Bitcoin price remains bid at current levels and eyes a move above $12,000. If we consider the current consolation as a continuation pattern, the price of Bitcoin has room to advance even higher, to $12,600 or beyond.

Momentum favors a higher Bitcoin price. Recent developments in the international arena show investors lose trust in central banks and more of them look for alternative options. Besides gold, Bitcoin feels like the right alternative.

Recent events in the crypto arena showed increased adoption of Bitcoin from various investors. The most prominent of them, Square, was responsible for the bounce from the $10,000. Right after Square announced that it bought $50 million worth of Bitcoin or one percent of its total assets, the price of Bitcoin moved about ten percent in the following days.

A better understanding of Bitcoin comes from a direct comparison with its rival gold. At the time of making long-term investment decisions, investors allocate some part of their portfolio to gold. This is particularly the case of endowments, as the main investment objective is to protect the value of their assets in the long term.

But if we look at the price of Bitcoin since inception and we interpret it in terms of gold (i.e., Bitcoin priced in gold), we see a clear, rising trend. It recently reached six ounces of gold and rising. Judging by this metric only, Bitcoin, at least so far, proves to be the better alternative.

The chart below shows the Bitcoin price consolidating in a triangular pattern. It looks like a possible pennant, and the measured move points to a new high when compared to the most recent one at $12,400.

To trade it, bulls may want to wait for the upper edge of the triangle to break before going long for $12,600 while having a stop-loss order at the lower edge of the triangular pattern. This way, the risk-reward ratio makes sense.

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Bitcoin Price Ready For a New Pop Will It Do It Today? - InvestingCube

It was a choppy start to the week. Bitcoin fell to a Monday intraweek low $11,111.0 before finding support.

Steering clear of the first major support level at $10,782, Bitcoin bounced back to a Monday intraweek high $11,740.0.

Coming up against the first major resistance level at $11,746, Bitcoin fell back to $11,210 levels and into the red on Friday.

A relatively bullish end to the week, coming off the back of 2 consecutive days in the green delivered the upside for the week.

4 days in the green that included a 1.54% gain on Monday delivered the upside for the week. A 1.60% slide on Friday, limited the upside for the week, however.

Bitcoin would need to avoid a fall through $11,456 pivot to support a run the first major resistance level at $11,802.

Support from the broader market would be needed for Bitcoin to break out from last weeks high $11.740.0.

Barring an extended crypto rally, the first major resistance level and last weeks high $11,740.0 would likely cap any upside.

In the event of a breakout, Bitcoin could test resistance at $12,000 before any pullback. The second major resistance level sits at $12,085.

Failure to avoid a fall through the $11,456 pivot would bring the first major support level at $11,173 into play.

Barring an extended sell-off, Bitcoin should steer clear of sub-$11,000 support levels. The second major support level sits at $10,827

At the time of writing, Bitcoin was down by 0.31% to $11,482.0. A mixed start to the week saw Bitcoin hit an early Monday morning high $11,550.0 before falling to a low $11,459.1.

Bitcoin left the major support and resistance levels untested at the start of the week.

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Bitcoin and Ripple's XRP - Weekly Technical Analysis October 19th, 2020 - FX Empire

Since January, over$1.5 billionworth ofbitcoinhas been tokenized into ERC-20 tokens to use in the emerging decentralized finance (DeFi) ecosystem on Ethereum. These DeFi applications offer an increasingly large array of potential use cases for bitcoin investors looking for alternative ways to issue loans or make trades on new exchange platforms.

Tokenizing bitcoin serves as a bridge between these two leading cryptocurrency communities and an important step forward for traders and investors taking advantage of the features offered by both blockchains. Through tokenized bitcoin projects, the powerful monetary properties of bitcoin can be leveraged in the ever-growing collection of Ethereum-based cryptocurrency applications.

CoinDesk is preparing for theinvest: ethereum economyvirtual event on Oct. 14 with a special series of newsletters focused on Ethereum's past, present and future.Every day until the eventthe team behind Blockchain Bites will dive into an aspect of Ethereum that excites or confuses us. Today's intro is written by CoinDesk reporter Zack Voell.

Tokenized bitcoin also revives an age-old discussion on the merits of decentralization versus convenience. Some projects like Thesis tBTC project prioritizes decentralization while others, like the industry-leading wrapped bitcoin (WBTC) project by BitGo emphasizes convenience through a central custodian for all tokenized coins.

