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Bitcoin Price Consolidates After Steep Loss as Market Cap Holds Below $100 Billion

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Bitcoin’s market capitalization remains firmly capped below $100 billion on Friday, as prices struggled to regain momentum following a catastrophic selloff earlier in the week. Although bitcoin remains firmly in the grip of the bears, price action over the last 24 hours suggests the worst of the downshift had passed.

BTC/USD Update

The bitcoin price is currently trading at $5,555.00 on Coinbase, having gained 2.6% over the previous 24 hours. The leading digital currency is still trading at a premium on Bitfinex, though the price spread has narrowed to around $120. BTC printed a low of $5,530.90 on Bitfinex but has since recovered near $5,674.

Aggregate pricing data provided by CoinMarketCap show a 24-hour return of 2.3% for BTC. Based on those metrics, the digital currency is averaging a price-per-coin of $5,616. That gives bitcoin a total market capitalization of $97.6 billion, down from $111 billion earlier in the week.

Bitcoin suffered a double-digit loss on Wednesday, with prices eventually piercing below $5,200 in the following session. That marked the lowest level in well over a year. At the same time, the broader cryptocurrency market plummeted to a low of around $176 billion as altcoins and tokens lost nearly $30 billion in value in less than two days.

At the time of writing, the combined crypto market cap had recovered to around $184.8 billion, though trade volumes had declined by roughly a quarter to $18.8 billion.

Virtual currency exchanges processed more than $6.3 billion worth of bitcoin trades in the last 24 hours. BitMEX, a leading derivatives platform, processed a whopping 29.3% of all bitcoin trades. No other exchange even came close in terms of daily turnover.

Recovery Likely

Bitcoin’s steep and sudden reversal followed a period of unprecedented calm for the virtual currency. As of Monday, bitcoin’s volatility index had fallen to the lowest level in over two years. The 30-day volatility index has since more than doubled to 2.15%, according to bitvol.info.

The sudden rush to liquidate BTC and other crypto holdings occurred on the eve of the bitcoin cash hard fork. The fork, which was initiated Thursday, has divided the bitcoin cash community into two camps with an ensuing tug of war over hash rate and user support. At the time of writing, the bitcoin ABC implementation was in the lead in terms of blocs mined.

Bitcoin’s massive decline, which has pushed prices deeply into oversold levels, is likely to be scooped up by bargain hunters in the coming days. The means a return to $6,000 – a level commonly associated with mining costs – shouldn’t be ruled out. If history is any indication, the market has a vested interest in keeping prices above that level.

Disclaimer: The author owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.

Featured image courtesy of Shutterstock.

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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4.6 stars on average, based on 701 rated postsSam Bourgi is Chief Editor to Hacked.com, where he leads content development for one of the world's foremost cryptocurrency resources. Over the past eight years Sam has authored more than 10,000 articles and over 40 whitepapers in the fields of labor market economics, emerging technologies, cryptocurrency and traditional finance. Sam's work has been featured in and cited by some of the world's leading newscasts, including Barron's, CBOE and Forbes. Contact: sam@hacked.com Twitter: @hsbourgi




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Bitcoin

Minor Bounce Lifts Bitcoin Price Back Above $3,200; Waves Making Big Moves

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Cryptocurrencies levitated off yearly lows Sunday, with Litecoin and bitcoin SV emerging the biggest winners following an early weekend retreat. Another shake-up in the top-20 suggests 2019 will be a pivotal year for altcoins and tokens, which have struggled to remain relevant in the face of increasing bitcoin dominance and declining interest among retail investors.

Bitcoin Recovers

The leading digital currency experienced a modest relief rally on Sunday after setting a new yearly low the previous morning. BTC is currently valued at $3,266, having gained 2% on the day. The price peaked just above $3,305 earlier in the session.

Trading in BTC on virtual currency exchanges has declined sharply over the weekend; on Sunday, total daily turnover reached $3.8 billion, according to CoinMarketCap. Spot trading as a share of overall market activity rose to more than 80% with BTC/USDT, ETH/USD and BTC/KRW the most dominant pairs.

