Crypto weekly update
21. April 2022  • clock 3 min •  Daniel Mitrovsky

Investors show renewed interest in “digital silver”  – Crypto Weekly Update

This week, the total market capitalization exceeded 1.76 trillion EUR. The increase at the 7-day interval is 0.57%. Bitcoin decreased by 0.81% during the week to a current value of over 38,100 EUR. Bitcoin dominance is 41.2%.

Source: Coinmarketcap

Investors Show Renewed Interest in Digital Silver  

In addition to Bitcoin, investors seem to be taking a renewed interest in an asset that has been considered a “digital silver” in the past. The Litecoin network has seen a massive increase in transactions by whales (large investors) around its local price low of $105. The news was shared by Santiment, which released data showing that Litecoin reached its highest number of daily transactions worth above $100,000 in 11 months on April 14, with 5,508 transactions worth over $100,000.

The number of transactions on Litecoin has risen just as cryptocurrencies have entered a period of mild downturn and asset prices are mostly falling or consolidating between strong price supports and resistances. However, whales’ growing number of transactions indicates that they are quietly accumulating the asset at the current price level.

Although the price of Litecoin and other assets has fallen in recent days, the accumulation is a bullish sign in the long term. Another significant milestone has been recorded in the Litecoin network in addition to rising accumulation. The hash rate, or the computational power available on the network for processing transactions, is very close to its all-time high. Usually, when the hash rate of a PoW network goes up, it means the network is very healthy and secure. Source

The Number of Bitcoins on Exchanges Continues to Decline

Data provided by blockchain analytics firm Glassnode shows that the number of coins held on exchanges declined by more than 20,000 BTC to 2,449,785 BTC last week, hitting the lowest levels since August 2018. The number of bitcoins held on exchanges has decreased by 138,266 BTC (almost 5%) since the beginning of the year. Data suggests that buying and holding bitcoins for the long term is still the preferred and most widely used investment strategy.

The decline of bitcoins on exchanges is primarily due to investors sending their bitcoins from exchanges to their private wallets to hold them for the long term. A continued decline in BTC available on exchanges means fewer coins available for sale and the potential for an extended rally.

Additionally, alternative metrics also show certain bullish signals. For example, the percentage of bitcoin inactive for at least a year recently reached a record high of 63.7%. The growing number of inactive bitcoins means that investors are unwilling to sell the asset at current prices and therefore are not transacting with them. Potential bitcoin price growth in the coming weeks is also signalled by renewed interest from whales, which accumulated more than 1,000 BTC last week. Source

UST Becomes Third-Largest Stablecoin

The TerraUSD (UST), an algorithmic stablecoin from the Terra ecosystem, has hit another key milestone. With a market capitalization of more than $17 billion, the UST stablecoin has become the third-largest stablecoin in the entire crypto sector.

The UST stablecoin overtook Binance USD (BUSD) to grab the third place, with the current gap in market capitalization of approximately $250 million.

Tether (USDT) remains the leading stablecoin, whose market capitalization recently surpassed $80 billion. USD Coin (USDC) is second at $49 billion.

In contrast to the other stablecoins, UST is designed quite differently. While USDC or USDT stablecoins are built on the premise that issuers hold assets worth the total market capitalization of those stablecoins, TerraUSD is designed to keep its peg to the greenback via a mint-and-burn mechanism and market arbitrageurs. You can read about how stablecoin UST works on our blog. Source

Ethereum Foundation Holds 0.3 % of All ETH

The Ethereum Foundation’s latest financial report for 2021 showed that the foundation’s treasury holds $1.3 billion Ethereum. Based on Ethereum’s current market capitalization of $368.8 billion, the Ethereum Foundation owns approximately 0.3% of all ETH in circulation.

“We believe that more decentralized funding is important for the future of the Ethereum ecosystem,” stated Aya Miyaguchi, Executive Director at Ethereum Foundation. “We continuously try to allocate resources to third parties that we believe can make better decisions than us within certain domains.”

Last year, the foundation spent a total of $48 million. Layer-one research and development accounted for $21.8 million, including the Ethereum mainnet upgrade and external grants for network stress testing.  Source

Beanstalk Becomes a Victim of Flash Loan Attack

An Ethereum-based stablecoin protocol called Beanstalk Farms was exploited during the weekend. Hackers stole almost $180 million from the decentralized finance protocol, causing the value of the protocol’s native currency BEAN to drop by 80%.

The team behind Beanstalk said that the funds were siphoned off via flash loan, which allows you to borrow any available amount of assets without putting up any collateral, as long as the liquidity is returned to the protocol within one block transaction.

Blockchain security company PeckShield further reported that the attacker deposited most of the stolen assets to TornadoCash. According to an analysis by CertiK, the attacker used a flash loan obtained through the decentralized protocol Aave to borrow close to $1 billion in cryptocurrency assets and exchanged these for enough BEANs to gain a 67 percent voting stake in the project. With this supermajority stake, they were able to approve the execution of code that transferred the assets to their own wallet. Based on the duration of an Aave flash loan, the entire process took place in less than 13 seconds.

Interestingly, it appears that the perpetrator donated 250,000 USDC to the Ukraine Crypto Donation wallet. Source

Curiosity: Jack Dorsey’s First Tweet Sale

Crypto entrepreneur Sina Estavi bought Twitter founder Jack Dorsey’s first-ever tweet as an NFT for $2.9 million last year. He listed the NFT for sale again at $48 million last week. 

However, the NFT auction did not go as he had hoped. He received only seven bids for his NFT, ranging from $6 to $277, a miles away from his expectations.

“The deadline I set was over, but if I get a good offer, I might accept it, I might never sell it,” Estavi told the Coindesk on Wednesday. Source

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Daniel Mitrovsky


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