Robert Hernandez

Tuesday, 2 February 2021

Led by Uniswap, decentralized exchange volumes soared above $50B in January

Decentralized finance (DeFi) has emerged as one of the driving forces of crypto sector growth, and it is also establishing itself as an integral component driving widespread adoption of cryptocurrencies.

A recent report from Delphi Digital points out that there has been a 440% increase in “the circulating market cap of leading DEX protocols over the past 30 days,” which has also led to “the trading volume they facilitate to rise along with them.”

Circulating market cap of DEX protocols. Source: Delphi Digital

DEX volume in January 2020 set a new all-time high combined total above $55 billion, more than double the previous high of $26 billion in September 2020.

Uniswap currently dominates the field, with a total of $29.5 billion in volume in January, representing 45% of the volume traded by all DEXes, while its top competitor, SushiSwap, accounted for 22% of the total volume, with $12.2 billion transacted.

Monthly DEX trading volume. Source: Delphi Digital

The total value locked (TVL) on DEX platforms has also reached a new all-time high value of $9.948 billion as of Feb. 2, comprising 36% of the total $27.785 billion locked on all DeFi-related platforms.

Uniswap once again leads all DEXes in terms of TVL, with $3.18 billion locked on the protocol, while Curve DAO came in second with $2.97 billion, followed by SushiSwap, which has $2.34 billion.

Total value locked in DEXs. Source: DeFi Pulse

As discussed by Delphi Digital, both the Uniswap and SushiSwap protocols have built-in fee structures that allow tokenholders the opportunity to stake their UNI or SUSHI and earn rewards.

Incentives like these help to further promote the growth of DEXs and DeFi in general as decentralized protocols look to claim more of the available market share from centralized exchanges.

Title: Led by Uniswap, decentralized exchange volumes soared above $50B in January
Sourced From: cointelegraph.com/news/led-by-uniswap-decentralized-exchange-volumes-soared-above-50b-in-january
Published Date: Tue, 02 Feb 2021 20:15:00 +0000

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Led by Uniswap, decentralized exchange volumes soared above $50B in January
Led by Uniswap, decentralized exchange volumes soared above $50B in January was originally published here https://dailynwssheet.tumblr.com/post/642074944816250880

How low can Bitcoin price drop if BTC fails to retake $35K soon?

Bitcoin (BTC) has seen a turbulent past few days after Elon Musk showed support for the cryptocurrency amid the GameStop fiasco on the equity markets. However, since that tweet, Bitcoin’s price has been correcting after the entire push through Elon Musk was retraced.

Since then, Bitcoin’s price is facing a crucial hurdle at the $35,000–$35,200 area before an all-time high test. Once that area breaks and flips for support, continuation toward a new all-time high is likely.

Bitcoin doesn’t hold $35K and has to flip it for support

XBT/USD 3-hour chart. Source: TradingView

The three-hour chart shows a clear downtrend structure, with the “Elon Musk pump” outlier. This downward structure was established after the peak high at $42,000 earlier in the year.

This downtrend has seen lower highs and lower lows, which can be seen in the chart. Therefore, there is a good possibility that this downtrend will continue.

If BTC breaks the $35,000 barrier, the $38,000 resistance zone level should pose not much of a problem for the bulls. The next likely major area of resistance will be around $40,500.

On the other hand, if Bitcoin’s price can’t break through $35,000, a renewed retest of the $30,000 level is on the table. Given that the $30,000 level has seen many tests since the previous all-time high, there is a good chance that this level will be lost. In this case, an even further correction toward $25,000 to $26,000 is on the table.

21-week MA is currently acting at $21,000

BTC/USD 1-week chart. Source: TradingView

Once again, the only indicator to watch for any further correction is the 21-week moving average (MA). In the previous bull cycle, it provided sustainable support for the entire period.

If the market corrects further, however, a retest of the previous all-time high in 2017 remains unlikely. In other words, everybody and their mother will be buying there, so the market will likely not provide this opportunity.

Therefore, the likelihood of another further correction to $24,000 to $26,000 is still there, and this would also fill a CME gap alongside a test of the 21-eek MA.

However, such a correction depends on whether Bitcoin’s price can break through $35,000.

The bullish scenario for Bitcoin

XBT/USD 4-hour chart. Source: TradingView

This detailed chart and scenario show that the critical area is the $35,000 zone, which if broken, will open the door to new all-time highs.

