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Major U-Turn in Crypto Markets Sends Bitcoin Back Below $87K

Sunday's Trump bump in crypto has mostly vanished nearly as quickly as it appeared. In mid-afternoon U.S. action, bitcoin (BTC) is changing hands at $86,700, barely above its level prior to President Trump taking to social media Sunday to tout his plans for coming U.S. crypto reserve. Ether is now actually beneath its pre-Trump level and at 0.025, the ETH/BTC ratio has touched a new five-year low. Other tokens touted by Trump as part of the coming crypto reserve — Solana's (SOL), Ripple's (XRP) and Cardano's (ADA) — have given up sizable amounts of their Sunday gains, though remain somewhat higher than prior to the president's posting. “Crypto vols are still relatively elevated with both majors still reflecting a Put Skew till end-March,” crypto trading firm QCP Capital wrote to their investors. “The VIX is also elevated, signaling broader market unease in risk assets overall, particularly after the recent tariff escalations from the U.S. administration.” The broader stock market is also in the red, with the Nasdaq shedding 1.1% and S&P 500 0.8% ahead of Trump's promised tariffs on Mexico, Canada and China. Chipmaking giant Nvidia (NVDA) is down 6.5% on news that Singapore has charged three men in a U.S. export controls breach case. Crypto stocks have given up large chunks are early gains on Monday, with a number of them — Core Scientific (CORZ) and Bitdeer (BTDR) among them — now sporting sizable losses on the session. “Concerns over U.S. growth, and impending tariffs on China, Mexico, and Canada — set to take effect tomorrow — will be in focus, driving equities and rates,” said Jake Ostrovskis, OTC Trader at crypto market maker Wintermute. Source: CoinDesk Futures Market Updates After a massive liquidation, the BTC OI has fallen below $48B and ETH OI below $20B. Bitcoin Futures Updates Total BTC Open Interest: $46.91B (-14.06%) BTC Volume (24H): $164.82B (+16.42%) BTC Liquidations (24H): $331.91M (Long)/$63.88M (Short) Long/Short Ratio: 48.87%/51.13% Funding Rate: 0.0040% Ether Futures Updates Total ETH Open Interest: $18.94B (-8.70%) ETH Volume (24H): $67.82B (-6.86%) ETH Liquidations (24H): $170.64M (Long)/$34.85M (Short) Long/Short Ratio: 48.74%/51.26% Funding Rate: 0.0018% Top 3 OI Surges OMNI1: $593.00K (+80.54%) COOK: $911.23K (+68.13%) REQ: $850.78K (+67.87%)

Bitget Annual Briefing 2022-23: The Rational Path Ahead (Part 3)

A guide on how to embrace the year of 2023 Exchanges Are Finding New Ways To Cultivate Trust The FTX blowup single-handedly seemed to have shaken up the entire centralised exchanges (CEXs) sector. But it is not really the truth. Data shows that despite the fear, uncertainty, and doubt (FUD) surrounding CEXs and their transparency, trading volume on 13 major exchanges do not reflect a distinct deterioration of trust (see the columns for “Dec 22”, “Jan 23” and “Feb 23”). Please note that data for February 2023 (“Feb 23”) was recorded on February 10, 2023, hence the volume demonstrated does not represent the full month's data. Given that there was no Black Swan event or any sudden shock to the market in February 2023, we can assume that the month's volume triples the figure calculated in the chart and equivalent to those observed in June, July and August 2022, which were after the Terra dismay and before the FTX collapse. Futures volume equals a small proportion of spot volume, meaning that market speculation indeed intensified (via a surge in spot trading) after Terra failed, and only weakened in the month of the Christmas and holiday season. Binance has been dominating the CEXs sector in terms of both spot and futures markets. Over the same period, Binance spot volume witnessed a gradual growth while its futures market didn't expand at all. What is worth noting is the rise of some other exchanges post-FTX, including ByBit and Bitget for spot and Bitget and Kucoin for futures. A breakdown of average daily volume shows that only Binance and Bitget were able to experience active spot trading activities in the first 40 days of 2023, while others had to deal with the shrinking of their spot markets - an indicator of lower revenues. For futures trading, the three standing men are ByBit, Bitget and Binance. Below is a summary of exchanges and their tokens' performance. The exception is Coinbase as they went public on NASDAQ. Offshore exchanges launch their own tokens, naturally after they have established themselves successfully. In the beginning, holders of exchange tokens used them mostly for fee reduction and for Initial Exchange Offerings (IEOs), but the range of services involving exchange tokens has been extended, through which these tokens' value appreciates. Since Coinbase stock (NASDAQ: COIN) hit its all-time high in November 2021, COIN price has plummeted, resulting in an 85.90% value loss at the end of 2022. The performance of Crypto.com