“According to on-chain data, institutions have continued their purchases of bitcoin despite the volatility and near-term bearish market sentiment.
The number of the total bitcoin transactions on the network remains high. However, most transactions were done through over-the-counter (OTC) deals, a preferred approach by institutional investors.
93% of transactions in the Bitcoin network is used for non-exchange transactions like OTC deals.
Institutional investors really piled into the bitcoin space after Paul Tudor Jones announced his entrance, and they didn’t stop as 2020 came to a close. There is little reason to assume institutional interest in the bitcoin space will suddenly disappear in 2021.
The recent price volatility is due to “over-leveraged” speculative traders and retail investors who found themselves “weak-handed,” according to OKEx Insights Senior Editor Adam James.”
See Also: Bitcoin as a last resort? Murmurs of crypto as reserve currency abound (Good read)
“1. CME Ethereum Futures:
The world’s largest derivatives platform, the Chicago Mercantile Exchange (CME), publicly announced on Dec. 16 its plans to launch Ethereum futures by Feb. 8, provided it receives regulatory approval from the U.S. Commodity Futures Trading Commission (CFTC). This is beneficial because it will give institutional investors in particular the opportunity to hedge spot positions, which reduces overall risk and in turn makes Ethereum a much more attractive investment.
2. Ether Burning and Predictable Fees:
Right now, transaction fees are determined via an auction-style system where users who attach the highest fees to their transactions get them processed the quickest by miners. This system causes a number of issues, namely unpredictable and often extremely high fees during periods of heavy congestion.
EIP 1559 suggests scrapping the current auction-style fee system in favor of an algorithmically determined base cost, called the “BASEFEE.” The BASEFEE aims to introduce a uniform fee across all ethereum-centric platforms and services that rises and falls depending on network activity. This means no more fee discrepancies between ERC-20 compatible wallets, protocols, and exchanges.
The second function of EIP 1559, and the one that will likely have the greatest impact on Ethereum’s future price, is the introduction of burning ether. Burning means completely removing tokens from existence, causing a reduction in the circulating supply. EIP 1559 plans to burn the BASEFEE so the vast majority of the ether used to process transactions is destroyed as opposed to being given to network validators.
3. Ethereum 2.0 Phase 1 Rollout:
Phase 1 is the next stage in Ethereum’s development and will see the launch of 64 shard chains. All transaction activity across the network will eventually be divided among and processed by these separate blockchains. The benefits of this new system will be that transactions won’t need to be validated by the entire network, only by a single shard chain. This will greatly reduce the time it takes to confirm transactions, and it means the overall network will be capable of handling significantly higher volumes without suffering the level of congestion it currently does.”
“New numbers published on the Coinbase “About” page Friday show the exchange now has over $90 billion in assets on platform and over 43 million registered users.
Coinbase’s asset surge is likely driven by the likes of MicroStrategy, Ruffer Investment and other institutions that have used the exchange’s prime brokerage service to make large bitcoin buys in recent months.
Assets under the control of Coinbase Custody accounted for “more than 50%” of the $90 billion total, the report states, adding that Coinbase executed ‘single trades exceeding $1 billion for some of the largest institutions in the world.'”
“VanEck’s new ETF is called the Digital Assets ETF. The new fund would track the price and performance of the Global Digital Assets Equity Index run by its subsidiary MV Index Solutions.
Digital asset companies refer to companies that operate digital asset exchanges, payment gateways, mining operations, software, equipment and technology or services to the digital asset industry, and others.”
“Tether Ltd.’s Bahamas-based bank, Deltec, said on Friday that the company’s stablecoin is fully backed by reserves, downplaying resurgent fears about the cryptocurrency’s integrity.
Every tether is backed by a reserve and their reserve is more than what is in circulation. We can see it first hand, so I can confirm that.
Reserves are said by Tether on its website to include ‘traditional currency and cash equivalents and, from time to time, may include other assets and receivables from loans made by Tether to third parties, which may include affiliated entities.'”
“Over the past three weeks the price of REN has increased by more than 200%, going from $0.251 on Dec. 27 to a new all-time high of $0.778 on Jan. 20 driven by a record $369 million in 24-hour volume.
Three reasons for the recent price surge in the price of REN include the announcement of a collaboration with Google, the continued increase in total value locked on the platform and the ability to earn passive income in multiple cryptocurrencies through the operation of a darknode. Asylo is an open and flexible framework from Google designed to help build portable applications that run on Secure Enclave hardware.
The rapid growth of DeFi, its ever expanding total value locked and soaring ETH gas fees further highlight the sector’s need for a layer 2 option that also supports the ability to transact value across different networks.”
“The Bank of International Settlements (BIS) Innovation Hub listed its priorities and programs for 2021 Friday, among which will be a new platform for testing wholesale central bank digital currencies (CBDCs).
The “proof of concept” platform will use multiple CBDCs ‘to explore the feasibility of faster and cheaper cross-border payments.’“
“Sber, Russia’s largest retail bank, has applied for a license with the country’s central bank to issue its own digital token for corporate clients.
This stablecoin will allow companies to use smart contracts on Sber’s platform based on the Hyperledger Fabric blockchain. Tokenizing both material goods and fiat money on this platform will allow transactions to be fully automatic.
Sberbank, is the first Russian mainstream company that has publicly announced an application for a digital asset registration with the central bank. The Bank of Russia itself has been exploring the possibility of launching a Russian ruble-backed central bank digital currency (CBDC), the digital ruble.”
“While van der Laan’s work is mostly “janitorial” in nature, making sure the project’s code proceeds smoothly, some in the community view him as a leader of sorts. He thinks this move will help to decentralize the project, a digital currency that is supposed to not have any leaders.
His announcement comes after finding himself in the midst of controversy on Thursday. Some Bitcoin users didn’t like his decision to pull the white paper from bitcoincore.org, following legal threats from Craig Wright.
He has asked other developers to step up to take his place as the leader of the weekly Bitcoin Core development meeting, where developers discuss pressing next steps.”
“Blockchain-based supply-chain provider SUKU today unveiled a new microfinancing ecosystem that will provide lending services to farmers, ranchers, and other small businesses. SUKU says the mission of its SUKU DeFi protocol is to incentivize the participation of people who might not have access to financial services such as microlending.
What makes SUKU’s mission especially interesting is that it focuses on people that might not have access to a stable Internet connection necessary to use most DeFi products. Users can interact with the SUKU DeFi protocol via SUKU’s TextMeCrypto service, which facilitates sending, receiving, and swapping ERC20 Tokens via SMS text or WhatsApp.
SUKU DeFi is live, and TextMeCrypto is live on the Kovan testnet with a scheduled mainnet release in early this year.”