2020 has been a rollercoaster year for Bitcoin. The lockdowns caused by the coronavirus pandemic earlier in the year pushed the crypto lower by almost 60 percent. Its crash shortly followed an equally aggressive rebound that took its price up by 220 percent.

It is safe to say that Bitcoin is sitting in a profitable position so far into the year. The cryptocurrency’s year-to-date performance at 50 percent above zero stands taller than the one logged by traditional markets, including the US benchmark S&P 500 index.

But entering the fourth and final quarter of 2020, the Bitcoin market struggles with the prospect of paring a good portion of its yearly gains, if not all. Here are three reasons why the cryptocurrency risks trending lower in the session ahead.

#1 US Election Uncertainty

Bitcoin moved almost in tandem with the US equities at the end of the third quarter. So it appears, the cryptocurrency traders were waiting for further clarity on the outcome of the US presidential election in November. But even when polls showed that the Democratic contender Joe Biden might win the presidency, Donald Trump spoiled the outlook.

The incumbent US president said that he wouldn’t leave the oval office quietly over his suspicions of voter fraud. Investors took his statement to heart. They dumped stocks the entire September 2020 to seek safety in cash. Bitcoin, meanwhile, also dived by 9 percent in the month despite closing the third quarter in extremely positive territory.

Bitcoin-SPX correlation against the US election uncertainty. Source: TradingView.com

The month of October expects Bitcoin and Wall Street indexes to stay choppy, if not bearish. The cryptocurrency could therefore revisit previous support levels near $10,400, $10,200, and $10,000 as investors move into the safety of cash. Meanwhile, traders with a long-term outlook could cap the downside momentum by buying BTC at local lows.

#2 Delinquencies

Another factor that would test the Bitcoin and Wall Street bulls is the rise in bad loans in the US.

The lack of agreement over the second coronavirus stimulus package is a cause of concern for the unemployed and small and medium-sized businesses. With economists expecting no stimulus until the presidential election, the market is liable to see a rise in mortgages, loans, credit, and rental crimes in the fourth quarter.

That could leave finance stocks–the backbone of the US economy–lower. And sooner, its losses could ripple through the Bitcoin market, as traders start offloading their profitable positions to cover their losses on Wall Street. It is–again–because of the correlation between Bitcoin and the S&P 500.

#3 Coronavirus

The US markets will keep trading under the risks of the second wave of coronavirus infections. In the absence of a stimulus, followed by threats of another round of business lockdowns, investors may be forced to back into risk-off assets, including the US dollar and government bonds.

Earlier through February until March, a similar sentiment had caused the Bitcoin market to crash lower. Therefore, not unless there is fresh aid available for the US economy, the cryptocurrency may get trapped in the coronavirus-led sell-off sentiment.

The bottom line is that stimulus and liquidity can save Bitcoin from getting anywhere below $10,000. Traders should watch the development on Capitol Hill for further cues. Until then, the risk of major downside moves remain.

• Ethereum and Bitcoin have seen mixed performance over the past few days.
• There was an attempted breakout a few days ago, but that failed due to weakness in legacy markets.
• ETH is up 0.8% in the past 24 hours, slightly outperforming Bitcoin.
• Ethereum is primed to move higher in the coming week or two due to on-chain and technical support, one analyst says.
• This rally would be in line with the introduction of the ETH2 rehearsal testnet that will precede the launch of the official upgrade.
• Analysts say that the upgrade is important for the cryptocurrency because it will drive usage.
• Ethereum’s price action, though, is at the end of the day somewhat dependent on that of Bitcoin.
• Bitcoin’s price action determines the directionality of the rest of the crypto-asset market.

Ethereum Could Soon Move to $400, Analyst Says as Market Bid Comes In

Over the past few days, multiple analysts have noted that Ethereum is likely to fall in the very near term. They point to the asset’s rejection in the resistance range of $365-375 just a few days ago, which suggests a return to local lows.

Yet another trader agreed with this sentiment just recently, however, he caveated that with the expectation of a rally afterward.

He shared the chart below on September 30th, noting that after Ethereum corrects, it is likely to revert higher to $400. He added that there are some whales (large holders) supporting the cryptocurrency as per the heat maps of leading exchanges:

“Mid term vision. I usually don’t look farther than 1 trade ahead, but this makes sense to me. ETH seems to REFUSE to dump. Hacks etc., and simply no response. Also spotted some whales supporting on the heatmap this morning at 351~. 375 -> liquidity below 337 -> test 400.”

Chart of ETH's price action since the end of July with analysis by crypto trader Chase NL (@Chase_NL on Twitter). Chart from TradingView.com

ETH2 Launch Approaching

Supporting the Ethereum bull case is the upcoming launch of ETH 2.0 (a.k.a. Serenity or ETH2). The upgrade is expected to imbue the cryptocurrency with a staking premium, along with giving it the capacity to scale over time to combat scaling concerns currently seen with Ethereum 1.0.

ETH2 is nearing as developers roll out a “rehearsal” testnet Spadina.

Unfortunately, there were some issues with the testnet:

“Although the eth2 clients have generally become quite robust, the long wait for finality today highlighted issues closer to the edge of the stack — cli options, testnet config, bootnodes, genesis calculation bugs.”