To date, seven different projects offer bitcoin tokenization services, and that list is likely to grow along with demand for more bitcoin-backed ERC-20 tokens. As the amount of tokenized bitcoin grows, the importance of each projects security and reliability becomes even more important as does the continued development of Ethereum-based applications that pique the interest of tokenized bitcoin holders.

Its a topic of conversation likely to be covered by CoinList and BitGo representatives when speaking on the virtual panel Unlocked: BTC on Eth: Having Your Cake and Eating It, Too atinvest: ethereum economythis coming Wednesday.

Featured panel

The Fees Are Too Damn High: DeFi Pushes Ethereum to Its LimitEthereum has delivered many mind-boggling innovations some by design, others out of necessity. With DeFi pushing the ecosystem, existing infrastructure is being maxed out. Can Eth 2.0 address these pain points? Is this the opportunity for so-called Eth Killers?

MakerDAOs Rune Christensen will assess this critical fork in the road along with representatives from NEAR Protocol and Framework Ventures at invest: ethereum economy. Tune into The Fees Are Too Damn High: DeFi Pushes Ethereum to Its Limit, on Oct. 14 starting at 9:30 a.m. ET.

Ethereum 101

To the surprise of many, bitcoin has been a breakout star in Ethereums decentralized finance (DeFi) moment. Taking the form of wrapped or tokenized bitcoin, the digital asset takes the best of both blockchains bitcoins price value and brand along with Ethereums programmability into one highly in-demand token.

CoinDesk tech reporter Will Foxleybreaks down the mechanics behind these tokenized versionsas well as the reasons investors would want to trade representations of BTC on a competing blockchain.

Why use tokenized BTC?

What bitcoin on Ethereum does is simple: It provides liquidity for growing decentralized exchanges (DEX), such as Uniswap. Bitcoins current market cap is five times larger than the second largest cryptocurrency,ether(ETH). That money can be put to use making more money.

Tokenized bitcoin allows investors to bring large amounts of value over to the Ethereum network and its young DEX market in a few clicks.

DeFi is considered vastly immature when compared to traditional or centralized exchange (CEX) markets. This can be seen in the large price spreads between orders on exchange books between different DeFi markets.

Price differences on markets can be exploited by traders in what is called arbitrage opportunities.

Wrapped bitcoin is often the asset of choice for investors seeking arbitrage. Bitcoin packs a large punch in terms of price value. More money on DeFi trading platforms makes the markets themselves stronger as additional buying and selling options are presented.

But tokenizing bitcoin isnt without risks, particularly software risk. Investors who want exposure to bitcoins liquidity pay higher interest rates to cover the risk of losing an asset in addition to getting exposure to the first cryptocurrencies liquidity.

Security of bitcoin investmentsFor tokenized bitcoin, security boils down to the type of custodianship and if the investment is collateralized. Three major models exist: a centralized firm like BitGo; a smart contract system with collateral, such as tBTC; or a complete, synthetic-asset backing employed by sBTC.

BitGos centralized model requires users to give the custodian BTC to receive an ERC-20 token-equivalent of BTC in return. That ERC-20 can then be sold on secondary markets or plugged into a DeFi application to earn yield.

Keep Networks tBTC, which launched last month, is similar to WBTC but replaces the centralized BitGo model with a network of nodes, wallets and smart contracts. This network aims at bringing more decentralization to BitGos process by allowing both parties the bitcoin depositor and custodian to interact trustlessly through software.

A few features make this possible, such as the bitcoin depositors being able to choose who holds their bitcoin and a 150% security bond (held in ETH) pledged by the custodians on the off-chance they run to the hills with the deposits.

Rens rBTC works in a similar manner to tBTCs node network by having the Ren Virtual Machine, RenVM, act as a trustless agent between the Bitcoin and Ethereum blockchains.

Lastly, sBTC is an ERC-20 version of bitcoin. But this time its backed by another token, the Synthetix Network Token (SNX). Each sBTC is not backed by BTC, but 800% of a BTCs value in SNX, the token for minting synthetic assets (Syns) on the Synthetix DEX.

The future of tokenized assetsThe wild success of BitGos WBTC and WETH (wrapped ether) may lead to more constructions of other coin holdings. Ben Chan, CTO at WBTC co-creator BitGo, told Coindesk in August that the firm was looking at wrapping other cryptocurrencies.

