Bitcoin (BTC) fell to its lowest price in over 12 months on Wednesday amid a broader cryptocurrency market sell-off.
According to CoinDesk price data, as of press time, bitcoin’s lowest point in today’s session is $5,669 – the lowest reported price figure since Nov. 11 of last year. Wednesday’s session opened at $6,297.96.
Its price has since slightly recovered, now trading at an average price of about $5,804.54, representing a roughly 7.9 percent decline over the past 24-hours.
The sharp fall in bitcoin’s price was accompanied by steep sell-offs in other cryptocurrencies and digital assets as well.
According to data published by OnChainFX, tokens such as MANA and BAT and DNT are down in excess of 20 percent in the past 24 hours.
In total, the capitalization of the entire cryptocurrency market lost as much as $24 billion in value over the last 24 hours, registering at $190 billion as of press time, according to CoinMarketCap.
Amusement park ride image via Shutterstock
Disclosure: The author holds BTC, AST, REQ, OMG, FUEL, 1st and AMP at the time of writing.
The crypto market took a turn for the worse on Wednesday when it lost nearly $30 billion in total market capitalization – but not every asset struggled to find buyers.
In fact, certain stablecoins like USD-C, TUSD and DAI each witnessed a more than 200 percent increase in 24-hour trading volume amid the broader market sell-off as traders flocked to what they may have perceived to be safer alternatives in an effort to escape market volatility.
The surge in stablecoin trading volume isn’t exactly surprising, given their main use case is to provide cryptocurrency users with the ability to convert volatile crypto positions into anti-fragile or ‘stable’ alternatives.
Due to regulatory constraints, USD or other fiat currencies are not readily available on most exchanges, thereby leaving stablecoins as an option.
For much of the history of the cryptocurrency market, one stablecoin – Tether (USDT) – has ruled the roost but this past year welcomed several more competitors like USD-C, PAX and GUSD, just to name a few.
Bitcoin’s breakage of the psychological support level of $6,000 on Nov. 14 was enough of a shock to turn the broader market risk-averse, which turned out to be the ultimate test for the younger stablecoins as it revealed which are becoming the most preferred – particularly during times of extreme market volatility.
Best performers
The graph below depicts the increase in 24-hour trade volume of the six largest USD-pegged stablecoins by market capitalization from before the market dump, early Nov.14, to after on Nov. 15.
USD Coin (USD-C), the regulated stablecoin backed by blockchain startups Circle and Coinbase, is the newest of the bunch yet witnessed the most notable uptick amid the market rout.
USD-C’s 24-hour trading volume surged nearly 400 percent from just over $5 million on the morning of Nov 14 to more than of $25 million by the next day, representing its highest level of volume in a 24-hour window to date.
The token’s performance also pushed it into the world’s 50 largest cryptocurrencies by market capitalization, according to CoinMarketCap.
It’s also worth noting the largest cryptocurrency exchange by adjusted volume, Binance, announced it will be listing USD-C this week, so its soon-to-increase availability could be a factor in making it a more attractive option to buyers.
The worst performer of the bunch in terms of 24-hour volume increase was the Paxos Standard Dollar (PAX). That said, PAX’s volume increased 50 percent from $45 million to $75 million within the time period.
The Gemini Dollar (GUSD) saw the least trading volume over the span, with a trade flow of $2 million and $3.5 million on Nov. 14 and 15, respectively.
USDT is still king
Although Tether was just the 4th best performer in terms of percent volume increase, its share of the trading volume in the six-member stablecoin market went largely unchanged between the start and conclusion of this week’s sell-off.
Those market-share changes are reflected in the table below:
According to data from CoinMarketCap, USDT’s 24-hour volume was 97 percent of the $2.6 billion in total stablecoin volume on November 14th.
Further, USDT held its ground on that front, seeing 96.9 percent of that volume the next day, when the total surged more than 100 percent to $5.5 billion.
