Price point
Bitcoin (BTC) was flat after it jumped to a new 2020 high above $ 12,400 on Monday.
Analysts are now speculating whether the largest cryptocurrency may hold the higher ground. The latest increase came at full volume, and it was a “convincing break,” Denis Vinokourov, head of research for crypto-prime maker BeQuant, told CoinDesk. All day Monday was just 11% off the 2019 peak of $ 13,880.
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Elsewhere, prices for the recently and early-launched Curve DAO token slipped 26% on Monday, even though total value locked into the affiliated Curve Finance protocol went above the $ 1 billion mark. That’s a fivefold increase from last week, in the latest episode of this year’s frenzy in decentralized finance, as DeFi.
Market moves
Suddenly, it’s not just Bitcoiners who think the dollar is going down
When the news broke in recent days that Warren Buffett’s Berkshire Hathaway had bought shares in a gold miner, commentators immediately began to question whether the billionaire investor might be betting against the US economy rather than the dollar.
Bitcoin analysts and investors wondered why it took him so long to see the vibrations of dollars of money pumped into the financial system this year by the Federal Reserve to help finance the US national debt.
“The money printer works redundantly, of course, Buffett and his board are very worried,” Mati Greenspan, of the foreign exchange and crypto-research firm Quantum Economics, wrote on Monday. “While Buffett may not be so sure how to react to a world that no longer holds bonds and government debt, others are sure.”
There is a growing awareness among members of the cryptocurrency community that their long-standing assessment of the traditional financial system as unsustainable is finally gaining traction among Wall Street experts and mainstream investors. If the concerns spread, it could boast prices for bitcoin, which many investors of digital assets see as an inflation hedge equal to gold.
Goldman Sachs, which hailed bitcoin as “not a suitable investment” in May of this year, announced a new head of digital assets earlier this month and recognized growing interest in institutional customers’ cryptocurrencies. The company warned in July that the U.S. dollar was at risk of losing its status as the world’s reserve currency.
Dick Bove, a five-decade Wall Street analyst who now works for the brokerage firm Odeon, wrote last week in a report that the dollar-controlled financial system could come to an end amid challenges of a possible system with more faluta, which ü.o. digital currency.
“The case for bitcoin as an inflationary hedge and sound investment is articulated with crystal clearness by influential people outside our crypto bubble,” the research firm Messari wrote last week. Buffett did not return a call for comment.
Dollar dominance on the way?
Whether bitcoin and other cryptocurrencies are the answer or not, there is not much on the horizon that might deter investors from the grinning sense that U.S. finances are becoming more accurate.
Goldman Sachs ecologists predicted in a August 14 report that the Federal Reserve will pump $ 800 billion more into financial markets by the end of this year, followed by another $ 1.3 trillion in 2021.
According to Bank of America, there is a risk that investors may move their “portfolio allocation out of US dollar asset” to position for the “erosion of the hegemony of the dollar as a reserve currency.”
“A constitutional crisis is one dynamic that could potentially accelerate the process of de-dollarization,” she wrote, noting that the November presidential election could be “fiercely divisive” and “combative.”
According to the bank, a recent survey of fixed-income executives showed nearly half of respondents expect foreign central banks to reduce their reserves of dollars and dollar-denominated assets next year.
It may not sound foreign to bitcoin bulls.
Bitcoin watch
Bitcoin rose 3.2% Monday to about $ 12,300, confirming an upward triangle break on the daily chart.
The pattern continued the July trend low below $ 9,000. The focus is now on resistance at $ 13,200 (July 2019 high) and $ 13,800 (June 2019 high).
“The market is looking at the height of 2019, and that’s the level to look at,” Joel Kruger, a currency strategist at LMAX Digital, told CoinDesk in a Twitter interview.
The data on the chain support ongoing gains in bitcoin. For example, the balance of currencies held on crypto exchanges fell on Monday to 21-month low, indicating a strong holding sentiment in the investor community.
The bullish momentum looks strong when the recent gains of the cryptocurrency are accompanied by increased mineral supply. According to figures from the rolling inventory (MRI) of crypto-data company ByteTree, miners have taken inventory by selling more than what they think over the past five weeks. In other words, buyers are able to absorb additional mineral supply.
From a technical analysis perspective, the bullish bias would be invalid if prices fell back below $ 12,000 on Tuesday.
Token watch
OMG (OMG) gets boost from blockchain backup: Rising congestion on the Ethereum blockchain spurt interest in crypto projects that may speed up on the network. Prices for OMG, the token for the OMG network – a “layer-2” scaling solution for Ethereum transactions – rose more than 70% last weekend, according to data source CoinGecko. It reached as high as $ 3.30 earlier on Monday and then quickly fell below $ 3. The OMG network uses a protocol called Plasma to scale up Ethereum transactions. Market participants are looking to OMG for “spreadhead layer-2 solutions”, said Denis Vinokourov, head of research at London-based digital asset company BeQuant.
Orchid Protocol (OXT) decreases even though it is not a DeFi token: Prices for Orchid, the nationwide token for a blockchain project that enables Orchid Labs’ private internet browsing, hit a full-time high at $ 0.84 over the past weekend, five times up from a low in March, according to CoinGecko. Barstool Sports’ David Portnoy, who claimed to have at least $ 1 million worth of bitcoin after meeting with the Winklevoss twins of the Gemini cryptocurrency exchange last week, tweeted earlier Monday that he had invested in OXT . “I’m in the shitcoin $ ox right now,” Portnoy wrote on Twitter, with a hashtag of “#pump.” The Orchid project has previously raised $ 43 million for its token sales, as reported by CoinDesk. Major investors included big names such as Andreessen Horowitz and Blockchain Capital.
Ethereum Classic (ETC) against delisting? Malta-based OKEx said it could consider withdrawing Ethereum Classic from trading on its exchange after losing about $ 5.6 million from ETC from two recent 51% attacks. It will not be an easy decision to make, Chief Executive Officer Jay Hao told CoinDesk, considering that OKEx has the highest trading volume of ETC among crypto exchanges. However, the impact of the two attacks on ETC prices has not been significant: ETC’s price was still around $ 7 on Monday, not much changed from the week before the attacks first took place on 1 August.
The analog
The Federal Reserve supports the junk-bond market.
Economist says the “real recession is yet to come.”
George Soros says the market persisted by expecting more stimulus.
Bond market seems to believe that Fed will not fight inflation.
China regulator says Fed money printing erodes dollar dollar, financial stability.
Japanese economy shrank the most on record.
Tweet of the day
What’s called
Bitcoin DeFi can be unstoppable: what does it look like? (CoinDesk)
One of the quietest but best funded bitcoin companies in the world is geared up to enter the decentralized bull run of 2020.
‘Link Marines’ create an obscure cryptocurrency Red Hot (Bloomberg)
Chainlink’s meteoric rise to fifth place in market value is this year’s crypto success story, mostly driven by widespread growth in DeFi revenue.
Top Bitcoin Mining Pools See 15% Hashrate Drop Amid Sustained Rainstorms in China (CoinDesk)
Large Chinese bitcoin mining pools each see daily hashrate drops of between 10% and 20% following persistent rainstorms in Sichuan.
