To enter MRP's research library, click here. |
|
|
|
|
|
Welcome to MRP's Weekly Crypto Wrap, a look back at news reports, on-chain metrics, and other data that moved digital asset markets over the past week. These reports will be delivered every Friday morning, provided free of charge by MRP, and packed with useful information for those just beginning their research into Bitcoin and other cryptocurrencies, as well as investors with more experience in digital asset markets.
Click here to see everything we covered in the last iteration of the newsletter. |
|
|
|
THEMATIC SIGNALS Aggregation of key events and breaking stories monitored by MRP |
|
|
Bitcoin: 91% of Cryptos From 2014 Have Died, While Bitcoin Continues to Thrive |
Ethereum: Nearly $9B worth of ETH was burned in 1.4 years |
Stablecoins: Declining Demand for Binance's BUSD Represents New Chapter in Stablecoin Wars
|
Payments: One Million Commerce Payments Made with Crypto Last Year
|
Miners: Bitcoin Miner Core Scientific Reaches Agreement To Shut Off Celsius Mining Rigs
|
|
|
|
ON-CHAIN ANALYTICS Breaking down the most critical trends and transaction patterns on the blockchain |
|
|
Earlier this week, on January 3, Bitcoin (BTC) celebrated its 14th birthday. That is, 14 years to the day that its genesis block was mined and the first transactions on the network were verified, which should prompt a bit of a review of Bitcoin’s history and how it all works into today’s price. Following the genesis block, it took six days for the second block to be mined, but throughout the rest of Bitcoin’s lifespan since, a new block, containing an average of nearly 1,800 transactions these days, has been mined every 10 minutes. That taut schedule is maintained by autonomous adjustments of the Bitcoin network’s mining difficulty, which changes every 2,016 blocks (approximately two weeks’ time) to accommodate for the number of miners utilizing the network, as well as gradual improvements in hardware speeds. More than 770,600 blocks on from genesis, here we are today with Bitcoin’s immutable ledger continuing to process transactions endlessly, having settled tens of trillions of dollars. In 2022 alone, $8.2 trillion was transferred via the Bitcoin blockchain. That figure works out to an average of $260,000 per second.
If we go back to the first transaction denominated in USD, which occurred on October 12, 2009 and involved the sale of 5050 BTC for $5.02, we can calculate an initial exchange rate for BTC-USD at $0.00099. From there to an all-time high near $70,000 in 2021, and now back to about $16,700 as of this morning, the network simply keeps operating irrespective of these fluctuations. Total uptime for the Bitcoin network since its January 2009 launch is equivalent to 99.99%, 24 hours and 7 days per week.
Though the price volatility of Bitcoin continues to gradually stabilize throughout each of Bitcoin’s halving cycles – every four years, the amount of BTC mined per day is cut in half – Bitcoin has fallen into a particularly stable price pattern as of late. According to Ecoinometrics, the 30-day rolling volatility of BTC has fallen very close to the bottom of the current halving cycle’s volatility distribution.
Part of that recent stability likely has to do with a larger share of the supply being accumulated by “strong hands”, those who have little proclivity to sell their Bitcoin as the price falls. The durability of these bear market buyers can be measured through on-chain metrics, particularly how long a certain share of BTC’s circulating supply has gone unspent. Roughly 66.4%, or slightly more than two-thirds of the supply, has not moved in a year or more. That has fallen from an all-time high of 66.9% in November, but longer-term gauges, including coins that have been unspent for more than two years have continued to make new all-time highs. Per Glassnode, the percentage of BTC’s supply last active more than two years ago has is now equivalent to 47.7%.
One final noteworthy trait about the genesis block, which has an interesting connection to the continued distribution of Bitcoin’s network today, is a message encoded into it by Pseudonymous inventor Satoshi Nakamoto. Within the coinbase parameter of the block, the phrase “The Times 03/Jan/2009 Chancellor on brink of second bailout for banks” can be found; a UK newspaper headline for that date and, moreover, a testament to the founding ideal of Bitcoin. Putting aside speculation about its price in dollar terms, Bitcoin’s foundational purpose the creation of means by which every person could essentially become their own bank with sound digital money that could not be debased by any central authority.
As Satoshi himself stated in a 2009 blog post, “The root problem with conventional currencies is all the trust that’s required to make it work”. That issue was exemplified by the failure or near-failure of many banks throughout the financial system in 2008-2009. The mismanagement of humans running such institutions creates risk and many sovereign governments have shown that there is little punishment for massive mistakes resulting from mismanagement of that risk. A “bailout” of banks and the resulting monetary and/or fiscal stimulus required to fight any fallout caused by financial crises, requires inflation of the money supply and, therefore, a large debasement of purchasing power that disproportionately damages those who have relatively little cash and potentially had nothing to do with the catalyst of such crises.