With a market cap of nearly $57 billion, bitcoin exerts a strong gravitational pull on altcoins and tokens. Bitcoin’s share of the overall market cap, now at 55%, has risen steadily during the latest leg of the bear market.

Bitcoin SV Leads Rally

In terms of best individual performers, bitcoin SV launched an 18% gain on Sunday as the protocol’s backers remained committed to achieving market dominance in the long term. Craig Steven Wright, one of SV’s most prominent backers, says he’s in it for the long haul in the wake of last month’s hard fork. This comes despite overwhelming support for bitcoin cash ABC, the primary implementation of the BCH hard fork.

Wright appears no longer keen on attacking the competing protocol but will instead focus on brand and business development to attract new users.

In its short history, SV has demonstrated an ability to move inversely with the broader market. This has allowed it to quickly scale the market cap rankings but also fall just as quickly. On Sunday, the coin was worth $77.50 for a total value of nearly $1.4 billion.

Waves Skyrockets

Waves coin briefly cracked the top-20, adding to a string of gains since the end of November that have set the digital currency apart from its peers. At the time of writing, Waves had slipped back to 22nd place with a value of $2.47 and a market cap of $247.4 million. Astonishingly, the cryptocurrency has gained nearly 160% since Nov. 25. Over the same stretch, the broader cryptocurrency market fell by 13%.

As a token customization platform, Waves operates its own decentralized exchange where new tokens can trade alongside major cryptocurrencies like bitcoin and Litecoin. At last check, the decentralized exchange had 69 crypto listings and over 20,000 custom tokens.

CCN reported a 50% surge in Waves coin last week following a mobile wallet upgrade that allows users to buy cryptocurrency with credit cards. This may have contributed to the rise of trading volume in Waves coin.

Disclaimer: The author owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.

Featured image courtesy of Shutterstock.

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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4.6 stars on average, based on 701 rated postsSam Bourgi is Chief Editor to Hacked.com, where he leads content development for one of the world's foremost cryptocurrency resources. Over the past eight years Sam has authored more than 10,000 articles and over 40 whitepapers in the fields of labor market economics, emerging technologies, cryptocurrency and traditional finance. Sam's work has been featured in and cited by some of the world's leading newscasts, including Barron's, CBOE and Forbes. Contact: sam@hacked.com Twitter: @hsbourgi




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Bitcoin

Mainstream Adoption of Bitcoin Will Send Price Soaring

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The pain inflicted by the crypto markets has been extreme this year.  It’s become clear that the market ran way too high, way too fast in 2017.  Many traders knew a severe correction was forthcoming, but I doubt many predicted the correction (now a full-fledged bear market) would be this extreme.  While the markets have been painful, Bitcoin (BTC) serves a bigger purpose than just making money in the markets.  To some, that purpose is a worldwide digital currency that can eventually be used to purchase anything.  To others, the purpose is a store of value to prevent against the inflation that plagues FIAT currencies.  Either way, it’s important to remember that this is just the beginning.

Early Phase of Adoption

Bitcoin is still in the very, very early phase of adoption.  Let’s look at the graph below.

The technology adoption life cycle is a sociological model that describes the adoption or acceptance of a new product or innovation, according to the demographic and psychological characteristics of defined adopter groups.

Many consumers still have no idea what Bitcoin is.  When people google the term Bitcoin, they are likely to get the following definition:  Bitcoin is a digital currency that is not backed by any country’s central bank or government.  Bitcoins can be traded for goods or services with select vendors.  But the truth is that Bitcoin can’t be used to buy things that would be useful for most people.   Consumers can’t use Bitcoin to buy groceries, pay the cable bill, pay for medical expenses, buy a car, or purchase a home.  For years, Expedia (one of the world’s largest travel booking engines) allowed consumers to use Bitcoin to make hotel reservations.  But even that was taken away in June.

Clearly, Bitcoin has yet to achieve its intended goal.  Based on the graph above, I can confidently claim that Bitcoin is still in the innovators phase.  In fact, one big innovation in the future may help push Bitcoin into the early adoption phase.

