High Chances of a Bitcoin ETF Approval in 2021 as BTC Trades Like Gold

After a strong rally right at the beginning of this week, Bitcoin is now keeping around $13,000 in the second half.

While BTC has taken a breather, volume across the board and open interest are showing solid sessions.

Quant trader Qiao Wang has a hunch that “Once BTC breaks $14k, we’ll likely be in a different regime in terms of volatility, momentum, retail participation, and so on. A lot of things that worked last few months may no longer work and vice versa. $20k will take this regime to a whole new level.”

Meanwhile, bitcoin’s one-month correlation with the stock market has taken a sharp decline, while with gold, it has started to increase.

And this trading more like gold, a store of value is likely to hold as per Mike McGlone, a senior commodity strategist at Bloomberg Intelligence.

Acting Like Gold

Bitcoin has been showing signs of maturity in terms of lower volatility, trading patterns, and more adoption, similar to gold. Moreover, the macroeconomic factors driving gold price higher are likely to push BTC’s price as well, he said.

“The key thing it has been doing since it went to $100 and then to $1,000 and then $10,000, which has really been the consolidation price for the last three years, it just has a history of adding zeros,” McGlone said in an interview.

Amidst the market enjoying a rally, Bitcoin has already hit an all-time high (ATH) in the local currencies of some countries like Brazil, Argentina, Turkey, Venezuela, Sudan, Zambia, and Angola.

However, while not bearish, popular trader Loomdart isn’t bullish either as he believes the ongoing institutions’ FOMO buying narrative is “the foundation for a bitcoin” that provides support and lowers volatility. Still, it also doesn’t imply “ceaseless green days.”

Unlike Tesla, “there’s no gigantic tranche of short interest waiting to launch us to the heavens. It’s way more like gold. As long as derivatives stay muted (oi increase < market cap increase), I simply don’t think we have the fuel for a leveraged long,” he said, adding funds rotating from long to short “isn’t encouraging.”

The Next Phase

With all the maturity Bitcoin is seeing: low volatility, publicly-traded companies making it part of their Treasury, mainstream companies like PayPal supporting cryptos, and increased regulatory scrutiny, the chances of the approval of a Bitcoin ETF are seeing an increase.

“It will be challenging for the SEC to justify rejecting a well-crafted bitcoin ETF proposal in 2021, and I assume there will be many of them,” said Jake Chervinksy, General counsel at compound Finance.

Under the Administrative Procedure Act, SEC’s decision can be overturned by a court if it’s “arbitrary & capricious,” he added.

While it takes about 9 months from the date of filing to a final decision on approval, once approved, the listing can happen almost immediately. And that could also mean, much like the launch of bitcoin futures in December 2017 marked the top of that bull cycle; the bitcoin ETF approval does the same for this cycle.

Chervinksy even expects Grayscale Bitcoin Trust (GBTC) to restructure as an ETF at that point, as even the crypto asset manager has also hinted at this.

In Q3 of 2020, GBTC had yet another record inflow, for the third time in a row, with the premium still around 20%, but as the bitcoin rally intensifies, the demand for GBTC could see it surging higher yet again.

“Expect the Grayscale bitcoin premium to roar in the next few months, particularly so in H1’21, then come crashing down as market starts to price increasing odds of a bitcoin ETF approval,” said trader and economist Alex Kruger.

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Author: AnTy

Strong Institutional Demand for Bitcoin, CME Becomes Second Largest BTC Futures Market

Bitcoin’s price made a big shift this week as the bulls gained control of the market and pushed it past $13,000.

A similar shift has been seen in the open interest recorded by the bitcoin trading platforms. The biggest change has obviously been in derivatives exchange BitMEX, which has been seeing a constant decline since earlier this month when CFTC brought down criminal charges against it.

From 55k BTC OI on Oct. 1st, it fell to 28k BTC yesterday, a decline of nearly 50%.

In USD terms, the OI has dropped from $781 million in late Sept. to under $600 million, but the recent jump in BTC price helped it get back above it but barely.

Interestingly, CME enjoyed a good uptick during the same period, showcasing strong institutional demand for bitcoin.

With $790 million in OI this month, the OI on CME recorded a growth of almost 130%, from $345 million on Oct. 2nd. And this uptrend helped the regulated trading platform become the second-largest futures market for bitcoin.

