Big Uptick in 1k BTC Addresses Shows Institutions Bought the Dip

Big Uptick in 1k BTC Addresses Shows Institutions Bought the Dip; Goldman Sachs says Still Just 1% of Institutional Money

Despite the healthy pullback, more correction cannot be ruled out yet but $30k will be protected because many institutional investors bought around this level.

Bitcoin is taking a breather and hovering around $35,000 after the deep pullback earlier this week. This profit-taking at an ATH of $42,000 was expected after Bitcoin rallied more than 1,000% from the March 2020 lows.

“There’s signs that retail investors are taking profit,” said Ryan Rabaglia, OSL’s global head of trading. “Heightened volatility is often correlated with an uptick in retail participation.”

The market is particularly focusing on the US Dollar Index right now, which has been gaining strength, currently hovering around 90.

“We think a pullback is healthy,” said David Grider, the digital strategist at Fundstrat Global Advisors. According to him, the recent price action doesn’t indicate that Bitcoin has topped out.

However, further losses can’t be ruled out either, with miners continuing their selling while no significant stablecoin inflows in the picture. No outflows are seen from Coinbase either; as a matter of fact, BTC is flowing into exchanges.

On the basis of this, “We might have second dumping,” said Ki Young Ju, CEO of data provider CryptoQuant.

Still, $30k will be protected, and in the event of a dip, we might not go down below $28k because “there are many institutional investors who bought BTC at the 30-32k level,” Young Ju added.

These institutions were actually into buying the dips that came on Sunday and Monday. The large amounts of BTC holders that can be seen as a proxy for institutional adoption “increased significantly” since the start of 2021. This jump in address with at least 1,000 BTC shows that this institutional adoption is here to stay.

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However, according to Goldman Sachs’ Jeff Currie, the level of institutional investment in the market is still very small though “the market is beginning to become more mature.”

“The key to creating some type of stability in the market is to see an increase in the participation of institutional investors, and right now they’re small,” said the investment bank’s head of commodities research on CNBC., adding that the investment in BTC is, “roughly 1% of it is institutional money.”

While for institutions, Bitcoin is a hedge against fiat debasement and risk of inflation, as it emerges as a store of value, for some, it is a way to fix economic injustice as well.

“For the first time in history, we have a Plan B option to the current financial system which has seen years of redlining, racial discrimination and other egregious acts by retail banks to the Black community,” said Isaiah Jackson, author of “Bitcoin & Black America.”

According to him, Bitcoin gives Black people an opportunity to not only shift their money but also their mindset because the world’s leading digital currency is unconfiscatable and has no barrier to entry.

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Author: AnTy

Big US Banks Set Aside Billions in Downturn Warning; Stocks Continue to Tumble

The markets started to see red as investors grew worried about an uptick in coronavirus infections slowing the economic recovery when they kicked higher later in the day yesterday after the banks earning season kicked off.

The Dow Jones Industrial Average raced higher with its biggest percentage advance of the month. S&P 500 also spiked 1.7%, which can be further driven by a good performance by the banks’ stocks.

Bitcoin meanwhile continues to hover around $9,215 as it has been doing for about a month now. The volume remains extremely low while Tether is recording more than double the bitcoin’s ‘real’ trading volume, as per Messari.

The first earnings report showed that Wells Fargo took a $2.4 billion loss, the first quarterly loss since 2008. The earnings declined due to low-interest rates, uncertainty associated with COVID-19, and a worse-than-expected macro environment.

The surprise came in the form of JPMorgan, which topped its revenue estimated at $33 billion, up from 15% from the same quarter last year while profits dropped over 50%. Citigroup also reported revenue of $19.8 billion but a drop of 73% in profits from last year.

This was because of trading revenue driven by massive volatility in the market and the Fed injecting liquidity while purchasing corporate bonds as such, not sustainable.

Banks stocks are currently down with Wells Fargo losing as much as 45% in yearly returns. The shares of Wells Fargo and Citigroup fell 5.4% and 2.8%, respectively, yesterday with little changes in JPMorgan’s.

