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Hodlnaut Refuses OPNX’s $30 Million Offer After FLEX Token Declines By 90%

According to the latest report, the interim judicial managers of beleaguered crypto lender Hodlnaut have rejected the latest acquisition bid proposed by OPNX. The OPNX exchange, affiliated with the founders of collapsed hedge fund Three Arrows Capital (3AC), offered to buy a significant 75% ownership stake in troubled Hodlnaut in August 2023.

Holdnaut, a Singapore-based crypto lender, was another of the numerous victims of the financial crisis that rocked the crypto space in 2022. The crypto company had to halt withdrawals after losing around $190 million to the Terra ecosystem’s crash.

Hodlnaut Says $30 Million Offer Has “Speculative Value”

According to a recent court filing reviewed by Bloomberg, Hodlnaut administrators have opted out of the acquisition deal of the crypto lending firm, arguing that the $30 million offer of FLEX tokens is “illiquid” and has “speculative value.”

Meanwhile, most of the crypto lender’s creditors, who account for 60% of the total debt, supported this decision. In the report, Bloomberg alluded that the FLEX price has declined by more than 92% since OPNX made the acquisition bid in early August. According to CoinGecko data, the FLEX token was valued at roughly $7 at the time of the offer. 

The cryptocurrency has been subject to extreme volatility lately, prompting its rise to $2.48 on Monday, September 18. However, the FLEX Coin has since undergone a significant price correction, with its current value at $0.584586.

FLEX is the native cryptocurrency of the CoinFLEX exchange, which stopped withdrawals and filed for restructuring in June 2022. OPNX was launched by CoinFLEX founders Mark Lamb and Sudhu Arumugam, explaining the connection between the OPNX exchange and the FLEX token.

Other Reasons For Rejecting OPNX’s Takeover Bid

Besides the concerns about the FLEX token and its “speculative value,” the Hodlnaut administrators put forward other questions on the OPNX’s $30 million offer. One of these issues is the “no injection of cash or assets with similar liquidity.”

Bloomberg revealed that the administrators implied liquid tokens such as Bitcoin and Ether. The court-appointed interim managers also questioned the absence of “a timeline for repayment of creditors’ debt” and that there were “no details of payment beyond 30% of liabilities.” 

It is worth noting that the involvement of the embattled Three Arrows Capital founders, Kyle Davies and Su Zhu, in OPNX’s takeover bid has always been a source of worry. Davies and Zhu are in a legal battle with 3AC creditors in the United States.

The Three Arrows Capital founders have also faced troubles outside the United States, with the Monetary Authority of Singapore (MAS) recently issuing a 9-year ban against them. This directive prohibits Davies and Zhu from engaging in regulated business activities in the Southeast Asian country.

Hodlnaut

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This New Development Could Stop The Optimism (OP) Price Dead In Its Tracks

Optimism (OP) looks to be on a good recovery path so far in the month of September. This is thanks to the increasing positive user sentiment around the Ethereum Layer 2 network. However, the most recent development on the network could pose a threat to this recovery trend.

Optimism Announces Third Airdrop

After completing two rounds of airdrops already this year, the Optimism network has moved on to its third airdrop. This time around, the network is looking to reward loyal Optimism users who have delegated their OP to be used to participate in governance on the network.

In its announcement, the team revealed that the latest iteration of its airdrop reward system would see 19 million OP tokens distributed to 31,000 unique addresses on the network. The airdrop distribution began on Monday, September 18, with the tokens being sent directly to the wallets of eligible users.

The requirement was to have delegated OP tokens between January 20 to July 20 to receive the airdrop. To sweeten the pot, the airdrop applies a 2x multiplier to those who had delegated their tokens to individuals who were active voters.

As for those who were ineligible to receive the latest round of airdrops, the team assured the community that more would be coming as 19% of the total OP token supply is dedicated to airdrops.

Will This Affect OP Price?

The value of the total OP tokens being distributed in the third airdrop comes out to around $26 million. This means that $26 million worth of tokens are making their way into the open market. Only half of the participants selling their allocation could see a $13 million selling pressure on the price of the digital asset.

Now, if there is not enough demand to suck up this new supply, then the sellers will win and the OP price will drop drastically. This is already being manifested in Optimism’s performance in the last day which is already moving into the red with 0.24% losses. As more users receive and access their tokens, the selling pressure could climb rapidly.

However, given that users are being rewarded for holding and delegating their tokens, it could spark an urge to hold onto the OP tokens among those who receive them in an effort to qualify for future airdrops. In such a case, the OP price will hold firmly and shake off any bear pressure.

