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Bitcoin Bull Run More Than Hype This Time – Don’t Be Surprised By US$20,000 Price By Years End

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Bitcoin to $20,000 in 2019? Bitcoin, the world’s largest cryptocurrency, surged in value to hit US$13,000 in late June.
Bitcoin, the world’s largest cryptocurrency, surged in value to hit US$13,000 in late June.
  • Stronger fundamentals, growing institutional interest and mainstream adoption of cryptocurrencies bode well for the prospects of bitcoin
  • The asset can also work as a hedge against macroeconomic risks

Table of Contents

Bitcoin Gearing Up For Bull Run?

At the time of writing, bitcoin is hovering above the US$10,000 mark. The last time we saw bitcoin reach this price was in December 2017, after which, the cryptocurrency went on to reach its all-time high of nearly US$20,000 in a matter of days.

The cryptocurrency market remained bearish for all of 2018, but with the way bitcoin is charging upwards and setting new highs in 2019, it is safe to say that the crypto-winter is behind us already. In the past several years, we have witnessed a cyclical pattern emerging in the cryptocurrency space.

And with each cycle, we reached exponentially greater heights.This time around, analysts have come up with bolder price predictions, ranging from US$21,000 all the way up to US$100,000, all of which begs the question: is the current bull market any different from the last one?

See: Expert Predictions: Price Forecasts of Bitcoin and Ethereum

Bitcoin, the world’s largest cryptocurrency, surged in value to hit US$13,000 in late June. Illustration: Reuters

Bitcoin, the world’s largest cryptocurrency, surged in value to hit US$13,000 in late June. Illustration: ReutersAt the time of writing, bitcoin has just surpassed the US$13,000 mark. The last time we saw bitcoin reach this price was in December 2017, after which, the cryptocurrency went on to reach its all-time high of nearly US$20,000 in a matter of days.

2018: Year of the Bears

The cryptocurrency market remained bearish for all of 2018, but with the way bitcoin is charging upwards and setting new highs in 2019, it is safe to say that the crypto-winter is behind us already. In the past several years, we have witnessed a cyclical pattern emerging in the cryptocurrency space. And with each cycle, we reached exponentially greater heights.This time around, analysts have come up with bolder price predictions, ranging from US$21,000 all the way up to US$100,000, all of which begs the question: is the current bull market any different from the last one?

inRead invented by TeadsDuring the peak of the 2017 cryptocurrency bull run, several sceptics compared it to the Tulip mania of the 17th century, with most convinced that bitcoin was a bubble. However, since 2017, bitcoin and other cryptocurrencies have come a long way in terms of maturity. Bitcoin fundamentals are stronger than ever, institutional interest is at an all-time high and mainstream adoption is on the rise, strengthening the argument for why the market is not based totally on hype this time.

sceptics compared it to the Tulip mania of the 17th century, with most convinced that bitcoin was a bubble.
sceptics compared it to the Tulip mania of the 17th century, with most convinced that bitcoin was a bubble

Earlier this month, Blockchain.info reported that bitcoin’s hash-rate – the speed at which a bitcoin mining machine operates – reached a historical high of 74,548,543 terahashes per second. In simpler terms, the bitcoin blockchain is more secure than it ever has been and breaching the network would require unimaginable computing power. In addition, the average number of transactions on the blockchain has consistently risen. As reported by localbitcoins.org, the weekly average transaction volume has remained above US$50 million since September 2017.

Daily active bitcoin wallets crossed the 1 million mark in June this year, according to data published by Coin Metrics, providing another indication that more people are now using bitcoin.

Institutional Investment in Bitcoin Gaining Traction
Institutional Investment into Bitcoin Gaining Traction

Institutional Investors are Coming

Institutional involvement in the cryptocurrency space, over the past year, has been incredible. It is easy to argue that the 2017 bull-run was largely fuelled by retail investors. This time around, institutional investment in cryptocurrencies has gained traction.

Will China be forced to develop its own cryptocurrency in response to Libra?

Fidelity is set to launch cryptocurrency trading for institutional investors, seeing huge demand in that niche. Earlier this month, CME Group recorded open interest – the number of active contracts held by investors – in 5,311 contracts, totalling 26,555 bitcoin, significantly higher than the 2017 price peak.

Furthermore, JP Morgan, one of the biggest investment banks in the world, launched its own token, JPM coin, to settle payments between institutional clients. The biggest social network in the world, Facebook, is set to launch its own cryptocurrency, Libra, next year. Regardless of the use cases of these institutional cryptocurrencies, they are a step in the right direction, giving more legitimacy to the industry.

