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Bitcoin exhibited significant volatility leading into the Wall Street open on September 8th, driven by what is commonly referred to as a “short squeeze,” resulting in new highs for September.

BTC’s price fluctuations led to the liquidation of both short and long positions. After a surge that took Bitcoin above $26,400 following the previous day’s upward momentum, the cryptocurrency retraced its steps and fell back below the $26,000 mark at the time of reporting.

Late Traders Face Consequences

Late traders who chased the market experienced losses as a result of these rapid price shifts. Short liquidations amounted to $23.5 million on September 7th, while the long liquidation total for September 8th was yet to be determined.

Market analyst Skew noted that shorts were “hunted as expected.” He highlighted that Bitcoin had managed to break above the September monthly open after multiple tests, and its ability to hold above this level would be crucial for maintaining a positive trajectory in September.

Historical Price Trends in September

Data from CoinGlass indicated that September historically tends to witness a nearly 10% downside correction in Bitcoin’s price, aligning with market expectations for 2023.

Trader Crypto Tony emphasized the significance of the $26,600 price level as a key threshold to cross for further positive momentum. He observed that while there was a rally from the $25,600 range low, it lacked the follow-through required to reach the range highs.

Bitcoin’s Technical Analysis

BTC/USD continued to hover around the 200-day exponential moving average (EMA), currently positioned at $25,674. Analyst MichaΓ«l van de Poppe suggested that the market might be experiencing the “final” price correction in this cycle, comparing it to past cycles and highlighting the significance of the 200-week EMA.

Bitcoin’s recent price action has been marked by volatility, driven by a short squeeze, with traders experiencing both gains and losses. The cryptocurrency market is closely watching key price levels for signals of future direction, while historical trends suggest a potential downside correction in September.

 

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The Commodity Futures Trading Commission (CFTC) in the United States has taken significant steps to address a long-standing enforcement case involving Mirror Trading International (MTI), which had collapsed earlier. On September 7, the United States District Court for the Western District of Texas ordered MTI to pay $1.7 billion in restitution to victims. The case revolved around a fraudulent scheme related to digital assets and forex trading.

Fraudulent Scheme Involving Digital Assets

The CFTC revealed that MTI and its CEO, Cornelius Steynberg, were involved in what they described as an “international multi-level marketing scheme.” This scheme accepted approximately 30,000 Bitcoin from at least 23,000 individuals in the United States. MTI and Steynberg had promised to grant access to an unregistered commodity pool in exchange for BTC contributions, a promise that was never fulfilled. Instead, the CFTC stated that MTI misappropriated nearly all of the funds.

The latest court order and restitution bring closure to a case that the CFTC had filed in June 2022. MTI had entered provisional liquidation in late 2020, leading to significant losses for investors, as one of its directors allegedly fled the country with all the entrusted Bitcoin.

One of the Largest Digital Asset Ponzi Schemes

MTI’s fraudulent activities were extensive, with the scheme claiming over 260,000 members across 170 countries in January 2021. Investors had lost approximately $1 billion by the time of the liquidation, making it one of the largest Ponzi schemes involving digital assets.

CFTC Commissioner Kristin Johnson emphasized the importance of staying informed about potential scams and abuses in digital asset markets. The CFTC has been actively addressing such issues and has, since June 2023, either brought or resolved ten fraud cases involving digital assets and forex markets. Johnson commended the Division of Enforcement for its vigilance in sending a strong message that the Commission will take necessary actions to safeguard markets from fraud.

Cryptocurrency Regulation Pilot Program

In related news, CFTC Commissioner Caroline Pham has proposed a limited pilot program to address cryptocurrency regulation in the United States. Pham believes that the U.S. may need to “catch up” with crypto-friendly jurisdictions. Meanwhile, another CFTC Commissioner, Summer Mersinger, has raised concerns about enforcement actions related to decentralized finance protocols, advocating for more public engagement and stakeholder involvement in regulatory decisions.

 

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On September 8th, Bitcoin’s price fell by approximately 1.75%, dropping to nearly $25,850. This decline can be attributed to profit-taking by traders who had seen recent gains and long liquidations in the derivatives market.

