Price Point: Bitcoin seemed unfazed by news from the Bank of England announcing its biggest rate hike in 27 years. The pound fell against the dollar.
Market Movements: Omkar Godbole looks at a rare signal that suggests Bitcoin may be at the bottom of the market and why this could be the best time to increase exposure to the cryptocurrency.
Chart of the day: The ether-to-bitcoin ratio breaks the 8-month bearish trendline.
This article originally appeared in First Mover, CoinDesk’s daily newsletter that puts the latest moves in the crypto markets into context. Subscribe to get it in your inbox every day.
cost point
There wasn’t much exciting news for Bitcoin (BTC) this week — a possible explanation for its six-day losing streak through Wednesday. But it doesn’t fall out of bed either. During the course of the slide, the notoriously volatile cryptocurrency lost only about 4%.
BTC seemed unfazed by the news that the Bank of England (BOE) hiked interest rates by half a percentage point on Thursday amid concerns that UK inflation will top 10% next year.
The bank raised its policy rate from 1.25% to 1.75%, the largest single move in more than a quarter century.
Sterling fell sharply against the dollar following the statement.
Ether (ETH) was also down 3% on the day, while other altcoins were all mostly in the red. Exceptions were Tezos, Fantom, and NEAR Protocol, all of which are up 2% over the past 24 hours.
Also, wealth management giant BlackRock has partnered with listed crypto exchange Coinbase to make crypto directly available to institutional investors.
Joint customers of Aladdin, Coinbase’s investment management platform and BlackRock, will have access to crypto trading, custody, prime brokerage and reporting capabilities, according to a blog post Thursday.
Saylor is fully focused on Bitcoin
MicroStrategy (MSTR) stock rose nearly 15% on Wednesday after it was announced the night before that Michael Saylor was stepping down as CEO to become executive chairman and focus solely on the company’s Bitcoin strategy.
A new report from blockchain analytics firm Chainalysis estimates that $2 billion worth of crypto has been siphoned off cross-chain bridges this year alone, including this week’s $190 million Nomad Bridge exploit. Dollar.
Developers behind the Solana blockchain say the closed-source Slope wallet may be responsible for this week’s ongoing exploit that has resulted in multimillion-dollar crypto tokens being stolen from more than 9,000 hot wallets became.
A crypto warning for Turkey
Finally, check out this opinion piece by Burak Tamac, senior researcher at CryptoQuant, and economist Erkan Oz on lessons learned from the Turkish government’s hasty attempt to regulate cryptocurrencies. The authors believe that the government’s views on crypto constitute a restriction on freedom and are not only ethically and constitutionally wrong, but would exacerbate rather than solve the country’s capital outflow problem.
Biggest Winners
There are no winners in CoinDesk 20 today.
Biggest Loser
| attachment | ticker | Returns | DACS sector | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| Solana | SOL | −4.2% | Smart Contract Platform | Gala | GALA | −3.6% | entertainment | avalanche | AVAX | −2.6% | Smart Contract Platform |
market movements
Rare signal suggesting Bitcoin price bottom comes from Omkar Godbole
Predicting a bear market bottom is like catching a falling knife. Despite this, traders often try to predict one based on how the price has behaved compared to critical indicators during previous bear runs. The assumption here is that history will repeat itself.
One such rare signal has surfaced, suggesting that Bitcoin’s decline may be leveling off and now is the best time to increase exposure to the cryptocurrency.
The Bitcoin Mining Difficulty Band, which includes short and long simple moving averages of mining difficulty, has tightened for the first time in over a year, indicating miner capitulation. Previous bear markets, including that of 2014, ended with band compression, data from analytics firm Glassnode shows.
“The Bitcoin Ribbon dataset has historically proven to be an optimal entry-level indicator, and I believe it will demonstrate its predictive power again this time around,” said Markus Thielen, chief investment officer at IDEG Asset Management (IDEG)-based in the British Virgin Islands in an email. “We are also entering the 18-month period leading up to the bitcoin halving (September 22nd) – a window when bitcoin prices have tended to boom.”
Miner capitulation occurs when those responsible for minting coins go out of business, resulting in a drop in hashrate and mining difficulty. This reduces selling pressure and allows for price stability and an eventual bull market revival. Miners often sell mined coins to fund operating costs, adding downward pressure on the market.
The band contains 9-, 14-, 25-, 40-, 60-, 90-, 128-, and 200-day simple moving averages of mining difficulty, a measure of how difficult it is to mine a block and transact into it Bitcoins verify blockchain.
Recently, several miners have surrendered to stay solvent. The mining difficulty is adjusted every two weeks. The number of participants in the mining network and their total mining power determine whether the difficulty is set lower or higher.
Read the full story here.Chart of the day: ETH/BTC breaks 8-month bearish trendlineBy Omkar Godbole
The breakout in the Ether-to-Bitcoin (ETH/BTC) ratio suggests that the eight-month bear market is over and suggests continued Ether outperformance.
Latest Headlines
BlackRock offers crypto to institutional investors through Coinbase Prime: The wealth management giant and crypto exchange have partnered to expand access to crypto among institutional investors.
Chainalysis Estimates $2 Billion Was Stolen This Year Through Cross-Chain Bridge Hacks: This week, hackers used a vulnerability on the Nomad Bridge to steal $190 million worth of crypto.
The Bank of England is raising interest rates to 1.75% – the biggest rise since 1995: at 1.75%, the interest rate is now the highest since the global financial crisis began in late 2008.
Gaming claimed to account for 60% of blockchain activity in July, reports DappRadar: DappRadar’s latest monthly report looked at trends in the blockchain gaming and NFT marketplace.
Miner Tomorrow Crypto To Go Public Through SPAC Merger: Proposed merger is expected to close in Q4 2022, subject to shareholder and regulatory approvals.
UK Parliamentary Group Launches Crypto Inquiry To Form Policy Recommendations: The cross-party group is asking industry experts, regulators and the government to comment on a range of issues including consumer protection and CBDCs.
PwC Crypto Head Departs to Establish $75M Digital Asset Fund in Dubai, The Financial Times reports: Henri Arslanian’s new fund, Nine Blocks Capital Management, has received preliminary regulatory approval in the Gulf city.
Fairfax County Pension Fund Invests $70M in Crypto Yield Farming Funds, the Financial Times reports: Virginia Pension Fund has a string of crypto investments dating back to 2019.
Rare signal suggesting a bottom in bitcoin price: Bitcoin’s difficulty band is compressing, suggesting miner capitulation and a market bottom.
Coinbase is asking the US Supreme Court to drop fraud-related and Dogecoin-related lawsuits as the company seeks to submit the cases to arbitration after federal judges previously denied such requests.
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