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A big raise of $105M by US miner to recycle waste coal into crypto

The US miner company Stronghold announced a total raise of 105 million dollars to support techniques to recycle coal waste during bitcoin mining. 

The huge raise became possible as the Bitcoin community is becoming more and more environmentally conscious. 

The announcement of Tesla regarding resuming the bitcoin payments has compelled the Coal-powered mining industry to consider environmental aspects of the processes.

Stronghold, a digital mining firm based in Pennsylvania, has recently shared a statement to the news media that the company’s very first power generation infrastructure, “The Scrubgrass Power

Generation Plant” uses coal waste to produce energy in order to mine cryptocurrencies such as bitcoin. The

The company also mentioned that the scale of power generation by the Scrubgrass power plant situated at Venango County is equivalent to a big-scale hydropower generation plant.

The waste coal that the Stronghold company recycles is assumed to be the result of coal mining operations in the 19th and 20th centuries. The power generation methodologies of the company enable it to restore vast regions of land that were previously wrecked due to the coal acid drainage (AMD) caused by the accumulation of coal waste.

AMD can be described as a cycle in which snow or rain gets mixed with the sulfur elements of the coal waste. This poisonous mixture then runs into water passages, thereby affecting marine life. Stronghold company has shown a desire to donate rehabilitated lands back to regional communities.

Statements from the Co-chairman of Stronghold 

In his recent interaction with the news media, Bill Spence, co-chairman of stronghold company, has said that the poisonous gases from burnings of coal waste have always been a devastating issue for Pennsylvania, his home-state, since the past hundreds of years.

He continued by saying that they only utilize advanced crypto mining procedures with an aim to remediate the unpleasant effects of coal mining operations of the 19th and 20th-century in many of the environmentally overlooked areas of the United States.

Furthermore, the Stronghold has given out an estimated report regarding cryptocurrency mining done by the company; the report states that they eliminate around 200 tonnes of coal waste for every cryptocurrency it mines. 

Conclusion 

Till present, Stronghold has reportedly restored Pennsylvania land of around 1000 acres that were previously enlisted under the category of unusable lands by working in a coalition with some active regional environmental authorities. Not only has the company successfully removed more than 98% of NOx, mercury, and SO2 emissions, but also the company’s production procedure generates fly ash that can be employed as a fertilizer.

By 2022, Stronghold strives to get 28,000 plus cryptocurrency miners operational and is planning to have facilities with the potential to generate more than 200 megawatts of electricity.

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

A big raise of $105M by US miner to recycle waste coal into crypto

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Bitcoin derivatives data shows pro traders ignored today’s $41K pump

Sometimes all Bitcoin (BTC) needs to pump 10% is a positive remark from someone like Elon Musk.

The Tesla CEO has been pointed to as the culprit for the recent downturn after the company’s May 12 announcement explaining that it would no longer accept Bitcoin payments due to environmental concerns. Musk followed up by saying that he was looking into other cryptocurrencies that required 99% less energy consumption. 

However, on June 13, the situation reversed as Musk reassured the public that Tesla did not sell any additional Bitcoin. The post also said that the electric-car producer would resume taking BTC payments as soon as its Bitcoin mining relied on a minimum of 50% clean energy.

In bear markets, top traders act with caution

While retail investors and algorithmic trading bots jump into action as soon as bullish or bearish signals and news flash, top traders tend to act more with more caution. Those who have been around the crypto markets long enough know that positive news might end up being ignored or severely downplayed in bear markets.

On the other hand, even potentially negative news seems to have little to no impact during bull runs. For example, on Sept. 26, 2020, Kucoin was hacked for $150 million. The following week, on Oct. 1, the United States Commodity Futures Trading Commission charged BitMEX for operating an unregistered trading platform and violating Anti-Money Laundering regulations.

Two weeks later, police reportedly questioned the founder of OKEx, forcing the exchange to suspend crypto withdrawals. Had this series of negative news happened while Bitcoin was flat or in a bearish phase, the price would have undoubtedly have stalled during a bear market.

Bitcoin price at Coinbase in USD, Sept. 2020. Source: TradingView

As shown above, Bitcoin barely had any negative impact in late September and October 2020. In fact, by the end of November 2020, Bitcoin was up 74% in two months. This is the main reason why top traders tend to ignore positive news during bear markets and vice-versa.

The 3-month futures premium is neutral

A futures contract seller will usually demand a price premium to regular spot exchanges. This situation is not exclusive to crypto markets and happens in every derivatives market because in addition to the exchange liquidity risk, the seller is postponing settlement and this results in a higher price.

The 3-month futures premium (basis rate) usually trades at a 5% to 15% annualized premium in healthy markets. When futures are trading below the regular spot exchange price, it signals a short-term bearish sentiment.

Huobi 3-month Bitcoin futures basis. Source: Skew

As shown above, the future basis has been below 11% since May 20 and flirting with bearish territory on multiple occasions as it tested 5%. The current level indicates a neutral position from top traders.

The options skew is no longer signaling fear

The 25% delta skew compares similar call (buy) and put (sell) options side-by-side. It will turn positive when the protective put options premium is higher than similar risk call options.