These bugs may be addressed in the next rehearsal testnet, set to launch in a week or two.

Photo by Liana Mikah on Unsplash
Price tags: ethusd, ethbtc
Charts from TradingView.com
Ethereum is Primed to Shoot Towards $400 as On-Chain Support Is Strong

• Bitcoin’s price action hasn’t been providing investors with many insights, as it has primarily stagnated as it trades around $10,700
• The cryptocurrency market is currently resting on the edge of a blade as investors closely watch to see where BTC may trend in the near-term
• One trend that seems to point to underlying bullishness is a spike in activity seen amongst new market participants
• While speaking about this, one on-chain analyst said that this spike in activity coming amidst bearish price action has created a bullish divergence
• This could mean that upside is imminent for the cryptocurrency

Bitcoin has been consolidation between $10,200 and $11,200 for the past couple of weeks, but this trading range has narrowed as of late.

The cryptocurrency is now caught between $10,600 and $10,800, with bulls and bears reaching an impasse as its volatility and trading volume both show signs of dwindling.

Where the entire market trends next will likely depend largely on BTC, as altcoins have lost virtually all of their momentum throughout the course of this consolidation phase.

That being said, one trader is now pointing to an influx of new investors into the market, noting this is a bullish sign.

Bitcoin’s Volatility Dwindles as Consolidation Persists

At the time of writing, Bitcoin is trading down 1% at its current price of 1%. This is around where it has been trading throughout the past few days and marks a narrowing of a much wider range formed over the past two weeks.

This range exists between $10,200 and $11,200. Until one of these levels is broken above or below, the cryptocurrency still remains relatively trendless.

The entire crypto market’s outlook also hinges on BTC’s reaction to these levels, as virtually all altcoins have been seeing tempered price action as they observe the benchmark cryptocurrency.

On-Chain Analyst: Bullish Divergence Seen While Looking at New BTC Investors’ Activity

Willy Woo – a respected on-chain analyst – explained in a recent tweet that he is witnessing a bullish divergence between Bitcoin’s dwindling price and the uptick in activity amongst new crypto market participants.

He reckons that this is a bullish trend, indicating that upside is imminent for BTC.

“We’re seeing a spike in activity by new participants coming into BTC not yet reflected in price, it doesn’t happen often. This is what traders call a divergence, in this case it’s obviously bullish.”

Image Courtesy of Willy Woo. Chart via Glassnode.

Once this trend does get reflected in Bitcoin’s price, it could help guide it above the upper boundaries of the current ranges it is caught within.

Featured image from Unsplash.
Pricing data from TradingView.

Bitcoin is the entire reason that the term “HODL” was coined, no pun intended. The phrase “hold on for dear life” may have been taken too much too heart, with more than half of the total BTC supply locked away dormant in a wallet for a year or more.

Are these committed long-term holders, hoarders, or is something else going on? We’re looking at all the possible scenarios related to the ever-increasing sleeping supply of BTC and what each could indicate.

Supply Shock: Over Half Of BTC In Circulation Has Been Dormant A Year Or More

Percentage of BTC Supply Dormant 1-Year, 2-Years, and 3-Years | Source: glassnode

Bitcoin is a trader’s asset, experiencing wild and explosive volatility, rising and falling 80% or more in a year or less. But it is also a long-term investor’s dream, or at least it always has been.

Anyone holding Bitcoin for just about any point of its life, aside from a short-lived stint in 2019, and a month or two in 2017, would have substantial ROI to show for it.

It is the best-performing financial asset of all time, and even though it can be a rollercoaster ride along the way, the returns have proven worth the stress. To ease investors first experiencing Bitcoin’s explosive volatility, a phrase was coined “hold on for dear life,” or “HODL.”

RELATED READING | THIS UNUSUAL BITCOIN ADOPTION METRIC SETS NEW ATH

Rather than try to sell high and buy low, then watching Bitcoin bounce and leave new traders in the dust, old-timers advocated simply holding strong. And crypto investors are listening.

Or perhaps they’re simply preparing for some of the future projections the asset is predicted to reach, potentially as high as $400,000 per BTC or more. Whatever the motivation, more than 63% of the BTC supply has been dormant for over a year.

44% of the total supply has been held in wallets since September 2018 or earlier, meaning they held through the worst of the bear market and didn’t sell at the bottom, nor did they sell on Black Thursday or any time in between.

The third figure, at three years dormant, reaches a surprising 31%. This data suggests that more than a quarter of the BTC supply has been sitting since September 2017, missing the peak, the entire bear market, and more.

BTCUSD Weekly Price Chart Depicting Corresponding BTC Supply Movement | Source: TradingView

What’s The Reason Behind Hoarding Bitcoin The Entire Bear Market?

Not selling Bitcoin at $20,000 or at any time over the last three years suggests that the holders of these coins are extremely committed to the cryptocurrency long-term, or the coins are lost, locked away, or forgotten on the blockchain for good.

