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Week in Review

Week in Review: XRP’s 115% Power Surge Leads Cryptocurrency Market Higher

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XRP was the standout performer in the cryptocurrency world this week. The so-called banker’s cryptocurrency rebounded more than 115% after a Ripple Labs executive teased an upcoming product release that could streamline XRP adoption.

The broader cryptocurrency market followed XRP higher after the U.S. Securities and Exchange Commission (SEC) announced it would delay a ruling on a keenly awaited bitcoin exchange-traded fund (ETF).

In traditional markets, U.S. stocks resumed their record-setting gains as pro-growth optimism outweighed lingering fears of an all-out trade war with China.

XRP Leads Crypto Uptrend

XRP is coming off its best week since the bull market as investors rallied behind the anticipated launch of the first xRapid product.   Ripple’s Sagar Sarbhai told CNBC this week he’s “confident” that a new cryptocurrency product will be released “in the next month or so.”

The value of XRP rocketed 115% between Tuesday and Friday, reaching its highest level in three-and-a-half months. The broader cryptocurrency market gained $25 billion on Friday to reach $224.3 billion, the highest in over two weeks. Altcoins and tokens led the end-of-week surge, dragging bitcoin’s dominance rate all the way back down to 51.8%.

XRP does risk a pullback at some point in the foreseeable future as markets contend with overbought levels. Traders also routinely “buy the rumor and sell the fact,” which explains price declines that occur after an anticipated positive event has occurred.

SEC Weighs Bitcoin ETF Decision

Washington’s securities regulator has announced it will seek further comments on a highly touted bitcoin ETF, a sign that officials were still grappling with a proposed rule change that would make it easier for issuers to securitize cryptoassets. The ETF in question – the VanEck SolidX Bitcoin Trust – was initially filed on June 6.

In a notice published on Thursday, the SEC outlined 18 key issues that require more input from the public. In particular, regulators are weighing the assertion that physically-backed bitcoin is less susceptible to manipulation than other commodities available in exchange-traded products.

From the notice:

“The Commission is instituting proceedings to allow for additional analysis of the proposed rule change’s consistency with Section 6(b)(5) of the Act, which requires, among other things, that the rules of a national securities exchange be ‘designed to prevent fraudulent and manipulative acts and practices, to promote just and equitable principles of trade,’ and ‘to protect investors and the public interest’.”

U.S. Stocks at Record Highs

The Dow Jones Industrial Average and S&P 500 Index notched record highs this week, as investors shrugged off an escalating trade war between China and the United States. Gains were largely driven by a rebound in technology shares as well as optimism that the U.S. economy is on solid footing.

Labor market data confirmed that outlook on Thursday as initial jobless claims fell to nearly five-decade lows. Last week, the Department of Labor reported a stronger than expected jump in hourly wages, a sign that plentiful jobs and declining unemployment was leading to higher pay.

The U.S. economy is coming off its best quarter of growth since 2014. Unlike 2014, the Q2 upsurge didn’t follow a ‘polar vortex,’ which had temporarily disrupted economic activity four years ago. According to the Atlanta Federal Reserve, the economy is forecast to grow at an even faster rate in the third quarter. Current estimates peg Q3 growth at 4.4% year-over-year.

The Week Ahead

Is this the end of the dreaded crypto market downtrend? It’s too early to be sure but the latest rebound in XRP and bitcoin suggests that the bears have relinquished their grip on the market, at least in the short term. Stepping back, however, bitcoin remains in a protracted bear market that could continue for the foreseeable future. For investors, this means lateral moves and tighter trading ranges are to be expected.

Monetary policy is back on the agenda next week as the Federal Reserve meets in Washington. The Federal Open Market Committee (FOMC) is widely expected to raise interest rates on Wednesday and may signal for one additional hike this year. The FOMC policy statement will be accompanied by quarterly projections for GDP, unemployment and inflation, as well as the ‘dot-plot’ summary of interest rate expectations.