The opposite holds when market makers are bullish and this causes the 25% delta skew indicator to enter the negative range.

Deribit Bitcoin options 25% delta skew. Source: laevitas.ch

The above chart confirms that top traders, including arbitrage desks and market markers, are currently uncomfortable with Bitcoin price as the neutral-to-bearish put options premium is higher. However, the current 7% positive skew is far from the 20% exaggerated fear seen in late May.

Derivatives markets show no evidence of top traders getting excited about the recent $40,000 hike. On the bright side, there is room for leverage buyers to mount positions. Stronger upswings usually occur when investors are least expecting, and the current scenario seems to be a perfect example.

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

Bitcoin derivatives data shows pro traders ignored today’s $41K pump

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Elon Musk announced, Tesla is reconsidering Bitcoin as Payment after Miners Turn 50 % Green.

The globally known business tycoon, Elon Musk, CEO of famous automobile company Tesla, announced on Sunday, 13 June 2021, that Tesla will resume taking payments through bitcoin once the miner’s industry will confirm the usage of adequate clean energy from now onwards.

Musk tweeted on Sunday that if miners provide a formal assurance of using at least 50% of clean energy in order to maintain a positive impact on our environment, Tesla will indeed start bitcoin transactions. 

The electric-car producer company stopped putting up with installments from customers who intended to pay their car expenses with bitcoin. Tesla took this sudden step in mid-may 2021 as the company had some serious concerns regarding how cryptocurrency mining is affecting climate change. This concern was raised as cryptocurrency mining makes use of vast pools of powerful computers.

In may Musk said, his company is deeply concerned about this rapid increase in the use of fossil fuels in order to carry out Bitcoin transactions and mining, particularly coal, which is well known to produce the worst emissions among whole categories of fuel.

Musk reacts to the tweet of the CEO of South African asset manager

The CEO of South African asset manager sygnia, Magda Wierzycka, tweeted that Elon Musk is trying to manipulate the market by tweeting about bitcoin prices. He added that Musk’s behaviour should trigger a thorough investigation on the matter by the United States Securities and Exchange Commission.

On Sunday, Tesla CEO denied allegations imposed on him by Magda Wierzycka regarding market manipulation. He explained that his company has hardly sold 10 per cent of its bitcoin ownership to substantiate that bitcoin could be liquidated effortlessly without any need to move the market, he said in his tweet. 

Furthermore, by disclosing its earnings statements, Tesla announced it has sold some 272 million dollars worth of crypto assets during the initial quarter, and this move helped the company to reduce regulating losses by 101 million dollars, as mentioned in the company’s earnings statement.

In February 2021, Musk’s company, in an SEC filing, revealed that it purchased 1.5 billion dollars worth of bitcoin and also confirmed that Tesla would soon begin to accept bitcoin as an installment method for its products.

Conclusion 

Often, the Tesla owner Elon Musk’s statements on social media regarding cryptocurrency makes significant rise and fall in crypto prices, but on Sunday, it appeared to show an instant effect as bitcoin prices overall elevated nearly 8 per cent just around the daytime on Sunday.

Elon Musk announced, Tesla is reconsidering Bitcoin as Payment after Miners Turn 50 % Green.

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2 Bitcoin price indicators suggest BTC has not bottomed yet

Traders are using various strategies to determine whether Bitcoin price has bottomed, but on-chain activity and derivatives data hint that the situation remains precarious.

Has Bitcoin price bottomed yet? According to @noshitcoins, derivatives and on-chain data signal that further downside could be in store.

Traders have been trying to time the much-anticipated trend reversal ever since Bitcoin (BTC) initiated its 48% correction to $30,000 on May 12. The move culminated with $12 billion worth of futures long positions being liquidated, and to date, trader’s confidence remains somewhat dampened.

The community started looking everywhere for trend reversal signs, including technical patterns, United States CPI inflation data and Bitcoin exchange deposits. For example, some analysts stated that a higher high, followed by a move above $40,000, would be enough.

However, two days later, Bitcoin managed to break the $40,000, although the move didn’t last for more than six hours. Meanwhile, other traders inferred that a retest of the $30,000 bottom is needed before a bounce.

Although there could be empirical evidence or even logic backing those statements, market prices don’t always react to external news or previous chart formations. Unlike stocks, Bitcoin investors can’t rely on commonly used valuation multiples or even comparables.

Sure, a digital store of value is one use case, but at the same time, it is uncensorable and easily transferable. Furthermore, some users value Bitcoin’s peer-to-peer fiat convertibility outside of KYC-regulated exchanges. Another factor to consider is the investors who are increasing their Bitcoin portfolio due to the lack of correlation with traditional financial assets.

This panacea of diverse and sometimes conflicting narratives creates barriers for modeling the market’s potential, adoption status, and even measuring the effectiveness of recent developments.

Some will cheer for Tesla and large companies building up Bitcoin reserves, while others couldn’t care less about who’s holding BTC and instead focus on the challenges of scalability and fungibility.

Skew: the professional “fear and greed” indicator

Call options allow the buyer to acquire Bitcoin at a fixed price when the contract expires. Put options, on the other hand, provide insurance for buyers and protect against price drops.

