Connect with us
[crypto-donation-box]

Blockchain

Skeptics Argue US Stocks Correlation a Major Problem for Bitcoin in 2020

The continued correlation between Bitcoin (BTC) and U.S. stocks in 2020 is calling into question crypto’s place as a hedge against market uncertainties. The largest crypto by market capitalization recently suffered a $1,500 decline which coincided with a massive gutting of tech stocks. Bitcoin Moving in Tandem With the Equity Market Bitcoin and the stock […]

The post Skeptics Argue US Stocks Correlation a Major Problem for Bitcoin in 2020 appeared first on BeInCrypto.

Republished by Plato

Published

on

The continued correlation between Bitcoin (BTC) and U.S. stocks in 2020 is calling into question crypto’s place as a hedge against market uncertainties.

The largest crypto by market capitalization recently suffered a $1,500 decline which coincided with a massive gutting of tech stocks.

Bitcoin Moving in Tandem With the Equity Market

Bitcoin and the stock market have seen a great deal of co-movement in 2020, with their respective peaks and troughs coinciding regularly. For Bloomberg analyst Joe Weisenthal, this apparent correlation is proving to be the biggest problem for BTC in 2020.

Bitcoin remains correlated with the stock marketBitcoin remains correlated with the stock market
Source: Coinmetrics

Indeed, Bitcoin proponents argue that BTC is a haven asset. Thus, the BTC price action should behave differently from that of the mainstream equity market.

However, on multiple occasions in 2020, Bitcoin has failed to offer any diversification from the stock market. During the Black Thursday panic of mid-March, both arenas experienced significant declines with BTC sinking to about $3,800.

At the start of September, the same phenomenon occurred with Bitcoin’s $1,500 drop following heavy selloffs for the S&P 500, the Dow, and the Nasdaq.

2020 Is a Unique Year

While the data does suggest a correlation between Bitcoin and the stock market, an argument could be made for characterizing 2020 as a unique year. Indeed, Weisenthal raises the same point, calling 2020 “an exceptional year,” but also adding that such periods are when uncorrelated assets prove their mettle.

Tweeting on Wednesday, stock-to-flow (S2F) model creator PlanB maintained that Bitcoin was still a hedge asset. According to him, the still-maturing BTC will become a more robust risk-off commodity compared to gold as it becomes scarcer.

However, for now, the data points to a continuation of this correlation trend, at least in the short term. Quantitative easing by the Federal Reserve means that more cash is available for investments.

At the time of writing, Bitcoin is attempting to consolidate above the $10,000 level after staving off multiple dips below $9,800. The Nasdaq 100 futures market is also seeing a similar recovery, pointing to the return of some optimism among investors.

US Dollar Recovery?

The recent U.S. dollar recovery might play a pivotal role in determining the destiny of the price action for both Bitcoin and the stock market. For Robert Balan of the stock market analytics platform Seeking Alpha, the U.S. dollar recovery may extend until the middle of 2021.

Recovering US dollarRecovering US dollar
Source: TradingView

Typically, a weakening dollar triggers a bullish advance for Bitcoin. Indeed, as the greenback fell to its lowest level in over two years in 2020, BTC saw a sharp recovery from its Black Thursday crash.

However, according to FxPro, the recent U.S. dollar gains are not enough to flip the currency’s downtrend narrative. The forex brokerage service believes the current one-week winning streak may be a bull trap, meaning a further decline for the greenback could be in store.

Want to know more?

Join our Telegram Group and get trading signals, a free trading course and daily communication with crypto fans!

Source: https://beincrypto.com/skeptics-argue-us-stocks-correlation-a-major-problem-for-bitcoin-in-2020/

Blockchain

WOOFY, SHIB, ELON, Dogecoin: Memecoins are ideal for traders looking to make this move

Republished by Plato

Published

on

The Dogecoin narrative is gaining popularity and interest every day, even as the altcoin continued to trade at the $0.51 level. Though the price has dropped over 20% in the past week, DOGE’s concentration by large HODLers is nearly the same, at 65% based on on-chain data from intotheblock.

The increased demand for memecoins with high short-term ROI and volatility is met by an increase in the number of memecoins. WOOFY, SHIB, ELON among others clocked double-digit ROI before a price drop.

Currently, Ethereum’s rally alongside top altcoins is the key factor ushering in a new alt season with memecoins in the top 100 based on market capitalization. Bitcoin continues to remain rangebound at the $50000 level and DeFi tokens are rallying alongside altcoins.