In the early days of cryptocurrencies, mining for BTC was the only way to obtain it. Many of these early miners may not have known what they had unlocked in potential, and lost their private keys, passed away, or more. Even Satoshi himself (or herself) as said to own 1 million BTC of the total 21 million and has since vanished without a trace and is presumed deceased.

RELATED READING | OWNING BITCOIN “IS A MUST” SAYS PRICE OF TOMORROW AUTHOR, JEFF BOOTH

Some could have been purchased and lost during the Silk Road days when users were buying BTC for drugs and paid no attention to how to keep the cryptocurrency long term.

Whatever the reasons may be, almost two full thirds of the supply haven’t moved in a year or more, while another nearly a third hasn’t moved in three years.

What’s also interesting, is the fact that Bitcoin also just set an all-time high on its 180-day moving average for address activity, which shows the other side of the coin. That data, suggests that the remaining 39% of BTC that is circulating freely, is doing so at the highest rate it has ever.

Featured image from Deposit Photos, Charts from TradingView and glassnode

Powered by

Every week, IntoTheBlock brings you on-chain analysis of top news stories in the crypto space. Leveraging blockchain’s public nature, IntoTheBlock’s machine learning algorithms extract key data that provide a deeper dive into the major developments in the industry.

 
This week, we cover Bitcoin’s on-chain indicators showing strength despite the price retracement. On the other hand, we dive into the crash experienced by Chainlink and some of the warning signals it had been showing.

Bitcoin Sustains Above $10K as Markets Decline

Bitcoin’s price has been relatively stable following a market-wide correction in early September. Despite dropping approximately 8% in September, Bitcoin has managed to achieve a record: it has closed above the $10,000 mark for its longest streak of 64 days and counting. 

With prices trending sideways for the past couple of days, traders are unsettled on whether this is the beginning of a larger correction or if prices are ready to climb back. By analyzing on-chain activity, we are able to obtain a clearer picture of Bitcoin’s current state and what may come next. 

Daily active addresses, for instance, provide a valuable metric for Bitcoin’s usage. While the number of addresses does not necessarily equate to the number of Bitcoin users, this indicator still provides a valuable approximation to Bitcoin’s daily activity. As we can see in the graph below, Bitcoin daily active addresses hit a two-year high a few days ago:

This is a clear indication that demand to use Bitcoin has been growing steadily, as reflected in the number of active addresses. Moreover, Bitcoin saw a similar pattern in early July when daily active addresses also reached a high while prices were trending sideways. This increase in demand preceded a 20% break-out. 

Another key Bitcoin indicator has been reaching new highs: its hash rate. In this case, the hash rate has hit several all-time highs in 2020. The hash rate — which measures the aggregate computing power contributed by Bitcoin miners — is a key indicator of Bitcoin’s security.

The growing hash rate is even more remarkable when considering the Bitcoin halving reduced the amount of Bitcoin rewarded to miners by 50%. Despite the reduced profitability, miners continue to contribute more resources to mining Bitcoin, potentially signalling their bullish stance on the decentralized cryptocurrency. 

While these indicators offer an optimistic outlook on Bitcoin, it still has several levels of large resistance before crypto traders go back to talking about lambos and moons. By analyzing all the prices at which Bitcoin was purchased on-chain, IntoTheBlock is able to assess holders’ profitability and identify key areas of support and resistance. This data is displayed in the In/Out of the Money series of indicators.

The In/Out of the Money Around Price shows price levels where Bitcoin addresses have previously bought, categorizing addresses as in the money (profiting) or out of the money (losing money). The size of these clusters represents the volume of Bitcoin held in current positions that was purchased in this price range. Here, we can see that over 1.1 million BTC was purchased by 1.48 million addresses between $10,400 and $10,700. This is expected to (and has been) an area of strong support as there will be buying pressure from holders to sustain this key range. 

On the other hand, there are two areas of strong resistance for Bitcoin based on on-chain data. The first one is the current resistance it is facing around the $11,000 mark, where 626K BTC has been bought by 1.17 million addresses. This creates resistance from many of these addresses looking to close their positions to break-even. After that, there is another similar resistance level between $11,400 and $11,700 as shown in the graph above. The good news is that past these resistance levels, there is likely to be less selling pressure past $12,000. 

Overall, Bitcoin has seen remarkable growth throughout 2020. Despite the recent price retracement, key indicators such as its daily active addresses and hash rate continue to signal bullish momentum. While these do not necessarily predict price will break-out right away, they do highlight the sustained optimism in Bitcoin’s outlook. In order to continue its positive price action, though, Bitcoin must first overcome the strong resistance levels below the $12,000 mark.

The Chainlink Aftermath

Several decentralized finance (DeFi) and oracles tokens have crashed by over 50% from their yearly highs in August. Chainlink, which had been one of the best performers this year, has been no exception, with LINK’s price dropping as much as 60% from its high around $20. 

While the crash coincided with a broader market retracement in crypto and equities, Chainlink and DeFi tokens had been flashing signals of traders being overly exuberant. For one, the number of short-term addresses had spiked dramatically following LINK’s price action in the summer.

Traders, which IntoTheBlock categorizes as addresses that have been holding tokens for under 30 days, increased by over 7x compared to the number seen in January. This pattern points to high speculative activity, and can also be seen in many other oracles and DeFi tokens. 

