Tag: Market Wrap

This Crypto Fund Manager Claims Bitcoin Drop Was “Capitulation”

by NEWSBTC

It’s widely believed that even experts can only identify capitulation after it’s already happened. The thing is, in regulated markets, unscrupulous Billionaires/ Bond villains have the decency to manipulate the market behind closed doors. Traditional markets don’t have as strong a sign as infamous Elon’s tweet. 

The CEO of investment advisory firm Vailshire Capital Management, Dr. Jeff Ross, proposes the theory that Elon’s attack on the Bitcoin network generated a “short-term capitulation.” That means, everybody who was ready to sell their Bitcoin at the slight sign of trouble, already did it. The weak hands and short-term traders are out of the game.

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Is this Bitcoin’s new bottom?

Of course, so far, the capitulation is just a theory. We can’t really be sure. But, if this is what’s happening, that also means that we’re seeing the new bottom of the Bitcoin market. And other indicators point in that direction. Capriole investment’s founder Charles Edwards identified a dip below 100 Simple Moving Average yesterday, which usually means one thing.

This, of course, has happened before. After 2020’s Bitcoin halving, capitulation hit the market and NewsBTC was there to ease everyone’s minds:

While “capitulation” sounds scary, especially since it has been affiliated with the late-2018 Bitcoin crash, it’s not exactly a bad thing.

As prominent finance podcaster and Bitcoin bull Preston Pysh explained in response to D’Souza’s analysis:

“During the 2016 halving, the price went sideways for 9 days and then had a 28% drop, and it took 100 days to get back to the halving price. Mentally prepare yourself for the efficiency cleansing and difficulty adjustment as the protocol prepares all passengers for launch.”

Related Reading | Was Bitcoin Crash Orchestrated? These 4 Theories Scream Beware

So, summarizing, if capitulation happened and we’re watching a new bottom, we might see the world’s favorite digital asset bounce and climb to new and incredible heights.

BTCUSD chart for 05/15/2021 - TradingView

BTCUSD chart for 05/15/2021 - TradingView


BTC price chart on Bitstamp | Source: BTC/USD on TradingView.com

How will Bitcoin bounce after such a catastrophic capitulation?

This is the easiest question to answer. And with it, we can also answer another burning question: Did Tesla not do their due diligence before investing more than $1B in BTC? Did Elon just find out about the supposed dangerous levels of energy consumption that the Bitcoin network needs to secure itself? Probably not.

For a possible explanation, we give the mic to Mark Yusko, Morgan Creek Capital Management’s CEO:

Related Reading | Lesson Learned: Teacher Loses Life Savings To Elon Musk Bitcoin Scam

Bitcoin will bounce back with institutional money snatching every coin from scared retail investor’s hands. In fact, the process is probably already happening.

Other theories about Elon Musk’s possible motives include Tesla trying to get tax breaks from the US government’s green policies and that this is the rollout for a renewable-energy-powered mining rig. To learn more about both, jump to our sister site Bitcoinist.

Featured Image by ShutterStock - Charts by TradingView

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Bitcoin Supply Lights Up With Activity Due To Trading Range Boredom

by NEWSBTC

This three-months-and-counting consolidation period Bitcoin is in has many investors with the finger on the trigger. Even though we’re in the middle of an Altseason of sorts, mainly caused by the lack of price fluctuation Bitcoin is exhibiting, the hunters seem to be ready. A recent Arcane Research report shows that, in the last year, a whopping 8.45 million BTC have circulated. That’s 45% of the total circulating supply changing hands or, at least, wallets.

The last active supply circulation peak happened on February 23rd, 2018. At that time, 59% of the total was moving around. That was two months after the peak of the bull market. But, as Arcane Research points out, “We are still far away from the peak of the 2017-2018 era, both in terms of percentage and also in absolute values.” This means we could be on the verge of a new high octane ride.

Bitcoin active supply on the rise, chart

Bitcoin active supply on the rise, chart


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Bitcoin is on the move | Source: Arcane Research

The larger the consolidation period, the bigger the uptrend

On a previous time that Bitcoin’s price flatlined, NewsBTC reported on an analyst’s prediction that came true with a vengeance.

Bitcoin could be on the cusp of seeing some massive momentum in the mid-term.

He is even setting his sights on a move to $40,700, which may act as short-term resistance.

“This consolidation on $btc has given more breathing room for our *allowed* mean reversion cushion. We could pump to 40.7k and still be within the accepted reversion band level above the basis. TLDR: Bullish on more upside for bitcoin soon.”

And over at our sister site Bitcoinist, they reported on a prediction of an imminent long-squeeze that also came true:

Bitcoin’s short-term upside potential is currently being hampered by the high funding rates for leveraged positions.

This could indicate that being long is an incredibly crowded trade and that a Bitcoin long-squeeze is imminent.

“TWAPs & daily opens seem to be really important these days. Funding is getting pretty high again though, so I don’t think there’s a whole lot of room for further upside.”

When the price fell, liquidations were brutal and wiped out Billions worth of contracts. The futures market broke all kinds of liquidation records, as traders were clearly overleveraged. That means that the road is clear. And the fear of inflation is not going anywhere:

The richest individuals in the world are now buying Bitcoin to prevent their wealth from evaporating into thin air. And if inflation expectations are only now breaking out from a ten-year downtrend, Bitcoin’s uptrend might only just be getting started.

BTCUSD 05/12/2021 - TradingView

BTC price chart on Bitbay | Source: BTC/USD on TradingView.com

Are we being too optimistic?

Despite all those signs, nothing’s guaranteed. The trading range has been thin for months and Bitcoin’s current active supply might be on the move, but other factors might be at play. And, as NewsBTC reported, a “reset” might come sooner than later. 

