Going Short: How Traders Profit From a Declining Cryptocurrency

TL;DR

Most cryptocurrencies experience extended periods of decline during a bear market, and can even draw down in value in a bull market. Because of this, traders opt to trade on the short side — predicting which cryptocurrencies will decline in value and netting a potentially handsome profit if correct.

With that in mind, we’ll take a look at seven methods that traders use to short a cryptocurrency.

• Trade Short/Inverse/Down Tokens - Short (also known as inverse or down) tokens are by far the simplest way to profit from a declining cryptocurrency. These are tokens designed to move in the opposite direction to an underlying cryptocurrency.
• Prediction Markets - Cryptocurrency prediction markets are platforms that allow users to wager on the outcome of future events, such as the Bitcoin price reaching $100,000 by December 31, 2024.
• Contract for Difference - A contract for difference, or “CFD” is a powerful financial instrument that allows traders to capitalize on cryptocurrency price movements by going either long or short.
• Binary Options - Cryptocurrency binary options are simple financial derivatives that allow traders to make a prediction on whether they believe an asset will go up or down in value by a specified time and date in the future.
• Margin Trading - Margin trading allows traders to borrow funds from a third party (such as the exchange or a liquidity provider) to open larger positions than their balance otherwise allows using leverage.
• Perpetual Futures - Cryptocurrency futures are a type of financial derivative contract that entitles the holder to buy or sell an asset at an agreed price at an agreed date.
• DeFi Short Selling - The concept is nearly identical to margin trading, as in that you borrow the cryptocurrency you want to short, sell it, then rebuy it at a later date (and hopefully lower price) to pay off your loan. But instead of using a broker, you take out a loan using one of the myriad DeFi lending platforms.

What’s your take on this? 😉

More details here: https://coinmarketcap.com/alexandria/article/going-short-how-traders-profit-from-a-declining-cryptocurrency

Ai Can Help Forecast Air Quality, But Freak Events Like 2023'S Summer Of Wildfire Smoke Require Traditional Methods Too #MENAFN #Bitcoin #LatestNews #BreakingNews

https://menafn.com/1106818073/Ai-Can-Help-Forecast-Air-Quality-But-Freak-Events-Like-2023S-Summer-Of-Wildfire-Smoke-Require-Traditional-Methods-Too&Social=on

Overview about CEX

So I figure for today's post, it would be interesting to look at the history and facts on CEX.

Note, CEX is a Centralized Exchange. So think of Kraken, Coinbase, and others like it.

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Historical:

Note I'm not getting into the complete history. There is A LOT of exchanges out there, and I wanted to highlight a few major ones.

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While the first crypto (BTC) was made in 2009. The first CEX was made in 2010. The first centralized cryptocurrency exchange was launched by Jed McCaleb under the name Mt. Gox. The following year in 2011 Bitstamp, Kraken, and a few others were made. In 2012 Coinbase was made.

In 2014 Mt. Gox filed for bankruptcy after losing 850,000 Bitcoins. Or what would be equal to today as in 2023, $25,488,950,000.

Skipping to 2017, Binance was launched in China, 2018 Coinbase became the first exchange to be valued at over $1 billion. And in 2019, Binance became the largest exchange by trade volume. In the same year, 2019 FTX was founded. And November 11, 2022 FTX went bankrupt due to illegal practices.

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Again this isn't a complete history. There is a lot of crypto exchanges out there, a lot of events, and I doubt anyone would want to read a complete history here.

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List of crypto exchanges:

I don't think most people understand how many exchanges there were and are. A good list is here, but note it isn't even a complete list. https://blockspot.io/exchange/

The list shows over 1,000 exchanges that are up and closed. Almost 925 of them currently online.

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Note there is other list which shows the fees and what not. But note that not all exchanges are to be trusted. As the saying goes

"Not your keys, not your crypto."

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Benefits to using a CEX:

A major benefit is it's a great way to on/off ramp. On top of this, many exchanges are extremely easy to use, you don't have to worry about transaction fees giving the crypto stays on the exchange, and with some exchanges it can be a safe way to test out crypto without having to learn about wallets and everything else.

Some exchanges even give rewards for learning or using the exchange like Coinbase's learn to earn.

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Downsides to using a CEX:

A major major major downside to all CEX is you are at their mercy. They can easily lock your accounts, lock your funds up, the exchange can get hacked, and so on. The reason for the saying, "Not your keys, not your crypto." It's because if you don't control the keys and aren't the only ones controlling the keys. Then you are at the mercy of whomever controls them.