Technical Correction and Market Indecisiveness

Throughout September, Bitcoin’s price exhibited a lack of clear direction, with small gains and losses, amidst decreasing liquidity supply. Traders’ uncertainty stemmed from factors such as the ongoing delay in a spot Bitcoin ETF and concerns surrounding the Federal Reserve’s upcoming interest rate decision.

Bitcoin’s price had been trading within a tight range, marked by $26,450 as resistance and $25,550 as support. Traders had been following a strategy of buying at support levels and selling at resistance levels. The lack of buying momentum near the $26,450 resistance level likely contributed to the September 8th selloff.

Increase in Exchange Reserves

Another factor influencing the price decline was a slight increase in Bitcoin reserves held on cryptocurrency exchanges. The rise in exchange reserves from 2.03 million to 2.05 million BTC in September added potential selling pressure to the market.

The September 8th selloff triggered a wave of long liquidations in the derivatives market, resulting in $7.78 million of long positions being liquidated. Traders were forced to sell Bitcoin to cover their losses, intensifying selling pressure.

Bitcoin’s Future Price Direction

From a technical perspective, the September 8th price drop pushed Bitcoin below its 50-4H exponential moving average (50-4H EMA), increasing the likelihood of further downward movement toward the $25,550 support level. This support level is characterized by a horizontal level and a descending trendline.

Conversely, if Bitcoin can reclaim the 50-4H EMA as support, it may have the potential to retest the $26,000 level, potentially leading to a rally toward the 200-4H EMA, which is near $26,975.

 

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Today, the crypto market displays bullish signs as Bitcoin and major Altcoins exhibit promising price recoveries. The Fear And Greed Index, although still indicating fear, has increased by two points since yesterday, reaching 37/100.

Bitcoin (BTC) remains below the $30,000 threshold at $26,305.77, experiencing an almost 2% gain in the past day. Other notable altcoins like Cardano (ADA), Polkadot (DOT), and Solana (SOL) have also seen positive price movements.

Ethereum is currently trading at $1,649.57, reflecting a 0.67% increase in the last 24 hours. XRP has observed a gain of 0.48%, while Solana has surged by 1.46%. Conversely, Polygon (MATIC) has declined by 1.84% since the previous day, and Polkadot has witnessed an increase of approximately 1.01%.

In the realm of meme cryptocurrencies, Dogecoin has risen by around 0.33%, while Shiba Inu’s token price has decreased by 0.02% in the last 24 hours.

The crypto market today demonstrates overall price recovery, with a few exceptions. The global crypto market cap has significantly risen to $1.06 trillion, compared to yesterday. The 24-hour crypto market volume stands at $25.03 billion, indicating a decrease of more than 6.32%.

The top 4 cryptocurrencies for today are as follows:

Pepe coin has increased by 0.24%. Its price currently stands at $0.0000008058, with a global market cap of $315.73 million. Pepe coin encountered resistance at higher levels, resulting in weakened bullish momentum and subsequent price decline.

ASTR crypto token has surged by 4.42%. Astar’s ASTR token is trading at $0.06035, holding a global market cap of $316,704,723. Astar Network is recognized as one of the leading smart contract platforms in Japan.

XDC crypto token has risen by 4.24%. XDC Network’s XDC is currently priced at $0.05687, with a global market cap of $788,490,163. The token’s adaptability and high investor expectations contribute to its anticipated bullish trend, offering optimism to the community after recent declines.

SNX token has declined by 3.19%. Synthetix’s SNX token is trading at $2.25, holding a global market cap of $605,563,491. Despite announcing the emergence of Synthetix V3, a more advanced and user-centric version of its system, the token has experienced a decrease in value.

 

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On September 7, Bitcoin encountered a critical long-term trendline as the US dollar demonstrated its strongest performance in six months. BTC’s price gravitated around the $25,700 mark, showing a degree of stability compared to the previous day, which witnessed fluctuations between $26,000 and local lows below $25,400 within an hour.

