8x More Profitable to Mine Bitcoin than All Other Cryptos: Report

Miners on the Bitcoin (BTC) network were paid a record $580,000 in mining fees, or rewards, during a 24-hour time period on May 10th, 2019.

This, according to data shared by Messari’s OnChainFX rankings, which revealed that bitcoin miners managed to earn over 8x the transaction fees than miners on all other major crypto networks (combined).

ETH Miners Earn $68,000 In TX Processing Fees

In second place, Ether (ETH) miners earned 88% less in transaction (TX) processing fees when compared to bitcoin miners. In total, mining Ether generated around $68,000 in TX fees on Friday (May 10th, 2019). Meanwhile, Litecoin (LTC) miners earned only $1,100 (in total) in TX fees.

The seven other cryptocurrencies tracked on the OnChainFX site, including Bitcoin Cash (BCH), Monero (XMR), Dash (DASH), XRP, Dogecoin (DOGE), Lisk (LSK) and Ethereum Classic (ETC), earned miners less than $1,500, in total, in TX fees.

More Bitcoins Traded Recently Than Ever Before

Notably, more bitcoins were traded recently (on May 12th, 2019) than any other day in the pseudonymous cryptocurrency’s history. Over $29 billion in bitcoin trading volume was recorded on May 12th. The previous high for 24-hour BTC trading volume was set on January 8th, 2018 - when the world’s most dominant cryptoasset registered more than $25.5 billion in 24-hour trades.

As cryptocurrency prices have begun to surge, it appears that the extended bear market, which lasted throughout 2018, may have come to an end.

Bitcoin Will Account For “A 5% Market Share Of The Earth”

According to legendary billionaire venture capitalist, Tim Draper, Bitcoin will represent around “a 5% market share of the Earth.” Draper, whose comments came during the SALT Conference, held recently in Las Vegas, Nevada, believes that Bitcoin will be far more valuable than it is today. This, as the cryptocurrency is “decentralized, open, [and] transparent” - which makes it a “better currency” than all other fiat currencies, according to Draper.

On May 10th, the Canaccord Genuity Group, a Toronto-based multinational, full-service investment bank focused on “growth companies,” predicted in its report that the price of bitcoin will surge to $20,000 by 2021.

The firm’s report was based on bitcoin’s price movements during the four-year time period from 2011-2015 and from 2015-2019. Additionally, Canaccord’s report took into account the halving of bitcoin mining rewards (every 4 years), which could potentially affect the cryptocurrency’s price.

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.

Featured Image Credit: Photo via Pixabay.com