According to cryptocurrency analyst Dave the Wave, who has supplied accurate analysis to the community through his Twitter soapbox for years now, Bitcoin could be looking at a strong “reset.”

Things might have taken off too quickly and too powerfully for Bitcoin price this time around, causing the LMACD to become overextended and brushing up against a long-term trendline.

It should be noted that Dave the Wave thinks that, after the possible reset, we’re “off to the races again.” So, the point is that even though the sea seems calm right now, we’re bound to see incredible action soon. The stage is set for a storm of epic proportions. And Bitcoins are moving around waiting for the right time to… move even more.

Featured Image by alessandro fazari on Unsplash - Charts by TradingView

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Market Wrap: Bitcoin Rallies On After Passing $50K Psychological Level to $52K

by Coindesk

Bitcoin broke above $52,000 Wednesday, with a market capitalization nearing $1 trillion.

  • Bitcoin (BTC) trading around $52,231.69 as of 21:00 UTC (4 p.m. ET). Gaining 7.16% over the previous 24 hours.

  • Bitcoin’s 24-hour range: $48,430.80-$52,536.47 (CoinDesk 20)

  • BTC trades above its 10-hour and 50-hour averages on the hourly chart, a bullish signal for market technicians.

Bitcoin trading on Bitstamp since Feb. 15.

Source: TradingView

Bitcoin trading volume on major exchanges.

Source: CoinDesk

Bitcoin is in “uncharted territory,” said Hunain Naseer, senior editor at OKEx Insights, after its price surged to a new all-time high above $52,000, only a day after it passed the key psychological threshold of $50,000.

Price volatility remains high when compared with major macro assets including the Standard & Poor’s 500 Index of stocks, gold and bonds.


Source: CoinDesk Research, St. Louis Fed, Yahoo Finance

“We can expect some consolidation between $50,000 and $52,000, with a possible retest of the $49,000 support,” Naseer added.


Read More: Bitcoin Poised for Short-Term Gains Past $51K as MicroStrategy Upsizes Debt Deal

One bullish signal: a large amount of stablecoin reserves on cryptocurrency exchanges, according to data from South Korea-based crypto data firm CryptoQuant. That could show traders moving stablecoins into place so they can buy quickly if the price is right.


“So many stablecoins in exchanges” compared with bitcoin held on exchanges, Ki Young Ju, CEO of CryptoQuant, told CoinDesk, pointing out that selling pressure is relatively low.

The ratio of bitcoin reserved on all exchanges and all stablecoin held on all exchanges has declined since the beginning of the year.

Source: CryptoQuant

In the derivatives market, bitcoin futures on the Chicago-based CME logged a record high single-day trading volume and total interest on Tuesday, according to data from blockchain analytics site Skew. The elevated activity could be an indicator of rising bitcoin demand from institutional investors.


Source: Skew

Institutional interest in bitcoin is also reflected in another market indicator called the Coinbase premium, a measurement of the price difference between Coinbase Pro’s BTC/USD pair and Binance’s BTC/USDT pair, said CryptoQuant’s Ki. The number flipped positive on Wednesday.

“Coinbase [U.S. dollar] whales are like gatekeepers” of the bull market, Ki said of investors with large holdings.

Ether consolidates, institutional interest in futures rises

Ether (ETH), the second-largest cryptocurrency by market capitalization, was up Wednesday, trading around $1,828.15 and climbing 4.45% in 24 hours as of 21:00 UTC (4:00 p.m. ET).

On the technical side, ether is in a consolidation phase after losing short-term momentum, according to Katie Stockton, a technical analyst for Fairlead Strategies.

“I view the consolidation as healthy within the context of its steep uptrend,” Stockton said. “The 20-day moving average at $1,556 is a gauge of initial support.”


Read more: Coinbase, Readying for Public Listing, Gets $77B Valuation From Nasdaq Private Market

Ether’s correlation with bitcoin has been flat this month at around 0.68, after it moved down to as low as 0.55 in January.

“As long as bitcoin stays above $49,000 we can expect a rally in the altcoins, including ether,” OKEx Insights’ Naseer said. “But that will only happen when bitcoin’s volatility drops a little.”


Source: CoinDesk

At the same time, institutional interest in ether futures has grown significantly, according to data provided by blockchain analytics firm Glassnode.


Source: Glassnode

“One week after ether futures launched on CME, daily trading volume reached a total of $75.8 million yesterday – almost doubling Friday’s volume of $40 million,” Glassnode wrote in a tweet Wednesday. “Meanwhile, open interest has increased to $62 million.”

The launch of the CME’s new ether futures contract last week might be one reason why ether’s price has underperformed, said trader and analyst Alex Kruger.

Read more: Ethereum’s Favorite Lossless Lottery Will Airdrop Its POOL Token Today


“Ether is a high beta asset to bitcoin, and it is supposed to move in line,” Kruger said. “Sometimes its own set of technical and or fundamental drivers kick in and make price trajectories or performance differences.”

Other markets

Digital assets on the CoinDesk 20 are mostly in green Wednesday. Notable winners as of 21:00 UTC (4:00 p.m. ET):


Notable losers:




Commodities:

  • Oil was up 0.37%. Price per barrel of West Texas Intermediate crude: $61.22.

  • Gold was in the red 1.09% and at $1775.03 as of press time.

Treasurys:

  • The 10-year U.S. Treasury bond yield fell Wednesday dipping to 1.286%.

The CoinDesk 20: The Assets That Matter Most to the Market




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Market Wrap: Bitcoin Remains Around $48.5K Amid Flat Trading Activity

by Coindesk

Bitcoin faced choppy markets for most of Tuesday after briefly trading above $50,000 for the first time during early U.S. trading hours. With some remaining bullish, other analysts and traders warned about near-term price correction.

