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Betting on Bitcoin [BTC]? Here’s what you should definitely consider

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Betting on Bitcoin [BTC]? Here’s what you should definitely consider

There was a time just a few weeks ago when investors were frustrated with Bitcoin [BTC] for not being able to stay above $45,000. However, at press time, most investors were relieved that the king coin was somehow over $30k as it traded at the price of $30,424.97, after increasing by 0.41% in the past day.

So, is the Bitcoin landscape all sunshine and roses or more thunderclouds and thorns? Here’s what some metrics revealed, according to one analyst.

Betting on Bitcoin?

Fidelity’s Global Macro director Jurrien Timmer shared his favorite metrics and presented both promising and concerning signs regarding Bitcoin.

Timmer said,

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“The BTC/gold ratio is now resting on major support, in the form of the 2017 high as well as the 2021 low. At the same time, the detrended Bollinger Band shows that the ratio is now at 2 standard deviations below trend, which is a level that has contained the last 3 declines…”

Indeed, at press time, the Bollinger Bands were wide apart, indicating strong volatility. However, the candles had broken through the lower band and were slowly turning green as they trended slightly upwards once more. This indicates a possibly oversold asset seeing buying demand once again.

Source: TradingView

Adding to that, Timmer revealed that HODLers were doing what HODLers do best – holding tight to their king coins in spite of painful price drops. Timmer stated that the amount of Bitcoin HODLed for over a decade was still around 13%.

It’s interesting (but not surprising) that the 60% decline in Bitcoin has not deterred the HODLers. The number of Bitcoin held for more than 10 years is holding in steady at 13%. /7 pic.twitter.com/ksibTyBOhT

— Jurrien Timmer (@TimmerFidelity) May 16, 2022

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But that doesn’t mean the exchanges are getting a break. In fact, CoinShares’ latest flows report revealed that there were Bitcoin inflows to the value of approximately $299 million.

“Bear” with me for a moment

Some bullish investors are insistent that the crypto market is still in a bullish stage – but one person doesn’t share their views. This was none other than the creator of the Bitcoin stock-to-flow model, PlanB. The pseudonymous analyst theorized that though he had been hoping for a bull market in 2022, he felt it was “clear” that a bear market had started as early as 2021.

Dec 2021 I was still hoping for a 2nd leg of the bull market. But in Q1 2022 it became clear that this bitcoin bull market was over. We entered a bear market since Apr 2021 peak (yes ATH was Nov 2021). Now we are creating a bottom. Then a new bull market will start. BTC cycles. pic.twitter.com/cPpAnNCklx

— PlanB (@100trillionUSD) May 16, 2022

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Sahana is a full-time journalist at AMBCrypto. She has a Masters in Journalism and her areas of study include crypto-regulation, digital society, privacy, and intersectionality. Ask her about film photography and philately.

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205.8209 ETH

Risk Of ‘Significant Drawdowns’ Pushes Cypherpunk Holdings To Sell Entire Stash Of Bitcoin And Ethereum

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Risk Of ‘Significant Drawdowns’ Pushes Cypherpunk Holdings To Sell Entire Stash Of Bitcoin And Ethereum

On Tuesday, the Canada-based investment firm Cypherpunk Holdings Inc. announced that the company has sold all of its bitcoin and ethereum due to the “risk of further significant drawdowns.” The company has transitioned its treasury to cash after selling 214.72 bitcoin and 205.82 ethereum as Cypherpunk Holdings continues “to see systemic risks propagating” across the crypto economy.

Cypherpunk Holdings Sells All of the Bitcoin and Ethereum on Its Balance Sheet

Crypto winter has done a lot of damage since the bull run’s price highs, as more than $2 trillion has left the digital currency economy since the first week of November 2021. Today, the crypto economy is worth roughly $945 billion and bitcoin (BTC) is coasting along just above the $20K per unit range.

BTC is down more than 70% from the all-time high ($69K) on November 10, 2021, and ethereum (ETH) has lost more than 77% since the ATH ($4,878) recorded on the same day. On June 28, 2022, or eight months later, the publicly listed Canadian investment company Cypherpunk Holdings revealed it had dumped all of its bitcoin and ether holdings.