By analyzing transaction activity, we can see that large players appeared to be selling LINK near the highs. Large Transactions Volume, which aggregates the volume in transfers of over $100,000 on-chain, reached an all-time high a few days prior to LINK’s peak.

Large transactions also jumped over $300 million following the confirmation of a lower high in early September, pointing to the likely closing of whales’ positions. These values have since settled even as LINK continues in a downward trajectory. 

While LINK does have actual usage from its many partnerships, it is fair to say that speculative traders got ahead of themselves. As seen in the graph above, it appears that large players benefitted from the parabolic price action by selling towards the highs.

Overall, this does not negate Chainlink’s success as a bridge between off-chain and on-chain data, but it does point to the aftermath of a potential bubble. Ultimately, while the use-case for oracles remains bright long-term, its short-term price action remains risky and traders should proceed cautiously.

This article contains links to third-party websites or other content for information purposes only (“Third-Party Sites”). The Third-Party Sites are not under the control of CoinMarketCap, and CoinMarketCap is not responsible for the content of any Third-Party Site, including without limitation any link contained in a Third-Party Site, or any changes or updates to a Third-Party Site. CoinMarketCap is providing these links to you only as a convenience, and the inclusion of any link does not imply endorsement, approval or recommendation by CoinMarketCap of the site or any association with its operators.

This article is intended to be used and must be used for informational purposes only. It is important to do your own research and analysis before making any material decisions related to any of the products or services described. This article is not intended as, and shall not be construed as, financial advice. 

The views and opinions expressed in this article are the author’s own and do not necessarily reflect those of CoinMarketCap.

The post Bitcoin’s Records & Chainlink’s Aftermath: A Data Perspective by IntoTheBlock appeared first on CoinMarketCap Blog.

Bitcoin is once again approaching $11K, after swiftly recovering from a drop alongside stocks and gold early last week.

The leading cryptocurrency fell to $10K before bouncing amidst bullish headlines, including news that British overseas territory Bermuda had approved a Bitcoin ETF. Although not on U.S. soil, the event has created a stir among traders, who have long anticipated that a Bitcoin ETF listing could trigger a meteoric rise like the one that followed the first Gold ETF in 2003.

Ahead of Bitcoin, little brother Ethereum recovered even faster from the fall. The second-largest cryptocurrency has pushed up almost 3% over the last seven days as it races to catch up with the week’s biggest winners -- Cardano and Tezos.

This Week’s Highlights

• Cardano Climbs Above $0.10
• Tezos Rides Tokenized Art Trend

Cardano Climbs Above $0.10

A surprise ask-me-anything session with Cardano founder Charles Hoskinson catalyzed a 20% surge for the platform’s native token, ADA, last week. In the session, Hoskinson shared details of the upcoming network upgrade, Goguen. This represents a big step forward as it will allow developers to build decentralized applications (dApps) on Cardano.

Bullish Cardano sentiment has been bolstered further by news that IOHK, the company behind the platform, is working with the United Nations to incentivize the development of blockchain projects aimed at boosting sustainability.

Tezos Rides Tokenized Art Trend

The self-governing smart contract platform Tezos has risen almost 7% over the last week.

As one of the leading tokenization platforms, the rally could be related to rising interest in non-fungible tokens (NFTs). These on-chain crypto-collectibles and unique art pieces have garnered increased attention in recent weeks amidst the DeFi boom.

Aside from hosting digital artwork, Tezos could also be helping small Chinese businesses to build and deploy blockchain apps. China’s government-backed blockchain infrastructure initiative, the Blockchain Service Network, announced this week that it has now fully integrated Tezos.

The Week Ahead

Although September has been a relatively quiet month, some suggest this is a bullish sign, with data from Messari showing that Bitcoin has never before managed to stay above five figures for so long.

This buoyancy is particularly impressive given the recent KuCoin hack, which could continue to impact crypto markets in the coming week as hackers seek to offload more than $150M in stolen funds. 

As we move into October, the impending U.S. election is likely to dictate price action across global markets, along with fears of a second wave of coronavirus cases. This could come to a head-on Friday when the latest jobs report will give fresh insight into the state of the economy.

Disclaimer: The information presented here does not constitute investment advice or an offer to invest. The statements, views, and opinions expressed in this article are solely those of the author/company and do not represent those of Bitcoinist. We strongly advise our readers to DYOR before investing in any cryptocurrency, blockchain project, or ICO, particularly those that guarantee profits. Furthermore, Bitcoinist does not guarantee or imply that the cryptocurrencies or projects published are legal in any specific reader’s location. It is the reader’s responsibility to know the laws regarding cryptocurrencies and ICOs in his or her country.

• Bitcoin could soon see a bullish trend reversal as an on-chain indicator suggests it will do so.
• The on-chain indicator has predicted a number of notable price trends over the past few years.
• For one, during 2017’s bull market, the indicator formed a number of bounces off the 1.0 reading.
• Other fundamental trends also suggest that the prevailing Bitcoin trend is bullish.

