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Venture Funding for Blockchain and Crypto Companies Reaches $900 Million in Q3 2020

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Venture funding into blockchain and crypto companies totaled $897.7 million in Q3 2020. The funds went into 212 startups in the industry.

According to the research data analyzed and published by Comprar Acciones, August was the peak month during the quarter, with a total of $367.48 million in funding.

Moreover, based on a report by Outlier Ventures, crypto funding reached $280 million in August. It thus accounted for more than two-thirds of the total funding. Of the total number of deals in August, DeFi & Fintech was the leading vertical, accounting for 62%.

$9 Billion Flows into Ethereum Thanks to DeFi, Highest Inflow Ever

As a result of the yield farming movement and decentralized finance (DeFi) hype, CoinGecko revealed that $9.15 billion flowed into Ethereum during Q3 2020. This was the largest capital inflow into the blockchain since its inception.

Tether, one of the most popular stablecoins, grew its market cap by $5.9 billion during the quarter, a 61% rise quarter-over-quarter (QoQ). US Digital Coin (USDC) market cap grew by $1.5 billion, a 157% QoQ. For Wrapped Bitcoin (WBTC), the growth was an impressive 1,766% following a $946 million increase.

For the top 10 decentralized exchanges (DEX), there was a 700% increase in trading volume, from $3.8 billion in July to $30.4 billion in September. While DEX trading volume grew by an average of 197% month-on-month in the quarter, CEX volume grew by 35%.

Uniswap and Curve were the dominant crypto exchanges accounting for 80% of trading volume during Q3 2020. Overall trading volumes for CEX and DEX platforms shot up by $155 billion or 88%.

On the other hand, DeFi tokens outperformed the crypto market from Q1 to Q3 2020. Among the top performers was LEND, which grew by 3,177% year-to-date (YTD) around the end of September. YFI, on the other hand, grew by 2,908% while UMA soared by 2,819%. Comparatively, Bitcoin and Ethereum posted 50% YTD gains in the same duration, while Ripple grew by 25%.

CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and Investing.com, with over a decade experience in the global financial markets.

Cryptocurrency

Cryptocurrency: Facebook Owned Libra to Launch Stablecoin in January 2021

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Facebook Inc led Libra Association is planning to launch Libra stablecoin pegged to only the United States Dollar as early as January 2021, according to three anonymous people quoted by the Financial Times.

The stablecoin was initially proposed to be pegged to a basket of multiple currencies before the group faced several setbacks after the US parliament pressure Facebook on data breach and other issues that allegedly allowed Russia to meddle in the 2016 US presidential election.

The social media giant has now cut down on its ambition to focus on US dollar-pegged stablecoin in an effort to reduce regulatory bottleneck.

PayPal Inc., one of the first members of Libra Association that pulled out after regulators increased scrutiny on Facebook operations, has since started a cryptocurrency exchange business.

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Cryptocurrency

Bitcoin Drops Over $3000 to $16,806 Per Coin as Whales Prepare to Take Profit

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Bitcoin price depreciated by over $3000 in the last three days to $16,806 per coin following the transfer of almost $1 billion worth of Bitcoins from wallets to exchanges by bitcoin whales.

Also, almost $2 billion worth of derivative positions have been liquidated in the last 24 hours while $1.6 billion worth of positions have been closed in the last 12 hours, according to data from Bybit.

Bitcoin Whales are individuals or groups that own 1000 BTC or more in a single wallet. 

The world’s most dominant cryptocurrency Bitcoin rose from $10,000 to $19,400 per coin in the last seven weeks due to global uncertainty and the negative impact of COVID-19 on traditional assets.

However, it was the report that the United States Treasury Department plans to track owners of self-hosted cryptocurrency wallets that halted the bullish run and forced a pullback as whales that preferred to remain anonymous have started moving their coins to protect earnings against potential taxes.

Alex Kruger, Coinbase CEO, said “This [regulatory concerns], against a backdrop of euphoria and unsustainable high leverage among longs led to the largest 24-hour drop since March.”

Quoting Brian Armstrong, who first tweeted about Treasury Department’s plan to track Bitcoin Whales, Kruger said bitcoin and the entire cryptocurrency space could turn extremely bearish if that tweet turned out to be true. However, he said it is highly unlikely in the short-term.

He said “if what Armstrong talked about comes to be, it would be extremely bearish. As of now, I see that as highly unlikely (in the short-term).”

Kruger added that OKEX’s recent announcement that it has resumed withdrawals might have amplified the bearish trend that led to over a $3000 plunge in bitcoin value.

Most of the frozen bitcoin [on OKEx] had traded up around 70%, so there were a lot of unrealized profits locked up there,” Sui Chung, CEO of CF Benchmarks, said in a statement. “Once these coins were free to move, it’s likely many traders sold them for dollars and stablecoins to realize those gains, adding greater momentum to the selling.”

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Bitcoin Hits Record $19,259 a Coin on Tuesday as Demand Jumps Through the Roof

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Demand for the world’s most dominant cryptocurrency, Bitcoin, rose to a record high on Tuesday amid Trump’s renewed attack on China and general global uncertainty.

Bitcoin rose by 5.2 percent to $19,259.64 or N9.471 million per coin as of 2.24 pm Nigerian time on Tuesday.

Ripple rose by 25.05 percent to 0.00003271 BTC or N233.25 per coin, representing over 100 percent increase in the last one week.

Similarly, Bitcoin Cash advanced to fourth place among the most capitalised cryptocurrencies after gaining 16.90 percent in the last 24 hours to 0.00154 BTC or N129,101 per coin with N2.36 trillion market capitalisation and N170.29 billion volume of trade in the last 24 hours.

Demand for cryptocurrencies rose late on Monday after President Trump renewed his trade war with China, in a move that suggested he is out for revenge.

Few reports have said China was supporting the President-elect, Joe Biden, prior to the US presidential election, and as such was using cyberspace to push that agenda like Russia did in 2016.

The surged in global tension despite COVID-19’s three different vaccines led to an increase in demand for cryptocurrencies by institutional investors in the last 24 hours.

Also, demand for crypto assets on both PayPal and CashApp platforms has exceeded the entire supply of newly minted bitcoins, suggesting a serious supply pressure and likely surge in price above the current level in the near-term.

Bitcoin could set a new all-time record high in few days if demand remains high.

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