Current State of The Crypto Market (April 7th, 2019)

Current State of The Crypto Market (April 7th, 2019)

Hackers:   Those behind Bancor’s security breach last year have recently started moving their stolen ether after months of inactivity, seemingly to popular cryptocurrency exchange Huobi. The move may have seen them liquidate the stolen funds.  According to Elizabeth Yeung, a cybersecurity researcher with the Sentinel Protocol, the Uppsala Security Operations Team picked up on the move and analyzed blockchain data to reach its conclusion.  It started off with the “Bancor Hack” address annotated on Etherscan, which initially received the roughly $12.5 million worth of ETH stolen from the decentralized exchange. Following its trail, the team found that nearly all of the ether was moved to an address that then split the funds through various transactions.  Its analysis found that although various transactions were made, nearly all of the ether ended up in an address. This address was identified as a relay wallet, which means it’s a wallet that “immediately transfers tokens out to one address whenever it receives them, minus a tiny portion spent on gas.”


Bullish Key Players:   As usual when the Bitcoin price shoots up, there is a mad scramble to explain the sudden shift. Speaking to Reuters, Oliver von Landsberg, CEO of crypto firm BCB Group, offered one potential explanation:  “There has been a single order that has been algorithmically-managed across these three venues [Coinbase, Bitstamp, and Kraken], of around 20,000 BTC… If you look at the volumes on each of those three exchanges – there were in-concert, synchronized, units of volume of around 7,000 BTC in an hour”.  Landsberg went on to state that the Bitcoin price action caused by these large, anonymous orders had triggered a flurry of automated trading. However, the reasoning behind the timing of the orders Landsberg refers to remains a mystery.  Bloomberg did speculate that an April Fools article claiming that the long-awaited Bitcoin ETF had finally been approved by the SEC could have triggered a frenzy of buying action, perhaps even influencing the placing of the orders cited by Reuters. However, other prominent individuals from the crypto industry were less inclined to draw such conclusions. The CEO of exchange platform Binance, Changpeng Zhao, Tweeted the following: “anyone know any news?  I have been asked “a few” times, but honestly clueless.”  Meanwhile, caring less for reasons, others have proclaimed that the sudden upwards movement of the Bitcoin price is indicative that the bear market of 2018/19 is well and truly behind us.


Banks & Institutions:  Almost 30 percent of the equity in WEG Bank AG, a previously obscure German bank focused on the real estate industry, is now owned by companies in the cryptocurrency industry.  By purchasing 9.9 percent of the bank, blockchain startup Nimiq now joins TokenPay and the Litecoin Foundation as part owners of the Munich-area financial institution. (Under German law, foreign ownership stakes of 10 percent or greater require additional regulatory approval.)  TokenPay became the first crypto company to acquire the bank’s equity in 2018, with the Litecoin Foundation joining the bank’s stakeholders in a related move. Then WEG Bank partnered with Nimiq to help develop infrastructure for external crypto-to-fiat conversions for banking clients.  Nimiq raised roughly $12.8 million in a token sale in 2017 and, much like TokenPay, has invested its ICO funds in other assets as well, such as real estate and now equity.


Adoption:   Brian Armstrong, CEO of major United States cryptocurrency exchange Coinbase, believes that crypto mass adoption mostly depends on volatility, scalability and usability. Armstrong made his claim during a live ask-me-anything session on April 2.  Armstrong ran the 45-minute AMA on Tuesday, answering selected questions submitted by the crypto community. Addressing the first question, on the potential for mass crypto adoption, Coinbase’s CEO said that a cryptocurrency can achieve mass adoption by improving scalability and usability, while reducing volatility.

The adoption of virtual currency has been riding high in Eastern and Central Europe with Croatia and Slovenia seeing waves of use-cases. Several retail stores are integrating crypto-centric payments applications within their services and offering a variety of support coins.  Elipay, the crypto-payments applications on iOS and Android, spearheaded by Eligma has seen waves of increased adoption. The application supports Bitcoin, Bitcoin Cash, Ethereum and its native token ELI.  The hotbed for the Elipay integration is Bitcoin City, a 475,000 meter-squared commercial shopping complex in the heard of Ljubljana, the capital of Slovenia. Several stores within the “city” have integrated the crypto-payments application and its supported coins.

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