That $38,000 zone may see some short-term consolidation. But since BTC has tested this once already, it is more likely to see resistance at $40,500. Therefore, if Bitcoin’s price breaks through the $35,000 area, continuation is expected to $40,500.

The bearish scenario for Bitcoin

XBT/USD 4-hour chart. Source: TradingView

The bearish scenario is also straightforward, with $35,000 holding as resistance for further downside.

The first support is the $32,000 area, which has been tested several times and will likely fail as support. The next area is found between $29,000 and $30,000, which has also been tested many times for support.

A renewed test and falling through this level would open up the door to $25,000. This would line up with the CME gap and the 21-week MA. Meanwhile, every previous support level is confirmed as resistance, with the correction continuing to set new lower highs and lower lows.

author and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk. You should conduct your own research when making a decision.

Title: How low can Bitcoin price drop if BTC fails to retake $35K soon?
Sourced From: cointelegraph.com/news/how-low-can-bitcoin-price-drop-if-btc-fails-to-retake-35k-soon
Published Date: Tue, 02 Feb 2021 15:09:00 +0000

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How low can Bitcoin price drop if BTC fails to retake $35K soon?
How low can Bitcoin price drop if BTC fails to retake $35K soon? was originally published here https://dailynwssheet.tumblr.com/post/642048537111166976

Corporate buy-ins could take Bitcoin price over $500K — report

Bitcoin (BTC) could fetch at least a $535,000 price tag if corporate buyers convert 10% of their cash reserves to the largest cryptocurrency.

In one of the various conclusions from its latest report, “Bitcoin: Preparing for Institutions,” investment firm Ark Invest said that even a 1% allocation from S&P 500 companies would be enough to increase BTC/USD spot prices by $40,000.

Minimum corporate BTC allocation: 2.55%

The findings come as institutional buyers continue to focus on Bitcoin as a long-term alternative to cash, with one transaction in particular drawing attention after $500 million left Coinbase.

“Based on search volumes compared to 2017, bitcoin’s price increase seems to be driven less by hype. With bitcoin appearing to gain more trust, some companies are considering it as cash on their balance sheets,” the report reads.

In terms of the longer-term impact that corporations could have on Bitcoin’s scarcity, Ark forecast that probable allocations would likely far outstrip the 1% level.

“Based on daily returns across asset classes during the past 10 years, our analysis suggests that allocations to bitcoin should range from 2.55% when minimizing volatility to 6.55% when maximizing returns,” it wrote, adding:

“Based on ARK’s simulated portfolio allocations, institutional allocations between 2.5% and 6.5% could impact bitcoin’s price by $200,000 to $500,000.”

Impact of corporate allocations on BTC/USD. Source: ARK

Deep-pockets narrative stays mainstream

Despite BTC price action failing to deliver a convincing continuation of its bull run in recent weeks, anticipation is building that the status quo will soon be turned on its head. As Cointelegraph reported, asset management giant Grayscale may provide the spark that reignites the market as soon as Wednesday.

“There is a large and emerging group of institutions that have an enormous capital base that are reallocating to this space,” Michael Bucella, general partner at fellow investment firm BlockTower Capital, told CNBC this week.

“And if you think about the supply-demand model of a commodity, the supply curve is declining over time to effectively zero, and the demand is increasing exponentially.”

On Feb. 8, meanwhile, the largest altcoin, Ether (ETH), will join Bitcoin in seeing dedicated futures markets go live from CME Group.

Title: Corporate buy-ins could take Bitcoin price over $500K — report
Sourced From: cointelegraph.com/news/corporate-buy-ins-could-take-bitcoin-price-over-500k-report
Published Date: Tue, 02 Feb 2021 13:23:45 +0000

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Corporate buy-ins could take Bitcoin price over $500K — report
Corporate buy-ins could take Bitcoin price over $500K — report was originally published here https://dailynwssheet.tumblr.com/post/642025871803383808

Monday, 1 February 2021

CryptoQuant CEO says Coinbase Bitcoin outflows are a ‘bullish signal’

Recent Bitcoin (BTC) outflows from Coinbase are reminiscent of the “proof-of-keys” days and could be a sign of a bullish future, according to CryptoQuant CEO Ki Young Ju.

Data from the cryptocurrency analysis firm shows that more than 15,200 BTC, currently worth over $515 million, were withdrawn from Coinbase on Jan. 31.

