Bitcoin rose above $9,000 over the weekend, taking cumulative year-to-date gains to more than 150 percent.
The leading cryptocurrency by market value clocked a 13-month high of $9,391 on Bitstamp on Sunday and was last seen trading at $9,200, representing 22 percent gains on last Monday’s low of $7,524.
Cryptocurrency market experts and investors are associating the sharp price gains seen over the last six days with a number of factors, the most prominent being Facebook’s coming foray into cryptocurrencies.
The social media giant is set to unveil its very own stablecoin, reportedly called GlobalCoin on Tuesday, June 17, with a launch to follow in 2020.
The project has reportedly already secured the backing of over a dozen companies and is seen boosting the pace of widespread cryptocurrency adoption by many including Barry Silbert, the founder and chief executive of Digital Currency Group.
Meanwhile, Spencer Bogart, General Partner at Blockchain Capital, believes Facebook’s crypto effort is among the most bullish external tailwinds for bitcoin in 2019/2020, as it will ease the friction in acquiring digital assets by creating a circular economy.
Further, there is a consensus in the investor community that Facebook’s crypto will create awareness that a private, non-central bank issued currency can exist, leading to increased adoption of bitcoin and other cryptocurrencies.
The hype garnered by GlobalCoin likely put a bid under the cryptocurrency over the weekend. That, however, makes BTC vulnerable to “sell the fact” trading following the expected white paper launch on Tuesday.
The announcement led to a sharp sell-off in Binance’s very own native asset, Binance Coin (BNB). The price of BNB fell 12.8 percent to 25,209 satoshis (a satoshi being 0.00000001 of a BTC) on Friday, and hit a one-month low of 34,906 satoshis on Sunday.
The slide indicates that investors have rotated money out of BNB and possibly into bitcoin, pushing the top cryptocurrency higher, as discussed by Alex Kruger – a prominent Fundamental & Technical Analyst.
The upcoming litecoin (LTC) halving, set to trigger on August 5, 2019, will cut the reward gained from mining the cryptocurrency by half, meaning LTC will become a more scarce asset overall.
”Halvings’ as they are known, typically result in an overall boost in value for the crypto markets, as the assets themselves become harder to obtain and therefore increase in value.
Litecoin has already rallied 353 percent this year and may have added fuel to the ongoing bitcoin’s price rally. It is worth noting that litecoin led the broader markets higher in the first quarter, with 100 percent gains over the period.
As noted earlier, bitcoin may see a pullback following Facebook’s announcement on Tuesday. The long duration charts, however, indicate that corrections, if any, could be short-lived.
Bitcoin jumped 17.57 percent last week (above left), invalidating the bearish view put forward by the previous week’s close below $8,000.
Further, the 5- and 10-week moving averages are trending north, indicating a bullish setup, while Chaikin money flow is reporting the strongest buying pressure since December with an above-0.32 reading.
The bullish case looks stronger if we take into account the falling channel breakout on the monthly chart (above right).
As a result, BTC could rise to $10,000 over the next few weeks. In the short-term, a price pullback cannot be ruled out.
BTC printed 13-month highs above $9,300 on Sunday but failed to close above $9,097 – the high of the bearish outside reversal candle created on May 30.
Another failure to secure a UTC close above $9,097 may trigger profit taking on long positions, leading to a price pullback to the 200-hour moving average (MA), currently at $8,300.
The price of bitcoin (BTC) hit a 13-month high above $9,300 on Sunday.
The leading cryptocurrency by market capitalization rose to $9,381 at 05:55 UTC – the highest price since May 10, 2018, according to CoinDesk’s Bitcoin Price Index.
BTC was last seen trading at $9,250 representing 6.4 percent gains on the day. On a month-to-date basis, the cryptocurrency is up 8 percent.
More than $19 billion worth of bitcoin has been traded across cryptocurrency exchanges in the last 24 hours, according to Messari data. Meanwhile, major exchanges included in the calculation of Bitwise’s “real” bitcoin trading volume are currently reporting the 24-hour volume figure at $867,697,751.
