The ongoing crash in the cryptocurrency market witnessed a heavy amount of sell-offs across the market. Bitcoin and altcoins, both saw massive liquidations amounting to millions on a daily basis. Clearly, the digital assets market has been struggling to exit the death spiral fueled by inflation data and funds outflow.
But now, even stablecoins are facing the music as a few lost their peg with $1 under heavy selling pressure.
Not so stable anymore
Two stablecoins- TRX and BTC-backed stablecoin USDD and Neutrino USD, or USDN (backed by WAVES), at press time, continued to trend downwards, away from their $1 mark.
TRON’s newly launched stablecoin (USDD) may be running into trouble just months after launch. At press time, USDD suffered a fresh 0.8% correction as it traded around the $0.98 mark. The de-pegging of USDD has only added to the increasing sense of fear factor in crypto.
The sinking ship (TRON and the respective stablecoin) took the DeFi total value locked (TVL) to $63 billion. The lowest figure since April 2021. Talking about the latter, Neutrino USD (USDN), an algorithmic stablecoin that is part of the Waves blockchain ecosystem, fell beneath its U.S. dollar peg, trading to the lows of $0.96.
Following such developments, the affected parties took certain steps to inject some optimism within the bearish scenario.
Tron’s CEO Justin Sun explained that the Tron DAO which manages USDD is “actively buying crypto… We will add reserve into [the] public address once [the] market is stable. Furthermore, USDD return rate will refresh every day.”
In the past hour, Sun and TronDAO announced a further purchase of 650 million USDC bringing their total to $2.5 billion. Furthermore, Neutrion was looking to inject part of its collateral into the market to increase the valuation of the stablecoin.
Did it help the cause?
The de-pegging development showcased that investors are moving their funds toward different classes of assets, like derivatives. Even more, fear and speculations around stablecoins especially after the UST fiasco. Last month, UST-LUNA, an algorithmic coin like USDD, crashed and wiped $18 billion off the crypto market. This crash came after it struggled to maintain its UST to the dollar peg and fell to 35 cents on 9 May.
Similarly to this case, in March Do Kwon announced that Terra would purchase $10 billion of BTC to collateralize UST. The plan failed.
UST’s fall directly/indirectly affected millions of investors worldwide. Especially in South Korea. Hence, in a recent development, South Korea’s largest crypto exchange Upbit warned of possible risks to WAVES and TRON (TRX) due to USDN and USDD’s de-peg. The Terra incident caused heavy losses for South Korean investors. Consequently, exchanges became more cautious.
Ethereum investors should know this reasoning behind ETH’s crash in June
It has been hard for ETH traders to avoid panicking in the last few months as ETH continued to sell with no end in sight. The bears have been easing off their assault every once in a while, paving the way for minor relief rallies. However, even those have been short-lived and the bears continue to show their strength.
A similar scenario is taking place right now following ETH’s latest crash. The market has experienced a few days of relative calmness and some upside. Investors might, thus, expect ETH to experience another sell-off sometime soon if the market continues on the same trajectory. Understanding the key sources of the selling pressure is essential in order to gauge where the market might be headed.
It turns out exchange-traded funds (ETFs) holding large amounts of ETH have been selling off their holdings. 3iQ CoinShares Ether ETF (ETHQ.U) and Ether Fund (QETH.U) holdings are among the top ETFs that invested heavily in ETH in the past. Their Glassnode metrics reveal that they offloaded a significant amount of ETH in June.
The 3IQ Coinshares ETF offloaded roughly 82,886 Bitcoin between 1 June and 20 June. The Ether Fund ETF sold off roughly 87,385 ETH between 31 May and 20 June. Although these ETFs sold off large amounts of ETH, each of them holds more ETH than the amount they sold.
Catching the next wave
It is easily assumed that this means they will likely continue selling in the next few months given the amount they have left. However, the lower prices have been attracting heavy accumulation and strong growth in the number of users. ETH addresses holding more than 100 ETH have steadily increased in the last 12 months.
There were just over 42,000 addresses holding 100 ETH and above at the start of July 2021. That number grew to 44,343 addresses by 23 July. ETH had just over 121.5 million addresses by the start of July last year. However, those addresses had increased to 155.1 million by 23 June.
The increase in ETH addresses and balance in addresses especially since mid-June confirms the strong accumulation near the $1,000 price level. ETH’s 30-day MVRV ratio confirms that some address balances that accumulated near the latest lows are already in profit.
The MVRV ratio aligns with ETH’s latest recovery. It suggests that there is a strong buy wall near the $1,000 price level. However, the market is still full of uncertainty and the ETFs still have a lot of firepowers if they decide to sell some more.
Bitcoin: On-chain metrics to consider in this bear cycle before going…
The crypto market has had quite a ride this month after bearish waves struck down major cryptocurrencies. The global crypto market capitalization also fell below $1 trillion leading to failing crypto institutions such as 3AC and Celsius. Bitcoin also suffered heavy drawbacks during the period.
