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Is Bitcoin a Safe Haven?

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This question keeps coming in crypto articles and communities and I’d like to lay it to bed once and for all.

Safe haven assets are things that tend to go up in value when there is prevalent uncertainty or fear in the world. Gold, Bonds, and the Japanese Yen are all considered Safe Havens.

Bitcoin is not a safe haven asset and bears little or no correlation with other traditional markets at this time. The cryptocurrency markets are still too small to have any effect on other markets.

The entire market cap of all cryptos is now about $100 Billion. To put it in perspective, the market cap of just the S&P 500 in the USA is standing at more than $20 Trillion.

So, the answer is no. Not in a traditional sense anyway. However, the practical use cases in specific countries like Venezuela, Argentina, Zimbabwe, Iran, Iraq, Egypt, and even Russia, that are seeing extreme currency risk proves that bitcoin is an excellent store of value.

So though it does not correlate at the moment, this is a form of digital gold.

-Mati Greenspan
eToro, Senior Market Analyst

 

Please note: All data, figures & graphs are valid as of June 15th. All trading carries risk. Only risk capital you can afford to lose.

Market Overview

The traditional markets went on a wild ride yesterday. There was a big swing down, then a big swing up only to wind up in the same place it started.

Though volatility spiked around the time of the Fed meeting, the VIX volatility index still closed at near record low levels.

As was widely expected by the markets, the Fed did indeed raise their interest rates by 0.25% despite stagnant inflation and wage growth.

The headlines that are saying that Fed has defied inflation but actually what’s happening is that they’re playing a huge game of chicken with the financial markets.

If the Fed blinks at this point or acknowledges that the economy isn’t doing well, it could set the already overvalued stock market for a tumble… and we wouldn’t want that.

What was more important yesterday was the Fed’s aggressive stance in offloading their bloated balance sheet. They have about $4.5 Trillion worth of assets that they purchased during the quantitative easing from 2009 to 2014 that they would like to start selling back to the market by the end of the year.

It’s a move intended to show confidence in the economy.

Greek Meeting Today

It’s the same old story that has been playing out since 2012. Greece currently has more debt than they could ever hope to pay back. They’ve already received two bailouts and they will need a third in order to avoid bankruptcy by next month.

The IMF wants to help but only if the EU is willing to write off some of the unsustainable debt that is choking the Greek economy. Germany is not willing to forget, or forgive and so we have a standoff.

The most likely outcome is that we see some sort of temporary deal to release enough funds to avoid another Euro crisis but a long term solution is still very far away.

Nonetheless, we will keep our eyes on the news as this story has massive market moving potential if anything changes.

Massive Crypto Correction

The cryptocurrency markets are currently seeing the biggest pullback in their short history.

Of the top 100 digital coins, only 3 are in green over the past 24 hours. The entire market has lost about $19 Billion from top to bottom.

Many traders in eToro are seeing this as a golden opportunity.

This remains the most high risk investment you could possibly take and it is possible we could see bitcoin around $1000 again before not too long. However, given the breakthrough in Japan and possibility of the same happening in India, there is a distinct possibility that over the next 24 hours we could see the lowest price that will be in the next 24 years.

Thanks for reading & have an amazing day!

This content is for information and educational purposes only and should not be considered investment advice or an investment recommendation.

Past performance is not an indication of future results. All trading carries risk. Only risk capital you’re prepared to lose.

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 133 rated postsSenior Market Analyst at Etoro.com.




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Altcoins

Gemini Dollar Approaches Parity with USD After Rocketing Higher Earlier in Week

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The newly launched Gemini Dollar (GUSD) has come back down to earth after its premium over the greenback approached 20% earlier in the week, offering yet another sign that stablecoins are anything but.

GUSD Update

After reaching a high of $1.19 on Tuesday, Gemini’s GUSD token has consolidated at $1.01, according to CoinMarketCap. At current levels, GUSD more or less serves its function as a dollar-pegged stablecoin.

GUSD has a total supply of 1.22 million units but the amount in circulation is unknown. Daily trade volumes amounted to $7 million on Thursday, according to the latest available data.

The sudden upsurge in GUSD followed a large-scale selloff of USDT, another dollar-backed stablecoin. USDT not only lost its peg to the dollar on Monday, it crashed to a low of around $0.89. That was the lowest in 18 months.

Gemini Dollar Overview

As the name implies, GUSD is the native stablecoin of Gemini, a regulated cryptocurrency exchange founded by Cameron and Tyler Winklevoss. The coin was launched in September after the brothers obtained regulatory approval from the New York Department of Financial Services to issue a dollar-pegged cryptocurrency.

As a stablecoin, GUSD is supposed to be pegged to the U.S. dollar on a one-for-one basis, giving traders access to instant liquidity on the Gemini platform without funding delays. This means every unit of GUSD issued must have a commensurate supply of fiat dollars in a Gemini bank account. This gives Gemini the discretion to release more GUSD tokens as its fiat-currency reserve grows.

Gemini claims to offer the world’s first regulated stablecoin backed by proven reserves at State Street Bank and Trust Company. The company’s focus on regulatory transparency contrasts markedly with other stablecoin projects, which have come under fire for their failure to produce a verifiable audit of their accounts.

Tether’s USDT is the most popular stablecoin in circulation, accounting for more than a fifth of all trade volumes of virtual currency exchanges, according to CoinMarketCap. Tether has been subpoenaed by the U.S. Commodity Futures Trading Commission (CFTC) amid allegations it was pumping bitcoin’s price by issuing more tokens than it has in reserves. The company also shares key executives with Bitfinex, the primary exchange accused of facilitating the pump.

Although Tether has avoided legal troubles, it has faced growing suspicion from market players. This came to a head on Monday after USDT lost its peg to the dollar.