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Another major downside is on some exchanges there is hidden fees, staking benefits could be a lot less, in some cases staking on exchanges doesn't mean the exchange is actually staking the stuff. Kraken, a highly beloved exchange of this sub even got in trouble for this. On some exchanges there is hidden fees when you withdrawal. A number of exchanges artificially slow down transactions going off the exchange.

Random rule changes or things can lock your funds up. For example, if you move crypto from a gambling site to Coinbase, this will lock your account down. Where if you move it to your wallet and then Coinbase they ignore this. My point is, you are at the mercy of the CEX personal moral and ethic police.

CEX are highly targeted when it comes to government bodies wanting information. CEX are highly targeted when it comes to cyber security. If someone tricks the CEX, they can get access to your funds. Every time you have to do the KYC stuff if you get locked out, lose your 2FA ability, etc. More eyes are on your personal information.

What’s going to happen to Bitcoin this week

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What’s going to happen to Bitcoin this week

Weekly feature: our experts analyzed the market situation and told how it may change in the short term for Bitcoin

The week from July 31 to August 6 was relatively quiet. The BTC/USDt pair traded in the range of $28,585 – $30,047. Increased volatility in the market was observed on August 1 and 2. On August 1, the price of Bitcoin fell to $28,585. The market was pressurized by fears of regulatory action by the Securities and Exchange Commission (SEC) regarding the crypto projects Hex, PulseChain and PulseX. The hack of the Curve crypto exchange was also negatively impacted. And as a result of which hackers stole about $50 million. Despite the fall in quotes in the first half of the day, the daily candle closed with growth at $29,705.

On August 2, Bitcoin was recovering to $30,047. There are two reasons that may have provided support for buyers:

The first one is the release of MicroStrategy’s Q2 2023 report. The company made a profit for Q2 and purchased 12,333 BTC. As of July 31, the company owns 152,800 BTC. The total BTC purchase price is $4.53 billion at an average price of $29,672 per 1 BTC.

Second – Fitch Ratings downgraded the U.S. sovereign credit rating from AAA to AA+ due to a growing budget deficit and a buildup of government debt. The downgrade had a limited impact on the markets. And since with such debt it is an expected event. U.S. government debt service has nearly reached $1 trillion a year. At this rate, debt interest payments will soon become a major spending item in the U.S. budget. Hardly anyone will repay the debt. The share of the dollar is declining in international settlements and in central bank reserves. No matter what anyone says, U.S. bonds are becoming toxic.

Analysis of other factors

Friday’s U.S. labor market data points to a continued slowdown in job growth. 187,000 jobs were created in July. And that is below forecasts. And the figures for June were revised downward to 185k. That’s the smallest job gain since December 2020.

Although the unemployment rate has fallen. And wages have risen, the low rate of job growth suggests the labor market is gradually cooling under the influence of the Fed’s tighter monetary policy and a slowing economy. Companies are cutting back on hiring because of rising costs and an uncertain outlook.

Overall, the data points to weakening employee attitudes and cooling labor demand. This could have a dampening effect on inflation and cause the Fed to slow the pace of rate hikes. Nevertheless, the labor market remains relatively resilient despite the slowdown.

Despite a relatively quiet week in terms of economic events, the key indicator will be the U.S. Consumer Price Index (CPI), which will be released on August 10. It will give an indication of the inflation rate and could affect the US Dollar’s performance and the Fed’s monetary policy expectations.

The dollar ended last week on a weak note after a five-day rally. And the question is whether it was a correction of the uptrend or the beginning of its reversal. Overall, the US inflation report will be a key benchmark in the coming week to understand the outlook for the dollar and monetary policy. Bitcoin did not take advantage of the dollar’s weakness, and that’s a bad thing, as its rebound and a decline in U.S. stock indices could bring down the market more.

Buyers’ activity in the crypto market is low due to fears of a new market crash

The U.S. Attorney’s Office is preparing charges against Binance. However, it fears that it may provoke a massive outflow of user funds, as in the case of the bankrupt FTX.

DOJ officials are rumored to be concerned that filing criminal fraud charges against Binance could cause panic. And mass withdrawals by customers, causing them to lose money and destabilize the entire cryptocurrency market.

Therefore, prosecutors are considering alternative options to punish Binance, such as fines, deferred prosecution, or a settlement agreement. This would avoid a harsh reaction from investors and negative consequences for the industry. A decision on what charges will ultimately be brought against Binance has not yet been made and is under review by the US Department of Justice.

