The premiere digital coin is exhibiting the volatility that it is well known for
Bitcoin has seen some wild moves in the last 24 hours as the price of the premier digital coin has swung $1000 in this period. The biggest crypto by market cap first saw a bullish breakout late Monday — taking out the all-important barrier of $10K. The resulting short squeeze saw the price rise to around $10,400 with the crypto derivatives exchange BitMEX seeing the biggest short squeeze in 8 Months. In total, more than $430 million worth of bitcoin shorts were closed on BitMEX, Huobi Global, Binance, OKEx, and FTX.
This wasn’t the end of the story though. In the last few hours, BTC has given up almost all the gains as it hit against the major resistance of $10,500. The price plummeted by 14% from $10,180 to $8,600 on BitMEX within less than 15 minutes. BTC has tested this level three times in the past 8 months alone. Apart from hitting a major resistance, a long squeeze occurred as most of the traders were aggressively long anticipating a further increase in BTC price.
The move precipitated a liquidation of about $120 million worth of long contracts — the move coincided with the U.S market opening today causing some to speculate that CME Bitcoin futures market was partially behind the sell-off in BTC.
However, considering that BTC has rebounded from the immediate support in the $8,600 region, the move still remains constructive and bitcoin might very well take another stab at the strong resistance just above $10k. On the flip side, if the support caves in, it would signal a pause in the current bullish trend and pose for a deeper correction.
Moving on, let’s review some of the other interesting additions to the Cryptoverse in the past few weeks.
BTCDOM Perpetual Swap
While we are on the topic of trading cryptos, a new product was recently launched by crypto exchange Bitfinex, which allows investors to take a position on bitcoin’s overall share of the cryptocurrency market. The first of its kind perpetual swap dubbed as BTCDOM allows you to bet on BTC’s dominance in the crypto market compared to the market value of other cryptocurrencies.
The first of its kind, BTCDOM perpetual swap will be a futures contract without expiry date — that relies on a proprietary Bitcoin Dominance Index, which comprises of seven of bitcoin’s most liquid trading pairs—Ethereum, EOS, Litecoin & XRP. It represents a less volatile form of trading exposure for investors than the regular futures contracts since it represents the value of BTC against a broader range of digital assets. The BTCDOM contract is settled in USDT (Tether).
1:1 Bitcoin Deposit Insurance
In another first of its kind in the industry, Canadian crypto exchange BitBuy is collaborating with a local security firm Knox to offer full insurance on all Bitcoin (BTC) deposits, as reported by Cointelegraph. According to the press release, the value of exchange’s Bitcoin cold storage holdings is insured as a result of its partnership with the Canadian Bitcoin custody provider. Although the crypto exchange lists six other cryptocurrencies as well, the insurance option is only available for BTC deposits for now, with plans for expansion to other digital assets in the future.
First Synthetic Coin ETHBTC
The UMA project — a decentralized financial contracts platform recently allowed the creation of its token ETHBTC. The synthetic coin simply measures the value of ETH against BTC. Interestingly though, no Ethereum or Bitcoin is needed to make it. ETHBTC comes as an important addition to the rapidly growing Decentralized finance model. UMA claims to create other ‘priceless coins’ like this one if this experimental model succeeds.
Creating ETHBTC involves users posting DAI as collateral to the smart contract. Based on the collateralization rate of 120%, the contract will allow the user to generate a specific amount of ETHBTC, which can then be sold on the open market. Alternatively, they can use the synthetic coin to add liquidity to the ETHBTC pool existing on Uniswap.
Open-Source Protocol Hybrix
A Dutch startup has introduced an innovative blockchain platform, which it claims would challenge the current model of centralized exchanges. The underlying open-source protocol Hybrix would allow a digital value to be freely transported between all distributed ledgers. It comes with a digital token that is not confined to any single blockchain.
The company states that it currently supports 32 blockchains and 387 tokens. They claim that the universality of the token provides access to the benefits of the blockchains, sitting on top of all distributed ledger systems. One major advantage of Hybrix over Atomic swaps is that unlike the latter, compatibility does not need to be built into a network in advance. Also, developers can launch their own cross-ledger tokens as they please.
Originally Published on Medium
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