What happened

As the world's second-largest cryptocurrency, Ethereum (CRYPTO: ETH) generally dictates the way that many Ethereum-related tokens perform on any given day. Such is the case today, with Ethereum, Ethereum Classic (CRYPTO: ETC), and Lido Staked Ether (CRYPTO: STETH) all surging within a relatively tight band. As of 11:45 a.m. ET on Wednesday, these three tokens had risen 13.3%, 10.3%, and 13.2%, respectively, over the past 24 hours.  

These moves come on the heels of some rather impressive liquidation data for Ethereum. Over the past 24 hours, according to the website Coinglass, Ethereum liquidations surged to more than $575 million. These liquidations were skewed by more than 5 to 1 toward short trades, suggesting leveraged short-sellers are getting hit at a staggering pace. In fact, this pace of short liquidations is the fastest since July of 2021, providing retail investors with a potential short squeeze to jump on today.  

As more bullish sentiment builds in the market around Ethereum and other megacap tokens, staking interest on the Ethereum network could surge. For Lido Staked Ether, this is an obvious catalyst. That's because it's the token that represents the equivalent of a receipt for holders of ETH tokens staked on Lido's liquid staking platform.   

For Ethereum Classic, this network, which is actually a fork of the original Ethereum blockchain, has seen a surge in interest from crypto miners who have switched over to mining ETC to make up for lost revenue previously mining Ether. Accordingly, this blockchain is distinct from Ethereum itself, but appears to be rallying based more on broadly bullish macro conditions today.

So what

The moves Ethereum Classic and Lido Staked Ether have made today generally follow the high correlation of these tokens to Ethereum. As tokens that are generally viewed as proxies on Ethereum itself, Ethereum Classic and Lido Staked Ether have both seen a surge in interest as short positions are replaced by more risk-on trades in today's market.

However, it's important to consider the catalysts that drove this short-liquidation surge in Ethereum today. It appears that expectations that central banks could slow interest-rate hikes have driven most of today's bullish shift. The Bank of Canada announced a slower-than-expected rate hike of 50 basis points (0.5%) today, which hinted at the potential of an eventual central bank pivot. That's an obvious bullish catalyst for crypto investors, who have seen leverage come under pressure as rates rise and capital seeks a safe haven in fixed-income assets.

Now what

The crypto market's surge today, led by Ethereum, Ethereum Classic, and Lido Staked Ether, is one that many crypto investors have been longing for. It's been a tough year, to say the least, for most crypto investors, with the overall market still down roughly two-thirds from its peak in late-2021. 

Accordingly, whether the rally we've seen over the past few days can be sustained is the real question. For now, there's a lot to like about the momentum we're seeing with the upside among these three tokens.

But we've also seen downside volatility overwhelm bulls this year more often than not. Accordingly, investors looking to time the bottom might want to wait for more-conclusive data before jumping in with two feet.      

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

The post Why is Ethereum Classic surging today? appeared first on The Motley Fool Australia.

What happened

So what

Now what

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

The post Ethereum surges, but Ethereum classic up much more on merge anticipation appeared first on The Motley Fool Australia.

It seems Australians are very much interested in Bitcoin (CRYPTO: BTC) but don't know a whole lot about it.

Comparison site Finder conducted a survey this month that showed 25% of Aussies will either own or plan to own cryptocurrency by the end of this year. But 20% don't know how to buy it.

And remarkably, 56% falsely believed Tesla Inc (NASDAQ: TSLA) chief executive Elon Musk invented Bitcoin.

Bitcoin was in fact created by an anonymous developer with the alias Satoshi Nakamoto.

Nakamoto's identity has been the topic of furious debate in the past decade. Some, like Australian academic Craig Wright, have claimed they are the real Nakamoto — but no contender has entirely convinced the crypto community.

Musk denied he was Nakamoto in a tweet back in 2017.

8 myths about Bitcoin that Aussies believe in

The Finder study also found many other misconceptions that Australians believed regarding Bitcoin.

Here are the 7 biggest ones other than the 'Elon Musk inventor' theory:

"Bitcoin is not taxed"

The majority of Aussies (59%) think this, even though cryptocurrency profits are taxed as either income or capital gains — like any other asset.

"There's an unlimited number of Bitcoins to be mined"

Programmatically, Bitcoin is limited to a maximum pool of 21 million, but 44% of Australians think there is an infinite source. 

