Connect with us

Bitcoin

The good news for ETH hodlers about insane gas fees

Published

on

Ethereum and DeFi proponent Ryan Sean Adams has drawn attention to how high gas fees relative to the current Ether price could actually be a bullish sign.

Citing this week’s Grayscale research paper ‘Valuing Ethereum’ the Bankless commentator claimed that Ethereum is “actually getting cheaper” from a price to sale ratio aspect.

A price to sales ratio (P/S) is usually calculated by taking a company’s market capitalization and dividing it by revenue from sales. In this case, taking Ethereum’s $184 billion market cap dividing it by the total revenue derived from transaction fees provides a similar metric. The lower the P/S ratio, the more attractive the investment (although there’s debate as to how applicable it is to decentralized digital assets.)

Advertisement

According to the Grayscale report, Ethereum’s P/S ratio at the start of 2021 was the lowest it has been for over three years at around 0.02.

While Ethereum is not a company, and transaction fees are not technically sal revenue, institutional-grade investment vehicles such as Grayscale often use traditional methods to help value assets. The report said:

“A lower ratio indicates that the network is generating high revenue relative to Ether’s historical market capitalization, and thus may be undervalued.”

Given the enormous effort going into reducing ETH fees with Eth2, layer-two scaling and the Ethereum Improvement Proposal EIP-1559, this revenue is also far from guaranteed into the future.

Advertisement

However, high transaction fees are indicative of high demand on the network, which is good news for miners and long term holders (if not for those wanting to use it on a daily basis.)

According to BitInfoCharts, the average Ethereum transaction fee has skyrocketed to an all-time high of around $23. This makes using the network totally unviable for smaller transactions which eliminates a lot of DeFi activity for the average trader or investor.

Grayscale and Ethereum advocates, on the other hand, see the positive aspects:

Advertisement

“We can observe from the data that the price of Ether tends to move with underlying activity on the network […] multiple metrics are reaching new highs, including active addresses, hashrate, and network fees – a positive sign for investors.”

Grayscale also suggested that the gas-lowering EIP-1559 could create a positive feedback loop which is extremely bullish for ETH prices.

News Source

Advertisement

Bitcoin

The Cycle Started, Mike Novogratz Says – Bitcoin Boom Is Here; Jack Dorsey Boosts BTC’s Price

Published

on

Mike Novogratz is one of the essential names in the crypto space which is celebrating the booming price of Bitcoin.

Check out what he had to share with his followers and Twitter fans:

Advertisement

Someone hopped in the comments section and said this; ‘Anyone who has not yet embarked on the crypto band wagon is a simple minded idiot who knows nothing about markets, freedom or wealth creation.’

Jack Dorsey boosts the price of BTC

It’s been also revealed that Jack Dorse said that Square could build a BTC mining system – this obviously triggered a more massive price race for the king coin.

At the moment of writing this article, BTC is trading in the green and the king coin is priced at $61,118.15.

Advertisement

CNBC online publication just noted that Square CEO Jack Dorsey said late on Friday the company is considering jumping into BTC mining business.

Dorsey tweeted that the company is considering a “bitcoin mining system based on custom silicon and open source for individuals and businesses worldwide.”

Advertisement

Dorsey’s goal would be to make crypto mining more accessible. We suggest that you check out the complete thread that Dorsey shared on his social media account in order to learn all the available details.

News Source

Advertisement
Continue Reading

Bitcoin

Pantera Capital’s Dan Morehead: Bitcoin (BTC) Already Up 100% in This Bull Run

Published

on

How big is median increase in Bitcoin (BTC) price in bullish market phases?

As Bitcoin (BTC) reclaims $62,000 level, Dan Morehead, CEO of the first-ever cryptocurrency-focused VC firm in the U.S., shares the comprehensive statistics of the last six bull runs for Bitcoin.

Bitcoin (BTC) price doubled in 87 days: Bull Run 2021

According to the latest tweet by Mr. Morehead, the Bitcoin (BTC) price witnessed a 2x increase in the first 87 days of the ongoing bullish wave.

Advertisement

Unlike many other experts, Mr. Morehead identifies two separate “bull run” phases in 2020-2021. During the previous one, between March 16, 2020, and April 14, 2021, it took 394 days for Bitcoin (BTC) to increase its price 13x and print a new all-time high.

According to his infographic, the most impressive rally ended with a 106x increase of the orange coin’s price in 2015-2017.

Advertisement

That said, the median Bitcoin (BTC) price bull run lasted for 300 days and increased the “king coin’s price” by 15x.

Will Bitcoin ETF mark the top of the BTC cycle?

At the same time, according to “The Next Price Era” letter issued by Pantera Capital on Oct. 6, 2021, the hotly-anticipated approval of Bitcoin (BTC) ETFs is listed amidst the possible “sell the news” events.

Mr. Morehead noticed that the launch of CME Bitcoin Futures and Coinbase direct listing triggered painful bear markets:

Advertisement

Will someone please remind the day before the bitcoin ETF officially launches?  I might want to take some chips off the table.

As covered by U.Today previously, similar statements were made by CNBC’s Jim Cramer.

The seasoned analyst also revealed his plans to “cash out” 50% of his Ethereum (ETH) bags.

News Source

Advertisement
Continue Reading

Bitcoin

Bitcoin Will Significantly Underperform Altcoin Market As New Crypto Price Era Unfolds: Pantera Capital’s Dan Morehead

Published

on

The founder and chief executive officer of Pantera Capital says that investors can expect altcoins to outperform Bitcoin (BTC) in the long term.

In a recent edition of Pantera’s Blockchain Letter, the head of the digital asset management firm outlines Dan Morehead’s key quotes from the SALT 2021 conference in New York. During the conference, Morehead said that even though his company has greatly profited from BTC, he emphasized that most future crypto gains will come from altcoin investments.ADVERTISEMENT

“My perspective is: Bitcoin has been amazing – Pantera Bitcoin Fund is up 67,000% since inception. However, I think the majority of future gains will be from tokens outside of Bitcoin. I know that sounds heretical to some people here, but that’s my professional opinion.”

Advertisement

Morehead compares the rise of Bitcoin and its competitors to that of the tech industry boom during the late 1990s.

“It’s like saying in 1998 that [the] majority of future tech gains would come from outside Microsoft.

At the time, Microsoft was worth $218 billion, Apple $3.5 billion, Amazon was $2.2 billion. Google and Facebook were zero – they didn’t even exist. In the years since Microsoft did great – it went up 10x. However, 80% of the tech gains in these five stocks came from outside Microsoft.

Advertisement

That’s the view I have here – I think BTC is going to go up a ton – like 10x. It’s a great investment…[but] I think the broader portfolio is going to outperform.”

At time of writing, BTC has a market cap of $1.156 trillion while all altcoins combined have a market cap of $1.327 trillion, according to CoinMarketCap.

News Source

Advertisement
Continue Reading