Lightning Network

Although Bitcoin took the world by storm in 2017, one big problem has always loomed large; scalability.  The ability to scale to the required size was a concern when Bitcoin was first introduced to the world and it remains a problem that needs to be addressed.  What does scalability entail?  Well, let’s look at the visual below.

At present, Bitcoin is only capable of processing approximately 7 transactions per second.  Compared to PayPal, Ripple, and especially Visa, Bitcoin needs to improve dramatically.  One way that Bitcoin may be able to perform significantly better is through the lightning network.

It’s currently estimated that the lightning network will have the potential to process 1 million transactions per second.  While that sounds great on paper, it’s still just theoretical.  Once the network becomes operational, its true greatness will be determined.

Conclusion

Although Bitcoin has had a rough 2018, it’s important to recognize that the future still burns bright.  Bitcoin is still in the innovators phase of adoption.  And while the lightning network is set to address Bitcoin’s biggest hurdle, better days are ahead.

Disclaimer: The author owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.

Featured image courtesy of Shutterstock.

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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Bitcoin

Bitcoin Price Unable to Break Downward Spiral as Speculation Drives Market

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Bitcoin’s price touched new yearly lows on Saturday, as the broader cryptocurrency market risked further capitulation in the days and weeks ahead. According to the CEO of BitPay, bitcoin’s price is driven predominantly by speculation regarding future adoption and is less concerned with current market forces. If that’s the case, there’s a reasonable case to be made for a strong rally in the new year.

BTC/USD Update

The bitcoin price reached a low of $3,130 on Coinbase in early-morning trade, the lowest since August 2017. The U.S.-based exchange last quoted BTC/USD at $3,147. Exchanges Bitstamp, Bittrex and Gemini show similar levels, while Bitfinex maintained a $100 premium.

Market-wide data provided by CoinMarketCap show an average bitcoin price of $3,207, down 2.7%  over the 24-hour period.

Trading volumes across the virtual exchange market reached $4.1 billion, according to the latest available data. BitMEX saw its share of the total volume rise to 24.4% as derivatives continued to drive the market. BitMEX and other futures markets allow traders to profit from bitcoin’s decline. This avenue has increased in popularity since the selloff began last month.

Bitcoin’s market capitalization has experienced a significant drop over the course of the selloff. Now valued at $55.9 billion, bitcoin’s market cap is down a staggering $56 billion compared to early last month.

Speculation Drives Market

Speculation about bitcoin’s perceived utility in the future continues to influence market behavior far more than its actual use in today’s market, according to Stephen Pair, CEO of BitPay. Although BitPay is focused on supporting the actual market for bitcoin payments, this segment has little impact on how BTC is priced by investors and speculators.

“A very big component of the price is certainly speculation,” Pair said in a recent interview with CNBC’s Squawk Box. “It’s investors speculating on the future usage and adoption of this technology. A small component of the price is actual utility, and that’s what BitPay is focused on — using the platform and delivering products to our customers that they find valuable.”

BitPay is hoping to radically alter how bitcoin is priced in the future – not by manipulating the market, but by expanding adoption of cryptocurrency payments. Currently, BitPay processes roughly $1 billion in transactions per year, a figure Pair believes should grow ten-fold in the coming years.

Although bitcoin is accepted by hundreds of thousands of merchants globally, its primary utility continues to be as a store of value for investors looking to capitalize on the alternative asset class. Now that the initial crypto craze is over, adoption as a payment mechanism is the next great hurdle facing BTC and its peers.

Disclaimer: The author owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.

Featured image courtesy of Shutterstock.

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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4.6 stars on average, based on 701 rated postsSam Bourgi is Chief Editor to Hacked.com, where he leads content development for one of the world's foremost cryptocurrency resources. Over the past eight years Sam has authored more than 10,000 articles and over 40 whitepapers in the fields of labor market economics, emerging technologies, cryptocurrency and traditional finance. Sam's work has been featured in and cited by some of the world's leading newscasts, including Barron's, CBOE and Forbes. Contact: sam@hacked.com Twitter: @hsbourgi




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