According to Finder, there are currently about 18.6 million in circulation. While there are many active miners at the moment, due to technical reasons experts don't expect to hit the 21 million cap until the next century.

"Bitcoin has been around for more than 15 years"

Not quite. While 44% of Aussies believe this, the cryptocurrency was first distributed in 2009. It was the first-ever implementation of blockchain database technology, and sold for a fraction of a cent initially.

It's now worth $55,552.

"There are fewer than 100 cryptocurrencies"

Thanks to the explosion in popularity over the past 4 years, many different cryptocurrencies have been developed. There are now more than 4,000 currencies in circulation, according to Finder, and this number is growing weekly.

The second most prominent cryptocurrency, Ethereum (CRYPTO: ETC), has been on fire lately. A Bezinga survey this week found investors thought it would actually outperform Bitcoin through this year.

"One Bitcoin is worth more than $100,000"

Bitcoin's value has surged in the past 5 years — it was just $600 in May 2016. But it hasn't quite reached six figures yet. The highest it has been was around $83,000 earlier this year.

"You can't buy things with Bitcoin"

Although Musk opened up Tesla to accept Bitcoin earlier this year then withdrew that capability just last week, there are still many businesses that will accept it.

There are even Australian services like Living Room of Satoshi that allow you to receive a portion of your salary as Bitcoin.

"There are physical Bitcoins"

Even though 22% of Australians believe there are Bitcoin coins or notes, this is entirely false. The currency exists exclusively in digital form using blockchain technology.

The post 56% of Aussies think Elon Musk invented Bitcoin appeared first on The Motley Fool Australia.

Cryptocurrency is hot at the moment, so exchange operator Coinbase Global Inc (NASDAQ: COIN) has demanded much attention since its direct listing last month.

But its US$50 billion float valuation had many scratching their heads as to whether it's starting too high.

Investors were asking this very question on Coinbase's first day on the NASDAQ on 15 April, with the price going up and down wildly.

So with currencies like Bitcoin (CRYPTO: BTC) and Ethereum (CRYPTO: ETC) still all the rage, is it worth dabbling in Coinbase?

Frazis Capital portfolio manager Michael Frazis, in a video update to clients, said his team "really likes" the stock.

"It's not trading as expensively as you think… It would be less than 20 times [enterprise value to sales ratio]. I think it was 17 times sales."

In fact, the stock closed Wednesday morning at US$280.66, dropping 4.61%. 

That's only 12% above the listing reference price, and after it had been up as high as US$429.54 during its first week in the market.

Institutional investors need a trusted cryptocurrency platform 

According to Frazis, cryptocurrency "is heading mainstream" and "every professional investor is thinking about it".

This is where Coinbase comes in, as the "most trusted counterparty" in a wild unregulated emerging market.

"If you have other people's money, you want to make sure your custody is rock-solid. And I don't think any of the other exchanges other than Coinbase really offer that," he said.

"You want to go to the best… Being known as the best custodian, being insured, and being properly regulated… puts Coinbase in a really strong position for all those institutional flows."

The business model is lucrative, according to Frazis.

"Like a brokerage, they charge so much – and it's an extremely profitable business."

"They benefit from flows and volumes, and they certainly benefit from [cryptocurrency] price increase as well, because it increases the volumes."

Don't go all-in on Coinbase though

While the business model and share price look attractive, Frazis reckons anyone considering investing should do so in small increments with a long-term horizon.

This is because the business had its big ramp-up in valuation in the 12 to 24 months before listing.

"That was the big move, so that's not going to happen again," he said.

"If Coinbase trades sideways or down for a year, it could wind up for another explosive movement. But I don't think you'll get a quick buck there – but it's a very good long-term investment."

The post Are Coinbase (NASDAQ:COIN) shares worth a look? appeared first on The Motley Fool Australia.

There was plenty to unpack (and a lot to like) from the NVIDIA (NASDAQ: NVDA) fourth-quarter earnings report. The company's 61% year-over-year revenue growth that was driven by record video gaming and data center sales captured the headlines. But NVIDIA is benefiting from other trends in the economy too, namely cryptocurrencies, autonomous vehicles, and energy efficiency. Here's why that matters.