Tether even began to lose its dollar-parity during the market sell-off – falling as low as $0.95 on the Kraken exchange – yet the closest competitor to USDT in terms of volume market share was PAX, at just 1 percent of the total stablecoin volume on Nov. 15.
CoinMarketCap data further reveals that USDT is tradeable on 400 cryptocurrency markets while PAX is available on just 35 – so by that measure, it’s not exactly a fair fight when considering USDT’s overall reach.
Disclosure: The author holds BTC, AST, REQ, OMG, FUEL, 1st and AMP at the time of writing.
Balloons image via Shutterstock; graph data via CoinMarketCap
Bitcoin sank to its lowest price in over a year on Wednesday, with the prices of other major cryptocurrencies falling alongside it.
As of press time, bitcoin is trading at $5,525.92 – a more than 12 percent decline on the day – in the latest sign that volatility around the world’s largest cryptocurrency by market capitalization has returned with a vengeance.
Indeed, bitcoin’s collective market cap dropped below the $100 billion level for the first time since November 12 of last year, according to CoinDesk’s Crypto-Economics Explorer (CEX).
In the past 12-hours alone, the total capitalization of the cryptocurrency market fell from roughly $210 billion to where it stands now, $180 billion. Today’s 15 percent depreciation has led the market to its lowest value since Oct. 31 of last year, CoinMarketCap data reveals.
Other major cryptocurrencies are reporting declines in excess of 10 percent on the day, including ETH, XRP and bitcoin cash – the latter of which is gearing up for a contentious hard fork on Nov. 15.
Notably, market data indicates that in light of today’s market drop, XRP (as of the time of this writing) has the second-largest market capitalization for cryptocurrencies, surpassing ETH.
USDT, the stablecoin known more commonly as tether, saw a notable drop in its price to a low of $0.95 on crypto exchange Kraken, which offers one of the few trading pairs of the token against the U.S. dollar.
Tether, among other stablecoins, is intended to hold parity against the U.S. dollar, and data from CoinMarketCap shows that the token is trading in the $0.96-$0.97 range.
Because of the dip in USDT, the BTC premium on exchanges like Bitfinex, which trades against USDT, has risen to over $300. In other words, a single unit of bitcoin can now be purchased for $5,557 on Coinbase (a regulated exchange trading against USD) while the same unit costs $5,870 USDT on Bitfinex.
Disclosure: The author holds BTC, AST, REQ, OMG, FUEL, 1st and AMP at the time of writing.
Bear-gold-bitcoin-cryptocurrency-mouth-on image via Shutterstock; Graph via CoinMarketCap
Early trading indicates crypto investors may no longer believe Bitcoin ABC, today the dominant software used to run the bitcoin cash blockchain, will hold on to its leading position following an expected fork tomorrow.
At press time, exchange markets set up in advance to offer traders a choice between Bitcoin ABC and its expected challenger, Bitcoin SV, show Bitcoin ABC has lost its early edge. After trading for more than $300 above the price of Bitcoin SV, data shows Bitcoin ABC, represented by the ticker symbol BCHABC, is now nearly trading at parity.
Data shows coins on a hypothetical BCHABC blockchain are now trading at $253, while those on a BCHSV blockchain are priced at $216, according to Poloniex.
At 9:00 UTC, BCHSV was even briefly the price leader, a significant development considering the price of BCHABC was 10 times higher than BCHSV on Nov. 9th, when they were trading at $540 and $55 respectively.
In fact, BCHABC was able to maintain a price nearly four times higher up until yesterday, when BCHSV’s investor interest started to significantly increase.
BCHSV has amassed nearly double the 24-hour trading volume as BCHABC on Poloniex, registering over $3 million in volume while BCHABC is recording just $1.23 million.
All of this follows the decision by popular cryptocurrency exchange, Poloniex to launch an experimental market they termed ‘pre-fork trading’ where placeholder token for BCHABC and BCHSV could be traded in order to allow the community to decide which blockchain it will support.
