After the kickoff of trading in CME Bitcoin futures, Bitcoin reached a new high and has hit a bit of a break in the ongoing rally. But the ones who stole the show this week, are the Altcoins!
Recently, during the Bitcoin Rally, most of the Alts had fallen against Bitcoin’s price, but the market is beginning to wake up. The opening of trading in CME (around the 18th), and the break of the Bitcoin rally, led to a sharp rise in the alcoins market, some of which rose by hundreds of percentages against the dollar, and tens of percentages against the Bitcoin. The market is cyclical, this is something we have seen from all of our previous market updates. The growth of the Alts against the Dollar may affect newcomers looking for new investments. The dominance of Bitcoin over altcoins, currently stands at around 50%, with a 5% drop during the past week. It seems that the additional fragmentation in Bitcoin no longer affects the market for the Alts, as it has in the past. The next test of the Alts will be if and when, Bitcoin passes $20K. It is also interesting to see how they will react to the decline against the dollar exchange rate – will they preserve their dollar value? Or will they hurt too? We are in a period of peaks in the crypto market, therefore, it’s difficult to know. In addition, the launch of the Lightning network in the near future which may affect the interaction between the Bitcoin and the Alts.
Market cap – Comparing to Bitcoin, it seems that the Alts have more room to go up. As the value of Bitcoin remains high, we may see the Alts continue to break records against the US Dollar. This could lead to a big bubble in the altcoins market. The interest of new investors in the market is really felt and reflected in the continued growth in trading volume. As of this market update, the overall value of the crypto market has exceeded $600 billion. Could we be on the way to a trillion dollars?
More from this week
Forecasts of the banks
Saxo Bank of Europe issued a statement expressing mixed feelings towards Bitcoin. They stated that in 2018 Bitcoin’s rate could rise up to $60K and the trading volume of the coin would exceed the trillion mark up. Additionally in 2019, governments worldwide, especially China and Russia, would take measures to prohibit trading in cryptocurrencies and will develop crypto-coins of their own. This will cause Bitcoin’s price to fall down to about $1,000.
Staying in the banking sector: the Governor of the National Bank of Denmark announced that Bitcoin is dangerous and compared Bitcoin investments to gambling in casinos. He stated that; “This is mainly due to the lack of regulations on the matter.”
The governor of the Bank of Canada also expressed some concerns about the stability of cryptocurrencies and their effects on the banks, but his approach appears to be more moderate.
Jordan Belfort, the character who inspired “The Wolf from Wall Street”, claims that Bitcoin is a fraud and that sooner or later the price of Bitcoin will drop. After a rise of more than 1500% in the past year, will Bitcoin’s run end?
The position of the authorities
The US Securities and Exchange Commission issued a statement encouraging investors to be “open” to the new opportunities of crypto, but also to be cautious. They reiterated a statement we at CryptoPotato make all the time. That is – invest only as much money as you can afford to lose it.
South Korea is stepping up its regulation against Bitcoin and cryptocurrencies and has issued a statement barring banks from engaging in any crypto activity. Minors and foreigners will be banned from opening a trading account in South Korea. After the government announced the heighted amount of regulation, the Korean Blockchain Industry Organization announced that it had implemented internal regulation in about 40 companies in the field, including 14 exchanges.
More in the Asian sphere: the Indian Tax Authority has begun taking active measures to collect capital tax gains from traders and Bitcoin investors. In addition, the government appears to be targeting ICO issuers.
On the other side of the world, it seems that the US is also considering a tax reform that will benefit the crypto investors.
In Europe, the European Union announced that it intends to formulate strict regulatory rules for the crypto market in order to increase transparency in the sector and especially in the money changers. This is to make it easier for the authorities to match money laundering and acts of terrorism.
On the political front, Gibraltar and Estonia seem to be promoting moderate regulation to become leaders in the crypto market: Gibraltar in January of 2018, is planning a new regulatory framework for DLT-based projects, particularly for cryptographic currencies. This is a moderate and clear regulation, which may encourage investors and entrepreneurs in the field to invest and open their gazes in the country; And Estonia is planning to launch a program to set up a capital market for the Crypto-Capital market.
