English
73285
|
The cryptocurrency circle can be described as a "chicken and dog rising to the sky" - Bitcoin originally dominated the rise and fall of the currency circle, but now it has become mixed. Dogecoin (DOGE) has surged nearly 400% in the past week due to Musk’s strong push. ； “Ethereum (ETH), the second largest player in the currency circle, has begun to challenge Bitcoin's big brother status. Bitcoin (BTC) has fallen 27.5% since mid-April, while Ethereum has rebounded by about 15% during the same period. Bitcoin has been in its 12th year, and its market value has reached more than 1 trillion US dollars. It is no longer a "diaosi currency", but a "rich, rich and handsome" that is constantly being accepted by traditional financial institutions. The possibility of continuing to increase a thousand times is slim.  So under the liquidity frenzy, speculators began to look for the next "hope coin" and dreamed of making a thousand times profit. Recently, on the Reddit forum, the home base of the "Bloodbath Wall Street" movement, some grassroots American young people shared their "results" in purchasing Dogecoin. It is worth noting that Dogecoin has experienced a cumulative increase of up to 14,000% this year, or a surge of 140 times, far outperforming other cryptocurrencies such as Bitcoin, becoming one of the digital assets with the largest appreciation this year. “In view of the continuous decline in the market value of Bitcoin, the industry is speculating whether Ethereum is expected to take over Bitcoin and carry the market banner. However, Bitcoin can be regarded as the 'Moutai' in the cryptocurrency market, and its dominant position is difficult to shake. The cryptocurrency market is currently in a bull market, so various altcoins have generally risen, which has lowered Bitcoin's market share. In the future, when the market enters a bear market, Bitcoin's market share will increase. ”William, chief researcher of OKEx Research Institute, told China Business News. Dogecoin’s Counterattack “My name is Glauber Contessoto, I am 33 years old. I first came into contact with Dogecoin on Reddit. On February 5 this year, I took out almost all my savings and invested more than $180,000 in Dogecoin, which was priced at about 4.5 cents at the time. I grew up poor so this was a big deal to me. I usually work in a music company in Los Angeles and have no extra disposable income to invest in Dogecoin, so I took a big risk this time. Not only did I use all my savings, I also borrowed money through the app for margin investment. About 2 months later, on the evening of April 15, the price of Dogecoin soared, rising 400% in a week. ”the investor posted excitedly on the forum. By April 16, according to CoinGecko data, the market value of Dogecoin had reached $49 billion, eventually hitting a record high of about 45 cents. “My Dogecoin investment has grown to $1 million. In my excitement, I posted a post on Reddit. ”the investor mentioned. This myth of overnight wealth and grassroots turnaround has sent the entire cryptocurrency market into a frenzy. Even among middle-aged and elderly people, Dogecoin has recently become a talk after dinner. For ordinary investment novices, Bitcoin is already out of reach. Just imagine, if Bitcoin rises another 10 times, it means that the market value will reach more than 10 trillion US dollars, the annual GDP of the United States will be more than 20 trillion US dollars, and the entire US stock market valuation will be more than 40 trillion US dollars. Dogecoin is characterized by its low valuation. The original valuation was less than US$1 billion. It has soared under the strong promotion of Tesla founder Musk. Musk tweeted on his personal Twitter with more than 50 million fans, and the valuation of Dogecoin instantly soared to US$4 billion. Then Musk continued to bring goods, and Dogecoin’s valuation stood at US$80 billion. Morgan Stanley once described the rise of Bitcoin in this way - Bitcoin has achieved the fastest appreciation in history, surpassing all dazzling myths of wealth creation: such as gold (1970s), Japanese stock market (1980s), technology stocks (1990s), Chinese stock market (2000s), commodities (2000s) and FANG stocks (2010s). Naturally, grassroots investors also expect Dogecoin to become the next Bitcoin. “Cryptocurrencies like "chickens and dogs ascend to heaven" emerge one after another. On May 8, the price of the previously unknown Shib coin soared by more than 251%, with a trading volume of 40.3 billion yuan, and it became a hot search on Weibo. Shiba Inu Coin is even more popular than Dogecoin.  