Crypto Weekly 21 – 27 August 2023
Coinbase has received approval to offer futures contracts for cryptocurrencies in the United States. This approval comes after nearly two years of seeking authorization from the US National Futures Association (NFA). However, traders will need to meet certain criteria to open an account.
According to Bloomberg, the US Securities and Exchange Commission (SEC) is set to approve Ethereum Futures Exchange-Traded Funds (ETFs) following the launch of Bitcoin-Futures ETFs in 2021. Still, the introduction of spot-based ETFs investing directly in Ethereum remains uncertain.
The Jacobi Bitcoin ETF has started trading on the Euronext Amsterdam stock exchange. It’s noteworthy as it is the first ETF in Europe referencing the spot price of Bitcoin. This comes two years after the initial application for approval.
DappRadar reports a staggering 98% drop in the trading volume of Bitcoin Ordinals nonfungible tokens (NFTs) since May. From a peak of $452 million in May, it plummeted to roughly $3 million by August 14th, representing a transaction decline of over 97%.
The Wall Street Journal reveals that Elon Musk’s SpaceX liquidated Bitcoin holdings acquired in 2021, valued at $373 million. This sale might have contributed to Bitcoin’s price dipping to $25,200. Other altcoins also witnessed selling pressure in the wake.
The price volatility of Bitcoin in August stands at 15.5%, marking a historical low. This is a stark contrast from its peak volatility of 61.4% and early 2023’s figure of 43.8%. This aligns with the decreased trading volume observed.
The Monetary Authority of Singapore has released its latest guidelines on stablecoin oversight. The focus is primarily on stablecoins pegged to the Singapore dollar or G10 currencies such as the Euro, British Pound, and US Dollar.
Soon after introducing its own stablecoin, PayPal has launched the Cryptocurrencies Hub. This feature enhances user experience for Bitcoin and other digital currency transactions within their PayPal accounts. It also facilitates digital currency payments via PayPal.
Shiba Inu has rolled out the Shibarium mainnet under Ethereum Layer 2 after extensive testing. This platform has attracted millions of users and has facilitated the creation of over 21 million wallets. Shibarium operates on a new consensus mechanism named “proof-of-participation (PoP)”, selecting validators based on the proportion of associated digital currency holdings.
Weekly Technical Analysis: 21 – 27 August 2023
Bitcoin (BTC)
BTC experienced significant selling pressure, causing its price to touch a critical support level at $25,200. If it breaks below this level, investor sentiment might turn bearish, as the upward momentum could be lost. Conversely, if the price fails to breach its first resistance at $28,000, it could indicate weakened buying strength.
Ethereum (ETH)
ETH faced substantial sell-offs, pushing it below its key support level. However, buying interest has emerged due to the recent approval of ETH Futures ETFs. Despite this, the short-term trend remains bearish, and there’s potential to retest its previous low at $1,550.
ThorChain (RUNE)
RUNE appreciated by 24.7% over the past week, suggesting a continuous recovery trend. Its price resilience compared to the broader market is commendable. However, potential pullback strategies should be considered, with a support level identified at 52 THB and resistance at 66 THB.
Tron (TRX)
TRX underwent a marginal decline of 1.1% in the past week, which is relatively modest compared to the overall market. However, caution is advised if price looks like it may slip below its previous low at 2.54 THB. If TRX manages to surpass its initial resistance at 2.74 THB, this could instill confidence in a bullish recovery.
Trading and Investment Considerations For The Week
Recent comments from the Federal Reserve’s monetary policy committee indicate a continued focus on implementing tighter monetary policies. This stance could contribute to strengthening the US dollar, potentially exerting pressure on other assets. However, Bitcoin seems largely unaffected by these policy shifts.
The cryptocurrency market was taken aback by the news of SpaceX offloading its Bitcoin holdings, which the company acquired back in 2021. Although the volume of the sale wasn’t particularly significant, it incited anxiety among investors. This unease was amplified by the delay in approval for Bitcoin ETFs, leading to panic selling. Such market dynamics resulted in the second-highest liquidation rates in futures trading history, surpassed only by incidents like the FTX shutdown and issues surrounding Terra Luna.
Despite not witnessing a full bullish trend for Bitcoin, the significant number of traders opening long positions on the cryptocurrency suggests a continuing confidence in its potential upward adjustment for the remainder of the year. Even after substantial sell-offs, buying forces persistently support the price, indicating long-term investors are consistently accumulating. Short-term traders, however, are advised to effectively manage their portfolios during these volatile periods.
Key events to watch this week include the annual Federal Reserve meeting in Jackson Hole from August 24th to 26th. Particularly, the market will be eyeing the statement from the Fed Chair scheduled for Friday, August 25th, for insights on the future direction of US monetary policies.
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://cointelegraph.com/news/us-sec-deems-spot-bitcoin-etfs-filings-as-inadequate-report
https://cointelegraph.com/news/fidelity-renews-push-for-spot-wise-origin-btc-trust-making-it-7th-applicant-this-year
https://www.theblock.co/post/236904/microstrategy-bitcoin-12333-btc-for-347-million
https://cointelegraph.com/news/blackrock-bitcoin-etf-grayscale-sec
https://cointelegraph.com/news/bitcoin-crypto-investments-largest-weekly-inflow-since-july-2022
https://cointelegraph.com/news/ethereum-layer-2-optimism-transactions-surged-following-bedrock-upgrade-nansen
https://cointelegraph.com/news/hong-kong-establishes-task-force-web3-development
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