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BTC December futures reach $73,500 — Is everyone flipping ultra bullish?

April 11, 2021 by Blockchain Consultants

Bitcoin (BTC) has been struggling to break the $60,000 resistance for almost a month. But despite the impasse, BTC futures markets have never been so bullish. While regular spot exchanges are trading near $59,600, the BTC contracts maturing in June are trading above $65,000.

Futures contracts tend to trade at a premium, mainly on neutral-to-bullish markets, and this happens on every asset, including commodities, equities, indexes, and currencies. However, a 50% annualized premium (basis) for contracts expiring in three months is highly uncommon.

BTC futures curve, in USD. Source: bitcoinfuturesinfo.com

Unlike the perpetual contract — or inverse swap, these fixed-calendar futures do not have a funding rate. Thus, their price will vastly differ from regular spot exchanges. Fixed-calendar futures eliminates eventual funding rates’ spikes from the buyers’ perspective, which can reach up to 43% per month.

On the other hand, the seller benefits from a predictable premium, usually locking longer-term arbitrage strategies. By simultaneously buying the spot (regular) BTC and selling the futures contracts, one gains a zero-risk exposure with a predetermined gain. Thus, the futures contracts seller demands higher profits (premium) whenever markets lean bullish.

The three-month futures usually trade with a 10% to 20% versus regular spot exchanges to justify locking the funds instead of immediately cashing out.

OKEx BTC 3-month futures annualized premium (basis). Source: Skew.com

The above chart shows that even during the 250% rally between March and June 2019, the futures’ basis held below 25%. It was only recently in February 2021 that such phenomena reemerged. Bitcoin surged by 135% in 60 days before the 3-month futures premium surpassed the 25% annualized level on Feb. 8, 2021.

While professional traders tend to prefer the fixed-month calendar futures, retail dominates perpetual contracts, avoiding the expiries’ hassle. Moreover, retail traders consider it expensive to pay 10% or larger nominal premiums, even though perpetual contracts (inverse swaps) are more costly when considering the funding rate.

BTC coin-based perpetual futures funding rate. Source: Bybt.com

While the recent 0.20% funding rate per 8-hour is extraordinary, it is definitely not unusual for BTC markets. Such a fee is equivalent to 19.7% per month but seldom lasts more than a couple of days.

A high funding rate causes arbitrage desks to intervene, buying fixed-calendar contracts and selling the perpetual futures. Thus, excessive retail long leverage usually drives the futures’ basis up, not the other way around.

As crypto-derivatives markets remain largely unregulated, inefficiencies shall continue to prevail. Thus, while a 50% basis premium seems out of the norm, one must remember that retail traders have no other means to leverage their positions. In turn, this causes temporary distortions, although not necessarily worrisome from a trading perspective.

While exorbitant funding rate fees remain, leverage longs will be forced to close their positions due to its growing cost. Thus, December’s $73,500 contract does not necessarily reflect investors’ expectations, and such a premium should recede.

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk. You should conduct your own research when making a decision.

BTC December futures reach $73,500 — Is everyone flipping ultra bullish?

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Filed Under: blockchain technology Tagged With: Bitcoin, Bitcoin Futures, btc, btc price, Currencies, Curve, derivatives, Exchanges, Fees, funding, Futures, Futures Markets, investment, leverage, Market, Markets, opinions, other, Trading

3 Latest Blockchain and Crypto-Related Announcements That You Should Know

April 9, 2021 by Blockchain Consultants

3 Latest Blockchain and Crypto-Related Announcements That You Should Know

This article talks about the 3 latest announcements related to Blockchain and crypto space that every Blockchain enthusiast must know. 

Table of Contents 

  • Overview
  • Latest News and Announcements This Week
  • New Kind of Network(NKN) Price Rallied to a New All-Time High 
  • Indian Tech Giant’ Tech Mahindra’ to Launch Stablecoin Tool for Banks
  • India’s Largest Cryptocurrency Exchange, WazirX Launches NFT Marketplace
  • Concluding Lines 

Overview

The uncertainties in 2020 have resulted in a cryptocurrency boom. Blockchain technology has proven to be distributed, transparent, safe, and reliable. Right from its use-cases in finance to supply chain and healthcare, Blockchain has its use-cases in every domain. 

As this sector is booming and shows no sign of slowing down, Blockchain and crypto always remain in the limelight. Let’s talk about top announcements related to this domain.

Latest News and Announcements This Week

In this section, let’s talk about the latest news and accomplishments in the crypto and blockchain domain.

