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Market Wrap: PayPal helps Bitcoin after $ 12.eight,000 as Ether dominance falls

market-wrap-paypal-helps-bitcoin-after-12-eight000-as-ether-dominance-falls

Bitcoin has passed its previous 2020 high, while Ether's crypto market share has fallen from its September 2020 high.

  • Bitcoin (BTC) starts trading at $ 12,709 as of 8:00 PM UTC (4:00 PM ET). Gain of 6.4% in the last 24 hours.
  • Bitcoin's 24-hour range: $ 11,863 to $ 12,916
  • BTC above its 10-day and 50-day moving averages, a bullish signal for market technicians.

Bitcoin trading on Bitstamp since October 19th.

Source: TradingView

The price of Bitcoin got a crack this week, rising for the third time in a row, and hit up to $ 12,916 on the Bitstamp spot exchange on Wednesday. Payment company PayPal's recent development, confirming it will be bringing in crypto for its users and merchants, helped trigger the 2020 record high for the world's oldest cryptocurrency of $ 12,709 at press time.

Continue reading: PayPal promises to bring crypto to 26 million merchants and confirm entry into the market

"PayPal released key news for widespread retail adoption this year, with full support for Bitcoin," said Henrik Kugelberg, a Sweden-based over-the-counter crypto trader. PayPal's (NASDAQ: PYPL) share price is also reaching record highs in 2020, up 92% so far this year.

pypl

PayPal Holdings daily trading in 2020.

Source: TradingView

The potential for bitcoin's further incorporation into consumer finance is helping keep the bull run on, noted Zac Prince, CEO of crypto lender BlockFi. "This merger of Fintech and Bitcoin is another positive development for investors," he said. "It will be an exciting 12 months as Bitcoin continues to expand into consumer finance."

It's not just the PayPal messages that are driving the bitcoin trend soaring, noted Micah Erstling, a trader at GSR. "It is encouraging that Bitcoin will surpass the $ 12,000 mark with continued institutional interest and a more extensive regulated introduction," Erstling told CoinDesk. Federal Reserve Chairman Jerome Powell's speech on CBDC digital currencies "clearly shows that digital assets are being taken seriously, while Square and PayPal headlines promote a better digital ecosystem through payments and treasury."

btcsince19

Daily spot trading on Bitstamp since 2019.

Source: TradingView

The last time Bitcoin hit this price level was on July 10th, 2019. The general excitement has resulted in the volume on major USD / BTC spot exchanges on Wednesday being much higher than normal at $ 1,165,166,691 as of press time was. In fact, the last time the volume was this high was on September 4th when the daily volume was $ 1,089,417,516.

volchartoct21

Volume on the major USD / BTC spot exchanges over the past two months.

Source: Shuai Hao / CoinDesk Research

Several market analysts see bitcoin as much higher before 2020, including Katie Stockton, technical analyst for Fairlead Strategies. "The July breakout brought the next major resistance to the 2019 high, which is in line with long-term Fibonacci retracement levels near $ 14,000, she said. "We believe this level is likely to be tested in the coming months."

Constantin Kogan, partner at cryptocurrency fund-of-funds BitBull Capital, agreed with this assessment. "Bitcoin has a good chance of hitting the resistance level of $ 14,000 for a double profit this year as the market hasn't fully absorbed all of the positive news."

In terms of derivatives, Bitcoin Open Interest has been on the up for CME, a sophisticated investor venue often used to hedge risk, according to William Purdy, derivatives trader and founder of analytics firm PurdyAlerts.

skew_btc_futures__aggregated_open_interest-19

Bitcoin futures have been open to CME for the past three months.

Source: Skew

"Open interest in futures increases when price increases. This is a bullish trend which suggests that the trend is likely to continue when fresh money comes in," Purdy said. "The increase in CME volume shows strong institutional interest."

Continue reading: Kik, SEC proposes a $ 5 million settlement over a $ 100 million ICO that will end the year-long battle

However, the quant trader QCP Capital drew attention to the uncertainty still ahead for 2020 in its investor announcement on Wednesday. “We still see the US elections as a medium-term risk. With all of the regulatory reminders we had earlier this month, anything going out from this department at election time would be cause for concern. "

The ether dominance is slipping

Ether (ETH), the second largest cryptocurrency by market cap, rose $ 391 on Wednesday and rose 6.2% in 24 hours at 8:00 PM UTC (4:00 PM ET).

After hitting a high of 14% in 2020 on September 1, Ether's share of cryptocurrency market capitalization has declined. As a measure of an asset relative to its larger crypto market cap, "dominance" is a metric that traders use to measure sentiment. At the time of going to press, the number was 11.7% on Wednesday.

ethdomoct21

Aether dominance in 2020.

Source: TradingView

Despite the decline, George Clayton, managing partner of the investment firm Cryptanalysis Capital, does not place too much emphasis on the decline in the dominance of Ether and remains exuberant on decentralized financing or DeFi, which are used in the Ethereum network. "DeFi turned Ethereum into gangbusters – a lot of use," he said, "I can't be a bearish ETH."

Other markets

The digital assets of CoinDesk 20 are all green on Wednesday. Notable Winners as of 8:00 PM UTC (4:00 PM ET):

Read more: Litecoin is rising after PayPal makes it one of the cryptos that customers can buy, sell, hold

  • Oil was down 2.6%. Price per barrel of West Texas Intermediate Crude: $ 40.03.
  • Gold was in the green at 0.86% and at $ 1,924 at press time.
  • US Treasury bond yields were mixed on Wednesday. Yields, moving in the opposite direction as price, rose the most in the 10 year space, rising to 0.811 and up 2.5% in the green.

https://www.coindesk.com/coindesk20

The CoinDesk 20: The assets that matter most to the market

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Melinda Martin