A technician monitors cryptocurrency mining rigs at a Bitfarms facility in Saint-Hyacinthe, Quebec, Canada, in July 2018. Photo: Bloomberg
A technician monitors cryptocurrency mining rigs at a Bitfarms facility in Saint-Hyacinthe, Quebec, Canada, in July 2018. Photo: Bloomberg

Is Bitcoin Digital Gold?

To most, the thought of bitcoin as a safe haven may sound completely absurd given its volatility. However, a recent study from Grayscale Research analyses the correlation between bitcoin and macroeconomic developments, illustrating the use of bitcoin as a hedge against political unrest and macroeconomic uncertainty.

Even though bitcoin does not really feature in the conventional list of safe havens, more people are relying on the cryptocurrency as a hedge against movements in the “traditional” financial market. Correlation does not necessarily mean causation but the key takeaway here is that bitcoin and other cryptocurrencies are becoming more popular among investors for diversifying their portfolios.

To stimulate their economies, central banks around the world are turning dovish: cutting interest rates and printing more money. While this has made investors rejoice in the short term, bitcoin holders are confident that in the long term, bitcoin will outperform fiat currencies, the supply of which is growing at a rapid pace.

Read: Why the stock market rally will not last long

The Cryptocurrency Market Has Matured Weathered, with some gray hairs the digital currency is still kicking
The Cryptocurrency Market Has Matured

The cryptocurrency market is definitely more mature than it was during the last bull run and there is more intelligent money in the market than there was the last time. Fear of missing out will still definitely be a huge catalyst in driving up prices but we cannot ignore the other developments that have added legitimacy and increased the ways in which cryptocurrencies could be used, paving the way for mainstream adoption.

How prices will move remains of interest. Past performance is not an indication of future results, but if the observed pattern were to continue, we could be looking a year-end price well above the US$20,000 mark.

Bitcoin Volatility Lowest Levels Since May

  • Bitcoin’s price volatility, as represented by Bollinger bandwidth, has hit the lowest level since May 3, and is closing on a level seen ahead of violent price swings in the past.
  • While technical charts are increasingly favoring a downside move, bitcoin’s non-price metrics continue to call a bullish move, which, so far, has remained elusive.
  • BTC risks falling to $9,855 (Sept. 11 low) in the next couple of days and could extend the decline toward $9,320 (Aug. 29 low).
  • The bearish case would weaken above Sept. 13’s high of $10,458. The outlook, as per the daily chart would turn bullish above $10,956 (Aug. 20 high).
Bitcoin Price Forecast 2019

Bitcoin’s volatility has hit its lowest level in over four months – a price squeeze that may force a significant move either way.

BTC’s bull run stalled at highs above $13,800 on June 26 and prices have created lower highs and higher lows ever since.

Notably, the trading range has narrowed sharply over the last two weeks, with bitcoin consolidating between $9,850 and 10,950, as per Bitstamp data.

As a result, the Bollinger bands – volatility indicators placed 2 standard deviations above and below the price’s 20-day moving average – have narrowed sharply.

More importantly, Bollinger bandwidth, an indicator used to gauge market volatility, has dropped to 0.11 – the lowest reading since May. 3, as seen in the chart below.

Bollinger Bandwidth

The volatility level has dropped steadily from 0.62 to lows near 0.10 in the 2.5-months.

In the past, BTC has witnessed big moves following drops to or below 0.10 (marked by arrows).

For instance, the bandwidth dropped to 0.06 a week before BTC broke into a bull market with a high-volume move to $5,000 on April 2. It also fell to 0.10 on May 2 – a day before BTC jumped above $5,600, marking an upside break of a three-week-long consolidation. And, in the days leading up to last November’s sell-off below $6,000, volatility dropped to 0.05.

If history is a guide, then BTC could soon witness a big move on either side. Technical analysis theory also states than an extended period of low volatility is often followed by a big move.

While the record high hash rate (miner confidence) is calling a bullish move, the technical charts are beginning to favor the bears.

As of writing, BTC is changing hands at $10,170 on Bitstamp, representing little change on a 24-hour basis.

Daily chart

Bitcoin jumped 2.6 percent on Sept. 12, confirming an upside break of a falling wedge pattern. The bullish breakout, however, failed to draw bids and the cryptocurrency has ended up creating another lower high at $10,458 (Sept. 13 high).

With the failed breakout, the bearish view put forward by Sept. 6’s big red engulfing candle has gained credence.

BTC risks falling back to the Sept. 11 low of $9,855 in the short-term. A violation there would open the doors for $9,320 (Aug. 29 low).

A few observers are calling for a deeper drop to levels below $8,000. That possibility cannot be ruled out as the cryptocurrency is looking heavy on the longer duration charts.

