This week the price of Bitcoin (BTC) dropped steadily from a near $9,600 high to a low of $9,275 before it started recovering. The cryptocurrency is now trading at $9,400, and is still range bound, looking to test the $10,000 mark.
Ether (ETH), the second-largest cryptocurrency by market capitalization, started the week at $220 and quickly moved up to $235, before moving back down to $225. Over the weekend it recovered and is now trading back at $235.
Miners on the Ethereum network have started increasing the network’s gas limit from 10,000,000 to 12,500,000, effectively increasing the number of transactions per second that the network can handle from 35 to approximately 44, in a bid to keep up with rising network demand. While Bitcoin has a fixed block size, the size of Ethereum’s blocks vary depending on the limits miners signal to the network, and can be adjusted by roughly 0.1% per block.
The Ethereum network’s capacity is being increased as there is growing demand for the cryptocurrency thanks to Decentralized Finance (DeFI) applications gaining traction. Over the week DeFi lending protocol compound started distributing its COMP governance tokens to users who interact with the protocol – by either lending or borrowing funds.
This saw the total value locked in decentralized finance surge from little over $1 billion to over $1.47 billion at press time, according to DeFi Pulse.
Users started both borrowing and lending using Compound to receive more COMP tokens, which according to CryptoCompare are now trading at $300 each. The value locked on Compound before tokens were distributed stood below $100 million, and now stands over $610 million. The surge helped Compound surpass MakerDAO in terms of value locked.
Demand for Ethereum may also continue to rise thanks to Reddit, as the social media platform rolled out Ethereum-based tokens, called “Community Points” to two popular communities this year, and has revealed that it’s looking to expand the feature to its 430 million users. To do so, it asked the Ethereum community for help, as it needs a scaling solution that can keep up, while giving users full ownership of their tokens and maintaining decentralization and other requirements.
In other Ethereum-related developments, leading ETH blockchain explorer Etherscan has launched a search engine for the decentralized web, supporting .crypto, .eth, and .zil websites. These are uncensorable websites hosted on the InterPlanetary File System (IPFS).
The webpages of these websites are hashed and stored by multiple nodes connected to the network, so if one node fails or gets blocked, others can serve the same data. The search engine launched with a database of only 150 websites but more are expected to be launched over time as more users take advantage of these uncensorable digital platforms.
Bitcoin ATMs Top 8,000 Worldwide While Investors Hold Onto Their BTC
The number of Bitcoin ATMs throughout the world, which let people buy and sell cryptocurrencies without registering on an exchange, is now above 8,000. Data shows, however, that 76% of these ATMs are located in the United States, with Canada coming in second with 788 (9.5%) of the machines installed. The remaining Bitcoin ATMs are spread out across 71 other countries.
While the number of Bitcoin ATMs keeps rising, data shows that cryptocurrency investors are holding onto their BTC. A report published by blockchain analytics firm Chainalysis shows that only 19% of bitcoin’s current supply is actively being traded, while 60% is being held as a long-term investment by users who never sold more than 25% of BTC they received.
The remaining 20% or so are considered lost to dead addresses that have not moved their funds in over five years. Curiously, the number of investors now holding at least 0.1 BTC has hit a new all-time high this week, at 3,054,282. A previous all-time high was seen on May 21 – suggesting accumulation is ongoing.
This new high was seen shortly after the U.S. Federal Reserve announced that, as part of its updated Secondary Market Corporate Credit Facility (SMCCF), it planned to start “buying a broad and diversified portfolio of corporate bonds to support market liquidity and the availability of credit for large employers.”