While both Citibank and JPMorgan Chase beat their estimated earnings, they didn’t put out an optimistic outlook.

JPMorgan CEO Jamie Dimon warned that the bank still “faces much uncertainty regarding the future path of the economy.”

All three of the banks meanwhile continue to stockpile billions; Citibank added $5.6 billion in the Q2 2020 while Wells Fargo and JPMorgan added $8.4 billion and $11 billion respectively to prepare for things to get worse.

Although government aid cushioned the economic fallout from the pandemic so far, bank executives said as the programs begin to expire in the coming months, the banks expect their losses to mount as defaults will rise.

“The banks are pessimistic about the course of the recovery,” said Gabriel Chodorow-Reich, associate professor of economics at Harvard University. “The banks don’t see a rapid recovery over the next six months — they see a protracted recession.”

Amidst this, Lael Brainard, a Federal Reserve governor, warned that “a broad second wave could reignite financial market volatility and market disruptions at a time of greater vulnerability.”

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Author: AnTy

Bitcoin is in a New Market Cycle and a “Much More Mature Position”: Circle Q2 Report

Bitcoin-is-in-a-New-Market-Cycle-and-a-Much-More-Mature-Position-Circle-Q2-Report
  • Bitcoin hash rate saw an uptick of 32% q/q while miners’ revenues register a change of 177% q/q
  • Tether dominance grew in Q2 despite being the center of controversy
  • Unlike previous cycles, this bull run has a slower cadence of institutional investors

Circle released its Q2 2019 report talking about the crypto industry growth and price of Bitcoin that rose to levels not seen since January 2018 along with the trading volumes across custodial, non-custodial exchanges and derivatives platforms.

When it comes to network activity, average daily active addresses surged for five consecutive months, up 26% quarter over quarter (q/q).

The average daily transaction had mixed monthly performance, up 187% year over year. Average daily value transacted and transaction size registered a consistent rise.

There has also been an uptick of 32% q/q in the hash rate of the Bitcoin network while miners’ revenue saw a quarter over quarter increase of 177%.

Meanwhile, Litecoin Network capacity declined 11% q/q in BTC terms.

Tether Dominance Grew in Q2 Despite Being the Center of Controversy

When It comes to stablecoins, Tether’s dominance grew this quarter despite the revelation that USDT is only 74% backed by cash and equivalents followed by an investigation into Tether and Bitfinex by NYAG. Tether also dominates on-chain volume relative to all other stablecoins.

Among stablecoins, USDC showed the greatest growth (rise 48.7% q/q in market cap) followed by USDT (46.7% q/q) while GUSD’s market cap declined 75% q/q.

Bitcoin dormancy that sheds some light on the state of Bitcoin market cycles and its long term economic growth, has been on the rise with recent price action, up 103% q/q. But it’s still down 30% YTD and not yet at 2017 levels.

High dormancy means more long term holders are selling their BTC which is a bearish indicator while low dormancy is bullish as more coins are held for a longer period.

Unlike Previous Cycles, This Bull Run Has A Slower Cadence of Institutional Investors

The report says, Bitcoin performance in 1H 2019 suggests the “starting of a new market cycle” and in a

“much mature position.”

It also points out how high-quality assets have seen “differentiated” performance and they do not see the entrance of new low-quality assets that was “pervasive” in the last bull cycle.

This bull run, it notes, unlike the previous two cycles that were driven by retail investors, this time a “longer” cycle will see a

“slower cadence of Institutional investors.”

Institutionalization has been a recurring theme for years now but now we have started to see “greater involvement” from not only existing but also new institutional investors. The market is also seeing a maturation of institutional infrastructure such as regulated exchanges, custody providers, and investment vehicles and products,

“paving the way for incumbents enter.”

Notable mentions are Grayscale that showcases continued strength and derivatives volume that spiked in line with BTC price. Futures volume on BitMEX and CME combined were $342 billion while combined options volume on Debit and LedgerX was $2.6 billion in Q2.

All of Today’s Bitcoin Price Analysis, Chart Forecasts and Industry News

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Author: AnTy