Toncoin Gears Up For A Fresh Rally With Bullish Momentum Building

In a recent tweet, CryptoQuant CEO Ki Young Ju sent out a warning to Bitcoin traders, highlighting potential market movements and urging caution, especially for those using leverage.

The CryptoQuant CEO warned that Bitcoin might experience a pullback or move sideways for months. This signals that the current bullish momentum could slow down, leading to a period of consolidation or a minor pullback.

Despite the warning, Ju expressed uncertainty about the end of the current bull cycle. According to CryptoQuant, other on-chain indicators remain bullish, indicating that the long-term outlook for Bitcoin remains positive. This mixed signal highlights the speculative nature of predicting market movements and the importance of considering multiple factors.

In line with this, Ju urges caution for those trading with leverage. Leveraged trading can boost profits but also increase the risk of significant losses. In volatile markets, leveraged positions could be vulnerable to liquidations.

A liquidation occurs when an exchange forcefully closes a trader's leveraged position because the trader was unable to meet the margin requirements. Large-scale liquidations may imply market extremes, such as panic selling or purchasing.

Bitcoin price action

Following two months of consolidation, Bitcoin broke out of its range and reached a new all-time high of $109,358 on Jan. 20.

The launch of a Securities and Exchange Commission task force on U.S. digital-asset regulations helped to lift the markets at the start of the week. The task force will create a "comprehensive and clear" regulatory framework and will be chaired by Hester Peirce, the SEC commissioner known as "Crypto Mom" for her opposition to SEC enforcement proceedings against cryptocurrency businesses.

Bitcoin traded at about $105,076, up 1.29% in the last 24 hours and slightly below the record high of $109,358 set on Monday. The rest of the crypto market was mixed in early Monday's trading session.

On the macroeconomic front, investors are awaiting economic data on Wednesday, which might provide clues as to the outlook of the economy.

Day Two of the Trump administration and the DOGE (Department of Government Efficiency) website is up and running. Only time will tell if DOGE actually accomplishes anything. The big idea behind it is to find savings and improve the efficiency of the government. And who better to do that than Elon Musk himself?

Maybe this new government department could start with disbanding useless government departments?

Dogecoin to be the Official US Government Cryptocurrency?

Transaction delays, canceled transfers and frustrated users — recent weeks have been challenging for Coinbase and its Solana integration. Amid a surge in activity on the popular blockchain, the exchange has faced mounting criticism over its inability to keep up. Now, the company is promising a major overhaul.

Coinbase’s CEO Brian Armstrong has made a public commitment to significantly improve the platform’s support for Solana following recent transaction delays that have affected users.

In a statement addressing the ongoing issues, Armstrong explained that the exchange has now triaged the Solana backlog and assured users that transactions should process more swiftly.

However, the company is not stopping there. The CEO acknowledged the need for deeper changes to scale the infrastructure and better handle the growing volume of activity on Solana.

Armstrong emphasized that Coinbase must “step up its game” on Solana, pledging to provide the same level of support for Solana as the platform currently offers for Bitcoin, Ethereum and Base. Acknowledging the surge in activity as a “high-quality problem,” he made it clear that improving the infrastructure to meet such demand is a top priority.

What happened?

The chaos started with a bunch of transactions, many of which were tied to a newly launched meme coin that got a lot of attention in the crypto community. Users were reportedly waiting hours, sometimes more than ten, for funds to transfer between their Coinbase accounts and SOL wallets. Canceled transactions and delays in deposits added to the frustration, leading to discussions on social media.

Some users even questioned Coinbase's commitment to supporting Solana, pointing to its affiliation with Base, an Ethereum-based layer-2 network, as a potential conflict of interest.These speculations were made worse by calls for greater transparency around Coinbase's Solana holdings, with users asking for reassurance that their funds were secure.

Yet, the issue may not be entirely with SOL. Other major exchanges were reportedly able to process transactions far faster, suggesting the problem stems from Coinbase's infrastructure.

Reactivated after 13 years, a long-dormant Bitcoin wallet from the Satoshi era now contains an incredible 6,400 BTC, or roughly $678 million. The cryptocurrency community is talking about this unusual movement of early Bitcoin. The sheer size of holdings from the early days of Bitcoin, which are frequently linked to conjectures regarding their origin and purpose, makes such events noteworthy.

The reasons behind the decision are called into question by the wallet's reactivation. Whether the money will be sold, transferred or just moved for security reasons is unclear, but thus far, the market impact seems to be small. Since Bitcoin currently has strong liquidity levels and a market valuation of over $500 billion, even large amounts like $678 million are unlikely to materially alter the overall price trajectory. Regarding price performance, Bitcoin is still trading close to the $105,000 threshold.

Bitcoin has been steadily increasing over the last few months, but now it is encountering psychological resistance. Despite this, the long-term trend is still positive due to growing institutional interest adoption and agreement that Bitcoin is a good inflation hedge. In the event that such a wallet is activated, sentiment may be affected.