exchange token (CRO), which is the native token of Crypto.com's own blockchain, was the worst out of nine exchange tokens. Except for Bitget Token (BGB), which rose proportionately to the exchange's flourishing, it's understandable that these tokens' prices fell - FTX and its token FTT surely made people shy away from holding exchange tokens. As of February 10, 2023, the market recovery appeared to have resurrected most exchange tokens excluding Huobi Token (HT). Huobi was reported to have laid off a big portion of their payrolls as well as cutting back on employees' incentives, thus the price dropping. The top three exchange tokens/exchange share by performance so far include Coinbase's COIN, Bitget's BGB and OKX's OKB. The rolling 7-day average daily return of exchange tokens can help identify the main price trend for these tokens by smoothing out daily fluctuations that come from the inherent volatility of crypto markets. Higher highs and lower lows can be seen with COIN of Coinbase, HT of Huobi and BMEX of Bitmex. A less volatile token with a tendency to follow upward trends is Bitget's BGB, which is also the single token ended February 10, 2023 on a positive note. FTX, the troubled exchange that saw liquidity crunch after Binance unloaded their token (FTT) holdings, caused investors' trust issues regarding the reserve of centralised exchanges. Exchanges have quickly produced their proof-of-reserve (PoR) to become more transparent and restore users' trust. The latest data from Nansen shows that exchanges host a big percentage of their reserves in stablecoin (Tether is more favoured than USD Coin), Bitcoin, Ethereum. Bitget keeps one-third of their reserves in Bitget Token, whereas ca. 30% of Binance, Crypto.com, Gate.io, Huobi and KuCoin’s reserves are held in small caps or more vulnerable assets, for example, Shiba Inu (SHIB). Institutions Are Staying Put Crypto funding has faced some setbacks since May 2022 because the Terra case triggered the bankruptcy of Three Arrows Capital (3AC), one of the major crypto funds. However, institutions persisted in looking forward, especially when the Ethereum Merge was completed without any trouble. The number of deals began to pick up pace around the end of 2022. Again, the data was recorded on February 10, 2023, therefore February figures may not reflect the right institutional sentiment. Big players are most likely to participate in Seed and Pre-Series A rounds. The most popular category of funding deals is blockchain services at 35.6%, higher than DeFi and GameFi combined. The $650 million Ronin bridge hack of Axie Infinity resulted in a declining interest in GameFi projects in the second half of 2022. Surprisingly, CeFi companies on average received more capital than NFT Metaverse projects, although the gap is not too wide. Another way for traditional finance (TradFi) to merge with crypto is through trading crypto ETFs. As Bloomberg pointed out, crypto ETFs performed really well in the first days of 2023, securing the first 14 spots by year-to-date return on January 13, 2023. Take the NASDAQ Composite Index (the bold pink line) as the benchmark and we can see that the new year sent crypto ETFs soaring. The one ETF seeing losses is ProShares Short Bitcoin Strategy ETF for justifiable reasons: Bitcoin prices went up. Considering the fact that the NASDAQ index often outperformed other indexes such as the SP 500 or the Dow, crypto ETFs should convince more risk-takers in TradFi to explore this emerging industry. Simply create an account, and start exploring the incredible Bitget-Verse today! Disclaimer While we do our utmost best to make sure that the information contained herein is acquired from reliable sources, we provide information on an "as-is" basis with no representations as to the validity, accuracy, usefulness, timeliness, or completeness of any information. We are not responsible for any errors or omissions, losses, and/or damages arising from its display or use. The information, views, and opinions expressed herein are those of Bitget at the time of publication and are subject to change anytime due to economic or financial circumstances and may not necessarily be updated or revised to reflect those changes that arise after the date of publication. The views, information, or opinions expressed in the report are intended for informational and educational purposes only. It is not intended or offered to be used as legal, tax, investment, financial, or other advice. Under no circumstances are Bitget, our employees, agents, partners, and/or co-operations responsible for any decision made,bitget-annual-briefing-part-three action taken, or result obtained from or in reliance on the use of the information herein. Any investment or trading ideas, strategies, or actions should never be taken without first taking into consideration each individual's personal and financial situation, and/or without consulting financial professionals.

