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Coinbase effect and strong fundamentals send Polygon (MATIC) and Skale higher

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In previous bull markets, one of the most consistent price movers for cryptocurrency projects was being listed on Coinbase, a phenomenon that became known as the ‘Coinbase effect’.

The recent announcement that Polygon (MATIC), SKALE (SKL) and SushiSwap (SUSHI) would be added to the exchange and begin trading on March 11 has proven that the Coinbase effect remains potent as the tokens witnessed record trading volume and double-digit price movements since the listing took place.

MATIC/USDT vs. SKL/USDT vs. SUSHI/USDT 4-hour chart. Source: TradingView

Data from Cointelegraph Markets and TradingView shows that SKL has been the biggest beneficiary of the Coinbase effect, increasing more than 200% since the announcement on March 9, while MATIC has grown by 88% and SUSHI has gained a modest 7%.

SKL/USDT

SKALE describes itself as an ‘elastic network’ that is designed to bring scalability to the Ethereum (ETH) network by boosting transaction capacity and reducing latency as a way to ensure payments can be conducted as inexpensively as possible.

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According to the project’s website, Solidity smart contracts can run “thousands of times faster at a fraction of the mainnet cost” and the platform is well-suited for gaming and content streaming services that get bogged down by congestion on the main Ethereum network.

SKL/USDT 4-hour chart. Source: TradingView

Congestion and high transaction costs on Ethereum have once again emerged as a significant issue in the cryptocurrency community over the past two months as the lure of decentralized finance and non-fungible tokens have led to significant increases in network activity and gas fees.

MATIC/USDT

Polygon (MATIC) has been on a roll so far in 2021, with the Coinbase listing being the most recent event that has boosted the altcoin’s price.

Previous significant developments include the rebranding from Matic to Polygon, which was done as the project pivoted toward becoming the “Polkadot of the Ethereum network,” by focusing on bringing interoperability with separate blockchain networks to the Ethereum ecosystem.

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Since the rebranding, multiple projects have integrated with or migrated to the layer 2 solution which offers significantly reduced transaction costs and faster confirmation times.

MATIC/USDT 4-hour chart. Source: TradingView

The price of MATIC has increased by 150% since the Coinbase listing announcement and on March 12 the altcoin saw a record $2.6 billion in 24-hour trading volume.

VORTECS™ data from Cointelegraph Markets Pro began to detect a bullish outlook for MATIC on March 6, prior to the recent price rise.

The VORTECS™ score, exclusive to Cointelegraph, is an algorithmic comparison of historic and current market conditions derived from a combination of data points including market sentiment, trading volume, recent price movements and Twitter activity.

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VORTECS™ Score (green) vs. MATIC price. Source: Cointelegraph Markets Pro

As seen in the chart above, VORTECS™ score registered a high of 81 on March 6, three days prior to the announcement of the Coinbase listing. After pulling back to a low of 48 on March 8, the VORTECS™ score then increased to a high of 89, roughly two days before the price rally to a new all-time high.

SUSHI/USDT

SushiSwap (SUSHI) was the third coin listed on Coinbase this week and it received a more subdued response even though SushiSwap is one of the top decentralized exchanges and it currently has $4.21 billion locked in its protocol.

Decentralized finance has been one of the hottest topics in the cryptocurrency sector since December 2020, but has seen a noticeable pullback in activity over recent weeks as nonfungible tokens have stepped into the limelight.

SUSHI/USDT 4-hour chart. Source: TradingView

SUSHI had previously seen its price grow 675% in 2021, from a low of $2.69 on Jan. 1 to an all-time high of $20.57 on March 2, so it’s not completely unexpected that its price had a more muted response to the announcement of a Coinbase listing.

One notable correlation between the three projects discussed has to do with offering solutions to the current issues plaguing the Ethereum network.

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While the Coinbase effect might have helped jumpstart the recent price gains for each project, the larger needs of the cryptocurrency community and the solutions offered by these protocols have MATIC, SKL and SUSHI well positioned to see further upside as active participation in the cryptocurrency ecosystem continues to increase.

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Grayscale’s Top Executive Joins Robinhood as New Chief Compliance Officer

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Robinhood hires a new CCO, the chief compliance officer of Grayscale

Robinhood brokerage app has welcomed Benjamin Melnicki as a new Chief Compliance Officer, who is also the holder of the same position at Grayscale Investments. He joined Grayscale in early January this year.