A portion of these funds may be liquidated by the holder, which could result in short-term volatility. However, any price correction would probably be short-lived and contained given the depth of the Bitcoin market right now. The history of Bitcoin and its allure as a long-term store of value may also be rekindled by this movement. These kinds of incidents underscore Bitcoin's distinct place in the financial industry as it develops further.

Key levels are important for investors to watch: $100,000 is a crucial support zone, and $110,000 is probably where the next significant resistance will appear. The market's capacity to withstand such fluctuations without suffering major setbacks demonstrates Bitcoin's maturity and tenacity, boosting faith in its long-term outlook.

The Official Trump (TRUMP) memecoin has surged over 12% in the past 24 hours, climbing back above the $42 mark, according to The Block's Price Page. Analysts suggest investors don’t need to worry about a supply shock for the next three months, despite criticism of its "poor tokenomics."

Launched less than 72 hours before his inauguration, the Official Trump memecoin quickly soared to a $14.5 billion market cap, before pulling back to a current value of $8.4 billion. "Official Trump tokenomics are poor, but with no unlocks for 3 months, there is a decent stretch without worry of new supply," K33 Research DeFi analyst David Zimmerman said in a report on Wednesday.

Currently, 20% of the Official Trump supply is in circulation. Half of this circulating supply was allocated for liquidity, while the other half was offered to the public. The remaining 80% is locked and will be released gradually over a 36-month period. These locked tokens are divided among six entities, labeled “Creators and CIC Digital 1-6.”

Each group faces a lock-up period ranging from 3 to 12 months, after which an initial unlock cliff of 10% or 25% will be followed by daily unlocks over two years. The first unlock, affecting the "Creators" and "CIC Digital 1," is scheduled for three months from now.

Zimmerman noted that such tokenomic structures are outdated for memecoins, as the market increasingly favors projects with fully circulating supply at launch. “There’s no sugar-coating this—these tokenomics are horrendous for a memecoin,” he added.

According to the K33 Research report, Trump has an established licensing deal with CIC Digital and CIC Ventures, two firms owned by The Donald J. Trump Revocable Trust. "It is not clear exactly who the 'Creators' are, but Trump will have a significant financial interest in the memecoin through CIC Digital," Zimmerman said.

Melania Meme struggles to regain momentum

Riding on Official Trump’s momentum, the U.S. First Lady launched her own memecoin, Melania Meme (MELANIA), on Sunday. Within 12 hours, Melania Meme skyrocketed in value 250 times, reaching a market cap of over $2 billion. Similar to Official Trump, the tokenomics include substantial allocations for the “team,” “treasury,” and “community."

However, Melania Meme offers a more aggressive unlock schedule, with an initial lock-up of just 30 days, followed by a 10% team unlock and linear vesting over 12 months.

Melania Meme has declined by over 9% in the past 24 hours, now priced at $4.00, according to The Block's Price Page.

Disclaimer: The Block is an independent media outlet that delivers news, research, and data. As of November 2023, Foresight Ventures is a majority investor of The Block. Foresight Ventures invests in other companies in the crypto space. Crypto exchange Bitget is an anchor LP for Foresight Ventures. The Block continues to operate independently to deliver objective, impactful, and timely information about the crypto industry. Here are our current financial disclosures.

© 2024 The Block. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Charles Hoskinson, Cardano cofounder, has pledged to support Ross Ulbricht, founder of the Silk Road marketplace. Hoskinson’s promise of support comes after the presidential pardon of Ulbricht, who has been serving a double life sentence plus 40 years in U.S. federal prison.

Ross Ulbricht, Welcome back to the fold

Notably, Ulbricht’s release comes after the new U.S. president granted him a pardon, making him a free man.

Hoskinson wrote in a post on X, "Welcome home, Ross. We, as an industry, have your back. Whatever you need, we are here on your journey back to freedom."

The Cardano cofounder’s message indicates the solidarity he is willing to extend to Ulbricht to help him find his footing. Some stakeholders believe the support could include financial assistance, reintegration efforts or other support to assist Ulbricht.

Hoskinson’s message of support aligns with a similar congratulatory post by Changpeng "CZ" Zhao. The Binance cofounder celebrated Ulbricht’s release, noting that the new president had kept his word. CZ appreciated the gesture, now seen as a life-saving one for Ulbricht.

Ross Ulbricht's impact on crypto

Ross Ulbricht, 41, was imprisoned in 2013 for the role he played in founding and running of the Silk Road darknet marketplace. The charges against him included providing a platform for free trade in illegal drugs using Bitcoin as currency.

Notably, the Silk Road marketplace is arguably the first and largest online platform to embrace Bitcoin as a payment channel. Many in the crypto space still consider Ulbricht one of the founding stakeholders who promoted Bitcoin adoption in the broader society.

Hence, many in the industry have welcomed his release from a prison term that could have resulted in Ulbricht spending the rest of his life in jail.

The plans to release Ross Ulbricht started last year. Following a decade long campaign for his release, he is finally going home.