BTC/USD 1-hour chart. Source: TradingView

Caution Prevails Among Bitcoin Participants

Market sentiment regarding Bitcoin remained cautious, with many anticipating further downside. Prominent trader TraderSZ expressed this sentiment, suggesting that unless Bitcoin reclaims its May low, he expects further downward movement.

β€œTaken a short here half size targeting 23.6k. If we reclaim May low I will look to scale out.”

Key Level: 200-Week EMA

MichaΓ«l van de Poppe, CEO of trading firm Eight, emphasized the significance of the 200-week exponential moving average (EMA) at $25,670 as a pivotal level to monitor on weekly timeframes. The question on everyone’s mind, he noted, is whether Bitcoin will maintain its position above this crucial EMA.

BTC/USD annotated chart. Source: TraderSZ/X

Bearish Predictions and Altcoin Concerns

Trader and analyst Toni Ghinea made a more categorical prediction, envisioning Bitcoin’s decline to $25,000 and possibly lower. Ghinea also suggested that altcoins would follow suit with new lows. He asserted that the move downward is far from over and cautioned against overly relying on the ETF narrative, suggesting it’s used to manipulate the market.

US Dollar Strength and Its Impact on Crypto and Risk Assets

Beyond the cryptocurrency realm, the US dollar’s strength had broader implications for risk assets. The US dollar index (DXY), after surpassing May’s local highs, reached 105.15, marking its highest level since March 10.

Analysts expressed concerns that the US dollar’s rally would continue to exert pressure on risk assets, particularly those on the higher end of the risk spectrum, such as cryptocurrencies. This sentiment was echoed by trader Benjamin Cowen, who highlighted the potential drain on risk assets due to the strengthening US dollar.

U.S. dollar index (DXY) chart with moving averages. Source: Caleb Franzen/X

Caleb Franzen, senior analyst at Cubic Analytics, concurred, emphasizing the bullish nature of the US Dollar Index (DXY) and its potential bearish implications for financial assets, particularly US equities.

US Dollar Strengthens, Casting Shadow on Crypto and Risk Markets

As Bitcoin tests its crucial 200-week moving average, the surging US dollar raises concerns about the stability of risk assets, with both traders and analysts expressing caution and predicting further downside potential.

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During a sweltering August heatwave in Texas, Bitcoin mining firm Riot Platforms made significant energy reductions, earning $31.7 million in energy credits for the power it would have otherwise consumed.

Energy Demand Cut by 95%

Riot Platforms, in response to the scorching conditions, curtailed its energy demand by 95%. This measure allowed the company to redirect vital resources to the local electricity provider, ERCOT. In August, Riot Platforms mined only 333 Bitcoin, valued at approximately $8.9 million.

Maintaining Power Supply for Texans

Jason Les, CEO of Riot Platforms, emphasized the importance of these energy credits in maintaining electricity services for ordinary Texans. The reduction in power demand contributed to overall power stability in ERCOT.

Riot Platforms views these energy credits as a significant cost reduction element in its Bitcoin mining operations, positioning the company as one of the industry’s most cost-effective producers.

Texas Governor’s Miner-Friendly Approach

Texas Governor Greg Abbott has adopted a “miner-friendly” stance, advocating for more miners to establish operations in the state. This approach aims to address the state’s historically unstable grid by encouraging additional power generation facilities.

Market Challenges for Bitcoin Miners

Riot Platforms, like other crypto mining firms, has faced market challenges, including volatile energy costs and intense competition among miners. Despite impressive revenue growth in 2021, the company experienced net losses exceeding $500 million in 2022. While Bitcoin’s value rebounded in 2023, its stock remains significantly below its 2021 peak.

Looking Ahead

Bitcoin miners continue to navigate a landscape of record-high hash rates and forthcoming halving events, which will reduce miners’ rewards. Miners are diversifying their activities, with some venturing into high-performance computing services to cater to the growing artificial intelligence market.

In conclusion, Riot Platforms’ energy conservation efforts during the Texas heatwave highlight the resilience and adaptability of the Bitcoin mining industry in the face of evolving challenges.

