Market update
Cointree Crypto Market Update - November 6th 2024
Market report for traders
🔮 BTC and altcoins
Over the last 7 days, Bitcoin ends at AU$109,775 moving -0.63% at the time of writing. Meanwhile, Ethereum ends at AU$3,861 moving -3.93% week-on-week. On the Altcoin side, Solana drops -1.72%, Cardano -4.50%, and XRP -0.72%.
🗞 What’s happening in the news?
🚀 Bitcoin Mining Difficulty Surges Past 100 Trillion for the First Time
Bitcoin’s mining difficulty—a measure of how hard it is to mine a new block—has soared by 6.2%, breaking through the 100 trillion mark for the first time. This adjustment occurred at block height 868,896, reaching a record 101.7 trillion.
What Does This Mean?
- Mining Difficulty: A relative measure indicating how tough it is to find a new Bitcoin block. It adjusts every 2016 blocks (roughly two weeks) to ensure blocks are mined every 10 minutes on average.
- Hash Rate: Last week, the Bitcoin network's seven-day moving average hash rate reached an all-time high of 755.5 EH/s, surpassing the 750 EH/s level for the first time.
Ethan Vera, COO of Luxor Technology, noted:
"Miners operating at high electricity costs over 6 cents per kWh and using less efficient machines are being pushed into negative profitability territories."
Despite a dip in miner revenues following the fourth Bitcoin halving on April 20, miners are ramping up their operations. Many are deploying new equipment and upgrading rigs, especially as the market becomes dominated by U.S. public miners.
👮♀️ Victoria Police Seize AU$142,679 in Crypto Under New Legal Powers
Victoria Police have successfully leveraged new legislation to seize nearly AU$150,000 worth of cryptocurrencies from criminals over the past year. This marks a significant advancement in law enforcement's ability to tackle crypto-related crimes.
How Did They Do It?
- New Legislation: Changes to the Confiscation Act 1997 in August 2023 now allow police to search data storage devices for recovery phrases.
- Seed Phrases Accessed: During a raid on a large-scale drug trafficking ring in Melbourne, police found recovery phrases enabling them to access six different crypto wallets.
- Legal Authority: The updated act permits officers to interfere with computers or data storage devices to gain exclusive control over digital assets.
The Victoria Police report stated:
"This was the first successful cryptocurrency seizure since the changes to the legislation."
Broader Implications:
- Operations: The Australian Federal Police are also stepping up efforts to combat crypto crime, recently restraining AU$9.3 million worth of digital assets linked to illegal activities.
- Regulatory Shifts: Australia is preparing to implement new guidelines requiring local crypto exchanges to acquire financial services licences.
🐍 Solana Challenges Ethereum for Institutional Interest
Solana, often known for its memecoin activity, is gaining significant attention from financial institutions looking to build on its network. Despite being newer than Ethereum, Solana offers advantages in transaction throughput and lower fees.
What's Driving Institutional Interest?
- Performance: Solana doesn't face the same scalability issues as Ethereum, making it attractive for high-volume transactions.
- Recent Developments: Financial giants like Franklin Templeton, Citibank, and Société Générale announced Solana-based projects during the network's Breakpoint conference in September.
- Expert Insight: Hadley Stern, Chief Commercial Officer at Marinade Finance and former Fidelity Digital Assets executive, stated:
"Asset managers, high-net-worth individuals, and hedge funds are interested in staking on Solana."
Comparing Solana and Ethereum
- Ethereum: Has the advantage of being the oldest smart contract platform with the largest developer community. However, it faces challenges with transaction fees and scalability.
- Solana: Offers cheap transactions and high throughput without relying on complex scalability solutions like Ethereum's layer-2 networks.
Leah Wald, CEO of Sol Strategies, remarked:
"If you're an institution thinking 10 years out, you can't build on a blockchain you're concerned about. Solana offers a real opportunity for more sophisticated on-chain funds and financial platforms."
📖 What we’ve been reading
Polymarket payouts to be delayed unless Fox, NBC agree on US election winner
No matter who wins the 2024 US presidential election, Polymarket users may have to wait months for their settlements.
Reddit Reverses Crypto Strategy, Sells Off BTC and ETH Held for Treasury
Social media giant Reddit has relinquished the majority of its crypto holdings, in a sale worth nearly US $7b.
Solana saw its highest monthly active addresses, surpassing 120 million in October
Solana had over 123 million active addresses on the network last month, reaching its highest level.
Disclaimer: The information provided is for educational purposes and does not constitute financial product advice. You should obtain independent advice from an Australian financial services licensee before making any financial decisions.