  • New Kind of Network(NKN) Price Rallied to a New All-Time High 

Backed by Blockchain Technology, a New Kind of Network, also known as NKN, is a new type of peer-to-peer(P2P) network connectivity protocol that uses economic incentives to promote users on the internet to share and distribute their network connections and employ unused bandwidth.   

This network has risen 1,400 percent from a low of $0.052 on March 8 to a new all-time peak of $0.779 within two days on April 6, making it one of the month’s unexpected risers.

According to its official website, since its launch in starting in 2018, the project has steadily expanded its active population to become the “world’s largest blockchain network in terms of full consensus nodes,” with 67,266 nodes already running on the network with the capacity to host millions of full consensus nodes. Following Binance’s announcement on March 11 that NKN holders could gain 20% APY on their assets if they deposited them into their Binance savings account, the NKN price began to rise.

  • Indian Tech Giant’ Tech Mahindra’ to Launch Stablecoin Tool for Banks

Indian tech firm Tech Mahindra is revealing and developing a new stablecoin service targeting financial institutions and banks. The tech giant has collaborated with Dutch blockchain application incubator Quantoz to launch a “stablecoin-as-a-service” tool to lessen transaction fees and processing rates.

As a part of the announcement, Rajesh Dhuddu, Blockchain and cybersecurity leader at Tech Mahindra, expressed his views and stated that the recent OCC statement promoting the use of stablecoins for the settlement of financial transactions by banks would drive demand and accelerate innovation in global payments.”

Tech Mahindra’s collaboration will help users integrate Quantoz’s Nexus transaction processing platform into their legacy infrastructure. 

  • India’s Largest Cryptocurrency Exchange, WazirX Launches NFT Marketplace

Another big announcement related to Blockchain and crypto space came from one of the leading largest crypto exchanges, WazirX. Recently, the Indian-based crypto exchange platform announced that it is launching the NFT marketplace for the exchange of digital art, assets, intellectual property, and more. This announcement comes after a strong month for the exchange’s in-house WRX token.

WazirX founder Nischal Shetty believes that it is the first of its kind in India. He further expressed his views regarding the launch and stated that his entire team is delighted to launch India’s first Non-Fungible Token marketplace. As a part of the launch, he explained that creating and listing NFTs will be free on the platform, and work is apparently underway to repeal the bedrock gas fees that increase when minting NFTs on multiple Blockchains. He further stated that, at present, his team is working around certain basics to make NFTs more profitable for their customers.

Concluding Lines 

Apart from these announcements, the XRP price surges 55%, as it has renewed its aim on the creation of a cross-border payment network. The number of crypto projects has also risen, according to Cointelegraph. It says that a new benchmark has been achieved, with the market capitalization of 100 cryptocurrencies reaching $1 billion.

If the domain of crypto and Blockchain interests you, you can get enrolled in Blockchain Council and become a Certified Blockchain Expert. 

To get instant updates about Blockchain Technology and to learn more about online Blockchain Certifications, check out Blockchain Council.  

3 Latest Blockchain and Crypto-Related Announcements That You Should Know

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Filed Under: blockchain technology, cryptocurrency Tagged With: art, article, Banks, Binance, blockchain, Blockchain and Crypto, blockchain council, blockchain news, blockchains, crypto, crypto exchange, Crypto Exchanges, Cryptocurrencies, cryptocurrency, cryptocurrency exchange, cryptocurrency news, cybersecurity, Digital, digital-art, exchange, Exchanges, Fees, finance, founder, healthcare, India, Infrastructure, Internet, Market, market capitalization, marketplace, news, nft, NFTs, p2p, payments, Space, stablecoin, Stablecoins, supply chain, tech, Technology, token, transaction fees, WazirX, xrp

CoinMarketCap removes South Korea crypto exchanges from Bitcoin price tracker

April 6, 2021 by Blockchain Consultants

Crypto price trackin website CoinMarketCap has removed many South Korean exchanges from its calculations for the price of Bitcoin as the coin dipped under $58,000 again.

As of today, CoinMarketCap’s Bitcoin price tracker shows no data from major South Korean crypto exchanges including Upbit, Bithumb, Coinone, and Korbit. The website uses data from many exchanges to estimate the average price for cryptocurrencies. At the time of publication, the price of Bitcoin (BTC) is $57,721, having fallen more than 2% this morning.

Speaking to Cointelegraph, CoinMarketCap content manager Molly Jane Zuckerman said the removal was due to the premium observed on crypto exchanges based in South Korea. The crypto analytics provider estimates the BTC price to be roughly 6% higher than that on other exchanges.

“If the prices on South Korean exchanges stabilize, then we will add the data back in, but that hasn’t happened yet,” said Zuckerman.