With the price rise, Bitcoin’s dominance rate, or its share of the total cryptocurrency market, has ticked higher to 57.1 percent from lows near 55 percent see on Friday.
The bitcoin price rally is boding well for the broader market. At press time, litecoin is up 2.3 percent on a 24-hour basis. Names like ethereum’s ether token, XRP and bitcoin cash are up 4 percent, according to CoinMarketCap.
Meanwhile, EOS is the best performing top 10 cryptocurrency of the past 24 hours with 7 .4 percent gains.
However, on a seven-day basis, litecoin is leading the top 10 cryptocurrencies with 18.29 percent gains followed by bitcoin, which has appreciated by 17.20 percent.
Looking forward, BTC may rise further toward the next major resistance at $10,000, as long-term technical studies are biased bullish. For instance, bitcoin’s 50- and 100-candle moving averages on the three-day chart look set to produce a bullish crossover – a sign of bull market momentum. Back in October 2015, the same cross marked the start of a long-term bull market.
Notably, with a move to 13-month highs, the cryptocurrency has retraced nearly 38.2 percent of the sell-off from December 2017 highs to December 2018 lows, as seen in the chart below.
BTC’s sharp rise from $7,500 to levels above $9,300 has invalidated the bearish doji reversal confirmed by last Sunday’s UTC close below $8,000. As a result, the path of least resistance is to the higher side and prices could cross the 38.2 percent Fibonacci retracement hurdle of $9,442.
However, a minor pullback to $8,000 could be seen before a break above $9,442, as the bearish divergence of daily trading volumes discussed on Friday is still valid. Further, the widely tracked relative strength index is reporting overbought conditions with an above-70 print on the hourly and 4-hour charts.
After revealing that his payments firm Square is building a small team to help with bitcoin and cryptocurrency development back in March, CEO Jack Dorsey has revealed more details about the project – even though it’s still early days.
In an interview with The Next Web, Dorsey, who is also CEO of Twitter, confirmed that he’d recently hired former Google director Steve Lee to lead the team. Dorsey said that he’d interviewed “tens of candidates” for the post before arriving at Lee as his choice.
The new hire will take responsibility for building the remainder of the team, as well as defining its future path, he said. Square is currently eyeing a maximum of five engineers and one designer, who will likely work on a single project rather than many.
That’s because Dorsey aims to “make some step changes to various aspects of the ecosystem, versus an iteration,” he said.
While one would expect devs, the choice of a designer comes as something of a surprise in such a early stage project. Dorsey put this down to the need for the need to make cryptocurrencies more accessible, as well as providing education on the technology.
Joking that the team doesn’t want any “jerks,” Dorsey also said that it’s important any candidates must have good technical abilities.
“We want to see significant open-source contributions to various projects. Bitcoin Core is a great example of that, but there’s others, too,” he said.
As for its particular role in the crypto ecosystem, he explained that Square Crypto might conduct “grungy, but meaningful” code reviews in order to speed up development. While there are plenty of devs helping out on cryptocurrency projects, few are working on checking the correctness of the code, Dorsey said – changing that could give a “huge boost” to the space.
Outside that, there’s need for work to improve efficiency and security. “There’s still a number of big flaws within the Bitcoin community right now,” Dorsey told TNW.
The CEO also indicated that he wants to keep the role of Square in the mechanics of the team to a minimum, ruling out cheap stock options in favor of optional bitcoin salaries in order to build a desire to better “serve the community.”
The work carried out by the team should also be open to the public. While it’s not set in stone yet, Dorsey suggested Square Crypto could operate like a traditional open-source project.
Aside from the more general development work of the crypto team, Square is eyeing bitcoin technology in its products too. Back in February, Dorsey announced during an interview with podcaster Stephan Livera that there are plans to integrate the lightning network – a still early-stage bitcoin payments tech – with Square’s Cash app.
Bitcoin (BTC) is lacking a clear directional bias for the eighth consecutive day amid a continued rally in litecoin’s (LTC) price.
The price of a single bitcoin – the world’s leading cryptocurrency market value – has been restricted to a $600 range since June 5. While any drops to $7,500 have been consistently short-lived, buyers have also repeatedly failed to engineer a convincing break above $8,100.
