BTC is up just 0.6% this week. OKB enhanced by the musk effect. SOL weak after another recent hack. AAVE increases network security.
Bitcoin
Bitcoin managed to post just a 0.6% gain in another quiet week for the crypto markets.
The ongoing pressure on the Binance exchange and its finances has clouded the market’s outlook for the past seven days. Stock markets have also been weak over the past few weeks as markets see continued rate hikes by central banks, which has weighed on crypto assets as well.
The ongoing bear market has hurt the bitcoin mining industry after it took on significant debt loads during the 2021 bull market. The top 10 debtors in cryptocurrency mining are said to owe more than $2.6 billion according to the Hashrate Index, while the total debt of all miners is high at $4 billion.
Due to declining sales and the slump in BTC, miner Core Scientific has filed for Chapter 11 bankruptcy protection. The majority of the convertible debentures, totaling $851 million, belong to Marathon, the second largest issuer. If other companies in the mining space go bankrupt, it could affect the price of crypto tokens through forced sales to pay off liabilities.
Miners in the US also suspended operations over the weekend because of the storms that swept across North America. The Bitcoin mining hash rate, a measure of the blockchain’s processing power, was down by about 100 exahash per second (EH/s), or 40%, according to BTC.com.
On Dec 25 it returned to about 250 EH/s. ETH’s price traded at $1,183, but last week’s bearish action could have a negative impact on the token. Support stands at $1,100 and $1,000 for the coming weeks.
BTC Price Index
The price of Bitcoin on the weekly chart is trading at $16,858 and the resistance at $17,605 is a concern if the market cannot revisit this level.
U.N.
Elon Musk still has an unintended impact on cryptocurrency projects after OKB token price rally.
Musk followed crypto exchange OKX’s Twitter account and saw his native token surge over 10% this week.
OKB is currently the seventh largest crypto exchange by trading volume with 24-hour volume of $487 million. That’s small compared to Binance’s $6.25 billion, but close to the $575 million total for second-place Coinbase. Binance is also under threat for its finances as market participants question the safety of their funds.
It was also noted that similar to FTX’s native exchange token, the BNB token has no listings on other major exchanges. Lucas Outumuro, head of research at IntoTheBlock, told CoinDesk:
Exchanges are unlikely to list BNB as they see it as security given the centralization of their network. It’s probably not worth risking a security’s listing for US exchanges, especially if it’s a competitor’s token.
Binance CEO Changpeng Zhao has tried to reassure employees and users that the exchange is in good shape. That was followed by $1.14 billion in withdrawals from the exchange in just 12 hours as traders feared negative attention. Zhao said the large payouts were “handled with ease” and “things appear to have stabilized.”
OKB price index
The price of the OKB token is $22.99 and the token has held up well compared to other coins in the bear market. There could be further gains if Musk decides to use the exchange for a Twitter wallet or other collaboration.
SOL
Solana was one of the weaker coins in the top 20 this week after another hacking issue.
Solana’s DeFi protocol Raydium recently announced that a hacker had taken over the organization’s “owning authority” and used it to drain Raydium’s liquidity pools. The hacker was able to steal over $2.2 million worth of tokens, including $1.6 million worth of SOL.
For Solana, it’s another embarrassing break in its architecture after previous hacks and security issues that hurt the project’s market cap. Raydium is one of the largest decentralized finance protocols on Solana and is considered one of the stars of the Solana DeFi ecosystem.
Back in August, another hack removed $8 million from Solana hot wallets. This was followed in late July by an attack on a Solana-based stablecoin NIRV, which lost 85% of its value after a flash loan attack on its Nirvana Finance yield log.
SOL price index
Solana is hoping for a better 2023 after losing 93% of SOL token value year-to-date. Solana price is trading at $11.33 but there is a possibility of a drop below $10 as the chart looks weak.
GHOST
Lending platform AAVE has seen a positive week after moving to increase the security of its own network.
The project will use Chainlink’s Proof of Reserves tool to protect tokens on its Ethereum-based network and also bridged assets on Avalanche as exchanges look to improve their security following the FTX collapse.
Max Melcher, Go-to-Market Lead of Proof of Reserve at Chainlink Labs, told CoinDesk that proof of reserve allows decentralized technologies to provide accurate reserve values rather than trusting a single party.
Leveraging Chainlink Proof of Reserve, Aave can verify that bridged assets accepted on the platform are fully collateralized before allowing users to borrow against them.
AAVE price index
AAVE is currently trading around the $55 level and could build on that as the market absorbs this latest safety-enhancing development. The project currently ranks 45th in the list of coins with a market cap of $784 million.
Disclaimer: The information contained herein is provided without regard to your personal circumstances and therefore should not be construed as financial advice, investment recommendation or an offer or solicitation to engage in transactions in cryptocurrencies.
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