01/02/2024 0 Comments

1. Is buying Bitcoin right now a good strategy?

According to SignalQaunt, an author profile on CryptoQuant, Bitcoin miners have started sending large volumes of coins to exchanges. Sending a high amount of BTC into exchanges has hardly a good impact on the price.

For instance, there was a similar situation in May 2023.  During that time, the Bitcoin price fell from $29,000 to $26,000.

BTC miners shed holdings

Bitcoin’s price over the last few days has been moving sideways. But with a possible plunge coming, the coin might shed a significant part of its value.

This potential was in contrast to the expectations of a price increase in the first part of January 2024. AMBCrypto then considered the Miner Net Position Change. This metric considers the 30-day supply change held by miners. At the time of writing, the Miner Net Position Change was in the negative area. Specifically, the number had decreased to -7174.44.

This decrease was confirmation that Bitcoin miners were selling off their holdings instead of accumulating as they did for most of October.

Should the Miner Net Position Change continue to be in the red, then market players should expect the same for BTC. However, participants also need to know the outcome of the ETF filings, which are due soon and could affect BTC.

For some, an approval could send the Bitcoin price higher.

An opportunity presents itself regardless

There are, however, others who believe that the outcome would be a “sell the news” event. An assessment of the technical outlook showed that the Money Flow Index (MFI) was 35.60.

In the early hours of the 30th of December, the MFI was 18.50. This reading suggests that Bitcoin was oversold. Hence, the higher trend displayed by the indicator at press time was evidence that sellers were exhausted. At the same time, the signal could also serve as a confirmation that the BTC price might jump back to $43,000.

But rising beyond the price could be challenging. This was because the 12 and 26 EMAs had fallen into the negative region. If the EMA fails to follow the MACD’s rise to the green, then BTC’s momentum might trend downwards.

When the Hash Ribbon changes from a clear region to red, it indicates a danger zone. In this region, Bitcoin has the potential to capitulate. However, the metric was in the white region at press time. Though BTC tends to correct at its press time value, long-term holders might find it profitable to buy Bitcoin before the market becomes overheated.

2. Study Observes Consolidation of Bitcoin Mining Rewards With Antpool

In a significant shift within the bitcoin mining landscape, Antpool’s resurgence in 2023 has marked a notable trend in the consolidation of bitcoin rewards, surpassing Foundry USA in blocks mined. The Miner Mag’s recent analysis reveals that Antpool, along with other major pools, has centralized coinbase block rewards, reflecting a deeper, more interconnected mining ecosystem. This consolidation hints at unknown and strategic financial arrangements and evolving power dynamics among leading mining pools.

Report Highlights Rising Consolidation in Bitcoin Mining Pool Rewards

According to The Miner Mag, ten of the fifteen largest mining pools have been merging their coinbase block rewards since early 2022. This trend includes prominent names like Binance Pool, BTC.com, and Braiins Pool, among others.

These pools, initially launched as independent operators, are now regularly sending their block rewards to shared output addresses, indicating a shift towards cooperative, strategic operations.

The Miner Mag’s latest report shows that Antpool has been at the forefront of this consolidation movement. In March 2022, it was the sole pool directing rewards to specific output addresses.

Over time, other major pools began following suit, routing their rewards to coincide with Antpool’s, resulting in a substantial aggregation of mining rewards. This trend underscores Antpool’s influential role in shaping the industry’s consolidation direction.

The pooling of resources to single output addresses suggests the presence of financial agreements aimed at stabilizing daily payouts. This is particularly relevant as all involved pools utilize a Full Pay-per-Share (FPPS) model, necessitating consistent payouts to miner customers.

With such a model, pools are more susceptible to fluctuations in mining luck, thus emphasizing the need for robust financial support systems, as noted by The Miner Mag’s research.

The consolidation raises questions about the autonomy and interdependence of bitcoin mining operations. The Miner Mag hints at a potentially dominant financing entity, possibly linked to Antpool or other Bitmain-related entities, managing these consolidated addresses.

This entity’s control over the coinbase and hopping addresses implies a significant influence over the distribution and management of mining rewards.

While the specifics of the theorized financing counterparty remain unclear, The Miner Mag suggests Antpool’s early transaction patterns indicate its potential role. As mining pools consolidate their rewards and possibly their hashrate to Antpool, the dynamics within the mining community shift.

As of December, Antpool leads the charge by mining 26.6% of the blocks, with Binance Pool and other parties within the group accounting for a significant portion of the remaining shares. Antpool managed to be the top earner in November but this month, Foundry USA is leading by 28.78% of the total hashrate.

3. Blackrock Names JPMorgan as Authorized Participant for Spot Bitcoin ETF Despite Jamie Dimon Wanting to Ban Crypto

Blackrock, the world’s largest asset manager, has named JPMorgan as a lead authorized participant for its spot bitcoin exchange-traded fund (ETF). This followed JPMorgan CEO Jamie Dimon stating in a congressional hearing that bitcoin and cryptocurrency are used primarily for criminal purposes and that he would close down crypto if he were the government.

JPMorgan Named Authorized Participant by Blackrock for Spot Bitcoin ETF

On the final day of the U.S. Securities and Exchange Commission (SEC)’s deadline, Blackrock, the world’s largest asset manager, submitted an updated filing for its spot bitcoin exchange-traded fund (ETF). The SEC gave spot bitcoin ETF applicants until Friday to submit their amended filings in order to be included in the first batch of decisions in early January. Moreover, the securities regulator reportedly said it wants authorized participants (APs) named in amended filings.

Blackrock’s latest amended filing shows that it has named JPMorgan and Jane Street as the authorized participants for its spot bitcoin ETF. However, JPMorgan CEO Jamie Dimon recently said at a Senate hearing in reply to a question by Senator Elizabeth Warren (D-MA) that he would shut down cryptocurrency if he were the government, emphasizing that bitcoin and crypto are mainly used for criminal purposes.

Commenting on JPMorgan’s agreement with Blackrock despite Dimon’s negative stance on crypto, Vaneck’s director of digital assets strategy, Gabor Gurbacs, stated on social media platform X Friday:

3 weeks after JP Morgan CEO says bitcoin is for criminals, drug traffickers, and money launderers in front of Congress, his firm is named authorized participant for the Blackrock bitcoin ETF … perhaps it’s time to retract that statement?

Many people on social media shared the sentiment. Zerohedge wrote on X: Jamie Dimon, who ‘hates’ bitcoin, will be broker-dealer on the bitcoin ETF of the world’s biggest asset manager.” In another post, the user wrote: “Dear Senator Elizabeth Warren, Jamie Dimon is ‘on it’: he will be lead AP on the Blackrock and Invesco bitcoin ETFs, accelerating global adoption of crypto, and lifting the value of the product that ‘he’s always been opposed to’ into the trillions.”

According to their updated filing with the SEC, Invesco/Galaxy also named JPMorgan as an authorized participant for their proposed spot bitcoin ETF.

Besides Blackrock, several other spot bitcoin ETF applicants — including Vaneck, Valkyrie, Bitwise, Invesco/Galaxy, Fidelity, Wisdomtree, and the Ark Investments and 21shares joint endeavor — also submitted their amended filings with the SEC on Friday, aiming to be considered in the initial wave of spot bitcoin ETF decisions.

While many are bullish that spot bitcoin ETF approvals would boost the price of BTC, JPMorgan’s analysts are skeptical. They said in a November note that spot bitcoin ETFs could put “severe downward pressure on bitcoin’s price.” Meanwhile, Blackrock disclosed in a filing last week a plan to seed its spot bitcoin ETF with $10 million on Jan. 3.

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Harvey CHEN

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