Blockchain101: What is Play to Earn (P2E)?

Have you imagined making money while you are playing online games? It was definitely a myth ten years ago. But now, you don’t need to be a game developer. You don’t need to be a top e-sport player. Everyone like you and me is able to earn money as a gamer on Blockchain games like Axie Infinity, Decentraland, Alien Worlds, The Sandbox… That’s what we call Game-Fi and Play to Earn! In this article, we will walk you through what is Play to Earn (P2E) and the Blockchain games you can cash out. What is Play to Earn (P2E)? Play to Earn (P2E) is the new gaming model based on the Blockchain technology. The greatest feature of P2E is allowing users to earn crypto and non-fungible tokens (NFTs) that can be transacted on the bf59f56c-8e20-49f6-ab2f-0abe4dc60e84, so that they can make money while playing games. In a P2E game, gamers can make money through completing specific missions, holding and transacting in-game assets like virtual land, skins or weapons or contributing to the ecosystem of the game. The P2E game looks like a reality similar to our real life. It has created its own economic system and business models, like transaction system, NFTs, coins, marketing mechanism and governing. Gamers are able to earn an income in it. Three Popular Play-to-Earn ways in Blockchain games in 2022 1. Completing a specific task: Gamers can receive a financial reward when they complete an in-game task, usually crypto or tokens that can be exchanged on the market. In Axie Infinity, gamers will be rewarded AXS tokens for winning battles and tournaments, tending plots of land and breeding Axie. 2. Trading in-game assets: With the Blockchain technology, the ownership of digital assets is represented by NFTs. It allows gamers to carry out transactions of NFTs to make money. In Cryptovoxels, The Sandbox and Decentraland, gamers are able to buy and sell land ownership on markets. In CryptoKitties or Axie Infinity, players can breed their creatures and exchange their represented NFTs to earn tokens. 3. Leasing of the assets: Through adding value to the in-game assets, like developing your own virtual land in Sandbox, you can generate revenue through leasing it for different usages like virtual concerts, events, casinos or virtual shops. Three differences between Game-Fi and traditional online games Playing while earning is definitely a cool idea, especially to young men. Why do traditional online game companies not develop this P2E business model? Here is the reason why: Decentralized vs Centralized: P2E games: They are based on the Blockchain technology. The data on the Blockchain is immutable and distributed on the nodes around the globe, which reduces the risk of losing the data. The ownership of the in-game assets is completely protected as the details of ownership are stored on the Blockchain. That’s the reason why purchasing land in Sandbox has become a trend that so many traditional businesses like Gucci are involved in. Traditional online games: They are based on a central server. If your account is hacked or banned by the game’s admins, you will lose all your in-game assets as ownership is not completely protected in a traditional game, so transactions of in-game assets in a traditional game are not as popular as Game-Fi. Read more: Blockchain 101: Blockchain Basics, Blockchain 101: Blockchain History Transparency vs opaque: P2E games: The rules are completely transparent, the mechanism, trading system and reward system are clearly stated in the smart contract stored on the Blockchain, which is executed automatically and immutable. The play-to-earn game Axie Infinity is based on Ethereum, which players can collect, breed, raise, battle against and trade with other online users. Every gamer is able to access the rules. The game developers can’t change the rules to take advantage of gamers easily. Traditional online games: The rules are completely controlled by the games companies. The founder of Ethereum, Vitalik Buterin, has complained that the character he loves was banned in a traditional game. That raised his awareness of decentralization. Open vs Closed ecosystem: P2E games: Through holding the non-fungible tokens(NFT) issued by the game, gamers have the power of governance and the voting right to determine the future development of the game. They can create their own in-game assets like skins, weapons and virtual buildings and trade them on the market. It encourages gamers to create a more user-friendly ecosystem. Decentraland is a virtual reality platform that allows gamers to construct their own 3D world — from building a game to opening an online store. Traditional online games: All game settings are decided by