“The OI on the CME BTC futures has climbed aggressively lately. CME is currently the second-largest futures market for bitcoin, holding 15.7% of the total OI in the BTC futures market. This is still slightly below CME’s record share of the total market OI from August of 16.2%,” noted Vetle Lunde, an analyst at Arcane Research.

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Another crypto exchange seeing an incremental exchange in OI is FTX, which saw an increase of just over 103% from $166 million at the beginning of this month to $337 million.

Other exchanges Deribit (+79%), Binance (+72%), ByBit (+44.5%), Kraken (+41.4%), Bitfinex (+35%), OKEx (+25%), and Huobi (+18%), all recorded an uptick as well but of small percentage compared to CME.

Unlike others, Bakkt’s 50% wasn’t sustainable, and it continues to move up and down while keeping below $18 million.

Markets are healthy, not just OI, but solid activity has been recorded across spot, futures, and options as well. The big session has been the result of PayPal announcing support for cryptocurrencies.

Also Read: ‌PayPal Exploring Acquiring Crypto Companies, Already in Talks with Bitcoin Custodian BitGo

And with this, futures are no longer in backwardation.

“Bitmex, bybit BTC futures are now higher than spot ($10-25). An interesting shift of market sentiment. People are finally starting to become bullish. But that doesn’t mean this is the top. It can take weeks or months for the top to happen. Funding rate will be the key indicator,” noted trader Crypto Squeeze.

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Author: AnTy

Bitcoin Overtakes Disney & Netflix After Beating BoA to Become 23rd Largest Asset by Market Cap

Bitcoin is enjoying a bullish this week as the price sets a new 2020 high.

As the leading digital currency surpassed $13,000 for the first time since early June 2019, Bitcoin’s market cap also jumped to $230.5 billion.

Bitcoin’s market cap is on an uptrend ever since the March sell-off, which resulted in it going under $100 billion. But now, we are on a level not seen since mid-January 2018, as per Bitinfocharts.

At the peak of the 2017 bull run in December, Bitcoin recorded a market capitalization ATH of nearly $325 billion.

If Bitcoin’s market cap breaks this high, it will put the digital asset at 16th place, replacing Mastercard based on market cap, 7 spots above its current place while beating the likes of PayPal, JPMorgan Chase, and Home Depot.

Currently, Bitcoin is at 22nd place by market cap, overtaking Coca-Cola, Netflix, Intel, Disney, Salesforce, and Verizon, as per Asset Dash.

Just before this week, Bitcoin had entered the top 30th place flipping Bank of America but this week’s gains of 16.6% thanks to PayPal announcing support for the flagship cryptocurrency has it flying. Jake Chervinksy, General Counsel at Compound Finance said,

“Bitcoin’s value has increased extraordinarily since its price last peaked in 2017. We’ve spent 3 years building mature market infrastructure, resolving regulatory issues, & gaining legitimacy & adoption in mainstream circles. Price will reflect all of this work sooner or later.”

The digital asset still has a way to go. The top spot sits Apple with a whopping over $2 trillion market cap followed by three other trillion dollar brands Microsoft, Amazon, and Alphabet.

For Bitcoin to enter into the trillion-dollar category, the price of each BTC must spike to about $54,000. And to replace Apple to become the biggest asset, Bitcoin’s price needs to jump past $100k. But as Dan Tapiero, co-founder of 10T Holdings, notes,

“It’s still so early for bitcoin. Still at the birth of a new global asset class.”

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Author: AnTy

Ethereum Exchange Reserves on a Sharp Decline While Locked ETH Continues its Uptrend

Activity on the second-largest network is thriving.

Since early this year, daily transactions on Ethereum have been growing, hitting an all-time high last month. Although it has come down some as DeFi mania cooled down, daily transactions are keeping to July-August level.

Ethereum fees have also gone back to normal levels as the DeFi rush came to an end, which in August sent average fees to $10 for the first time, bringing Ethereum’s scaling issues into glaring light.

With the upgrade coming up to keep the fees down for another potential growth spurt, it “would mean less demand for the token because people would need to buy fewer coins to do the same operations. From developers to end-users, it will largely reduce the buying pressure,” wrote analyst Mati Greenspan.

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Moreover, as per Glassnode, the popular stablecoin Tether transaction volume on Ethereum also saw a 20% spike over the past 30 days. It reached a new milestone of $600 billion.

“Tether’s important role in the digital asset ecosystem… If you were to add tether’s usage on other chains such as Tron, Omni, and Algorand, the headline figure would be higher still,” said Paolo Ardoino, CTO at Tether and its sister company crypto exchange Bitfinex.