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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4.7 stars on average, based on 773 rated postsChief Editor to Hacked.com and Contributor to CCN.com, Sam Bourgi has spent the past nine years focused on economics, markets and cryptocurrencies. His work has been featured in and cited by some of the world's leading newscasts, including Barron's, CBOE and Forbes. Avid crypto watchers and those with a libertarian persuasion can follow him on twitter at @hsbourgi




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Week in Review

Crypto Spring? Bitcoin on Track to Snap Six-Month Losing Streak Following Spectacular Week

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The long awaited ‘crypto spring’ may have arrived early for bitcoin (BTC) and its altcoin peers. After weeks of steady accumulation on virtual currency exchanges, a high-volume surge drove bitcoin to its best levels in almost two months. The leading digital currency is now teetering on the brink of bullish reversal.

Many of the leading altcoins and tokens registered double-digit gains this week, with EOS (EOS) emerging as the clear-cut winner. On the back of a 38% weekly gain, the Enterprise Operating System is now within $500 million of its ICO capitalization.

Bitcoin’s 10% Weekly Growth

The bitcoin price returned above $4,000 this week following a sudden surge in trade volumes on virtual exchanges. Bitcoin’s daily turnover crossed $10 billion on Tuesday, the highest in around ten months.

Bitcoin is not only charting a weekly gain of 10%, it is on track to end a six-month losing streak that has resulted in a 60% loss in market cap. After peaking at $4,174, the leading digital currency found itself trading in the mid-$4,000 range on Friday.

The bulls are targeting $4,200 as the next major resistance test; north of this level, there’s not much standing in the way of a return to $5,000. A sustained rally north of this level and back toward $6,000 – the breakeven rate for miners – is needed to negate the long-term downtrend.

Further reading: Has Bitcoin Bottomed? A Closer Look at the Bullish and Bearish Cases.

EOS Breakout

EOS is approaching ICO-level capitalization following a 38% weekly surge. The platform for decentralized applications is currently trading at $3.88, which is the highest since November. The breakout north allowed EOS to ‘flip’ Litecoin (LTC) for fourth spot in the crypto market index.

The sudden EOS rally got its cue from the broader cryptocurrency market in general and Ethereum (ETH) in particular. Ether, which is EOS’ main competitor, began to trek higher last weekend as trade volumes surged to monthly highs. The so-called developer’s cryptocurrency is being propped up by optimism tied to Constantinople, an upcoming hard fork.

Investors also bought up EOS over a ‘fear of missing out’ on the latest crypto rally. It also helps that the cryptocurrency was severely oversold during the last leg of the bear market.

Still, EOS has a long way to go before achieving mass adoption. The lack of a vocal leader akin to Vitalik Buterin (Ethereum) and Roger Ver (bitcoin cash) may be part of the problem. CCN.com has more on this story here

Crypto Market Cap Rises $14 Billion

Gains were reported across all major cryptocurrencies this week and only three of the top 50 coins failed to generate positive returns. Even then, losses were limited to less than 0.5% and concentrated in stablecoins.

The following table, courtesy of CoinMarketCap, shows the extent of the weekly returns for the top 20 coins. Among them, 11 reported gains of 10% or more, with Maker (MKR) and Ethereum each rallying more than 20%.

The cryptocurrency market cap peaked at $136.2 billion on Wednesday. On Friday, the market was valued at $134.6 billion, having gained $14 billion compared to last week.

During the height of the rally, trade volumes topped $36 billion, the highest since last May. Read more: Crypto Markets are Up $16 Billion Since Sunday; What’s Behind the Rally?

Exchange-based volume likely accounts for less than half of total market turnover. Over-the-counter markets and private bilateral contracts for bitcoin have also seen an influx of trading activity. It is estimated that the over-the-counter market is at least as big as virtual exchange venues.

The Week Ahead

Signs of crypto spring have finally emerged, but not everyone is convinced that the worst is over. Alex Sunnarborg, a founding partner of crypto hedge fund Tetras Capital, recently told Forbes that calling a bottom is “very difficult” at this time. But even he has to admit that volume tells a compelling story.

Whether bitcoin and its peers have bottomed or not could be irrelevant in the long term. The recent wave of institutional adoption by the likes of Intercontinental Exchange, Fidelity, JP Morgan, Stuttgart Exchange Group and even Virginia pension funds suggest that cryptocurrency represents a paradigm shift for traditional finance.

