First Mover: Litecoin and Mimblewimble, Ether Futures, Chainlink, Curve

Price Point

Bitcoin was mostly subdued over the weekend, staying in its recent range between $11,000 and $12,000. Ether, trading around $430, is looking to extend a run of four straight weeks of gains during which prices have nearly doubled. 

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Market Moves

Hope Springs Eternal for Underperforming Litecoin as Mimblewimble Nears – By Omkar Godbole

The cryptocurrency litecoin (LTC) is often referred to as the silver to bitcoin’s gold. This year, litecoin investors would have been better off staying in the analog world: While bitcoin (BTC) has gained twice as much as gold, litecoin has only recently caught up with silver.

Some investors now foresee a rally developing in litecoin prices, with a key upgrade looming and signs that activity is increasing on the  blockchain network.

The upgrade is to add a “privacy protocol” known as Mimblewimble, which is supposed to help shield the identities of holders of senders and recipients of litecoin tokens while also improving the network’s processing capacity. A testnet of Mimblewimble, in the works for almost a year, is targeted for implementation by the end of September. 

And based on market data, it appears the looming addition is generating enthusiasm among users: Daily confirmed transactions on litecoin’s blockchain has more than doubled this year, reaching a 7-day average of 48,948 last week, the highest since February 2018, according to data source Glassnode. 

Litecoin backers hope the token’s added privacy features from the Mimblewimble upgrade will help attract users who otherwise might gravitate toward existing privacy coins like monero (XMR) and zcash (ZEC). Those tokens come with their own risks, such as the potential for holders to get diluted by new issuance. 

The speculation is the upgrade could help litecoin, which has gained about 50% this year to $63, catch up with bitcoin’s 64% increase. 

“Litecoin’s upcoming Mimblewimble upgrade has led to a spike in transactions and active addresses,” said Matthew Dibb, co-founder of Stack, a provider of cryptocurrency trackers and index futures. 

For a longer version of this article online, click here. 

Bitcoin Watch

Although bitcoin appears stuck in a narrowing price range, investor interest in futures on the Chicago Mercantile Exchange (CME), a sign of increased institutional demand, continues to grow. 

Open interest on the CME, or the number of outstanding contracts, rose to a fresh record high of $864 million on Friday, topping last week’s record of $841 million, according to data source Skew. The CME has recently climbed in the ranks to become the third-largest bitcoin futures exchange by open interest. 

Growth in futures trading volume, however, has stalled over the past two weeks, which might actually be bullish: A combination of rising open interest and low volumes usually indicates investors are holding on to their positions. Typically when that happens, the market continues its prior trajectory, which in this case was up.  

So bitcoin could break out of the current price-consolidation pattern, represented by an ascending triangle on the daily chart, with a convincing move above $12,000. That breakout, if confirmed, would imply a continuation of the rally from July lows below $9,000 and open the doors for stronger gains. At press time, bitcoin is changing hands at $11,870 on major exchanges. 

– Omkar Godbole, Markets Reporter

Token Watch

Ether (ETH) futures hit new record – Investor interest in ether futures and options hit a new peak on Friday as the cryptocurrency’s price rose to 25-month highs. Open interest in futures or total value of outstanding contracts rose to a record high of $1.73 billion on Friday, according to data source Skew. Prices for the token have more than tripled this year to about $430. 

Chainlink (LINK) developers taking profits? – According to the website Trustnodes, Chainlink developers have sold some $40 million of link tokens this month. Trustnodes, citing its own analysis, said about 500,000 of the link tokens are getting sent every week to the cryptocurrency exchange Binance and other venues . The “oracle” token has become a darling in cryptocurrency markets in 2020 because of its perceived potential for fast-growing “decentralized finance” trading and lending systems. The token is up 10-fold this year, the top performance by far among digital assets with a market value of at least $1 billion. 

Curve (CRV) debuts early in another nutty DeFi moment – After the frenzy earlier this week in Compound’s COMP tokens and last week’s madness in YAM tokens, it’s anybody’s guess how the newest token from decentralized finance, or DeFi, will perform in its early days. In this case, the nuttiness has already begun: According to CoinDesk’s Colin Harper, an anonymous DeFi user late last week deployed Curve Finance’s Decentralized Autonomous Organization (DAO) and token smart contracts without the team’s permission . Following the deployment, Curve Finance tweeted it had “no choice but to adopt it,” saying in another tweet it appears “to be an acceptable deployment with the correct code.” Here’s what trading in the token looks like so far, per CoinGecko:

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– Sebastian Sinclair, Reporter