Powerful traders are increasing their participation in the crypto world 

Cryptocurrencies have gradually come out of obscurity, and while they were only well-known to those very interested in the technology in the beginning, they are now part of the portfolios of people from all over the world. And it’s not just individual traders that are interested in it; institutional and large investors have also started moving cryptocurrencies. This is an essential step toward more extensive acceptance of digital assets, especially given the context of increasing regulatory pressures.

During 2022, the marketplace navigated a difficult period, but investors have returned to buy Bitcoin especially given that figures show a strong bullish run is underway. That means you should grow your portfolio now before prices become significantly higher and buying becomes more difficult.

Record participation 

Data from the Chicago Mercantile Exchange shows that Bitcoin and Ether futures saw record participation levels from large traders throughout Q2. This includes holders that own at least twenty-five Bitcoin futures contracts, which average around 107 during the second quarter. Institutional interest in this asset class continued to grow as investors began looking for ways to increase the security of their holdings, given the threat of inflation.

CME futures are regulated under the Commodity Futures Trading Commission, with the standard future being the equivalent of 5 BTC. There’s also the option for a micro contract with a size of one-tenth of 1 BTC. This way of interacting with the cryptocurrency market has long been preferred by institutions who want to expose their enterprise to digital assets without directly owning cryptocurrency.

The increased participation rates are directly correlated with the crypto marketplace recovering in 2023. During the first half of the year, Bitcoin climbed by around 84% compared to the final months of 2022, when it reached one of the lowest points in its history.

NFT shrinkage 

Non-fungible tokens were one of the most popular asset classes in the world during the late 2010s, with investors flocking to get their hands on the prized tokens. NFTs made the news quite a few times, as the general public found the prices for which they were sold, often amounting to millions of dollars, to be absolutely astounding. Others believed that the price point wasn’t justifiable. In fact, even members of the crypto community thought that the hype would be short-lived and perhaps even cause financial troubles for the ones that choose to jump on the bandwagon.

However, data shows that the market is currently struggling due to the aftershocks of a 38% drop in trading volumes between the first and the second quarters of 2023. The sales decrease is nearly 10%. Together, these two figures show an accurate, albeit bleak, state of the current market. The lowering event began as early as January 2023, and the numbers haven’t recovered. In fact, they continued to drop even further.

At the other end of the spectrum, Bitcoin Ordinals have been doing quite well, being one of this quarter’s big winners. There was a surge in all-time traders, with whopping figures showing nearly 151,000 unique traders and over 554,200 trades. There’s a reason for the hype, considering that this is the most significant innovation on the BTC blockchain over the past few years and a direct result of the Taproot upgrade of November 2021. By May 2023, the number of Ordinal inscriptions was over ten million, with the larger portion made during the previous month.

Paper wallets 

There are three main types of crypto wallets: software, hardware and paper. Naturally, the first one is application-based, while the second is more like a device that is also cold, meaning that it lacks internet connectivity. Most investors feel safer with the hardware option when storing larger quantities of coins, given that it offers extra security. Crypto wallets are highly coveted by hackers and cybercriminals, and it can be tough to get your funds back after your wallet was targeted.

But what about paper wallets? Generally, they are also considered a safe way to store digital money since they’re not so susceptible to online hacking and other virtual threats. That means they come equipped with an extra protection layer for your assets. You also have complete control over your money. However, it seems that even in this case, investors must consider their options carefully and not fall into the trap of thinking that nothing could happen with their holdings.

A Reddit user has recently taken to discussing their experiences, asking for an explanation on how a cybercriminal could have possibly stolen over $3,000 worth of BTC from their paper wallet. Apparently, the device was also generated to an offline computer, meaning the hacker must have been particularly crafty to succeed.

The wallet was under self-custody, with the key generated and printed on an online computer and with the keys kept safe. According to the investor, they believed this was the safest route to protect their assets. However, the investor also revealed they had used a wallet creator generator that other Redditors pointed out as notorious for vulnerabilities in the past.

In fact, some have discussed how these tools may actually be hacking tools masquerading as legitimate generators. So, it’s better not to use them to avoid falling prey to scammers. The IP address used by the website allegedly has several abuse reports filed against it. As such, many investors have discussed how hardware options still appear to be the most reliable.

Hackers have managed to snatch approximately $300 million during the second quarter of 2023. And while the numbers are staggering, they also indicated a decline of nearly 60% compared to the same time in 2022.

The bottom line 

The cryptocurrency market is still recovering after the bear market and crypto winter of 2022. Bitcoin naturally took the most considerable leaps, but the rest of the cryptocurrency world also followed. When BTC does well, the other coins and tokens fare better too. However, there’ll still be a while until the prices return to their 2021 levels. However, if the bull market managed to hold the momentum, Bitcoin might surpass its all-time high two years ago.