Crptocurrency
What is CBDC and How Will It Impact Society in 2023?

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Central Bank Digital Currencies (CBDCs) are digital currencies established and regulated by a country’s central bank.
While they have some characteristics in common with cryptocurrencies such as Bitcoin, the main difference is that their value is fixed and managed by the central bank, reflecting the country’s conventional currency.
With an increasing number of countries actively creating or currently utilizing CBDCs, it is critical that we understand what they are and how they may affect our lives and society as a whole.
What is Central Bank Digital Currency (CBDC)?
CBDC is a digital form of a country’s currency that is administered by the central bank. It lives solely as numbers on a computer or other electronic device, as opposed to actual cash.
In the United Kingdom, the Bank of England is collaborating with HM Treasury to investigate the feasibility of creating a Central Bank Digital Currency. If approved, this new form of money would be known as the “digital pound.”
What Distinguishes a CBDC From a Cryptocurrency?
You’ve certainly heard of Bitcoin, Ether, and ADA—these are privately issued digital assets known as cryptoassets or cryptocurrencies. However, they differ significantly from Central Bank Digital Currencies (CBDCs) in several key areas.
To begin with, cryptocurrencies are created by private organizations rather than by governments or central banks. So, if something goes wrong with a cryptocurrency, there is no higher authority to intervene or remedy the problem, such as a central bank.
Second, cryptocurrency prices are notoriously volatile. Their value can rise or drop in a matter of minutes, making them untrustworthy for daily transactions. On the other hand, if the UK introduced a digital pound, its value would be fixed and managed throughout time, making it a more practical payment option.
Advantages of CBDCs
Central Bank Digital Currencies (CBDCs) supporters argue that these digital currencies have the potential to change national payment systems by lowering costs, boosting transparency, and improving efficiency. They could also be a game changer for increasing financial inclusion, particularly in areas where traditional banking services are scarce or unreliable.
Read Also: Stealing NFTs and Digital Collections Becomes A Crime In China
CBDCs, from the standpoint of central banks, represent new monetary policy levers. They could be used to kick-start a lagging economy or to control inflation. The benefits for the common user could include low to free fees for fast money transfers. Furthermore, governments might quickly distribute and reliably track economic stimulus funds by depositing them directly into citizens’ digital wallets.
Disadvantages of CBDCs
While there is much excitement surrounding the possibilities of Central Bank Digital Currencies (CBDCs), there are also substantial issues to consider. One source of concern is that because digital money is easily traceable, it is also easily taxable.
Furthermore, others question whether the business case for CBDCs is compelling enough to justify the time and money invested. Creating the infrastructure for a digital currency may require more resources from central banks than the potential benefits justified.
Furthermore, the promised increases in transaction speed may not occur; numerous developed countries have already deployed instant payment systems that do not rely on blockchain technology. Indeed, some central banks, notably those in Canada and Singapore, have concluded that, for the time being, the rationale for shifting to digital money isn’t especially compelling.
Disclaimer: The information provided is not trading advice but for educational purposes only. Bitcoinworld.co.in holds no liability for any investments made based on the information provided on this page. We strongly recommend independent research and/or consultation with a qualified professional before making any investment decisions.
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Binance Lists ChainGPT (CGPT): Unlocking a New Era for AI-Powered Blockchain Solutions

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$88K Critical for Bitcoin Momentum