Out of the total supply of $16 billion, USDT’s supply on Ethereum has also exceeded $10 billion, representing nearly 65% of the Tether token supply on a blockchain.

7.6% of ETH’s Total Supply Out of the Market

Amidst this growing activity, Ether’s amount on exchange wallets has been declining ever since May, as per Crypto Quant. Ethereum exchange reserves have fallen to 11.8 million ETH from the mid-May high of 14.14 million ETH.

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This trend coincides with the ETH that hasn’t been moved in over a year, which has reached 60%.

Additionally, 8.7 million of ETH are currently locked in the decentralized finance (DeFi) sector, as per DeFi Pulse.

“7.6% of ETH’s total supply is currently locked in the DeFi ecosystem. The amount of ETH locked in DeFi increased by a record high of 3.3M in September and has grown by 5.6M in 2020. That’s 2M more than the total supply of ETH has increased this year,” as per The TIE.

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The only factor lagging is Ether’s price, which is currently trading around $380, up only 188% YTD and still down 75.76% from its ATH.

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Author: AnTy

Bitcoin Miners Generating BTC at Fast Pace & ‘Running Down Inventory’ Just as Hard

Bitcoin started this week on a bullish note, reaching above $11,700 only to drop to nearly $11,200 level on Friday after crypto exchange OKEx announced that cryptocurrency withdrawals had been suspended.

According to the local media, two of the executives, including its founder, Star Xu, arrested by the police, have been released on bail. Star Xu has been reportedly assisting in the investigations.

The exchange maintained that the investigation is “not related in any way to anti-money-laundering or to OKEx,” and that the funds are safe and all other functions are unaffected.

OKEx actually holds 1.1% of Bitcoin’s circulating supply (200,000 BTC worth $2.3 billion), and before the suspension of withdrawals, large BTC outflows were observed from the exchange.

As per Glassnode, “a total of 10,000 BTC ($113 million) were withdrawn in two large batches in the past 48h.”

Market Unchanged

Yesterday, what made matters worse for the already jittery markets was the Deribit exchange that was temporarily out of action due to maintenance that had not only BTC price falling but also the futures curve flattening yet again.

On-chain analyst Willy Woo actually expects the last CME gap around $11,200 to get filled as he sees hidden distribution at spot exchanges, with volume sell-off not yet reflected in the price.

But in the near term and overall, he remains bullish, signaled by the growing market fundamentals.

“The on-chain fundamentals which are 3-6 weeks at the minimum timeframes are still unchanged in bullish mode, if we do get a pullback, I’d take it as a chance to deploy capital into BTC if you missed it in the 10k zone,” said Woo.

Still, Some Weakness in Near Term

While the network fundamentals, the hash rate has made an all-time high, miners are “running down inventory quite hard today.” With MRI currently above 100%, it means miners are selling more Bitcoin than they are mining.

This, according to Charlie Morris of ByteTree, is an indication of a “Healthy market to sell into.”

Interestingly, with more than ever hash power used to mine bitcoin, the standard 10 minute time to generate a bitcoin has fallen to 8 minutes 8 seconds, as per Bitinfocharts. In the second half of 2020, the block time has been kept between 12 to 8 minutes.

Overall, bulls haven’t lost yet, and they could further continue higher, especially if equity markets trade up given their correlation that continues to increase, currently above 57%.

“Recent BTC breakout was legit, but more effort needs to be coming from the bulls. Price action remains in a three-wave corrective move after bearish impulsion. Break of $11,740 & $12,500 Highs needs to commence, otherwise bears might try to force more consolidation/downside,” says one analyst.

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Author: AnTy

Coinbase to Sponsor Bitcoin Developers to Help the Grow & Maintain the BTC Protocol

“Excited to be supporting more Bitcoin protocol development. This is a great start, but hopefully, we can expand this program over time,” said Coinbase CEO Brian Armstrong as the exchange announced that it is sponsoring Bitcoin developers who contribute directly to the Bitcoin Core codebase or closely associated Bitcoin projects.

Coinbase has already begun its search for at least two Bitcoin development grant recipients from anywhere in the world.

“Bitcoin launched without a fundraise, while bootstrapping an entire industry, and the open-source community has provided critical support for Bitcoin development.

Our goal is to similarly support developers who are committed to growing and maintaining the Bitcoin ecosystem.”

This is yet another step from Coinbase to grow the crypto-economy, which is essential to building the open financial system.