  • Bitcoin (BTC) trading around 48,810.95 as of 21:00 UTC (4 p.m. ET). Gaining 0.39% over the previous 24 hours. 

  • Bitcoin’s 24-hour range: $47,088.84-$50,584.85 (CoinDesk 20)

  • BTC between its 10-hour and 50-hour averages on the hourly chart, a sideway signal for market technicians.

Bitcoin trading on Bitstamp since Feb. 13.

Source: TradingView

Bitcoin volumes on major crypto exchanges since January.

Source: CoinDesk, CryptoCompare

Bitcoin’s trading volumes on the eight leading crypto exchanges tracked by the CoinDesk 20 remained flat on Tuesday, at roughly half of where it was on Monday on Feb. 8. Meanwhile, data from Glassnode shows that bitcoin’s balance on exchanges continues to drop, a bullish sign taken by some analysts.

Bitcoin balance on all exchanges.

Source: Glassnode

“We are at all-time-highs territory [and] the market still has to make up its mind” about next resistance or supporting levels, Alessandro Andreotti, bitcoin over-the-counter broker, told CoinDesk. “My opinion is that new highs [are coming] in the short term.”


This is happening as retail investors are showing growing interest in the derivatives market. 

According to Arcane Research, March futures bitcoin contracts on the retail-focused platforms currently have an annualized premium rate averaging 44.16%. That outpaces those on the institution-driven CME, which shows an average of 24.39%.

“There continues to be net inflows into crypto, particularly into futures,” Sam Bankman-Fried, CEO of crypto derivatives exchange FTX, told CoinDesk. “[And] people inside crypto continue to be particularly bullish.”


Others, however, warn about near-term price correction, especially if there is a lack of fresh catalysts on top of Tesla’s $1.5 billion bitcoin purchase that was announced last week.

“The market has gone parabolic since breaking through $20,000 and technical studies are warning of the need for a healthy pullback in the days and weeks ahead to allow for severely stretched readings to unwind and normalize,” said Joel Kruger, cryptocurrency strategist at institution-focused crypto exchange LMAX Digital.

“The $50,000 price level is now relatively high for retail investors, and it is not easy for them to chase after,” Simons Chen, executive director of investment and trading at Hong Kong-based crypto lender Babel Finance, told CoinDesk. He added there was little chance retail investors will be able to push bitcoin’s price above the current record high price in the short-term period.

On its Telegram channel, Singapore-based QCP Capital also expressed a tempered view on the short-term price movement, saying that, historically, bitcoin’s price trended lower in March due to seasonality. 

“The longer bitcoin stalls here without a fresh catalyst, the more we will be looking for a longer lasting downside into March. As we’ve highlighted before, the March downside seasonality followed by April upside seasonality is the strongest and most consistent seasonal pattern in bitcoin,” QCP Capital wrote. “It’s still too early now for us but into [the end of February,] if volumes drop further, we will be looking for some downside protection [at the end of March.]”

One possible spur for the markets, as CoinDesk reported, is that business intelligence firm MicroStrategy is preparing to purchase more bitcoin. As well, Los Angeles-based privately held investment firm Wedbush Securities said that bitcoin could expect more corporate ownership and adoption after Tesla’s bitcoin investment, meaning that the “fresh catalyst” QCP mentioned could still be imminent.

Ether moves little as DeFi sees small drop amid flash loan attacks

The second-largest cryptocurrency by market capitalization, ether (ETH) was down Tuesday, trading around $1,754.31 and down 4.07% in 24 hours as of 21:00 UTC (4:00 p.m. ET).

Ether’s price has mostly stuck below $1,800 on Tuesday. This has led ether futures traders to close their positions, as what gains they’re able to eke out were eaten by the funding cost they pay for their contract, according to Vishal Shah, an options trader and founder of derivatives exchange Alpha5.


“People are now in the habit of expecting prices to climb as if it’s a foregone conclusion,” Shah said. At the same time, the decentralized finance (DeFi) sector, which is mostly based on the Ethereum blockchain, continues to grow. However, one wrinkle occurred over the past weekend when a flash loan exploit on Cream Finance and Alpha Finance caused a loss of funds totaling $37.6 million and resulting in a slight decline of the total value locked in DeFi.

Other markets

Digital assets on the CoinDesk 20 are mostly in red Tuesday. Notable winners as of 21:00 UTC (4:00 p.m. ET): 


Notable losers:




Commodities:

  • Oil was up 1.23%. Price per barrel of West Texas Intermediate crude: $60.20.

  • Gold was in the red 1/27% and at $1794.97 as of press time.

Treasurys:

  • The 10-year U.S. Treasury bond yield climbed Tuesday jumping to 1.294%.

The CoinDesk 20: The Assets That Matter Most to the Market




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Market Wrap: Ether Sets New Highs as Bitcoin Stays Below $49K

by Coindesk

The price of bitcoin struggled to regain $49,000 Friday, continuing to bounce between $48,000 and $46,000 heading into the weekend. As bitcoin contemplated which way to go, ether made a new all-time high above $1,850. 

Much of bitcoin’s choppy price action could be attributed to futures deleveraging as eager bulls piled into long trades expecting a swift breakout to $50,000 or higher. Funding rates for perpetual bitcoin futures have steadily increased through February, according to market data collected by Skew, with some funding rates reaching their highest levels in the past 12 months.

High positive funding rates signal an increase in long positions, whereas negative rates indicate a more bearish sentiment. The market tends to reset when traders, especially in overcrowded derivatives positions, become overly bearish or bullish. 

In the past 24 hours, over $330 million worth of bitcoin futures contracts were liquidated, according to market data from Bybt. Most of the liquidated positions were longs.