BTC reached its lowest levels since December 2020 after dropping below $17,750. Starting the month at around $32,200, the largest-sized crypto has taken a lot of heat and at press time, it was trading at $21,000. The king coin was up by more than 2% in the past day and was just down 0.05% during the week. This was a good signal of recovery after treading through bearish downturns early in June.
Nearing market bottom
On-chain data analytics platform CryptoQuant released the latest update surrounding Bitcoin. It stated that the current BTC price is undervalued. Most on-chain indicators indicate that we are close to a market bottom for Bitcoin.
BTC’s indicator of Net Unrealized Profit/Loss was hovering around -0.06, at press time. This is the initial signal for nearing a market bottom. In the latest crypto crash, there were many addresses that recorded losses when BTC reached the 18-month bottom of $17,744.
According to CryptoQuant, the MVRV ratio has fallen significantly during the current run. At press time, it was estimated at around 0.93, suggesting an undervaluation of BTC.
There was, however, a little spike in Miner’s Position Index but it was still estimated at -0.6. This means that miners are circulating more than their daily distribution in the moving average of the YTD.
Miners have also increasingly offloaded their holdings to exchanges. This can indicate that some miners’ revenue cannot meet the break-even point.
For many investors, this is a good time to start accumulating again if they want to recoup their losses. With the regulatory proposal for digital assets already in place in the United States, there is still hope for a bullish surge in the coming months.
SHIB’s Shibarium Public Beta Is Planned For Deployment In Q3
The shiba inu crypto community is anticipating the launch of the layer two (L2) scaling solution Shibarium after it was revealed that the public beta will launch in the third quarter. According to shiba inu developers Shytoshi Kusama and Ryoshi, the layer two solution will bring transaction fees down considerably and possibly to zero.
Shiba Inu’s L2 Solution Shibarium to Launch in Q3, Ethereum Whale Acquires 163.2 Billion SHIB
The meme token shiba inu (SHIB) has seen a 33.6% gain against the U.S. dollar during the last seven days and much of the rise revolves around the Shibarium announcement. Furthermore, an ethereum whale purchased 163.2 billion SHIB during the last 24 hours worth around $1.74 million using today’s SHIB exchange rates. There’s been a lot of discussion about the L2 scaling solution Shibarium on the project’s Discord server. and
Furthermore, the Unification Foundation, a team of developers behind Shibarium, revealed a few updates about the upcoming project. According to the Unification Foundation, Shibarium was launched in a private setting during the alpha testnet phase. The developers explained that the results were successful and “the primary tool under heavy development is the wallet application.”
The Unification Foundation’s Maziar Sadri further added:
The Shibarium Public Beta Testnet is planned for deployment in Q3, to coincide with the FUND Testnet upgrade which includes the much anticipated IBC/Gravity/wFUND updates. The public Beta Testnet will allow parties to fully interact with the network, including the validation process.
Year-to-Date SHIB Is up 56% Against the US Dollar
While SHIB is up 33.6% during the last week, it is still 87.6% down from the all-time high the token saw in October 2021. Despite this, year-to-date, the SHIB token is still up 56% today against the U.S. dollar. At the time of writing, SHIB holders making money at the current price is around 23% according to Into the Block statistics. SHIB has a large concentration of whales as Into the Block metrics indicate that SHIB’s concentration of large holders is roughly 81%.
SHIB also has a burn strategy that aims to make the crypto asset more scarce by allowing people to burn SHIB in the burn portal. While burning helps reduce the SHIB supply there’s 589,390,205,650,282 SHIB in circulation today. While shiba inu has gained more than 33% during the past week, 10.1% was gathered during the last 24 hours.
Tags in this story
What do you think about the upcoming Shibarium launch? Let us know what you think about this subject in the comments section below.
Jamie Redman is the News Lead at Bitcoin.com News and a financial tech journalist living in Florida. Redman has been an active member of the cryptocurrency community since 2011. He has a passion for Bitcoin, open-source code, and decentralized applications. Since September 2015, Redman has written more than 5,000 articles for Bitcoin.com News about the disruptive protocols emerging today.
Image Credits: Shutterstock, Pixabay, Wiki Commons, Editorial feature photo credit: Dennis Diatel
Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.
Bachelors Scholarship7 days ago
Stanford University Scholarships In USA 2022-2023 | Fully Funded
Fully Funded Scholarships7 days ago
McGill University Scholarships In Canada 2022-2023 (Fully Funded)
Bitcoin5 days ago
What to know about Bitcoin’s pricing model and whether BTC will be ‘part of it’
Binance6 days ago
Binance Suspends Direct Deposits And Withdrawals In Brazil
Altcoins6 days ago
The many reasons why DOGE believers aren’t done yet
1600 blocks7 days ago
Bitcoin’s Sinking Price Pushes Hashrate Below 200 Exahash, Mining Difficulty Expected To Slide 2.8% Lower
2:1 ratio of sellers6 days ago
Cumberland Sees Massive OTC Moves During Crypto Market Rout — ‘Most Volume We’ve Seen This Year’
ada6 days ago
Cardano [ADA]: Plotting the path to a 125% rally after 1 August