August 28 Bitfinex Alpha | Bitcoin mining difficulty and high hashrate amid a quiet market
In Bitfinex Alpha
Bitcoin's belly is worrying! Despite the flagship cryptocurrency trading at a dim price of $26,000, mining difficulty has skyrocketed, reaching an impressive peak of 55.62 trillion hashes. This breakthrough is not just a technological oddity; It symbolizes Bitcoin's innate resilience and future appeal. Meanwhile, the hash rate of digital gold has been quite impressive, rising more than 60 percent since the beginning of the year. If that wasn't enough, a staggering 40% of Bitcoin's supply has been dormant for over three years – a testament to long-term believers. However, for those looking for tremors before the quake, the one-year inactive supply seems to reflect Bitcoin price movements with eerie accuracy. While Bitcoin's recent turmoil suggests stormy seas ahead, fundamental metrics tell the story of a market filled with nuance, anticipation, and undying faith. Next chapter? Only time will tell.
Meanwhile, when we look at globally interconnected markets, the S&P 500 shows resilience, signaling either the dawn of a market rally or the darker shadow of a decline. Powell's comments in Jackson Hole put the market on alert, raising speculation about the US Federal Reserve's next move. Meanwhile, China, reeling from the aftershocks of Evergrande's bankruptcy filing, is seeing its stock market slide to a historic low against US indices, reminiscent of the 2001 split. China, coupled with the strategic reduction of interest rates by the central bank, has thrown into turbulent waters awaiting the second largest economy in the world. But as China navigates this storm, global markets are, for now, watching silently from shore.
On the macro side, the US economic landscape represents a complex tapestry of challenges and opportunities, with slowing growth, a divided housing market, mixed business indicators, shifting consumer sentiment, and the Federal Reserve's strategic stance, all converging amid a backdrop of uncertainty.
The latest S&P Global report reveals that the services sector, an important economic engine, saw a contraction in demand for new business, overshadowing sluggish growth in August.
In the US housing market, existing home sales are challenged by mortgage rates and limited inventory, leading to higher prices. On the other hand, new home sales are rising due to the scarcity of existing homes, coupled with falling prices and increased demand for new construction.
Meanwhile, corporate spending barely made gains in July, raising concerns about the investment side of the economy. In a development, new data on unemployment claims defied expectations of a decline to record levels in August, confirming the tightness of the labor market. These concerns are rooted in a fearful outlook for the economy's trajectory despite current positive trends driven by strong consumer spending and a resilient labor market.
The Fed Chairman's insights at the Jackson Hole symposium highlighted the central bank's strategy on interest rates and its assertive stance on taming inflation. Powell's speech appeared against the backdrop of a confusing economic landscape full of uncertainty.
In our news from the cryptocurrency space, the whirlwind continues. In a landmark ruling, China's anti-cryptocurrency campaign was dealt a major blow when a top Chinese official, Xiao Yi, received a life sentence for a stunning $329 million Bitcoin mining scam. Meanwhile, across the Atlantic, former New Jersey corrections officer John DiSalvo is playing the pied piper, as he allegedly conned more than 200 first responders with a “crypto pension” scam, pocketing a cool $620,000. Not to be outdone, leading exchange Bitstamp halted Ethereum staking for US clients, echoing the moves of Kraken and Coinbase, all dancing to the tune of the SEC's tightening. Amid this storm, DeFi titan Balancer Labs discovered a vulnerability in its V2 pools, sending ripples across the cryptocurrency lake. As the cryptocurrency saga unfolds, vigilance and intelligence remain the order of the day.
Happy trading!
