Category: Cryptocurrency News

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Ethereum (ETH), a forerunner in the decentralized finance (DeFi) ecosystem, has seen a notable surge in its staking activities. This staking boom has raised eyebrows among experts from JPMorgan concerned over ETH’s increase in centralization and the consequences that may arise. Ethereum, aiming to transition to a proof-of-stake consensus mechanism, opened the floodgates for staking. This meant holders could ‘stake’ or lock their tokens to support network operations like block validation. However, while this promises rewards for the stakers, JPMorgan analysts have reported that there could be ripple effects. Related Reading: Whales Abandon Ship? Ethereum’s Value In Jeopardy As Major Holders Liquidate Ethereum Centralization Concerns Rise To The Surface JPMorgan analysts, led by Nikolaos Panigirtzoglou, highlight the inadvertent increase in Ethereum’s network centralization, particularly post the Merge and Shanghai upgrades. The Ethereum network became “more centralized as the overall staking yield declined,” they noted.  According to the analysts, what’s leading to this centralization could be attributed to liquid staking providers. Lido, a notable player, has been pinpointed for its dominant role. The JPMorgan report noted: The top 5 liquid staking providers control more than 50% of staking on the Ethereum network, and Lido specifically accounts for almost one-third. The analysts further disclosed while platforms such as Lido tote their decentralized nature, the underlying reality appears different. The analysts said these platforms “involve a high degree of centralization.” According to the analysts, the ramifications of such centralization can’t be understated. They mentioned that “a concentrated number of liquidity providers or node operators” might compromise the network’s integrity, leading to potential points of failure, attacks, or even conspiracy, resulting in an “oligopoly.” They further highlighted that such centralized entities could censor or exploit user transactions, undermining the community’s interests. The Rehypothecation Risk And Declining Rewards Another dimension to the staking story is the looming threat of ‘rehypothecation.’ In simple terms, it’s the act of leveraging staked assets as collateral across various DeFi platforms. According to the JPMorgan’s analysts: Rehypothecation could then result in a cascade of liquidations if a staked asset drops sharply in value or is hacked or slashed due to a malicious attack or a protocol error. Furthermore, as Ethereum continues its journey on the staking path, the staking rewards seem to diminish. The report indicated a drop in total staking yield from 7.3% before the Shanghai upgrade to roughly 5.5% recently. Related Reading: Ethereum Price At Risk of Sharp Decline Unless ETH Clears This Heavy Resistance Regardless, Ethereum has shown a slight upward trajectory of 1.5% in the past 24 hours, with a market price currently sitting at $1,643 and a market cap of approximately $9 billion, at the time of writing. Featured image from Unsplash, Chart from TradingView

September was the biggest exploit month in DeFi, with over $300 million in losses, taking the crown from August.

Based on several factors, the latest Bitcoin news points to a potential bullish continuation in the long term. However, the short term remains uncertain; the cryptocurrency continues to trade in a tight range, although BTC has shown a spike in volatility. Related Reading: Bitcoin Price Is Showing Early Signs of Fresh Drop, $27,200 Is The Key As of this writing, the Bitcoin price trades at $25,500 with a 2% loss in the last 24 hours. In the previous seven days, the cryptocurrency maintained some of its profits as most of the tokens in the top 10 by market cap traded in the red after experiencing a slight uptick. Bitcoin News: BTC At Risk Of Topping For Remaining Of The Year The bigger picture for Bitcoin leans to the upside with the approval of a BTC spot Exchange Traded Fund (ETF) in the US gaining momentum. However, analyst Rekt Capital believes current prices are similar to those in late 2019 and early 2020. As the chart below shows, at that time, the price of Bitcoin was trending to the upside in a tight triangle with a top at around $10,000. The cryptocurrency eventually broke about this resistance and entered uncharted territory. As the chart shows, this scenario has some obstacles for optimistic investors. Before the breakout, the price of Bitcoin revisited the lows and event wicked below critical support at $3,250. The analyst believes that BTC could display similar price action as it approaches the top of its current channel. In this scenario, which aligns with BTC’s pre-halving behavior, the cryptocurrency could re-visit the low of the trend. As a result, a return to $20,000 and even the $15,000 lows seems likely. The analyst stated: Here’s the thing about current prices. Right now, there’s a risk of them representing the Top for 2023. But after the Halving, these same exact prices will represent a Re-Accumulation range (red) before lift-off into a Parabolic Uptrend (green). Still Hope For BTC Price Bulls As mentioned, this scenario could hint at short-term losses for BTC, but the analyst shared other Bitcoin news in a more positive tone. First, Rekt Capital believes that the next 6 months into the Bitcoin halving could provide the “last ever retrace” to the $20,000 lows. Related Reading: Bitcoin And Crypto Under The Lens As Bond Market Recalls 2008 Crash As the market approaches this event, the price of Bitcoin is more likely to trend upwards, with a “stronger” beat back to previous highs and potentially into uncharted territory. The analyst concluded: Next ~6 months may offer the last ever retrace to low $20,000s (orange) And 2 months Pre-Halving, we’ll likely see some stronger upside volatility (light blue) Lots of volatility to both the downside & upside await between now and the Halving. Cover image from Unsplash, chart from Tradingview

