ProBit Bits — ProBit Global’s Weekly Blockchain Bits Vol. 75

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 ETH Whale Liquidates $22 Million, Vitalik Denies Involvement

The cryptocurrency market was surprised by a massive ETH sell-off after an unnamed "whale" liquidated nearly 14,000 ETH worth just under $22 million. On-chain data revealed the wallet received the ETH in January 2021 from the exchange Bitfinex before the bull market. Speculation arose that it may have been Ethereum founder Vitalik Buterin behind the sale, but he clarified on Twitter that he hasn't sold ETH since 2018. Technical analysts provided varied predictions, with some like Big Chonis saying the selling pressure has opened a path for ETH to drop below $1,000, while Income Shark argued the dip presents a buying opportunity. The whale's identity remains unknown, but the incident has added uncertainty around Ethereum's price trajectory in the near term as the market weighs the impact of such a sizable offload.

 Reddit to Shut Down ETH-Based Community Points Program

Reddit has announced that it will be discontinuing its Ethereum-based Community Points program at the end of November. The social platform cited scaling limitations and regulatory uncertainty as factors behind the decision. Through Community Points, specific subreddits utilized tokens built on Ethereum to incentivize user participation, with tokens like Moons distributed in the CryptoCurrency subreddit. However, Reddit said there was no clear path to broadly scaling the program across its platform. Some users speculated this was due to complications around tax regulations or securities classifications. The abrupt announcement surprised moderators of the CryptoCurrency subreddit, who said they were not informed until an hour beforehand. While users will no longer be able to earn or view points in their Reddit Vault wallets going forward, any tokens already held will reportedly remain functional on Ethereum.

 Analysts Downplay Role of Crypto in Fueling Middle East Violence

Recent reports have claimed cryptocurrency has played a key role in funding militant Palestinian group Hamas' attacks on Israel. However, analysts tracking illicit crypto flows argue only a small fraction of Hamas' total fundraising can be attributed to digital assets. Chainalysis noted terrorist groups will utilize any means available to raise funds. While Hamas has used crypto since 2019, industry experts say the sums raised have been minimal compared to traditional methods. Amid the geopolitical tensions, some lawmakers have cited cryptocurrency as enabling terrorism, but the crypto industry is pushing back against disproportionate blame. Chainalysis also warned some reports have likely overestimated metrics by wrongly assuming all activity through services linked to illicit transactions was illicit. Regardless, cutting off access to facilitating entities remains an important strategy for disrupting terrorism financing.

 EU Approves Controversial Crypto Tax Reporting Rules

The European Union has formally adopted new rules that will facilitate the automated sharing of cryptocurrency ownership data between member states' tax authorities. Known as DAC8, the laws force crypto companies like exchanges to report information on EU customers' holdings to their local tax bodies. This data will then be shared across jurisdictions in a bid to curb tax evasion and avoidance using digital assets. The rules were agreed by finance ministers on Tuesday and will be published in the EU's official journal in the coming weeks. While targeting crypto, the legislation was also expanded to cover entities dealing with electronic money and central bank digital currencies. The EU Commission said DAC8 complements other recent regulations like MiCA to improve tax compliance. However, the regulations were discussed privately without public scrutiny over how extensively customer data will be shared.

 Altseason Stalls as Bitcoin Market Share Hits Yearly Highs

Bitcoin dominance has reached its highest level this year, rising to 52.17% according to data from TradingView. This marks a steady increase from the start of 2023, when BTC dominance was at 42%. The climb in dominance has come at the expense of altcoins, with the total crypto market capitalization remaining stable around $1.1 trillion. Most altcoins are still down 80-90% from their peak prices in 2021. Ethereum has fallen to a seven-month low price, while other major altcoins are also declining. Some analysts predict a further "final flush out" could occur before Bitcoin's lead strengthens further ahead of its upcoming halving event. However, BTC continues attracting liquidity and interest. If it maintains support above key price levels, its dominance may continue rising as altcoins remain mired in their multi-year bear market.

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