Why Bitcoin, Ethereum and Polygon jumped today

What happened

The crypto markets moved up sharply on Thursday morning as investors cheered for more stability than we have seen in several weeks. Celsius Network, a major lender and finance company for cryptocurrencies, has officially filed for bankruptcy protection, and Ethereum (ETH 7.22%) moved closer to its proof-of-stake consensus mechanism. Sometimes just reducing the uncertainty is enough to push the crypto higher.

During the last 24 hours, from kl. 14.00 ET, was the value of Bitcoin (BTC 1.04%) was up 4.7%, Ethereum was up 10.1%, and Polygon (MATIC 11.51%) had jumped 21%.

So what

The biggest news is that Celsius Network filed for Chapter 11 bankruptcy protection in the United States, which at least puts an end to speculation about the company’s future. Management said they have $ 167 million in cash available to fund operations, but customer funds will now be part of the Chapter 11 process and not available on a first-come, first-served basis.

As bad as it is for a company to apply for bankruptcy protection, this brings the Celsius Network saga to a kind of conclusion. The company’s positions will be wound up, and creditors will be repaid. Eventually, some customers may even get their money back.

In more meaningful news, Ethereum’s ninth shadow fork went live, continuing testing of its evidence-on-effort consensus mechanism and moving closer to merging the test network and the main network. Investors have anticipated the upgrade because it will reduce transaction costs for Ethereum and increase the number of transactions that can be performed per second.

The jump in crypto is even more shocking when you consider that US stock markets and global commodity markets are significantly down today. The stock indices are down almost 1% while gold and oil are down 1.6% and 1.3% respectively, as I write.

What now

It will probably still take some time before the positions that Celsius Network builds up are wound up, but there is at least one way forward now. This is what the market is cheering for, and I think it can reduce the amount of influence in the crypto market overall.

If Ethereum can complete the transition to proof of effort and reduce costs and increase blockchain throughput, it could be a game changer. This is still the largest developer network in the cryptocurrency world, and reducing costs will increase the number of available utility cases.

The next few months are likely to remain volatile, but the collapse of some of these leveraged trading platforms that did little to benefit the crypto industry is likely to be a blow to the road. In the long run, the crypto industry will be about building new, disruptive technology – not new ways of trading assets – and today’s news brings everyone one step closer to it.