Despite the choppy price action, news over the past few days has been extraordinarily bullish for the leading cryptocurrency. In one week, Tesla bought $1.5 billion worth of bitcoin, Twitter’s CFO said the company is considering investing in the cryptocurrency, BNY Mellon announced plans to custody bitcoin for its clients, and PayPal confirmed its plans to add crypto to its Venmo product.

Ether (ETH), the second-largest cryptocurrency by market capitalization, was up Friday trading around $1,850 and climbing 3% in 24 hours as of 21:00 UTC (4:00 p.m. ET).

As it set new record highs above $1,850, other decentralized finance-related (DeFi) cryptocurrencies followed suit, with some even outperforming ether. The DeFi sector in aggregate rallied over 5% in the past 24 hours, according to Messari, led by Uniswap, yearn.finance and others, which gained by double-digit percentages. 

Ether’s fresh highs come the same week the CME launched its ether futures market, which some traders anticipated would be a bearish catalyst for the market. The expectations were almost exclusively pinned to the ominous timing of bitcoin’s peak in 2017 near the launch of CME’s bitcoin futures market. Yet, so far the bearish thesis has not played out. 

Since CME’s futures launch, ether has rallied over 12%. The product has had a quiet start, with less than $200 million worth of contracts traded this week. In contrast, Binance’s ether futures have traded nearly $40 billion worth this week.

Digital assets on the CoinDesk 20 are mainly green Friday. Notable winners as of 21:00 UTC (4:00 p.m. ET):

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Market Wrap: Bitcoin Near $48K While Ether Transaction Fees Surge Again

by Coindesk

Bitcoin was trading between $47,000 and $48,000 for much of Thursday, breaking the $48,000 level multiple times throughout Thursday. Traders and analysts told CoinDesk they remain bullish on the overall market, as institutional investors’ interest in bitcoin is growing “at a staggering pace.”

  • Bitcoin (BTC) trading around $47,174.04 as of 21:00 UTC (4 p.m. ET). Gaining 5.48% over the previous 24 hours.

  • Bitcoin’s 24-hour range: $44,057.64-$48,635.84 (CoinDesk 20)

  • BTC above its 10-hour and 50-hour averages on the hourly chart, a bullish signal for market technicians.

Bitcoin trading on Coinbase since Feb 5.

Source: TradingView

Despite bitcoin’s new historical high price earlier Thursday, the trading volume on the eight exchanges tracked by the CoinDesk 20 remains low compared with earlier this week.

Bitcoin volumes on major crypto exchanges since January.

Source: CoinDesk, CryptoCompare

The focus of the market on Thursday was on the news that more big players are embracing bitcoin; Mastercard said it will allow merchants to receive payments in cryptocurrency soon, and BNY Mellon announced it will launch a new digital custody unit.


“To put it simply, it’s really hard to be bearish on bitcoin right now … and you don’t even need to look too deeply at all of the fundamental metrics and technical indicators to feel that,” said Adam James, senior content editor at OKEx’s research arm OKEx Insights.

“The market is bullish,” Denis Vinokourov, head of research at digital assets broker Bequant, said. “There are no immediate fundamental factors that would drive the price down.”

Read More: Mastercard Will Let Merchants Accept Payments in Crypto This Year


That said, bitcoin is struggling to push higher after it briefly went above $48,000 earlier Thursday, according to Chad Steinglass, head of trading at CrossTower. He told CoinDesk that in the short term, the resistance level would remain at or just below $50,000.

The nearest upside hurdle will be higher, at around $53,000, according to Katie Stockton, a technical analyst for Fairlead Strategies. She also pointed out that some overbought and oversold activity will support up to two months of price consolidation.

In the longer term, said John Kramer, trader at market maker GSR, it is “realistic” to think that bitcoin’s on a “healthy” run towards $100,000 by the end of the summer.

“Expect more banks to offer custody and additional products, as well as other companies to follow Tesla and MicroStrategy’s lead,” Kramer said. “On top of this, there’s still additional stimulus on the table, which is what kicked off this rally last spring.”

However, in the derivatives market, options traders don’t appear convinced bitcoin will rally to $100,000 anytime soon. Based on current prices, the market has assigned a 12% probability this price be reached before the end of this year, as CoinDesk reported.

Ethereum killers are killing it, as Ethereum gas fee surges

The second-largest cryptocurrency by market capitalization, ether (ETH), was up Thursday, trading around $1,769.03 and climbing 2.75% in 24 hours as of 21:00 UTC (4:00 p.m. ET).

On the technical side, Joel Kruger, cryptocurrency strategist at exchange LMAX Digital, said the initial resistance level would be the earlier all-time high at around $1,840 on Wednesday.


“A break above [$1,840] will open the door for a test of massive resistance at $2,000, which represents a critical psychological barrier and measured move upside extension,” Kruger said. “We see the first level of support at $1,680, with a break below to take the immediate pressure off the topside and open the door for a correction back down towards the $1,500 area.”

Ether’s rally is not just simply following bitcoin’s price trend, according to analysts. It is largely driven by the fast-growing decentralized finance sector.

“As these [DeFi] projects continue to gain in popularity, we will likely see increased interest in ether,” Guy Hirsch, U.S. managing director at eToro, told CoinDesk. “It would not be surprising to see it make a run at $2,000 soon.”

At the same time, significant growth of the “Ethereum Killers,” including Cardano, Polkadot, Solana, and Algorand, is a reflection of the frustration around the high gas fees on the Ethereum blockchain. Gas refers to the internal pricing unit for running transactions on Ethereum.

Read More: Cardano, Polkadot Market Caps Surpass XRP as Some Bet on Alternatives to Ethereum

Total transaction fees of Ethereum denoted in U.S. dollars in the past six months.

