Blockchain and Cryptocurrency News Roundup

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  • November 9, 2020
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9 November 2020.

Dive into a short summary of some of the biggest headlines in Crypto this week. Family offices may now see Bitcoin as alternative to gold: JPMorgan Report, another mysterious Satoshi-Era Bitcoin move—$30 million transfer, US government now holds $1 billion in Bitcoin after Silk Road seizure using blockchain analysis & bull flag breakout will decide whether Bitcoin price goes to $16K or $14K.

Family offices may now see Bitcoin as alternative to gold: JPMorgan Report

The GrayScale Bitcoin Trust is outperforming gold exchange-traded funds, a trend perhaps driven by institutional investors like family offices, according to a report by JPMorgan analysts that CoinDesk obtained. “This contract lends support to the idea that some investors that previously invested in gold ETFs such as family offices, may be looking at Bitcoin as an alternative to gold,” the analysts wrote in the Nov. 6 report. The climb of the Grayscale Bitcoin Trust indicates it’s not just millennials driving demand for bitcoin, but institutional investors like family offices and asset managers, the analysts said. Grayscale is part of Digital Currency Group, CoinDesk’s parent company. The analysts continued: “As we had highlighted in our previous [report] of October 23rd, the potential long-term upside for bitcoin is considerable if it competes more intensely with gold as an ‘alternative’ currency given that the market cap of bitcoin would have to rise 10 times from here to match the total private sector investment in gold via ETFs or bars and coins.” The analysts noted, however, that the “sharp spike in prices this week appears to have taken bitcoin close to overbought levels” which could trigger a sell-off.


Another mysterious Satoshi-Era Bitcoin move—$30 million transfer

Bitcoin worth over $30 million that had previously been sitting around in idle wallets “awakened” this weekend in four transactions. Satoshi-era Bitcoin moved for the first time Friday—when 50 coins now worth over $700,000 moved to a single address. It hadn’t previously been touched since 2010. The same thing then happened last night, when another previously untouched “sleeping” 50 Bitcoins were moved. Just seven hours later, 20 wallets moved a total of 1,000 Bitcoin—worth $15.5 million—to a single address. And today, the exact same thing happened again: 20 wallets holding 1,000 Bitcoin moved to a single address, bringing the total of Bitcoin “awakened” to $32.6 million. It isn’t clear who moved the Bitcoin or why they decided to transfer it to another address but the Satoshi-era coins were mined back in 2010—when the currency was worth peanuts. Crypto trader Kirill Kretov flagged the move on LinkedIn. He told Decrypt that the Bitcoin possibly moved because the current price of Bitcoin “is good enough to sell some portion of holdings.” He added: “But surely I can’t know what is in the head of such a true holder. I guess it’s hard for them to travel due to various metal detectors.” Satoshi era Bitcoin refers to coins mined when Bitcoin’s pseudonymous creator, Satoshi Nakamoto, was still communicating with the crypto world. Nakamoto’s identity is still unknown and no one has heard from him since 2010. If the owner of the coins moved yesterday were to sell them now, the profits would be astronomical: in 2010, 1 Bitcoin was worth less than $0.10. Today the cryptocurrency is trading for $15,342.56, according to CoinMarketCap. This isn’t the first time this year Bitcoin that previously had been collecting dust has been moved. Just last month, $11.4 million worth of Bitcoin was moved. It had also been sitting in an idle wallet since 2010.


US government now holds $1 billion in Bitcoin after Silk Road seizure using blockchain analysis

The United States Department of Justice (DoJ) recently requested the Northern District of California to seize $1 billion in Bitcoin from an unnamed hacker. The DoJ has asked to lock down approximately 69,370.22491534 Bitcoin (BTC), Bitcoin Gold (BTG), Bitcoin SV (BSV), and Bitcoin Cash (BCH). The person behind the wallet referred to as “Individual X,” has allegedly managed to hack the Silk Road to steal the cryptocurrencies. Individual X has agreed to sign over the funds earlier this week, making the funds the largest crypto seizure in Bitcoin history. The address “1HQ3Go3ggs8pFnXuHVHRytPCq5fGG8Hbh,” now contains crypto assets that are worth over $1 billion dollars. This address was Bitcoin’s fourth-largest address which was dormant for around five years up until a few days ago. The Bitcoin wallet address was tied to Silk Road, which was operating between 2011 to 2013 as a dark web marketplace facilitating transactions of illegal goods including drugs and unlicensed weapons using BTC. According to Ciphertrace on Nov. 3, the BTC was moved in two transactions and equated to almost one billion dollars in Bitcoin. The anonymous crypto user reportedly first sent a test transaction on 1 BTC, before then moving a further 69,369 Bitcoin from the Silk Road wallet address. Chainalysis, a blockchain analytics firm supported law enforcement agents to identify the largest wallets with connection to Silk Road. The blockchain analytics firm used the Chainalysis Reactor, following the money from Silk Road, to another wallet, then subsequently to Individual X’s wallet. It was then found that Individual X liquidated some of the funds, but most of the funds were still held in the individual’s wallet as Bitcoin’s price surged, until they were seized and moved to the US government’s wallet. With the seizure of digital assets, the US government has become one of the biggest holders of BTC. Previous similar incidents involving BTC held in authorities’ custody have been sold at federal auctions.

Bull flag breakout will decide whether Bitcoin price goes to $16K or $14K

Bitcoin price (BTC) appears to be taking a short breather after reaching a new 2020 high at $15,960 on Nov. 5. The 1-hour and 4-hour timeframe show the price compressing within a flag and throughout the majority of the trading day, the $15,500 level has held as support. $15,750 is the level Bitcoin needs to break in order to pursue another stab at $16,000. 

Within the last hour, a dragonfly doji candle formed as the price swept low to test the lower support of the bull flag at $15,166, and as the formation approaches its terminus traders will look for a breakout which will push through the $15,500 to $15,600 level where a high volume VPVR node lurks. Clearly, there is a small tussle taking place between bulls and bears, and flipping the $15,600 level to support with a 4-hour close will increase the possibility that BTC will make a third run at the $16,000 mark. The RSI also continues to rise above 70, a bullish signal, but daily purchasing volume has tapered off a bit after some traders secured profits as BTC surged to $15,900. Alternatively, a drop below the flag support at $15,100 opens the door for a touch of the 20-MA at $14,680. The swift, nearly vertical breakout that occurred from Nov 4 – 5 occurred without establishing any ‘new supports’, and as the volume profile, visible range shows there is a gap extending from $13,900 to $15,500. In the event that the price falls below $15,100 and buyers don’t perceive this as a dip-buying opportunity, there is the possibility of a retest of the $14,000 to $13,800 level as support. While a 9%, $1,400 drop is unnerving, lower support retests are perfectly natural and healthy after strong rallies like the one seen this week. As Bitcoin price searches for direction, altcoins have regained a smidgen of the vast territory lost over the past two months. Ether (ETH) is the most notable leader of the past few days as the altcoin rallied to $447 and is currently attempting to break through resistance at $450. Yearn Finance (YFI) also made a strong move as it rallied more than 30% to $11,100. Uniswap’s UNI token also made waves as it added 15.5% and currently trades at $2.53. According to CoinMarketCap, the overall cryptocurrency market cap now stands at $444.6 billion and Bitcoin’s dominance rate is 64.7%.


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