Solana price staged a double-digit recovery since September and a portion of the move was caused by improving fundamentals.

The Web3 platform’s website has been restored, but the company still warns against using it. The hack may be linked to September’s attack on Balancer.

FTX’s former chief technology officer reportedly claimed in court that then CEO Sam Bankman-Fried authorized Alameda Research’s account to trade more funds than it had available.

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The civil trial of the US Securities and Exchange Commission’s (SEC) case against Ripple and its top executives, Brad Garlinghouse and Chris Larsen, is set to commence on April 23, 2024. However, the Founder of Dizer Capital, Yasin Mobarak, believes that the SEC will withdraw its charges against Garlinghouse and Larsen before then. Why The SEC Will Drop Charges Against Ripple Founders In a tweet shared on his X (formerly Twitter) platform, Mobarak stated that the reason for his prediction is that it is not in the SEC’s interest to have “a trial where their corruption can be exposed.” He further stated that the Commission’s “agenda” is bigger than these two executives. Prediction: The SEC will withdraw charges against @bgarlinghouse and @chrislarsensf . It is not in their interest to have a trial where their corruption can be exposed, not to mention their agenda is far bigger than just these two executives. The longer $XRP solidifies the… — Yassin Mobarak 🪝 (@Dizer_YM) October 4, 2023 Garlinghouse and Larsen were joined as co-defendants when the SEC filed a lawsuit against Ripple in December 2020. The Commission alleged that the executives structured and promoted the XRP sales to finance the company’s business. Additionally, it accused both individuals of effecting “personal unregistered sales of XRP totaling approximately $600 million.” Mobarak shares similar sentiments with pro-XRP legal expert Fred Rispoli, who stated that the SEC is unlikely to pursue a trial against them and outlined reasons for his assertion. One of the reasons he gave was that the SEC would not want a situation where its credibility is questioned, which he believes could happen if someone like the former SEC Director Bill Hinman was called to testify.  The SEC filing a motion for an interlocutory appeal was considered by many as a means to prolong the trial unnecessarily, which Judge Analisa Torres had reasoned in her order. Following the denial of this appeal, Mobarak believes that the SEC will now move to end this case quickly so it can appeal to the Court of Appeals and “continue to sustain this cloud of uncertainty on the whole industry.” XRP price drops below $0.52 | Source: XRPUSD on Tradingview.com SEC Needs An Incentive To Do So In response to Mobarak’s tweet, another X user mentioned that it would be surprising if the SEC decided to drop the charges against Ripple’s executives “without some incentive from Ripple given to them.” Such an incentive would likely relate to the crypto firm agreeing to a form of settlement.  This is something that Rispoli had suggested when he said that the SEC didn’t intend to maintain a suit against Garlinghouse and Larsen but simply wanted to pressure the company into a “weak settlement.”  However, it is unlikely that Ripple is willing to reach any form of settlement with the Commission as Ripple’s President Monica Lang asserted that her company intends to see the case “all the way through.”  Moreso, there is no reason why Ripple should be willing to settle, considering that they already scored two major victories against the SEC and seem to have the upper hand now.  Ripple and its executives will also have it at the back of their mind that the crypto community is looking to this case for clarity, as any judgment will likely set a precedent for how the crypto industry should be regulated. Featured image from Bit Stalking, chart from Tradingview.com