game companies. Gamers almost have no say in the development and setting of the game. Five popular Game-Fi protocols Play-to-Earn games are usually developed based on the Blockchain platforms supporting smart contracts like Ethereum. With Play-to-Earn becoming more and more popular, the cost of running games on Ethereum becomes more expensive. It leads to the development of different platforms supporting the smart contract like: Solana: A decentralized computing platform that uses SOL to pay for transactions. Both a cryptocurrency and a flexible platform for running decentralized apps (D-apps). Polygon network: A decentralized Ethereum scaling platform that enables developers to build scalable user-friendly dApps with low transaction fees without ever sacrificing on security. Polkadot: An open source, Blockchain platform allows for cross-chain transfers of data or assets between different blockchains, and for cross-chain D-Apps to be built using the Polkadot Network. OKC: Providing a secure and programmable smart contract platform for Web3 applications. Wax: WAX is a purpose-built blockchain and protocol token designed to make transactions faster, easier, and safer for all participants. Disclaimer: All products and projects listed on this article are not endorsements, and are provided for informational purposes only.

What Are Cryptocurrencies, And Why Do You Need Them?

Cryptocurrencies are digital currencies secured by cryptography and blockchain technology to prevent double-spending and tampering. Okay, so why do we have to go through all the trouble to use digital currencies? This question will open a whole can of worms. It is best to understand cryptocurrencies through the OG, Bitcoin. We had an article detailed how Bitcoin works, so let’s do a short recap here. Bitcoin was initially designed as a peer-to-peer electronic cash system that is decentralized, transparent, and immutable. Why are we so fond of Bitcoin and treat it as a store of value, like gold? IT IS IMMUTABLE; TRUST THE TECH Bitcoin is built upon blockchain, and blockchain is inherently immutable. Blockchain is a database storing data blocks chronologically where one block is linked after another using cryptography. If they want to alter the data in a block, they will have to rewrite the entire data strain in the blockchain. The Bitcoin network utilizes this technology to store immutable transaction records. Therefore, in the world of crypto, we do not entrust a third party to execute our transactions on our behalf. Instead, we trust the protocol to maintain transactions for us. No manual error; No human tampering; No middleman. NO ONE CAN STOP YOU FROM USING IT On top of its immutability, the Bitcoin network is also decentralized, where no single authority has the right to issue it or prohibit one’s usage of it. How decentralized is it, you ask? The Bitcoin network is secured by multiple nodes simultaneously across different geographic locations and in the hands of different individuals. Therefore, no one could tamper with the transaction records of Bitcoin. That is why, unlike a bank that could freeze your savings to look for “suspicious activities,” no one could stop you from receiving and sending Bitcoin. Since Bitcoin is a digital coin without a physical form, you could send receive it across the world via your smart devices without the need for intermediaries. IT HOLDS VALUE, UNLIKE FIAT In our modern society, the idea of money revolves around using fiat currency, which is a representation of value, to exchange goods and services. The problem is that the supply of fiat currency is increasing exponentially, which means the same 1 dollar in your hand will not carry the exact value of 1-dollar next year. People treat Bitcoin as a store of value because it has a finite supply of 21 million BTC. Only so many BTC could be ever mined into circulation. The scarcity and usage made Bitcoin the “Digital Gold” in the eyes of many. Although not every cryptocurrency has a finite supply, the inflation rate and supply in circulation are often taken very seriously in the realm of crypto. Other cryptocurrencies have alternate, practical mechanisms to counter inflation, such as Burning, making fiat currency look like money created in thin air. Moreover, the security and value of the Bitcoin network only grow over time as the network expands. With more nodes joining the network, it is harder for bad actors to tamper with the data as every network change should have the majority consent of the network. In other words, more decentralized; more secure. With its value and decentralized feature, no one could stop you from sending and receiving cryptocurrency in exchange for goods and services in this