- Bitcoin traded to a low of $46,310 from a high of $48,053 as of midnight August 27, 2021.
- Cardano (ADA) decreased its market capitalization by $9.68 billion.
- Bitcoin miners have reported a 13% increase in network difficulty that has slowed down production.
Bitcoin (BTCUSD) receded from its August 2021 highs above $50,000, with analysts viewing a potential slowdown to the crypto rally. As of midnight on August 27, 2021, it traded to a low of $46,310 from a high of $48,053. It dropped 2.62% in the last 24 hours, with investors worried about the course of the previous bull run.
There was a general recession among other tokens, with Ethereum (ETHUSD) decreasing 2.44% to $3,081.03, Cardano (ADA) lost 4.87% to $2.512502, and Binance coin (BNB) lost 4.65% to trade at $469.15.
Cardano (ADA) decreased its market capitalization by $9.68 billion between August 26, 2021 (at $90.60 billion) to August 27, 2021 ($80.92 billion). However, this crypto giant has led calls to green crypto-mining as Bitcoin’s annual CO2 transmission reached 57 million tons.
As of August 26, 2021, Bitcoin’s energy consumption levels hit 152.77 TWh per year.
Bitcoin miners have reported a 13% increase in network difficulty that has slowed down production. The recent crypto-mining ban in China forced miners to relocate their machines outside the Asian powerhouse. Some have moved to North America, while others have established mining grounds in Russia and Kazakhstan.
Bitcoin’s computing hash rate rose 28.47% from 97 exahashes (13.7T) in July 2021 to 126 exahashes (17.6T) in August 2021.
An increase in the hash price reduces mining profitability leading to a reduction in crypto prices. In essence, miners are finding it hard to build the next block in the blockchain network. Additionally, a downward adjustment to the hash rate exceeding 10% is also considered substantial as far as competitive mining is concerned.
However, the recent rally was occasioned by profit-taking among plugged-in miners (especially those from the US) after the Chinese ban took effect.
As the crypto market is headed towards all-time highs, global jurisdictions are tightening their regulatory checks and balances.
Binance, the largest cryptocurrency platform was forced to suspend its offerings (on futures/ derivative accounts) in Europe following regulatory pressures. In India, WazirX, a crypto firm owned by Binance, is under investigation for money laundering.
A criminal complaint was filed against the crypto-exchange firm in Thailand while the Cayman Islands banned the operations altogether. However, Binance is working to prove that its decentralized nature is in tandem with all regulatory bodies in its areas of operations.
While China is bent on increasing its crypto-mining ban, the Iranian government announced that it would authorize legal mining operations from September 22, 2021.
Power deficits in May 2021 had prompted Iran to restrict mining and cut off electricity supply to the farms. The country’s power generation and transmission company, Tavanir, will continue to resupply power to the mining firms to tap into the crypto fortunes.
The BTCUSD pair moved closer to its upward breakout point at $47,013, indicating the uptrend slowdown. It also inched below the 9-day EMA at 47,710.97.
A possible decline may see the price correcting to 43,075.11. The 14-day RSI shows a possible downtrend due to the indicator heading down to 59.10.
However, we could still see an uptrend above $50,000 as the price moves above the consolidation around $47,000.