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FTX crash pushes Bitcoin to self-custody; Ethereum switched for stablecoins

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FTX crash pushes Bitcoin to self-custody; Ethereum switched for stablecoins

FTX crash pushes Bitcoin to self-custody; Ethereum switched for stablecoins Zeynep Geylan · 5 hours ago · 2 min read

Illiquid Bitcoin supply spiked over last week, while the top four stablecoin dominance beat Ethereum’s.

2 min read

Updated: November 11, 2022 at 9:05 pm

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Cover art/illustration via CryptoSlate

After the FTX collapse, investors are moving large amounts of Bitcoin (BTC) to their self-custody wallets and exiting Ethereum (ETH)  to invest in stablecoins, according to data analyzed by CryptoSlate.

Bitcoin retreats to self custody

The chart below demonstrates the amount of liquid, illiquid, and highly liquid Bitcoins since 2008.

As of November 2022, the amount of Bitcoins held in self-custody wallets almost reached 15 million. Out of the current circulating supply of 19,204,000, this number shows that 78% of all Bitcoin is held in self-custody.

The chart below shows the illiquid Bitcoin supply in more detail since the beginning of the year, and it shows that a sharp increase was recorded this week.

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This sharp increase might be the result of the valuable lessons the community learned from the recent events with regard to FTX’s liquidity crisis. Even though FTX recently committed to doing everything it can to provide liquidity, it still abstained from making any promises.

Stablecoins over Ethereum

The chart below collects the supplies of the top four stablecoins – Tether (USDT), USD Coin (USDC), Binance USD (BUSD), and DAI (DAI)- that are on different blockchains and compares them with the Ethereum Market Cap.

The data shows that stablecoin dominance triumphed over Ethereum dominance as of Nov. 11. This only happened once before in the history of crypto during June 2022, and is a strong indicator showing that investors are moving large funds into stablecoins as Ethereum market cap drops.

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Analysis

Huobi predicts crypto market bottom in early 2023

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Huobi predicts crypto market bottom in early 2023

Huobi predicts crypto market bottom in early 2023 Christian Nwobodo · 15 mins ago · 2 min read

According to Huobi Research, Bitcoin may reach the bottom of $15000 around March 2023, which will signal the next crypto market rebound.

2 min read

Updated: December 8, 2022 at 8:46 pm

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Cover art/illustration via CryptoSlate

Leading crypto exchange Huobi Global in its 2022-2023 annual report, has predicted that the current bear cycle may soon be over, as it expects the crypto market to reach its bottom in early 2023.

On Jan. 1, 2022, the global crypto market had a total market capitalization of approximately $2.2 trillion. However, the heat of the bear market has flushed out almost $2 trillion of its value, dropping to a low of $847.6 billion as of press time.

The 2022 bear market was worsened by macroeconomic distortions resulting from interest rate hikes and surging inflation. In addition, the Terra-Luna, Three Arrows Capital, and FTX collapses led to widespread contagions that have forced many crypto companies into bankruptcy and put investors at a considerable loss.

According to Huobi’s report, the decentralized finance (DeFi) ecosystem was worse hit as the total value locked (TVL) across chains declined by over 70%. According to DefiLlama data, the TVL of DeFi protocols fell from $171 billion in January to roughly $55 billion at the end of October.

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The Non-fungible token (NFT) bubble seemed to have busted as its number of active users fell by 88.9% and the total market cap declined by 42% from a high of $35 billion to $21 billion.

Layer-2 scaling solutions witnessed more growth than other ecosystems over the year. As a result, the total value locked in Layer-2 protocols reached a peak of $7.5 billion and bottomed at $ 3.7 billion. However, since the July crash, it has gradually surged to $5.32 billion.

The light ahead for crypto

The crypto market has evolved significantly over the year, with new fields like GameFi, NFTfi, and Metaverse gaining mainstream attention. For example, the GameFi industry reportedly raised about $2.9 billion over the period.

The much-anticipated Ethereum merge was completed on Sept. 15 and introduced a new era of staking-as-a-service to the industry. As of October 2022, about 15 million ETH has been staked on the PoS chain, representing  12.56% of the total ETH supply.

In concluding the market performance segment of the report, Huobi considered the 200-Week SMA indicator, Fed’s interest rate hikes, and deleveraging of risky financial institutions to predict that the crypto market may likely find its bottom by the end of March 2023.

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Considering Bitcoin’s price action, the current $16,945 falls below the 200-Week SMA Indicator. A trend pattern is observed by juxtaposing the 2022 price cycle with 2014, 2015, 2019, and 2020 cycles. If historical data is anything to go by, Huobi predicts that Bitcoin may see a rebound soon and will lead other crypto assets out of the current bear market.

On the macroeconomic front, after four consecutive interest rate hikes of 75bp, the U.S. Federal Reserve is expected to lower rates starting from Dec 2022, likely lowering inflation significantly around March 2023. With the monetary policy reaching its bottom in early 2023, the crypto market may as well find its bottom.

The recent FTX implosion saw many overleveraged financial institutions wiped out. The overall effect of the collapse is expected to last until the first quarter of 2023.

