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It is the price action in the markets that has attracted attention over the past week. Unlike many times in 2022, however, luckily it’s for the right reasons! The cryptocurrency market had a promising start to the year, reaching a market capitalization of $1 trillion for the first time since November last year. We are currently navigating one side or the other of this key level.

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The price of Bitcoin has stabilized above $21,000 in recent days, allowing the currency to recover to the previous level before the bankruptcy of the FTX exchange. It took a little over two months to put this crisis behind us, at least on the bitcoin valuation side. Nearly $500 million in short positions have been liquidated since Friday, marking the highest level since October 2022. This latest price move also comes as the difficulty of bitcoin mining has increased by more than 10% for hit a new high of 37.59 T, against 34.09 T last Sunday. Recall that mining difficulty measures the difficulty in solving the cryptographic puzzle required to create a block on the Bitcoin network. The difficulty is adjusted every two weeks, and the next adjustment is scheduled for January 28. An increase in mining difficulty is generally seen as a sign of a network’s strength and growth, indicating renewed confidence in the overall market. However, this comes at a cost to miners who have to spend more resources to generate the same amount of coins as before.

The current price zone also has an important bearing on the sentiment of the net players. According to data from Glassnode, the current cost to mine one bitcoin is around $18,800. Considering that bitcoin is currently trading above $20,000, this means that average mining companies can once again operate profitably. This increase also allows more than 50% of the circulating supply of bitcoin to be acquired.

“Many of these patterns tend to act as important psychological resistance levels during bear markets, making this particular event newsworthy,” Glassnode analysts wrote. The rally – which began last week and accelerated over the weekend – can be attributed to signs of cooling US inflation. With a price tag of over $19,000, Glassnode thinks miners can now earn more bitcoins from mining than it costs to run their power-hungry machines. Also, the average holder has bought BTC at a lower price, which means they can sell it at a profit.

Cryptocurrency conglomerate Group of Digital Currencies, including the owner of Genesis and Grayscale Bitcoin Trust, informed its shareholders that the company was suspending dividends until further notice. “In response to the current market environment, DCG has focused on strengthening our balance sheet by reducing operating expenses and preserving cash. We have therefore taken the decision to suspend the distribution of DCG’s quarterly dividend until further notice,” DCG said in a letter to shareholders sent on Tuesday. Apart from this decision, there has been no apparent progress on the issues of Genesis liquidity.

On FTX’s part, it has learned, according to a presentation made Tuesday before FTX’s creditors’ committee, that a significant portion of the $181 million in assets held by FTX US, the US arm of the bankrupt crypto company, was subject to of “unauthorized transfers made by third parties” after bankruptcy. Unauthorized transfers made on FTX.com’s main platform grabbed headlines after hundreds of millions of dollars were moved a day after the company filed for bankruptcy protection under the law. Chapter 11 on November 11. However, the $90 million that was moved from FTX US has not been disclosed by the company until now. According to FTX’s presentation, $88 million of FTX US’s remaining assets have been transferred to a cold portfolio and another $3 million is pending transfer to the same portfolio. The following infographic was shared:

Coinbase has confirmed that it will shut down its operations in Japan within weeks, citing the current difficult market conditions. “Due to market conditions, our company has made the difficult decision to cease operations in Japan and conduct a complete review of our operations in the country,” the San Francisco-based company said. “However, we are committed to making this transition as smooth as possible for our valued customers.” Note that the Kraken exchange made the same announcement. For its part, Binance is instead trying to re-enter the market, after the company left it in 2018.

After heated debate from community members, Polygon has finally decided to move forward with it hard fork. The latter was implemented without technical problems yesterday. It seeks to increase the speed of transactions and reduce the spikes in transaction prices that occur during times of congestion.

Wallets holding Ether are well on their way to surpassing the 100,000,000 mark soon. On Monday, this threshold crossed 92.5 million for the first time. As of 2019, this figure has increased by about 20 million per year. If this pace continues, it is likely that non-zero ETH wallets could reach 100 million by Q2 2023.

More than 16 million ethers have been deposited into the contract standing upof Ethereum. This figure of 16 million ETH accounts for more than 13.28% of the total supply of Ether and represents almost $22.38 billion at current prices. It comes almost two years after Ethereum’s share contract went into effect in 2020. It will be impossible to withdraw the $22.38 billion of ETH placed in this contract until Ethereum’s next major upgrade. ‘Ethereum. While the growing number of ETH pledged could be interpreted as a promising sign for Ethereum’s security and adoption, it could increase the pressure on network developers to speed up work to enable withdrawals.

The rise in the price of bitcoin has been accompanied by a massive increase in trading volume. Over the past week, BTC volume has more than doubled to $10.8 billion, a 114% seven-day increase. Increased volume is generally associated with increased volatility. However, so far this has not really happened. On-chain analytics are also showing positive signs that bitcoin’s recovery is potentially underway. The more the market is able to absorb selling pressure without price capitulation, the less overall market fear and potential macroeconomic change.

Finally, note that bitcoin’s 30-day correlation with the Nasdaq reached 0.29 on January 17, BTC’s largest divergence from the stock index since December 2021. Equity markets may continue to fluctuate due to inflation elasticity high, but bitcoin’s divergence from the stock market could help BTC become the future many envision for it, one of a safe haven rather than an exclusively risky asset.

The capital of the fund is obviously fully invested, mainly in BTC and ETH.

This article is brought to you by Fonds Rivemont. The Rivemont Cryptocurrency Fund is Canada’s first and only actively managed cryptocurrency fund. RRSPs and TFSAs eligible. Accredited investors can learn more here.

Disclaimer: This column does not necessarily reflect the opinion of CryptonewsFR and does not constitute investment advice or trading instructions..

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