Crypto Prices Surge - Is Another Bull Run Coming?
Throughout the latter half of 2019, cryptocurrency markets had shown signs of weakness, as the flagship Bitcoin, touched below the psychological support of $7,000, and other cryptos soon followed in a steady downtrend.
But as they say, the past is past, and 2020 has started off strong for cryptos, as we've seen both Bitcoin, and altcoins go from strength to strength. Today however, on January 15th of the year 2020, cryptocurrency prices have really shown their colours, capping off a week of strong momentum.
Credits to: GIPHY
A summary of what happened.
Cryptocurrency markets have opened in the green, so here's a quick rundown of the main players, all presented for you in a neat little chart:
Coins | 24 Change (%) | Current Price ($)
-
| - | - | Bitcoin (BTC) | +4% | $8,800.00 Ethereum (ETH) | +11% | $165.95 Litecoin (LTC) | +11% | $58.27 Ripple (XRP) | +11% | $0.238 Dash (DASH) | +55% | $118.94 Bitcoin SV (BSV) | +90% | $349.00
Credits to: Coin360
As a result, we're seeing cryptocurrency's total market cap reach a 2-month high of $240 billion.
Credits to: CoinMarketCap
What caused it?
Among the prime movers for crypto prices, mainly Bitcoin and Dash, was associated with a recent internet outage in Venezuela by its state-run internet service provider. This appears to be an act of government censorship, as the South American country's National Assembly is moving ahead with a leadership vote, according to news sources.
Credits to: Twitter - NetBlocks.org
In case you didn't know, Venezuela has for the past few years been plagued by economic malaise, which was no doubt exacerbated by a hyperinflation of the Bolivar currency, and certainly not helped by government corruption, and mismanagement at the highest level.
As such, the Venezuelan people have turned to cryptocurrencies to secure their future, by providing a natural solution to these problems. As a result, crypto prices have traded at a premium in the country, based on LocalBitcoins data.
The 4H charts for Bitcoin (L) and Dash (R), with Dash showing a noticible gain from January 10th.
Credits to: TradingView
The two particular favourites in Venezuela, are Bitcoin and Dash, and the adoption rate is rising primarily due to the retail connections in the country, following Burger King's decision to accept Dash as a form of payment for its Venezuelan outlets.
Coincidentally, the recent internet outage may have prompted Venezuelans to rush into trading for more cryptos, and given that internet access has been irregular since, the trading may have been concentrated enough to push market prices higher overall.
A chart showing the high uptick of Bitcoin trading volume in Venezuela, using the LocalBitcoins P2P exchange. The timing of the surge in volumes coincide with the internet outages.
Credits to: Coin Dance
Now we turn towards the star of cryptocurrency's renewed surge - Bitcoin Satoshi Vision, or Bitcoin SV. It was formed out of a hard fork against Bitcoin Cash, undertaken by Craig Wright. BSV was conceived to follow along the true principles of cryptocurrency, as laid out by Satoshi Nakamoto, the writer of a white paper which would later spawn Bitcoin, and a personality which Mr. Wright has controversially claimed to be.
If Dash's chart wasn't ridiculous enough, here's BSV's recent surge, although there has been some correction since.
Credits to: TradingView
Nevertheless, Mr. Wright purportedly has some interesting news, and its this anticipation which may have led to BSV's ridiculous +300% weekly surge. At the centre of this "news" is concerning a legal battle between Craig Wright, and his late business partner, David Kleiman, which together formed the basis of the Tulip Trust.
Back when mining Bitcoin was easy, and any computer hardware could do it, Mr. Wright and Mr. Kleiman had apparently mined quite a lot of them, which now amasses to a tune of 1.1 million Bitcoins in the Tulip Trust, with a grand total of $9.6 billion dollars today.
After Mr. Kleiman had passed away, 50% of the holdings which should've been owed to him by the Trust never came. Now, Craig Wright apparently has access to those "lost" billions. Whether he plans to do anything about it, that will likely be a surprise for another day, as there surfaces accusations that BSV's recent surge was possibly an exit scam.
