This text was written by Simon Peters, Market Analyst at eToro.
the The price of bitcoin has surpassed $20,000 for the first time since November last year as the cryptocurrency continues its amazing journey. After trading below $16,300 on the platform eToro at the end of 2022, Bitcoin jumped 29% to trade just below $20,900.
Ether price saw a similar rebound, trading just above $1,550 for the first time in two months. Last week, ETH started below $1,300, marking a 19% gain in just seven days.
The cryptocurrency markets are growing though traditional equity markets are experiencing some recovery. Several news including slowing US inflation cheered markets, but the jump in cryptocurrencies was much stronger than that of other asset classes.
We are still only at the beginning and caution is therefore required for investors. At times like this, markets are used to being turbulent and we get bad news every day. Long-term investments and time horizons remain key.
Bitcoin mining difficulty hits a new high
Bitcoin mining difficulty hit a new all-time high on Sunday, with an increase of 10.26% to 37.73 trillion. This increase comes as Bitcoin’s hash rate also hit a new all-time high on January 6, 2023. The difficulty and hash rate usually increase due to increased competition between miners, which clogs up the network.
The abundance of miners and the high levels of competition on the network, which increase the hash rate, are usually a good thing. While there is no correlation with price, the more miners on the network, the more secure it is.
It is also a common sign during or after bearish episodes, when the fund’s usage and development continues despite falling prices, and can be seen as a positive long-term indicator.
Miners have struggled in recent months with the price of bitcoin remaining at low levels, but with the hikes taking place now, they could see their operations become more profitable again.
Shiba Inu Level 2 Blockchain “Shibarium” is getting closer to its goal
The development of a level 2 blockchain for the crypto-asset game based on shiba inus (SHIB) is nearing completion. The developers have released the details on the functioning of the project e the imminent arrival of the beta version of Shibarium.
The most important aspect of Shibarium is enabling greater scalability and faster transactions for SHIB tokens. It is also increasing use cases for developers, such as NFTs and the provision of transaction fees to counter gas cost spikes on the network.
Introducing a Tier 2 chain into a crypto-asset ecosystem can be a controversial development. Generally, it is done when the original blockchain suffers from some problems, such as slow transactions, and requires developers to build another network on top of the original to improve functions and performance.
El Salvador takes one step closer to bitcoin bonds
El Salvador has taken a step towards offering Bitcoin bonds – called volcanic bonds – after that the country’s congress approved the legislation for their launch on Wednesday. These volcanic bonds were designed to help the country – one of the first in the world to adopt Bitcoin as its official currency – to raise funds to build its “Bitcoin City”.
President Nayib Bukele, who has been the face of all the bitcoin business in the country, wants to build a bitcoin-financed city that harnesses the geothermal energy of El Salvador’s many volcanoes.
The new legislation allows the country to offer digital securities in the form of blockchain sovereign bonds, backed by the Bitcoin assets the country has accumulated. El Salvador’s congress overwhelmingly approved the planbut we have yet to see these assets for sale on the open market.
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