Bitfinex launched a similar market yesterday, which introduced Chain Split Tokens (CSTs) that allow traders to trade tokens representing value on each of the competing blockchains that could result from tomorrow’s fork.
Mining moves
A key drive of this change is that more mining pool operators are supporting Bitcoin SV, meaning that its blockchain could have more dedicated computing power securing transactions.
As seen on CoinDance, the two major mining pools in support of Bitcoin SV – SVPool and CoinGeek – currently hold roughly 60 percent of the total hash power now dedicated to bitcoin cash. Plus, other mining pools that support Bitcoin SV bring the total hash power towards that implementation to a little over 78 percent.
This number is up from 76 percent yesterday and 73.6 percent earlier in the week.
The numbers suggest those supporting Bitcoin SV could even have enough computing power so as to launch attacks on a Bitcoin ABC, should a minority of computers continue to support that network. Such a move has been suggested by Bitcoin SV project leaders, including Craig Wright, the Australian cryptographer who claims to be Satoshi Nakamoto and who is leading development of Bitcoin SV.
That being said, Peter Rizun, chief scientist at Bitcoin Unlimited, another implementation for bitcoin cash, believes the hash power numbers may look different after the hard fork is actually activated and those dedicating computing power to the network are forced to actually allocate resources.
Rizun told CoinDesk:
Disclosure: The author holds BTC, AST, REQ, OMG, FUEL, 1st and AMP at the time of writing.
bitcoin fork image via Shutterstock
New data is offering insight into how crypto traders are pricing in a coming technical update to bitcoin cash, one that could cause the world’s fourth most valuable blockchain to split into two competing networks.
At press time, there are now almost twice as many open short positions betting that the price of bitcoin cash (BCH) will fall as there are longs betting its price will rise. According to data from crypto exchange Bitfinex, which allows margin trading for multiple cryptocurrencies, there are currently 89,457 open BCH short positions and 53,322 open longs.
That so much market activity is taking place is perhaps no coincidence, since there is a network update scheduled for bitcoin cash set to take place on Nov. 15. Under one possible outcome, BCH will split into two cryptocurrencies – one centered around the Bitcoin ABC software, the other around the Bitcoin SV version of the software – resulting in two distinct versions of the code.
(Traders who own bitcoin cash, in such a scenario, would then hold value on both blockchains.)
Still, while more margin traders believe in the possibility of a price decline, there’s strong sentiment on both sides. BCH longs and shorts both reached all-time highs in the last 24 hours.
Short and long positions began to pile up on Nov. 2 when exchanges like Binance and Coinbaseannounced support for the upcoming fork. From Nov. 2-7, the price of Bitcoin Cash spiked over 50 percent to reach a two-month high of $646 on Bitfinex.
Surges in price are usually met with a rise in short positions since the more significant the ascent in price, the more likely a pullback tends to become. In this case, the recent surge in price combined with the upcoming fork created a perfect storm for a bearish trading environment.
It’s likely many traders brought up BCH in anticipation of the fork purely in order to receive “free” coins that could arise from one scenario. Once the fork occurs, the recent purchasers of BCH could simply sell BCH and either keep or sell the forks in order secure a profit.
As can be seen by the skyrocket in short positions, the market finds a “post-fork” sell-off to be the most likely outcome.
However, the abundance of shorts may put bears at risk of a short squeeze should the price rise above its recent high. If the price of an asset begins to rise to the point of a short no longer being profitable, those shorting will likely be caused to close, or cover, their position in order to avoid taking a further loss.
The act of closing an abundance of shorts can have a bullish impact on the market and cause a rapid price increase, known as a short squeeze, since the only way to close a short is to buy back the underlying asset.
Since longs are also at all-time highs though, a long squeeze is also a possibility if prices continue to dip. Closing a long requires the selling of the asset which can have a bearish effect on its price if the closing is done in abundance.