BTC outflows from Coinbase. Source: CryptoQuant

According to Ki Young Ju, the withdrawal “went to custody wallets that only have in-going transactions,” and was likely an “OTC deal from institutional investors” based on several identifiers.

He also pointed to the fact that the split of a 15,000 BTC wallet into wallets containing 1,000-5,000 BTC increases security costs. Furthermore, most of the internal transfers are done with round amounts, like 1,000 to 5,000 Bitcoin, while this transfer included odd groupings of 1,265, 2,391, and 1,957 BTC.

As to why Coinbase outflows are a bullish sign for the top cryptocurrency, Ki Young Ju linked to a previous tweet from Dec. 18 which states that “if Coinbase moves a significant amount of Bitcoins to other cold wallets, it indicates OTC deals” which are non-exchange transactions.

He said:

“Since the price is eventually determined on exchanges, massive non-exchange transaction volume is considered as a bullish signal. These transactions include OTC deals.”

BTC/USDT 4-hour chart. Source: TradingView

The slow inflow of institutions into the cryptocurrency sector is helping to increase the legitimacy of the crypto sector as a whole and appears to be providing a certain level of support for the price of BTC as the available supply continues to be locked away in cold custodial wallets.

While the media were pointing to Bitcoin’s price drop from $42,000 to below $30,000 as a sign that the BTC bubble had popped once again, the purchase of 4,000 BTC on Feb.1 indicates that institutions have instead seen this as an opportunity to buy the dip and are taking full advantage of this buying opportunity.

Title: CryptoQuant CEO says Coinbase Bitcoin outflows are a ‘bullish signal’
Sourced From: cointelegraph.com/news/cryptoquant-ceo-says-coinbase-bitcoin-outflows-are-a-bullish-signal
Published Date: Tue, 02 Feb 2021 00:15:00 +0000

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CryptoQuant CEO says Coinbase Bitcoin outflows are a ‘bullish signal’
CryptoQuant CEO says Coinbase Bitcoin outflows are a ‘bullish signal’ was originally published here https://dailynwssheet.tumblr.com/post/641980572727689216

What short squeeze? Here’s what is really behind XRP’s recent 170% rally

Between Jan. 30 and the early hours of Feb. 1, XRP price pumped 147%, reaching $0.76 which is its highest level in two months. The move seems to have been fueled by r/Satoshistreetbets, an off-shoot of r/Wallstreetbets.

It seems that speculative social media group-based investing is becoming a trend so let’s take a look at what triggers might have catalyzed the recent surge in XRP price.

XRP Twitter activity vs. Price. Source: TheTie

Data from TheTie, an alternative data provider focused on social analytics, shows just how significant the impact of active Twitter users has been on XRP price.

Even Gene Simmons, the legendary musician from the rock band, KISS, told his nearly 900,000 followers:

“Not recommending any of these to anyone. But yes, I also bought Dogecoin, XRP, and others. Make of it what you will.”

Was there short interest behind this move?

Knowing exactly what triggered the investors to crowd into XRP could uncover a set of criteria that may apply to other cryptocurrencies.

Hedge funds with sizeable short positions are what drew investors to GameStop and AMC stock. By coordinating a pump on these companies, buyers knew that would force short sellers to be liquidated and trigger the start of a strong rally.

Taking a look at Bitfinex’s long-to-short ratio shows that there’s currently $124 million total margin trades combining its USD and BTC based markets. Although that figure is up from $95 million a month ago, it’s more important to focus on the percentage favoring shorts.

XRP Longs vs. Shorts. Source: Bitfinex

The ratio seen on Jan. 29 favored longs by 180%, and this is the opposite of what’s necessary for a short squeeze. Moreover, in nominal terms, those $25 million margin shorts were not significant to XRP’s $1.55 billion average daily volume.

On the other hand, futures markets held a $277 million open interest, which is flat from the previous month. But unlike margin markets, buyers and sellers are matched at all times.

XRP aggregate futures open interest. Source: Bybt.com

As depicted above, despite the liquidations caused by the recent 147% rally, XRP’s open interest surged in nominal terms due to its price appreciation. To understand whether those traders had been using excess leverage on either side, one should focus on the futures contracts funding rate.

When sellers (shorts) are the ones demanding more leverage, the funding rate goes negative. Therefore, those traders will be the ones paying up the fees.