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In the latest edition of Coinbrit’sΒ Market Report, analyst Marcel Pechman delves into the factors propelling Bitcoin towards a potential $22,000 price point. He also examines BitMEX co-founder Arthur Hayes’s assertion that the Bitcoin bull market initiated in March.

Bitcoin’s Trajectory to $22,000

Pechman cites multiple drivers influencing Bitcoin’s upward trajectory. Investor sentiment has soured following Grayscale Investments’ much-hyped legal victory against the SEC on August 29 and its delay of several spot Bitcoin exchange-traded fund applications. Additionally, legal actions by the SEC against major crypto exchanges like Binance and Coinbase, accompanied by potential DOJ indictments for money laundering and Russian entity dealings, are raising concerns.

The Crucial Role of U.S. Inflation and the Federal Reserve

Pechman highlights the crucial role played by U.S. inflation, which has dropped to 3.2%, and the U.S. Federal Reserve’s efforts to reduce liquidity in the markets. These factors contribute to the bearish sentiment surrounding Bitcoin.

BitMEX founder Arthur Hayes contends that the Bitcoin bull market commenced in March. He attributes this to the Silicon Valley Bank’s troubles and the subsequent U.S. Treasury Department intervention.

The Complex Dynamics of the U.S. Dollar Index

Pechman acknowledges Hayes’s perspective but introduces the U.S. Dollar Index as a variable. Despite Bitcoin’s appeal, the index’s stability over the past six months suggests investor confidence that other countries would experience economic instability before the U.S. in the event of a global recession.

Ultimately, Pechman concludes that the Federal Reserve prioritizes the stability of banks, even if it triggers economic turbulence. U.S. Treasurys and the U.S. dollar continue to be perceived as safe havens in times of uncertainty.

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Grayscale has formally requested a meeting with the U.S. Securities and Exchange Commission (SEC) to discuss the conversion of its flagship Grayscale Bitcoin Trust (GBTC) into a spot exchange-traded fund (ETF). Following a recent court ruling against the SEC’s denial of the conversion application, Grayscale’s lawyers argue that there are no legal grounds left to block the process.

Screenshot of the letter sent to the SEC by Grayscale’s retained law firm Davis Polk. Source: Grayscale

Seeking Fair Treatment for Investors

Grayscale emphasized that it believes there are no reasons to treat GBTC differently from Bitcoin futures ETFs that the SEC has previously approved. The firm urged the SEC to ensure a level playing field for the nearly one million investors in the Grayscale Bitcoin Trust.

β€œNow that the Court of Appeals has spoken, there is no available rationale that would distinguish a Bitcoin futures ETP from a spot Bitcoin ETP under the legal analysis previously adopted by the Commission in rejecting spot Bitcoin ETPs.”

Grayscale pointed out that its conversion application has been pending for significantly longer than the time frame stipulated by SEC rules. The firm aims to expedite the process, aligning it with market demand and the interests of its investors.

GBTC Discount Narrows

Since the August 29 court ruling in favor of Grayscale, the discount on GBTCβ€”indicating the difference between its trading price and net asset valueβ€”has narrowed to 19.9%. This development reflects growing investor confidence in the potential approval of the GBTC conversion.

β€œWe believe the Trust’s nearly one million investors deserve this fair playing field as quickly as possible.”

Grayscale’s pursuit of converting GBTC into a Bitcoin spot ETF highlights the broader industry trend of seeking SEC approval for cryptocurrency ETFs. Such approval would enable greater access to Bitcoin for institutional and retail investors, potentially driving increased adoption of cryptocurrencies.

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Top 10 Machine Learning Algorithms for Beginners

how does machine learning algorithms work

Using statistical methods, algorithms are trained to determine classifications or make predictions, and to uncover key insights in data mining projects. These insights can subsequently improve your decision-making to boost key growth metrics. Our study on machine learning algorithms for intelligent data analysis and applications opens several research issues in the area.

how does machine learning algorithms work

Semisupervised learning works by feeding a small amount of labeled training data to an algorithm. From this data, the algorithm learns the dimensions of the data set, which it can then apply to new unlabeled data. The performance of algorithms typically improves when they train on labeled data sets. This type of machine learning strikes a balance between the superior performance of supervised learning and the efficiency of unsupervised learning. Decision tree learning uses a decision tree as a predictive model to go from observations about an item (represented in the branches) to conclusions about the item’s target value (represented in the leaves).

