Binance Is Still the Top Exchange and Trans-Fee Mining Exchanges Are Gaining Market Share

Binance Is Still the Top Exchange and Trans-Fee Mining Exchanges Are Gaining Market Share

  
 

 Binance, a pure crypto-to-crypto exchange,
has been found to still be on top of the cryptocurrency exchange market, at a time in which exchanges using the controversial trans-fee mining model have been gaining a bigger piece of the pie. According to CryptoCompare’s December 2018 Exchange Review, Binance has managed to maintain its status as the number one crypto exchange in the ecosystem last month. The document shows that, on average, $664 million worth of cryptocurrencies changed hands on the exchange per day, for a total of $20.5 billion traded in December.

Binance was seemingly also the most visited exchange, after receiving 2.2 million visitors. Its users are currently able to trade 166 cryptos on the platform, on a total of 427 trading pairs. Behind Binance came OKEx, which traded $19.2 billion in December. While Binance, by itself, represented little over 10% of the cryptocurrency exchange market, CryptoCompare also found that exchanges using the controversial trans-fee mining model, which has been described as a “disguised ICO” revenue model, as it reimburses users’ trading fees with tokens.

Trans-Fee Mining Exchanges Gain Market Share

According to the report CoinBene, the number one cryptocurrency exchange using the controversial revenue model, traded $10.4 billion in December, followed by ZBG and EXX, which traded $5.13 billion, and $4.58 billion respectively. In total, trans-fee mining exchanges traded $23.2 billion, equivalent to 12% of the global spot trading volume, up from 7% in October. It has in the past been found that these exchanges have unusually thin order books, and a relatively low amount of traffic, taking into account the total trading volume they have. Thin order books mean these exchanges can see large price swings if their order books face large orders.

Order Book Depth Drops on Top Exchanges

Per CryptoCompare’s report, top cryptocurrency exchanges would have to, on average, face a $2.56 million sell order to see bitcoin’s price crash 10%, a figure that has dropped since November, and is lower on trans-fee mining exchanges.

The report reads:

Bitfinex, Kraken and Bitstamp maintained the most stable markets in December, while exchanges CoinBene, Bitforex, IDAX showed thin markets combined with high volumes.

It adds that on Bitfinex, where an average of $68.5 million were traded in December among its top 5 trading pairs, it would take a $9.5 million order to crash the price 10%, while on CoinBene it would take only a $13,600 order. An analysis of the crypto exchanges’ web traffic showed that these exchanges attracted “significantly lower daily visitors than similarly-sized exchanges.” CoinBene, for example, received 48,000 visitors per day, and traded $10.4 billion in December, while exchanges like Bitfinex and HitBTC with “similar high volumes” attracted over 360,000 visitors.

Article Produced By
Francisco Memoria

News Reporter

Francisco is a cryptocurrency writer who's in love with technology and focuses on helping people see the value digital currencies have. His work has been published in numerous reputable industry publications. Francisco holds various cryptocurrencies

https://www.cryptoglobe.com/latest/2019/01/binance-is-still-the-dominant-exchange-and-trans-fee-mining-exchanges-are-gaining-market-share/

Bitcoin Price Could Go from Bad to Worse’: Bearish Analyst

Bitcoin Price ‘Could Go from Bad to Worse’: Bearish Analyst

   

The most potential use case of bitcoin today is the store of value.

But an analyst thinks otherwise. Stephen Innes, head of Asia Pacific trading at Oanda, a New York-based forex firm, believes that the world’s leading digital currency is due for another drop because it hasn’t provided the world a “significant use-case” yet. The Bitcoin hype, according to Innes, is far ridiculous than the one seen during the Tulip mania bubble.

Since its all-time high at $19,500, bitcoin has plunged more than 80% this year. Since mid-November itself, the digital currency has noted a 48.5% fall owing to specific macroeconomic crypto factors. Just recently, it established a new yearly low near $3,200, which is 83.5% lower than its good days’ peak. “It’s has been a disastrous year for cryptos,” Innes explained, “and by all indication, the current bear market could go from bad to worse with no fundamental or underlying reasons to buy BTC even more so when the only support offered up is a squiggly line on an analyst chart.”

A History Lesson

Either bitcoin cannot be anything. Or, it can be everything.

The digital currency upon its introduction in 2008 posed itself as an alternative payment system that raised its stakes against the popular payment mechanisms. True, bitcoin was much faster, cheaper and totally decentralized than any of its traditional counterparts. But its evolution brought several use cases on the sideways. Sooner, bitcoin was more than a payment mechanism. To some, it was a tradable asset; and to some, it was a currency of underground online marketplaces. The characteristics of bitcoin changed with every user. But, in a larger context, the digital currency remained a multifaceted technology.

Innes is right in pointing out that bitcoin hasn’t offered the world a significant use-case yet, because all succumbed to only one thing: price volatility. Had bitcoin been lesser volatile than it usually is, the digital currency could gain more trust as a payment medium, more so as a store of value. But aren’t we judging it too early, especially when we can always look back at the chapters of other assets that achieved stability only after a considerably long time? Let’s talk about Gold.

