MINA Token Surges as Market Activity Records an Impressive Jump

As of writing, Bitcoin is trading at $30,400, but according to Standard Chartered, the largest digital asset can reach as high as $50,000 by the end of this year.

On Monday, the bank also predicted a price target of $120,000 for BTC for the end of 2024, up from the $100k forecast it published back in April. It further predicted that the recent jump in Bitcoin’s price, having rallied 83.5% in 2023 so far, could encourage Bitcoin miners to hoard more of the supply.

Geoff Kendrick, the bank’s FX analyst, said this increased profitability for each Bitcoin mined means miners can sell less while maintaining their cash inflows. This, in turn, reduces net BTC supply and pushes the crypto asset’s prices higher, he added.

Despite Bitcoin’s stellar recovery since dropping under $16k late last year following the crypto exchange FTX’s collapse, the crypto asset is still down 56% from its all-time high (ATH) of $69,000 in November 2021.

Now, Standard Chartered is bullish on Bitcoin because miners would soon need to sell fewer coins to cover their costs, mostly electricity, to power their machines. According to the analyst, miners have been selling all the new coins they have been producing, but if the price sees over a 66% upside to hit $50k, miners may only sell 20-30% of their coins.

“It is the equivalent of miners reducing the amount of bitcoins they sell per day to just 180-270 from 900 currently.” This would mean a reduction of about 250,000 BTC a year in net Bitcoin supply. On top of it, next year, in April, with halving, the total number of Bitcoin that can be mined each day will also halve.

Just like Price, Hash Rate & Mining Difficulty on Rise Too

While BTC seems to be making a slow recovery, its hash rate hit a new ATH over the weekend. The hash rate surged 14.5% in a day to 465 EH/s on Saturday, as per Bitinfocharts. The value dropped about 6% to 428 EH/s the following day. However, the blockchain network’s hash rate is still at its highest level.

The hash rate in a Proof of Work (PoW) crypto like Bitcoin serves as a measure of the estimated computational power committed to supporting the ecosystem. A higher hash rate translates to a more robust and secure network, as a rising hash rate means the difficulty level for potential attacks is also increasing.

But at the same time, an elevated hash rate means miners need to allocate additional resources to successfully compete and mine Bitcoin. This may also result in higher energy consumption, and to compensate for these growing expenses, miners may sell the coins they generate. And when prices are low, miners have to sell more BTC.

Besides the rising BTC prices and miners putting more efficient machines to work ahead of the upcoming halving, this latest spike in Bitcoin hash rate could also be due to Texas-based miners being back at full capacity, according to a Hash Rate Index report. Recently, a heat wave in Texas resulted in Bitcoin miners halting their operations. However, the report says, it turned out to be “too weak to cause substantial problems” to the state’s electricity grid, and miners resumed their operations as normal.

An increase in the hash rate is also expected to result in a spike in Bitcoin mining difficulty, which is the computational power required to mine BTC and is adjusted roughly every two weeks. “The next difficulty adjustment is going to be a f** whopper,” said the report.

Macro in Focus

On the macro front, inflation data will be in the spotlight this week with the release of the U.S. June Consumer Price Index (CPI) on Wednesday, and then on Thursday, the Producer Price Index will be made public.

The US Labor Department will also announce jobless claims for the week on Thursday. Last week’s ADP report actually showed some unexpectedly strong results as businesses added 490,000 private sector jobs. While a strong employment market often precedes higher prices, which gives the Fed the support to raise rates, there was also an unexpected but slight increase in jobless claims.

A decline in CPI and PPI figures could see the Federal Reserve continuing to keep a pause on any rate hikes. The market has been expecting the US central bank to raise interest by 0.25% after the Fed paused rate hikes last month for the first time in more than a year.

The interest rate is currently in the range of 5%-5.25% after the Fed started increasing them in March 2022 from virtually zero to tackle the rising inflation. This indeed helped the Fed cut the CPI from 9% in August 2022 to May’s 4% reading. However, more recently, it has also raised concerns about the economy entering into a recession.

MINA Surges as Altcoins Gain Traction

Bitcoin is holding steady at $30,000 means altcoins are enjoying the greens. Ether is currently trading at $1,870, while crypto assets like Compound, Polygon, Solana, BitDAO, Kava, Render, Fantom, Aave, Gala, and Litecoin (3.3%) are also recording decent gains. This has the total crypto market cap up by 0.8% at $1.23 trillion.