Monthly and weekly charts

The back-to-back inside bar candlestick patterns on the monthly chart (above left) indicate buyer exhaustion following a stellar rally from $4,000 to $13,880.

A bearish “inside bar” reversal would be confirmed if prices close (UTC) below $9,049 – the low of the first inside bar created in July – on Sept. 30.

Further, a negative reading on the weekly moving average convergence divergence (MACD) indicates scope for a deeper pullback.

The bearish case would weaken if prices rise above $10,956 (Aug. 20 high), invalidating the lower highs setup on the daily chart.

That said, a weekly close (Sunday, UTC) above $12,000 is needed for bull revival, as discussed last month.

Article by

Sagar Chaudhary

Sagar Chaudhary  

South China Morning Post

&

Omkar Godbole

Omkar Godbole

Coindesk

Source: https://cryptoclarified.com/bitcoin-bull-run-more-than-hype-this-time-dont-be-surprised-by-a-us20000-price-tag-by-year-end/

Blockchain

TomoChain Builds on Blockchain Commerce Following Lition Acquisition

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Tomochain, the Singapore-based smart contract platform, has taken another stride towards its aim of hosting government and enterprise applications with its acquisition of Lition, a German company that provides public and private blockchain services.

Launched on Ethereum in October 2020, Lition represents a bridge between public and private blockchain use-cases with its ability to delete privately hosted data in accordance with the EU’s General Data Protection Regulation (GDPR) guidelines.

This aligns with TomoChain’s goal to entice governments and enterprises to utilize its platform – a goal that has historically been fraught with concerns over regulatory compliance.

TomoChain Eyes European Market

TomoChain is expected to leverage Lition’s experience in navigating Europe’s regulation-heavy blockchain landscape. Lition has already created a multi-million dollar peer-to-peer marketplace that connects renewable energy providers with consumers. Lition also recently piloted a $20 million loan between two of Germany’s VR Bank cooperatives and a national real-estate developer.

Combined with Lition’s recent efforts in creating Proof-of-Existence service, which verifies legal documents on the blockchain for EU clients, TomoChain will seek to take advantage of Lition’s breakaway success and use it to help create large-scale solutions for healthcare and automotive industries.

“Lition’s assimilation into our Enterprise division strengthens TomoChain’s consultation services and product development for large-scale enterprises, as well as for government,” said Long Vuong, Founder and CEO of TomoChain, adding, “We intend to optimize Lition’s core technology as a base to further extend digital money and other financial products.”

The acquisition was celebrated by Lition founder and CEO Richard Lohwasser, who said:

“This is a great day and a defining moment for Lition, adding, “We join a company in TomoChain with tremendous scale and resources, and a culture completely aligned with ours.”

The two sides will be holding a joint-AMA on October 30th where they’ll likely reveal more details about the acquisition and how the new structure will be implemented.

EU Embraces Digital Innovation

The EU recently accepted proposals for the creation of a pan-European regulatory sandbox for regulations pertaining to crypto-assets and distributed ledger technology. Although still in the pilot stage, the EU said it is open to ideas from companies and regulators and will facilitate the testing of innovative solutions hosted on the blockchain.

The European Commission has declared its ambition to move away from cash purchases in the EU region – a method of payment that still makes up 78% of transactions. Recent documents published in the EU policy publication Euroactiv revealed the EU would launch a comprehensive set of crypto regulations by no later than 2024.

While the acquisition of Lition will help TomoChain gain a stronger foothold in EU markets, the newfound relationship will also help Lition expand into TomoChain’s native markets in Asia. Lition CEO Richard Lohwasser said the acquisition would help accelerate the growth of the company on a global scale.

“The acquisition provides Lition with the opportunity for greater reach throughout Asia, enhanced operational efficiency and innovations that will benefit everyone. We are excited to leverage our combined resources to accelerate the next stage of Lition’s growth into a global player,” said Lohwasser.

Lition is expected to become a key division in TomoChain’s blockchain ecosystem. Built on the Ethereum network, it will continue to work on creating scalable sidechains for use in commercial use cases. Meanwhile, TomoChain will use Lition’s private/public distributed ledger technology to target large-scale financial institutions.

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Source: https://cryptopotato.com/tomochain-builds-on-blockchain-commerce-following-lition-acquisition/

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Correction? $15 Billion Evaporate from Crypto Markets as Bitcoin Loses $700 in Hours

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There’s never a boring day in the cryptocurrency field. Yesterday, the entire community was ecstatic as Bitcoin’s price made a run for the 2019 highs. Unfortunately, it came inches away from it and started to retrace.

Today, the total cryptocurrency market capitalization is down about $15 billion since its most recent peak hours ago.

