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What the price of Bitcoin will do this weekend is anybodys guess, but heres one good bet: The past weeks tumult in banking will make it more costly to trade.

Since Silvergate Capital (ticker: SI) said it was winding down and Signature Bank (SBNY) failed, token prices on various trading platforms like Coinbase and Gemini have diverged widely. Traders have been paying hundreds of dollars, and sometimes more than $1,000, more for a single Bitcoin on one platform than on others.

The inefficiency in the crypto market appears to be at least in part the result of the debacles at the two banks. Each ran prominent payments networkscalled SEN and Signetthat allowed customers to send dollars to each other almost instantly at any time, seven days a week.

Thats important to crypto traders, who buy or sell tokens outside of banking hours and often need liquidity more quickly than the couple of days it can take to process a wire transfer. The ability to move money fast is also crucial for market makers who need to get dollars from one exchange to another to take advantage of price differences and potentially arbitrage them away.

Silvergate, which is in the process of closing its operations, has shut down SEN. Signet is still operating, but some customers have stopped using it given its uncertain future. Reuters reported that government regulators have said any buyer of Signature Bank will have to abandon its crypto business.

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Since most banks dont process transfers on weekends, it translates into pure inefficiency in the market, said Dave Weisberger, CEO of CoinRoutes, which provides market data to help traders decide where to buy or sell. We havent seen anything like this, frankly, for years.

Over the weekend, the difference between the prices of Bitcoin on most exchanges was about 0.1%, about 10 times as much as it usually is, according to CoinRoutes data. By Wednesday, the spread was three times as much as before, but Weisberger said it could increase again this weekend with banks closed.

That price difference might seem slight, but over time it adds up to a sort of shadow trading tax on investors. It is far greater than similar price discrepancies that regulators have tried to stamp out in the stock market, Weisberger says.

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For the trading platform run by Gemini, the dispersion was even wider, with traders paying nearly 2% more on average. At the height of the turbulence, a Bitcoin trader on Gemini was paying more than $1,000 more for a Bitcoin than traders on other platforms, Weisberger says.

A Gemini spokesperson didnt respond to a request for comment.

Traders could eventually find workarounds. For example, the difference in Bitcoins price on different exchanges when buying with the Tether stablecoinwhose value is pegged to the dollar and isnt transferred with bankshardly moved last weekend.

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Later this year, the Federal Reserve also plans to debut its own long-awaited 24-7 payments network, called FedNow, a service similar to what the banks provided that could solve the problem of moving money on weekends.

Crypto could also speed adoption of FedNow as it is a way for investors to fund and cash out of trades without having to leave cash or digital dollars on a trading platform, wrote TD Cowen analyst Jaret Seiberg in a research note this week.

Until then, Bitcoin traders might just consider taking the weekend off.

Write to Joe Light at joe.light@barrons.com

Continued here:

