Bitazza Crypto Weekly: Leading Investors Continue to Champion Bitcoin -

Crypto Weekly: 9 – 15 May 2022

Despite plunging prices following the FED’s increasingly stringent monetary policy, prominent investors around the world continue to hold out hope for Bitcoin as a hedge against inflation.

In a recent interview with the Economic Times, billionaire investor and founder of Bridgewater Associates, Ray Dalio, acknowledged the potential of digital assets, especially Bitcoin, emphasizing their impressive performance over the past decade. Dalio notes that while gold currently outperforms Bitcoin as a hedge against inflation, he believes that investors must diversify their investment portfolio and that every investor should hold digital assets, gold, and other traditional assets to strengthen their overall holdings against inflation.

Similarly, renowned hedge fund manager Paul Tudor Jones remains bullish towards the long-term prospects of crypto. Asides from the growing adoption of crypto by the younger generation, Jones expects crypto to have a bright future as the FED raises interest rates against inflation.

The Luna Foundation Guard (LFG) has acquired 37,863 bitcoins, roughly $1.5 billion worth of BTC, on its way toward the $10 billion stablecoin reserve target before the end of the third quarter. This purchase brings LFG’s holdings to more than 80,000 BTC, making them one of the largest BTC holders in the world.

According to an updated filing with the US SEC, Binance has committed $500 million to Elon Musk’s $44 billion bid to acquire Twitter. Additionally, the filing indicates that other notable investors have committed funds to Musk’s acquisition plans, including Larry Ellison ($1 billion), Sequoia Capital ($800 million), Andreessen Horowitz ($400 million), Qatar Holding ($375 million), Fidelity ($316 million), and DFJ ($100 million).

Italian luxury fashion house Gucci is set to start accepting payment in cryptocurrencies in select stores in the United States. Retail customers will be able to pay for goods using more than 10 cryptocurrencies, including Bitcoin (BTC), Ethereum (ETH), Dogecoin (DOGE), and Shiba Inu (SHIB). The service will be rolled out later this month at five of its flagship US outlets, including Rodeo Drive in Los Angeles and New York’s Wooster Street, before potentially expanding the policy globally.

Dubai’s Virtual Assets Regulatory Authority (VARA) has recently opened it’s metaverse-based headquarters on The Sandbox. This move makes VARA the world’s first regulatory body to officially mark its presence on the Metaverse and purportedly signals Dubai’s intention to appear tech-forward and innovation-friendly. According to Sheikh Hamdan bin Mohammed bin Rashid Al Maktoum, VARA also represents a serious effort to build a new, robust economic sector that will contribute to Dubai’s economy and will create new investment opportunities.

NFT marketplace OpenSea has set a new daily trading record on 1 May 2022 thanks to record-breaking land sales of BAYC-associated NFT-centric MMOG Otherside. According to data from Dune Analytics, an Ethereum blockchain data analytics platform, OpenSea successfully registered $476 million in trading, surpassing the previous daily trading record of $323 million recorded on 29 August 2021.

Similarly, a Chainalysis report on the state of Web3 claims that the NFT market began its recovery in mid-April, with weekly volumes approaching highs hit earlier this year. According to the report, the number of active NFT buyers and sellers has increased every quarter since Q2 2020, with 491,000 addresses transacting with NFTs in Q2 2022, putting the NFT market on pace to continue its quarterly growth trend in terms of users.

Finally, ENS experienced a new record high number of domain registrations in April, with demand for 3- and 4-digit ENS domains surging this past month, triggering an ENS rally. The sudden surge in registrations at the end of April capped off a record month for the project, which saw 162,978 new domain registrations, according to data from Dune Analytics.

Weekly Technical Analysis: 9 – 15 May 2022

Bitcoin (BTC)

BTC’s correction continues pushing the market leader all the way to its support level at $33,000. If the prices fall through the support level, keep an eye on if it goes past the $28,000 since the current sideways trend will quickly flip into a downtrend if that were to occur. Resistance is set at $44,000 this week. BTC prices remain volatile and traders are advised to refrain from entering a BTC position this week until the market trend is confirmed.

Ethereum (ETH)

ETH faced a similar correction pushing it towards its support at $2,100. If this support cannot remain intact, look for ETH to enter a downtrend. Resistance is set at $3,000; however, overall ETH price remains highly volatile. With buying pressure quite weak at the moment, it will be better to wait for the market trend to become more clear before investing any further.

Algorand (ALGO)

ALGO is up by +22.1% from last week thanks to news of its partnership with FIFA. Its short-term trend has seen an upwards reversal, and if it passes the 30 baht level, could signal a sustained uptrend. However, if prices fall below the 20 baht support level, this may cause the trend to become bearish instead.

Curve DAO (CRV)

CRV is up +13.7% within the past week. However, the short-term trend still remains sideways, with a key support at the 68 baht level. If this support level cannot remain intact, look for CRV to enter a downtrend. The resistance is set at 96 baht. If CRV can successfully challenge its resistance, the DeFi token may be able to turn its short-term trend into an uptrend.

Trading and Investment Considerations For The Week

The US central bank has announced its biggest interest rate increase in more than two decades as it doubles down on its fight against inflation. The FED has announced it is lifting its benchmark interest rate by half a percentage point, to a range of 0.75% to 1%, after already increasing interest rates earlier this year in March. Concerns related to the interest rate hikes have dampened investor sentiment throughout the market and triggered massive sell-offs in both the stock and crypto markets.

This week investors are advised to keep an eye on the release of Consumer Price Index (CPI) figures on 11 May 2022. How the CPI is trending will help gauge the FED’s monetary policy decisions moving forward. If CPI figures are not significantly higher than March’s 8.5% inflation, it is possible that the 0.75% interest rate hike will not occur. If so, market sentiment will likely assume that interest rates will stick around the 0.5% level for the time being, hopefully leading to a market recovery.

On the other hand, if inflation is significantly higher than the previous 8.5% mark, the market correction will probably continue as buyers and sellers make moves assuming an upcoming 0.75% interest rate hike. However, with crude oil prices dropping in April from their earlier peak in March, it is possible that the rate of inflation may not have increased significantly in that timespan.

Until the CPI figures are released, and we have a clear idea of how the ongoing fight against inflation is going, Bitcoin prices remain subject to high volatility. Investors are advised to slow down and wait for more data regarding inflation figures before entering or closing a position. At this juncture, there is nothing to suggest a market-wide recovery any time soon. Traders looking to secure a profit with these current conditions are advised to focus solely on short-term moves.

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