XRP aggregate futures open interest. Source: Bybt.com

As shown above, buyers had been using more leverage. Albeit relatively steady over the past 30 days, the last time negative funding rates occurred was Dec. 24 and Dec. 29. Both dates mark local lows after substantial price corrections caused by the SEC lawsuit against XRP.

Therefore, it is safe to assume that r/Satoshibets did not pick XRP based on margin shorts nor futures leveraged trades.

Apart from being a sub-$10 coin, XRP was one of the most distant from its all-time high. It’s also important to consider that before its recent 1,000% pump, Dogecoin (DOGE) was also trading 90% below its $0.078 all-time high.

Sub-$10 coins. Source: Livecoinwatch.com

While it is indisputable that social investing groups have played some role in the recent rallies seen from Dogecoin, XRP, GameStop and AMC, the data do not validify the narrative that r/Satoshistreetbets chose to pump XRP because of the high level of shorts on the altcoin.

com. Every investment and trading move involves risk, you should conduct your own research when making a decision.

Title: What short squeeze? Here’s what is really behind XRP’s recent 170% rally
Sourced From: cointelegraph.com/news/what-short-squeeze-here-s-what-is-really-behind-xrp-s-recent-170-rally
Published Date: Mon, 01 Feb 2021 18:59:12 +0000

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What short squeeze? Here’s what is really behind XRP’s recent 170% rally
What short squeeze? Here’s what is really behind XRP’s recent 170% rally was originally published here https://dailynwssheet.tumblr.com/post/641957940059947008

Reddit rage as XRP price crashes 50% hours after hitting two-week highs

Reddit rage as XRP price crashes 50% hours after hitting two-week highs
Reddit rage as XRP price crashes 50% hours after hitting two-week highs

XRP, the number-four cryptocurrency by market capitalization, crashed nearly 50% in under two hours on Feb. 1 as a trading frenzy backfired on new investors.

XRP/USD 1-hour candle chart (Bitstamp). Source: TradingView

XRP traders nurse 48% losses

Data from Cointelegraph Markets and TradingView showed that extreme volatility set in for XRP/USD during Monday trading, hours after now-infamous Reddit group r/Wallstreetbets opted to buy the token en masse.

After reaching highs of $0.75, losses began mounting fast, the downside accelerating until XRP bounced off lows of $0.39 — 48% beneath the top.

At the time of writing, XRP/USD traded at around $0.45, with large swings still commonplace on low time frames. The social daily sentiment score has also reached levels not seen since January 2018, according to data from The Tie.

XRP daily sentiment score. Source: The Tie

Responding, critics of the controversial altcoin were first to issue warnings over what they saw as the pitfalls of investing in it over Bitcoin (BTC) for short-term trading.

“Even though the $XRP army get aggressive when you warm them about the escrow shaped elephant in the room, I still can’t help but feel sorry for those that bought at 0.75c today. X R (I)P,” regular Cointelegraph Markets’ contributor Keith Wareing summarized on Twitter.

DOGE holds ont

Previously, XRP had been on a different downtrend as a result of legal action against Ripple, the blockchain payment network th constitutes its largest investor. The rebound had delighted other fans, who had watched as the coin hit lows of under $0.16 just weeks ago.

Meanwhile, XRP was not the only target of Reddit traders on the day, with Dogecoin (DOGE) and silver seeing huge increases.

At the time of writing, DOGE/USD was holding on to its gains, which had taken it to near $0.04. A mention from Elon Musk in an interview late on Sunday singling it out among other altcoins had buoyed sentiment among fans of the meme-based altcoin.

By contrast, as Cointelegraph reported, little action was present on Bitcoin spot markets, with the closest bullish support at $34,000 yet to be realized.

Title: Reddit rage as XRP price crashes 50% hours after hitting two-week highs
Sourced From: cointelegraph.com/news/reddit-rage-as-xrp-price-crashes-50-hours-after-hitting-two-week-highs
Published Date: Mon, 01 Feb 2021 14:28:04 +0000

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Reddit rage as XRP price crashes 50% hours after hitting two-week highs
Reddit rage as XRP price crashes 50% hours after hitting two-week highs was originally published here https://dailynwssheet.tumblr.com/post/641935279914139648

Elon Musk: Bitcoin is on the verge of seeing broader acceptance by finance

Bitcoin (BTC) is on the verge of seeing broader acceptance, Elon Musk, the CEO of Tesla, said in a Clubhouse conversation on Feb. 1.