Machine learning vs. deep learning

Choosing the right algorithm can seem overwhelmingβ€”there are dozens of supervised and unsupervised machine learning algorithms, and each takes a different approach to learning. The many different types of machine learning algorithms have been designed in such dynamic times to help solve real-world how does machine learning algorithms work complex problems. The ml algorithms are automated and self-modifying to continue improving over time. Before we delve into the top 10 machine learning algorithms you should know, let’s take a look at the different types of machine learning algorithms and how they are classified.

Use regression techniques if you are working with a data range or if the nature of your response is a real number, such as temperature or the time until failure for a piece of equipment. To understand the working functionality of Linear Regression, imagine how you would arrange random logs of wood in increasing order of their weight. You have to guess its weight just by looking at the height and girth of the log (visual analysis) and arranging them using a combination of these visible parameters.

Artificial Neural Network and Deep Learning

They deliver data-driven insights, help automate processes and save time, and perform more accurately than humans ever could. Decision tree, also known as classification and regression tree (CART), is a supervised learning algorithm that works great on text classification problems because it can show similarities and differences on a hyper minute level. It, essentially, acts like a flow chart, breaking data points into two categories at a time, from β€œtrunk,” to β€œbranches,” then β€œleaves,” where the data within each category is at its most similar. This can be seen in robotics when robots learn to navigate only after bumping into a wall here and there – there is a clear relationship between actions and results.

how does machine learning algorithms work

While machine learning is a powerful tool for solving problems, improving business operations and automating tasks, it’s also a complex and challenging technology, requiring deep expertise and significant resources. Choosing the right algorithm for a task calls for a strong grasp of mathematics and statistics. Training machine learning algorithms often involves large amounts of good quality data to produce accurate results. The results themselves can be difficult to understand — particularly the outcomes produced by complex algorithms, such as the deep learning neural networks patterned after the human brain. Rule-based machine learning is a general term for any machine learning method that identifies, learns, or evolves “rules” to store, manipulate or apply knowledge. The defining characteristic of a rule-based machine learning algorithm is the identification and utilization of a set of relational rules that collectively represent the knowledge captured by the system.

Machine Learning

Unsupervised learning, also known as unsupervised machine learning, uses machine learning algorithms to analyze and cluster unlabeled datasets. These algorithms discover hidden patterns or data groupings without the need for human intervention. This method’s ability to discover similarities and differences in information make it ideal for exploratory data analysis, cross-selling strategies, customer segmentation, and image and pattern recognition.

how does machine learning algorithms work

The biggest challenge with artificial intelligence and its effect on the job market will be helping people to transition to new roles that are in demand. While a lot of public perception of artificial intelligence centers around job losses, this concern should probably be reframed. With every disruptive, new technology, we see that the market demand for specific job roles shifts. For example, when we look at the automotive industry, many manufacturers, like GM, are shifting to focus on electric vehicle production to align with green initiatives. The energy industry isn’t going away, but the source of energy is shifting from a fuel economy to an electric one. The all new enterprise studio that brings together traditional machine learning along with new generative AI capabilities powered by foundation models.

Artificial Intelligence & Machine Learning Bootcamp

Uses range from driverless cars, to smart speakers, to video games, to data analysis, and beyond. That list I just wrote is the bedrock of nearly every machine learning algorithm, so having this solid foundation will set you up for success in the long run. Comparing approaches to categorizing vehicles using machine learning (left) and deep learning (right). Consider using machine learning when you have a complex task or problem involving a large amount of data and lots of variables, but no existing formula or equation. Regression techniques predict continuous responsesβ€”for example, hard-to-measure physical quantities such as battery state-of-charge, electricity load on the grid, or prices of financial assets. Typical applications include virtual sensing, electricity load forecasting, and algorithmic trading.

A Machine Learning Algorithm Finds its First Supernova – Universe Today

A Machine Learning Algorithm Finds its First Supernova.