The last time the price tracking website took similar action was in 2018, when CoinMarketCap announced it had “excluded some South Korean exchanges in price calculations due to the extreme divergence in prices from the rest of the world and limited arbitrage opportunity.”

During roughly the same time three years ago, the price of XRP was falling significantly after reaching an all-time high of $2.96 on Jan. 2. However, the token is looking bullish today, having briefly surpassed $1.00 for the first time since 2018 after it rose more than 20% in the last 24 hours. The price has since fallen to $0.9694 at the time of publication.

CoinMarketCap said only its Bitcoin price index was affected today, given the large volume of the crypto asset on South Korean exchanges. Last month, the volume of transactions in the South Korean digital currency market — driven in part by the price of BTC reaching an all-time — briefly exceeded the daily average transaction amount of the country’s stock market.

CoinMarketCap removes South Korea crypto exchanges from Bitcoin price tracker

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Filed Under: blockchain technology Tagged With: Bitcoin, Bitcoin Price, btc, btc price, Business, coinmarketcap, crypto, Crypto Exchanges, Cryptocurrencies, Currency, data, Digital, digital currency, Exchanges, index, korea, Market, other, South Korea, stock market, token, world

Payment Provider ‘Nuvei’ Launched Support for Nearly 40 Crypto Assets

March 30, 2021 by Blockchain Consultants

Payment Provider 'Nuvei' Launched Support for Nearly 40 Crypto Assets

According to the latest announcement, Nuvei, a payment provider, has launched support for almost 40 crypto assets which means e-commerce merchants can now transact in approximately 40 cryptocurrencies through this global platform. 

Now, as a part of adding to its current stack of innovative payment methods, a payment provider has added support for the world’s most popular cryptocurrencies, including Bitcoin and Ether, and lesser-known cryptocurrencies such as Reddcoin and Bitcoin Gold, Dogecoin, etc.

Talking about Nuvei, it is a payment technology partner of thriving brands that aims to deliver unified commerce solutions and expertise. 

It was also mentioned that, among 40 cryptocurrencies, customers can even use Ripple, despite its recent legal woes and succeeding delistings from significant exchanges.

Nuvei to Empower Clients with Frictionless Payment Experiences

As Nuvei is all set to provide support to E-commerce merchants, merchants partnered with the payment provider can utilize several crypto assets to send and receive payments across 200 countries, even in previously hard-to-reach countries.

Nuvei’s launch arrives at a moment when conventional payment services are competing and entering the crypto space. Visa announced a pilot program on March 29 that allows all of its members to use the Ethereum blockchain to resolve fiat transactions. The solution utilizes the USDC stablecoin to settle transactions.

As a part of this launch, Nuvei’s CEO and chairman, Philip Fayer, expressed his views regarding the same. He mentioned that adding several crypto assets will empower all categories of clients with frictionless payment experiences and a more significant opportunity to participate in a global marketplace.

Moreover, the report suggests that crypto-asset transactions will provide enhanced security, privacy, and integrity to the clients in comparison to traditional fiat payment methods.

It was further noted that apart from common crypto-assets, the payment platform supports approximately 150 local currencies and over 455 APMs. In addition, e-commerce merchants will be able to conduct business across national borders and within the fiat ecosystem’s limits.

With the addition of cryptocurrencies, the platform can now facilitate and promote transactions for Non-Fungible Tokens (NFTs). 

To get instant updates about Blockchain Technology and to learn more about online Blockchain Certifications, check out Blockchain Council. 

Payment Provider ‘Nuvei’ Launched Support for Nearly 40 Crypto Assets

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Filed Under: blockchain technology, cryptocurrency Tagged With: Bitcoin, blockchain, Business, ceo, chairman, crypto, Cryptocurrencies, cryptocurrency, Currencies, dogecoin, e-commerce, ether, ethereum, Ethereum Blockchain, Exchanges, fiat, gold, marketplace, NFTs, partner, payments, Privacy, ripple, security, Space, stablecoin, Technology, Tokens, USDC, visa

Tokenized real estate inches forward despite legal, technical hurdles

March 26, 2021 by Blockchain Consultants

An unusually rowdy (and informative) virtual panel at the Security Token Summit yesterday reveals the fractious difficulties of bringing regulated assets on-chain — as well as the promise and progress of the tokenized real estate use case despite those hurdles. 

Michael Flight of the Liberty Fund, Jude Regev of Jointer.io, and Mohsin Masud of AKRU spoke for 30 minutes on the state of securitized real estate in a free-flowing and often-contentious discussion that highlighted the complexities that arise when decentralized finance and stringent governmental oversight meet. Host Kiran Arif of AKRU seldom spoke.

