Bitcoin Retreats | Ethereum Completes Upgrade

Inflows into new ETFs are driving the bitcoin run.

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Nina Bambysheva Staff Writer, Forbes Money & Markets
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Steven Ehrlich Director, Forbes Digital Assets
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BITCOIN PULLS BACK FROM LATEST ALL-TIME HIGH

Persistent U.S. inflation and a bout of forced liquidations at the end of the week took some of the wind out of the sails of a cryptocurrency market that had gained 63% this year through Tuesday.

Bitcoin, which accounts for 49% of the crypto total was down 1.8%
on Friday afternoon at $70,172 after briefly falling below $66,000 earlier in the session. Just the day before, bitcoin soared to a new
all-time high above $72,000.

Traders were reacting in part to U.S. government reports of
inflation at the consumer and wholesale levels that was higher than economists had expected. The persistent upward pressure on prices is seen as delaying a start to a series of Federal Reserve interest-rate cuts that would be beneficial for crypto. In addition, approximately $700 million worth of crypto bets made on margin was force liquidated in the past 24 hours—the most in nearly two weeks, according to data from Coinglass.

Still, bitcoin remains more than 60% higher year to date, helped
by a frenzy driven by flows into U.S. spot exchange-traded funds. In a nod of confidence to the bull run, software firm MicroStrategy said it is planning to raise capital through a convertible bond offering to add to its trove of the tokens for the second time in less than 10 days. In a March 11 filing, the company said it held about 205,000 bitcoin acquired at an average price of $33,706. At the Friday afternoon price, that hoard is worth $14.4 billion.

The company’s shares, which function as a closed-end bitcoin fund,
rose 6.3% on Friday to $1,782.36, which was up from $631.62 at the end of 2023.

The total value of all cryptocurrencies was $2.739 trillion late on Friday, down from $2.892 trillion on Tuesday.

ETHEREUM UPGRADE CUTS COSTS FOR LAYER-2s

On Wednesday, Ethereum rolled out its most significant upgrade in over a year, dubbed Dencun, designed to cut transaction fees for
Layer-2 blockchains that operate atop what is considered the world’s
second-most-valuable blockchain.

These networks, also referred to as rollups, autonomously process transactions and synchronize with the main Ethereum network at intervals. Traditionally, they stored data directly on Ethereum, leading to a memory burden that constituted approximately 90% of their operational costs. These costs were then passed on to developers and consumers of applications that run on the blockchain.

To address this challenge, an upgrade introduced a temporary data
storage method called blobs. The blobs retain data for about three
weeks—sufficient time for retrieval if needed to verify transactions—while alleviating the storage burden.

CURRENT PRICE OF TOP 5 COINS (7-Day % Change)

Coin

Price

Percent Change

Bitcoin (BTC)

$68,262

1.4%

Ether (ETH)

$3,670

7.2%

Tether (USDT)

$1.00

0%

Binance Coin (BNB)

$592

21.8%

Solana (SOL)

$179

21.8%

Sources: Forbes Digital Assets, CoinGecko. Prices as of 6:00 p.m. on March 15, 2024.

CRAIG WRIGHT IS NOT SATOSHI

The U.K. High Court has declared that Australian computer
scientist Craig Wright is not Satoshi Nakamoto, the mysterious creator of bitcoin. “The evidence is overwhelming,” said Justice James Mellor, delivering a ruling at the close of the six-week trial. “First, that Dr. Wright is not the author of the Bitcoin white paper. Second, Dr. Wright is not the person who adopted or operated under the pseudonym Satoshi Nakamoto in the period 2008 to 2011. Third, Dr. Wright is not the person who created the Bitcoin system. And fourth, he is not the author of the initial versions of the Bitcoin software,” he said.

The lawsuit was initiated by the non-profit Crypto Open Patent
Alliance (COPA), which sought to prevent Wright from perpetuating his claim of inventing bitcoin and using it to expand his influence within the sector. The group’s expert witnesses said they found hallmarks of backdated edits, created or altered using versions of software that did not exist at the time the documents were supposedly made. Notably, traces of ChatGPT’s involvement were found in one
document; the artificial intelligence software was only released in 2022.

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