While its just speculation at this point, one thing is for certain, all eyes will be on Bitcoin Cash on November 15.
Disclosure: The author holds BTC, AST, REQ, OMG, FUEL, 1st and AMP at the time of writing.
Bear image via Shutterstock
New Economy Movement (NEM) hit a nine-week price high on Monday despite a neutrally toned cryptocurrency market.
That market development coincided with a more than three-month high in 24-hour trading volume the same day, according to data collected by CoinDesk. The world’s 17th largest cryptocurrency by market capitalization rose to $0.114 at 09:15 UTC – its highest price since Sept. 5, while accumulating more than $45.6 million in 24-hour trading volume. That latter figure represents the most volume since July 29, according to CoinMarketCap.
It’s worth noting that NEM’s price jumped to a peak 25 percent amid news that trading of the token is being re-enabled on Tokyo-based cryptocurrency exchange Coincheck for the first time since 500 million NEM tokens were stolen from Coincheck’s digital wallets on On Jan. 26th, 2018.
The price of NEM began to spike at approximately 8:15 UTC, roughly 45 minutes before Coincheck posted a public announcement regarding the re-enabled trading at 9:01 UTC.
NEM was last seen at an average price across exchanges of $0.107, up more than 16 percent on the day.
Further, NEM’s market capitalization reached $1.02 billion earlier today – its highest value since September 5th.
Other major cryptocurrencies are printing modest gains with seven of the ten largest by market capitalization reporting positive 24-hour price developments. Names like Monero (XMR) and XRP (XRP) are currently up over 3 percent while the world’s largest cryptocurrency, bitcoin (BTC), is up just 0.41 percent on a 24-hour basis.
The total capitalization of the cryptocurrency market now stands at $213.4 billion.
Disclosure: The author holds BTC, AST, REQ, OMG, FUEL, 1st and AMP at the time of writing.
roller coaster image via Shutterstock
Market capitalization gets a lot flack for being a poor metric to measure the value of a cryptocurrency – and perhaps rightly so – but that shouldn’t stop traders from using it as a tool to generate a market bias.
To summarize: the market capitalization of a cryptocurrency is a function of market price multiplied by the circulating supply, so its fluctuating value ends up visually mimicking that of price action when plotted on a price chart. And if it mimics price action, then technical analysis – the study of market behavior via price movement – can be applied to it just as if the price chart for bitcoin (BTC) was being analyzed.
It’s no secret that cryptocurrencies are highly speculative assets that all bank on the widespread adoption of blockchain and distributed ledger technology (DLT). Since the entire market is so reliant on the success of this factor, it’s rare for the trends of individual cryptocurrencies to deviate too far from one another for too long.
In other words, they are highly correlated, so if one cryptocurrency goes up or down in price, the others are soon likely to follow.
For the swing trader or long-term investor who does not care about intraday price fluctuations, charting the total market capitalization of all cryptocurrencies or just alternative cryptocurrencies (altcoins) can be an insightful way to analyze the long-term trend or bias of the broader market.
As it turns out, the total capitalization of the altcoin market is at an interesting technical juncture that could soon lead to another boom or bust for the market, which is further analyzed below through the use of technical analysis.
Weekly Chart
If we perform a simple technical analysis of the total capitalization of the altcoin market and connect the two major peaks in 2018, a long-term diagonal downtrend line is created.
In technical analysis, breaking a trendline to the upside is a bullish indication and hints the overarching trend is beginning change. The longer-term the trendline, though, the harder it is to break.
As can be seen in the above weekly chart, the capitalization came very close to touching the trendline but has since pulled back, as indicated by the visible upper wick.
Looking at weekly candlesticks from January and May, another rejection from the trendline could lead to a significant sell-off, whereas a weekly close above the trendline would suggest the long-term trend of the altcoin market is beginning to shift from bearish to bullish.
Daily Chart
While the weekly chart displays a major resistance hurdle that needs to break for a longer-term market trend reversal to take place, the daily chart reveals a nearer-term perspective on the outlook of the market, which has its own obstacles.