At the moment, Robinhood’s cryptocurrency arm is facing scrutiny from financial regulators. Last year, Robinhood was a target of an investigation connected to anti money laundering and certain cybersecurity problems experiences by its crypto division.

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As reported by U.Today previously, later this year, the brokerage firm plans to roll out cryptocurrency wallets for its users. The trials of wallets will kick off in October and will allow customers to deposit and withdraw cryptocurrencies to addresses beyond Robinhood seamlessly.

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Average Aussie crypto portfolio grew 258% in FY 20-21, survey reveals

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The average portfolio size on Australian cryptocurrency exchange BTC Markets has grown from $577.65 (795.5 Australian dollars) to $2,069.16 (2849.5 AUD) in the financial year 2021, signaling a 258.2% increase in portfolio holdings, according to exchange data compiled by Statista on a recent BTC Markets survey.

Data on the survey shows that the average portfolio size of female and male investors in fiscal 20-21 on BTC Markets was $1,924.30 (2,650 AUD) and $2,214.03 (3,049 AUD), respectively. However, in 2020, the average portfolio size of female Aussie investors exceeded male investors slightly. 

Transaction data on the exchange also showed a pattern of growing investment demand with aging. Considering the data provided by BTC Market on Australia’s average initial investment, investors above 65 years old have invested roughly $3,158.03, the highest ofall demographics.

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Following an incremental reduction across the various age groups, the youngest cryptocurrency traders, ranging from 18 to 24 years, tend to make comparatively small investments, standing at $792.96 on average. While older Australian crypto investors outweigh the new generation in initial investment, the younger crowd shows comparatively more activity in terms of daily trades.

Resonating the findings above, a September report from financial comparison website Finder shows that one in six Australians own cryptocurrencies, amounting to $8 billion in total investment. The report suggests that, like many other users in advanced industrialized countries, Australians were increasingly viewing cryptocurrencies as a new asset class. 

According to Cointelegraph’s report on the matter, Bitcoin (BTC) is the most popular cryptocurrency for the Australian crypto market held by 9% of investors. Other popular investments include Ether (ETH), Dogecoin (DOGE) and Bitcoin Cash (BCH). The report showed that, despite the growth in crypto investments, a significant barrier to entry for Australians is the difficulty in understanding crypto and the risks related to volatility.

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Switzerland to Impose Anti-Money Laundering Rules on Crypto Providers: Report

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FINMA requires all cryptocurrency providers to step up their game and monitor whether criminals use digital assets in illicit transactions.

The Swiss Financial Market Supervisory Authority – FINMA – would reportedly require local digital asset providers to take additional steps in preventing criminals from employing cryptocurrencies. The watchdog would also turn its sight towards bitcoin ATMs as it believes that drug dealers often use these machines.

FINMA Targets Criminals Operating with Crypto

According to a Finews report, Switzerland’s financial regulator – the Swiss Financial Market Supervisory Authority or simply FINMA – would closely supervise local crypto providers as an attempt to clamp down on money-laundering transactions.

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Swiss platforms and brokers dealing with digital assets would have to enhance their monitoring efforts and observe if bad actors employ cryptocurrencies. The Bern-based watchdog believes the initiative is “urgently necessary,” stressing that criminals use the asset class even to fund terrorism acts.

FINMA also turned its attention towards bitcoin automated teller machines. According to the regulator, drug dealers frequently use such ATMs as payment systems. It is worth noting that Switzerland is a relatively small nation, but its 130 Bitcoin automated teller machines place it in the sixth position among the countries with the most stations.

FINMA also passed an anti-money laundering provision according to which it lowered the threshold for unidentified crypto purchases from 5,000 Swiss Francs (CHF) to 1,000 CHF (around $1,080). Or, in other words, all financial providers dealing with digital assets have to collect data on anyone initiating transactions that exceed this amount.

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UBS: Crypto Regulations Could Spell Trouble

One of the leading banks in Switzerland – UBS – recently shared its views on the hot topic of digital asset regulations as it indicated that implementing certain rules might negatively impact the market.

Furthermore, the bank warned its customers that regulatory crackdowns can pop the “bubble-like” crypto markets. The Swiss bank also labeled the asset class as “speculative” alerting that it could be dangerous for professional investors:

“While we can’t rule out future price gains in cryptos, we see this as a speculative market that poses significant risks to professional investors.”

On another note, though, when the cryptocurrency market was booming at the beginning of May, UBS demonstrated a different attitude. Back then, it intended to enable its wealthy customers to receive digital asset exposure later in 2021 through third-party vehicles.

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