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Cypherpunk Holdings (CSE: HODL) (OTC Pink: CYFRF) was one of the many publicly listed companies that held bitcoin and ethereum on its balance sheet. The update from the company notes that the sale was due to risk and it said the crypto economy may see “significant drawdowns” going forward.

CEO and president of Cypherpunk Holdings Jeff Gao.

Cypherpunk Holdings sold approximately 214.7203 BTC and 205.8209 ETH and it got around $4,927,000 for the lot of crypto assets. The company said that it currently has just over $14 million worth of “cash and stables” on hand. After the sale, the CEO and president of Cypherpunk Holdings, Jeff Gao, spoke about dumping the digital assets for cash.

“Recently, Cypherpunk liquidated all of its treasury holdings in BTC and ETH for cash and withdrew back to custody,” Gao wrote in an update concerning the company’s cryptocurrency holdings and strategy.

“We continue to see systemic risks propagating throughout the crypto ecosystem and, in our assessment of the risk reward and opportunity costs involved in holding asset tokens, we believe that the most prudent approach is to sit on the sidelines as we wait for the volatility and illiquidity contagion to come to its logical conclusion,” Gao said. “On the balance of probabilities, we see weaker price action opening the way to lower levels to come as reports of the number of chains imposing ‘temporary’ suspension on withdrawals increases.”

The Cypherpunk Holdings executive continued by adding:

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Until such a time as our thesis on market conditions change, our treasury will remain in cash. Cypherpunk maintains its long-term bullish outlook on crypto and currently plans to actively seek to capitalize on compelling risk reward opportunities as and when they present.

Company Sold 196.74 Bitcoin and 382 Ether Prior to the June 28 Announcement and Amid the Terra LUNA Fallout

Furthermore, Cypherpunk Holdings dumped bitcoin (BTC) before the June 28 announcement, as it told investors on June 13 that it sold 96.74 BTC for $2.9 million and 50 ETH for $100K. Cypherpunk Holdings’ management also decided to unload shares of Animoca Brands, as it sold the company’s last block of 500,000 Animoca shares for “a realized profit of 234%.” Amid the Terra LUNA and UST fallout, on May 11, 2022, Cypherpunk Holdings sold 100 BTC and 332 ETH for just over $4 million.

With Cypherpunk Holdings removed from the Bitcoin Treasuries list, and Microstrategy’s recent purchase of 480 bitcoins, publicly-listed companies hold 268,357 BTC worth 5.382 billion at current bitcoin exchange rates. Exchange-traded products hold 828,641 BTC, countries hold 50,699 BTC, and private companies own 174,381 BTC, according to the Bitcoin Treasuries list on June 29.

What do you think about Cypherpunk Holdings dumping its bitcoin and ether because it believes “weaker price action” is coming? Let us know what you think about this subject in the comments section below.

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Jamie Redman

Jamie Redman is the News Lead at Bitcoin.com News and a financial tech journalist living in Florida. Redman has been an active member of the cryptocurrency community since 2011. He has a passion for Bitcoin, open-source code, and decentralized applications. Since September 2015, Redman has written more than 5,700 articles for Bitcoin.com News about the disruptive protocols emerging today.

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Image Credits: Shutterstock, Pixabay, Wiki Commons

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Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.

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TA: Bitcoin is Plunging, But It’s Too Early to Say Bulls Have Given Up

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TA: Bitcoin is Plunging, But It’s Too Early to Say Bulls Have Given Up

Bitcoin is struggling below the $20,000 zone against the US Dollar. BTC remains at a risk of more losses if the bulls fail to protect the $19,800 support zone.

  • Bitcoin is showing bearish signs below the $21,000 and $20,500 levels.
  • The price is now trading below the $20,400 level and the 100 hourly simple moving average.
  • There is a key bearish trend line forming with resistance near $20,400 on the hourly chart of the BTC/USD pair (data feed from Kraken).
  • The pair could decline further if there is a clear move below the $19,800 zone.

Bitcoin Price Remains At Risk

Bitcoin price failed to recover above the $21,000 pivot level. The price remained in a bearish zone and extended its decline below the $20,500 support zone.