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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4.7 stars on average, based on 773 rated postsChief Editor to Hacked.com and Contributor to CCN.com, Sam Bourgi has spent the past nine years focused on economics, markets and cryptocurrencies. His work has been featured in and cited by some of the world's leading newscasts, including Barron's, CBOE and Forbes. Avid crypto watchers and those with a libertarian persuasion can follow him on twitter at @hsbourgi




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Week in Review

Jamie Dimon Gets Crypto Fever as JPMorgan Develops Stablecoin; Bitcoin Fundamental Improve

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JPMorgan Chase & Co, America’s largest bank by a significant margin, shocked the crypto landscape this week by unveiling a new stablecoin project designed to enhance its $6 trillion payment market. For CEO Jamie Dimon, the launch of ‘JPM Coin’ is a significant departure from the anti-crypto tirades of 2017-18. While JPM Coin may not be a cryptocurrency by the traditional sense of the term, its creation comes on the heels of a blockchain revolution that started ten years ago with the launch of bitcoin – the same asset Dimon derided as a “fraud.”

Introducing JPM Coin

On Thursday, JPMorgan Chase unveiled a new stablecoin geared toward enhancing its multi-trillion-dollar payments business. JPM Coin will help clients reduce the cost, risk and processing time associated with cross-border payments. In doing so, it takes a playbook out of Ripple Labs, whose institutional clients are leveraging XRP technology to streamline global payment networks.

As a stablecoin, JPM Coin has a fixed value pegged to the U.S. dollar. The bank said it will support other major currencies in the future. No further details were provided.

In an official press release, the bank said: “We have always believed in the potential of blockchain technology and we are supportive of cryptocurrencies as long as they are properly controlled and regulated.”

More on this story: Morgan Chase’s JPM Coin: A Banker’s Intranet, or the First Major Attack on Bitcoin?

Bitcoin Volatility Drops, Transactions Rise

Although bitcoin’s price failed to attract bids this week, the network’s underlying fundamentals continued to improve. As Hacked reported on Thursday, bitcoin’s January transactions reached their highest level in a year and were nearing levels not seen since the bull market in 2017. At the same time, median fees plunged to their lowest levels since 2015.

The data were presented in a weekly cryptocurrency publication by Diar.

On the price front, bitcoin continued to find support near $3,600. Trade volumes remained elevated throughout the week, only falling below $6 billion on Friday. Average volatility over the past 30 days has fallen to the lowest level in three months, according to data from bitvol.info. Volatility has been in firm retreat since mid-December, right around the time bitcoin established new lows near $3,100.

After surging by $10 billion last Friday, the total cryptocurrency market was little changed this week. At last check, the combined market capitalization was $120.5 billion.

Trump to Declare National Emergency

U.S. President Donald Trump is expected to approve a new budget deal on Friday that avoids a second government shutdown, but will only do so after declaring a national emergency over border funding. By declaring a national emergency, the president can divert funds from the Department of Defence toward the construction of a new border-security fence along the U.S.-Mexico border.

Republicans and Democrats in Congress reached a tentative budget deal late Monday that included $1.38 billion in additional funding for border security. That’s only enough to fund an additional 55 miles of border protection and does not include appropriations for the steel barrier the president proposed. Trump wants $5.7 billion for a steel barrier that extends for 234 miles.

Senate Majority Leader Mitch McConnell, who broke the news on Thursday, said he supports the declaration. However, the plan has been met with criticism from both parties, with Democrats vowing to challenge any efforts to move money without congressional approval.

The Week Ahead

Crypto winter is in a deep freeze at the moment. The landscape has grown colder in recent months as traders continue to discount major fundamental developments centered on adoption and institutional investment. This is further evidenced by the lack of response to JPM Coin, whose creation may usher a new era of legitimacy for crypto projects – at least, in the eyes of traditional finance.

While things are pretty much status quo in crypto and, traditional markets will be forced to contend with the fallout from President Trump’s national emergency as well as ongoing trade negotiations between the U.S. and China. These factors could present new risks for Wall Street’s bullish revival since Boxing Day.

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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4.7 stars on average, based on 773 rated postsChief Editor to Hacked.com and Contributor to CCN.com, Sam Bourgi has spent the past nine years focused on economics, markets and cryptocurrencies. His work has been featured in and cited by some of the world's leading newscasts, including Barron's, CBOE and Forbes. Avid crypto watchers and those with a libertarian persuasion can follow him on twitter at @hsbourgi




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Week in Review

Weekly Recap: Crypto Markets Get a Shake-Up as Litecoin Ascends; Bitcoin ETF Has Another Backer at the SEC

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Cryptocurrencies were on the path to recovery Friday, as Litecoin’s sudden ascendancy propelled markets higher. This had a domino effect on the top 10 coins, whose rankings shifted following Litecoin’s explosive move north. The market’s performance on Friday helped offset a lackluster start to the week that saw coin values plunge to new yearly lows.

