Bitcoin has barely flinched in the face of the dollar’s best attempt at a rebound in over a year. The greenback is trying to stage a comeback against the top cryptocurrency, which has left the global reserve currency battered and beaten.
Although Bitcoin has fended off the advance in USD, if history repeats and the dollar surges, a short term » Read more
” href=”https://www.newsbtc.com/dictionary/bear/” data-wpel-link=”internal”>bear phase could be coming to the crypto market soon.
The Badly Beaten Dollar Begins Breakout And Bounce
2021 thus far has been Bitcoin’s best year on record. 2020 was among the dollar’s worst as sentiment turned negative and inflation fears pushed investors toward hard assets like gold and crypto.
However, according to the DXY Dollar Currency Index, which weighs the dollar against a bucket of other national forex currencies, a comeback is in the making.
The dollar is breaking out from a falling wedge. Will crypto respond? | Source: DXY on TradingView.com
The chart above shows the DXY breaking out from a falling wedge pattern, and coming back down to retest the former resistance line as support. With the retest complete, a stronger push higher should result.
Related Reading | Dollar, Divergences, & More: Here’s Why Bitcoin Could Soon Bounce
Thus far Bitcoin has remained largely unaffected by the dollar’s advance, despite one half of the cryptocurrency’s main trading pair featuring the fiat currency.
A bullish MACD crossover will confirm the breakout as it has in the past | Source: DXY on TradingView.com
Coinciding with the breakout of the falling wedge, on higher timeframes, the MACD – a momentum indicator – is starting to turn upward. Past instances of the same pattern breaking upward combined with a bullish crossover on the MACD has led to sustained upside in the DXY.
How A Reversal In The Greenback Could Send Bitcoin Into A » Read more
” href=”https://www.newsbtc.com/dictionary/bear/” data-wpel-link=”internal”>Bear Market
Although the leading cryptocurrency by market cap has shaken off the greenback’s rebound thus far, a » Read more
” href=”https://www.newsbtc.com/dictionary/bear/” data-wpel-link=”internal”>bear phase could soon be coming that sets back the current uptrend for some time.
” href=”https://www.newsbtc.com/dictionary/bear/” data-wpel-link=”internal”>bear market in Bitcoin, as pictured below.
Each bullish crossover in the dollar led to a crypto » Read more
Bitcoin has been an uptrend for nearly a full year – since Black Thursday in 2020 – but time could be running out. The MACD hasn’t fully crossed over just yet, but has begun to turn upward.
Related Reading | This Unique Take On Bitcoin Suggests A Bear Phase Is Near
However, not all is lost for Bitcoin and the rest of the crypto market. An inverse head and shoulders on high timeframes might have completed on the DXY, which after a throwback to the trendline to confirm it as resistance, could result in the largest collapse in the dollar’s history, and its eventual undoing.
Upside in the dollar could ultimately be limited, benefiting Bitcoin | Source: DXY on TradingView.com
Such a scenario would suggest a bear phase in Bitcoin will arrive sooner than later, but that it will be much shorter-lived than previous » Read more
” href=”https://www.newsbtc.com/dictionary/bear/” data-wpel-link=”internal”>bear markets, and once it ends, the leading cryptocurrency by market cap could completely take over as the global reserve currency.
Of course, there’s no telling what the dollar could do from here, or if this time is actually different.
Featured image from Deposit Photos, Charts from TradingView.com
Bitcoin At $100,000: Estimating The Chance Of Six Figure BTC In 2021
Bitcoin price (BTC) reached a new all-time high this week, soaring to almost $65,000 on Wednesday the 14th of April. With Bitcoin’s price now in “blue sky territory” and its market cap sitting comfortably around the $1.17 trillion level, the big question is – just how high will the current bull market push the BTC price this year?
Rounding Up The Most Famous Bitcoin Price Predictions
Here are some of the most famous individuals and institutions in crypto that have gone on record with bullish Bitcoin price calls:
In March, analysts at major US investment bank, JPMorgan, were reported to be eyeing a Bitcoin price of $130,000 – although no timeframe was provided for their prediction. JPM’s CEO, Jamie Dimon, was vocal in his criticism of Bitcoin in the past. However, the firm’s increasing involvement in crypto projects reflects the growing integration of cryptocurrency within the traditional financial sector.
Related Reading | The Bearish Bitcoin Chart Bulls Definitely Don’t Want To See
MicroStrategy’s CEO, Michael Saylor, is renowned for converting his firm’s cash reserves to Bitcoin and encouraging other corporate leaders to follow suit. At last count, MicroStrategy held over 90,000 BTC, worth approximately $5.5 billion at the time of writing. Unsurprisingly, Saylor is extremely bullish on the BTC price, saying in a March interview that he “can see Bitcoin going to a million… [or] five million.”
Pantera Capital, launched in mid-2013 as the original American crypto investment fund, has projected a Bitcoin price of $115,000 before September of 2021. Pantera’s call is based on the Stock to Flow (S2F) model of Bitcoin’s price, which has thus far shown a high degree of predictive power. Given the time-specificity of Pantera’s call as well as their transparency regarding its rational basis, we would consider this the most considered prediction.
Daily Bitcoin chart showing the bull run since late 2020 until present | Source: BTCUSD on TradingView.com
A Rally-Supportive Economic Environment
Predictions alone, no matter who makes them, aren’t enough to elevate Bitcoin to a six-digit price level. What’s needed are enthusiastic buyers and hodlers, whether they be individual investors or large institutions.
As to the latter, we’ve already alluded to MicroStrategy’s crypto corporate coffers. Perhaps following Saylor’s advice as presented to thousands of corporate representative, Time Magazine recently announced their own acquisition of Bitcoin.