OP is already seeing increased interest which has translated to a 40% increase in its daily trading volume, according to data from CoinMarketCap. Its price is also holding tentatively at $1.40 as investors wait for the market to react.

Optimism (OP) price chart from Tradingview.com

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Stellar To Release Protocol 20 Testnet Upgrade, Will XLM Rally?

On September 20, Stellar, a blockchain platform designed to facilitate fast and low-cost cross-border transactions using its native currency, XLM, will release the testnet upgrade of Protocol 20. With this launch, the protocol prepares for the eventual mainnet activation of the Soroban smart contracts platform.

Stellar Prepares For Protocol 20 And Smart Contracts

According to a document on September 18, the testnet upgrade aims to release candidate versions of Stellar Core and Horizon. Stellar is a blockchain network and relies on a network of nodes for transaction validation and to ensure the network is secure. Validators running are kept in sync using the Stellar Core since it acts as the backbone of the entire network, safeguarding the integrity of the blockchain. 

Stellar Horizon is an interface that simplifies interaction between applications and developers with the mainnet through APIs. By eliminating the complexities of interacting with the blockchain, Horizon makes it easier for users to deploy applications. 

Once the stable version is released, Validators will vote on the day when tested upgrades are integrated into the mainnet. The blockchain developer has acknowledged that the Protocol 20 upgrade will bring about new settings, which will require more discussion and adjustments through voting. The Stellar Network will provide a timeline for implementing these changes before rolling them out on the mainnet.

Soroban And The $100 Million Incentive

Stellar describes Soroban as a smart contracts platform designed for “scale and sensibility” and “integrates with and works alongside the existing Stellar blockchain.” The portal is currently being tested in Stellar’s testnet, Futurenet. 

Stellar claims that some of the network’s core features, such as multi-core scaling and an optimized fee model, make their smart contracts superior since all the “pesky serialization loops” have been eliminated. Unlike Ethereum layer-2 platforms like Arbitrum or Polygon, which operate separately, Soroban will fully integrate with Stellar and remain open source. 

The Stellar Development Foundation rolled out a $100 million Adoption Fund to incentivize Soroban adoption. This program, they explained, is an “umbrella for many programs that support all levels of Soroban adoption, some of which have launched and some of which have yet to launch.”

Stellar price on September 19| Source: XLMUSDT on Binance, TradingView

XLM prices are firm and have been one of the top-performing assets in the past three months. To illustrate, the coin surged from $0.08 in June and more than doubled, reaching $0.18 in late July.

However, the coin has since retraced, dumping by around 40%. However, the uptrend remains looking at the candlestick arrangement in the daily chart. Whether this upgrade will support XLM is yet to be determined.

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Bitcoin Sees Sudden Boost Amid Mt. Gox Rumors, But QCP Capital Targets $22,000

The cryptocurrency market, notably dominated by Bitcoin, has always been a terrain of speculation and market sentiment. Rumors and speculations have surfaced with Bitcoin’s recent slight uptick in value. Market insiders point towards the potential delay of the Mt. Gox repayments as a key driver.

However, QCP Capital, a crypto trading firm, remains skeptical about a sustained rally and holds a bearish outlook, indicating that global economic factors could play against the cryptocurrency.

Mt. Gox Delay Rumors Fuel Bitcoin Rally

Mt. Gox, the once-dominant Bitcoin exchange that faced a sudden downfall in 2014, is back in the news. With the April deadline for its creditors to submit repayment information having passed, there was an expectation of repayments by the end of October.

But recent rumors suggest a delay in this timeline to 2024. These speculations seem to have significantly influenced Bitcoin’s price dynamics. QCP Capital, in its market analysis, notes:

A large reason we’re seeing for this bounce is rumors of a Mt. Gox delay to 2024.

The trading firm believes many might have taken a short position expecting repayments soon, and any official delay announcement might spur a considerable short squeeze in the market.

However, the very nature of this rally has made experts cautious. Mt. Gox has a sizable cache of assets set for distribution, including 142,000 BTC (worth approximately $3.9 billion), 143,000 BCH, and 69 billion Japanese yen. Such a vast amount entering the market might create unpredictable price movements.

QCP Capital’s Cautionary Stance

Despite the recent price rally, QCP Capital’s forecast for Bitcoin remains bearish. The firm is still eyeing the $22,000 mark for BTC in the forthcoming month. They expect this uptick to be “short-lived,” with global risks looming over the cryptocurrency market in the fourth quarter.

