Crypto Weekly 31 July – 6 August 2023
US Securities and Exchange Commission (SEC) Chairman Gary Gensler has voiced concerns that there are not sufficient or adequate measures in place to protect investors against fraudulent activity in the crypto market. These lax measures may potentially lead to certain actors having disproportionate control over the market. Gensler’s warning comes as the SEC commences its consideration process for the approval of Bitcoin ETFs, a decision that it is expected to rule on from mid-August.
Japan’s Prime Minister has expressed his belief in the transformative potential of Web3 technology. He envisions a shift in the traditional internet infrastructure, leading to significant societal changes. In a bid to develop Web3 technology, Japan is spearheading initiatives to create economically valuable zones within the metaverse.
Paradigm, a technology investment firm, has highlighted that stablecoins pose less risk than bank deposits and differ from money market funds. Paradigm cited the instance of various regional banks collapsing, leading to losses for some depositors. In contrast, stablecoins feature mechanisms that are becoming increasingly standardized.
CryptoQuant reports that several indicators point towards large-scale investors, or “whale investors” holding between 1,000 to 10,000 BTC, have been accumulating Bitcoin at approximately the $30,000 price level. This level could potentially act as support in the event of a significant sell-off.
The Avalanche Foundation has announced the launch of Avalanche Vista, a fund focusing on diverse digital asset investments. The fund will cover various assets, including real estate, collectibles, debt securities, and intellectual property. It was established with an initial fund size of $50 million.
MakerDAO’s user community has approved a proposal seeking to temporarily increase the interest rate for Dai Stablecoin holders through the Enhanced Dai Savings Rate (EDSR). EDSR investors can expect a return of up to 8%, with a portfolio comprising 75% traditional investments and 25% digital assets.
For the first time in six months, Optimism network usage has surpassed that of Arbitrum in terms of transaction volume. From July 23rd to 26th, Optimism’s transactions increased by almost 65%. The last two days of this period coincide with the launch of Worldcoin on Optimism on July 25th.
Weekly Technical Analysis: 31 July – 6 August 2023
Bitcoin
BTC price movements remain confined within a narrow range and show no clear trend. The market seems to be awaiting news on the approval of the Bitcoin ETFs, which could begin in mid-August. Macroeconomic factors have had little to no impact on Bitcoin’s price movements. Short-term trading should be done within the price range of $28,000 and $32,500 support and resistance levels, respectively.
Ethereum (ETH)
ETH price has also been moving within a confined range, similar to Bitcoin. The increasing popularity of Layer 2 Blockchains may decrease transaction volumes on the Ethereum chain, impacting short-term traders. Trading should be done within the $1,700 and $1,900 support and resistance levels, respectively.
Optimism (OP)
OP gained 11.1% over the past week, buoyed by profit-taking trends in Worldcoin and increased transaction volumes on the chain. The trading strategy for Optimism would focus on buying on the dip at the support level that is not forming new lows. Short-term profit-taking could be expected at 53 Thai Baht, and short-term sell-off at 61 Thai Baht. However, if the price goes beyond this level, holding for the long term could be beneficial.
Uniswap (UNI)
UNI rose by 9.5% over the past week, following previous gains in DeFi group coins. However, the overall trend does not indicate a rising trajectory yet. Future price recovery should be watched closely. The first buying entry point can be at 210 Thai Baht (support level). If it holds, one can continue to hold and sell off for short-term profit at 232 Thai Baht.
Support: 210 Thai Baht Resistance: 232 Thai Baht
Trading and Investment Considerations For The Week
The outcome of the recent US Federal Reserve meeting indicates an upcoming 0.25% hike in interest rates, which aligns with market predictions. The FED Chairman reaffirmed the FED’s previous stance that no interest rate cuts are expected this year. Furthermore, the economic growth forecast for the US in Q1 has outpaced expectations, posting an increase of over 2%, versus the earlier anticipated 1.8% growth. However, these outcomes did not significantly affect the Bitcoin price, reaffirming the notion that the crypto market is now more driven by industry-specific factors rather than macroeconomic indicators.
This week, a key economic data point to watch out for is the Non-Farm Payroll. The market anticipates 200,000 new jobs, with the unemployment rate expected to remain steady as compared to the previous month. The figures released will likely influence the movements of the US dollar.
The market continues to keep an eye on the approval of Bitcoin ETFs by the US Securities and Exchange Commission (SEC). Recently, the SEC Chairman revealed that there would be no statements made on the subject until the commission formally reviews the matter. The process to consider the approval of Bitcoin ETFs has started, with the initial results potentially announced from mid-August onwards.
In the past week, tokens in the DeFi sector, such as Maker (MKR), Optimism (OP), and Uniswap (UNI), have stood out as relatively strong performers. Additionally, Dogecoin (DOGE), Baby Doge Coin (BabyDoge), and Shiba Inu (SHIB) have had profit-taking opportunities following hype and speculation surrounding Elon Musk. Overall, the strategy should still prioritize short-term profit-making. NFT and Metaverse-related tokens/projects have underperformed during this period.
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.
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