Bitcoin didn’t manage to recover from last week’s losing streak and closed the week with losses, as did the rest of the top 5 cryptocurrencies. Most of them reached their highest prices of the week on Monday, and by Wednesday they had all experienced their lowest prices, with the exception of Bitcoin, which bottomed out for the week on Thursday. Other important developments include the announcement of Binance’s new stablecoin project Venus, possible shake-ups in the Libra Association, and reports of Bitcoin having a market dominance of over 90%.
Here’s what you need to know about last week’s happenings in crypto.
Bitcoin (BTC) started last Monday at $10,350.28, and on Tuesday, hit its highest price of the week at $10,947.04. Its lowest price of the week came on Thursday at $9,831.46, 10.2% lower than two days earlier. On Sunday BTC closed at $10,138.52, having lost 2% of its value during the week. The market capitalization for Bitcoin shrank 7% over the week, closing at $181.5B on Sunday.
Bitcoin 7-day price and market cap chart. Source: COIN360
Ethereum (ETH) opened the week at $194.56 and later that day hit its high for the week at $203.56. Two days later ETH had shrunk 10.3% reached its low for the week at $182.69. On Sunday, the second cryptocurrency by market capitalization closed at $186.84, experiencing a 4% loss throughout the week. Ethereum’s market capitalization closed the week at $20.1B, shedding 7.9% of its size.
Ethereum 7-day price and market cap chart. Source: COIN360
Ripple (XRP) opened on Monday at $0.2823, and on the same day notched its high for the week at $0.2891. Like ETH, XRP also bottomed out for the week on Wednesday, at $0.2607, almost 10% lower than Monday’s peak. On Sunday XRP closed at $0.2701, experiencing a 4.3% decrease over the course of the week. The market capitalization for Ripple shrank 4.9% throughout the week, closing at $11.6B on Sunday.
Ripple 7-day price and market cap chart. Source: COIN360
Bitcoin Cash (BCH) started the week at $316.73, and later that day increased to reach its highest price of the week at $326.88. BCH’s low for the week occurred on Wednesday at $293.93, decreasing 10.1% from Monday’s peak. On Sunday, BCH closed at $305.6, losing 3.5% of its value throughout the week. The market capitalization of Bitcoin Cash tallied a 5.2% loss over the course of the week, closing at $5.5B on Sunday.
Bitcoin Cash 7-day price and market cap chart. Source: COIN360
Litecoin (LTC) opened at $76.34 on Monday. Later on in the day, LTC peaked for the week at $78.51, 11.2% higher than its lowest price of the week, $70.58, which came two days later on Wednesday. On Sunday Litecoin closed at $72.31, having shed 5.3% of its value. Litecoin’s market capitalization closed at $4.6B on Sunday, shrinking by 4.1% over the course of the week.
Litecoin 7-day price and market cap chart. Source: COIN360
The exchange announced on Aug. 19 that its new project would be focused on developing localized stablecoins pegged to fiat currencies around the world. To do so, Binance will be looking to create and establish partnerships with governments, corporations, technology companies, and crypto projects. Binance Venus will make use of Binance’s infrastructure, regulatory establishments, and public chain technology to power the development of stablecoins.
Binance also made headlines on Aug. 23 due to multiple Amazon Web Services (AWS) server shutdowns due to overheating, which led to issues with caching services and withdrawal processing. As a response, Binance disabled withdrawals and deposits temporarily, with CEO Changpeng Zhao assuring users that funds were not at risk due to the network problems. According to an official source, the issue was effectively resolved after approximately 6 hours.
According to reports, BitMax and KuCoin were also affected by AWS server shutdowns.
According to an Aug. 23 Financial Times report, regulatory backlash, which has included an investigation by EU antitrust officials, has resulted in at least three unnamed members of the Libra Association to consider distancing themselves from the project. As per the report, two members are allegedly concerned about regulatory issues, arguing that regulatory talks should have taken place before the white paper was published in the first place, and that supporting Libra now could lead to compliance problems for them. The third member, the report continues, is worried about possibly attracting the attention of supervisory agencies. However, there seems to be tension on both sides of the isle, as Facebook has reportedly grown exasperated by Association members not showing support for Libra.
In an Aug. 19 interview with the Toronto Star, Ethereum co-founder Vitalik Buterin discussed the current state of the blockchain industry. Regarding the roadblocks to massive adoption of the technology, Buterin simply stated: “scalability is a big bottleneck because the Ethereum blockchain is almost full.” A possible way of solving this, he elaborated, would be moving to a network where computers verify only a portion of the transactions, and not every single one of them. The co-founder of Ethereum conceded that this would be a “fairly modest” sacrifice in terms of network security, but it would also bring scalability costs down allegedly by a factor of over 100. He also pointed out that there were challenges related to usability, account security, and privacy that needed to be improved in order to for cryptocurrencies to cross over into widespread adoption.
