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New Year in the bear sentiment - Crypto weekly update

Published: 13. 01. 2022 · Author: Daniel Mitrovsky

This week, the total market capitalization exceeded 1.81 trillion EUR. Decrease at the 7-day interval is 0.54 %. Bitcoin increased by 1.05 % during the week to a current value of over than €38,200. Bitcoin dominance is 39.8 %.

Source: Coinmarketcap

New Year in the bear sentiment

Bitcoin and altcoins have had a really difficult start to the new year.

The world's largest cryptocurrency by market cap Bitcoin dropped at the beginning of the new year by 8 % and briefly touched the symbolically important $40,000 level. Bitcoin has fallen below $40,000 for the first time since August 2021. Since it's all-time high of $69,000 reached in November last year, the flagship cryptocurrency has fallen by an eye-popping 36 %.

The January correction also affected the second largest cryptocurrency, Ethereum. On Monday, Ethereum price fell below $3,000 to levels not seen since September of last year. Just two months ago, on November 10, Ethereum hit an all-time high of $4,878. However, the latest price action shows that the asset has lost 38% of its value since then.

There are several reasons why Bitcoin may have kicked off 2022 on the wrong foot, ranging from unrest in Kazakhstan to decisions made by the Federal Reserve.

Starting in the town of Zhanaozen on January 2, 2022, political unrest engulfed Kazakhstan after the government lifted a price cap on liquefied petroleum gas, causing gas prices to virtually double. The resulting unrest was met with a nationwide Internet shutdown, reportedly causing a significant chunk of the world's Bitcoin miners to go offline. This, in turn, has coincided with Bitcoin's continued price decrease across January.

On the other hand, the United States Federal Reserve (Fed) announced last week that it may accelerate the timetable for increasing interest rates. This basically means that the Fed will stop printing money and will instead make it more expensive to borrow to keep a cap on inflation.

Although the beginning of the year was not exactly the best for cryptocurrencies, a positive signal of these sell-offs is the fact that bitcoin found a huge support level around $40,000, on which all bitcoins were instantly buy backed by other investors. This means that investors still have an enormous interest in bitcoin and continue to plan to add it to their diversifiable portfolios. Source

Billionaire Bill Miller bet on bitcoin

Financial tycoon and globally renowned billionaire Bill Miller is investing heavily in bitcoin at current price levels.

Miller in his latest interview with WealthTrack said that he no longer considers himself just a “Bitcoin observer” but rather a real Bitcoin bull. The billionaire investor now holds 50% of his net worth in Bitcoin and related investments in major industry firms like Michael Saylor’s MicroStrategy and BTC mining firm Stronghold Digital Mining.

Miller bought his first Bitcoin back in 2014 when BTC was trading around $200 and then purchased a “little bit more overtime” when it became $500. The investor did not buy it for years until BTC plummeted to $30,000 after hitting around $66,000 in April 2021, he said. The billionaire investor noted that he looks at Bitcoin as an “insurance policy against a financial catastrophe” as well as a powerful investment tool that has been outstripping gold.

Now celebrating his 40th anniversary in the investment business, Miller currently serves as chief investment officer at Miller Value Partners, a company he founded back in 1999 while working at investment giant Legg Mason. The legendary investor is known for beating S&P 500 for 15 consecutive years with Legg Mason, where he reportedly controlled up to $70 billion. Source

PayPal working on its own stablecoin

Payments giant PayPal 'exploring' its own US dollar-backed stablecoin.

A developer named Steve Moser discovered references to something called "PayPal Coin" within PayPal's iOS app. After this news, PayPal senior vice president of crypto and digital currencies Jose Fernandez da Ponte confirmed Moser's findings.

"We are exploring a stablecoin. And if and when we seek to move forward, we will, of course, work closely with relevant regulators" paypal spokesperson said for CoinDesk in an emailed statement.

PayPal has slowly extended its reach into the crypto market over the last few years. It started to facilitate the purchase of select cryptocurrencies in late 2020, for example, and in March 2021 it added the "Checkout with Crypto" feature to let users buy things with their digital tokens. Source

Disney expands in Metaverse

The multinational entertainment giant was approved for a “virtual-world simulator” patent during the last week of December 2021.

Disney has been approved for a patent that would create personalized interactive attractions for theme park visitors. The technology would facilitate headset-free augmented reality (AR) attractions at Disney theme parks.

The tech would work by tracking visitors using their mobile phones and generating and projecting personalized 3D effects onto nearby physical spaces, walls and objects in the park.

This is not the first time Disney has indicated its interest in the metaverse. During the company’s fourth-quarter earnings call in November 2021, CEO Bob Chapek said the firm is preparing to blend physical and digital assets in the metaverse.

There are 12 official Disney theme parks worldwide in the United States, Paris, Hong Kong, Japan and China. In 2021, Disney generated a total revenue of nearly $17 billion with its parks, experiences and products segment despite global lockdowns due to the COVID-19 pandemic. Source

A second Christmas or a lottery win?

Over time, bitcoin mining has become a matter for large corporations and pooling companies with high mining power. However, the story of a small miner which happened earlier this week confirms that although the probability of the block being mined by “mining from home” is very low, it is still not unrealistic.

On Tuesday morning, a small miner with a total mining power of 126 TH/s successfully added a new block on the Bitcoin blockchain. The lucky miner, who may have been mining on just one or two machines, solved a block with their modest hash rate capacity of 126 terahashes per second (TH/s). According to a Tuesday tweet from Dr. Con Kolivas, it’s equivalent to about 0.000072% of the total Bitcoin network hash rate, which is 175,000,000 TH/s.

Bitcoin mining expert and member of the Bitcoin Mining Council Hass McCook told Cointelegraph that he has never heard of anything like it, adding, “To say this is very rare is an understatement. Usually, having 0.000072% of the hash rate means that, on average, Solo CK will win 0.000072% of the blocks, or about 1 in 1,400,000,” he explained. ”

However, his luck brought him a block reward of BTC 6.25 worth $266,000. Bitcoin software engineer Dr Con Kolivas, who was informed about this curiosity as first, said it was a once-in-a-lifetime chance. Source

Curiosity: Bitcoin as the 3rd most sought-after word in the Czech Republic

Despite the fact that the current situation on the cryptocurrency market is not optimal, cryptocurrencies still had one of the most successful years in the whole history. Bitcoin's long-term trend has not yet changed and institutions and retail investors continue to show enormous interest in this digital asset. This trend is also confirmed by our Czech neighbors, where the word "Bitcoin" has reached a third place in the Google Trends search rankings in 2021.

While Google trends do not determine the direction of the trend, the growth of interest from retail investors cannot be ignored. According to the available data, the biggest interest in searching “Bitcoin” was in Prague. This was followed by the Zlin, South Moravian-Silesian and Hradec Kralove region. Source

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