Further dissecting the market movements, QCP mentioned:

The current Wave 2 of our C Wave expanded flat has so far bounced which we expected, but we still need to see the crucial Wave 3 that breaks the local lows for our count to be intact.

A break above $32,000 would invalidate their current assessment, according to the firm. While the imminent Federal Open Market Committee (FOMC) interest rate decision looms large, QCP sees a parallel to the market conditions of 2020, right before the infamous Covid crash.

Although there’s market speculation around a potential volatility squeeze, QCP believes that a pause in rate hikes by the FOMC is the more likely outcome.

But challenges persist, “At the same time, we do not see how Powell can assuredly call an end to this hiking cycle,” the firm adds, pointing to rising inflation and other economic factors. Additionally, concerns about a potential US government shutdown and increasing oil prices add to the economic uncertainty.

In QCP’s assessment, the stock market might witness a downturn without Federal Reserve intervention, potentially dragging Bitcoin with it. The firm concluded:

In such a scenario without Fed easing, equities will likely be down, taking Bitcoin down along with it until the Fed acts.

Bitcoin (BTC) price chart on TradingView

Featured image from iStock, Chart from TradingView

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PayPal’s PYUSD Report Provides Valuable Insight Into The Stablecoin’s Performance So Far

A new report has shown that the adoption of PayPal’s PYUSD stablecoin has seen less than favorable adoption rates since its inception. The crypto community remains skeptical about employing the new stablecoin for daily crypto payments and has opted for top competitor stablecoins like USDT and USDC. 

PYUSD Experiences Sluggish Adoption Rate

Global payments giant PayPal released its transparency report for its stablecoin, PYUSD, and the analysis of the report reveals that the PYUSD stablecoin may not be seeing as much adoption as PayPal and PYUSD stablecoin issuer, Paxos hoped for. 

Paypal launched the US dollar-backed stablecoin on August 7 which was designed to increase stablecoin offerings and facilitate the adoption of crypto payments to crypto users as well as consumers and merchants actively utilizing PayPal’s financial platform globally.

However, despite coming from one of the largest players in the payments space, the PYUSD stablecoin remains a relatively small player in the cryptocurrency market, especially when compared to industry heavyweights like Tether (USDT) and USD Coin (USDC).

A Kaiko analyst, Desislava Aubert stated to Decrypt that despite being listed on prominent exchange platforms like Coinbase and Huobi Global, the PYUSD stablecoin’s adoption rate has been progressing slowly, and its daily trade volumes have been fairly low. 

“PYUSD was listed on some centralized exchanges in late August, notably Coinbase and Kraken, but its daily trading volume has been volatile and significantly lower than other stablecoins. Overall, this points to sluggish demand,” Aubert stated. 

The PayPal USD stablecoin was issued by Paxos Trust Company, a technology company specializing in blockchain in August. Paxos has reported that it holds $45.3 million in assets supporting the PYUSD stablecoin. 

The stablecoin is also reportedly backed with over $1.5 million in cash deposits. The majority of the coin’s reserves, approximately $43.8 million have been collateralized with the US Treasuries as reverse purchase agreements. 

Currently, PYUSD has a market capitalization of $44 million, suggesting that the stablecoin’s adoption rate has been subpar due to its failure to catch and retain the attention of the crypto community. 

Crypto Investors Opt For Top Stablecoins

The decline in acceptance and adoption of the PYUSD may be attributed to the unfamiliarity of the cryptocurrency as a new stablecoin. The stablecoin market is also heavily saturated with well-established cryptocurrencies like USDT, USDC, and others. 

Given this, a large number of crypto investors are presently opting for these top stablecoins to facilitate their cryptocurrency transactions. This is further propelled by the fact that these stablecoins have created a considerable reputation for themselves over the years due to their reliability and sustainability.

Presently, USDT has a market capitalization of over $83 billion and USDC has a market cap of $26 billion. At the time of writing, USDT stablecoin’s 24-hour trading volume is over $22 billion as compared to PYUSD stablecoin’s 24-hour trading volume of only $3.2 million. 

Despite PYUSD’s sluggish adoption rate, PayPal remains committed to its cryptocurrency ventures. The payment giant has expanded into different regions globally using its brand name and reliable reputation as an international financial service provider to facilitate crypto adoption and awareness among users in different countries.

PayPal PYUSD price chart from Tradingview.com (Stablecoin)

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Bitcoin HODLers Not Selling, Will Number Break Record Highs?

The latest Glassnode data on September 18 shows that the percentage of Bitcoin supply held by long-term holders is close to an all-time high of approximately 76%. The expansion comes when the broader crypto market is recovering after crashing in recent weeks.

