Bitcoin Cash, Stellar Suffer Network Issues; Binance Returns; TD Ameritrade, eBay, Quash Crypto Rumors

Over the past day, the crypto space saw two well-known blockchains - Bitcoin Cash (BCH) and Stellar (XLM) - suffer network issues. Also, a week after its worst-ever hack, Binance resumed full functionality of its crypto exchange. We also heard TD Ameritrade and eBay each come out and deny what were fast-spreading rumors they were on the verge of entering the crypto industry.

Bitcoin (BTC) has hovered around the $8,000 mark for much of the past 24-hour period. At the time of writing, BTC is trading at $8024.3 (+1.23%). As for ether (ETH), it spiked to $262.2 (+12.4%), its highest price since September 5, 2018. Additionally, the MVIS CryptoCompare Digital Assets 10 Index is currently tracking at 3,698.1, a 4.9% rise over the past 24 hours.

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Bitcoin Cash, Stellar, Suffer Network Issues

After going through a planned system-wide update, the Bitcoin Cash network stopped processing transactions for various blocks, over what some claimed to be an issue with the Bitcoin ABC client. Eventually, developers released new code to fix a bug that had – until it was patched – resulted in a string of empty transaction blocks. The Bitcoin Cash blockchain has since resumed processing transactions normally.

Similarly, as broken by Tim Swanson via Twitter, the Stellar network also went down yesterday. The downtime lasted “for about 2 hours,” according to the Post Oak Labs director of research, who went on to note that “only those who run validators [would have] noticed it.” In explaining what happened, Swanson tweeted “that a critical mass of nodes went down causing a cascading failure and so the entire network went down but because it isn’t frequently used, few notices.”

Bolstered Binance Resumes Services

Binance announced it was back online after completing a security upgrade prompted by a data breach suffered early last week, which resulted in hackers stealing the equivalent of over $40 million in bitcoin.

Following the upgrade, Binance announced trading would recommence at 13:00 UTC, along with the ability for users to cancel open orders and process deposits. Despite the top-tier crypto exchange stating, “the withdrawal function will be available shortly after trading resumes,” this has yet to occur – at least entirely. According to the below tweet from Binance’s co-founder and chief executive Changpeng ‘CZ’ Zhao, withdrawals have been opened for most, but not all, tokens.



TD Ameritrade, eBay, Deny Rumours of Crypto Expansion

U.S.-based online brokerage firm TD Ameritrade and e-commerce giant eBay have quashed fast-spreading rumors they each were set to expand into the crypto space. With regards to eBay, a spokesperson told Bloomberg “cryptocurrency is not accepted as a form of payment on the eBay platform, nor is it part of [eBay’s] payments strategy.”

As for TD Ameritrade, the company’s head of digital assets told the news site “currently [TD Ameritrade is] not,” testing bitcoin and litecoin spot trading on its brokerage; referencing a (false) tweet on April 23 by Litecoin creator Charlie Lee.

The pair of now-debunked speculative stories coincided with the significant price run-up that took place in the cryptocurrency market earlier this week. News of eBay’s and TD Ameritrade’s expansions were widely thought to have contributed, at least in part, to the strong upward price movement.

CME Looks to Double Bitcoin Futures Limit, but Is This Wise?

The Chicago Mercantile Exchange (CME) has a new request for its regulator, as it looks to double open position limits on bitcoin futures contracts in the face of significant interest.

Nasdaq reports that the CME has already petitioned its regulatory body, the Commodity Futures Trading Commission (CTFC), asking for an increase from 1000 contracts per spot month to 2000 per investor. Each contract represents five BTC, so essentially, at its peak,  a single investor's total position may edge towards a monumental 10,000 BTC.

This is in direct response to the contract's recent growth which is currently depicting record levels of activity, citing $370 million being traded per day. A spokesperson for the CME noted that the idea to increase limits was proposed on the continued maturity of the market:

Based on the significant growth and acceptance of our financially-settled CME Bitcoin futures markets, as well as our analysis of the underlying bitcoin market.

However, as Nasdaq writes the increase in the upper limit of positions is somewhat superfluous. As of July, the number of open interest contracts reached an all-time high of just 6100; given this, it seems the CME may be future-proofing.

Open to Manipulation?

However, concerns remain about the limit increase, as without them, the potential for manipulation rises; often to the detriment to the underlying asset. Although, as per the CTFC website, the threat of manipulation from bitcoin futures contracts is "low":

In general, position limits are not needed for markets where the threat of market manipulation is non-existent or very low.

Instead, Nasdaq posited that this might point to a lessening on the CTFC's strict rule of bitcoin; as well as a maturing of the market in general.

Nevertheless, some believe the CME's bitcoin futures contracts do pose a significant threat to the price of BTC; with some suggesting that blatant manipulation continues unchecked within the market.

As reported, there seems to be a correlation between the expiry dates of CME bitcoin futures contracts and a lull in the price point of BTC. In several instances, a significant drop in bitcoin's price has coincided with a closure from the CME. The most recent example of this occurred on Labor Day, September 2, when bitcoin rose an extraordinary 8% shortly after the CME shut.

Crypto analyst, Alex Kruger, highlighted this, noting the large gaps which formed on the CME chart, from the price discrepancy before and after closing.

This has become a pretty accepted practice within the market. Kruger has even gone to the lengths of compiling statistics each time this phenomenon transpired:

On these occasions, bitcoin cited an average 4.6% price discrepancy following the close of the CME.

Whether this is a coincidence or the market is indeed being actively manipulated is as yet unclear. Either way, with the increase of these limits it might be only a matter of time until we know for sure.

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