- Bitcoin breaks USD 7,000 in late morning Europe trading
- Analyst claims Ethereum has levelled with Bitcoin on US dollar value metrics of transactions handled
- As the US mulls a second bout of stimulus packages, Bitcoiners wonder how fiat’s value can be properly measured
Late morning trading in London and Western Europe seems to have jolted the bulls into action, as Bitcoin price jumped about 3% to breach the USD 7,000 resistance line as the world’s most-used cryptocurrency attempts to break new heights with just 26 days left to the Bitcoin reward halving event expected on 12 May 2020. A USD 7,144 high so far (CoinDesk) is some distance from the day’s low at USD 6,486 only ten hours ago.
Ethereum is also enjoying a return to USD 170, but it will also be happy to register parity with Bitcoin on one important metric: total value transferred.
Q1 2020 was stablecoins’ best quarter ever.
Driven by a global flight to safety amidst the coronavirus pandemic, stablecoin issuance ballooned over $8 billion in the quarter.
Stablecoins added nearly as much market cap in Q1 2020 as they did in all of 2019. pic.twitter.com/LALwzHmYhW
— Ryan Watkins (@RyanWatkins_) April 15, 2020
According to Messari research analyst Ryan Watkins, the use of the Ethereum network to transfer value around has recently created a new record, with Ether (ETH) and ERC-20 stablecoins like Tether now matching for the first time that of the Bitcoin network. Watkins declared of the data that showed an “explosion” in the use of stablecoins built on the Ethereum network:
“Ethereum is becoming the dominant value transfer layer in crypto.”
When calculated in US dollars, value transfer refers to US dollars in total units on a blockchain transferred on a given day. In Bitcoin’s case, this metric refers purely to the US dollar value of BTC transferred on a given day. Ethereum, which not only transfers ETH but also hosts hundreds of other third-party assets over the network, has a lot of activity related to the transfer of stablecoins on any given day.
Ethereum has Tether to thank for this increase over the last few months, as the popular USDT token migrated to its network as an ERC-20 token. But the data has been challenged by independent developer Udi Wertheimer, who points out that Tether is also transacted widely on Bitcoin’s Omni layer. According to him, if the data includes ERC-20 tokens, then sure Bitcoin network’s metric must include USDT transferred over Omni. Wertheimer even claims:
“USDT on Omni is bigger than all the non-USDT Ethereum-based stablecoins. If you include USDC and the smaller ones, you should also include Omni-USDT.”
My point is it doesn’t change the conclusion.
USDT on Omni transferred ~$90million day on average for the past 3 months. The same as USDC.
— Ryan Watkins (@RyanWatkins_) April 15, 2020
Watkins had a swift retort, saying that the inclusion of Omni would have led to the same conclusion, as “USDT transferred over Omni has dropped substantially as USDT has migrated over to Ethereum”.
Meanwhile, Bitcoin advocates the world over are pricking their ears up as the United States government prepares yet another stimulus package for a struggling economy amid a slow down induced by the Covid-19 pandemic.
According to the latest reports, President Trump’s regime is planning to put USD 400 billion on new stimulus plan that will distribute USD 2,000 each month to every American adult citizen.
Two Democrat congressmen announced the Emergency Money for the People Act on livestream on PSCP, which promises universal basic income for six months to anyone aged 16 years and above. Congressman Ro Khanna declared:
“We’ve got to put money in the pockets of people who have lost income. And we have a bill that says you’re going to get up to 2,000 bucks — not just one time, but for six months.”
This will be piled on atop existing cash handouts that have already been approved, with Trump claiming that checks bearing his name will give a one-time payment of USD 1,200 to adults and USD 500 to children. It has been a contentious scheme as there are reports that these funds will be confiscated by banks if recipients have debt obligations.
Bitcoin users online have poured scorn over these plans, suggesting that the state’s continued meddling in an already weakened economy can only lead to disastrous outcomes. Gold Bullion International co-founder Dan Taperio said today that fiat money would be difficult to put a value to:
“The Rubicon has been crossed. Even surprises me and I have been a strong advocate for extreme policy response, ‘unlimited,’ in the face of economic collapse… Soon will be difficult to value money. If so, all society’s values realign. Expect volatility.”
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