Furthermore, with financial titans like BlackRock and MasterCard recently announcing their involvement in Bitcoin, there can be no doubt of the institutional appetite for » Read more
” href=”https://www.newsbtc.com/dictionary/satoshi/” data-wpel-link=”internal”>Satoshi’s invention.
The stock-to-flow model projects much higher prices for BTC | Source: Digitalik.net
Perhaps the most compelling reason driving investors, big and small alike, into Bitcoin is the expectation – and indeed the observation – of high inflation. With central banks around the world printing billions if not trillions of fresh fiat units as a response to COVID 19, the scene has been set for declining fiat value and rising costs for goods and services.
Related Reading | Coinbase COIN Debuts To A Bloody Bitcoin, But Bullish Structure Remains
With high inflation everywhere except government statistics – steel prices up 3x on the year, for example – it’s no wonder that demand for hard, deflationary money has never been higher.
Featured image from Deposit Photos, Charts from TradingView.com
Coinbase’s $86bn Valuation Has Been Grossly Exaggerated by Misleading Media
Coinbase shares closed at $327 on their Nasdaq debut, giving the crypto exchange an initial market cap of $86bn on a fully diluted basis.
Fully diluted refers to the total number of common shares outstanding and available to trade on the open market after all possible sources of conversion. But some feel this measure gives an inaccurate valuation as it includes options and restricted stock, therefore overstating the number of shares used in the valuation.
In the buildup to the IPO, some analysts expected Coinbase to achieve a $100bn valuation. While its closing valuation wasn’t a million miles away, it was still less than expected.
Coinbase Listing is a Watershed Moment For The Cryptocurrency Industry
Coinbase is the first major crypto company to test the U.S. public market. Its IPO was hailed as a turning point in cryptocurrency going mainstream. Analyst Dan Ives wrote:
“Coinbase is a foundational piece of the crypto ecosystem and is a barometer for the growing mainstream adoption of bitcoin and crypto for the coming years in our opinion.”
” href=”https://www.newsbtc.com/dictionary/coin/” data-wpel-link=”internal”>COIN opened at $381 on the Nasdaq Global Select Market. Early on, buyers pushed the price as high as $429, but bears soon took over to dip the price as the day wore on. It ended the session at $327.
Source: COINUSD on TradingView.com
The firm had released some impressive figures before its public debut. It showed a spike in revenue and a doubling of its monthly active users from the previous quarter.
But market research firm New Constructs had already sounded the alarm on a severe overvaluation at $100bn. They believe a valuation this high takes no account of a future squeeze on its transaction margins.
the company has little-to-no-chance of meeting the future profit expectations that are baked into its ridiculously high expected valuation of $100 billion.”
The Actual Valuation Should be $65mn
While Coinbase’s fully diluted valuation came in at $86bn, pretty much in the middle of pre-debut expectations of between $60bn – $100bn, CIO at Arca Jeff Dorman said this figure is grossly overstated.
Dorman slammed the media for “misinformation” and “horrible reporting,” saying they were using the wrong share count. Based on 198mn class A and B shares, Coinbase’s closing valuation should be $64.7mn.
“That math is wrong — There are 198mm class A and class B shares o/s, not 261mm. If we use fully diluted share count, then every stock on the planet has infinite shares due to no restrictions on how much stock a company can issue.“
On the matter of ever reaching a $100bn valuation, researcher Larry Cermak expects this to happen as long as the bull market continues.
“Direct listings almost always trade down in the next few days because of the high float that’s being dumped. As long as the bull market continues, it will eventually recover and go $100B+ IMO. Low volume today is somewhat surprising though.”
At this point, it’s unclear whether an overstated Coinbase market cap is a help or hindrance to crypto. While an overstated valuation is likely to drum up interest, the spin side sees additional pressure on Coinbase to live up to the hype.
ETH bonanza as three North American Ethereum ETFs approved in one day
While gaining exposure might still be difficult south of the US-Canada border, Canadian investors will shortly have a host of options to choose from to gain exposure to Ethereum (ETH) via an ETF as regulators have approved three different Ethereum ETFs in a single day.
Purpose Investments, Evolve ETFs, and CI Global Asset Management were all approved by Canadian regulators to launch Ethereum-backed ETFs today. The ETFs will be the first ETH ETFs in North America, and among the first in the world.
Some observers noted that all three being approved at once may have been part an effort not to give Purpose an “unfair advantage”. Purpose appeared to gain an edge after the launch of the wildly popular Purpose Investments ETF, the first North American Bitcoin ETF which quickly swelled to $1.3 billion in AUM while competitors waited for approval. Rival Evolve Fund Group’s Bitcoin ETF only managed to attract $100 million in AUM, despite launching only two days later than Purpose and offering 25% less management fees.
In a Tweet, a reporter for Bloomberg said that the CL Galaxy and the Purpose ETF funds will begin trading on 4/20 — a date he thought would please Elon Musk, given it’s marajuana culture connection. Likewise, Evolve’s ETH ETF — which they first filed for in March — will begin trading on the same day.
Updating yet again… @CIGlobalAsset & @GalaxyDigital just got approval for their #Ethereum ETF alongside @PurposeInvest‘s. I THINK both will begin trading on … wait for it … 4/20 — Amazing @elonmusk https://t.co/SNFY4jNpUa pic.twitter.com/4ZUSCJEVQ5
— James Seyffart (@JSeyff) April 16, 2021
The Canadian stock market has already demonstrated a significant appetite for exposure to crypto assets. Previous exchange-traded Ethereum products led to market halts on the first day of listing, and Purpose’s Bitcoin ETF cracked $100 million in its first day of trading.