Prospects

Our experts note that despite the local recovery, buyers failed to gain a strong foothold above $30 th. The price Bitcoin stabilized around $28,950, where it traded until the end of the week amid the absence of positive triggers. The key support level is the $28,250 mark. If the trend line from the low of $16,333 does not hold. The risks of falling to $25,250 will increase sharply. According to seasonal cycles, the bearish phase should last until September. BitRiver estimates that Bitcoin needs to break through the resistance at $30,500 for the situation to turn bullish.

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Core Web All-In-One Command

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The Best Way to Connect to Web3 | Core

Core Web, developed by Ava Labs, is an all-in-one command center designed to provide a seamless and intuitive user experience for the Avalanche network, Avalanche Subnets, and Ethereum. It is part of the Core product suite, which also includes the Core browser extension and Core mobile. Here are some of the key features of Core1. Bridge: This feature allows users to transfer and use native Bitcoin and Ethereum tokens (ERC-20) on all Avalanche dApps. source

1. Swap: Users can trade tokens on Avalanche and Ethereum without ever leaving source
2. Buy: This feature enables users to go from cash to crypto in minutes. source
3. Unify: Users can view and manage NFTs and digital assets across multiple networks. source
4. **Control feature allows users to own their identity and automatically switch across Avalanche, Ethereum, and any EVM-compatible network. source
5. Search: Users can explore and seamlessly transact with Web3 addresses on chain. source
6. Discover: This feature helps users track the latest Avalanche ecosystem news, events, and projects. source
7. Stake: Core it easy for users to stake assets directly to. source

To with Core, you can download the Core extension from the [Chrome Web Store](https://chrome.google.com/webstore/detail/core/agoakfejjabomempkjlepdflobhb then visit core.app to experience Avalanche and Web3 like never before.

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Was banned on Stake After Losing almost everything

I got to plat 3 in 3 days and half way to plat 4 I had over 1200 raffle tickets for this weekends $75,000 event and was down over 5 Bitcoin. I sent stake an email about how gambling wasn’t for me and I felt I was heading in a down spiral and asked if I could have some of the btc back, they instantly self excluded me forever and locked some of the funds I had on the account and wouldn’t take the self exclusion off. Said all my raffle tickets were invalid now (raffle tickets would have made me 5k-10k easily depending on luck) and my reload amount every day was $157 usdc) and I got the monthly 6th birthday reward and it was 1,500usdc . I felt I got scammed hard and I should at least be able to self exclude myself if I wanted but not instantly banned after the email. I did get chat gpt to write the email and I guess it did sound like a was struggling with gambling but the reason I sent them the email was to hopefully receive some of the Bitcoin I had lost back. Not to be permanent and instantly band/self excluded without being told. Is there anything I can do at all to recoup some of the Bitcoin or at least have my account back so I can use all the raffle tickets to win one or more of the 15 chances to win $5k of the $75k weekly challenge. Is there anything I can say to them to change their mind. Btw 5btc is a huge amount for me, accumulated it since early 2020. Also was a good session but I get too greedy was playing rip city at one point was doing over $1.2k spins and managed to have a few $50k plus hits from free spins and got the balance over $100k before chasing lost Bitcoin and having dead or wild drain 30k non stop till bust lol. Please give input and opinions. And yes I will be stopping gambling/have stopped gambling

6 years ago, we had the first Bitcoin fork where BTC forked to BCH. Now 6 years later, BCH is down 95% against BTC. An integral part of Crypto history nonetheless.

Just about 6 years ago from today there was a historic event for Bitcoin and all of Crypto history. On the 1st August 2017, BTC splitted into BTC and BCH, the first Bitcoin fork. Later on BCH also splitted into BCH and BSV in 2018. A hard fork means that a blockchain network splits up into a new and an old version, reasons for that have usually been conflicts in the developer team and it was actually the same with the BTC-BCH hardfork.

Here there were conflicts of rather having larger mining block for BTC and thus having cheaper fees and faster transactions (BCH) or just keep it at the smaller blocks (BTC). So, was it really worth it?

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Article of The Forbes just days after. fork and BCH price chart since its fork, picture from Pete Rizzo on Twitter (X)

While BCH still stays as the 17th Crypto ranked by market cap (and BSV is at 57th), it is still down a whopping 95% against BTC since its fork and generally down 94% from its ATH of over $1.1k in 2017 to now a price of $228. So looking at the numbers, it certainly was a failure and could never even narrowly come close to giving the actual BTC competition.

Just a small disclaimer at the end, BCH even if after the numbers has lost, this post should be no disrespect for their quite big community it has gathered over the years and the fact that it is under active development and can actually be used for low-fees and fast transactions. (unlike the Craig Wright aka Faketoshi scam of BSV)