There was also a close below the $20,250 level. BTC spiked below the $20,000 level, but the bulls were active near $19,800 level. A low is formed near $19,828 and the price is now consolidating losses. It is now trading below the $20,400 level and the 100 hourly simple moving average.

An immediate resistance on the upside is near the $20,150 level. It is near the 23.6% Fib retracement level of the recent decline from the $21,188 swing high to $19,828 low.

The next key resistance is near the $20,400 zone. There is also a key bearish trend line forming with resistance near $20,400 on the hourly chart of the BTC/USD pair. The trend line is near the 50% Fib retracement level of the recent decline from the $21,188 swing high to $19,828 low.

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Source: BTCUSD on TradingView.com

A clear move above the trend line resistance and then $20,500 could start a recovery wave. In the stated case, the price could rise towards the $20,900 level. The next major hurdle for the bulls might be near the $21,200 zone, above which the price may perhaps rise towards the $21,800 level.

More Losses in BTC?

If bitcoin fails to clear the $20,500 resistance zone, it could continue to move down. An immediate support on the downside is near the $20,000 level.

The main support now sits near the $19,800 level, below which the price could accelerate lower. The next major support sits near the $18,800 zone. Any more losses could send the price towards the $18,000 level.

Technical indicators:

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Hourly MACD – The MACD is now losing pace in the bearish zone.

Hourly RSI (Relative Strength Index) – The RSI for BTC/USD is now below the 50 level.

Major Support Levels – $20,000, followed by $19,800.

Major Resistance Levels – $20,150, $20,400 and $20,500.

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altcoins performance

Bitcoin Records Worst Performance For June, Will It Get Better From Here?

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Bitcoin Records Worst Performance For June, Will It Get Better From Here?

Bitcoin performance for the month of June has been nothing short of unremarkable so far. Being a market leader, the other cryptocurrencies in the market have mirrored its movements for the month, leading to massive losses across the board. However, the numbers for June are in and it shows that bitcoin’s performance for the month has been worse in comparison to its altcoin counterparts.

Bitcoin Performance Staggers

Performance all across the board has been terrible. So far, all of the indexes have come back with double-digits in losses for the month of June, and that is in addition to the subpar performance the market had seen in the prior month. But instead of the expected small cap altcoins returning the worst of the losses, bitcoin has barreled to the forefront to register more losses than any other index.

Related Reading | Outflows Rock Bitcoin As Institutional Investors Pull The Plug, More Downside Coming?

The pioneer cryptocurrency saw losses touch as high as -35% as the month draws to an end. This has resulted in a decline in the dominance of bitcoin over the broader market after recovering to 48% in early June. BTC dominance is now sitting at 43.69% according to data from TradingView.com.

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BTC records wost performance for June | Source: Arcane Research

Mostly the losses have stemmed from the liquidations of large players in the space. The losses recorded in bitcoin can however be attributed to the fact that creditors focus their efforts on more liquid coins like bitcoin. Thus the losses are more pronounced in the digital asset.

Altcoins Suffer In Tandem

Although the altcoins in the space have not recorded as many losses as bitcoin, they have seen high losses too. The large cap index is one that follows bitcoin very closely. Hence, the decline in BTC’s price tends to be more pronounced in these digital assets. It is also due to creditors liquidating these coins first due to their high liquidity. So far, the large cap index is down -33% in the same time period.

BTC drops to low $20,000s | Source: BTCUSD on TradingView.com

The mid and small cap indexes have done much better compared to their larger counterparts. Their losses still range into double-digits but creditors have held off on liquidating these cryptocurrencies. This is because they tend to be more illiquid and are therefore pushed to the back burner in favor of larger ones such as Bitcoin and Ethereum. The mid and small cap indexes have recorded losses of -24% and -22% for the month of June alone.

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Related Reading | Ethereum Fees Touch Monthly Lows As Transaction Volumes Plummet

However, it is not a good prognosis for these small cap altcoins. Given that sell-offs in coins such as bitcoin and Ethereum are nearing an exhaustion point, creditors will turn their attention to smaller altcoins too. And given the fact that they possess less liquidity, liquidations in these digital assets will lead to larger declines in price.

Featured image from Film Daily, charts from Arcane Research and TradingView.com

Follow Best Owie on Twitter for market insights, updates, and the occasional funny tweet…

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