Ethereum challenges Bitcoin Ethereum has been considered the second player after Bitcoin since its debut, and now it is challenging its "big brother". Following a strong rebound in the first quarter of 2021, Bitcoin has fallen by 27.5% since mid-April, while Ethereum has simultaneously rebounded by about 15%. The ratio of Ethereum to Bitcoin is constantly rising, and traders' focus has therefore shifted to Ethereum. Ethereum prices have hit record highs over the past few days. OKEx market data shows that Ethereum hit $3,548.41 on May 6, an increase of nearly 30% from the lowest point on May 1 ($2,732). Since the beginning of the year, Ethereum’s highest increase has reached 389%. In terms of market capitalization performance, Ethereum also has its moment of glory. AssetDash data shows that Ethereum’s current market value is approximately US$402.3 billion, ranking 17th on the global asset market value list, surpassing Walmart and approaching Samsung and Johnson & Johnson. Regarding the reasons for the strong rise of Ethereum, William told China Business News that there are two main reasons. First of all, blockchain networks are different from ordinary networks. On ordinary networks, most of the value will be concentrated in the application layer (such as Amazon, Facebook), but it is difficult to capture value in the network protocol layer (such as TCP/IP protocol) ； Most of the value of the blockchain network is concentrated in the network protocol layer (such as the Ethereum network), and a small part of the value is distributed in the application layer (distributed applications). The main reason is that the encrypted digital currency Ethereum (ETH) issued by the blockchain network protocol layer is the basis for the normal operation of all distributed applications (as Gas fuel fee, collateral, investment and financing). Taking the previously popular distributed finance as an example, 90% of DeFi is currently concentrated on the Ethereum network. Since the explosion of DeFi applications in June last year, the lock-up value of DeFi protocols (the amount of ETH locked up) has grown exponentially. The prosperity of DeFi has directly driven the market demand for ETH and pushed up the price of ETH. Secondly, Canada’s Toronto Stock Exchange launched three Ethereum ETFs at the end of April, providing investors in the traditional financial market with a compliant channel for capital entry.； There is also news that the European Investment Bank will issue digital bonds on Ethereum ； These news are directly beneficial to the increase in the price of ETH. Looking at the entire crypto market, the polarization of the market has become increasingly serious in recent days. On the one hand, Ethereum, Dogecoin, ETC, BCH, etc. have experienced amazing gains ； Bitcoin, on the other hand, continues to be volatile and its dominance over the crypto market appears to be waning. One of the driving forces is that many people who previously held Bitcoin began to sell out of Bitcoin and buy other cryptocurrencies including Ethereum and Dogecoin. Arbitrage trading between cryptocurrencies is increasingly becoming a popular trading strategy. Bitcoin may experience consolidation Under this pattern, institutions believe that Bitcoin may currently experience consolidation. “We can reasonably expect Bitcoin to share market focus with Ethereum for some time during the consolidation period. Taking this into account, we believe that Bitcoin started from the low in March 2020 and completed 5 waves of active upward trend at the high of 64895 on April 14. The decline from the high of $64,895 to last weekend's low of $47,555 is considered a three-wave 'ABC' correction. Looking forward to the market outlook, Bitcoin may start a new decline and test the support level of $40,000. ”Tony Sycamore, a senior analyst at Jiaqiang Group, told China Business News. In fact, in addition to arbitrage between cryptocurrencies, there is another important factor driving cryptocurrencies other than Bitcoin—money laundering. An underlying consensus is that cryptocurrencies provide the perfect “medium of value” for online and offline criminal activities and facilitate money laundering. If the stolen money received is Bitcoin, it already has strong anonymity. If the Bitcoin is exchanged for other currencies with good liquidity and large market capitalization, such as Ethereum, the source of the funds can be said to have completely disappeared. Faced with this situation, supervision is also in a dilemma. U.S. Securities and Exchange Commission (SEC) Chairman Gensler said on May 6, local time, that Congress must formulate a framework to supervise U.S. cryptocurrency exchanges to protect the rights and interests of investors. Gensler said that the SEC is currently working to promote protection of the cryptocurrency market and that transactions should require more direct supervision.  U.S. Treasury Secretary Yellen recently mentioned that there is currently a lack of regulatory framework for cryptocurrency. However, establishing this framework is also difficult because there are now more than 5,000 cryptocurrencies for which quotations can be found on the market, and more new coins are emerging one after another. Even if regulatory authorities are trying to kill Bitcoin and Ethereum, there are still other "alternative coins" emerging, and cryptocurrency exchanges are also emerging one after another. Therefore, regulatory agencies can only try to make existing mainstream currencies more transparent. The corresponding result may be that mainstream funds will continue to pour into "alternative coins". Elon Musk, who is regarded as the "promotion ambassador" of Dogecoin, posted a tweet on May 7. He tweeted: “Cryptocurrencies are promising, but please invest with caution. ”He also attached a video in which Musk was interviewed about Dogecoin and said that people should not invest their life savings in cryptocurrencies, it is unwise.  Restore the day of paralysis in west Beijing: A piece of plastic film caused a "tragedy" and tens of thousands of tourists were stranded |
|
|
|
|
|