In 1971, when the President Nixon government ousted Gold from being the global value standard and replaced it with the US Dollar, the mighty fiat reserve with an infinite supply, the commodity experienced a period of huge volatility. In 1974, the gold bullion rose 73% against the US Dollar but lost 25% of its gains in the very next year. Another instance is rooted in the year 1981 when gold lost 33% of its value after witnessing a 121% pump prior to the fall.

How is bitcoin any different, you decide. The naysayers do not want to define it as a store of value, expecting that it should remain steady to be one. But they shouldn’t forget that older definitions cannot describe the characteristics of newer assets. Bitcoin, for all its technological issues, is still more likely to attain the status of a store of value, given its volatility goes down as people hold it more often than lose it on the first selling sentiment. And, at the same time, its appreciation should slow down after a rapid pump.

That’s how Gold behaved. And that is how bitcoin is acting in its current state. Then again, does Gold have a use case? Only 10% of it was used for industrial purposes. Get more info on this amazing Quora thread.

Article Produced By
CCN
Bitcoin Price News

https://www.ccn.com/bitcoin-price-could-go-from-bad-to-worse-bearish-analyst/

 

Bitcoin Mining Industry Under Considerable Stress’ 13 Million Devices Switched Off

Bitcoin Mining Industry ‘Under Considerable Stress,’ 1.3 Million Devices Switched Off

   

For much of the year, the bitcoin mining industry appeared to be impervious

to the crypto market downturn, as the flagship cryptocurrency’s hash rate continued to climb even as the BTC price halved — and then halved again. In recent weeks, however, cracks have begun to form in this sector as well.

Bitcoin Hash Rate Drops as Miners Turn off Older Devices

Earlier this month, Bitcoin network difficulty, which adjusts dynamically every 2,016 blocks (a roughly two-week interval) in response to hash rate fluctuations, fell by 15.1 percent — its second-largest drop in history and the greatest since Oct. 2011. Just one period earlier, BTC difficulty declined by 7.4 percent, which was the most significant drop in nearly six years. While this does not, as some bears have suggested, mean that bitcoin has begun a death march, it does demonstrate the extent to which the downturn has begun to put the squeeze on miners with higher costs and thinner profit margins, many of whom had anticipated a crypto market that would look very different heading into 2019.

According to BitMEX Research, the Bitcoin hash rate has declined by more than 31 percent since the beginning of November, which is the equivalent of 1.3 million Antminer S9 miners being switched off completely. CCN previously reported that while miner overhead varies wildly based on the size of the operation, energy costs, and other factors, the market decline had hastened the obsolescence of older miner models such as the Antminer S7, which for most users are now little more than expensive paperweights.

Miner Revenue Falling Faster Than Bitcoin Price

Notably, the recent market sell-off has hurt miners even more than ordinary investors. BitMEX Research estimates that cumulative bitcoin mining revenue has declined to $6 million per day at the start of December from $13 million at the start of November, outpacing the bitcoin price’s already-steep decline.” The reason for this is that because network difficulty adjusts at set intervals rather than in real time, a hash rate drop will reduce the number of found blocks until the beginning of the next difficulty adjustment.

As the report explained:

“In the six-day period ending 3rd December, 21.8% fewer blocks than the expected 144 per day were found, as miners left the network before the difficulty adjusted, and as a result, fewer blocks were found. Therefore in the short term, there was a 21.8% fall in mining incentives on top of the impact of the declining price.”

At this point, BitMEX Research estimates that almost all cryptocurrency miners — regardless of scale and overhead — are operating at a loss, though some may have hedged profits or at least trimmed losses by shorting the bitcoin price throughout the year.

Not a ‘Death Spiral’

According to some analysts, this likely means that Bitcoin has entered the outer ring of a “death spiral,” wherein it endures a vicious cycle of miners turning off their machines before the difficulty can adjust lower, preventing the network from processing blocks at regular, 10-minute intervals and further prolonging the interval between difficulty adjustments. Thankfully, as Andreas Antonopoulos recently explained, these ominous predictions fail to account for the fact that most miners are heavily invested in the cryptocurrency industry and thus operate with a long-term perspective that recognizes they may have to temporarily mine at a loss in pursuit of greater profits in the future.

“Part of the reason that’s unlikely to happen is that miners have a much more long-term perspective, meaning that they have existing investments in equipment and they usually purchase electricity on long-term plans, they don’t pay it by the week,” he said. “And therefore, if they have to wait to become profitable another three months and they have the equipment in place, they’re not turning it off.” Consequently, the mining industry’s current struggles shouldn’t have any long-term impact on Bitcoin itself, though that doesn’t make things any easier for the individual cryptocurrency mining firms that must navigate this increasingly rocky landscape.

Article Produced By
Bitcoin Analysis

https://www.ccn.com/bitcoin-mining-industry-under-considerable-stress-1-3-million-devices-switched-off/