Posted: Tue, 17 Oct 2023 07:00:00 GMT [source]

Let’s dive into different kinds of machine learning and the most-used algorithms to get an idea of how machine learning works. Machine learning revolves around algorithms, which are essentially a series of mathematical operations. These algorithms can be implemented through various methods and in numerous programming languages, yet their underlying mathematical principles are the same. In today’s world, vast amounts of data are being stored and analyzed by corporates, government agencies, and research organizations.

Unlike supervised learning, which is based on given sample data or examples, the RL method is based on interacting with the environment. The problem to be solved in reinforcement learning (RL) is defined as a Markov Decision Process (MDP) [86], i.e., all about sequentially making decisions. An RL problem typically includes four elements such as Agent, Environment, Rewards, and Policy. Association rule learning is a rule-based machine learning approach to discover interesting relationships, β€œIF-THEN” statements, in large datasets between variables [7].

What is Clustering in Machine Learning? Definition from TechTarget – TechTarget

What is Clustering in Machine Learning? Definition from TechTarget.

Posted: Thu, 17 Aug 2023 19:14:40 GMT [source]

This article shows you a detailed look on how to become a machine learning engineer, what skills you will need, and what you will do once you become one. Let’s consider a program that identifies plants using a Naive Bayes algorithm. The algorithm takes into account specific factors such as perceived size, color, and shape to categorize images of plants. Although each of these factors is considered independently, the algorithm combines them to assess the probability of an object being a particular plant. Fueled by the massive amount of research by companies, universities and governments around the globe, machine learning is a rapidly moving target.

Training models

A supervised learning algorithm takes a known set of input data and known responses to the data (output) and trains a model to generate reasonable predictions for the response to new data. Use supervised learning if you have known data for the output you are trying to predict. When Rosenblatt first implemented his neural network in 1958, he initially set it loose on images of dogs and cats. By necessity, much of that time was spent devising algorithms that could detect pre-specified shapes in an image, like edges and polyhedrons, using the limited processing power of early computers.

how does machine learning algorithms work

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The Ministry of Education in El Salvador has embarked on a groundbreaking initiative in partnership with the non-profit organization Mi Primer Bitcoin (My First Bitcoin or MPB) to integrate Bitcoin education into the country’s public school curriculum by 2024. This innovative endeavor aims to equip educators with the necessary knowledge to introduce students to the world of cryptocurrency.

Collaboration with Mi Primer Bitcoin

Mi Primer Bitcoin, in collaboration with Bitcoin Beach, will play a pivotal role in assisting the Ministry of Education with this educational venture. MPB’s existing program, “My First Bitcoin,” will serve as a primary resource for the Bitcoin component of the curriculum. This program issues students a diploma of completion upon its conclusion.

Training for the pilot program is scheduled to commence on September 7th, with support from Bitcoin Beach. The initial phase will involve instructing 150 public school teachers from 75 different schools, providing them with a foundational understanding of Bitcoin. These teachers will later return to their respective schools to impart the curriculum developed by the Ministry of Education.

Global Expansion of Bitcoin Education

If the pilot program proves successful, the Ministry of Education plans to roll out Bitcoin education to every school in the country in the following year. As the first nation in the world to embrace Bitcoin as legal tender, El Salvador seeks to set a positive example for other countries, emphasizing the significance of quality education.

While the current focus is on El Salvador, MPB’s founder, John Dennehy, envisions a broader mission to bring Bitcoin education to the global stage. Already, MPB is in preliminary discussions with two other Latin American governments interested in implementing a similar Bitcoin education model for their students.

Impacting Thousands of Students

The impact of Bitcoin education in El Salvador is already noticeable, with over 25,000 students having learned about Bitcoin in their classrooms through initiatives like Bitcoin Beach. This pioneering effort in public Bitcoin education is being closely watched by the international community.

El Salvador’s commitment to introducing Bitcoin education in schools signifies a significant leap forward in the adoption and understanding of cryptocurrencies. As other nations express interest in following suit, the world is witnessing the potential for Bitcoin education to become a global phenomenon, bridging the knowledge gap in the ever-evolving digital financial landscape.

 

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