Bitcoin Could See a Bullish Trend Reversal Very Shortly: Key On-Chain Analysis

Bitcoin may be primed to see a pivotal bullish bounce as a key on-chain indicator reaches a historical reversal point.

As shared by Glassnode CTO and co-founder Rafael Schultze-Kraft, BTC’s short-term holder MVRV ratio is reaching the historical reversal point of 1.0. The ratio tracks if short-term Bitcoin investors currently think the coin is over or undervalued.

Per Schultze-Kraft, the fact that the ratio is nearing a value of 1.0 suggests Bitcoin may soon bounce:

“#Bitcoin STH-MVRV Ratio has been above one since April. Currently testing the support line at 1 (indicative for trend reversals) – short term holders are valuing $BTC at its realized price.”

As can be seen in the chart below, multiple times during Bitcoin’s 2017 rally did the indicator bounce cleanly off the 1.0-1.1 reading, leading to a rally to $20,000 from around $500. The cryptocurrency was also rejected multiple times when the STH-MVRV Ratio hit one from the underside.

This historical accuracy suggests that Bitcoin may have room to move higher as the indicator nears a pivotal historical reversal level.

Chart of BTC's price action since 2010 with a STH-MVRV Ratio analysis by crypto analytics firm Glassnode. Chart shared  on Twitter by
Rafael Schultze-Kraft, CTO of Glassnode.

Other Fundamentals Favoring Bulls, Analysts Says

Raoul Pal, CEO of Real Vision and a former Goldman Sachs head of hedge fund sales, recently said:

“Most people don’t understand the latter but is simply put, Powell has shown that there is ZERO tolerance for deflation so they will do ANYTHING to stop it, and that is good for the two hardest assets – Gold and Bitcoin. Powell WANTS inflation. I don’t think he gets true demand push inflation but he will get fiat devaluation, in conjunction with the other central banks all on the same mission.”

Photo by Reinhart Julian on Unsplash
Price tags: xbtusd, btcusd, btcusdt
Chart from TradingView.com
Crucial On-Chain Trend Suggests Bitcoin Could See a Trend Reversal

• Ethereum could drop even lower than it has over the past few weeks as it faces strong resistance.
• Analysts say that the crypto asset is vulnerable to a drop under $300 in the coming weeks.
• The asset is running up against critical resistances around $360-375.
• The coin will need to surmount this region, then hold it if it is to confirm more upside.

Ethereum Could Soon Drop Under $300, Analysts Fear

Ethereum is primed to drop lower as the cryptocurrency faces strong resistances above its current price, analysts say. One trader shared the chart below on September 29th, noting that ETH is likely to move lower as opposed to higher from here.

His sentiment seems to suggest that the resistance Ethereum is currently facing above its price is far more notable than the supports below. So much so that the trader said that the coin could reach $275-300 in the near future.

“I’ve been trying to fight it but I think $275 to $300 $ETH is the path of least resistance. The weekly is just a struggle. I’m an aggressive buyer at the 200 week MA.”

Chart of ETH's price action over the past few months with analysis by crypto analyst Ledger Status (@Ledgerstatus on Twitter). Chart from TradingView.com

He’s not the only one that thinks that Ethereum will move lower.

Michael Van De Poppe, a crypto analyst and trader at the Amsterdam Stock Exchange, recently said that the asset’s inability to pass the crucial hurdle of $366-375 will be disastrous for bulls. As reported by Bitcoinist previously, he said:

“All right, this one is moving upwards and that’s good. However, the crucial hurdle is around $366-375 to break. If that breaks, $ETH is ready for $415. If not, I assume $280 as a likely possibility for further corrective movements in Q4.”

Chart of ETH's price action over the past few months with analysis by crypto analyst Michael Van De Poppe. Chart from TradingView.com

Fundamentals of ETH Strengthen

Despite this price action, the fundamentals of the Ethereum network are strong.

Commenting on the fundamentals of the entire crypto space with an Ethereum undertone, Spencer Noon, head of DTC Capital, said:

“The strong fundamental backdrop to #crypto — which is unlike any bull market previously — is that there are billions of cryptodollars coming on-chain to use #DeFi. Unless that shows signs of slowing, we are on track for a multi-trillion dollar aggregate marketcap for the space.”

Noon has explained that the cryptocurrency market has better fundamentals than ever before. Ethereum has much to gain from these fundamentals, especially as there is high yield-offering opportunities based on the network.

Featured Image from Shutterstock
Price tags: ethereum, ethusd, ethbtc
Charts from TradingView.com
A Drop Under $300 Is the Path of "Least Resistance" for Ethereum

Bitcoin and global stocks fell hours after the first presidential debate between Donald Trump and Joe Biden concluded on a chaotic note.

The benchmark cryptocurrency erased a significant portion of its Tuesday gains to turn 1.19 percent lower. At the same time, futures tied to America’s S&P 500 index plunged 0.85 percent, hinting to open in negative territory at the New York opening bell Wednesday.

Asia-Pacific markets, including Australia’s ASX 200, Japan’s Nikkei, and China’s Shanghai Composite, also dropped. In Europe, futures linked to London’s FTSE were down 0.5 percent.