The Crypto Community Fund aims to improve the entire crypto industry. Although it started with the leading digital currency, the company intends to expand the program to other projects if successful.

Interested people can start applying for the grant, which will be shortlisted by current Bitcoin Core developers and community members, with Coinbase making the final decision.

While the focus is on one-year-long developer grants, shorter projects are also encouraged.

Coinbase is looking to support the likes of those projects that contribute directly to Bitcoin core, Bitcoin Improvement Proposal (BIP) review, contributor tooling, Bitcoin Core libraries, and tools, or improvement to testing.

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Author: AnTy

Atari to Launch a Token to Sell its New Gaming System, VCS; First Hardware in Over 20 Years

Legendary players, Atari is all set to launch its new hardware in more than two decades. But this time, it comes with a twist of crypto.

By introducing a way for gamers to spend cryptocurrency in the play, Atari, once an incredibly popular gaming company that has fallen from grace, weathered bankruptcy, and now facing stiff competition from the likes of Microsoft’s Xbox and Sony’s Playstation, which are preparing to launch their new video-game consoles, is attempting to restore its former glory.

Atari VCS, called mini-console or a gaming computer, was first teased several years ago and is expected to ship next month; it will offer access to over 100 Atari arcade games and home classics.

In its efforts to remain relevant, Atari brings crypto into the mix by letting consumers buy products using Atari Tokens that will go on sale in late October.

The tokens will be available from Oct. 29 on Bitcoin.com Exchange, which will start selling $1 million worth of Atari Tokens to retail investors at 25 cents apiece outside of the US.

Initially, these tokens can be used for in-game purchases and partner games. Eventually, the tokens will be used in the broader gaming ecosystem if the company’s effort to create standard currency for the industry becomes a success.

Atari is reportedly working on a gaming stablecoin but isn’t any close to launching, as per Chief Executive Officer Frederic Chesnais, who led Atari out of its 2013 bankruptcy.

“We have a brand, we have a following — we think we are going to get some attention in any case,” said Chesnais, who added that the iPhone is more his competition than an Xbox or PlayStation. “After that, the product has to be good.”

The crypto push is part of Chesnais’s seven-year effort to bolster Atar SA and make it more modern and relevant.

So far, over 11,500 people have preordered the new hardware via Indiegogo, a crowdfunding site, where Atari ran the campaign and took in more than $3 million.

“We’ll see how it plays up,” Chesnais said. “We don’t need to sell millions in the beginning, it’s a long-term effort.”

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Author: AnTy

PwC: “Large Crypto Unicorns to Become Increasingly like ‘Crypto Octopuses'”

The value of the M&A’s in the cryptocurrency world saw strong growth this year as it exceeded the total of 2019 just in the first six months of 2020, according to PwC’s latest report on the crypto merger, acquisition, and fundraising landscape.

Compared to last year’s $481 million, the first half of this year recorded $597 million in global deal value as tie-ups became less frequent but bigger.

In the first half of 2020, there were 60 tie-ups versus 125 in the whole of 2019, said PwC.

However, activity continues to shift away from the US as the volume in Asia-Pacific and Europe, the Middle East, and Africa was 57% compared to 51% last year.

The biggest deal of 2020 was made by Binance Holdings, which purchased CoinMarketCap for $400 million. PwC Crypto Leader Henri Arslanian said,

“We expect crypto M&A activity to remain strong for the coming months particularly with some of the larger or more profitable players acquiring firms that offer ancillary services to their current offerings.”

“We should expect the large crypto unicorns to become increasingly like ‘crypto octopuses’ by acquiring or investing in various ancillary businesses in order to remain dominant.”

Digital asset manager CoinShares also anticipates the materialization of a “more robust M&A market” but says significant industry consolidation is likely to come first to clean up the market fragmentation.

According to them, crypto companies need to demonstrate the ability to generate recurring revenue and stable cash flow, consistent delivery on growth metrics, low margin volatility and above-average margins, low revenue concentrations, and low founder involvement.

According to PwC, the first of the year also saw a spike in fundraising involving trading companies or cryptocurrency exchanges, which has been attributed to the rising digital asset prices, greater regulatory clarity, and increased institutional interest.

2020 saw legendary investor Paul Tudor Jones putting money in crypto, boosting demand from bigger players and MicroStrategy and Square making bitcoin a part of their Treasury.

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Author: AnTy

Bitcoin On The Way to $12,000 as US Dollar Moves Down

After ending the market on a high note last week, this new week is seeing another good start.

