Month: May 2021

Bitcoin dominance, the metric that measures bitcoin’s overall market capitalization against all the other crypto asset valuations has dropped considerably in recent weeks. At the end of February, bitcoin dominance levels started sliding downward from 61% to today’s 50%. Meanwhile, from the same point in time ethereum’s market capitalization has increased from 11.8% to today’s 14.5%.

Bitcoin Dominance Sinks to 50%

Ever since the birth of alternative crypto assets, people have used a metric called bitcoin (BTC) dominance, a measurement that records BTC’s entire capitalization against all the market capitalizations held by other coins.

Interestingly, minus a few small dips, BTC’s dominance was above the 80% range from the day it was conceived to February 2017.

Bitcoin's Market Dominance Slides to 50%, While Ethereum's Valuation Climbs Higher

BTC/USD hourly chart on April 23, 2021.

During the first week of January 2018, BTC’s dominance dropped to an all-time low of 33%. This year, bitcoin dominance levels have been mostly above the 60% region and in January 2021, it neared 70%.

However, since February 28, BTC dominance has slid from 61% to a low of 50% on April 23. At the same time from February 28 until now, ethereum (ETH) has climbed from 11.8% to 14.5%.

A Myriad of Competitors Push Bitcoin Dominance Levels Lower

Ethereum’s market cap is not the only coin eating away at BTC’s dominance levels. Binance coin has captured the third position in terms of crypto market valuations and commands 4.33% of the crypto economy’s entire $1.87 trillion market cap.

The stablecoin tether (USDT) holds 2.8%, XRP has 2.25%, and cardano (ADA) has 1.9% today. The top 15th position held by solana (SOL) and all the way to the seventh position dogecoin, commands .50% of the entire crypto-economy or more.

Bitcoin's Market Dominance Slides to 50%, While Ethereum's Valuation Climbs Higher

ETH/USD hourly chart on April 23, 2021.

From October 2020 until today, the overall crypto capitalization excluding bitcoin has increased a great deal from $145 billion to close to a trillion. A great number of coins have seen gains alongside BTC’s climactic bull run, but a few coins, in general, have eaten a lot more than most.

Tokens like ethereum, binance coin, cardano, XRP, and tether (USDT) as well have done the most damage to BTC’s dominance levels.

The U.S. state of Louisiana has passed a resolution to commend bitcoin for its success as well as commend the cryptocurrency’s pseudonymous creator, Satoshi Nakamoto, “for his contribution to economic security.”

State Resolution Recognizing Satoshi and Bitcoin

The Louisiana House of Representatives resolution by Representative Mark Wright entitled, “Commends Bitcoin and the cryptocurrency industry,” has been enrolled and signed by the Speaker of the House. House Resolution 33 (HR 33) reads:

Resolution to commend Bitcoin for its success in becoming the first decentralized trillion dollar asset and to encourage the state and local governments to consider ways that could help them benefit from the increased use of this new technology.

The resolution proceeds to describe various attributes of bitcoin, starting with its creation in 2008 “by the pseudonymous author Satoshi Nakamoto.” Noting that the cryptocurrency “could potentially replace gold as a monetary reserve,” the document highlights bitcoin’s finite supply, noting that it is “completely decentralized” and allows for secure transactions without the need for a trusted third party.

It additionally notes that “not only has Bitcoin proven to be a critical tool for businesses, it has proven to be a critical tool for citizens around the world to protect themselves from currency debasement.”

The resolution mentions another cryptocurrency other than bitcoin, Moxey, which it describes as “a proprietary digital community currency invented in Louisiana.” Its website describes that “Moxey is a community of thousands of business owners who support one another and, most importantly, are able to buy and sell among each other without spending cash. Instead, they use their very own community currency; Moxey dollars.”

In conclusion, Louisiana’s House Resolution 33 states:

The House of Representatives of the Legislature of Louisiana does hereby commend Satoshi Nakamoto for his contribution to economic security.

Turkish Crypto Exchange Exit Scam: CEO Flees Country, 62 People Detained, Users Cannot Access $2 Billion of Funds

Turkish Crypto Exchange Exit Scam: CEO Flees Country, 62 People Detained, Users Cannot Access $2 Billion of Funds

A Turkish cryptocurrency exchange with about 400,000 users has been accused of pulling an exit scam. Its CEO has reportedly fled Turkey, allegedly taking $2 billion of customer funds with him. The police have an arrest warrant for the CEO and 62 people have already been detained in connection with the case.

Crypto Exchange Accused of Exit Scam

Turkish cryptocurrency exchange Thodex is offline and its CEO has reportedly gone missing. Thousands of investors are worried that their funds have been stolen since they are unable to access their accounts.

A statement on the exchange’s website details that the platform is “temporarily closed” to address an “abnormal fluctuation in the company accounts.”

Local media reported that Thodex’s founder, Faruk Fatih Ozer, has fled the country to Albania, allegedly taking $2 billion of investors’ funds with him. Demiroren News Agency published a photo which it claims to be Ozer leaving Istanbul Airport.

Turkish authorities have issued an international arrest warrant for Ozer, the state-run news agency Anadolu Agency reported. Interpol then issued a red notice for Ozer on Friday. Turkish police headquarters said that the country’s interior minister and police chief spoke with their Albanian counterparts on Thursday to seek Ozer’s arrest.