BTC long-term holders: Glassnode

The fact that the amount of coins owned by long-term holders is increasing could indicate a positive shift in sentiment. Long-term holders differ from speculators, who predict and gamble on price fluctuations for financial gain. Long-term holders are individuals or organizations that have kept their coins for at least 155 days. 

According to Glassnode, a blockchain analytics platform, the chances of these entities not spending after holding them for at least five months, is lower. Long-term holders, commonly known as “diamond hands,” can support crypto prices by removing coins from circulation.

More Entities HODLing

Bitcoin is inherently deflationary, and only 21 million coins will ever circulate. However, with mining, coins will be continuously added to circulation until all 21 million are mined by 2140. Presently, there are 19.49 million coins in circulation, of which a significant chunk is considered lost or irrecoverable. 

Satoshi Nakamoto, the United States government, and public companies like MicroStrategy hold another portion. According to public data, MicroStrategy, a business intelligence firm, is a publicly traded company HODLing the largest amount of Bitcoin. As of September 19, the firm had bought 152,800 BTC, roughly 15% of the total amount believed to be controlled by the Bitcoin founder, Satoshi Nakamoto.

Public companies holding BTC: Bitcoin Treasuries

Bitcoin Adds 10%, Bulls Optimistic

When writing, Bitcoin is up roughly 10% from September lows, recovering steadily from around the $25,200 support. Despite the uptrend and bulls gaining momentum, the path of least resistance, looking at the candlestick arrangement from a top-down preview, is bearish. 

Based on technical analysis, Bitcoin prices are still influenced by the August 17 bear bar, the conspicuous bear candlestick with high trading volumes and wide-ranging that forced prices below $28,000. 

Bitcoin price on September 19| Source: BTCUSDT on Binance, TradingView

Overall, Bitcoin prices are boxed within the June to July 2023 trade range, and buyers stand a chance as they bounce from key Fibonacci retracement levels. Presently, the medium-term buy target is $31,800 or July 2023 high.

Still, it is yet to be seen how prices will react in the days or weeks ahead. When prices trend higher, BTC HODLers will likely increase as more aim to ride the uptrend before taking profits. Meanwhile, investor sentiment could fall if prices pull back from spot rates, crumbling below $25,000 primary support.

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Here’s Where Next Bitcoin Resistance Lies, From An On-Chain Perspective

Here’s where the next major resistance to clear Bitcoin could lie from the perspective of on-chain analysis.

Bitcoin Resistances According To On-Chain Data

Bitcoin has recently observed a surge beyond the $27,000 mark, and many have been wondering how long this fresh rally could continue for the cryptocurrency. One way to determine this could perhaps be by looking at where the major resistance levels are.

In terms of on-chain analysis, “resistance” generally lies in regions where many investors have their cost basis present because of how holder psychology tends to work.

The “cost basis” here refers to the average price at which an investor buys coins. When the spot price is below a holder’s cost basis, they are in a net amount of loss.

Once BTC returns to the investor’s acquisition price, they may want to sell, as at least that way, they would have avoided exiting at any losses. Due to this reason, whenever a large number of investors have their cost basis present inside a particular price range, the range could provide resistance to the asset because of the volume of selling pressure that may arise in it.

Now, here is what the different Bitcoin price ranges look like in terms of investor cost basis concentration, according to data from the market intelligence platform IntoTheBlock:

Bitcoin Cost Basis

As displayed above, the following particularly thick cost basis range is $25,853 to $29,662. “Key resistance is anticipated around $29.2K — a point of acquisition for over 1.77M addresses,” explains IntoTheBlock.

The $27,200 to $28,000 range (the range just after the current spot price of the cryptocurrency) isn’t exactly thin, either, but it has notably fewer investors than the other one. The following range, $28,000 to $28,853, doesn’t have many investors, so if BTC can clear the upcoming range, the run-up to nearly $29,000 may be clear.

While investor cost basis can act as resistance on retests from below, they can also support when being touched from up. The reason behind this could be that an investor that had earlier been in profits might have reason to believe the asset would go up again, so they might buy more at their cost basis, thinking it to be a profitable entry point.

From the image, it’s apparent that both the ranges just below the current price are very thick with addresses because Bitcoin had earlier consolidated at these price levels for a significant time.

It might be due to these strong support levels that when the asset had retraced back to $26,600 yesterday, it quickly found a rebound to the current price level.

BTC Price

At the time of writing, Bitcoin is floating around the $27,200 level, up 4% during the past seven days.

Bitcoin Price Chart