Clubhouse is an exclusive audio chat social media platform that is invite-only. Members can join various conversations, akin to an online private conference.

“I am late to the party but I am a supporter of #Bitcoin.” – Elon Musk

— Dan Held (@danheld) February 1, 2021

Elon Musk publicly comments about Bitcoin

During the conversation with Andressen Horowitz and other prominent investors, Musk was asked about his thoughts on Bitcoin.

On Jan. 29, Musk put the word “Bitcoin” in his Twitter bio, causing the price of BTC to rally by more than 14% in 30 minutes.

After the occurrence, Bitcoin investors and enthusiasts were highly anticipating positive comments about crypto, in general, from Musk.

When asked about Bitcoin, Musk said according to industry executives who were able to listen to the chat:

“I do think Bitcoin is a good thing. I’m a supporter of Bitcoin. I think Bitcoin is on the verge of getting broad acceptance by conventional finance.”

Industry executives were generally positive about Musk’s comment on Bitcoin. James Todar, a partner at Greymatter Capital, said:

“One of the most forward thinking inventors of our age missed bitcoin. On Clubhouse just now, @elonmusk tells of a friend who gave him a cake in the shape of a bitcoin back in 2013. Despite being ‘late to the party’ Elon thinks bitcoin is on the verge of acceptance in finance.”

Dan Tapiero, a partner at 10T Holdings, shared a similar sentiment. He said that the richest man in the world being a Bitcoin supporter “feels good.” Tapiero wrote:

“Somehow it feels good that @elonmusk , a #Bitcoin supporter near my age is the richest man in the world. Was getting tired of Gates/Buffett/Bezos…older guys in old tech or no tech and not bitcoiners. With an iconoclast and a visionary as example maybe there is hope for Gen Z.”

As Cointelegraph reported, prominent Bitcoin investors such as billionaire Tim Draper have been asking Musk and his businesses such as Tesla to accept BTC directly, which would give Bitcoin a massive boost in global awareness.

So why did Bitcoin drop instead?

The price of Bitcoin pulled back by around 3% immediately after Musk commented about the dominant cryptocurrency.

BTC/USD 1-hour candle chart (Bitstamp). Source: Tradingview.com

There are two reasons why the price of Bitcoin might have dropped after Elon talked about Bitcoin. First, some may have anticipated Musk to disclose his Bitcoin holdings.

Second, the market might have reacted with a sell-the-news response, as the minor pullback occurred merely minutes after Musk’s comments were publicized.

As Cointelegraph reported, the price of Bitcoin has been showing weakness since the “Elon pump” to $38,000 on Friday. Traders are now closely watching technical resistance at $34,500 and $35,000 that must be broken to avoid more downside in the short term.

Title: Elon Musk: Bitcoin is on the verge of seeing broader acceptance by finance
Sourced From: cointelegraph.com/news/elon-musk-bitcoin-is-on-the-verge-of-seeing-broader-acceptance-by-finance
Published Date: Mon, 01 Feb 2021 07:38:15 +0000

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Elon Musk: Bitcoin is on the verge of seeing broader acceptance by finance
Elon Musk: Bitcoin is on the verge of seeing broader acceptance by finance was originally published here https://dailynwssheet.tumblr.com/post/641916409303171072

Robert Hernandez

Tuesday, 2 February 2021

Led by Uniswap, decentralized exchange volumes soared above $50B in January

How low can Bitcoin price drop if BTC fails to retake $35K soon?

Bitcoin doesn’t hold $35K and has to flip it for support

21-week MA is currently acting at $21,000

The bullish scenario for Bitcoin

The bearish scenario for Bitcoin

Corporate buy-ins could take Bitcoin price over $500K — report

Minimum corporate BTC allocation: 2.55%

Deep-pockets narrative stays mainstream

Monday, 1 February 2021

CryptoQuant CEO says Coinbase Bitcoin outflows are a ‘bullish signal’

What short squeeze? Here’s what is really behind XRP’s recent 170% rally

Was there short interest behind this move?

Reddit rage as XRP price crashes 50% hours after hitting two-week highs

XRP traders nurse 48% losses

DOGE holds ont

Elon Musk: Bitcoin is on the verge of seeing broader acceptance by finance

Elon Musk publicly comments about Bitcoin

So why did Bitcoin drop instead?

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