Finance protocol. The team found out about the hack an eye-watering 12 hours later and shut down all swapping functions on the platform in order to prevent any further losses.
The team said that the attacker swapped the stolen tokens for a total of about 205 Ether (ETH) valued at roughly $600,000.
The founder of crypto investment firm DeFiance Capital, pseudonymously known as Arthur_0x, lost a whopping $1.6 million worth of NFTs and crypto via a hot wallet hack.
After asking the community to help blacklist the hackers wallet, many people also jumped in to help retrieve some of the stolen assets. An NFT proponent going by the pseudonym Cirrus even went as far as to buy two of the stolen Azuki NFTs and return them to the founder at cost.
Cirrus told Cointelegraph on Tuesday that he found out they were hacked, and instead of selling them for profit like the other folks who got some of [Arthur_0x’s NFTs], decided Id sell them back to him at cost to help him out.
Powers On is a monthly opinion column from Marc Powers, who spent much of his 40-year legal career working with complex securities-related cases in the United States after a stint with the SEC. He is now an adjunct professor at Florida International University College of Law, where he teaches a course on Blockchain & the Law.
At the end of the week, Bitcoin (
Thailand SEC bans crypto payments, seeks disclosure of system failure from exchanges
Powers On Biden accepts blockchain technology, recognizes its benefits and pushes for adoption