Crypto Weekly: 20 – 26 February 2023
Polygon plans to release its new Layer 2 scaling solution, zkEVM, in a mainnet beta phase on 27 March. zkEVM will be a Zero-Knowledge Rollup that performs off-chain computations on a secondary layer for faster and cheaper transactions while maintaining security. zkEVM will be EVM-equivalent, allowing Ethereum developers to easily onboard DApps onto the Polygon network, and aims to expand Ethereum’s scaling capabilities even further.
Optimism has announced that it has rescheduled its Bedrock upgrade vote to Cycle 11 (2 March – 5 April) to give more Optimism community members time to participate in the vote as well as resolve bugs uncovered by the community as part of the Bedrock bug bounty contest. The Bedrock upgrade event marks Optimism’s first upgrade vote and will set the tone for future protocol upgrades and long-term improvement.
Singapore state-owned megabank DBS Group plans to expand its cryptocurrency services to Hong Kong as the Chinese administrative region continues its push to become a leading digital asset hub. Similarly, US-based automated global electronic broker Interactive Brokers has announced that it has launched its cryptocurrency trading service in Hong Kong, allowing select clients to trade Bitcoin and Ethereum.
According to crypto market research firm Messari, the blockchain gaming sector continues to struggle, with active users and new users in the space dropping by 30% and 34% since October. Despite the current dip, investment in blockchain gaming has remained robust as venture-capital firms demonstrate their faith in the sector’s long-term prospects by continuing to invest significantly.
eBay’s NFT platform KnownOrigin is launching its Creator Smart Contract feature for its artists/content creators, allowing artists to deploy their own smart contracts without requiring coding knowledge. By facilitating the creation of creator-owned contracts, artists can split earnings and earn royalties as co-creators with Smart Contracts that they own themselves without relying on a 3rd party contracts/shared marketplace contracts.
Binance CEO Changpeng Zhao has publicly refuted rumors that Binance is potentially considering delisting tokens from US-based projects. CZ’s statement is in response to a recent Bloomberg report that alleged that Binance is considering ending relationships with its US business partners as regulatory scrutiny from the US SEC, CFTC, Justice Department, and IRS increases, with the authorities forcing Paxos to cease the issuance of BUSD, Binance’s USD-pegged stablecoin.
Weekly Technical Analysis: 20 -26 February 2023
Bitcoin (BTC)
BTC failed to break through its $25,000 resistance level for the second time coming into this week. BTC is expected to trend sideways as it seeks to accumulate the momentum required for a breakout. If BTC can successfully break through resistance, the subsequent challenge will be at the $28,000 level. In the meantime, keep an eye on short-term support at the $23,500 level.
Ethereum (ETH)
ETH managed to hit its resistance at the $1,800 level before facing a correction. Keep an eye on ETH’s support at $1,500. If support can remain intact, ETH can potentially rally. If ETH breaks through its $1,800 resistance, the next critical target will be at the $2,000 level.
Velo (VELO)
VELO is up by +160.2% over the past week. This dramatic price surge means that the token is at risk of a similarly-strong correction. Keep an eye on whether support at 0.18 baht can remain intact this week. VELO will seek to test its resistance at the 0.34 baht mark.
Klaytn (KLAY)
KLAY is up by +75.8% over the past week. KLAY can potentially secure a long-term upwards reversal if it can successfully break through its critical resistance at the 14-baht level. Keep an eye on whether support at 10.50 baht can remain intact; if the support fails to hold, KLAY may revert to a downtrend.
Trading and Investment Considerations For The Week
The market remains volatile following the release of the US January CPI report, with inflation figures lower than December’s number of 6.4% but higher than market expectations of a 6.2% performance. Additionally, FOMC committee member James Bullard stated that he might potentially support a higher-than-expected 0.50% interest-rate hike at the next FED meeting in March to lock in recent deflationary trends. Following Bullard’s statement, the crypto and US stock market and gold prices fell.
Long-term investors could potentially overlook any interest-rate-related corrections and focus on inflation-beating assets such as Bitcoin, continuing to create buying pressure. However, it is critical to continue keeping an eye on crypto-related news from the SEC or other authorities, with increased regulatory pressure a potential negative factor that could force another black swan event.
This week US GDP estimates are set to be published on 23 February, with the market expecting figures to be in line with previous predictions of a 2.9% growth. Additionally, jobless claims numbers are expected to come out at 200,000, up from the previous report of 190,000 claims. On the same day, minutes from the previous FED meetings will be released. If the minutes reveal that the FED is leaning towards continuing its hawkish monetary policy and aggressive stance on raising interest rates, the market could be negatively affected.
Regardless, it is difficult to predict how exactly the market will respond to the release of the aforementioned economic figures/indicators and how much weight US economic growth or FED monetary policy will have on the crypto market. It is possible that the market may remain stagnant on the day these figures are released as investors seek to play it safe and avoid investing during a period of potentially high volatility.
Disclaimer:
-Cryptocurrency and Digital tokens are highly risky; investors may lose all investment money. Investors should study information carefully and make investments according to own risk profile.
– Past Returns/Past Performance does not guarantee future returns/performance.
*Materials on Bitazza Weekly Newsletter are intended to be used and must be used for informational purposes only. The views, information, or opinions expressed are solely those of the individuals involved and do not necessarily represent those of Bitazza and its employees. The information contained herein is not intended to be a source of advice or financial analysis with respect to the material presented, and the information and/or documents contained in this website do not constitute investment advice.
Sources:
https://u.today/optimism-op-jumps-11-with-new-upgrade-in-sight-heres-what-to-expect
https://cointelegraph.com/news/dbs-bank-to-offer-cryptocurrency-trading-in-hong-kong
https://cointelegraph.com/news/ebay-nft-platform-knownorigin-launches-creator-smart-contract
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