Institutional interest in Ethereum surges in 2020 Q1 amid the ongoing economic crisis
Recent Grayscale data shows a surge in institutional investment in Ethereum and Bitcoin. Grayscale’s Q1 2020 report highlighted the increasing interest in Ethereum and the massive amounts of money that the company has received from investors. It is noteworthy that there has been a record quarterly inflow into the Grayscale Ethereum Trust during this period.
Spencer Noon, the head of crypto investments at DTC Capital, said that Ethereum has reached a turning point with high-net-worth investors.
Institutional investors are buying ETH. The cat is officially out of the bag. From the latest Grayscale report:
[Grayscale] Ethereum Trust saw $110M in Q1 inflows. This is more than all of its previous inflows combined for the past 2 years ($95.8M).
The last few weeks of this quarter witnessed inflows into Ethereum that actually surpassed Bitcoin. In the first quarter, investors poured a whopping $389 million into the Grayscale Bitcoin Trust in addition to the $110 million invested in the Grayscale Ethereum Trust – totaling $498.9 million.
Grayscale’s digital asset trusts are all completely backed by real cryptocurrency. Across all of its products (which also offer exposure to XRP, Bitcoin Cash, Litecoin, Ethereum Classic, Stellar Lumens, Zcash and Horizen) Grayscale has reported a record inflow total of $503.7 million. The firm says investors are turning to its products despite the ongoing global economic crisis.
Investors are tactically using drawdowns to increase their exposure to the asset class, even in a ‘riskoff’ environment. Our institutional investor segment also continued to expand, a trend that could gain additional momentum as legacy financial institutions reinforce the investment thesis for the asset class.
Additionally, as existing investors allocate to multiple products, the investment community should monitor the expansion of increased demand for diversification within the asset class.
Latest Ethereum price and analysis (ETH to USD)
As the financial world focuses on the capitulation of the price of oil cryptocurrency speculators are weighing up the potential of a possible Ethereum breakout.
The world’s second largest cryptocurrency, which has a market cap of $19 billion, is currently trading at $170.78 after surging by more than 13% in the past week.
It momentarily broke above the crucial daily 200 moving average on April 18 before falling back below two days later.
It is now battling it out over over the 200MA ahead of this evening’s daily candle close, with a breakout being confirmed if it closes back above $181.25.
However, it’s worth noting that a rejection from the 200MA could lead towards a transition into a bearish phase in the market, with targets emerging at $151.89 and $133.59.
It’s been a typically volatile year for Ethereum and the entire cryptocurrency asset class. ETH is 33.57% up against its USD trading pair since the turn of the year despite being 41.96% down from its February high of $290.
Forecasts for the remainder of the year remain uncertain due to the amount of factors affecting price action, particularly the impact of Coronavirus and the Bitcoin halving.
Reports from the UK claim that the peak of coronavirus’ first wave is effectively over, which could cause a market recovery as people begin to go back to work.
The Bitcoin halving is also thought to have a bullish impact on price action as it will cause a reduction in supply, a stark contrast to what is happening with oil where a lack of demand has driven supply to unsustainable levels.
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Ethereum was launched by Vitalik Buterin on July 30 2015. He was a researcher and programmer working on Bitcoin Magazine and he initially wrote a whitepaper in 2013 describing Ethereum.
Buterin had proposed that Bitcoin needed a scripting language. He decided to develop a new platform with a more general scripting language when he couldn’t get buy-in to his proposal.
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Author: Oliver Knight
April 21, 2020
Has Zilliqa Built a Better Ethereum Yet?
- Zilliqa has made a strategy of following Ethereum and adding improvements like scalability.
- Since CryptoKitties, the Zilliqa team has been working to right DeFi’s uncertain future.
- Unfortunately, the ZIL token hasn’t enjoyed the same value as it’s counterpart, ETH.
Zilliqa, a smart contracts platform, has been following Ethereum’s missteps every since CryptoKitties brought the number two network to a halt in 2017. Now, with DeFi’s future in question, can Zilliqa pick up the slack?
More than three years ago, various blockchain networks ran into scalability bottlenecks. This meant that confirming transactions took much longer and became much more expensive.
Etheruem was not excluded from these discussions either. Part of the network’s attraction is its flexibility.
Where Bitcoin could only transfer digital value, developers could build whole games on Ethereum. Notable winners from this experimentation have been CryptoKitties and Ethermon, a Pokémon-like game.
Both games used blockchain technology to bring scarcity to each digital world. Each CryptoKitty or Ethermon that a user held could be verified as exclusive and irreproducible. Unfortunately, managing complex gameplay, such as battles and quests, became too taxing for the network.
This limitation was less an issue for CryptoKitties as it was simple back and forth transactions between collectors that dominated the blockchain. Ethermon’s troubles, however, became so cumbersome that the developers moved gameplay onto a temporary, centralized server. The collectible creatures continued to be stored on Ethereum, however.
Shortly after this move, the team then announced that they would be working with the then-unreleased Zilliqa blockchain. They wrote in July 2018:
“The higher throughput and low gas of Zilliqa’s sharding solution offer players [a] better experience.”