If Huobi’s parameters play as predicted, the crypto market is expected to reach its bottom when BTC and ETH prices trade at $1,500 and $1,000, respectively.

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Altcoins

TRON [TRX] is ready for a further rally; investors can profit from this level

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TRON [TRX] is ready for a further rally; investors can profit from this level

  • TRX was in a bullish market structure.
  • A break of the current support resistance at the 38.2% Fib level ($0.5345) is possible.
  • TRX saw improved sentiment and an increase in funding rates from Binance Exchange.

TRON (TRX) is poised to rally further as technical indicators point to a massive uptrend. At press time, TRX was trading at $0.05349 and looked primed to break through current resistance at the 38.2% Fib level. 

In other news: Tether chose the TRON network for its latest Chinese Yuan (CHNT) launch. Adding this development to the impressive metrics and technical indicators, TRX is facing massive gains in the near term.

TRX’s bulls face the current resistance: Will the uptrend continue?

Source: TRX/USDT on TradingView

The immediate hurdle for TRX is the current resistance at the 38.2% Fibonacci retracement level ($0.05345). However, the technical indicators on the 4-hour charts suggest that the bulls could break this level.

In particular, the Relative Strength Index (RSI) climbed out of the lower range and was slightly above the neutral point with an uptick. This shows that selling pressure has been steadily easing, and the bulls have significant leverage in the current market.

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Accordingly, the On Balance Volume (OBV) recorded increasing trading volumes indicating increasing buying pressure. Therefore, TRX could break out above the current resistance at $0.05345. Then, bulls can focus on the new target at the 50% Fib level ($0.05377).

However, a candlestick close below the current support at $0.05305 would negate this prediction. In this case, new supports could be found at $0.05372 and $0.05341 if TRX drops lower. 

TRX saw improved weighted sentiment but a decline in development activity

Source: Santiment

TRX also recorded an improvement in weighted sentiment. According to Santiment, weighted sentiment pulled back from negative territory and was neutral at the time of publication.

This indicates a change in sentiment from bearish. A strong bullish outlook could further boost TRX’s price rally if sentiment turns positive and moves higher.  

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Accordingly, the Binance Funding Rate rose from deeply negative territory and climbed to the neutral level. This shows that the TRX derivatives market is also moving towards a bullish outlook. Taken together, these metrics indicate additional room for a further TRX price rally.  

However, TRX’s development activity took a nosedive at the time of publication. Moreover, any bearish sentiment on BTC could undermine a further price rally. Therefore, TRX investors should closely monitor BTC’s performance.

Ser Suzuki Shillsalot has 8 years of experience working as a Senior Investigative journalist at The SpamBot Times. He completed a two-hour course in journalism from a popular YouTube video and was one of the few to give it a positive rating. Shillsalot’s writings mainly focus on shilling his favourite cryptos and trolling anyone who disagrees with him. P.S – There is a slight possibility the profile pic is AI-generated. You see, this account is primarily used by our freelancer writers and they wish to remain anonymous. Wait, are they Satoshi? :/

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Analysis

Biggest Movers: LTC, ATOM Extend Declines, Hitting 10-Day Lows 

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Biggest Movers: LTC, ATOM Extend Declines, Hitting 10-Day Lows 

Litecoin fell for a third consecutive session on Thursday, as the token continued to move away from recent highs. Cryptocurrencies have been mostly lower in recent days, as traders continue to fear a global recession. Cosmos also remained in the red during today’s session.

Litecoin (LTC)

Litecoin (LTC) dropped to a ten-day low on Thursday, with the token falling for a third straight session.

Following a high of $79.20 on Wednesday, LTC/USD moved to a low of $74.82 earlier in the day’s session.

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As a result of this, the token fell to its lowest point since November 29, when prices hit a bottom of $73.39.

LTC/USD – Daily Chart

Looking at the chart, it appears that litecoin bears are hoping to push prices towards a floor at $73.00.

This seems a possibility, especially with the 14-day relative strength index (RSI) fast approaching a floor of its own.

The index is currently tracking at 57.10, and seems to be moving towards a support point of 53.00.

Cosmos (ATOM)

Another notable token on Thursday has been cosmos (ATOM), which fell to a ten-day low earlier in the day.

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ATOM/USD fell to a bottom of $9.52 on Thursday, before bulls reentered the market and bought the recent dip.

Today’s bottom saw cosmos trade at its lowest level since November 28, which was the last time the token hit its floor at $9.45.

ATOM/USD – Daily Chart

As of writing, ATOM has mostly rebounded, and is currently trading at the $9.71 level.

In addition to this, the RSI has bounced from a floor of its own at 39.50, and is currently tracking at 41.40.

Should momentum continue in an upward direction, ATOM bulls will likely target a move above the $10.00 mark.

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Do you expect cosmos to move above $10.00 this week? Let us know your thoughts in the comments.

Eliman Dambell

Eliman brings an eclectic point of view to market analysis, he was previously a brokerage director and retail trading educator. Currently, he acts as a commentator across various asset classes, including Crypto, Stocks and FX.

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Image Credits: Shutterstock, Pixabay, Wiki Commons

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