$51K Bitcoin price not a problem as ‘structurally, nothing has changed’

On-chain data points toward a bullish future for Bitcoin despite today’s sell-off to $50,400.

On March 25, concerns surrounding the record-breaking $6.1 billion (BTC) options expiry this Friday sparked an overnight sell-off that dropped Bitcoin price to $50,400.

The downturn was not a surprise for many traders and some called for a possible test of the $47,000 support level. Despite Bitcoin’s loss of bullish momentum, several derivatives indicators, including a bullish futures premium and a neutral skew, suggest that the price may not drop below $50,000.

BTC/USDT 4-hour chart. Source: TradingView

While technical indicators paint a mixed picture of Bitcoin’s short-term price action, the asset retains strong fundamentals today media reported that sovereign wealth funds have begun inquiring about opening positions in BTC. This points to growing global adoption for BTC and the cryptocurrency sector as a whole as new Ether (ETH) trusts are also being established to serve institutional investors.

Analysts suggest the market is oversold

Glassnode co-founder and CTO Rafael Schultze-Kraft recently highlighted a possible dip lower based on low realized price distribution between $51,100 and $54,000.

In a follow-up tweet after Thursday’s drop, Schultze-Kraft reaffirmed that the dip was “not unexpected” and in his view, the overall outlook remains bullish.

Schultze-Kraft said:

“Structurally, nothing has changed. I have yet to see a data point that points long-term bearish.”

Further evidence of a possible turnaround in the near-term can be found when looking at Bitcoin’s liquid supply change, which decreased by the largest amount in more than 6 months.

Bitcoin liquid supply change. Source: Glassnode

This suggests that a large number of BTC have been pulled out of the circulating supply and deposited into longer-term storage wallets as bulls prepare for the price to trend higher.

Altcoins sink lower

A majority of the altcoins were hit hard by the Bitcoin sell-off as traders across the market exited positions in an attempt to hold on to their recent gains.

Daily cryptocurrency market performance. Source: Coin360

The one stand-out among altcoins is Aragon (ANT), whose recent pivot toward DeFi and nonfungible tokens has helped to spark a 50% rally to $13.56.

Holochain (HOT) and Balancer (BAL) have also managed to put up a positive gain of 5.2% and 6.4% respectively.

The overall cryptocurrency market cap now stands at $1.62 trillion and Bitcoin’s dominance rate is 59.4%.

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.

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Bitcoin bulls take a breather while BTC price slips below $55,000

Sellers pushed Bitcoin price below $55,000 even as record-high BTC futures open interest and optimism surrounding the issuance of $1,400 stimulus checks for Americans had traders anticipating a rally.

Bitcoin price sold off on March 15 as bears pushed the price back into the mid-$50,000 range a few days after (BTC) hit a new all-time high above $61,000. 

Data from Cointelegraph Markets and TradingView shows that Bitcoin price dropped as low as $54,600 and at the time of writing, buyers have not stepped in to arrest the decline.

BTC/USDT 4-hour chart. Source: TradingView

A series of recent developments have increased the fear, uncertainty and doubt (FUD) factor for the top cryptocurrency, including rumors of a potential digital asset ban in India that would criminalize the possession, issuance, mining, trading and transfer of cryptocurrency.

Adding to the bad news of the day, PancakeSwap (CAKE) and Cream Finance (CREAM), two of the top DeFi projects on the Binance Smart Chain, fell victim to a DNS spoofing attack that sought to phish users into entering their private keys on the website.

Both projects immediately informed users of the exploit and advised them to avoid logging in until the issue is resolved. and are reminded to keep their private keys and seed phrases secure and stored offline. At the daily close CAKE price was down by 8.7% and CREAM dropped by 14.3% before recovering to $110 at the daily close.

The bullish uptrend remains intact

Despite Monday’s decline, traders are optimistic that BTC will see a rapid recovery and a recent survey estimates that up to 10% of the $400 billion in pandemic relief for U.S. citiz could be used to purchase Bitcoin and stocks.

Another bullish sign for BTC comes from the futures markets, where a record $22.5 billion in open interest on BTC futures indicates that bulls remain optimistic that the current uptrend will continue.

According to Chad Steinglass, Head of Trading at CrossTower, the early morning sell-off was not surprising due to several factors including less liquidity on the weekends which can lead to “liquidations in highly levered swap and options products that trade outside of the U.S.,” exacerbating the downward movement.

Steinglass said:

“Couple this with the fact that China has been trading weak ever since the Lunar New Year in both equity and crypto markets, and a sell-off from the weekend highs, while disappointing, is not particularly surprising.”

Stimulus optimism leads to new record-highs in equities

The traditional financial markets rallied on Monday as optimism surrounding the recent $1.9 billion stimulus package signed by President Biden helped dampen concerns related to rising Treasury yields.

The S&P 500, Dow and NASDAQ all closed the day positive, up 0.65%, 0.53% and 1.05% respectively. The S&P 500 and Dow both establishing new all-time highs as the trading day closed.

Select altcoins ignore Bitcoin’s bearish turn

Daily cryptocurrency market performance. Source: Coin360

Despite the bearish turn of events, several altcoins were able to resist and rally higher.

Enjin (ENJ) saw its price surge 32% to a new all-time high of $3.00 during the early trading hours as the altcoins volume surged after being listed on Huobi exchange.