What started as a not so pleasant Monday with Bitcoin losing about $200 turned out to be a green one with the digital asset going for $11,550.

“Some technical overhead resistance right now and a CME gap below at 11.1k, pretty low risk in buying the dip if it comes,” says on-chain analyst Willy Woo.

The price now has resistance coming at $13,000-$14,000 with trader Josh Rager seeing $12k real soon.

“Price is back up in previous range prior to breakdown, and personally, I don’t see why we can’t see $12k this week,” said Rager.

Square’s $50 million Bitcoin investment caused the price increase to prevent institutional investors from placing long positions as of yet.

While asset manager accounts long positions on CME went up from 523 to 703, Leveraged funds and other reportable positions accounts didn’t show a direction adjustment indicating a conservative approach, as per CME’s latest report, as of Oct. 6.

Open interest also rebounded from 7,324 to 7,511, after a two week contraction period.

The Longest Run

The good thing for bitcoin is despite a slew of regulatory moves like the UK FCA banning the sale of crypto derivatives and the DOJ issuing a crypto enforcement framework, Bitcoin held to $10,000 strong.

As a matter of fact, it has now been a total of 90 days, so far in 2020 that bitcoin has been above $10k compared to 86 in 2019, 53 in 2018, and 34 in 2017.

According to Fundstrat Global Advisors LLC, regulatory clarity is good for crypto as it would clean up “bad actors.” “Despite select smaller pockets of risk,” they see it as a positive for the overall market, adding, “we believe the prevailing bull market trend is intact.”

But they do see DeFi “coming under pressure” for lack of KYC and AML protocols along with offshore quasi-equity exchange tokens and further risks with “crypto tokens exclusively listed on offshore exchanges where stricter U.S. investor prohibitions could limit liquidity and demand.”

Derisk Mode Still on

Unlike BTC, gold is seeing no such spike, trading at $1,924, the same as S&P 500 at just above 3,500. The US Dollar, however, has declined to 93, which is in strong negative correction to bitcoin.

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The general market remains in de-risking mode ahead of the US Presidential election on Nov. 3rd.

However, investors are growing more hopeful of additional economic stimulus as President Donald Trump said that he wants to see a bigger stimulus package than either Democrats or Republicans were offering.

While Trump made a reversal from earlier last week’s threat to halt negotiations, Senate Majority leader Mitch McConnell expressed doubt that Congress would pass a package before the election.

According to Goldman’s chief equity strategist David Kostin “new information on the election, vaccines, and upcoming 3Q earnings represent substantial cross-currents for equities during the next two months.”

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Author: AnTy

LibertyX Confirms Bitcoin ATMs at Tesla Gigafactory’s; Elon Musk Questions the ‘Accuracy’

It now appears there is actually a Bitcoin ATM at the Tesla Gigafactory based in Nevada; this is despite Tesla founder Elon Musk downplaying the existence of one, following a tweet by Fold CEO Will Reeves, who claimed to have sighted the ATM over the weekend. The tweet also featured google map images, which reveal that the ATM sits close to the mega facility’s North-East section.

Finbold, which also reported on this news yesterday, seems to have gotten some insights on who might have installed the Bitcoin ATM. According to its Sunday report, speculations were that Bitcoin ATM maker, LibertyX, is the company behind these developments at Tesla. In a follow-up of the same, Finbold has since received a confirmation from the LibertyX team that they are responsible for the upgrade.

LibertyX was keen to highlight that it did not install new machines but upgraded the software of three ATMs in the factory to integrate a Bitcoin selling feature. The firm, which already has 5,000 live ATMs, plans to scale this to over 100,000 in the near future; its ATM manufacturing partners are Hyosung and Genmega. LibertyX also confirmed that the Bitcoin ATMs at Tesla has been live since August and can only be accessed by employees,

“The Tesla locations have been live since August. The ATM is currently only accessible for employees.”

While the Tesla founder is not much of a Bitcoin bull-like Twitter and Square CEO Jack Dorsey, he has previously sighted that he owns .25 BTC sent to him by a friend back in the day. In fact, LibertyX is hopeful that Musk will increase his BTC portfolio size with newly integrated Bitcoin ATMs at Tesla’s Gigafactory,

“Elon, 0.25 BTC isn’t enough, and now that you can buy bitcoin from the 3 on-site Gigafactory ATMs, you don’t even need to leave home.”

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Author: Edwin Munyui