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) dropped 12 percent on the week as coronavirus fears swept financial markets.
• BTC’s support is now around $8,400 while resistance is near $9,000.

Market Trends This Week

Equity and crypto markets fell sharply in the last week as coronavirus spread beyond China. Most cases were previously contained to China. With new cases appearing in several countries across the globe, market participants are taking a much more cautious stance.

Another negative was a report on Wednesday that the U.S. Securities and Exchange Commission rejected a BTC exchange-traded fund (ETF).

This Week’s Topics

• South Korean startup Contents Protocol will return $7.5 million of Ethereum (ETH) raised in an ICO and shut down after its business failed to establish itself. (2/21)
• Sweden’s central bank has begun testing a mobile app for depositing and withdrawing money from banks through digital wallets. It’s a step toward launching the world’s first central bank digital currency. (2/21)
• Bitcoin (BTC) volatility versus the U.S dollar reaches the highest level in three months. (2/21)
• Italian soccer team Juventus issues digital cards for star players in the blockchain-based game “Sorare.” (2/21)
• Mizuho Financial experiments with issuing “digital bonds for individuals” utilizing blockchain technology. (2/21)
• Digital-commerce giant Shopify (SHOP) has joined Facebook’s (FB) Libra association. (2/22)
• South Korea’s central bank considers building a blockchain-based system to improve record keeping in the bond market. (2/23)
• The European Union says it lacks sufficient information to determine Libra’s legal and regulatory status. (2/24)
• Japanese Finance Minister Taro Aso will discuss digital currencies at next month’s G20 meeting. (2/24)
• Coincheck adds support of the cryptocurrency Qtum (QTUM). (2/25)
• The 30-day historical volatility on West Texas Intermediate crude oil (@CL) rises above BTC’s. (2/25)
• Kraken researchers note that the number of large investors holding BTC increased in late January. That’s historically associated with greater volatility. (2/26)
• Ultimate Fighting Championship (UFC) signed a deal with Dapper Labs, creator of CryptoKitties, to let trade collectibles over the blockchain. (2/26)
• The SEC rejects a Bitcoin ETF’s proposal from Wilshire Phoenix and NYSE Arca. (2/26)
• The Bank of Canada says there is no significant need to issue a central bank digital currency at this time. (2/27)

Next Week’s Market Forecast

Cryptocurrencies face uncertainty with global markets under pressure and economic disruptions growing.

While sellers have dominated this week, BTC is coming off a multi-month rally and is now testing a large support area. Traders will be looking to see whether there’s demand for cryptocurrencies in coming weeks.

Next Week’s Topics

• 3/2-6: Hong Kong Blockchain Week 2020
• 3/3-5: Ethereum Community Conference 3 in Paris
• 3/7-8: MIT Bitcoin Expo 2020 held in Cambridge, Massachusetts

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