Blockchain Bites: Bitcoin at $ 15K, $ 1B by Silk Road Bust

Bitcoin’s price continues to rise amid electoral uncertainty. Wasabi Wallet will offer automatic CoinJoins that preserve privacy in its next update. A major Russian energy supplier is entering a bitcoin mining joint venture.

Confiscation of $ 1 billion of BTC
The US government is suing for the confiscation of thousands of bitcoins, totaling more than $ 1 billion, seized on Tuesday. According to the United States Department of Justice, these bitcoins are linked to the Silk Road market. The address that holds the bitcoins has been inactive since 2015, when the coins were transferred to the now defunct cryptocurrency exchange BTC-e. According to Bloomberg, authorities seized the funds from an unknown hacker who had access to the address. BTCs are likely to be auctioned now, reintroducing them into the market offering. Almost equivalent amounts of bitcoin gold, bitcoin sv and bitcoin cash were also recovered from the address.

Fat finger
Reddit user “ProudBitcoiner” accidentally paid 23,5172 ETH (about $ 9,400) for a $ 120 transaction, the person revealed in a post. The costly mistake occurred when manually entering a “Gas Price” when executing a trade on the DeFi Uniswap liquidity protocol rather than a “Gas Limit”. The Ethermine mining pool processed the transaction and collected the unexpected fee, which was much higher than the current average of 0.0022 ETH ($ 1.07), although ProudBitcoiner contacted the miner for assistance in potential recovery of the fee.

Co-mining enterprise
One of the largest aluminum and energy producers in the world will begin mining cryptocurrencies through a joint venture with BitRiver, which already owns the largest mining site in Russia and is looking to expand. En +, whose largest shareholder is Russian billionaire oligarch Oleg Deripaska, owns four large hydroelectric power plants in Siberia which produce about 7% of the country’s electricity. The joint venture (an 80/20 split between En + and BitRiver) will offer 10 megawatts of power to miners to host ASICs, with the potential to expand to 40 megawatts. En + was sanctioned by the United States in 2018, although these bans have since been lifted.

Expansion of the exchange
Coinbase is hiring in Japan, with renewed plans to launch. Although the U.S.-based exchange did not receive a mandatory operating license from Japan’s Financial Services Agency (FSA), in March it became a second-class member of the Japan Virtual Currency Exchange Association, a regulator-approved self-regulatory organization. IT, data, finance and accounting, legal, marketing and communications, customer experience and international expansion roles are currently open. CoinDesk’s Sebastian Sinclair reports that Coinbase has plans to expand to Japan from 2016.

Privacy protection
Wasabi Wallet is looking to overhaul its privacy-focused bitcoin software wallet with user-centric design and privacy enhancements, including automatic and predefined CoinJoins. (A CoinJoin is a method of combining BTC transactions from multiple users to better hide identities). Separately, Blockstream’s engineers will implement improvements to multi-signature bitcoin transactions, with privacy benefits. The “MuSig2” design is based on previous multi-signature schemes – a way to authorize transactions using more than one private key – reducing the technical complexity and amount of communication between the parties to operate.

The stimulus of Bitcoin
Bitcoin surpassed $ 15,000, the first time since January 2018. The cryptocurrency has now risen by 7.8% in the past 24 hours and by more than 108% year-on-year, with little sign of slowing. CoinDesk’s Omkar Godbole notes that this recent rally represents a roughly 40% climb in the past four weeks alone. Backed by an impending sense of monetary stimulus, undetermined as to who will win the US presidential election, analysts expect this growth to continue. “We may not know what a post-election is [fiscal] it may sound like a stimulus, but investors still believe the [Federal Reserve] it will continue to print money at a pace that favors the finite supply of bitcoin, ”John Kramer, a trader at cryptocurrency provider GSR, told CoinDesk.

Someone has bet
Forecasting markets are still bustling amid the uncertainty of the current US presidential election process. Yesterday, the decentralized forecasting platform Polymarket became the fourth blockchain project that generates the highest fees, according to Cryptofees, only behind Bitcoin, Ethereum and the DeFi Uniswap protocol.

Currently, perhaps of course, the largest pool on Polymarket is “Will Trump Win the 2020 US Presidential Election?”, With nearly $ 8.8 million in trading volume. While the predictions went in President Donald Trump’s favor on the first night of the ballot count, most bettors now see former Vice President Joseph Biden as the favorite to win.

“I think being the top 4 paid blockchain apps, literally anything related to blockchain, is madness,” Polymarket CEO Shayne Coplan told CoinDesk’s Sebastian Sinclair. “In this election cycle alone, we have seen our volume exceed $ 10 million, which is much higher than we expected in such a short amount of time.”

Of course, prediction markets aren’t the only way for people to bet on election results. Most markets are likely to be, in some way, processing the current moment of anxiety and uncertainty.

For example, the Chicago Mercantile Exchange (CME) bitcoin futures trading during the US election increased 75% above the 2020 average. The CME is routinely one of the largest and most institutionally driven crypto options exchanges. Average daily open positions, which allow traders to buy bitcoin between a specified period, increased by 20% in just the first two days of November compared to October.

To make sense of bitcoin’s current three-year high, Bill Noble, chief technical analyst at Token Metrics, said that regardless of the election result, monetary stimulus is to be expected. This reinforces one of the main narratives of bitcoin (the things people believe about the oldest cryptocurrency) as a hedge against inflation.

“If there is social turmoil due to a Trump victory, the Fed prints. If the election result is a blue wave and taxes go up, the dollar goes down because the Fed prints more and more, and more and more, ”Noble said.

Going back to forecast markets: Anthony Sassano wrote: “I have long thought that one of the main reasons why forecast markets had not yet taken off was that there were few interesting markets to bet on.”

This is not to say that market forecasts are better or worse than traditional methods of measuring risk. Cami Russo’s publication The Defiant said Ethereum’s prediction markets are the “best or worst answer” to uncertainty, while Decrypt found that FTX’s platform largely mirrors FiveThirtyEight’s model.

With election headlines currently dominating the talk, the stakes are high and the bets are open.