Bitcoin Pinned below $20,000
Amid a worsening economic backdrop and U.S. dollar strength, Bitcoin (BTC-USD) began the month on a sour note. The leading cryptocurrency continued to slide over the last week, dropping below $18,700 on September 7 to reach its lowest point since June 2022 before rebounding.
A key reason behind Bitcoin’s ongoing downtrend remains investor risk aversion. Rising inflationary pressure and fear of a potential global recession are pushing investors to cash, primarily into the U.S. Dollar, while pushing the U.S. Treasuries’ 5-year yield to 3.38% – its highest level in roughly 15 years.
However, despite the value sliding by 3.50% over the last seven sessions, BTC investors continue to accumulate. Per the latest report by Glassnode, the number of BTC wallets holding ten or more BTC jumped from 150,363 to 150,515 in the few hours since BTC hit its 80-day low on September 7. Similar accumulation levels were also reflected in the BTC wallets holding 0.01 to 1 BTC
Altcoins Outperform as Bitcoin Bear Market Persists
Ethereum (ETH-USD) developers have confirmed that the “Merge” will be implemented between September 13th and 15th. The news caught investors’ attention, driving the value of ETH 4.75% higher over the last seven sessions, with the leading altcoin by capitalization currently trading just above the $1,600 level.
Among the top-ten cryptos by capitalization, Cardano (ADA), which will soon implement the Vasil update, gained approximately 5.75%. Solana also managed to stage a minor comeback, notching a 3.70% gain over the last seven sessions. Meanwhile, Ethereum Classic (ETC) jumped nearly 13.90% this week as the idea of ETH miners migrating to mine ETC continues to gain traction.
Ethereum’s second-largest mining pool, F2Pool, invited its existing ETH miners to pool their resources to mine ETC, RVN, and some other proof-of-work (PoW) cryptos after the Ethereum’s Merge, adding to Ethereum Classic’s momentum.
Not to be left out, EOS (EOS) rallied this week, climbing roughly 11.70%. Despite the broader market conditions, the 24-hour trading volume for EOS jumped nearly 140%. This rapid appreciation comes following the EOS Foundation’s rebranding and upgrades proposal. Called Antelope, this initiative aims to bring new improvements to all networks using the EOSIO framework.
Terra Classic Rises from the Ashes
In what may come as a surprise to many, Terra Classic (LUNC) – the new token launched after the Terra (LUNA) and UST stablecoin debacle – jumped by 76.30% in the last seven days. Between August 25 and September 1, more than $1.2 billion worth of investments flew into LUNC, taking its market capitalization from $665 to $1.87 billion, with its market capitalization now approaching $3.4 billion.
A key driver behind Terra Classic’s sudden surge is attributed to the 1.20% tax burn proposal. Learning from past mistakes, the Terra Classic team has decided to implement a 1.20% tax on all on-chain LUNC transactions, including smart contract and wallet interactions.
Per the development team, this tax will help reduce LUNC’s oversupply and make it a deflationary currency. Leading crypto exchanges like KuCoin and Gate.io have expressed their support for this proposal, further influencing investor sentiment.
Avalanche’s Flash Loan Exploit, New Ethereum ETP, and More
Avalanche-based DeFi lending protocol, Nereus Finance, is the latest victim of a hack wherein the attacker exploited its smart contract to wipe out around $371,000 worth of USDC stablecoins. A preliminary report from blockchain cybersecurity organization CertiK indicates that the exploit was detected on September 6 on Nereus’ liquidity pools connected to the Trader Joe DEX and Curve Finance AMM.
With the Ethereum Merge inching closer, Switzerland-based digital bank SEBA Bank has launched a new service for its institutional customers. The bank has initiated an Ethereum staking service for institutions that want to invest their ETH tokens into the new Ethereum PoS chain to earn staking rewards. This follows similar moves from crypto banking platform Anchorage Digital, which launched its own ETH staking service for institutional customers.
Finally, ETC Group introduced a new Exchange-Traded Product (ETP) based on the proposed EthereumPoW chain. After the Merge, Ethereum will transition to PoS, but several mining companies and industry leaders are lobbying for a hard fork to introduce a new EthereumPoW chain with a new ETHW token. This ETHW token will be the basis for ETC Group’s latest physically-backed ETP, titled the ETC Group Physical EthereumPoW, or ETHWetc.