The pattern highlighted in the above chart is known as an inverse head and shoulders pattern which is a common ‘bottom’ or reversal pattern.
The pattern is comprised of three successive troughs, with the first and the third being similar in width and depth yet more shallow than the middle trough, known as the head.
In order for the reversal to take effect, the market capitalization would need to find acceptance above the neckline that was created by connecting the peaks on either side of the head with a trendline.
If successful, the depth of the head can be added to the breakout point to set a potential target. The depth of the head here is $34 billion, so if we add that to an anticipated breakout point, the market would have the potential for a 31 percent increase towards $141 billion in the not too distance future.
The Fibonacci retracement levels could be used as intermediate resistance levels, the nearest of which is the 0.382 retracement near $114 billion.
View
- The chart for market capitalization mimics that of price action and can be used to provide a broad perspective on the entire market.
- Finding acceptance above the inverse head and shoulder neckline would create a mid-term target for $141 billion, whereas breaking the weekly downtrend would suggest a longer-term bearish to a bullish trend change.
- Another rejection from the weekly downtrend would increase the chance of a broader market sell-off.
Disclosure: The author holds BTC, AST, REQ, OMG, FUEL, 1st and AMP at the time of writing.
Chart image via Shutterstock
The price of browser startup Brave’s Basic Attention Token (BAT) fell by as much as 20 percent in the past 24 hours.
Trading for BAT officially went live yesterday on Coinbase, the largest cryptocurrency exchange in the U.S., a move that followed the token’s inclusion on Coinbase’s professional platform.
Coinbase initially teased the idea of listing BAT among four other cryptocurrencies on July 13, triggering a 27 percent jump in its price at the time. BAT was able to reach a 3-month high of $0.45 just 11 days later.
Yet as of press time, BAT is trading at around $0.30, representing a 23 percent decline from than yesterday’s high of $0.39.
BAT/USD Daily chart
As can be seen in the above chart, the price of BAT broke above its upper Bollinger Band and hit a three-month high of $0.39 following the Coinbase listing news, though it quickly retreated.
In technical analysis, a price extending above its Bollinger Band is usually a sign of overextension. When combined with an overbought relative strength index (RSI), a pullback becomes more likely as a result.
Given yesterday’s bearish candle close, it’s possible that BAT’s descent is not complete. The middle of the Bollinger Band – known as the basis (middle red-line) – can now be looked to for short-term support.
Falling below the basis would set scope for a further drop to the bottom Bollinger Band where support confluence with the 0.618 Fibonacci lies near $0.22.
Selling the news?
It’s worth noting BAT’s bearish reaction from the market, following its listing on Coinbase, is not the first time a similar situation has taken place.
ZRX and ETC were two other cryptocurrencies added to the exchange this year that were met with initial investor enthusiasm but fell shortly after their official listing on the exchange.
ZRX became the most recent addition to Coinbase when it was listed on October 16th. Its price rose to an 8-week high of $1.09 the next day, but it began a steep descent thereafter.
Today, ZRX is trading at a price of $0.72 on the Binance exchange, representing a 33 percent drop from its post-Coinbase listing high.
In the frame below, the price action of ETC tells a similar story. The cryptocurrency hit a high of $15.09 on Aug.16, the day of its listing on Coinbase, but just a week later it was trading at a 20 percent lower price. Today, ETC is trading on Binance at a price of about $9.55, marking a 37 percent drop from its Aug. 16 high.
View:
- BAT looks to be another victim of the “buy the rumor, sell the news” trading strategy following its listing on Coinbase.
- Yesterday’s bearish daily close hints at a further pullback in the coming days towards the Bollinger Band basis line where it may find temporary support, currently located at $0.28.
- Finding acceptance below the basis would set scope for a drop to the bottom band where the 0.618 Fibonacci retracement lies near $0.22.
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