Among the top 100 crypto assets by market cap, MINA, in particular, went up 17.4% to $0.5069 before giving up much of these gains later in the day on Tuesday. At the time of writing, MINA has been exchanging hands at $0.4664 while managing $82.6 million in trading volume, up a whopping 1009.8% from a day ago.

This increase in recent market activity is due to the largest South Korean crypto exchange, Upbit making the token available to a market known for irrational exuberance.

With its latest gains, MINA is now up 11% in the past 30 days and 7.87% year-to-date (YTD). Much like the majority of the crypto market, MINA started 2023 on a bullish note as it went from almost $0.436 at the beginning of the year to $1.20 in mid-Feb. Ever since then, MINA’s price has been on a downtrend except for brief spikes in March and April.

MINA is the native token of the Mina network, used to execute transactions and distribute fees. Besides being used as a payment medium and to secure the network by staking, the MINA token is also used to interact with “Snapps,” decentralized applications (dApps) built on the protocol.

MINA’s initial supply was 1 billion tokens, out of which currently, almost 500 million are circulating in the market. Its total supply will continue to increase over time, but inflation is set to decrease from 12% to 7% over the first five years.

It was launched amidst the bull market of 2021, during which it went on to hit a peak of $9.09 and has lost 94.6% of its value since then. Just last month, MINA’s price dropped to its all-time low at $0.380.

Click here to learn all about investing in Mina Protocol (MINA). 

Mina Protocol Building the Privacy Layer with ZKPs

Mina Protocol is a “lightweight” smart contract platform aiming to be a global payment system by addressing the scalability issues of existing blockchains. Its development started in 2017, but the mainnet was launched in 2021.

To become a decentralized payment system that offers efficient verification of system history from genesis without relying on any external advice, Mina Protocol offers a “succinct blockchain” by using zk-SNARKs. Zero-knowledge succinct non-interactive arguments of knowledge or zk-SNARKs is a cryptography technique that does not require each node to record the complete record of historical transactions.

By combining it with a Proof-of-Stake (PoS) consensus mechanism, Mina significantly cuts down on the resources needed to process and record transactions. Mina uses a provably-secure PoS consensus protocol called Ouroboros Samasika, which is adaptively secure and offers bootstrapping from Genesis. The protocol also uses a parallel scan state to improve transaction confirmation time.

On the Mina network, if one wants to send or receive transactions, they have to run a node, and there are two specialized nodes within the network to run effectively: Block producers, like the “miners” or “validators,” select which transactions to include in the next block and win that block’s reward. Meanwhile, Snark workers dedicate computing power to help compress network data and generate proofs of transactions, on which block producers can then bid for which snark workers are paid in MINA tokens.

The Mina blockchain, which is building the privacy and security layer for web3 with zero knowledge proofs, has a size of just ~22kb to enable users to quickly and directly access the current state of the blockchain right from their smartphone. This means anyone can connect peer-to-peer easily and validate transactions, ensuring the blockchain’s censorship resistance and security.

This lightweight design and the off-chain nature make using Mina’s proof system from other chains easy. There is also a bridge between Mina and Ethereum in progress, enabling DApps on other chains to take advantage of Mina’s efficient proofs of large computations and privacy-preserving data verification features.

Being powered by zero knowledge, Mina’s Zkapp smart contracts allow users to own their data and be in control of their privacy.

In April this year, the protocol announced its roadmap, which showed that it focuses on boosting scalability and privacy for the project. According to the protocol’s transparency report for Q1 2023, it had significant growth and adoption, with its unique accounts increasing by 7.57%, monthly block producers rising to 370, and 911 commits made to the GitHub repositories during this period.

The protocol also redeployed the ‘Berkeley’ Testnet earlier this year, which allows developers and users to test the functionality of the MINA protocol in a simulated environment in preparation for the hard fork. In May, the project then announced its incentivized testnet, yet another big step towards bringing programmable ZK proofs to Mina Protocol’s mainnet with zkApps.

Most recently, the crypto network introduced its Cohort 1 Project called BioSNARKs, which uses ZKPs to allow participants to share or trade validated biotech data without disclosing any sensitive information.

“This opens up new possibilities for accelerated and more democratized drug and biotech development,” said the team.

Click here to learn all about buying Mina Protocol (MINA) in just four steps.