Avoid Buying Bitcoin on Weekends Now. It Could Save You Some Money. - Barron's

Cryptocurrencies stood out this week as bank shares tumbled and the global liquidity crisis rocked the stock market. For the week ending March 17, bitcoin finished higher by 34%, making it the cryptocurrency's best week since January 2021 which marked the start of the institution-led bull run that year. Coin Metrics measures a week in crypto, which trades 24 hours a day, from the stock market close one Friday to the next. Bitcoin is now up 62% for the year. BTC.CM= YTD mountain Bitcoin (BTC) in 2023 Ether ended the week higher by 23%. At one point it traded at about $1,780, a level not seen since its rally ahead of the Ethereum merge in September. Ether is up 45% year-to-date. "Crypto hasimpressedas an unexpected banking crisis has triggered a realization that Fed policy is very restrictive and that the economy is headed towards a recession," said Ed Moya, senior market analyst at Oanda."The Fed now has to decide if they have enough information about the escalating risks that are spreading across several banks. Inflation is heading lower, but some officials might want to deliver one more rate hike before pausing and that could trigger a de-risking moment on Wall Street." Bitcoin versus the banks The price of bitcoin twice rose above the key $25,200 level to more than $26,000, according to Coin Metrics. It hasn't seen that level since June, days before its pre-FTX bottom of about $18,000. BTC.CM= 1Y mountain Bitcoin, 1-year Bitcoin's outperformance amid a crisis in the traditional banking system had some wondering if the price rallied on a potential narrative shift. Though bitcoin was initially designed to be digital cash and an alternative financial system, it spent much of last year trading like a speculative asset. Last week, it even fell with risk markets and bank stocks amid the uncertainty surrounding Silvergate Bank. That shifted this week however, following the closures of Silicon Valley Bank and Signature Bank, giving the appearance that investors were trading it on its core value proposition, the ability to "be your own bank." "When the financial system shows cracks, it provides a use case for decentralization," said Callie Cox, U.S. investment strategist at eToro. "Of course, there are pros and cons to decentralized and centralized approaches, but for now, investors seem to be focusing on one specific angle." However, if the original bitcoin narrative began to click for people this week, it doesn't change the fact that macro themes are still the biggest driver of price. "In practice, bitcoin isn't isolated from the traditional banking system. Crypto prices rose quickly in 2020/2021 due to central bank monetary expansion, causing capital to move from the traditional fiat banking world to the crypto world," Sheena Shah, an analyst at Morgan Stanley, said in a note this week. "So our conclusion is that the Bitcoin network can operate without banks but that bitcoin's price, and thus its purchasing power, has been and continues to be influenced by fiat central bank policy and needs banks to facilitate flows into crypto." The week ahead Many agree the bitcoin price bottomed in late 2022 during the collapse of FTX, but so much uncertainty remains in the market and traders have been finding it difficult to identify what the start of a new bull run would look like. From a technical perspective, this week's close above $26,000 could be that signal, according to Yuya Hasegawa, an analyst at Japanese crypto firm Bitbank. Fairlead Strategies' Katie Stockton, however, is looking for two consecutive closes above $25,200 for the formation of a "bullish long-term development." Investors will continue to monitor the banking crisis and the regulatory landscape in the week ahead. On Tuesday the Federal Reserve will begin its two-day policy meeting. "Bitcoin's rally could remain in place if the Fed opts to end its tightening cycle and wait and see what happens next with banking turmoil," Moya said. "Traders are pricing in rate cuts this summer already, so we will see what happens if the Fed opts to remain focused on inflation and deliver another quarter-point rise. A pause and Bitcoin could have the potential to make a run towards the $30,000 level." Given the pulse of markets and recent Fed comments on inflation, Moya said one last hike should be the base case and that could bring bitcoin back to the middle of this month's trading range, he added.

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Bitcoin is up 60% so far this year as investors rediscover appeal as ... - CNBC

Bitcoin and other cryptocurrencies were higher Wednesday, paring their biggest gains from a Tuesday spike but still in the midst of the best winning streak for digital assets since the last bull market.

The price of Bitcoin has risen 2% over the past 24 hours to $24,800. The largest digital asset has faded from a $26,500 peak notched in recent tradingits highest level since the crypto crash accelerated last Junebut on Tuesday still capped its best four-day stretch since February 2021, according to Dow Jones Market Data. Ripping higher from below $20,000 as recently as last weekend, a return to the $25,000 zone should reassure traders that Bitcoin is looking bullish again. But it needs to consolidate gains.

The price seems to be developing a bearish pattern, indicating that a top may be in the works for the time being, said Naeem Aslam, chief investment officer at Zaye Capital Markets. Bulls, on the other hand, should rejoice since the price has broken above the $25,000 level, which was an important resistance zone, and a breach of this level has opened the way for the price to re-test its next resistance zone of $30,000.

Bitcoin has revealed just how closely tied crypto sentiment is to the macro picture, rallying in recent days in the face of what could be interpreted as dire headwinds for digital asset markets.

The two leading U.S. crypto banks, Silvergate Capital and Signature Bank, have both collapsed in the past week, boding ill for both token liquidity and sentiment for digital assets among regulators. While the bank failures could lead to negative impacts on market functioning, prices have still soared.

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Ironically, federal regulators closing down Signature Bank as well as Silicon Valley Bankwhich marked the biggest bank failure since the 2008-09 financial crisislit the spark for the latest crypto price spike. Pressure on banks has been an unintended consequence of the Federal Reserves dramatic interest-rate increases over the past yeara campaign to tame decades-high inflation with aggressive monetary policy.

Higher rates also dampen demand for risk-sensitive assets, like stocks and especially cryptos. The bank collapses, as well as encouraging inflation data on Tuesday, have pushed traders to shift their expectations for the Feds next move on interest rates, which is due following the March 21-22 meeting of its policy-setting committee. Bitcoins jump higher was essentially a more extreme expression of the sentiment that similarly drove the Dow Jones Industrial Average and S&P 500 higher.