Thousands of users have filed complaints against Thodex saying that they have been scammed. They are unable to access their accounts and are worried that their savings may be irretrievable.

A lawyer who filed a criminal complaint against Ozer said Thodex had 400,000 users, of which 390,000 were active. However, Ozer disagreed, claiming that only 30,000 users have been affected by the situation and that reports about $2 billion of losses are “unfounded.”

Police searched the company’s Istanbul offices and seized materials on Thursday. Arrest warrants have been issued for 78 suspects and police have so far detained 62 people in eight cities, including Istanbul, in connection to the case.

Cryptocurrencies have recently gained popularity among some Turkish citizens looking to protect their savings from soaring inflation and sinking lira. Turkey’s central bank recently banned the use of cryptocurrencies as a means of payment. President Recep Tayyip Erdogan has called for swift regulation of cryptocurrencies, warning of the rising number of pyramid schemes in the crypto markets.

Tax Authority Seizes Cryptocurrencies Worth $25 Million From Hundreds of Crypto Investors in South Korea

Tax Authority Seizes Cryptocurrencies Worth $25 Million From Hundreds of Crypto Investors in South Korea

The tax department of the Seoul metropolitan government in South Korea has reportedly seized cryptocurrencies worth about $25 million from hundreds of crypto investors with delinquent taxes. The cryptocurrencies, including bitcoin, were seized from three exchanges. The tax authority is now going after hundreds more taxpayers who are delinquent on paying their taxes.

Crypto Seizure for Tax Payments

The Seoul metropolitan government announced Friday that it has seized cryptocurrencies from hundreds of individuals who are delinquent on their tax payments, Yonhap reported.

Cryptocurrencies belonging to 1,566 individuals, including heads of companies, have been identified by the city government’s tax collection department at three cryptocurrency exchanges. So far, the tax authority has seized the coins from 676 people who owe the government 28.4 billion won (approximately $25.47 million) in overdue taxes. It will soon go after the crypto assets of the other 890 people.

Since the crypto seizure, 118 taxpayers have paid back 1.26 billion won, the city government said, elaborating:

We are continually being asked by delinquent taxpayers to refrain from selling their cryptocurrencies as they will pay their taxes.

“We believe the taxpayers expect the value of their cryptocurrencies to increase further due to the recent spike in the price of cryptocurrencies and have determined they will gain more from paying their delinquent taxes and having the seizure released,” the government described.

The city government gave an example of the head of a hospital whose cryptocurrencies were confiscated. He asked the authorities not to sell his coins and immediately paid 580 million won out of the 1 billion won he owed in unpaid taxes and provided security for the rest.

Similarly, another taxpayer asked the government not to sell his seize cryptocurrencies worth 3 million won, pleading that in two years, their value will grow substantially and will more than cover his delinquent tax of 20 million won.

According to the tax authority, the most popular cryptocurrency among delinquent taxpayers is bitcoin (19%), followed by Dragonvein and XRP, both at 16%. The next most popular crypto is ethereum (10%) and then stellar (9%).

China's Carbon Neutral Stance Puts Pressure on BTC Miners, Sichuan Electricity to Increase 150%

Bitcoin’s global hashrate dropped ten days ago following a coal mine accident that caused significant podcast grid blackouts in Xinjiang, China. While initial estimates had shown more than 40% of the hashrate dropped, statistics from a five-day average show the hashpower only lost around 25%. Meanwhile, Chinese miners located in Sichuan may put more pressure on hydropower resources, as province officials have revealed electricity rates are scheduled to increase 150% this year.

Sichuan Electricity Trading Division Report Notes Electrical Prices in the Region Will Increase by 150%

Mining bitcoin is extremely competitive and miners are spread out all around the world in order to obtain the cheapest electricity rates they can acquire. Because electrical costs in China are far less than a great number of regions around the world, a large portion of bitcoin miners reside in the country.

At one time years ago it was estimated that more than 65% of the hashrate was in China, while more recent studies have shown the concentration has dropped to around 50% of the hashrate.

Following a recent hashrate drop in the province of Xinjiang, a regional report notes that people leveraging electricity in Sichuan may see an electrical cost increase. Financial columnist Priyeshu Garg explains that Sichuan electricity powered by carbon materials will increase by 150% this year.

The revelations stem from the Sichuan Electricity Trading Division who revealed the increase on April 10, 2021. However, the increase will likely be felt by non-mining entities leveraging Sichuan’s grid first, because officials want to decrease dependency on the use of thermal power from coal mines.

As Coal Mine Electric Prices Increase and Carbon-based Power Facilities Are Decommissioned, Demand for Hydropower Is Expected to Rise

China’s bitcoin trading carbon-neutral policy aims to reduce the dependence on carbon-based power, making it so non-mining entities will be forced to use hydropower too. Bitcoin miners in Sichuan already use the region’s hydropower and can get around $0.02/kWh.

Priyeshu Garg says the relatively inexpensive $0.02/kWh rate in Sichuan increased by 16% since last year. The Sichuan Electricity Trading Division’s report estimates that bitcoin miners alone will consume 11.3 billion kWh in 2021.

The regional reporter notes that with the rainy season starting soon, more bitcoin miners are expected to migrate to Sichuan in mass numbers. Accordingly, this will boost the dependency on all hydropower resources and if other non-mining entities are competing for this type of power, hydropower could see a price increase follow suit.

The Sichuan Electricity Trading Division notes that the current amount of hydropower available is already short in supply.

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