Market Insights

This post is a translation of the weekly cryptocurrency analysis by Crypto Lab, a wholly owned subsidiary of Monex Group (Tokyo, Japan). Monex is the parent of TradeStation Group.

Summary

• Bitcoin (BTC) continued its strong bullish trend with a breakout above $10,000. Despite pulling back on Wednesday and Thursday, it still rose more than 10 percent on the week.
• Altcoins such as Ethereum (ETHUSD) continue to follow BTC.
• Will BTC take another attempt at $14,000 next week? We’re watching $10,000 as likely support for now.

Market Trends This Week

Bullish momentum continued, lifting BTC more than 35 percent at its highest level. Profit taking followed but it still had another positive week.

Binance’s recent decision to exclude altcoins from its services concentrated interest in BTC. Facebook’s (FB) Project Libra also received widespread publicity, spreading awareness of cryptocurrencies. The approval of Ledger X’s futures offering and short-covering were other catalysts.

Guidelines from the G20’s Financial Action Task Force (FATF) included stringent anti-money laundering steps as expected. That had little impact on market prices.

Topics This Week

• Japan’s Financial Services Agency (FSA) orders the FISCO virtual-currency exchange to improve operations. (6/21)
• FATF announces new guidelines on cryptocurrencies. (6/21)
• The FSA issues amendments to the administrative guidelines for exchanges. (6/21)
• Bloomberg reports crypto-mining company Bitmain may seek an initial public offering (IPO). (6/21)
• Remittance company SendFriend launches a service allowing payments from the U.S. using Ripple’s (XRP) xRapid software. (6/23)
• The Bank for International Settlements (BIS) publishes its annual economic report. (6/23)
• The U.S. House of Representatives’ Financial Services Committee announces it will hold a hearing on FB’s Project Libra after the Senate Banking Committee.
• Binance adds stablecoin USDSB, which is backed by its own version of StableUSD (USDS). (6/24)
• Remix Point invests in Daisy, a blockchain-related startup from Tokyo University. (6/25)
• The U.S. CFTC permits LedgerX to offer in-kind futures on BTC. (6/25)
• Bloomberg reports that JPMorgan Chase (JPM) will launch a pilot of its JPM Coin before the end of the year. (6/25)
• Japan Virtual Currency Exchange Association (JVCEA) starts soliciting public comments on self-regulatory rules. (6/25)
• Walmart China, affiliated with Wal-Mart Stores (WMT), launches a food-tracking platform using Vechain. (6/25)
• A letter from the Financial Stability Board (FSB) is sent to G20 leaders. (6/25)
• CNBC reports that cryptocurrency trading by institutional investors doubled or tripled over the last year. (6/25)
• Square (SQ) begins a Bitcoin-deposit service with its Cash App remittance program. (6/26)
• Chaintope starts demonstration experiments of drug distribution utilizing blockchain through its Malaysian subsidiary. (6/26)
• SBI announces seven Japanese banks will participate in the newly created SBI money tap. (6/27)
• Indian crypto exchange Koinex announces it will cease operations due to lack of bank support and regulations. (6/27)

Market Forecast for Next Week

BTC may remain firm amid profit taking and consolidation.

Global monetary easing and rising geopolitical risks surrounding the U.S. have reduced incentives to hold fiat money and traditional financial assets. That’s helped draw funds into cryptocurrencies. It also raises the stakes around this week’s G20 meeting in Osaka. Odds likely favor continued gains if current tensions continue. However a trade agreement between the Washington and Beijing could put downward pressure on blockchain assets.

We saw a sharp pullback on Wednesday and Thursday following the sharp gains. Still, a major collapse seems to be less of a risk because there isn’t nearly as much hype as in late 2017. Price action isn’t driven now by amateur investors, but by experienced professionals. This grounding of the industry, established over the last year, won’t disappear too quickly.

We’re still watching $10,000 as key support on BTC.

Next Week’s Topics

• 7/2-3: Asia Blockchain Summit 2019 to be held in Taiwan.
• 7/6: X Blockchain Meet-up to be held in Tokyo