David Chaum, known for inventing the pioneering digital currency eCash in the 1990s, unveiled the new Praxxis cryptocurrency at the Web3 Summit in Berlin on Aug. 20. Praxxis will feature a consensus protocol that will purportedly help it overcome limitations related to scalability, privacy and security. Praxxis will also leverage the power of its sister platform Elixxir, which was unveiled last September
Along with the release of Polkadot v0.5.0, the morning of Aug. 23 also marked the first deployment of Polkadot’s experimental network, Kusama, wherein new governance, staking and sharding technologies will be working under “real” economic conditions. Kusama will initially run as a PoA (proof-of-authority) network where functionality is highly limited and all validator nodes are run by Polkadot’s parent company, the Web3 Foundation. This initial period will last until anywhere from 50 to 100 validators are bonded, which is expected to occur within one to four weeks. Additional runtime upgrades are to be expected to allow for further testing, but the final upgrade (deployed once the initial period elapses) will remove the Web3 Foundation’s authority over the chain nodes and will introduce Kusama’s Genesis governance system. With this update, Kusama will transition from a PoA network to a decentralized PoS (proof-of-stake) network.
According to an Aug. 22 public statement, the Japanese exchange has begun looking into possible fundraising opportunities that are based only on utility tokens. As Cointelegraph Japan reports, Coincheck is targeting projects that already have content, are looking to grow their business and haven’t raised funds through tokens thus far. The candidates that are being taken into consideration are in compliance with the guidelines from Japan’s Financial Services Agency.
The latest CryptoCompare report shows that AA-graded exchanges had a total aggregate volume of $31B in July, representing only 5% of the total trading volume. This markedly contrasts with the $316B reported from exchanges graded D-E, which accounted for 64% of the total trading volume of the same month. Despite this, AA and A-graded exchanges increased their volumes by 29% and 10% in July, whereas E-graded exchanges saw a 20% decrease in volume compared to that of the month of June. Perhaps unsurprisingly at this point, the largest average trade sizes were reported by low-tier exchanges, even when they reported a substantially smaller amount of daily trades.
This apparent discrepancy between the reported trading volumes of high-tier and low-tier exchanges is closely related to Bitwise’s report in March, where it was discovered that up to 95% of Bitcoin trading volume was artificial, signaling that unreliable exchanges are still misreporting their trade volumes.
Last week Bitcoin dominance was hovering around 70%, but on Aug. 22, Forbes reported that Bitcoin’s share of the total market capitalization may actually be much higher. Analysts at Arcane Research argued that liquidity must be taken into account to get a more accurate measure, and if the data is adjusted for liquidity by calculating the volume-weighted market capitalization, then market dominance shoots up to above 90%. In their analysis, which excluded stablecoins, researchers also noted that this level of dominance makes it harder for other cryptocurrencies to compete with bitcoin, however, they maintained that altcoins still have substantive value, with one Arcane analyst saying that they were “different projects targeting different niches.”
On Aug. 21 Bitfinex shareholder Zhao Dong informed that stablecoin operator Tether is planning to issue a Chinese yuan-backed stablecoin in the near future. Zhao, who pointed out that Bitfinex and Tether are managed by the same team, also stated that RenrenBit, his digital asset management platform, would be the first to invest in the new project. Bitfinex and Tether are currently under investigation after the NYAG’s office filed a complaint against the companies in April for allegedly defrauding New York investors, after an $850M loss on the Bitfinex exchange was covered up with funds from Tether.
In response to Justice Joel Cohen’s Aug. 19 ruling on the Bitfinex/Tether scandal, which dismissed Bitfinex’s motion to throw out the case and concluded that the NYAG does have jurisdiction over the exchange, Bitfinex and Tether issued a joint official statement. In it, the companies express their disappointment in the ruling, reiterating that all accusations of misleading customers about Tether are false. Bitfinex and Tether also stated that they will “continue to vigorously defend against any action by the NYAG’s office.”
Gemini crypto exchange founders Tyler and Cameron Winklevoss are open to working with Mark Zuckerberg on Libra and have been in talks about joining the Libra Association. On Aug. 19 CNN Business reported that the twins are not letting their very publicized settlement with the Facebook creator get in the way of a possible collaboration, although they did mention that they still need to learn more about the project before they decide whether to join the association or not as well as the possibility of listing Libra on the Gemini exchange.
U.S Secretary of State Michael Pompeo commented last Tuesday in an interview with CNBC that the same set of requirements that apply to every electronic financial transaction should apply for cryptocurrencies as well. Pompeo, one of Donald Trump’s closest advisors, also stated that moving in the direction of anonymous cryptocurrency transactions would “decrease the security of the world” and linked the risks of anonymous transactions to 9/11 as the ultimate example of not having good tracking systems.
For the second week in a row, all top five cryptocurrencies ended the week with losses, though this time around losses were not as harsh. However, this week saw the announcement of Binance Venus, which has the potential of issuing multiple stablecoins, backed up by Binance’s infrastructure and reputation; the announcement of a new quantum-resistant cryptocurrency from a pioneer in the field, which also purports to deal with longstanding scalability, privacy, and security issues; and the deployment of an experimental network to test out cutting edge governance, staking, and sharding technologies. Arguably, this is business as usual in crypto, where the newest “next big thing” is announced every other week. More often than not, the results don’t live up to the expectations, and the race continues.
We wish you a great week,
The COIN360 Editorial Team