WBTCs 2020 success has largely been thanks to DeFi, he said.

What weve seen this year is that WBTC traction has been largely thanks to the highly composable DeFi industry, Chan said.

The ledger

CoinDesk Chief Content Officer Michael Casey took on thetheme of wrapped bitcoin in his weekly newsletter,Money Reimagined, last June. According to Casey, tokenized bitcoins bring not only value and legitimacy to a burgeoning decentralized financial ecosystem, but also security.

Likewise, Ethereum provides a clear path towards returns for tokenized bitcoin users, willing to take on extra risk.

DeFi double act

Tensions between the Bitcoin and Ethereum tribes have been stirred by a trend outsiders might see as a sign of harmony. Beneath the rivalry that plays out primarily on Crypto Twitter, the bitcoin-on-Ethereum trend says more about complementarity than competition.

The growth of tokenized representations of BTC highlights that bitcoin is the crypto universes reserve asset and that Ethereums burgeoning DeFi ecosystem is cryptos go-to platform for generating credit and facilitating fluid exchange.

Real-world parallelsThis trend captures the early beginnings of a new, decentralized global financial system. An analogy: Bitcoin is the dollar, and Ethereum is SWIFT, the international network that coordinates cross-border payments among banks. (Since Ethereum is trying to do much more than payments, we could also cite a number of other organizations in this analogy, such as the International Swaps and Derivatives Association or the Depository Trust and Clearing Corporation.)

So, lets dismiss claims like those of Ethhub.io co-founder Anthony Sassano. He argued that because bitcoin token transactions on Ethereum deny miners fees they would otherwise receive on the bitcoin chain, bitcoin is becoming a second-class citizen to ether. Youd hardly expect people in countries where dollars are preferred to the local currency to think of the former as second class. And just as the U.S. benefits from overseas demand for dollars via seigniorage or interest-free loans bitcoin holders benefit from its sought-after liquidity and collateral value in the Ethereum ecosystem, where it lets them extract premium interest.

Still, to declare bitcoin the winner based on its appeal as a reserve asset is to compare apples to oranges. Ether is increasingly viewed not as a payment or store-of-value currency but for what it was intended: as a commodity that fuels the decentralized computing network orchestrating its smart contracts.

That network now sustains its financial system, a decentralized microcosm of the massive traditional one. It takes tokenized versions of the underlying currencies that users most value (whether bitcoin or fiat) and provides disintermediated mechanisms for lending or borrowing them or for creating decentralized derivative or insurance contracts. Whats emerging, albeit in a form too volatile for traditional institutions, is a multifaceted, market for managing and trading in risk.

This system is being fueled by a global innovation and development pool bigger than Bitcoins. As of June of last year, there were 1,243 full-time developers working on Ethereum compared with 319 working on Bitcoin Core, according to a report by Electric Capital. While that work is spread across multiple projects, the size of its community gives Ethereum the advantage of network effects.

Whether DeFi can shed its Wild West feel and mature sufficiently for mainstream adoption, the code and ideas generated by these engineers are laying the foundation for whatever regulated or unregulated blockchain-based finance models emerge in the future.

Complexity vs. simplicityThere are legitimate concerns about security on Ethereum. With such a complex system, and so many different programs running on it, the attack surface is large. And given the challenges the community faces in migrating to Ethereum 2.0, including a new proof-of-stake consensus mechanism and a sharding solution for scaling transactions, its still not assured it will ever be ready for prime time.

Indeed, the relative lack of complexity is one reason why many feel more comfortable with Bitcoin Cores security. Bitcoin is a one-trick pony, but it does that trick keeping track of unspent transaction outputs, or UTXOs very well and very securely. Its proven security is a key reason why bitcoin is cryptos reserve asset.

Toward anti-fragilityThe inclusion of bitcoin in Ethereum smart contracts is inherently strengthening the DeFi system.

Decentralized exchanges (DEXs), which allow peer-to-peer crypto trading without centralized exchange (CEX) taking custody of your assets, have integrated WBTC into their markets to boost the liquidity needed to make them viable.

Meanwhile, the move by leading DeFi platform MakerDAO to include WBTC last spring in its accepted collateral has meant it has a bigger pool of value to generate loans against.

This expansion in DeFis user base and market offerings is in itself a boost to security. Thats not just because more developers means more code vulnerabilities are discovered and fixed. Its because the combinations of investors short and long positions, and of insurance and derivative products, will ultimately get closer to Nassim Talebs ideal of an antifragile system.

