Wednesday, January 16, 2019

Exchanges up, prices down 🧐

January 16, 2019

Exchange Transactions Boomed in 2018 Despite Market-Wide Dump

Transaction volume boom

2018 was one of the worst years on record for Bitcoin ever. For exchanges, though, the year wasn't so bad.

According to research publication Diar, exchange transaction volume actually saw quite the boom in 2018 compared to 2017 when the market was soaring.

This number, however, mostly decreased each month as the market sank lower - leaving exchanges with lower revenues from commissions.

Trade count holds steady

At the same time that volume was decreasing, actual number of trades was holding steady throughout the downturn.

Binance was a market leader in this metric and actually saw its trade count go from 17.1 million in January to 33.9 million in December - an increase of +98.2%. Other major exchanges followed the trend, but not closely.

Looking to 2019

For Diar, 2019 will likely drop below 2017 exchange activity even though exchanges are adding more assets for investors than ever before.

But those new assets probably won't help much. With crypto winter in full swing, the negative sentiment is causing a shift towards large market cap coins like Bitcoin.

Right now, Bitcoin accounts for 52.2% of the market which is much higher than a year ago when it only claimed 33.93% of the market.

And with prices across the board down +70% from their all-time highs, it's hard to expect a swift turnaround in exchange activity so soon.

HACK

Cryptopia Goes Offline, Appears to Have Been Hacked

Never heard of Cryptopia?

Cryptopia is a cryptocurrency exchange based in New Zealand and founded in May of 2014.

The exchange is most well known for facilitating the trading of countless low cap coins, many with little to no volume.

Uh oh, what happened

Cryptopia took to its Twitter on Tuesday to announced that it "suffered a security breach which resulted in significant losses."

The exchange said in the tweet that it shut down the exchange to prevent any more losses from occurring and that it contacted New Zealand authorities.

No information was given by Cryptopia about the scale of the attack. But, one Twitter user tracked ~19k ETH ($2.44 mill) and 48 million centrality tokens ($1.18 mill) which were transferred from the exchange.

It is not certain whether these were the lost funds or if the exchange moved these tokens to protect them.

BUSINESS

Bakkt Makes First Acquisition, Purchases Assets of Futures Commission Merchant

Gearing up for launch

Fresh off its recent $180 million capital raise, Bakkt made its first acquisition on Monday.

The Bitcoin Futures exchange purchased "certain assets" from to Rosenthal Collins Group (RCG) a futures commission merchant.

The assets are intended to help Bakkt with its risk management and treasury operations and also help to improve Bakkt's anti-money laundering and know-your-customer compliance.

A statement put out by the company read:

"This acquisition underlines the fact we're not standing still as we await regulatory approval by the CFTC for the launch of regulated trading in our crypto markets. Our mission requires significant investment in technology to establish an innovative platform, as well as financial market expertise to deliver the most trusted fintech ecosystem for digital assets."

Now Bakkt just needs approval

Bakkt is only waiting on CFTC approval before it is able to launch its platform. It recently delayed the launch a second time.

Intercontinental Exchange, the company behind Bakkt (and also the New York Stock Exchange, previously targeted January 24th for the launch of its new cryptocurrency futures exchange. However, the company has not yet received the necessary approvals from the Commodity Futures Trading Commission (CFTC).

The holiday season along with the government shutdown have slowed down the process, but the good news is this should only be a short delay. CoinDesk previously reported that a January 30th launch date is plausible.

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TRADING

Bitcoin Futures are Trading at a Discount

A quick look at CME Bitcoin futures this morning shows that Bitcoin's current spot price is trading higher than its futures price, signaling a continued bearish outlook for the cryptocurrency.

If the opposite were true and futures were trading at a premium, investors would have a bull market attitude as they expect the value to increase.

However, in all three cases - one month, two month, and six month - Bitcoin is expected to take a tumble.

Continue the streak?

The bears are no stranger to January. Actually, for the last four years the cryptocurrency has lost value throughout the month.

Rumors have preciously circulated that Chinese investors were selling in preparation the new year celebration, but it's really unclear if this theory holds any weight or not.

Regardless, with futures on the downtrend and January's odds stacked against Bitcoin, the bull market may be put on hold.

BITS

But wait, there's more...

🚨 Ethereum's upcoming hard fork is under fire after a vulnerability was found in the upgrade that could delay the project.
👎 A new Windows torrent file full of malware is swapping out crypto addresses to steal crypto.
🎶 Bitfury has entered the music industry with the launch of its new project that will bring transparency through blockchain technology.

MEME