Crypto in View: Bitcoin community split and a recap of the week’s crypto events

crypto spring and the civil war in the Bitcoin community. Today’s article gives you a quick recap of the digital drama in the crypto-verse.

Crypto in View: Bitcoin community split and a recap of the week’s crypto events
Crypto in View: Bitcoin community split and a recap of the week’s crypto events

In the past few days, the crypto industry has experienced some notable events, the first (and most obvious) being the price of Bitcoin that is giving every trader the feeling of a crypto spring and the civil war in the Bitcoin community about the ordinal inscriptions.Today’s article gives you a quick recap of the digital drama in the crypto-verse. Let’s dive in!

Is Bitcoin going to 50k?

This week, over $200 million in Bitcoin short positions have been liquidated, leaving bears traumatized as the golden digital asset skyrocketed in price. Analysts have predicted that the next stop will be $50,000. Bitcoin sentiment tracker, Augmento has shown a rise in bullish topics about $BTC and crypto on X (formerly known as Twitter). This is buttressed with the rumours of a Bitcoin Spot ETF getting listed soon; many analysts consider this a major catalyst to the bull season as a spot ETF would allow non-crypto-centric investors to gain exposure to Bitcoin without bearing the initial risks. Another bullish sentiment is the rise of Ordinal inscriptions and BRC-20 tokens, as well as the forthcoming Bitcoin halving on April 17, 2024. According to blockchain news firm, Cointelegraph, Bitcoin options open interest crossed a milestone of $20.5 billion on December 7, which gave a bullish signal to the crypto community and confirmed the active involvement of institutional investors.

We’re feeling optimistic” – Sonnenshein

Grayscale Investments CEO, Michael Sonnenshein, has expressed his ‘optimistic’ feeling about conversations his firm has had with the United States Securities and Exchange Commission concerning the potential listing of a spot Bitcoin ETF.

“We have been actively engaging with the SEC. The questions that we’re getting from them signal to us that they want to engage on this issue, that they’re eager to make progress on this issue.” – Sonnenshein.

Grayscale is not the only firm lobbying for a spot Bitcoin ETF approval, other firms like BlackRock and Fidelity have also expressed their interest and have made multiple filings to the SEC. SEC Chairman, Gary Gensler has clearly stated his critics against crypto, noting that the system encourages fraud, money laundering and market manipulations.

“It remains a matter of when not a matter of if” – Sonnenshein.

Binance CEO, Richard Teng claims that Binance is financially strong

On December 1, Richard Teng, the new CEO of the world’s largest exchange, Binance, held an hour-long AMA on X (formerly known as Twitter), tending to the pressing questions of the users. During the AMA, Teng was asked if Binance could afford the fines levied against it.

“We’ve seen many community members asking about the fines that have been in the news recently. Can Binance afford the fines?”

Teng began with the assurance that Binance is a profitable venture and stands as the largest crypto exchange globally in terms of volume.

“My assurance is: don’t worry. We are in very strong financial shape; the fundamentals of our business are very strong. We have been profitable almost from day one and have remained profitable since. We are still by far the largest crypto exchange globally in terms of volume. Our users trust us because of our consistency over the past six years. At every instance, we look out for users.”

He went further to cite that the U.S agencies never alleged that Binance misappropriated customers' funds, noting that users' funds are backed one-to-one, and users can choose to withdraw 100% of their funds at any point in time.

“Users have been overwhelmingly positive about all this, and we have been honored to see an outpouring of support. We have more users signing up with us now than ever before – 166 million by now. Those fines are not an issue. We will continue to push ahead. Our expenses are modest, and we have robust profits and revenue” – Binance CEO Richard Teng.

Inscriptions are exploiting Bitcoin Core vulnerabilities

Core Bitcoin developer Luke Dashjr has expressed his opinions about the ordinal inscriptions and how they spam the Bitcoin network due to a Core vulnerability. This might have been because of the increasing number of unconfirmed transactions on the Bitcoin blockchain and eye-watering transaction fees.

“PSA: “Inscriptions” are exploiting a vulnerability in Bitcoin Core to spam the blockchain.” Luke Dashjr.

BRC-20 (an experimental fungible token standard for ordinal inscriptions) has attracted so much attention from the crypto community that some consider it a way to integrate DeFi into the Bitcoin network. The most popular BRC-20 token, $ORDI, currently sits at a market capitalization of $1.08 billion.

According to The Block, the concept of inscriptions is spreading to other blockchains besides Bitcoin. Chains like Avalanche, Celo, and Fantom have over 20 million inscriptions on their networks, while in Polygon (where it is called PRC-20), there have been over 100 million inscriptions. Tron founder Justin Sun has also asked his community on X (formerly known as Twitter) about integrating inscriptions and BRC20 with the Tron Network

“I’d like to hear your thoughts on four key initiatives: firstly, enhancing the inscription support for Tron; secondly, integrating Tron with BRC20; thirdly, launching a $100 million Tron developer fund; and fourthly, reducing energy costs to attract more developers and users to Tron.”

While these might give the impression that BRC-20 and inscriptions are the next big thing, the major concern can’t be ignored. As more inscriptions are created, there will be a huge spike in a blockchain’s network activities, which could lead to slower transaction confirmation times and high gas fees. Bitcoin inscriptions have been around as far back as March, but in May, even top crypto exchanges like Binance had to pause withdrawals because of the compounding pending transactions and the skyrocketing fees.

“Bitcoin Core has, since 2013, allowed users to set a limit on the size of extra data in transactions they relay or mine. By obfuscating their data as program code, inscriptions bypass this limit. This bug was recently fixed in Bitcoin Knots v25.1. Bitcoin Core is still vulnerable in the upcoming v26 release. I can only hope it will finally get fixed before v27 next year.”