Bitcoin Price Down $700 in Hours

Crypto bulls would have to wait another day as the most recent surge has been halted. Bitcoin’s price lost about $700, crashing from a high of $13,859 to an intraday low of $13,142 on Binance.

As CryptoPotato reported earlier today, BTC’s price came very close to breaking the peak of 2019 but failed to do so.

In any case, the price has currently settled above $13,250, and it’s interesting to see where do we go from here. Should the bulls continue to dictate the pace, $13,400 is the immediate mark to look for. On the other side, $13,150 and $13,000 are the closest support areas to defend.

btcusd_chart
BTC/USDT. Source: TradingView

Altcoins Suffer Just as Much

As it’s almost always the case, the negative move in Bitcoin’s price dragged the entire market down as well.

Altcoins are also deep in red, and most of them are charting substantial decreases.

heatmap
Cryptocurrency Market Heatmap. Source: Quantify Crypto

As can be seen on the above heatmap, Ethereum is down to below $390, while other majors such as Ripple, Binance Coin, Link, and so forth are also bleeding out.

However, Bitcoin’s dominance took a hit, and it lost about 0.4% in the past few hours, meaning that altcoins managed to reclaim some grounds.

Elsewhere, the pain is felt on legacy markets as well. At the time of this writing, S&P 500 futures are trading at a 2% loss, while NASDAQ futures are down about 1.65. The Dow Jones Industrial Average (DJI) is down a whopping 2.2%.

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Source: https://cryptopotato.com/correction-15-billion-evaporate-from-crypto-markets-as-bitcoin-loses-700-in-hours/

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ETH Price Analysis: Ethereum Says Goodbye to $400 As Sentiment Turns Bearish

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ETH/USD – Bulls Defending .382 Fib Retracement

Key Support Levels: $377, $370, $364.
Key Resistance Levels: $400, $410, $416.

Toward the end of last week, Ethereum surged higher from $370 as it climbed above the $400 level and managed to reach as high as $421 (1.414 Fib Extension). More specifically, it was unable to close a daily candle above the $416 resistance (bearish .618 Fib Retracement) throughout the weekend which caused it to drop beneath $400 on Monday.

Yesterday, the buyers did attempt to recover as they spiked into the $410 resistance. However, the sellers returned today to push ETH into the $389 support (.382 Fib Retracement). The support here is further bolstered by Octobers’ rising trend line.

ethusd-oct28
ETH/USD Daily Chart. Source: TradingView

ETH-USD Short Term Price Prediction

Looking ahead, if the sellers break beneath $389 and push below the rising trend line, the first level of support lies at $377 (.5 Fib Retracement). Following this, support is found at $370, $364 (2019 High), and $355 (100-days EMA).

On the other side, the first level of resistance lies at $400. This is followed by $410, $416 (bearish .618 Fib), and $421 (1.414 Fib Extension).

The RSI has returned to the mid-line to indicate indecision within the market. If it dips further beneath the mid-line, the sellers will gain control of the market momentum and will likely push ETH beneath the current trend line.

ETH/BTC – Sellers Push Coin To 3-Month Lows

Key Support Levels: 0.0288 BTC, 0.0284 BTC, 0.0281 BTC.
Key Resistance Levels: 0.03 BTC, 0.0305 BTC, 0.0311 BTC.

Against Bitcoin, Ethereum has struggled heavily in October as it reached a 3-month low today. Earlier in the month, ETH fell beneath a symmetrical triangle which was the first sign that there was some downward pressure ahead.

This week, ETH dropped beneath the 0.03 BTC level a couple of days ago. Yesterday, ETH continued lower as it fell beneath the 200-days EMA to reach the current 0.0292 BTC support today.

ethbtc-oct28
ETH/BTC Daily Chart. Source: TradingView

ETH-BTC Short Term Price Prediction

Looking ahead, if the sellers continue to drive lower, the first level of support lies at 0.0288 BTC. This is followed by support at 0.0284 BTC (Feb 2020 High), 0.0281 BTC, and 0.0278 BTC.

On the other side, the first level of resistance lies at 0.03 BTC. Above this, resistance is expected at 0.0305 BTC, 0.0311 BTC, and 0.032 BTC (100-days EMA).

Both the RSI and Stochastic RSI are in extremely oversold territory which shows the sellers might be a little overextended.

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Disclaimer: Information found on CryptoPotato is those of writers quoted. It does not represent the opinions of CryptoPotato on whether to buy, sell, or hold any investments. You are advised to conduct your own research before making any investment decisions. Use provided information at your own risk. See Disclaimer for more information.

Cryptocurrency charts by TradingView.


Source: https://cryptopotato.com/eth-price-analysis-ethereum-says-goodbye-to-400-as-sentiment-turns-bearish/

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