world. That is also why Bitcoin is called the “Sound Money”. INSTITUTION IS BUYING IN If you are reading this article, you have already heard of some giant institution going into the crypto space, and they are not wrong. More leaders in different industries have been jumping into the crypto space recently. Not only banks and institutions are thinking of ways to connect with crypto, but countries are also struggling to get in too. Countries with more lenient regulation on crypto are winning the tug-of-war of talent population as there is a talent vacuum in the crypto industry. Some countries go as far as considering Bitcoin as legal tender. In summary, cryptocurrencies started to receive massive adoption, and we know the sky is the limit from here. BEYOND BITCOIN It is hard to believe, but there is more to cryptocurrency than Bitcoin. Every crypto aside from Bitcoin is called “Altcoin,” and the greatest altcoin of all is Ethereum. Ethereum has something a little more than Bitcoin, called Smart Contract. Smart Contract is a program on blockchain that will execute automatically when certain predetermined conditions are met. This feature transformed blockchain from a mere ledger of transaction records to a virtual computer. That is why Ethereum is also known as the Ethereum Virtual Machine. Alright, it is a virtual computer, now what? Well, it is everything. Smart contracts enable blockchain to push a database into a machine that could execute predetermined commands. Many buzzwords we heard in the crypto space like Defi, Dapp, and DAO all required smart contracts. DAPP If smart contracts had made blockchain a virtual computer, naturally, developers could program new applications on top of it. Spoiler alert, they did, and it is called Dapp, which stands for decentralized applications. The unique property of blockchain also applies to Dapps, such as transparency, decentralization, etc. On the surface, Dapps are no different from regular applications, but a typical application run by a centralized authority could take control over all the data without you knowing it. However, Dapps are not run by a centralized authority, and most of them are open-sourced, which means you are not using the Web3.0 app in expends of your privacy, unlike every app you are using in Web2.0. DEFI Decentralized finance, also known as Defi, revolutionized how people perceive finance. Banks and financial institutions had a strong oligopoly over financial services, such as borrowing, lending, and investing. By holding a tight grip on financial services, they could harvest tremendous gains. Since smart contracts are known for cutting out the middlemen, which is the bank in the case of finance, financial activity is much more profitable for common men like you and me. Gone the day where 5% interest rate is considered a great deal, many defi projects could easily offer over 10% interest rate when you lend your crypto to the platform. They could offer this rate simply because there is no third party to steal a slice from the pie. DAO Smart Contracts also enable the possibility of DAO. DAO, also known as Decentralized Autonomous Organization, enables stakeholders to participate in the decision-making of an organization through holding its governance token. Like buying stocks of a company, the only difference between a DAO and a regular company is that the smart contract will execute the command when the DAO has reached a consensus. Therefore, DAO could execute changes automatically, which are transparent to everyone and save tons of expenses like labor costs. In fact, many Defi and Dapp projects on the blockchain are running in the form of DAOs. NFT AND METAVERSE Finally, aside from smart contracts and the benefit they bring, cryptocurrencies also got us NFTs! We have lived in this digital embedded world since the birth of computers and the internet for decades, yet we haven’t found our way to digital ownership until we have non-fungible tokens (NFTs). NFT had taken the world by storm, and it has the reason to. NFT is a non-interchangeable unit of data stored on the blockchain. Essentially, you could finally own the data. Combining the grand vision of Metaverse people cannot stop talking about, NFTs will play an essential role in the future. All and all, cryptocurrencies are disruptive and innovative; they have proven themselves by changing people’s perceptions of the world. People will survive as a no-coiner now; how about the future? Disclaimer: This is not financial advice and cannot be treated as such. Please consult a professional financial adviser before investing any digital assets and do your due diligence before any investment regarding cryptocurrency as it is highly volatile.