Bitcoin erases intraday gains after a chaotic presidential debate round. Source: TradingView.com

VIX

The sell-off across the risk-on markets happened as investors reiterated their concerns over an uncertain US presidential election. Their negative sentiment took cues from Trump’s assertions of widespread voter fraud and his vows to actively challenge the outcome.

VIX futures are rising as investors fear an uncertain US election outcome. Source: FT

Fears of a disputed election pushed VIX futures–a barometer to gauge market uncertainty using volatility–higher. Economists, strategists, and analysts predicted a further uptick in VIX ahead of the US election that may lead to a short-term stock market sell-off.

“[Trump’s] suggestion that he would actively contest the results for weeks after the ballots are counted increases the level of uncertainty for market participants and will likely lead to higher volatility as we approach election day,” said Mark Haefele, the chief investment officer for global wealth management at UBS.

Impact on Bitcoin

While the Bitcoin market does not concern itself with geopolitical setups, the cryptocurrency’s erratic correlation with global market sentiments since their synchronous crash in March 2020 suggests an influence.

The realized monthly correlation between BTC and SPX has been rising since March 2020. Source: Skew

So it appears, traders/investors with exposure in both Bitcoin and the stock markets tend to sell the cryptocurrency to offset their losses across equities. Overleveraged traders also use their Bitcoin profits to fill their margin positions. That further creates an additional downside pressure on the cryptocurrency.

One of the other reasons why traders sell Bitcoin concerns liquidity. In March 2020, the cryptocurrency crashed alongside the global stocks because investors sought to hedge in cash. As a result, the US dollar index surged 8.80 percent during the rout.

The Federal Reserve’s expansionary policy and the US Congress’s $2 trillion COVID-19 stimulus package prompted investors to move back to stock, gold, and Bitcoin markets. The US dollar fell during aid distribution.

And now, with the package running out, and the second stimulus bill delayed, the US dollar is rising again.

Bitcoin, on the other hand, is trading almost 13 percent lower from its year-to-date high near $12,500.

The cryptocurrency now trends in unchartered territory. It expects volatile sessions ahead as long as it maintains a correlation with the S&P 500.

CoinMarketCap Earn, a way for CoinMarketCap users to learn about how a certain crypto asset while earning crypto rewards, has chosen Terra (LUNA) for their next educational campaign.

CoinMarketCap users interested in learning more about Terra, and earning rewards in LUNA, can watch a short series of videos about Terra, take a quiz, and earn up to $10 in LUNA if they get all the answers correct.

In total, there is $180,000 USD worth of LUNA as rewards for successful quiz takers — this means that if there are 180,000 winners, each person gets $1 in LUNA, if there are 80,000 winners, each person gets $2, and so on.

Reminder: Just because $10 is the maximum amount of earnings, it does not mean that successful quiz takers get $10 — Earn rewards are calculated by the total number of successful participants divided by the $180,000 USD worth of LUNA.

This CoinMarketCap Earn campaign will take place for ten days, from Sept. 30 to Oct. 10. After the campaign is over, you can still watch educational videos about Terra, but you will no longer be eligible for rewards!

For quiz winners, LUNA will be distributed from Oct. 12 to Oct. 19. The exchange rate will be unilaterally defined by CoinMarketCap post-campaign.

What’s New?

In order to improve the token distribution process, we have decided to move the settlement process off-chain by partnering with Binance. We are in conversation with other exchanges as well for future campaigns. For this campaign, only Binance exchange addresses will be able to receive LUNA rewards.

On-chain settlement for such a large rewards pool has inherent blockchain security risks, and for ERC20 tokens, high gas fees on the Ethereum network make distributions economically unfeasible as well. For this reason, internal distribution by Binance allows the rewards to be settled off-chain at reasonable cost and without any major delays.

This Earn campaign will also last for ten days, while earlier campaigns lasted for eight!

I’m Ready to Learn and Earn!

Creating an account on CoinMarketCap is the necessary first step for participation in all CoinMarketCap Earn campaigns: you can sign up here.

Once you are signed in, check out CoinMarketCap Earn’s live campaigns page and select Terra to watch a series of educational videos. When the videos are done, review your notes! You can only take the quiz at the end once — so pay attention if you want a reward.

If you successfully answer all of the questions about Terra, you will be rewarded with up to $10 in LUNA at the end of the campaign period (remember: $180,000 USD divided by the number of successful quiz takers is the amount you receive!).

What Is Terra?

Terra is a network powered by a family of stablecoins — each pegged to the world’s major fiat currencies — that are all stabilized by Terra’s native token, LUNA. LUNA acts as both collateral for the entire Terra economy and as a staking token to secure Terra’s delegated proof-of-stake network. The protocol’s mission is to build an open financial structure that anybody can use, anywhere in the world.

What Is Earn?

CoinMarketCap Earn enables crypto enthusiasts to learn more about a particular cryptocurrency. Each user watches a series of educational videos about an asset, completes a quiz and is rewarded for their correct answers with crypto. With CoinMarketCap Earn, CMC can increase the breadth of knowledge about the crypto industry as part of its goal of showcasing the cryptocurrency revolution each step of the way.