Source: Glassnode

“The high gas fees on Ethereum are clearly presenting opportunities to competing layer 1 smart contract platforms,” said Jason Lau, chief operating officer at San Francisco-based crypto exchange OKCoin. “As Ethereum continues through its multi-year process of launching Eth 2.0 to address its scaling issues, it remains to be seen whether developers will migrate their apps to other platforms.”

Others, however, dismissed any threats to Ethereum.


“The price performance [of “Ethereum killers”] does not necessarily mean there is a real threat to derail Ethereum’s dominance,” Vinokourov said. “In fact, the DeFi market continues to grow, and with it so does ether.”

Other markets

Digital assets on the CoinDesk 20 are mostly in green Thursday. Notable winner as of 21:00 UTC (4:00 p.m. ET):


Notable losers:




Commodities:

  • Oil was down 1.26%. Price per barrel of West Texas Intermediate crude: $57.94.

  • Gold was in the red 0.94% and at $1825.71 as of press time.

Treasurys:

  • The 10-year U.S. Treasury bond yield climbed Thursday in the green 1.162%.

The CoinDesk 20: The Assets That Matter Most to the Market




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Market Wrap: Bitcoin Hits Record $48.2K as CME Ether Futures at $33M Volume on First Day

by Coindesk

Bitcoin and ether surpassed Monday’s price records. In ether’s case, CME’s futures launch has given the asset more credibility than ever before.

  • Bitcoin (BTC) trading around $47,174 as of 21:15 UTC (4:15 p.m. ET). Gaining 7.1% over the previous 24 hours.

  • Bitcoin’s 24-hour range: $43,948-$48,226 (CoinDesk 20)

  • BTC well above the 10-hour and the 50-hour moving average on the hourly chart, a bullish signal for market technicians.

Bitcoin trading on Bitstamp since Feb 6.

Source: TradingView

Bitcoin’s price is in mega-bull mode again Tuesday. For the second day in a row, the price per 1 BTC hit a new all-time high, $48,226, according to CoinDesk 20 data. 

“Bitcoin’s rush from $38,000 to a high of $48,000 marks a new all-time high, blasting through the previous all-time high set a month ago, and reignites the recent bull run,” noted Jason Lau, chief operating officer for San Francisco-based cryptocurrency exchange OKCoin.

Bitcoin’s historical price the past three months.

Source: CoinDesk 20

“Elon [Musk] and Tesla’s [bitcoin] purchase of $1.5 billion and accepting bitcoin as payment is now the largest confirmation of a trend months in the making – corporations are worried about their cash reserves losing value and are taking concrete actions to diversify into bitcoin,” added Lau. 


Read More: Bitcoin Could Rally Further as Tesla Leads Corporates on Treasury 

“Tesla’s $1.5B boost provides us a great example of leadership that will eventually push other S&P 500 companies to allocate part of their treasury reserve into bitcoin,” predicted Constantin Kogan, partner at crypto investment firm Wave Financial. 


Kogan made an extremely optimistic forecast to CoinDesk. “If all S&P 500 companies allocate at least 1% of their treasury, the price of bitcoin would increase by about $40,000.”

Top 10 publicly traded companies by bitcoin holdings.

Source: Bitcoin Treasury Reserve

Interestingly enough, with all this bullish bitcoin activity, the ETH/BTC pair has gone bearish. It’s a sign traders are selling ether for bitcoin, with a particularly large red selling candle at 12:00 UTC Monday when BTC jumped on the Tesla news.

The spot ETH/BTC pair on Coinbase since Feb 6.

Source: TradingView

“Bitcoin having just hit all-time highs again, we might have a bit of a pullback for all tokens,” noted Andrew Tu, an executive at quant trading firm Efficient Frontier. ”In general though, the market looks bullish. It seems like bitcoin dominance is due to make another brief run upwards again as it’s hard to see alts (especially DeFi) continue to perform like they have recently without a break.”

On Tuesday, bitcoin’s dominance, its percentage of the larger crypto market share, has jumped. At one point it was up 2% for February and as of press time it is sitting at 0.94%.

Bitcoin dominance in February.

Source: TradingView

Jean-Baptiste Pavageau, partner at ExoAlpha, told CoinDesk not to dismiss ether (ETH), the native asset of decentralized finance (DeFi) network Ethereum, during this run because it is also making gains Tuesday. “DeFi definitely fuels up the use of the Ethereum network and its leadership as one of the pillars of the future of finance.”

Ether futures volume $33 million first day on CME

Ether (ETH), the second-largest cryptocurrency by market capitalization, was up Tuesday, trading around $1,769 and climbing 3.1% in 24 hours as of 21:15 UTC (4:15 p.m. ET). The digital asset hit a fresh all-time high Tuesday of $1,824, according to CoinDesk 20 data. 

“We expect some exhaustion on ether coming from the price itself, above $2,200, but also from the fees to use the network itself while solutions are being built to tackle this issue,” said Jean-Baptiste Pavageau, partner at quantitative trading firm ExoAlpha.


Read More: Ether Hits $1,800 for First Time as Market Cap Passes $200B

Monday was the first day for ether futures contracts on the commodity bellwether Chicago Mercantile Exchange. In total, there were 388 ether contracts traded by volume on the day. Each contract is 50 ETH each. At CME’s closing reference rate Monday of $1,732, there was $33.6 million in volume the first day, with $19.7 million in open interest at the close. 

Investors will be keeping an eye on this market. Outside of CME, ether futures are already an almost-$6 billion market, with Binance leading the way with $1.3 billion in open interest Monday.

Ether futures open interest the past month.