The excitement around Ethermon has since died down, however, with volume over the last 24 hours making up a meager $386, according to DappRadar.
This event would mark an essential strategy for the Zilliqa team and has meant keeping a close eye on Ethereum.
In the latest developments, the Singapore-based team may have a few ideas for improving the DeFi movement too.
Amrit Kumar, the president and Chief Scientific Officer of Zilliqa, told Crypto Briefing that Ethereum’s vision of decentralization is “too pure, and very ideological.”
“You can’t have pure decentralization,” said Kumar. “That doesn’t mean [decentralization] doesn’t have merit, but we need to bridge the gap with traditional finance.”
This stance is, in part, how the Zilliqa team is taking on DeFi. From stablecoins to decentralized exchanges (DEXes), Kumar wants to bring just a bit of centralization to experiments on distributed ledgers. “We need to mix, not all activity can happen on blockchains,” said Kumar.
And as the project is based primarily in SouthEast Asia, cracking DeFi would have real-world implications.
According to The Business Times, the region is both one of the fastest-growing and most limited markets in the financial services it offers. Roughly 70% of the population is either “underbanked” or has no access to such services. This statistic extends to small- and medium-sized businesses too.
Thus, businesses working to solve these issues are in high demand. They just need to make sure regulators are on the same page.
A partnership with Y Combinator-backed Xfers, a peer-to-peer payments platform, will see the regulation aspect resolved as well as another building block for DeFi.
In January 2019, Xfers earned coveted approval from the Monetary Authority of Singapore (MAS). This approval laid down the groundwork as it turned Xfers’ wallet into the first regulated product on the market. “This approval gives us full access to banks, institutions, and other members of the financial ecosystem,” said Kumar.
The next step has been to introduce a stablecoin.
Via the StraitsX initiative, Xfers and Zilliqa are rolling out XSGD; a cryptocurrency pegged to the Singapore Dollar. Despite the latest regulatory scrutiny around stablecoins from central banks, these products are critical for building out DeFi infrastructure. “You need a stablecoin,” said Kumar. “Without it, DeFi doesn’t work.”
It is sentiments like these that add further weight to the trials facing MakerDAO and its native stablecoin, Dai. So many DeFi projects leverage the stablecoin, its demise would disrupt the entire ecosystem.
The stablecoin also lays the groundwork for the rise of a DEX. In yet another cross-party collaboration, Zilliqa has tapped Switcheo, a NEO-based project, to build out the team’s non-custodial exchange. The DEX will allegedly resemble Uniswap, another Ethereum-based DeFi starling.
Beyond scalability and decentralized finance moves, the team is also working with the privacy project, Incognito. Like Ethereum’s Aztec protocol, users can deposit ZIL tokens on Incognito’s sidechain, and pZIL tokens are minted after.
Concluding, Zilliqa has been following in near lockstep with Ethereum.
Not just that, but they’ve been improving on the slight missteps from the number two blockchain. From scalability bottlenecks to stablecoin woes and privacy, Kumar and his team are working hard to achieve recognition.
The only question now is whether Ethereans will ever make the switch.
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Author: by Liam Kelly
This Macro Trend Signals Ethereum Will Soon Reach $40, Notes Analyst
- Ethereum has seen all of its recent upswings grow weaker throughout the past several months
- Underlying weakness amongst ETH buyers could be enough to lead the cryptocurrency to as low as $40-50 by the end of 2021
Ethereum, like Bitcoin and most other cryptocurrencies today, has further extended the downwards momentum that was first sparked yesterday when the crypto lost its recent momentum and declined from highs of $190.
This current weakness appears to be directly correlated to that of Bitcoin, and one analyst is noting that he anticipates ETH to ultimately decline to as low as $40-50 by the end of the year.
At the time of writing, Ethereum is trading down just under 2% at its current price of $179, marking a slight extension of the downwards momentum incurred yesterday.
This bear-favoring short-term trend came about after the crypto faced a firm rejection in the time following its rally up to $190, with the rejection here suggesting that bulls don’t currently have enough support to catalyze a sustainable uptrend.
This present weakness also comes as Bitcoin risks losing the support it has established around $7,000.
One analyst mused a highly bearish possibility in a recent tweet while looking towards Ethereum’s USD trading pair, explaining that each bounce has grown weaker throughout the past couple of years.
To him, this signals that ETH has yet to see its final capitulatory drop, which could lead the crypto to the $40-50 region by the end of the year.
“ETH / USD 1W TF – As is evident, every bounce is getting weaker. Nothing about this structure to suggest we have broken macro downtrend. I believe we will range for some time, we can make money shorting and longing but my long term Ethereum target is $40-$50 by EOY,” he stated.
The same trader also offered some thoughts on Ethereum’s short-term technical situation while pointing to its 3-day chart, explaining that he believes the ideal path to a long-term bottom will come about after a rejection at a key trendline sparks a decline to $40.
“ETH / USD 3D TF – This is the kind of price action I would want to see before calling a true bottom, until then the bigger picture is still bearish,” he said while pointing to the chart seen below.
This potential plunge lower likely won’t happen independently of the aggregated crypto market and may be perpetuated by Bitcoin seeing weakness in the months ahead.
Featured image from Unsplash.