Bitcoin (BTCUSD) is resuming its uptrend after spending the first 2 weeks of H219 consolidating in the ~7500-8500 range, with BTCUSD bulls now eyeing the next major psychologically key whole figure level of 10k. Although overbought on the weekly and daily Stochastics, the upsloping weekly MACD suggests any dip this week towards uptrend/ascending wedge support (on the daily chart) will quickly attract bulls. The odds are that any profittaking in the next few days will be even shallower, with the daily RSI rallying and daily MACD positively crossing.
Industry Fundamentals
Facebook is publishing its whitepaper on its stablecoin project (tentatively named “Libra”) June 18, and hiring aggressively as it accelerates its discussions with regulators, the largest US crypto exchanges, some of the world’s largest marketmakers – Jump and DRW. Key investors like Visa, Mastercard, Paypal and Uber have injected USD 10M each to serve as collateral in the form of a basket of fiat currencies for the stablecoin. The objective is to partner with 100 investors (from a variety of industries, including telecom, media, e-commerce) of USD 10M each with each managing its own node.
Fidelity’s institutional crypto trading offering is currently available (or in testing) for select clients, with retail brokerage giants Etrade and TD Ameritrade also preparing to launch trading in a few top coins. The market is increasingly shrugging off the fears around Bitfinex covering up losses with funds earmarked for backing Tether (USDT), especially as it has apparently already received commitments for USD 1B in its current raise to offset funds frozen by US, Polish and Portuguese authorities. With liquidity on USDT significantly higher than newer, competing USD-backed, audited stable coins due not in small part to USDT enjoying first mover advantage and the network effects from having the longest established history, the market appears to be largely sticking with using USDT which is listed on more crypto exchanges and offers superior liquidity. Longer term industry bulls are increasingly buying on dips as the sector overall gains interest from IBM’s use of Stellar Lumens and a USD stablecoin as part of the World Wire blockchain network for regulated financial institutions (announced in March). Ongoing anticipation is building for the coins being developed by leading messenger apps (i.e. Facebook/Whatsapp/Instagram, Line, Kakao) and banks (i.e. JP Morgan, Mizuho, Bank of Tokyo-Mitsubishi UFJ). The launch of BAKKT has been delayed multiple times with no announced target go live date. A race continues to launch STO exchanges and consultancies ahead of increasingly regulatory clarity on STOs.
Bitcoin Fundamentals
BTCUSD bulls are anticipating the third Bitcoin block reward halving (which will reduce the amount of new BTC supply) May 2020 but which has historically (for the 2 other halving events) seen bull runs begin roughly 1 year in advance of the halving date. The Bitcoin blockchain itself continues to benefit from Lightning Network-related scalability improvements.
Check out more about today’s fundamental analysis recap on the crypto industry, as well as technical and fundamental analysis on Ethereum and Bitcoin here