Thats not to say there arent risks in DeFi. Many are worried that the frenzy around speculative activities such as yield farming and interconnected leverage could set off a systemic crisis.

If that happens, maybe Bitcoin can offer an alternative, more stable architecture for it. Either way, ideas to improve DeFi are coming all the time whether for better system-wide data or for a more trustworthy legal framework.

Out of this hurly-burly, something transformative will emerge. Whether its dominated by Ethereum or spread across different blockchains, the end result will show more cross-protocol synergy than the chains warring communities would suggest.

At stake

Matt Luongo, founder of cryptocurrency venture production studio Thesis, wrote an op-ed discussing the similarities between stacking sats and decentralized finance. While hardnose bitcoiners may see DeFi as a distraction,Luongo thinks they should rethink their assertions.The article, published Oct. 1, is excerpted below.

Staking sats?

Bitcoins usefulness and grounding as hard money set it apart from most of the crypto froth from the past several years. The ocean of Ethereum white papers produced has yielded comparatively few working projects, and even fewer that anyone outside the crypto world would call usable.

Regardless of Bitcoins advantages, I am on record saying that I am a monetary maximalist, not a Bitcoin maximalist. I believe finance is a human right, just like speech and assembly, and that we need a fair and transparent financial system that empowers individuals, not powerful middlemen. So while I believe in the soundness of Bitcoin and its ability to help reshape finance, I will support any project that furthers this ultimate vision for a new economic system.

The fact that Ethereum is not Bitcoin, that it has consistently driven hype and bubbles, and that it still has not found a workable long-term solution for scalability, does not mean it offers nothing of value. In fact, Ethereums top DeFi platforms are doing some truly exciting and innovative work, and they have the promise to further the cause of a decentralized future of money.

MakerDAO operates like a credit facility, driving liquidity and encouraging more lending when interest rates are low. Compound, with its developer-focused interest rate protocols, enables the savings and loan functions of traditional banks. In more arcane spheres, projects like Synthetix offer a version of derivatives trading. Together, these platforms represent the germ of a new financial system.

Projects with names like $YAM and $TENDIES do not inspire confidence, I know. But dig a little into what DeFi is and does, and the foundations that have been laid, and youll be pleasantly surprised. DeFi is very real, and its worth exploring and explaining.

Stacking sats is about steadily, gradually, doggedly accumulating wealth over time. And DeFi is in the same spirit when properly implemented (never a sure thing in the Ethereum community). Its basic finance: DeFi lets people do things they already do through banks, mutual funds and other financial institutions. But done right, it offers these services in a way thats fairer, more transparent and more rewarding. So its not an exaggeration to say that DeFi is an ally in achieving a vision it shares with Bitcoin: a trustless world of democratized, self-sovereign finance.

It would be myopic and self-defeating to ignore the potential of DeFi to advance a goal that is, after all, shared by all of us. It would be even more self-defeating to ignore real opportunities to put money to work, like when theres a way for BTC holders to earn through cross-chain bridges like tBTC.

As Bitcoiners, we will always believe in the importance of sound money and in the Bitcoin blockchain as the best technology to facilitate it. There is plenty of risk in Ethereum and in DeFi. Potential investors must always do their due diligence. But Im here to tell you that DeFi is for real. Its a bubble, but its not just another bubble. And although there absolutely are DeFi platforms that will crash and burn, many of the concepts are sound. There are real opportunities for people to earn by putting their money to work and where thats true, investment and growth will follow.

Top shelf

Extortion claimsLocal government premises in Japan have beenhit by a flood of extortion attempts demanding bitcoin.According to a report by Japan Today on Monday, such threats have been received in at least 18 prefectures since July. The extortionists reportedly demand a payment in bitcoin to avoid the detonation of an explosive device in various public buildings, from schools to hospitals, though none of the Japanese victims have paid the extortionists, per Japan Today. Austria has also suffered a spate of similar bomb threats.

Compliance hireBitMEX, the cryptocurrency derivatives exchange recently charged by U.S. authorities, hashired an industry veteran to lead its compliance effortsgoing forward. In a blog post Monday, the exchanges operator 100x announced that experienced compliance officer Malcolm Wright will come aboard, reporting to the firms interim CEO and COO Vivien Khoo. This follows after news broke of a dual agency investigation into the firm for allegedly operating an unlicensed trading services.