On another unrelated note, Bitwise Management has decided to withdraw its Bitcoin ETF application with the SEC. Long story short, their ETF application was filed on January 2019, only to be rejected on October, and to then have the SEC reconsider their decision a month later.
There's been arguments over the effects and practicality of a Bitcoin ETF, and Bitwise has been a proponent for it, having pushed against the odds countless times, despite scepticism from regulators, and the market. It seemed however, as with most previous ETF announcements, the revelation didn't come as a shock to traders and investors, and Bitcoin's price action hasn't budged as a result.
What to look forward to.
Bitcoin's modest rise comes as we're 118 days away from halving, a hugely anticipated moment as many investors and traders are expecting BTC prices to skyrocket as a result. With renewed institutional interest in Bitcoin, following CME's rather celebrated launch of Bitcoin Futures Options, a diminishing supply could herald new all-time highs, though let's not get caught up in the hype.
We're seeing increased institutional demand, as seen with rising Trading Volumes, and Open Interest on BTC Futures markets - CME (L), and Bakkt (R)
Credits to: Skew
Bitcoin's price had broken past the illusive $8,200 resistance point only a few days ago, and it has since gotten as high up as $8,900 on certain exchanges. With Bitcoin flirting against the $9,000 region, the current momentum signals that it there's potential for Bitcoin to break it in the coming days.
We've also seen a reversal of Longs and Shorts contracts on Bitfinex, which perhaps soothes concerns over any long-squeeze. That said, while the recent Bitcoin surge is being moved by real momentum, there is some potential for a minor pullback to the $8,200 region before chasing $9,000 once again.
An interesting change between BTC Long (L), and Short Contracts (R), on Bitfinex.
Credits to: TradingView
Cryptocurrency's No.2, Ethereum, has also risen alongside Bitcoin and friends. Analysts have long hoped for Ethereum to break past, and hold above the $145 resistance to solidify a long-term bullish case. Yet, with the recent market moves, it has pushed way past, going as high up as $170.
The key thing to look at with Ethereum, are the exciting things happening in the Decentralised Finance (DeFi) space, which in itself is an extension of Decentralised Applications (DApps). DeFi, as I've written about them before, aims to provide a new financial ecosystem, where all transactions and parties are decentralised, running atop the Ethereum network.
Credits to: TradingView
Large projects such as Compound Finance and MakerDAO are seeing greater adoption, and also attention from outside investors [1] [2]. They’re providing new and interesting ways to interact with the financial system, and it could put some momentum to push ETH to the $200 barrier soon.
And of course, how can I end this without mentioning our very own, favourite cryptocurrency, Steem. I have only joined this platform since around September 2019, and since then, it has been an enjoyable journey indeed, having met new peoples and learned new things.
Credits to: CoinMarketCap
Yet, throughout that time, the price of Steem hasn't yet changed much, hovering around the $0.14 mark when I started, and dipping to around $0.10 as cryptocurrency markets turned slightly bearish around late-November.
However, much has changed since, with Steem gaining renewed attention from the DApps which run on its blockchain, made popular by content creators migrating from mainstream platforms such as YouTube, following their mistaken censorship, as reported well by @jrcornel.
And now, as Steem trades as high as $0.16, the platform itself is prime for changes moving forward, as @midlet has covered, following new features such as "Communities", which is now in Beta. All in all, the next few weeks and months will be an interesting time for joining the Steem community, whether you're here to create content, or to consume it, with all sorts of social interactions such as videos, games, blogs, and etc.
Final Thoughts.
Credits to: GIPHY
Cryptocurrencies have evolved much in the past few years. I remembered back when I bought my first Bitcoin at $300, and I traded Ethereum at $10 each, on a chilly train-ride back from college, not too long ago.
With more adoption, and interest from big-name investors, 2020 is primed to be an interesting year for the growth of cryptocurrencies. If you're not into it yet, now would be a good time to start averaging in those cryptos.
Keep calm, and Hodl on!