Proponents of the VanEck SolidX Bitcoin Trust reignited the debate over crypto ETFs last week after they resubmitted their application with the U.S. Securities and Exchange Commission (SEC). According to an unpublished interview with the Commission’s lone Democrat, it’s only a matter of time before the regulator approves its first bitcoin exchange-traded fund.

Litecoin Surge

Litecoin caused quite the stir on Friday after prices surged 16% in a matter of hours. This allowed LTC to scale three spots in the crypto rankings, overtaking bitcoin cash, EOS and Tether for fourth spot by market capitalization. At the time of writing, Litecoin is nurturing gains of 13% to trade at $37.74, the highest in nearly a month.

While there was no immediate catalyst for the sudden surge, the market appears to be benefiting from news that the Litecoin Foundation is looking to implement new privacy features through the MimbleWimble protocol. This was confirmed by Charlie Lee, Litecoin’s founder.

Market participants also pointed to an upcoming Litecoin halving event as a potential early catalyst for the rally. If that’s the case, investors can expect interest in LTC to gather pace for months to come. The next halving event is projected to occur around Aug. 5, 2019.

Binance Coin: Biggest Weekly Gainer

Binance Coin (BNB) entered the top-ten crypto index for the first time this week, as traders rallied behind a bevy of fundamental news surrounding the exchange.

BNB has been riding a wave of momentum tied to Binance Launchpad, a new platform for token sales. On Jan. 28, BitTorrent Token (BTT) became the first cryptocurrency to be sold on the platform. In the BNB session, all 23.76 billion BTT were sold to participants in less than 14 minutes. The Tron session sold all of its 35.64 billion BTT in less than 15 minutes.

More on the BTT sale: 100% Completed: The BitTorrent ICO is a 15-Minute Sellout.

The market cap for BNB has surpassed $1.1 billion following a 23% weekly surge. The cryptocurrency has gained 31% since the start of 2019.

Bitcoin ETF: Only a Matter of Time

It’s only a matter of time before the U.S. Securities and Exchange Commission approves the first bitcoin ETF, according to Robert J. Jackson, Jr., the agency’s lone Democratic Commissioner. In a soon to be released interview with Congressional Quarterly, Jackson said it probably won’t be long before someone satisfies the SEC’s standards for a crypto-backed fund.

“Eventually, do I think someone will satisfy the standards that we’ve laid out there? I hope so, yes, and I think so,” he said, according to Drew Hinkes, an Adjunct Professor at New York University.

Jackson added: “Getting the stamp of approval from the deepest and most liquid capital markets in the world is hard, and it should be. Once we make it available to everyday mom and pop investors, we are taking risks that Americans can get hurt.”

The Commissioner didn’t elaborate on when a bitcoin ETF could be approved or whether the recently re-submitted VanEck-SolidX application could satisfy the SEC’s criteria. However, Jackson did dispute the SEC’s decision to turn down the Winklevoss application last year. More on this story: Crypto Markets See Modest Gains as SEC Commissioner Hints at Bitcoin ETF Approval.

The Week Ahead

The crypto rally on Friday has done little to alleviate concerns that a more protracted bear market is looming. That’s because bitcoin is coming dangerously close to its December 2018 low, having given back a majority of its post-crisis recovery. Where bitcoin goes, the broader market will follow. This remains true with very few exceptions.

This alone doesn’t preclude the possibility of range-bound trading continuing next week. However, prolonged periods of lateral moves have been detrimental for bitcoin, as they are almost always followed by deeper moves south (at least, this has been the case during the last half of the bear market). For now, day trading should be relegated to those willing to assume significant risk. The value proposition for long-term holders remains intact.

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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4.7 stars on average, based on 773 rated postsChief Editor to Hacked.com and Contributor to CCN.com, Sam Bourgi has spent the past nine years focused on economics, markets and cryptocurrencies. His work has been featured in and cited by some of the world's leading newscasts, including Barron's, CBOE and Forbes. Avid crypto watchers and those with a libertarian persuasion can follow him on twitter at @hsbourgi




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