It remains to be seen whether GUSD will become a viable alternative to USDT. Its regulatory backing paints a positive picture for the future of stablecoins, but its direct ties to Gemini could limit adoption given the exchange’s relatively small scale. As of Thursday, Gemini was the 43rd largest exchange based on adjusted trade volume.

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 647 rated postsSam Bourgi is Chief Editor to Hacked.com, where he specializes in cryptocurrency, economics and the broader financial markets. Sam has nearly eight years of progressive experience as an analyst, writer and financial market commentator where he has contributed to the world's foremost newscasts.




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Altcoins

Monero Price Analysis: XMR/USD is Stable and Gunning for Potential Gains on “Bulletproofs” Technology Update Day

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  • Monero developers have released an updated version to their protocol, implementing “Bulletproofs”.
  • XRM/USD is within a range block, with price behavior suggesting of a potential imminent breakout higher.

Monero Becoming First Crypto Over Billion-Dollar Market Cap Implementing “Bulletproofs”

Developers at the Monero foundation, have released an updated version to the protocol. This will be live from 18th and 19th October. They are becoming the first network to try out “bulletproofs”. The goal of this technology is to significantly decrease the weight of confidential transactions. From today, 18th October, the privacy-focused cryptocurrency will be testing this.

The move from Monero will make them the first crypto with over a billion-dollar market cap, to try out the “bulletproofs” technology. Over the past year, the foundation has been working on cutting the size of its confidential transactions, by at least 80 percent.  A full overview of the upgrade was posted in a blog post by Monero.

The purpose of bulletproofs are to facilitate confidential transactions. Senders and recipients addresses will remain visible, but the amounts being sent is concealed. The technology also aims to reduce transaction times and fees.

Sarang Noether, a spokesperson for Monero and a key part of the bulletproof integration, was recently speaking on the upgrade. He noted that “Bulletproofs will be replacing the “zero-knowledge range proofs”, of which their confidential transactions are reliant on. The cryptocurrency will activate the technology during its next system-wide upgrade, or hard fork. An upgrade that will require nodes to adopt a new software. Furthermore, Sarang added, “hard forks are sometimes colored as a risky process. However, this upgrade is part of Monero’s bi-annual cycle to introduce new features.”

Technical Review – 4-hour Chart

XMR/USD 4-hour chart

XRM/USD for the past going on three sessions now has been trading within a tight range-block. This trading behavior coming after the aggressive movements seen just some days before. On 11th October the price had spiked over 10% lower. To then enter a tight range, which saw a huge breakout, jumping around 20% high. Over half of this spike to the upside was reversed, moving into the three-session range as mentioned above.

Looking to the upside, eyes will be on another range-breakout. Bulls will be wanting to retest the breached supporting trend line. An attempt was made during the rally seen on 15th October, however strong resistance was observed. In terms of support, this can be eyed at the lower part of the current range, around $107.50. If the bears pile enough pressure, it vcould see a fast move back to $100, then further south below demand area from $86-76.

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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4.5 stars on average, based on 32 rated postsKen has over 8 years exposure to the financial markets. During a large part of his career, he worked as an analyst, covering a variety of asset classes; forex, fixed income, commodities, equities and cryptocurrencies. Ken has gone on to become a regular contributor across several large news and analysis outlets.




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Altcoins

NEO Price Leapfrogs Market as Technical Article Competition Underway

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NEO’s value rose a brisk 5% on Thursday, as the leading altcoin maintained a bullish outlook following the launch of a new competition designed to engage community members.

NEO Price Update

The price of NEO reached a high of $17.52, its best level in more than a week. At the time of writing, the NEO-U.S. dollar exchange rate was valued at $17.32, having gained 5.6% over 24 hours. The so-called ‘Ethereum of China’ saw daily trade volumes of $224.2 million on virtual currency exchanges.

Upside momentum is expected to face stiff resistance near $18.00. A lack of trading catalysts in the broader market could keep altcoins under wraps for a while longer as bitcoin continues to exert its dominance.

At current prices, NEO has an overall market capitalization of $1.1 billion, placing it 15th among active crypto projects.

NEO’s gains contrasted with tepid moves in the broader market on Thursday. Most major coins ranked ahead of it experienced only modest price changes over the past 24 hours. The total crypto market cap is currently hovering around $210 billion, virtually unchanged since Monday.

Technical Article Competition

NEO Blockchain announced on Thursday the start of a new technical article competition that opens the floor to community members to share their experiences. According to NEO’s official Twitter handle, the competition encourages network users “to share their experiences and knowledge focusing on the technical aspects of the NEO Blockchain.” Submissions are open until Dec. 17, with the winning articles set to receive a payout in NEO cryptocurrency.

Topics up for consideration include NEO’s technical architecture, ecosystem, smart contract development and decentralized application development, among others. A full list can be found here.

The competition was announced just one day after NEO celebrated the second anniversary of its mainnet launch. The mainnet went live in 2016 under the name Antshares at a price-per-token of around $0.08 cents. By August of last year, it had rebranded as NEO and would ride the crypto boom all the way to $160, putting it among the best-performing assets of 2017.

NEO’s ambition to power the global “smart economy” received a significant boost following the launch of dBFT, a consensus algorithm that provides scalability of 10,000 transactions per second. Despite not receiving the same press as Ethereum, NEO has emerged as a formidable player in the world of decentralized applications. Its proponents say everything that is done on Ethereum can be completed on NEO at a much faster and more efficient rate.

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 647 rated postsSam Bourgi is Chief Editor to Hacked.com, where he specializes in cryptocurrency, economics and the broader financial markets. Sam has nearly eight years of progressive experience as an analyst, writer and financial market commentator where he has contributed to the world's foremost newscasts.




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