Bitcoin is money with a fixed supply and distribution schedule that cannot be inflated or altered in any other way. It can also be self-custodied to minimize trust in institutions. Recent data from Glassnode and IntoTheBlock show that about 17% of Bitcoin’s total circulating supply is held by retail investors, or entities with 10 BTC ($167,000) or less. That figure has been continually increasing as number of wallets holding 0.01+, 0.1+, and 1.0+ BTC have each set new all-time highs within the past couple of days. |
|
|
|
DIGITAL ASSET DIBs MRP's latest Daily Intelligence Briefings on everything from BTC to DeFi and NFTs |
|
|
|
|
THEMATIC SIGNALS: SUMMARIES |
|
|
Bitcoin
91% of Cryptos From 2014 Have Died, While Bitcoin Continues to Thrive According to CoinKickoff data, 91% of the coins that were present for the 2014 cryptocurrency market crash are now entirely abandoned. A large portion of coins that are now dead were created in 2017, with 704 now-dead coins being created that year. The crown for the single most deadly year in cryptocurrency history goes to 2018, during which 751 coins became defunct.
Read the full article from Bitcoin Magazine + |
|
|
|
Ethereum Nearly $9B worth of ETH was burned in 1.4 years
Since Ethereum (ETH) implemented a token burn mechanism on Aug. 5, 2021, nearly $9 billion worth of tokens have been burned cumulatively. Burning of tokens refers to sending tokens to an address from which the tokens become irretrievable. Gas fees data from Glassnode indicates that the mean gas fee has fallen significantly to around 15-20 Gwei from around 100 Gwei prior to implementation of the burn mechanism.
Read the full article from CryptoSlate + |
|
|
|
Stablecoins Declining Demand for Binance's BUSD Represents New Chapter in Stablecoin Wars
Recent speculation over Binance's health appear to have undermined the progress of its native stablecoin, Binance USD (BUSD), following a spate of $5.5 billion of net redemptions from BUSD in a month. The recent decline in the amount of BUSD outstanding wiped out the gains that came after Binance’s move in September to ditch several rival stablecoins and automatically convert deposits into BUSD
Read the full article from CoinDesk + |
|
|
|
Payments One Million Commerce Payments Made with Crypto Last Year
CoinGate states 927,294 crypto commerce payments were made in 2022, a 63% increase over 2021. Bitcoin dominates, claiming 48% of all payments. In addition, Bitcoin's ultra-low fee Lightning Network experienced payment growth of 97%, accounting for 6.29% of all orders paid in Bitcoin, compared to 4.53% in 2021.
Read the full article from TrustNodes + |
|
|
|
Miners Bitcoin Miner Core Scientific Reaches Agreement To Shut Off Celsius Mining Rigs
One of the world’s biggest Bitcoin miners, Core Scientific has partly blamed its financial woes on its contract with Celsius, after the crypto lender filed for bankruptcy protection in July and stopped covering its share of the electricity bills.
At one point, the company’s lawyers said that Core was losing $53,000 per day on the hosting agreement.
Read the full article from Decrypt + |
|
|
|
|
|
|
|
ABOUT THE DIBS AND MCALINDEN RESEARCH PARTNERS
McAlinden Research Partners (MRP) publishes daily and other periodic reports on the economy and the markets.
MRP focuses on identifying change in the global economy and offering an investment thesis whenever an opportunity arises that has not yet been recognized by the market. The DIBs are MRP's compilation of articles and data from multiple sources on subjects reflecting change that have potential investment implications for an industry or group of securities. We share these with our clients who may already have or may be considering exposure in the industries affected. The subjects change daily and constitute an excellent update on featured topics. |
|
The information provided in this Report is not to be reproduced or distributed to any other persons. This report has been prepared solely for informational purposes and is not an offer to buy/sell/endorse or a solicitation of an offer to buy/sell/endorse Interests or any other security or instrument or to participate in any trading or investment strategy. No representation or warranty (express or implied) is made or can be given with respect to the sequence, accuracy, completeness, or timeliness of the information in this Report. Unless otherwise noted, all information is sourced from public data.
McAlinden Research Partners is a division of Catalpa Capital Advisors, LLC (CCA), a Registered Investment Advisor. References to specific securities, asset classes and financial markets discussed herein are for illustrative purposes only and should not be interpreted as recommendations to purchase or sell such securities. CCA, MRP, employees and direct affiliates of the firm may or may not own any of the securities mentioned in the report at the time of publication. |
|
|
|
|
|