Weve seen Bitcoin act as the leading risk-on asset for the last two years, said James Lavish, managing partner at Bitcoin Opportunity Fund. Investors believe that the Fed has taken a 50 basis-point hike off the table for next week, and at worst there will be a 25 basis-point hike, and perhaps no more hikes at all. Bitcoin was able to harness this sentiment and move to risk-on before all other assets.

Beyond Bitcoin, Ether the second-largest cryptoadvanced 2% to $1,700. Smaller cryptos or altcoins were also in the green, with Cardano up 1% and Polygon popping 6%. Memecoins were also gaining, with Dogecoin climbing 5% and Shiba Inu

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Write to Jack Denton at jack.denton@barrons.com

Read more from the original source:

Bitcoin Price on Its Best Winning Streak Since Last Bull Market. What's Next. - Barron's

Bitcoin (BTC) accounts for more of the total value of all cryptocurrencies than at any time since June 2022.

In the latest knock-on effect from this weeks surge above $26,000,data from TradingView shows that Bitcoin market cap dominance is nearing 46% its highest in nine months.

Up almost 3% since the weekend alone, Bitcoin dominance shows a trend-setting move by the largest crypto asset reminiscent of classic bull cycles.

Every Bitcoin bull market has commenced with a spike in BTC dominance (as has every bear market), markets commentator Tedtalksmacro noted on March 15.

An accompanying chart showed that such dominance spikes tend to precede significant trend shifts in BTC price action.

Bull Market or Echo Bubble? Tedtalksmacro queried.

Analyst Hamza meanwhile used Wyckoff schematics to reveal an equally broad surge in dominance after months of an accumulation phase.

Expect for Bitcoin dominance to come roaring back soon, optimistic Bitcoin investor and research analyst Tuur Demeester added earlier in the week.

With recent events further buoying Bitcoin bulls after an already impressive start to the year, overall opinions on future performance are gradually flipping positive after a grim bear market.

Related:Bitcoin returns to $25K as Credit Suisse bailout precedes EU rate hike move

Among the shifts in perspective is that of trading firm DecenTrader, whichdescribed the narrative around Bitcoin as turning bullish in a fresh market update on March 16

It has been a long, cold winter for Bitcoin and crypto. However, recent events have helped to catapult near-term price, and importantly have shifted the narrative from bearish to bullish, contributor Miffy summarized.

Of particular interest is $21,800, should a retracement kick in, with DecenTrader eyeing $30,000 as a potential upside target.

In the near-term the shorts have been squeezed, late-longs punished, and right now price is resting underneath the 200WMA. If price does need to drop down to generate enough momentum to take the next leg up to $30,000, the 1D support at $21,800 is a clear target. But for now 4H support is holding well at $23,900, Miffy concluded.

BTC/USD traded at around $24,900 at the time of writing, according to data from Cointelegraph Markets Pro and TradingView.

The views, thoughts and opinions expressed here are the authors alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.

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Bitcoin dominance nears 50% as research hails bullish narrative flip - Cointelegraph

Dadaab refugee complex, in Kenya, on April 16, 2018. Kenya is one of the African nations where bitcoin users are now using mobile phones to transact over the Lightning Network, even without internet. (Photo by YASUYOSHI CHIBA/AFP via Getty Images)AFP via Getty Images

Theres a growing population of Africans without reliable internet access that are still using bitcoin for peer-to-peer transactions thanks to a solution called Machankura .

In 2022, South African software developer Kgothatso Ngako built a tool, Machankura, for accessing bitcoin despite the continents mobile internet connectivity challenge. It offers a way to access the Lightning Network through an Unstructured Supplementary Service Data interface, utilizing mobile phones Subscriber Identity Module telecommunication network. USSD is similar to Interactive Voice Response.

You usually listen to an IVR program when you call a mobile network operators customer service. It tells you which numbers to press for the service you want to access. USSD is kind of like IVR but in textual form. Machankura is already being used by roughly 2,900 African users across more than seven countries, including Nigeria, Kenya, Ghana, Uganda and Namibia, Ngako told me. Despite the rapidly growing tech industry on the continent, internet penetration across Africa still has a long way to go.

The silver lining here is that the situation presents a unique opportunity for Africans to build tools for rural and developing areas that havent been explored elsewhere. Other offline bitcoin solutions, such as Locha Mesh in Venezuela, rely on mesh networks to bounce the message from device to device until it reaches a device with internet connectivity. That only works if other people within a few miles of the sender are also operating a mesh network device. In contrast, the unique context in Africa offers a business advantage for technologists looking to reach the 2.9 billion people that the International Telecommunications Union estimates still lack reliable internet access.