Why the memecoin rally is taking an interesting turn

Top 5 MEMEcoins based on market capitalization || Source: Coinmarketcap.com

Among the top 25 altcoins based on market capitalization, barring a handful, altcoins have low volatility and are largely rangebound. Most of the top altcoins that offered high returns in the past 4 weeks are now consolidating. MATIC (+139%), ADA (+42%), DOT (14%), XLM (14%), these altcoins have offered double-digit returns in the past week.

This could be a factor driving traders towards memecoins, with a shorter turnaround time on ROI. Memecoins are ideal for traders looking to exit positions within hours, or days of buying. Currently, traders’ sentiment on DOGE is bearish; however, for other memecoins, it is neutral or bullish.

This is anticipated to be further bullish following the increase in trade volume and further exchange listings of memecoins. Current trade volume is a metric that signals a long-term bearish impact; however, despite a drop in this metric, memecoins are resisting a cascading sell-off.

Further, it is likely that accumulation is ongoing for memecoins, based on sentiment of crypto Twitter influencers and google search trends. Google search trend for DOGE is up every few days, just as it is for other memecoins.

Why the memecoin rally is taking an interesting turn

Search for Dogecoin || Source: Google Trends

The inflow of funds to memecoins hasn’t dropped, and the price is expected to recover based on on-chain metrics and demand. Since the concentration by large HODLers is directly linked to volatility for most altcoins, the current phase of consolidation is likely to be followed by accumulation and the rally. This is an interesting turn of events in the current alt season.


Sign Up For Our Newsletter


Coinsmart. Beste Bitcoin-Börse in Europa
Source: https://ambcrypto.com/woofy-shib-elon-dogecoin-memecoins-are-ideal-for-traders-looking-to-make-this-move

Continue Reading

Blockchain

Elon Musk’s latest Dogecoin ‘trolling’ isn’t impressing the crypto community

Republished by Plato

Published

on

Tesla and SpaceX CEO Elon Musk argued on Twitter today that Dogecoin (DOGE) can beat Bitcoin (BTC) “hands down,” with just one small condition—almost every DOGE’s fundamental aspect needs to change, effectively turning it into a different token altogether.

So no big deal then.

“Ideally, Doge speeds up block time 10X, increases block size 10X & drops fee 100X. Then it wins hands down,” Musk replied to a Twitter user who was arguing that “Elon is choosing $DOGE because Dogecoin is better than Bitcoin in many fundamental ways.”

Judging by the community’s reaction, a lot of users were left feeling unsure whether Musk was “trolling” or not. One commenter pointed out that if Dogecoin’s blockchain would produce 10-megabyte blocks every six seconds, this will make the network vulnerable to spam attacks.

“For those bad at math. 100X higher transaction volume with 100X lower fees means total fees earned stay same. Low fees & high volume are needed to become currency of Earth,” Musk retorted.

When asked why he won’t just make a completely new cryptocurrency that can satisfy these technical requirements, Musk explained that it’s a “big pain in the neck to create another one.” Still, he implied that this is also a possibility, but “only if Doge can’t do it.”

In his turn, Adam Back, CEO of Bitcoin development firm Blockstream, questioned Musk’s blockchain expertise in general.

“That’s not how any of this works, Elon Musk. Would be like someone wading into SpaceX with ideas for a cuboid rocket fueled by water,” Back wrote, adding, “He’s just trolling. And probably hitting a blunt.”

Other users were less lenient, arguing that if “Donald Trump has been banned for ‘being bad’ for people,” there is no reason why Musk “should keep having this privilege.”

In general, many commenters pointed out that for a blockchain network to drastically increase its throughput and scalability, it needs to make compromises in other areas such as security and decentralization. 

“Have you tried making your spaceships 10x lighter, and 10x faster, and also 10x bigger? This would ideally save on energy and efficiency,” another user ironically asked Musk.

In the end, regardless of whether Musk was actually joking or not, his behavior on Twitter—especially when it comes to cryptocurrencies—has been a bit over the top lately, some commenters argued.

“Because [Musk] has millions of newcomer users who may not know the difference. Funny trolling to him = rekt newbs in real-life,” Back concluded.

Get an edge on the cryptoasset market

Access more crypto insights and context in every article as a paid member of CryptoSlate Edge.

On-chain analysis

Price snapshots

More context

Join now for $19/month Explore all benefits

Like what you see? Subscribe for updates.