The dual-token system of VeChain (VET) and the VeThor Token (VTHO) also moved higher as a high volume spike lifted VET to a new all-time high at $0.0827. VTHO price increased 37% to $0.0119, its highest level in over two years.

BTC/USD daily chart. Source: Coin360

The overall cryptocurrency market cap now stands at $1.71 trillion and Bitcoin’s dominance rate is 60.9%.

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Altcoins sell-off after Bitcoin price rejects near its $58K all-time high

Altcoins are witnessing a bout of profit-taking after Bitcoin price failed to push through its $58,300 all-time high this week.

Optimism continues to percolate in the cryptocurrency sector on as recent gains in Bitcoin (BTC) have helped push the valuation of the top-ranked cryptocurrency past that of the South Korean won.

Data from Cointelegraph Markets and TradingView shows that the price of Bitcoin experienced a wave of selling in the early hours that pushed the price to a low of $54,948 before bulls returned to briefly push the price back above $57,000.

BTC/USDT 4-hour chart. Source: TradingView

Regardless of Bitcoin price action, institutional investors have consistently expressed their interest in BTC. Today, MicroStrategy announced that it had purchased another 262 BTC at an average price of $57,146, bringing the firm’s total holdings to 91,326 BTC.

According to David Lifchitz, Chief Investment Officer at ExoAlpha, how the price performs over the next few days will “show if Bitcoin is ready to reach new highs or if a pullback is on its way.”

Lifchitz pointed out that the price of BTC was down slightly on Friday after stalling “just a few basis points from its all-time high,” likely due to profit-taking “by those who monetized the 10% gain from $45,000 to $57,000.”

Bullish indicators for Bitcoin identified by Lifchitz include interest from institutional dip-buyers around the $45,000 level and the recently passed stimulus package from President Biden that according to him “may go straight into crypto buying.”

Lifchitz did concede that despite Bitcoin being price being in a long-term uptrend, there were some reasons for a more bearish outlook for the short term. A few factors to consider are the upcoming U.S. tax season which could prompt some investors to sell some of their holdings as a way to raise cash to pay taxes on profits realized during the 2020 financial year. 

Another short-term bearish factor Lifchitz identified was the possible spillover effect that could result from the sale of traditional assets which “are stretched by any measure and may see some profit-taking short term.”

Overall, Lifchitz concluded:

A sideways consolidation is likely here in the short term before a potential breakout to new ATH if the pullback holds ground as described above.

Investors jump headfirst into nonfungible tokens

Non-fungible tokens remain the dominant hot topic in the cryptocurrency space following th March 11 record-setting completion of the Beeple NFT auction for more than $69.3 million.

Chiliz (CHZ) is the breakout star of the day as $5.55 billion in 24-hour trading volume has lifted the blockchain-based fan engagement platform by 82% to a new all-time high at $0.59.

CHZ/USDT 4-hour chart. Source: TradingView

VORTECS™ data from Cointelegraph Markets Pro began to detect a bullish outlook for CHZ on March 10, prior to the recent price rise.

The VORTECS™ score, exclusive to Cointelegraph, is an algorithmic comparison of historic and current market conditions derived from a combination of data points including market sentiment, trading volume, recent price movements and Twitter activity.

VORTECS™ Score (green) vs. CHZ price. Source: Cointelegraph Markets Pro

As seen in the cart above, the VORTECS™ score increased from a low of 49 on March 8 to a high of 84 on March 10, roughly 24 hours before the price its 175% rally to a new all-time high over the next two days.

Decentralized finance projects have been in a consolidation phase as of late following substantial gains in the first two months of 2021 as top DEXs and DeFi platforms explore options like cross-linked chains and layer 2 solutions as a reprieve from high transaction costs on the Ethereum (ETH) network.

Polygon (MATIC) and SKALE (SKL) are two Ethereum scaling solutions that have outperformed their altcoin peers this week after both tokens saw near 100% rallies after listing on Coinbase on March 9. 

Daily cryptocurrency market performance. Source: Coin360

As a whole, the cryptocurrency market has fallen under some pressure as the weekend commences. The pullback is most likely the result of Bitcoin price rejected near its all-time high rather than a sign of a trend change but nevertheless, the majority of the large-cap cryptocurrencies have dropped by 2% to 10%.

The overall cryptocurrency market cap now stands at $1.71 trillion and Bitcoin’s dominance rate is 62%.

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.

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MicroStrategy Isn’t Done Buying Bitcoin, Now Holds $4.4 Billion In BTC

MicroStrategy Buys 295 More BTC for $10M, Now Owns 71,079 BTC Worth Over $2.4B

Microstrategy is not done stacking Bitcoin, despite being one of the most active institutional buyers in the market. The firm announced today that it had purchased an additional $15 million worth of Bitcoin. It now holds over 90,000 BTC, becoming one of the largest hodlers in the market. Microstrategy has become synonymous with institutional BTC […]

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BTC Balance Sheets: 42 Companies Hold 1.3 Million Bitcoin Worth More Than $65 Billion

BTC Balance Sheets: 42 Companies Hold 1.3 Million Bitcoin Worth More Than $65 BillionSince the company Microstrategy shifted a lot of its treasury reserves into bitcoin, a great number of companies have followed the firm’s lead. According to the web portal, bitcointreasuries.org, data shows that 42 companies are now represented on the list and the businesses hold more than $65 billion worth of bitcoin. The Corporate Bitcoin Stash- […]
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