As of writing, BTC is changing hands at $8,000 on Bitstamp, representing a 0.5-percent gain on a 24-hour basis.
With BTC so indecisive, major alternative cryptocurrencies like ethereum’s ether token, XRP, bitcoin cash and EOS are also struggling for clear direction.
Litecoin, however, is flashing 6.5 percent gains on a 24-hour basis, according to CoinMarketCap. The fourth largest cryptocurrency by market capitalization rose to $141 on Bitstamp earlier today, the highest level since May 2018.
More notably, at the current price of $136, LTC is up nearly 40 percent from lows below $100 seen just seven days ago. Meanwhile, BTC is up 4 percent on a weekly basis.
As seen above, BTC has created a sideways channel inside a falling channel, so a break above $8,063 would confirm two channel breakouts and open the doors to $8,500.
It is worth noting that the breakout could be short-lived if trading volumes continue to remain low.
On the downside, the higher low of $7,713 is the immediate support. A violation there would expose the lower edge of the sideways channel, currently at $7,500.
Litecoin’s relative strength index is reporting a symmetrical triangle breakout – a bullish continuation pattern.
The 5- and 10-candle averages continue to trend north, indicating a bullish setup.
Further, LTC has consistently seen higher volumes on days of positive price action compared to days of negative price action. Therefore, the path of least resistance looks to be to the higher side.
That said, a pullback to the 5-candle MA support, currently located at $122, could be seen before further gains, as the cryptocurrency has rallied 118 percent in the last 6 weeks and the bulls often take a breather following such stellar rallies.
Michael J. Casey is the chairman of CoinDesk’s advisory board and a senior advisor for blockchain research at MIT’s Digital Currency Initiative.
The following article originally appeared in CoinDesk Weekly, a custom-curated newsletter delivered every Sunday exclusively to our subscribers.
Advances in cryptography are converging to help developers bring blockchain applications closer to the core decentralizing principles on which this technology is founded.
Inventions such as atomic swaps, zk-SNARKS and Lightning-based smart contracts are allowing developers to realize the dream of true peer-to-peer transactions in which neither party, nor an outside intermediary, can act maliciously. Witness the rising number of non-custodial and decentralized exchange (DEX) services for trading crypto assets.
This is exciting. But it also shines a light on another big problem that has curtailed the widespread adoption of cryptocurrency and blockchain technology: secure key management.
For too long, the most reliable means of protecting the private keys that afford the holder control over an underlying crypto asset have been too clunky, insufficiently versatile, or difficult to implement on scale. User experience has been sacrificed in return for security.
Now, some big strides in another hugely important field of cryptography – secure multiparty computation, or MPC – point to a potential Holy Grail situation of both usability and security in a decentralized system.
Progress in this field was marked last week by Tel Aviv-based KZen’s public announcement of the specs for its new ZenGo wallet. ZenGo uses MPC, along with other sophisticated cryptographic tools such as zero-knowledge proofs and threshold cryptography, to share signing responsibility for a particular cryptocurrency address among a group of otherwise non-trusting entities.
The beauty of the KZen model is that security is no longer a function of one or more entities maintaining total control over a distinct private key of their own – the core point of vulnerability in cryptocurrency management until now. Instead the key is collectively derived from individual fragments which are separately generated by multiple, non-trusting computers.
The model draws on the genius of MPC cryptography.
With this approach, multiple non-trusting computers can each conduct computation on their own unique fragments of a larger data set to collectively produce a desired common outcome without any one node knowing the details of the others’ fragments.
The private key that executes the transaction is thus a collectively generated value; at no point is a single, vulnerable computer responsible for an actual key. (KZen’s site includes a useful explainer on how it all works.)
KZen is not the only provider of MPC solutions for blockchain key management. Unbound, another Israeli company, is going after the enterprise marketplace with its MPC solutions for crypto security.
Unbound’s prolific (if blatantly pro-MPC) blog offers different angles on the same argument.