Coinsmart. Beste Bitcoin-Börse in Europa
Source: https://cryptoslate.com/elon-musks-latest-dogecoin-trolling-isnt-impressing-the-crypto-community/

Continue Reading

Blockchain

Bitcoin Hashrate of Major Chinese Mining Pools Drops Rapidly

Republished by Plato

Published

on

advertisement
Pointpay


Bitcoin network’s hashrate recorded a rapid drop today across major Chinese mining pools including f2pool losing 11.26% a spool lost 16.23%, Binancepool recorded a decline of 14.38%, and Huobipool lost 23.68%. The rapid decline is being attributed to another power outage in Sichuan province. Industry insiders claimed the decline might be temporary and might bounce back soon.

advertisement

Merchant Token

The decline in the mining pool’s hashrate comes days after the Bitcoin network’s mining hash power reached a new ATH. Bitcoin price on the other hand continued to consolidate under $50K. The top cryptocurrency saw a major sell-off a few days ago amid growing inflow on exchanges aided by Elon Musk-led Bitcoin network’s environmental impact FUD.

Bitcoin has been in a consolidation phase for over a month now after reaching a new ATH of $64,837, it recorded a sharp correction soon after falling over 20%. The recent sell-off was attributed to several factors including declining institutional interest.

advertisement

Will Bitcoin Price Suffer?

A similar power outage in China last month saw the Bitcoin mining hash rate drop by over 25% leading to another major market sell-off. The last hashpower fud was also marred into a lot of controversies as many claimed different reasons for the power outage and the amount of hash power decline.

Bitcoin price is currently trading just under the $49K mark with a 2% decline over the past 24 hours. With every major sell-off in the market, many have called it a short-term price top, but on most occasions, bitcoin has defied the odds to bounce back to new ATHs. On the other hand, Bitcoin adoption has continued to flourish as many public companies have announced Bitcoin purchases over the past month. Apart from Bitcoin, manor altcoins including ethereum, Litecoin have also registered a minor decline falling over 5% in the past 24 hours.

To keep track of Crypto updates in real time, Follow us on Twitter & Telegram.

Disclaimer
The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.
About Author
An engineering graduate, Prashant focuses on UK and Indian markets. As a crypto-journalist, his interests lie in blockchain technology adoption across emerging economies.

Handpicked Stories

Coinsmart. Beste Bitcoin-Börse in Europa
Source: https://coingape.com/bitcoin-hashrate-major-chinese-mining-pools-drops-rapidly/

Continue Reading
Blockchain5 days ago

Palantir Accepts Bitcoin for Payments and Considers Adding BTC to Balance Sheet

Blockchain4 days ago

Billionaire Druckenmiller says ledger-based system could replace USD worldwide

Blockchain5 days ago

Bitcoin Vault inks major deal with ESE to co-produce Gaming & Esports Talent Show in five countries

Blockchain5 days ago

XRP Lawsuit ramifications: Is the SEC hurting the same community it vows to protect?

Blockchain4 days ago

First Spot: Coinbase’s App Surpassed TikTok, Instagram, and Facebook on iOS in the US

Blockchain4 days ago

Raze Network Kicks Off Testnet Phase With UI Community Voting

Blockchain4 days ago

dotmoovs Raises $840,000 From Strategic Investors and Partners

Blockchain5 days ago

The challenges with designing a CBDC, explained

Blockchain4 days ago

How did Internet Computer (ICP) become a top-10 cryptocurrency overnight?

Blockchain5 days ago

Block.one and partners raise $10B to launch EOS-based crypto exchange: Bullish Global

Blockchain4 days ago

Casper Network’s CSPR Spot Trading Now Open on OKEx

Blockchain4 days ago

When dollars meet the hype: The biggest NFT hits from celebrities

Blockchain4 days ago

PARSIQ Integrated Into Polkadot For Smart Triggers Across the Relay Chain

Blockchain3 days ago

US Investment Bank Cowen to Offer Crypto Custody Services

Blockchain4 days ago

Uniswap flips Bitcoin on daily revenue… and it’s more impressive than you think

Blockchain5 days ago

Polkadot, Cosmos, Bitcoin Cash Price Analysis: 11 May

Blockchain4 days ago

DeFi lending platform Aave reveals “private pool” for institutions

Blockchain4 days ago

From cypherpunk to state contracts: the changing face of blockchain

Blockchain4 days ago

TA: Ethereum Overcame Odds With New High, Here’s Why ETH Could Test $4.5K

Blockchain5 days ago

eBay Now Allows the Sale of NFTs on its Platform

Trending