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Bitcoin’s price trajectory is at a pivotal juncture, with $88,000 emerging as a key level for sustaining market momentum, according to on-chain analytics firm Glassnode. Using the UTXO Realized Price Distribution (URPD) metric, Glassnode emphasized the significance of the Short-Term Holder (STH) cost basis, noting minimal trading volume below this threshold.
The $88,000 level serves as a critical psychological and technical support, and a decisive loss could pave the way for further downside. This article explores the importance of this metric and what it could mean for Bitcoin’s future price movement.
Understanding Bitcoin’s STH Cost Basis
The Short-Term Holder (STH) cost basis represents the average price at which recently acquired Bitcoin has been purchased. This metric is essential for analyzing:
- Price Momentum: Indicates the health of recent buyer confidence.
- Support Levels: Highlights crucial price points where short-term investors are likely to defend positions.
At $88,000, the STH cost basis underscores its significance as a level where short-term traders might capitulate if breached, potentially triggering a larger sell-off.
The Role of the URPD Metric
Glassnode’s UTXO Realized Price Distribution (URPD) metric maps the distribution of Bitcoin trading volumes across different price levels. Key insights from the current analysis include:
1. Minimal Volume Below $88K
- Glassnode’s data reveals limited trading activity beneath $88,000, suggesting weak historical support in this range.
2. Vulnerability to Downside Pressure
- A breakdown below $88,000 could lead to accelerated selling, as short-term holders exit positions to minimize losses.
Why $88K Is Critical for Bitcoin
1. Psychological Benchmark
- Round numbers like $88,000 hold psychological significance for traders, influencing decision-making and market sentiment.
2. Technical Relevance
- The STH cost basis aligns closely with support and resistance levels derived from historical price action, making it a reliable marker.
3. Momentum Indicator
- Holding above $88,000 would demonstrate resilience, while a breach could signal a shift in momentum toward bearish conditions.
Potential Scenarios Based on $88K Level
1. Holding Above $88K
- Sustaining this level could reaffirm Bitcoin’s bullish momentum, encouraging accumulation by both short-term and long-term holders.
- Positive macroeconomic news or institutional support could bolster price stability.
2. Breaching $88K
- A decisive loss of $88,000 might lead to panic selling, increasing volatility and pushing Bitcoin toward lower support levels.
- Traders may target $85,000 or lower as the next critical support zone.
Market Sentiment and Influences
1. Institutional Activity
- Institutional investors closely monitor key levels like $88,000, adjusting strategies based on market strength or weakness.
2. Broader Economic Factors
- Macroeconomic elements, including interest rate policies and inflation data, continue to impact risk assets like Bitcoin.
3. Short-Term Trader Behavior
- As the primary holders at this cost basis, short-term traders play a pivotal role in determining Bitcoin’s near-term price movements.
How Traders Can Respond
1. Monitor Key Levels
- Keep a close watch on Bitcoin’s behavior around $88,000, as this level is crucial for gauging momentum.
2. Set Stop Losses and Alerts
- Traders should establish clear stop-loss levels to minimize risk in case of a breakdown.
3. Consider Accumulation Opportunities
- If Bitcoin holds above $88,000, it could present a buying opportunity for those confident in a bullish continuation.
FAQs
1. Why is $88,000 significant for Bitcoin?
The $88,000 level represents the Short-Term Holder (STH) cost basis, a critical indicator of price momentum and market confidence.
2. What happens if Bitcoin drops below $88,000?
A loss of this level could trigger selling pressure, as short-term holders exit positions, potentially leading to further downside.
3. What is the URPD metric?
The UTXO Realized Price Distribution (URPD) metric tracks Bitcoin’s trading volume at different price levels, highlighting key areas of support and resistance.
4. How does $88K influence market sentiment?
Maintaining this level reinforces confidence in the market’s bullish momentum, while losing it could shift sentiment toward bearish expectations.
5. What should traders do at this level?
Traders should monitor Bitcoin’s performance around $88,000, set stop-loss levels, and consider accumulation if the level holds.
Conclusion
The $88,000 level is more than just a price point; it’s a pivotal marker for Bitcoin’s momentum and market sentiment. Glassnode’s analysis underscores its significance as the Short-Term Holder cost basis, with the potential to dictate Bitcoin’s next move.
Whether Bitcoin sustains this critical level or breaches it will determine its trajectory in the coming weeks. For traders and investors, staying vigilant and adapting strategies to this key metric will be essential in navigating Bitcoin’s dynamic market.
To learn more about the innovative startups shaping the future of the crypto industry, explore our article on latest news, where we delve into the most promising ventures and their potential.
Disclaimer: The information provided is not trading advice, Bitcoinworld.co.in holds no liability for any investments made based on the information provided on this page. We strongly recommend independent research and/or consultation with a qualified professional before making any investment decisions.
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Mantra Partners with UAE Real Estate Giant Damac to Tokenize $1B in Assets

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