Source: Skew

“This is a big milestone for Ethereum and ether from several different angles,” noted Stefan Coolican, chief financial officer of Ether Capital, of the CME launch. “First, it provides clarity on ether as a commodity like bitcoin; second, it gives institutions a well-known and accessible way to access ether exposure; third, it provides another tool for price discovery that helps investors and regulators better assess market dynamics.”

Other markets

Digital assets on the CoinDesk 20 are mostly green Tuesday. Notable winners as of 21:15 UTC (4:15 p.m. ET):


Notable losers:


Read More: BlockFi’s Bitcoin Trust Takes Aim at GBTC



Commodities:

  • Oil was up 0.52%. Price per barrel of West Texas Intermediate crude: $58.38.

  • Gold was in the green 0.33% and at $1,836 as of press time.

  • Silver is gaining, up 0.30% and changing hands at $27.22.

Treasurys:

  • The 10-year U.S. Treasury bond yield fell Monday to 1.155 and in the red 1.4%.

The CoinDesk 20: The Assets That Matter Most to the Market




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Market Wrap: The ‘Elon Effect’ Blasts Bitcoin to $44.8K While Ether Moons

by Coindesk

Bitcoin’s price is getting closer to Mars thanks to Elon Musk while ether moons to a new record. Investors are pulling BTC out of DeFi, likely to diversify their profits.

  • Bitcoin (BTC) trading around $44,023 as of 21:00 UTC (4 p.m. ET). Climbing 14.5% over the previous 24 hours.

  • Bitcoin’s 24-hour range: $38,051-$44,801 (CoinDesk 20)

  • BTC well above the 10-hour and the 50-hour moving average on the hourly chart, a bullish signal for market technicians.

Bitcoin trading on Bitstamp since Feb 5.

Source: TradingView

Bitcoin’s price hit a record-high price Monday, soaring to $44,801 at around 13:00 UTC (8 a.m. ET). It’s one month to the day since hitting the previous record of $41,375, according to CoinDesk 20 data.

Bitcoin’s historical price the past month.

Source: CoinDesk 20

One catalyst for the price run-up: Entrepreneur Elon Musk’s Tesla (TSLA) plowed $1.5 billion into the cryptocurrency. The company also said it would accept bitcoin for goods and services rendered. 


Read More: Tesla Invests $1.5B in Bitcoin, Plans to Accept Crypto Payments

“All bets are off the table now. I was worried that [at] around $35,000-$40,000 we were not seeing a huge amount of institutional flows, and over the weekend the market moved higher in a fairly weak fashion,” noted Chris Thomas, head of digital assets for. Swissquote Bank. “But Tesla would have bought over the last few weeks, a little every day.”

Since the start of 2021, bitcoin spot exchange volumes by eight major exchanges tracked by the CoinDesk 20 have been higher than its six-month average. 


This year so far, average trading on these exchanges has been $4.4 billion per day; going back to Aug. 8, 2020, the daily average has been $1.7 billion. As of press time Monday, volume is also higher than that 2021 average, at over $6.7 billion.

Major spot bitcoin volumes by exchange the past six months.
(Shuai Hao)

Source: CoinDesk Research

“Bitcoin is at new highs today in ‘frenzied’ buying, clearing minor resistance from January,” said Katie Stockton, a technical analyst at Fairlead Strategies. Stockton also noted bitcoin has lost steam since its Musk-motivated rally, at $44,023 as of press time. “Signs of exhaustion are associated with today’s steep rally from an overbought/oversold perspective,” she said.

However, the trend remains bullish, Stockton added. “Despite the potential for additional short-term volatility, the long-term uptrend appears healthy behind bitcoin from a momentum perspective.“ 

While some may be skittish about bitcoin’s rise in 30-day volatility over the past three months, other types of traders are certainly enthusiastic about it.

30-day bitcoin volatility over the past three months.
(Shuai Hao)

Source: CoinDesk Research

“Tesla buying bitcoin was a mostly predictable move, given the vocal support it has seen from CEO Elon Musk,” said Guy Hirsch, U.S. managing director at eToro.

Read More: Ex-OCC Chief Brooks Calls Tesla’s Bitcoin Buy a Bit ‘Scary’ for Rest of World

“If more companies begin making similar announcements, $50,000 could potentially be within reach during the next few months,” Hirsch added. 


“We think we’re only just scratching the surface when it comes to corporate and institutional participation in the world of bitcoin and cryptocurrencies,” Joel Kruger, cryptocurrency strategist at LMAX Digital, told CoinDesk. “We suspect that moves from visionaries like Tesla will only serve to reinforce the tremendous value proposition that decentralized assets have to offer.”

Ether at new high as BTC investors pull out of Ethereum protocol

Meanwhile, ether (ETH) is also hitting records and the asset’s correlation with bitcoin has cropped back up to levels not seen since December. 

Bitcoin and ether 90-day correlation the past six months.
(Shuai Hao/CoinDesk Research)

Source: CoinDesk indexes

The second-largest cryptocurrency by market capitalization was up Monday trading around $1,720 and climbing 8.5% in 24 hours as of 21:00 UTC (4:00 p.m. ET). The price hit a fresh all-time high Monday, hitting $1,776, according to CoinDesk 20 data. 

Read More: Ethereum Futures Are Now Trading on CME

The amount of bitcoin held in Ethereum-based decentralized finance, or DeFi, has dropped almost 3.5% Monday, going from over 50,000 to 48,344 BTC as of press time, according to data aggregator DeFi Pulse.

Bitcoin locked in decentralized finance the past three months.

Source: DeFi Pulse

Swissquote’s Thomas notes that Monday may be a day for larger players to start moving some bitcoin around because a fresh bitcoin price high might induce some investors to diversify their profits. 

