Market Insights

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

Summary

• Bitcoin (BTC) surged more than 10 percent for the second consecutive week as BTC options began trading on CME (CME).
• Altcoins including Ethereum (ETH) and Litecoin (LTC) gained sharply as demand for cryptocurrencies seemed to widen.
• Bitcoin Satoshi Version (BSV) more than doubled on the week amidst a flurry of speculation.

Market trends this week

BTC rallied hard in the last week to reclaim $8,500. It was the second straight week of double-digit gains. Bulls retook control of the market as BTC options launched on CME. Since December, industry exchanges such as Bakkt, OKEX, and FTX have begun offering similar services, but CME is the first major U.S. futures exchange to do so.

BSV more than doubled this week amid unconfirmed rumors that advocate Craig Wright obtained private keys to a wallet with millions of BTC. BSV is a fork of Bitcoin Cash (BCH) created due to a conflict with the BCH community. BCH also surged on the speculation.

On the macro front, tensions between the U.S and Iran cooled, especially after the accidental downing of a Ukrainian airline triggered protests in Tehran.

This Week’s Topics

• International Monetary Fund Chief Economist Gita Gopinath thinks that cryptocurrencies have potential, but lack the infrastructure to replace the U.S. dollar. (1/10)
• Christine Lagarde of the European Central Bank ECB pledges efforts to develop a digital currency, but says those efforts shouldn’t hinder initiatives in the private sector. (1/10)
• Binance pledges $1 million worth of cryptocurrency to help fight wildfires in Australia. (1/10)
• Crypto-exchange operator Kraken said that law-enforcement requests for user data has expanded exponentially each year. (1/10)
• Bank of Mitsubishi rolls out a blockchain-based system allowing letters of credit to be issued 80 percent faster. (1/9)
• Japan’s Financial Services Agency (FSA) is tightening rules on margin trading in cryptocurrencies. (1/10)
• The European Union begins implementing a new anti-money laundering rule known as 5AMLD. For the first time, crypto-service firms such as virtual-fiat exchanges and custodian-wallet providers will be covered. (1/10)
• Facebook (FB) CEO Mark Zuckerberg says the social-media giant wants to focus on commerce and payment tools over the next decade. (1/11)
• Analysts from Bloomberg predict BTC will rise to $14,000 this year, citing global uncertainty and the fixed supply of BTC. (1/11)
• More than 10 million BTC have remained dormant in accounts for more than a year, the most since 2017. (1/13)
• Seven Bank is among investors in the Lightnet, a blockchain-based mobile money-transfer service based in Thailand. (1/14)
• Digital-signature platform Off-Blocks will open a public authentication tool based on technology used by the U.S. government. It’s based on the Factom blockchain. (1/15)
• BTC rises to a two-month high as options begin trading on CME. (1/14)
• CME options traded 55 contracts in their first session, representing more than $2.3 million of notional value. (1/15)
• Rumors circulate about the potential creation of a Yen-linked stablecoin from Line (LN) after the company seeks trademark protection for “Line Yen.” (1/14)
• MoneyGram (MGI) partners with Ebix (EBIX) to handle remittances into India. MGI was already working with Ripple (XRP). (1/15)
• The United Nations has warned that attending North Korea’s crypto conference in February likely violates international sanctions. (1/16)
• U.S-based crypto exchange Kraken expands into Asia Pacific by acquiring Australia’s Bit Trade. (1/16)

Next Week’s Market Forecast

BTC has begun the year with a strong move. Market participants will watch for signs of the momentum continuing, or prices consolidating. Tensions in the Middle East have helped fuel trading volumes so far in 2019.

Aside from prices moving too far too fast, there is little reason at this time to expect a significant drop in BTC. Stagnating hash rates, a major concern toward the end of last year, have reversed course and are now at their highest levels.

Other potential catalysts include global equities markets and the Middle East. Traders should watch the $9,100 level as resistance and roughly $8,000 as support.

Next Week’s Topics

• 1/20-21: European Blockchain Convention in Barcelona.

Note: Equities and Futures accounts are offered by TradeStation Securities, Inc. Crypto accounts are offered by TradeStation Crypto, Inc.

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