When asked why tokenized real estate is so exciting, Flight pointed to the size of the market and to how few investors can gain exposure to it.

“You’ve got 280 trillion dollars of real estate assets, and tokenized real estate is gonna let all investors into that asset class,” he said.

Mohsin concurred, noting that high prices and regulations have traditionally kept average investors out of the real estate market, aside from purchases like homes.

“We want to offer these securities, these asset-backed securities, to people who traditionally haven’t had access.”

Regulatory shackles 

While the promise of the use case is significant and has been pondered over for close to a decade, aside from a handful of experiments there has been little significant traction. 

Part of the reason, according to Regev, is the friction from bringing a regulated asset to a decentralized system.

“It can’t work,” he said.

He compared current digital real estate to “digital paper,” saying that all of the legal requirements and barriers surrounding real estate remain functionally identical regardless of whether its a digital or physical format, and as a result unaccredited investors still can’t have access.

Likewise, he expressed doubt that such tokens would ever be listed on exchanges or achieve any significant liquidity, rendering the use case useless.

“You remember the days of timesharing, it sounds so good? And when you’re into it, you can’t get out? That’s pretty much what it is,” he said, comparing tokenization to a “magic word” with little substance.

Something is better than nothing

Mohsin rejected many of these points, pointing out that REITs and other real estate-backed products have managed to achieve significant liquidity. Moreover, he noted that there are 12.5 million accredited investor households in the US who could benefit (more recent data suggests there are 13.6 million), even if tokenized real estate doesn’t fully “democratize” the market. 

Flight also pointed out the significant advanced in utility that can be made with tokenized real estate. He said that Liberty is working with centralized crypto lender Blockfi to allow real estate-backed security tokens to be used as collateral, and even to earn interest as a yield-bearing asset.

While he remained suspicious regardless of these points, Regev also made a stirring call for platforms and issuers taking responsibility for users if the use case is ever to gain significant traction.

“We need to protect the simple person who is busy, busy to survive, and wants their money to work for them.” 

Tokenized real estate inches forward despite legal, technical hurdles

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Filed Under: blockchain technology Tagged With: Better, BlockFi, crypto, data, decentralized, Decentralized Finance, Digital, Exchanges, finance, format, Market, money, other, real-estate, security, Tokenization, Tokenized assets, Tokens, us

Governments are looking to buy Bitcoin, NYDIG CEO confirms

March 25, 2021 by Blockchain Consultants

State-owned investment funds are reportedly making inquiries into buying Bitcoin (BTC).

According to Robert Gutmann, CEO of New York Digital Investment Group, the firm has been having conversations with sovereign wealth funds about possible Bitcoin investments.

Gutmann made this known while appearing at a virtual podcast with investment strategist and founder of Real Vision Raoul Pal.

Pal also confirmed Gutmann’s revelation, stating that Singapore’s sovereign wealth fund Temasek was indeed a Bitcoin investor.

According to Pal, Temasek which holds about $306 billion in assets under management, has been buying virgin Bitcoin from miners.

Tweeting on Thursday, Pal characterized the imminent entry of sovereign wealth funds into the Bitcoin space as a “wall of money.”

Temesek

— Raoul Pal (@RaoulGMI) March 25, 2021

Indeed, since publicly-listed firms like MicroStrategy and Tesla began holding BTC on their balance sheets, there has been speculation about whether governments would follow suit.

Drawing parallels between the appeal of Bitcoin for public firms and sovereign wealth funds, Gutmann touched on the desire of institutional investors to hedge their dollar-denominated liabilities.

According to Gutmann, investors are re-evaluating their portfolios, adding:

“If you look at the world today on a forward basis, it is reasonable to be asking yourself as an investment committee or as an allocation committee [if] having all of [their] assets denominated in dollars against dollar-denominated liabilities is the right allocation mix.”

Back in August 2020, upon announcing its first Bitcoin purchase, MicroStrategy CEO Michael Saylor touched on the long-term value of BTC vis-à-vis the depreciating value of cash over time.

Earlier in March, Russ Koesterich, portfolio manager at BlackRock’s Global Allocation Fund characterized gold’s status as an inflation hedge as being exaggerated.

Bitcoin is currently down 8% over the last 24 hours in what is likely an upside price dislocation given the significant decline in the volume of Bitcoin held on exchanges. Despite the current drop, BTC is still up about 78% year-to-date.

Governments are looking to buy Bitcoin, NYDIG CEO confirms

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Filed Under: blockchain technology Tagged With: Bitcoin, btc, buy bitcoin, Cash, ceo, conversations, Digital, Exchanges, founder, Inflation, investment, Investments, money, New York, NYDIG, Space, tesla, Wealth, world

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