A healthy recovery or is the worst yet to come?
The blockchain surveillance firm Chainalysis published a research report that shows that BTC spending has significantly dropped in the last month. The researchers say the global pandemic, economic crisis, and crypto market flash crash had an adverse effect on crypto spending habits, even though many people are stuck at home due to lockdowns and quarantines.
The number of confirmed transactions per day fell from 350K to as low as 210K during the price dip, but has since recovered to more than 270K daily transactions. Additionally, Bitcoin’s hashrate has started to recover after its significant drop from 123 million TH/s to 94 million TH/s, caused by miners turning off old hardware. This happened because Bitcoin mining profitability fell with the market crash.
Some experts worry that if the BTC price doesn’t recover quickly, more miners will turn off their hardware because of the block mining reward halving in May. A very low profitability could consolidate hashrate into the hands of a small group of privileged miners who have access to cheap energy. That could make the network vulnerable to an attack from a well-funded adversary, such as a hostile nation-state.
Reminder: the Bitcoin’s block mining reward halves every four years. The block reward will decrease from 12.5 to 6.25 BTC per block in May. Historically, previous halvings preceded bull-runs.
Cryptocurrencies are performing better than many other assets during the 2020 financial crisis
A report published by Binance Research found that Bitcoin had an unusually high correlation with the S&P500 stock market index in the first quarter of 2020. This can be explained by the colossal sell-off triggered by the ongoing global health crisis and financial meltdown, during which all asset prices fell down sharply, except for long-maturity US Treasury bonds (+23%) and gold (+8%). The worst quarterly performing asset included in the report was crude oil (-66%).
Even though cryptocurrencies didn’t retain or increase in value amid the economic downturn, they’ve already outperformed many other assets during the same time period, despite the wild ride on March 12.
In other news
Kenya has become the first African country to make 5th place in LocalCryptos monthly trading activity. Since the start of 2020, the number of daily Kenyan trades on LocalCryptos has grown by more than 300%.
The alert key has been used to temporary disable trading on a peer-to-peer crypto marketplace Bisq due to a critical security vulnerability involving the theft of $250,000 worth of Monero and Bitcoin.
#CryptoAgainstCOVID initiative was launched by Binance Charity Foundation to mobilize the crypto community to donate money to fight against the novel coronavirus. Many cryptocurrency-related companies joined the initiative.
11 class-action lawsuits were filed in the US District Court for the Southern District of New York against several cryptocurrency and blockchain companies, including Tron, Binance, Bitmex, Block.one, KuCoin, Quantstamp, and others. The suits allege that these companies sold illegal securities to US citizens.
After more than 18 months of work, a series of updates, called the Byron reboot, were launched on the Cardano network. The updates raised Cardano’s transactions-per-second (TPS) capacity and prepared the blockchain for the Shelley era.
Brave browser, which combines privacy features with blockchain-based advertising platform, has reportedly added more than one million new users in March, according to its head of marketing.
April 5 was the apparent birthday of Satoshi Nakamoto, according to his profile on the P2P Foundation website, and it also the day when Americans were forbidden from hoarding gold in 1933.