Weekly review: Bitcoin to $16K, DeFi adds $1.32B in TVL, the US seized $1B in BTC and Ethereum 2.0 launch
- Bitcoin saw major gains as it climbed near the $16,000 level for the first time since the early ICO 2018 burst
- Over $1.32 billion in total locked value flowed into DeFi after the industry saw a decline in late October
- The US seized over $1 billion in BTC moved out from a wallet linked to the Silk Road dark web
- Ethereum 2.0 launch date set for December 1 with staking contract deployed
Bitcoin’s rise back to $16K suggests beginning of major rally
What: Bitcoin almost touched $16,000 on November 6th, which is the second time in history that the major cryptocurrency reached this price level. The last time Bitcoin hovered in the $16K range was back in January 2018.
Why it matters: With strong demand currently stemming from financial institutions, Bitcoin’s next major rally towards its $20,000 all time high could be within much closer sight. As prices rise, mainstream media will start to cover the trend more, meaning that the retail market will also FOMO into the next major rally.
Is DeFi dead? On-chain data shows $1.32 billion growth in TVL
What: After a hyper-growth period in DeFi from June to October 2020, the total locked value (TVL) declined in late October. This week saw a relative recovery with $1.32 billion pouring into the ecosystem that achieved $12.48 billion in TVL at its peak.
Why it matters: DeFi is still very new, with hundreds of experimental projects attracting large capital. DeFi’s financial services powered by smart contracts still hold strong potential in terms of fundamentals, so market corrections are to be expected while the infrastructure matures over time. This suggests that DeFi is far from being dead — rather it’s growing rapidly in terms of new services, products and users.
Record $1 billion in BTC seized by the US Department of Justice
What: The US Department of Justice seized roughly 70,000 BTC, worth more than $1 billion, linked to the Silk Road dark web that was shut down in 2013. This was the largest seizure ever made by the US government.
Why it matters: The billion dollar seizure by the US Department of Justice paints an example of a larger narrative towards the development of clear crypto regulation and compliance. For Bitcoin to gain wider adoption among the mainstream, governments around the globe need to enforce clear policies on crypto to mitigate illegitimate activity.
Ethereum 2.0 set to launch with deposit contract deployed
What: The long-anticipated Ethereum 2.0 Phase 0 launch date has been set around December 1st, which will be officially triggered when the live deposit contract collects the threshold value of 524,288 ETH.
Why it matters: Ethereum’s main challenge comes down to network bottlenecks, high transaction fees and Proof of Work energy consumption concerns. The transition to Ethereum 2.0 marks an important stage towards a much improved blockchain protocol capable of Proof of Stake, which drastically cuts energy costs, lowers transaction fees and improves overall network performance.
