Bitcoin Breaches $20,000

Bitcoin, Blockchain, Crypto, Cryptocurrency, Coin

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Bitcoin has soared above $20,000 for the first time since November last year, as the cryptoasset continues a stunning run of form. Having traded below $16,300 on the eToro platform at the end of last year, bitcoin has surged up 29% to now trade just below $20,900.

Ether has seen a similar bounce, trading to just above $1,550 for the first time in two months. Last week ETH began below $1,300, marking a 19% gain in just seven days. 

Cryptoasset markets are surging even as traditional equity markets see some revival. A mixture of news, including inflation slowdowns in the US, have cheered markets but the revival for crypto has been much more energetic than that of other asset classes.

We’re in the early days yet so caution is most definitely warranted for investors. At times like this markets have a habit of being knocked sideways any given day we have bad news. Long-term investment cases and time horizons are still fundamental. 
 

Bitcoin mining difficulty hits fresh ATH

Bitcoin’s mining difficulty has set fresh all-time highs as of Sunday, rising 10.26% to 37.73 trillion. This comes as the bitcoin hash rate set a new ATH on 6th January too. The difficulty and hash rate generally rises because of more competition between miners effectively crowding the network.  

An abundance of miners and high levels of competition on the network, which forces up the hash rate, is broadly a good thing. Although it doesn’t correlate to price, the more miners on the network the more secure it is. 

It is also a signal that is common during or after bearish episodes where background usage and development keep going despite headline price falls and can be construed as a positive long-term indicator. 

Miners have had difficulty in recent months as the price of bitcoin has wallowed at low levels, but with increases now taking place, they could find their operations become more profitable again. 
 

Shiba Inu layer 2 blockchain ‘Shibarium’ moves closer

A layer 2 blockchain development for cryptoassset Shiba Inu coin (SHIB) is moving closer to fruition with developers publishing details of how the project will work and the imminent arrival of the Shibarium Beta.

The most important aspect of Shibarium is to allow greater scalability and faster transactions for SHIB tokens. It also increases the use cases for developers such as NFTs and the provision of transaction fees to counteract spikes in the gas costs on the network. 

Introducing a layer 2 chain to a cryptoasset’s ecosystem can be a controversial development. Typically it is done when the original chain suffers from certain issues, such as slow transaction times, and requires developers to build another network on top of the original to improve functions and performance. 
 

El Salvador is one step closer to bitcoin bonds

El Salvador has moved one step closer to offering bitcoin bonds - so-called volcanoes bonds - after the country’s congress approved legislation for their launch on Wednesday. The volcano bonds have been designed to help the country - one of the first in the world to adopt bitcoin as an official currency - to raise funds to build its so-called Bitcoin City. 

President Nayib Bukele, who has been the face of the entire bitcoin endeavor in the country, wants to build a city-funded by bitcoin that mines using geothermal energy from El Salvador’s many volcanoes. 

The new legislation allows the country to offer digital securities in the form of sovereign blockchain bonds, backed by bitcoin assets the country has accrued. El Salvador’s congress overwhelmingly approved the plan, but we are yet to see these assets for sale on the open market.


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Disclaimer: This article should not be taken as investment advice, personal recommendation, or an offer of, or solicitation to buy or sell, any financial instruments. This material has been ...

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