Separating gaming hardware from crypto hardware

Cryptocurrency prices have soared in the last year, along with a renewed interest in "mining" (simply, when a computer is used to create more of a cryptocurrency). NVIDIA's graphics processing units (GPUs) are built for high-end video games, but they're programmable and ideal for handling cryptocurrency work too. Thus, it seems many commercial miners have started picking up NVIDIA's new RTX 30 series GPUs and have added to the massive demand the company has experienced since the new processors were announced last autumn.

Demand is good. But the last time there was a boom in digital currency prices like Bitcoin (CRYPTO: BTC) and Ethereum (CRYPTO: ETC) a few years ago, the ensuing downturn in crypto prices dragged NVIDIA's stock along with it as its GPU sales slowed. Management wants to make sure its RTX 30 series GPUs end up in the hands of gamers, not crypto miners, so it reduced the hash rate (the processing power for a cryptocurrency network) on its RTX 3060 (the cheapest GPU in its 30 series) by half to discourage its use in this fashion. 

That's not to say NVIDIA is leaving miners out in the cold, though. It simultaneously released a new chip specific for crypto miners: the CMP, or Cryptocurrency Mining Processor. This will help the millions of gamers around the world waiting in line for an RTX 30 series GPU and fulfill demand for commercial digital currency miners. As CFO Colette Kress explained on the earnings call:  

Since our GPUs are sold to graphics card manufacturers and then on to distribution, we don't have the ability to accurately track or quantify their end-use. Analyst estimates suggest that crypto mining contributed $100 million to $300 million to our Q4 revenue, a relatively small portion of our Gaming revenue in Q4.  

CMPs will start shipping in March and will give NVIDIA some increased clarity on where their hardware is being used. Kress said CMPs could contribute about $50 million in revenue in Q1, a significant sum for a brand new chip launching two-thirds of the way into the new quarter. Digital currency is picking up steam and adoption is growing, so this move bodes well for NVIDIA long term. 

What gives with the automotive segment?

NVIDIA hit it out of the park with its Q4 report, but not everything was perfect. Its automotive segment revenue ($145 million, just shy of 3% of total sales) fell 11% compared to a year ago. What happened to NVIDIA, the leader in autonomous vehicles and advanced driver-assist systems?  

First, it's important to bear in mind this segment is in decline because the company has chosen to sunset its legacy infotainment business. But its AI cockpit and self-driving software development is building momentum. Kress said on the call that NVIDIA is growing the list of electric vehicle makers that are signing on to its NVIDIA DRIVE platform for autonomous vehicles. Mercedes-Benz also signed a large deal last year to expand its use of AI cockpit tech. Kress explained: "We are in the early innings of a significant opportunity. We have built a multi-billion dollar design win pipeline for our self-driving AI cockpit solutions, which will drive a material inflection in revenue over the next few years."  

Given the auto segment hauled in just $536 million in sales last year, that pipeline of new business will be significant. Investor patience will pay off here as electric and autonomous vehicle tech gradually picks up momentum.

Cloud computing equals energy efficiency

There has been much talk of the poor condition of the nation's energy grid. Renewable energy and carbon footprint reduction is gaining traction, and it appears the Biden administration will support these endeavors. NVIDIA could be a beneficiary here.

Computing power is increasing, but with greater computational power comes greater energy consumption. However, NVIDIA's data center hardware (which is being implemented at a rapid rate to handle AI and other data-intensive tasks) doesn't just act as a computing accelerator. Its next-gen cloud computing devices are also energy efficient, and Kress said a growing list of companies are using NVIDIA to adopt cloud computing and meet climate change goals.

By way of example, Kress said the NVIDIA A100 (the GPU at the heart of its data center business) "performs AI computations with one-twentieth the power consumption of CPUs" -- or central processing units, the old industry standard general computing chip. In this new age of cloud computing, the A100 puts NVIDIA at an advantage not just in terms of computing power, but also as an ancillary play on climate change and lower energy consumption. With a new upgrade cycle in data center hardware just getting underway, this division is expected to continue growing for the foreseeable future.

NVIDIA is quickly emerging as the leader in next-gen semiconductors and compute systems, and the Q4 report reinforces this. The company is helping pioneer tech advances on many fronts as a new era dominated by cloud computing and AI gets underway. The reasons for staying invested for the long haul keep growing.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

The post Cryptocurrency, autonomous vehicles, and energy efficiency are key to NVIDIA's growth appeared first on The Motley Fool Australia.