The high inflation in the local currency in Venezuela (536% between January and October of this year) led to an increase in the demand for cryptocurrencies, and for Bitcoin in particular. In Japan, we see a trend in which investors are abandoning leveraged foreign currency trading, in favor of leveraged trading in the crypto market. The first billionaires from Bitcoin, the Winklevoss twins, call on JP Morgan’s CEO, Jamie Damon, to start a short investment onto a Smart Contract, as to test his belief that Bitcoin is a fraud.
People began taking mortgages and loans to finance investments in Bitcoin, and the crypto market is beginning to have a real impact on the stock markets. With companies like Natural Resources and LongFin Corp jumping 2600% in value after announcing the adoption of blockchain technologies. The brokerage firm TD Ameritrade announced that it would enable trading in Bitcoin in futures contracts through CBOE.
Two of the largest banks in South Korea announced that they had participated in Ripple’s pilot program alongside Japan Bank Consortiu in order to examine the assimilation of its technology (ripplenet).
BitPay now support Bitcoin Cash, as does their wallet, which can also hold BCash.
Due to the rising of Altcoins this week, we would like to mention a short Reddit post about a person who explains how he lost $40k out of his $50k investment, by investing in alts without investigating them in depth. So make a research before investing
Against the dollar, Bitcoin continues to skyrocket where it has reached almost $20K last week. At BitStamp, the peak was $19,666. After a slight decline from the peak, the price of the past day was trading around $18K, with looks around $17.5K support level with resistance around $20K. Looking back, just last week we were at $16k. Trading volume did not rise significantly in the last week of the rally, and the RSI is still lower on the daily chart.
Against the dollar – We see a new record for Ethereum! It broke resistance at $400 last month, which led to the price at new heights and a peak of $865, with support built around the $700 range. The rise has been very rapid, but as we all know, in the crypto market there are no real limits to volatility. As of this update, Ethereum is traded around $800 with next resistance at $900. Is the $1,000 mark in sight? Does anyone remember that only a year ago the value of the Ethereum was $8?
Compared to Bitcoin, the price is in a light blue box that we marked from previous updates. In our estimation, we will see the floor area of Ethereum at a directly opposite correlation to Bitcoin. In the daily chart, the value traded around 0.045BTC with resistance in these areas, and strong support at 0.037BTC. Breaking through these price levels will allow us to return to previous levels around 0.05BTC.
Against the dollar, the altcoin rise did not skip Bitcoin Cash, and its price rose by over 50% last week and reached a level of over $2,400. This is very close to the peak we saw in November when it’s price reached $2,500 for a very short term. Support for these prices ranges around $2000.
Against the Bitcoin – On our previous update, we saw the growth in trading volume and the changes in trends. It appears that the price actually reached the range of resistance in the 0.135BTC area. In these areas, there is strong support level around the BTC 0.1, and resistance (which is very close) can be seen around 0.16BTC.
Our speculations of what led to increases – the impact of the increased value in the market for the ATS and the addition to BITPAY.
Against the dollar – After the break of resistance around the $400, ZCash’s price surged to new highs at $600. Pretty excited! It is now being traded close to its record, support level is around $450.
Against Bitcoin, there has been a sharp rise recently on the way to the resistance areas around 0.036BTC. From these areas, it will be possible to break through. Support lies around 0.03BTC for the short term.
Against the dollar, sharp rises brought the price level to $3, but we reached resistance in these areas. On the weekly chart we can see the rising trend, with support in the $2 zone.
Against Bitcoin – the rate corrects upwards towards the resistance zones around 0.00018BTC. Traded in these areas with support around 0.00014 BTC.
Against the dollar, after peaking at a record $19 in the past 24 hours, it is traded around $15 with support around $13.
What is interesting here, is the graph against Bitcoin – the support areas that came in the wake of the large rally at the beginning of the year, led to rise in volume, and it seems that the price reached a resistance point (marked in red). From this point, it can be possible to break through. Resistance lies in these areas as mentioned, and support around 0.00076BTC.