A CoinMarketCap account is required for users to participate in the educational CoinMarketCAp Earn campaigns. Please remember that not all jurisdictions are supported at this time, so confirm that your jurisdiction is supported by checking out our FAQ section.

To check out “CoinMarketCap Earn” please visit: https://coinmarketcap.com/earn/

The post CMC Launches CoinMarketCap Earn Campaign With Terra Money appeared first on CoinMarketCap Blog.

Bitcoin may undergo a significant price correction before the US presidential election due to its proximity to gold, hints Clem Chambers.

The CEO of ADVFN – Europe’s leading stocks and shares website, told Kitco News that most assets that have shown a positive correlation during the 2020 bull run tend to fall in tandem. He spoke about gold and how a “flash crash” in its markets could leave other assets in a similar bearish spell.

“I got a warning from the market about ten days ago…so I cleared the decks because I think it’s highly likely, not absolutely certain, but too likely to be in the markets that we’re going to be in for a crash,” Mr. Chambers said. “Normally before a crash, I experience what I call a market malfunction where my portfolio just doesn’t behave as it should.”

The Tale of Two Safe-Haven Assets

Bitcoin laggingly tailed gold, especially since the March 2020 global market rout wherein both the assets crashed in tandem. At one point this year, the short-term correlation between the cryptocurrency and the precious metal reached an all-time high of 75 percent.

The proximity grew mainly because of a growing demand for safe-haven and riskier assets amid a bearish US dollar outlook. The Federal Reserve’s unprecedented monetary policy, which includes an open-ended bond-buying program and near-zero interest rates, lifted the appeal of cash and cash-based instruments, such as US government bonds.

Anticipating short-term low yields, investors decided to offload their dollar positions for gold, Bitcoin, US stocks, and other assets.

Bitcoin is down 13% from its year-to-date high near $12,500. Source: TradingView.com

Nevertheless, the Fed warned last week that it could not continue its expansionary program without further monetary help from the US Congress. Its chair Jerome Powell requested the House to release the second coronavirus stimulus package. It is the aid that remains in a deadlock as the Democrats and the Republicans debate over its size.

Economists believe that the Congress will not be able to pass the stimulus bill before the November’s presidential election. With expectations of lesser dollar liquidity in the market, the demand for the greenback has increased among investors. On the other hand, gold, stocks, and Bitcoin have started correcting lower from their local highs.

That is where Mr. Chambers sees a “malfunction.”

Conflicting Bitcoin Opinions

But not all think on the line of Mr. Chambers, at least when it comes to the US dollar and its market bias.

Stephen Roach, the former chairman of Morgan Stanley Asia, said in an op-ed that the greenback could crash by at least 35 percent by the end of 2021, citing upticks across foreign currencies and looming macroeconomic issues in the US concerning lower savings and–again–the Fed’s expansionary policies.

“In short, the vice is tightening on a still-overvalued dollar,” Mr. Roach wrote.

The bearish dollar analogy points to more demand for Bitcoin and gold in the coming sessions. Some expect the cryptocurrency would hit $20,000 should the greenback keep falling.

Guest:  Javert ,Core dev and Jonathan, Product lead of Dego.finance 

Host: Molly

Introduction:

Molly: Before we start into the project, can you both give a background on yourselves, and other members of your team and how did you enter into crypto?

Javert: Sure, we the core team members have decided to take the Vow of Silence regarding our identities.

After all, we all have a life and prefer to stay anonymous.

But we are a solid team of 20+ people, most are full time and crypto veterans, scattered around the globe.

Molly: Could you please give a quick introduction to Dego Finance?

Javert: We aspire to build dego.finance as a DeFi Fusion Reactor whose transparency and fairness is governed by Law of Codes, for the unprivileged and unbanked underdogs .

And we just launched our new NFT mining pool at 21:00, do check it out:

Molly: Can you tell us a bit about DEGO token?

Jonathan: DEGO is the utility token that runs through all modules in DEGO ecosystem. You can use it to earn yield, to forge NFTs for mining and etc.

Questions from community:

Molly: Q1.People are saying that#NFT will bring the future mass adoption. What are your views about it? Where do you see the future evolution of NFT features and capabilities in the next few years? What’s #Dego’s vision?

Javert:

I’d add few points to the DEGO token, total supply is 21M like BTC to honor Satoshi, and we have the best inflation model I believe out of DeFi and NFT space.

Jonathan:

NFT in my eyes is a Decentralized Asset composed of art and the ownership. Previous NFTs is often found applied in arts, neglecting intrinsic value of the NFT itself, I think that NFT should be like a membership card, like gaming gears, which are easier for ordinary people to accept. If people developed a habit of using NFT, that NFT could trigger mass adoption.

Javert: This is how we pay tributes to Satoshi:

Molly: Q2.Dego NFT kryptonite sold for 30eth..so is NFT a revolution against DeFi?

Javert:

I really envy those of you who received the Kryptonite picks, which our core members don’t. It’s insane, but I think it makes more sense than the Art NFTs.

We will start the NFT auction soon and I don’t know how much Satoshi NFT will be sold for.

