BTC miners intensify operations as network complexity peaks, and more

10/25/2023 0 Comments

1. Bitcoin miners intensify operations as network complexity peaks

Bitcoin miners are ramping up their operations, undeterred by the cryptocurrency’s stable price, as the network’s hash rate reached a record 455 EH/s on Wednesday last week, doubling from the start of this year. This information indicates an increase in computational power dedicated to mining Bitcoin, suggesting that miners are continuously upgrading their hardware and expanding facilities.

The complexity of block mining on the Bitcoin blockchain also hit a peak at a block height of 812,448 on Monday this week. The Bitcoin difficulty adjustment, which occurs every two weeks to maintain a 10-minute block time, reflects the increased complexity. Prominent players in this space include mining pools such as Foundry USA, Antpool, Viabtc, F2pool, and Binance Pool (NASDAQ:POOL).

Miners earn a block reward of 6.25 BTC along with transaction fees for successful mining. This process is known as Bitcoin Halving and takes place every four years. The next halving event is expected in six months’ time. As the block reward halves, dependence on transaction fees increases. This could intensify competition among key mining pools and potentially raise transaction costs for users.

The surge in Bitcoin’s hash rate and mining difficulty suggests that miners are adapting to changes in the network’s economic model and are ready to compete in a more challenging environment. Despite the stable price of Bitcoin, these developments suggest that the cryptocurrency’s underlying technology continues to evolve and attract significant investment from miners.

2. All eyes on DTCC’s site for spot Bitcoin ETFs

The crypto space has been keeping a close watch on the Depository Trust and Clearing Corporation’s (DTCC) website for any move on a spot Bitcoin (BTC) exchange-traded fund (ETF).

Eagle-eyed watchers noticed the ticker for BlackRock’s ETF — IBTC — vanished from the site before it returned a few hours later. Bitcoin‘s price dropped nearly 3% with the disappearance, indicating much of the trading activity is focused on ETF developments.

The hype around IBTC also seemingly caused DTCC’s site to crash. Senior Bloomberg ETF analyst Eric Balchunas noted the DTCC doesn’t typically get this level of attention, which “speaks to the uniqueness and intensity of this entire saga.”

Early on Oct. 25 rumors spread across social media that ARK Invest and 21 Shares’ joint spot Bitcoin ETF had been listed on the DTCC’s site — in reality, many mistook ARK’s futures ETF tickers for the pair’s spot fund.

Social media posts referred to the ticker “ARKA,” the yet-to-be-approved ARK 21Shares Active Bitcoin Futures ETF along with the tickers “ARKY” and “ARKZ” which respectively refer to the ARK 21Shares Active Ethereum Futures ETF and the ARK 21Shares Active Bitcoin Ethereum Strategy ETF.

The most recent amended filing for ARK’s spot Bitcoin ETF from Oct. 11 shows that the fund will trade using the ticker “ARKB.”

3. Binance and CZ want to dismiss CFTC lawsuit

Crypto exchange Binance and its CEO Changpeng “CZ” Zhao have filed statements to dismiss a lawsuit filed by the United States Commodity Futures Trading Commission (CFTC).

The filing, dated Oct. 23, attempted to show that the CFTC’s lawsuit overstepped its boundaries, specifically as they relate to derivatives products. By accepting the CFTC’s arguments, the court “would allow it to regulate any activity in cryptocurrency […] related to a derivatives product” around the world.

“Congress did not make the CFTC the world’s derivatives police, and the Court should reject the agency’s effort to expand its territorial reach beyond what is permitted by the law,” the filing said.

The CFTC filed its lawsuit in March, alleging that Binance failed to register with the regulator, which violated derivatives trading rules.

4. Bitcoin price reaches $35K as ETF excitement grows

Bitcoin broke through the $35,000 mark for the first time since May 2022, marking a staggering gain in the past 24 hours.

The price of Bitcoin suddenly spiked upward on Oct. 23, with BTC gaining more than 10% from $31,000 to over $34,000.

Less than two hours after breaking $34,000, Bitcoin reached as high as $35,300 according to data from TradingView. Bitcoin is currently changing hands for a price of $34,550.

The sudden uptick in price for Bitcoin comes amid a fresh wave of interest in upcoming spot ETF approvals and a significant increase in overall trading volumes across spot markets.

The iShares spot Bitcoin exchange-traded fund (ETF) proposed by investment firm BlackRock has been listed on the Depository Trust & Clearing Corporation (DTCC), suggesting potential approval by the United States Securities and Exchange Commission.

In an Oct. 23 X (formerly Twitter) thread, Bloomberg ETF analyst Eric Balchunas said the DTCC listing was “all part of the process” of bringing a crypto ETF to market. The iShares spot Bitcoin ETF has a ticker symbol of IBTC for a possible listing on the Nasdaq stock exchange, which applied to list and trade shares of the investment vehicle in June.