“Larger hedge funds, etc., [that] had got into bitcoin between $15,000-$20,000 would naturally want to take profits around $45,000-$50,000″ for a profit of 2.5-3x. “I’ve always viewed that as a hard challenge,” Thomas told CoinDesk.

Other markets

Digital assets on the CoinDesk 20 are all in the green Monday. Notable winners as of 21:00 UTC (4:00 p.m. ET):




Commodities:

  • Oil was up 1.9%. Price per barrel of West Texas Intermediate crude: $58.03.

  • Gold was in the green 0.95% and at $1,830 as of press time.

  • Silver is gaining, up 1.9% and changing hands at $27.32.

Treasurys:

  • The 10-year U.S. Treasury bond yield climbed Monday to 1.169 and in the green 0.15%.

The CoinDesk 20: The Assets That Matter Most to the Market




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Market Wrap: Bitcoin Rises to $38.3K While Ether’s New High Takes Spotlight

by Coindesk

Bitcoin made some gains Friday, but ether hit another brand-new price high ahead of CME’s ether futures launching on Monday.

  • Bitcoin (BTC) trading around $37,751 as of 21:00 UTC (4 p.m. ET). Gaining 0.32% over the previous 24 hours.

  • Bitcoin’s 24-hour range: $36,637-$38,332 (CoinDesk 20)

  • BTC below the 10-hour but above the 50-hour moving average on the hourly chart, a sideways signal for market technicians.

Bitcoin trading on Bitstamp since Feb 2.

Source: TradingView

The price of bitcoin is now in the fourth day of an upward trend, going as high as $38,332 at 14:00 UTC (9 a.m. ET) before losing some steam heading into the weekend. It was down to $37,751 as of press time.

“Similar to the last bull run, we are seeing bitcoin initially steal the attention as retail adoption pours in through mainstream attention,” said Michael Gord, chief executive officer for trading firm Global Digital Asset. 


However, Gord told CoinDesk traders are rotating out of bitcoin to  high-flying digital assets. “Bitcoin then cools off and profits generated from bitcoin find themselves first in ether, then in other high market-cap digital assets,” Gord said.

Read More: Dalio to Offer Alt-Cash Fund, Says ‘Bitcoin Won’t Escape Our Scrutiny’

Nevertheless, fresh interest such as from Ray Dalio’s Bridgewater Associates, which manages $150 billion in investor money, has some including quantitative trading firm QCP Capital highly bullish on bitcoin. 


“Bridgewater’s piece out last week had a sensitivity analysis which showed their estimates of BTC price, should private holders of gold switch to BTC,” states QCP’s weekly investor note Friday. “They forecasted that should 50% of capital in gold move into BTC, that would result in a price of $85,000 per 1 BTC.”

Comparing bitcoin with traditional asset classes.
(Shuai Hao/CoinDesk)

Source: CoinDesk Research, St. Louis Fed, Yahoo Finance

Investors are certainly looking to crypto as an asset class, but bitcoin is still quite volatile; its 30-day volatility from Thursday’s close is at 102.9% on an annualized basis whereas gold is at 16%. 

Yet, crypto advocates see bitcoin and ether (ETH) similar to different asset classes, according to Joel Edgerton, chief operating officer of cryptocurrency exchange BitFlyer USA. “My guess is that BTC is like gold and priced by the value it stores, a scarce commodity in price discovery,” Edgerton said. “ETH is more like a stock and priced by the value it delivers (ETH 2.0, network effects, basis for DeFi).” He said he thinks of ether as an exchange-traded fund (ETF) for decentralized finance. 

While bitcoin has performed well so far in 2021 – it’s up 29% – ether’s returns have more than quadrupled, gaining 129%.

Bitcoin (orange) versus ether (blue) on Bitstamp.

Source: TradingView

“Ether is surging largely on the back of the growth in decentralized finance projects that rely on ERC-20 tokens to operate,” Guy Hirsch, managing director of U.S. for eToro. “Since ETH has not previously traded this high, it’s hard to tell what kind of support there is but, should DeFi projects continue to grow at the rate they are, it would be hard for ETH to not also continue setting new records.”

One thing to watch during a heated ether market is the ETH/BTC trading pair. A rise in this market signals traders are selling their bitcoin for ether; it has appreciated over 75% in 2021.

The ETH/BTC trading pair on Coinbase in 2021.

Source: TradingView

“While bitcoin consolidates and trends back towards all-time highs, much of the price action has focused on the ETH and DeFi space,” said Jason Lau, chief operating officer of San Francisco-based crypto exchange OKCoin. “ETH/BTC has almost doubled in the last month.”

Ether dominance up ahead of CME launch

Ether, the second-largest cryptocurrency by market capitalization, was up Friday, trading around $1,714 and climbing 3.3% in 24 hours as of 21:00 UTC (4:00 p.m. ET). It hit a brand-new price high Friday, at $1,761, according to CoinDesk 20 data. 

Read More: Ether Tops $1.7K, Setting New Record as CME Futures Launch Nears


The dominance of ether, a measure of the asset to the larger $1.1 trillion market cap of cryptocurrencies overall, is now at over 17%. That’s a more than 50% increase since the beginning of 2021, according to metrics calculated by charting software TradingView.

Dominance of ether so far in 2021.

Source: TradingView

Chad Steinglass, head of trading at CrossTower Capital, told CoinDesk that crypto traders have been scooping up ETH ahead of institutional-friendly CME launching ether futures Feb. 8. “I think that many traders are building positions ahead of the launch,” he said. 

“The availability of CME-listed ETH futures could be a significant positive catalyst,” said Steinglass. “The addition of CME futures will open the door to many potential investors who want to have exposure, but have yet to take any positions due to logistical hurdles.” 