The USSD protocol, a communications layer for mobile telecommunication networks that is often compared to SMS, gives software developers a lot of under-hyped flexibility. The USSD protocol allows forwarding request to online applications that bitcoin users can tap into by dialing a code like *483*8333# in Kenya, for example, to interact with the Machankura app even if the phone doesnt have internet connectivity. Here is a demo of a payment on Machankura:

Actions on Machankura can even be more complex than a simple send, receive, or check balance. You can barter BTC, which involves selling your BTC for goods and services on Bitrefill.

Machankura itself offers a Lightning-friendly bitcoin wallet, so users can send to a wallet associated with a user name or phone number or choose to send to any other Lightning wallet using a Lightning address. If all goes well, the user receives a screen message detailing that the payment was successful and showing the Lightning address that received the funds.

Despite the Machankura project being early, the growing popularity of this product shows the bitcoin economy can incorporate low-income populations without reliable internet access. Femi Longe, program director at the educational initiative Qala Africa told me that Africans need to think about bitcoin in their context and how it could be used to solve the problems that they face. Projects like Machankura illustrate how bitcoin can be used in such an African-centric context.

If the global south is going to lead bitcoin adoption, as so many industry experts claim, then I also believe that African users and developers will lead innovation at the bitcoin application level.

Africans are not only consumers of emerging technology. We are also producers and inventors. Although there is a growing number of internet startups on the continent, internet penetration of the continent still remains very low. In 2020, the World Bank estimated that only 29% of the population of Sub-Saharan Africa routinely used the internet. This inspires technologists to build for customers who dont have internet connectivity.

On the other hand, phone usage is widespread. GSMA (Groupe Speciale Mobile Association) data from 2018 indicated that 74% of sub-Saharan Africans used SIM cards, estimating that number will rise to 84% by 2025. In short, a significant number of the people in Africa are using phones without internet connectivity, like the Motorolla C113 or feature phones like the Nokia 3310.

To make Lightning payments over USSD reliable, secure and censorship resistant, Machankura will need to overcome several challenges. These challenges include the fact that USSD does not use encrypted messages, so this communication could easily be intercepted by a third party and is not ideal for situations that require privacy. According to Kgothatso, they are already working on ways to introduce encryption on the service in order to mitigate this challenge.

Secondly, the Machankura USSD service is currently custodial. Users dont own their keys, which means they could potentially lose their funds. When it comes to bitcoin the rule is not your keys, not your coins.

One option might be for apps to use a SIM card like a Lighting signer that allows users to backup their wallets. The issue here is that current phone SIM cards are not easily programmable. To solve the programmability issue, the team behind Machankura is currently experimenting with programming SIM overlays as Lightning signers. In addition, every USSD request to the Machankura application, is forwarded to Machankuras servers by a third party (a mobile network operator or a USSD gateway service like Africas Talking). These are all centralized platforms that could potentially be forced by the government to take down Machankura or to cancel the service.

To solve this issue, the Machankura team told me they are thinking about potentially hosting the service as a mobile virtual network operator. And, last but not the least, using an app hosted on specific mobile network operators means that the service is limited to certain countries where the mobile operators network is available. Therefore, scaling the service means integrating with mobile network operators in every new country or using a gateway like Africas Talking to ease the process.

Theres still a long way to go until offline bitcoin solutions are borderless like the bitcoin network itself. Personally, I would love to see simple phone apps offering more easy onboarding that allows people to buy bitcoin, not just send or receive bitcoin someone already owns, directly from the services USSD screen. These could leverage mobile money services that are already accessible via USSD. And, of course, I hope that future iterations make such services non-custodial. All things considered, I believe we will continue to see more innovations using bitcoin that are unique to the global south in the coming years. African bitcoiners are only getting started.

Im a Cameroonian software developer and Melton Foundation fellow focused on open source contributions to the Bitcoin Dev Kit, funded by Btrust. I graduated from Ashesi University College with a degree in computer science and am also a former contributor to Auth0, a web identity provider which helps developers easily integrate authentication and authorization in their apps. Im now based in Kenya, where Im the co-host of the Nairobi BitDevs technical meetup.

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How Africans Are Using Bitcoin Without Internet Access - Forbes