Whenever market makers and professional traders lean bullish, they will demand a higher premium on call (buy) options. This trend will cause a negative 25% delta skew indicator. On the other hand, if downside protection is more costly, the skew indicator will become positive.

Bitcoin 30-day options 25% delta skew. Source: laevitas.ch

A 25% delta skew oscillating between a negative 10%, and a positive 10% is usually deemed neutral. This balanced situation held until May 16, as Bitcoin lost the critical $47,000 support, which had held for 76 days.

As the markets deteriorated, so did the 25% delta skew indicator, and the cost of protective options spiked. Therefore, until the metric establishes a more neutral pattern nearer to the 5% level, it seems premature to call the market bottom.

Active Bitcoin supply signals that weak hands need to cool off

Traders also monitor the number of BTC that have been active lately. This indicator can’t be deemed bullish or bearish by itself as it does not provide information on how old the involved addresses are.

Active supply that transacted at least once in the trailing 30 days. Source: CoinMetrics

The 500% price rally from Oct. 1, 2020, and the $64,900 peak on April 14, 2021, caused a major increase in the supply moved in the months before the rally. When this metric presents a sharp decrease, it indicates that investors are no longer interested in participating at the current price level.

There are currently 2.2 million BTC active over the past 30 days, and this is significantly higher than levels seen before Oct. 2020.

As things currently stand, traders should not be so that Bitcoin has bottomed, at least until the market no longer has relevant activity surrounding the sub-$40,000 level.

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.

2 Bitcoin price indicators suggest BTC has not bottomed yet

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Amid rising stablecoin inflow, cautious traders fear a dead cat bounce

The recent extreme volatility in the cryptocurrency market following Bitcoin’s (BTC) dip to $30,000 and the recovery to $38,000 has traders confused about whether the current price action is a ‘dead cat bounce’ which will see token prices head lower or a solid reversal that will set the floor for the next leg higher for the market. 

While BTC price still remains more than 40% below its all-time high of $64,863, bulls have managed to weather multiple attempts to significantly break below support at $36,000. 

BTC/USDT 4-hour chart. Source: TradingView

A closer analysis of on-chain data and exchange inflows shows that Bitcoin’s sell-off led to the market-wide downturn and Delphi Digital analyst Nick Pappageorge highlighted the fact that BTC inflow to exchanges “topped over 20,000 BTC in just one hour on Wednesday,” which was the highest level sesince March 2020.

BTC exchange inflows. Source: Delphi Digital

FUD-o-rama destabilizes the market

One of the major sources of market turbulence identified by Pappageorge was the seemingly daily FUD headlines, including yet another Chinese government ban of cryptocurrencies and concerns that Tesla would dump its Bitcoin holdings. These back-to-back fear-laced narratives led retail traders to offload their coins on exchanges to escape a further price slide.

Pappageorge also pointed to concerns raised by a pair of hacks on the Binance Smart Chain which saw the price of PancakeSwap (CAKE) and Pancake Bunny (BUNNY) plunge, with the latter being drained of $45 million worth of user funds as compounding market fears.

The turnaround in sentiment this week has been in part fueled by positive headlines such as the formation of a Bitcoin mining council following a meeting between Elon Musk, Michael Saylor and North American Bitcoin miners, which has helped spark a turnaround in BTC and altcoins. The quick reversal so triggered the debate on whether the current market activity resembles a dead-cat-bounce or a trend reversal. 

Experienced traders accumulate at lower prices

While many of the newer entrants to the cryptocurrency market have found the recent volatility nauseating, the more experienced investors jumped at the chance to accumulate BTC at a 50% discount as the number of new accumulation addresses reached new all-time highs amid the shakeout.

Number of Bitcoin accumulation addresses. Source: Glassnode

Well-known Twitter personality and Bitcoin analyst PlanB posted the following chart showing how Bitcoin oscillates around the stock-to-flow (S2F) model, showing the recent downturn is well within the standard range it deviates.

BTC price oscillations around S2F model. Source: PlanB

PlanB said:

“Buying opportunities like today are rare (Q1 2019 when I wrote the S2F article, March 2020 due to covid, and now). Life is all about choices.”

As for bullish signs needed to support a quick recovery, the May 24 Delphi Daily report from Ashwath Balakrishnan highlighted the “sharply rising” circulating supply of fiat-backed stablecoins, which has increased from “15 billion to nearly 21 billion in the last 5 days.”

Stablecoin circulating supply. Source: Delphi Digital

While this could be a sign that dip buyers are “loading up ammo,” Balakrishnan was sure to note that “it could also just be stablecoin arbitrageurs” and stressed the importance of “ensuring that the circulating supply doesn’t drop sharply to confirm these inflows will be deployed.”

A record amount of dry powder is now available on exchanges but at the same time, an entirely new cohort of cryptocurrency investors who just experienced their first 50% pullback are now wondering if they should pull out the market or double-down on their investment. The more experienced in the crowd are betting that the market is headed higher but further volatility is all but guaranteed.

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

Amid rising stablecoin inflow, cautious traders fear a dead cat bounce

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