“With decentralized exchange trading surging yet again, and yield farming showing no sign of easing, growing interest in leveraged farming products is driving demand for ETH ever so higher and shows the market is only going to grow further,” noted Denis Vinokourov, head of research at crypto brokerage Bequant.

Other markets

Digital assets on the CoinDesk 20 are all in the green Friday. Notable winners as of 21:00 UTC (4:00 p.m. ET):


Read More: DeFi Season? LINK, AAVE, ZRX and COMP Hit Record Price Highs



Commodities:

  • Oil was up 0.86%. Price per barrel of West Texas Intermediate crude: $56.94.

  • Gold was in the green 0.92% and at $1,810 as of press time.

  • Silver is gaining, up 1.8% and changing hands at $26.82.

Treasurys:

  • The 10-year U.S. Treasury bond yield climbed Friday to 1.170 and in the green 3.2%.

The CoinDesk 20: The Assets That Matter Most to the Market





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Market Wrap: Bitcoin Drops to $36.3K as DeFi Jumps to $32B on Ether FOMO

by Coindesk

Bitcoin has had an up-and-down day and ether has performed similarly. But decentralized finance hit a new milestone.

  • Bitcoin (BTC) trading around $37,616 as of 21:15 UTC (4:15 p.m. ET). Gaining 1.4% over the previous 24 hours.

  • Bitcoin’s 24-hour range: $36,207-$38,731 (CoinDesk 20)

  • BTC above the 10-hour and the 50-hour moving average on the hourly chart, a bullish signal for market technicians.

Bitcoin trading on Bitstamp since Feb 1.

Source: TradingView

Bitcoin’s price had dropped Thursday, dipping to as low as $36,207, according to CoinDesk 20 data. Now, at press time, it has come back up, to $37,616.  

“Still trading around the 50-day moving average, so all good,” said Chris Thomas, head of institutional sales for Swissquote Bank. “Moved a long way back up over the last week or so again, so there’s just a little lack of energy today. And no more Elon pumps!”


Read More: Elon Musk Is Back Tweeting About Dogecoin as Price Rises 50%

Elon Musk may not be tweeting about bitcoin – he seems to favor dogecoin (DOGE) at the moment – but Thomas is right about the technicals: On the TradingView chart, the 50-day BTC price moving average has been bullish since October.

Daily bitcoin spot price on Bitstamp since October.

Source: TradingView

“Is it more sellers than buyers? Honestly, if I said anything it would be a false narrative,” said Vishal Shah, founder of crypto derivatives venue Alpha5. “Nothing has happened to change the course of anything here, just taking a breather here it seems.”


Read More: Visa Signals Further Crypto Ambitions With API Pilot

It still seems there’s been some rotation out of bitcoin and into other cryptocurrencies, or “altcoins.” One metric to watch: The share of trading volume of cryptocurrencies other than bitcoin, particularly ether, is now larger than ever, according to CoinDesk 20 exchange volume data.

Coindesk 20 crypto volumes the past six months.
(Shuai Hao/CoinDesk Research)

Source: CoinGecko

“Ether and the alts have been pushed quite aggressively over the last week or two so it’s a bit of profit taking,” said Swissquote’s Thomas, “Just looking at it all, not really much of a pullback. I think it’s just a pause for a breath.”

Some bullish analysts are undeterred. “These markets are going to surprise a lot of people to the upside,” said Rupert Douglas, head of institutional sales for crypto custody provider Koine. “Bitcoin is strong and is going to hit $100,000 this year, but ether is where you want to park your capital.” 

“We’re going to look back in three months’ time and think ETH at $1,600 was cheap,” Douglas added.

Ether FOMO fuels DeFi but fees cause mixed feelings

Ether (ETH), the second-largest cryptocurrency by market capitalization, was up Thursday trading around $1,652 and climbing 1% in 24 hours as of 21:15 UTC (4:15 p.m. ET). 

Read More: Ethereum Transaction Fees Hit Record Highs as Ether, DeFi Coins Soar


The amount of crypto in USD values locked in decentralized finance (DeFi) has crossed $32 billion, at $32.8 billion as of press time. That’s a gain of over 197% in the past three months, according to data aggregator DeFi Pulse.

Total value locked, or TVL, in DeFi the past three months.

Source: DeFi Pulse

Constantin Kogan, partner at crypto investment firm Wave Financial, points to ether’s all-time high as one of reasons for DeFi’s massive appreciation. Ether hit $1,697 Wednesday, according to CoinDesk 20 data. However, Kogan is concerned about fees, which often plague the ether market when ether gets hot. 

“The all-time high is great. For the whales [large holders of the currency] the fees don’t matter,” Kogan told CoinDesk. “It’s simply not (good) for average people; expensive tech and just waiting for ETH 2.0 to launch. Hard for average people.”

Other markets

Digital assets on the CoinDesk 20 are mixed Thursday but mostly green. Notable winners as of 21:15 UTC (4:15 p.m. ET):

  • 0x (ZRX) + 39.2%

  • orchid (OXT) + 19.6%

  • xrp (XRP) + 13.7%

Notable losers:




Commodities:

  • Oil was up 0.78%. Price per barrel of West Texas Intermediate crude: $56.35.

  • Gold was in the red 2.1% and at $1,739 as of press time.

  • Silver is falling, down 1.8% and changing hands at $26.34.

Treasurys:

  • The 10-year U.S. Treasury bond yield fell Thursday to 1.139 and in the red 0.33%.

The CoinDesk 20: The Assets That Matter Most to the Market




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Bitcoin (BTC) $ 43,775.73 0.81%
Ethereum (ETH) $ 2,232.91 2.47%
Litecoin (LTC) $ 72.48 1.96%
Bitcoin Cash (BCH) $ 244.74 2.50%