Weekly Crypto Report — 30.09.2019

News Roundup

Another week has rolled by in the crypto-sphere and it was a busy one. To be fair, it’s never really quiet in the market that doesn’t sleep. Just in time to kickstart your week, here is your regular weekly market outlook, complete with a look-back at last week and what’s coming up this week. We’ll also give you intelligent price analysis on some of our most popular trading pairs. Ready? Let’s do it!

Key Market Event — Underwhelming Bakkt Launch

As we mentioned in our previous article, last week was all about Bakkt. The Bitcoin futures institutional exchange platform, founded in 2018 by the Intercontinental Exchange (ICE), the parent company of the New York Stock Exchange (NYSE), finally launched last Monday 23rd September.

After more than a year spent ensuring full compliance with the United States authorities, Bakkt, the first federally regulated platform for Bitcoin (BTC) futures trading was up and running. This highly-anticipated launch was the focus of a massive amount of speculation, with many traders, investors and analysts convincing themselves that this new market entry point for institutional investors was all that was needed for crypto to reach the stars.

However, the trading volumes on the platform were pretty low, following an initial surge.

Bakkt Bitcoin (USD) monthly futures contracts. Source: ICE

To make matters even worse, Bakkt’s launch came at the exact same time as a BIG slump in Bitcoin’s market price, leading many fundamental analysts to suspect a connection between the two events.

To make matters even worse, Bakkt’s launch came at the exact same time as a BIG slump in Bitcoin’s market price, leading many fundamental analysts to suspect a connection between the two events.

Despite the underwhelming launch, there’s no doubt that Bakkt’s debut is a major milestone on the timeline of crypto adoption. The presence of institutional investors is something that all crypto enthusiasts will be extremely excited about. The story is only just beginning!

Now, let’s dig into that Bitcoin slump...


Price Analysis

At the beginning of last week (23.09), the total crypto market capitalisation was $264.02 billion. The market closed the week with a total market capitalisation of $213.37, signifying a heavy decline by $51.02 billion (19.32%) over the week.

Our Hottest Instruments

Last week’s hottest pairs at the DSX exchange were BTC/USD, USDT/USD and EOS/USD. Let’s take a closer look at these guys and see what they went through and what might be coming up...

BTC/USD
It was a difficult week for BTC, which saw the digital gold collapse to just over $8,000, at the time of writing.  A stark drop from the early September high of $10,600 and a sign of its continuous bearish momentum. The real question is, why? Many traders and investors panicked when they saw the sudden drop and, at first, the reason wasn’t clear.

As mentioned, some fundamental analysts have attributed this sharp downward move to the lackluster launch of Bakkt, which didn’t live up to the hype — to put it mildly.

That’s not the only explanation, though. Many analysts and traders believe that Bitcoin has slowly been growing more sensitive to geopolitical tensions and global economic events. Some have said that the price drop could be linked to the injection of hundreds of billions of dollars into the financial system by the Federal Reserve. Whether Bitcoin is now more geopolitically aware remains to be seen, but it’s definitely something to keep in mind going forward.

The next support for BTC is around the $7,400 to $7,500 zone. If the BTC/USD pair does begin to pull up strongly from the support zone, more aggressive traders may begin to feel comfortable opening a long position. Patience is going to be key.

USDT/USD
Tether became the fourth biggest crypto by market capitalisation this week, leapfrogging Bitcoin Cash (BCH) which has taken a battering in the recent market downturn, shedding around a quarter of its value over the past week. Tether’s stay in the top four could be rather short lived if BCH picks back up.

As Tether is the world’s most prominent stable coin, it’s quite easy to deduce the reasoning behind its recent upturn in volumes. Traders and investors are looking for a safe-haven to ride-out the crypto dip, and they’re turning to Tether — a crypto which is pegged to the value of the US Dollar. It’s likely that it’s volumes will continue to remain high while there is such uncertainty and even more potential for volatility in the wider market.

EOS/USD
EOS hasn’t seen much price action over the past few days and is currently trading sideways, with its price running near the $3 mark.

The first target for EOS is to break that $3 resistance. Once through, EOS should have the momentum to make it into the $4 territory in the long run. Further resistance will come just short of the $5 area. If EOS can break its next resistance, the bulls will need to work hard to keep it there.

Support levels of $2.50 and $2.20 are not too far away and traders should be wary of potential slippery downwards movements.


Weekend Crypto News Recap

  • Facebook’s Zuckerberg can’t commit to 2020 Libra launch: Executives of the Libra Association have recently claimed that their cryptocurrency will have launched by 2020. Contrary to this, Facebook’s CEO, Mark Zuckerberg, has stated that he isn’t 100% sure on the launch date, citing regulatory concerns.
  • Venezuela gunning for crypto: According to Bloomberg, Venezuela’s central bank is apparently investigating whether it can legally hold cryptocurrency. A state-run enterprise, Petroleos de Venezuela SA, is trying to get the central bank to use Bitcoin and Ethereum in financial transactions.

Crypto — Did you know...

...that China is the world’s largest miner?Mining cryptos is not as easy as it used to be. To be a successful miner today, you need a lot more time and resources than you did a few years ago. China remains the biggest player when it comes to mining crypto, maintaining around 75% of the Bitcoin mining network.

See you soon,
The DSX Team

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