But you should know that the NFT can be worth much more than its face value because it is so rare and has utility.

The utility we give our NFTs is mining.So nice combination of Gaming gear and DeFi

Jonathan:

Javert:Again, we do not encourage speculation on DEGO NFTs as these NFTs are meant for one thing only, MINING.

Molly: Q3.Due to the rise in Ethereum’s Transaction Fees, has the team thought about switching to another blockchain?(Which cross-chain solutions #Dego Finance will use? Why DEGO choose to build on Ethereum?)

Jonathan:From the very beginning, we had the intention to develop our own public chain, and it was always the Blockchain before the Dapps, but we wanted to have the Dapps before the public chain, otherwise we are just amusing ourselves.

Javert:

Yeah ETH is so out of date now.Can you believe that a few popular dapp could jam it?Engineers like us are just reluctant to move to other chains, as people tend to stay in the comfort zone.

We are only launched for 2 weeks and become dapp consumed 3rd most amount of GAS? This is very unhealthy, and we do believe there will be soon much much better infrastructures for us to move to.

Molly: Q4.It’s heard that the next phase of adoption of blockchain technology will come from Gaming, DeFi and NFT. What is your views on this and what will be your prime focus for mass adoption #DegoFinance.

Jonathan: GAME+DEFI, I don’t think most people have figured out how to incorporate gaming elements into DeFi. What are games? In simple terms, if one NFT lost its value for speculation, playability should remain. Minesweeper is embedded in DEGO and we have not announced the REWARD hidden in it, while people spends time on it, this is playability. So we are blending more NFT playability in DeFi, like Synthetic NFTs, Team battles, no just simple mining. If you want yield, you must do more thinking. The intensified Game Theory in an DEGO is creating sth bigger than mining.

Javert:Yes I agree with Jon.

Javert:I believe our hard labour has paid off.DEGO NFTs has topped the charts for the last few days.

Molly: Q5.What is the current planning for dego project and What are your competitors or substitutes, in which way Dego is better?

Jonathan:I don’t think I need to answer that, what do you think?

Javert:

haha Jon, that’s too bold of a statement.even from you.But I encourage all of you to have a go at it. Always good to try new things.

Free-asking Session

Q1.dego interface is kinda Unique, like old Computer screen,

How can Dego team comes up with this briliant idea?@Agz18

Javert:

We have a taste for vintage things, aged tech has certain ring to it. I’m glad you enjoyed too.

Q2.Hey Can you please brief about FEATURES & BENEFITS to our community?@Anunar

Javert:

DEGO Ambassador Program will be launched soon to help build the global communities, stay tuned!

Follow us:

Telegram: https://t.me/MXCEnglish

MXC trading: https://t.me/MXCtrade

Twitter:  https://twitter.com/MXC_Exchange

                 https://twitter.com/MXC_Fans

Reddit:   https://ift.tt/2CJr1l7

Facebook: https://ift.tt/2CJr1S9

Discord:  https://discord.gg/zu5drS8

The post MXC Exchange Catches NFT Trending Again after DeFi appeared first on NullTX.

• Bitcoin’s price has entered a consolidation phase as it trades between $10,600 and $10,800
• The cryptocurrency’s strong uptrend in recent days stalled as soon as it approached $11,000, as the selling pressure at this level has proven to be quite significant
• Analysts are now conflicted on where it may trend next, as it all depends on whether $11,000 proves to be a surmountable level
• One analytics firm is now noting that there is one indicator that is providing insight into why BTC can’t seem to break this level
• They note that the network is currently seeing a “severe lack” of address activity, which points to underlying weakness

Bitcoin has been consolidating ever since bulls were able to push it up towards highs of $11,000. The move to this level earlier this week was promising, but it has since been followed by another prolonged period of sideways trading.

Where the entire market trends in the coming few weeks should depend largely on how it continues responding to the selling pressure that exists here.

If bears take control and push BTC lower, it may not find any strong support until $10,000, with a break below here being grave.

One fundamental metric that may be contributing to this slight weakness is a “severe lack of address activity” – according to one analytics firm.

Bitcoin Consolidates Below $11,000, But Weakness Grows 

At the time of writing, Bitcoin is trading up marginally at its current price of $10,770. This is around the price at which it has been trading at throughout the past several days.

Yesterday, after advancing towards $11,000, BTC faced a sudden inflow of selling pressure that caused its price to slide as low as $10,500 on some trading platforms.

The decline to these lows was fleeting, but it highlighted the strength of BTC’s near-term resistance, as well as some underlying weakness amongst bulls.

Analytics Firm: Network Activity Flashing Warning Signs for BTC

Analytics platform Santiment explained in a recent tweet that there is currently a severe lack of address activity on the Bitcoin network. This points to underlying weakness amongst the crypto’s buyers.

“Why is BTC continuing to see drop-offs occur whenever we near $11k? Our DAA Divergence model indicates the network is seeing a severe lack of address activity. Today is the 5th most bearish output in the past 6 mths.”

Image Courtesy of Santiment.

The coming few days should shine a light on Bitcoin’s mid-term outlook.

Featured image from Unsplash.
Pricing data from TradingView.