It makes a repeated case for why MPC is superior to the two preferred approaches to crypto security of the moment: hardware security modules (HSM), on which hardware wallets like Ledger and Trezor are built, and multi-signature (multisig) technologies, which are favored by exchanges.
If KZen and Unbound are to be believed, MPC solutions resolve both the hot-versus-cold trade-off in key management and the dilemma of self-versus-managed custody.
Cold wallets, in which keys are stored in an entirely offline environment out of attackers’ reach, are quite secure so long as they remain in that offline state. (Though you really don’t want to lose that piece of paper on which you printed out your private key.)
But bringing them into a transactable, online environment poses an overly cumbersome challenge when you want to use those keys to send money. That’s perhaps not a problem if you’re just a HODLer who transacts rarely but it’s a serious limitation to blockchain technology’s prospects for transforming overall global commerce.
On the other hand, hot wallets have, until now, been notoriously vulnerable.
Whether it’s the relentless “SIM jack” attacks on people’s phones that are emptying out both hosted (third-party custodial) wallets and on-phone self-custody holdings, retail participants’ horror stories are legion. And, of course, we all know the stories of custodial exchanges being hacked – from Japan, to Hong Kong, to Canada, to Malta.
At the same time, the solution that regulated institutional investors are currently seeking – that custodians and exchanges build Fort Knox-like “military-grade” custody solutions – inherently contain a compromise.
Not only does this approach fail to resolve the dependence on a third-party, but there are serious doubts about whether any such solution can be forever safe from hackers, who are constantly improving their methods for getting over firewalls. In best-case scenarios, the constant IT upgrades becomes a massive money suck.
None of this is not to say that existing security technologies are useless.
Ledger and Trezor’s hardware devices – a more nimble form of cold wallet – are widely used by individuals who are uncomfortable with both external third-party custody and online, on-device self-custody wallets. And, separately, multi-signature (multisig) solutions, in which an m-of-n quorum of keys are required to execute a transaction, have proven robust enough to be used by most exchanges.
But in both cases, vulnerabilities have been exposed. And to a large extent those risks come down to the fact that, regardless of the surrounding security model’s sophistication, the all-important keys are always sitting at single points of failure.
Just last week, researchers demonstrated how they could hack into a remote hardware security module. The irony: the researchers were from Ledger, which relies on HSM to secure its customers’ keys.
Multisig models arguably offer protections across such attacks, because a breach requires simultaneous control of more than one key held in separate locations, but the fact is that multisig solutions have also failed because of both technical and human vulnerabilities (inside jobs).
What’s more, both solutions are inherently limited by the need to customize them to particular specifications or ledgers. Crypto developer Christopher Allen pointed out last week , for example, that HSMs are particularly constrained by the fact that they are defined by government standards.
And in each case, the ledger-specific design of the underlying cryptography means there is no support for the kind of multi-asset wallets that will be needed in a decentralized interoperable world of cross-chain transactions.
By contrast, KZen is boasting that its key-less wallet will be a multi-ledger application from day one.
To be sure, MPC remains unproven in a practical sense.
For some time, the heavy resources needed to carry out these network computing functions made it a challenging, costly concept to bring into real-world environments. But rapid technical improvements in recent years have made this sophisticated technology a viable option for all kinds of distributed computing environments where trust is an issue.
And key management isn’t its only application for blockchains, either. MPC technology plays a vital role in MIT-founded startup Enigma’s work on “secret contracts” as part of its sweeping plan to build the “privacy layer for the decentralized web.”
(An aside: Enigma CEO and founder, Guy Zyskind, is also an Israeli. Israel has fostered a remarkable concentration of cryptographic expertise in this space.)
It would be unwise to assume that MPC, or any technology for that matter, will provide a perfect, totally infallible solution to security problems. It is always true that the biggest security threats come when human beings complacently believe security is not a threat.
However, if you squint hard enough, and think about how this technology’s prospects for better key management can be married to Enigma’s vision for an MPC-based secret contract layer and to the broader march toward decentralized, interoperable asset exchanges, a compelling vision of true peer-to-peer blockchain-based commerce starts to emerge.
At the very least, you need to watch this space.