Weekly Recap: Bitcoin, Binance, Ethereum, Solana... the crypto news not to be missed!

From the meteoric rise of Bitcoin crossing the $70,000 mark, fueled by increased scarcity and massive institutional demand, to Coinbase’s critical examination of the viability of AI-related cryptos, the crypto landscape is constantly evolving. BlackRock shakes the investment world by becoming the largest holder of Bitcoin, while Ethereum faces challenges with soaring transaction fees. Bitcoin breaks new records with blocks reaching 3.97 MB, and Solana defies expectations with record volumes on DEXs.

Bitcoin at $70,000!

Bitcoin reaches new heights by exceeding the $70,000 mark, a record high that has sparked excitement among many market players, including Elon Musk. Bitcoin’s performance can be explained by a combination of factors, including the increased scarcity of Bitcoin available on the market, strong institutional demand via Bitcoin ETFs, and the approach of the next halving, scheduled in 41 days. These elements contribute to unprecedented buying pressure, pushing prices to historic levels.

However, this meteoric rise raises concerns about the possibility of a major speculative bubble. Voices are rising to warn against the risks associated with an overheated price surge potentially disconnected from economic fundamentals. The massive interest in Bitcoin, reflected by Google searches, bears witness to a global popular fervor, but also to a market that could defy all rationality. Time will tell if these fears are justified or if Bitcoin continues on its upward trajectory, fueled by intoxicating speculation and significant financial disruption.

AI and Crypto: A fleeting trend, according to Coinbase

The recent hype around AI-related cryptos is under scrutiny by Coinbase, highlighting the sustainability challenges for this emerging sector. According to a report by Coinbase analyst David Barragan, the surge in AI crypto prices is more driven by the general excitement around AI than by solid fundamental bases. This situation raises questions about the long-term sustainability of these tokens, in a context where generative AI is leading to speculation on niche crypto sub-ecosystems.

The report also highlights the tension between cryptocurrencies’ philosophy of decentralization and the still very centralized nature of current AI. While cryptos aspire to decentralization, AI relies largely on centralized infrastructures, posing a major challenge to the development of a truly decentralized and sustainable AI application ecosystem on blockchain. Despite these challenges, Coinbase does not completely close the door to the future of AI-related cryptos, considering blockchain as a potentially rich source of data for AI and the possibility of gradual decentralization. However, the warning is clear: the path to sustainable disruption by AI in crypto is still long and uncertain.

BlackRock: New king of bitcoin!

BlackRock has just dethroned MicroStrategy and becomes the largest holder of Bitcoin. This meteoric rise of BlackRock, the asset management giant, was realized thanks to the huge success of its Bitcoin ETF, the IBIT, which saw massive capital inflows, reaching a record of $473.4 million in a single day on March 7. The entire week saw total inflows of $2.07 billion into the IBIT, signaling unprecedented interest in this digital asset among institutional investors.

This upheaval in the hierarchy of Bitcoin holders can be explained by several factors. The introduction of spot Bitcoin ETFs attracted institutional investors through their regulated structure and direct access to digital assets. BlackRock capitalized on this trend thanks to its established position and low-fee strategy, attracting a large number of investors. At the same time, increasing regulation of cryptocurrencies has pushed institutions towards compliant investment vehicles, such as the IBIT. This shift in leadership illustrates the rapid evolution of the cryptocurrency landscape, with traditional finance players overtaking pioneers, and highlights the burgeoning institutional adoption of Bitcoin.

Ethereum: Soaring Fees, A Cause for Alarm?

The Ethereum blockchain is currently in the spotlight, not for a new innovation or a rise in its token, but for a more concerning reason : the explosion of transaction fees. As the Dencun upgrade approaches, these fees have reached historically high levels, surpassing records from the past ten months. Network users are facing a significant financial burden, highlighting the challenges of accessibility and decentralization that Ethereum still needs to address.

Despite these concerns, the Dencun upgrade, scheduled for March 13, 2024, brings hope for change. With its promise to significantly reduce costs with the introduction of “proto-dank sharding,” many hope to see an improvement in the situation. However, this challenging context could also open doors for Ethereum’s competitors, like Solana, Avalanche, or Polygon, which offer more affordable and high-performance alternatives. As the industry awaits to see if Dencun will deliver on its promises, Ethereum’s future and its dominant role in the crypto space may well be called into question.

New Horizon for Bitcoin: Blocks up to 3.97 MB!

Bitcoin has recently reached an impressive technological milestone by setting a new record with a block size of 3.97 MB. This achievement is largely attributed to the excitement around Bitcoin Ordinals, which significantly influenced the blockchain ecosystem. The community is divided between those who see Ordinals as an advance and those waiting for significant improvements with the next version of Bitcoin Core.

The increase in block size was catalyzed by a major transaction containing a significant Runestone AirDrop image inscription. While some celebrate this milestone as a way for Bitcoin to compete with other payment systems, others fear that it may lead to increased centralization, potentially jeopardizing the security of the network. With mining difficulty reaching a record 81 trillion and a forecasted rise due to the next halving, the Bitcoin ecosystem is preparing for other major adjustments.

Binance and the SEC: A Clash of Titans!

Binance US is currently in turmoil, with the announcement of massive layoffs affecting 200 employees. This drastic decision follows regulatory battles with the US Securities and Exchange Commission (SEC) and illustrates the considerable pressure the company faces in the context of financial regulation.

Additionally, the SEC persists in its role as a strict regulator, targeting Binance US and making accusations of bypassing securities laws. Despite this pressure, Binance US has risen to fight, armed with top lawyers, to contest the SEC’s proceedings. This legal arm-wrestling highlights the tensions between innovation in the cryptocurrency sector and existing regulatory frameworks. The 200 jobs lost at Binance US are just the latest casualties of this large-scale conflict, whose stakes go far beyond the individual interests of both parties.

Solana’s Meteoric Rise

Solana (SOL) continues its impressive climb and approaches the psychological threshold of $150, with crypto analysts even predicting a surge beyond $200. This increase is notably attributed to the explosion of transaction volumes on the DEXs of the network. Forecasts remain optimistic despite the current price of SOL still being well below its historical high of November 2021.

The Solana DeFi ecosystem is experiencing exponential growth, with daily DEX volumes surpassing $2 billion on several occasions, reaching a peak of $2.85 billion. Solana now holds 28.5% of the total DEX volume, positioning itself just behind Ethereum. This dynamic testifies to the growing place of Solana in the DeFi universe, despite the technical challenges faced by the network. With key DEXs like Orca, Raydium, and Phoenix registering significant exchange volumes, Solana asserts itself as a serious contender to Ethereum and attracts the attention of institutional investors.

That’s the main news to remember for this week. But if you want a more detailed recap and in-depth analysis directly in your inbox, don’t hesitate to subscribe to our weekly newsletter.

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