Musk deniesElon Musk has thrown doubt on a claimed sighting of abitcoin ATM at the Tesla Gigafactoryin Nevada. Twitter user Will Reeves claimed on Sunday that he had just passed by and saw @elonmusk has a bitcoin ATM at the Gigafactory. The tweet was accompanied by a Google maps image revealing the location of the ATM on the northern side of the factory complex. Tesla founder and CEO Elon Musk said he didnt believe the claim was accurate in a tweet on Monday. Bitcoin ATM firm LibertyX confirmed with CoinDesk it has installed three traditional ATMs on site so employees can use their debit cards and buy bitcoin.

Little impactThe U.K. Financial Conduct Authoritys decision to ban individual investors from speculating on bitcoin and other cryptocurrencies is likely to have aminimal impact, partly because the market is so small, according to analystsand industry executives who track the trading business. Some U.K.-based brokerages that had offered the crypto derivative products to retail traders could see a drop-off in revenue, though big cryptocurrency exchanges including Kraken say the impact is likely to be minimal. While U.K. individuals can still trade the actual cryptocurrencies.

Digital yuanChen Yulu, deputy governor of Chinas central bank, said in an article at the weekend that thedigital yuan project should form an independent and high-quality elementof the nations financial infrastructure, South China Morning Post reports. Chen added that R&D for the digital yuan should proceed at a faster pace, while pilots should show the CBDC is controllable and safeguards the security of payments. Last week, the city of Shenzhen, together with the central bank, launched a kind of lottery allowing local residents to apply for some of10 million digital yuan that will be handed out.

Quick bites

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Cashfusion, the privacy-enhancing solution for the Bitcoin Cash network is nearing its one-year anniversary and during the last four months, fusions have increased by 328.93%. The protocol recently completed a security audit and fusions are nearing 20k with close to $200 million worth of bitcoin cash fused to-date.

On November 28, 2020, the Cashfusion protocol for the Bitcoin Cash (BCH) network will celebrate a milestone of one year operating so far. At the time of publication, stats from the web portal stats.devzero.be/#/fusion shows approximately 19,658 fusions have been processed since last November.

Four months ago, news.Bitcoin.com reported on the protocol exceeding $9 million worth of BCH fused and 4,583 fusions. Current data reveals that Cashfusion usage has jumped 328.93% since that report.

The increase in Cashfusion use jumped a great deal after the protocol completed a security audit from Kudelski Security. Alongside this, Cashfusion participation also increased when fusion tiers were expanded from 0.82 BCH to 8.2 BCH. The expansion allows for 10x a larger amount of bitcoin cash to be fused. Moreover, theres been 791,310 BCH fused to-date and using todays exchange rate thats $193 million worth of bitcoin cash.

Bitcoin Cash proponents are big fans of the Cashfusion protocol as they believe the software is more advanced than traditional coinjoin practices. For instance, data analyst James Waugh tested Cashfusion with thousands of transactions and found fusing is far more practical than other coinjoin methods. Waugh sifted through a number of transaction inputs and outputs and realized that its not possible to establish a concrete link between them.

This is because Cashfusion developers opted to remove the equal amount requirement traditionally found in coinjoin inputs and outputs. In a published a paper called Analyzing the Combinatoric Math in Cashfusion, Electron Cash developer Jonald Fyookball explains the process in great detail.

When James Waugh tested the claims of combinatorial anonymity and said that its impossible to determine the true way that inputs and outputs truly relate (since there are multiple possible combinations of ways of getting the inputs and outputs to balance).

In addition to the Cashfusion action rising, BCH supporters are still leveraging the Cashshuffle protocol as well. Cashshuffle was launched in March 2019 and also completed a security audit from Kudelski Security.

The web portal stats.cash/#/shuffle shows theres been 60,614 shuffles using Cashshuffle since its inception. In mid-September, shuffles dropped a bunch as more users started flocking to the Cashfusion protocol since the security audit and fusion tiers were expanded. Still, 271,962 BCH has been shuffled worth $66.5 million today.

What do you think about the Cashfusion protocols milestones after a year? Let us know what you think in the comments section below.

Image Credits: Shutterstock, Pixabay, Wiki Commons

Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.

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Cashfusion Use Increased by 328%, $200M in BCH Fused and Close to 20,000 Fusions | Privacy - Bitcoin News