Welcome back to the 17th edition of ‘The Digital Asset Digest’. After months of bitcoin failing to break through key resistance levels, and the industry suffering from the PR pushback caused by one of the most wide-scale twitter hacks in history, it seemed like the deflated market had no end in sight. However, the market actually saw a massive spike this week, and we will be explaining why in today’s Digital Asset Digest.
Digital Assets – Cryptocurrency markets saw a massive spike this week. Bitcoin closed Monday morning up 13.4% for the week, driven by a massive rally beginning last Tuesday. The real spotlight was on Ether, which rose a whopping 37.0% over the same period, while XRP trailed slightly at 12.1%. The catalyst for such a move is unclear, although outlets are pointing towards BTC’s use case as “digital gold” as a similar rally in gold surged the metal past to all-time highs.
Indices – Equities stalled this week as the S&P 500 edged 3,240 on Monday. Both the Dow and the S&P 500 fell 0.4%, while Japanese stocks were unmoved. Stocks in Energy and Materials saw the largest gains as investors continued their flock to hard assets.
Commodities – Gold stole the limelight on Wall Street this week as the commodity crossed $1,900 oz/t for the first time on record. Silver saw even stronger gains. Amidst increasing coronavirus cases globally, the risk-off sentiment across the Street clearly continues to intensify.
“The total value of cryptocurrency locked in decentralized finance’s (DeFi) oldest project has surpassed $1 billion for the first time. MakerDAO, which is also the sector’s largest protocol by a margin of $271 million locked in, crossed above $1 billion at around 18:00 UTC on Sunday, according to analytics aggregator DeFi Pulse. The milestone, which represents how much money has been committed and not earned, demonstrates a rising interest in MakerDao and DeFi projects alike. Collateral, locked up in the form of ether (ETH) or basic attention token (BAT), is used on Maker’s protocol to undertake lending and generate DAI as debt against collateral.”
“Coinbase now has over 35 million users in over 100 countries, the world’s most popular cryptocurrency exchange said in a new report. San Francisco-based Coinbase said in its Crypto H1 2020 institutional review that it now operates the largest regulated exchange in the world—and it is continuing to grow. The 35 million users mark, which includes its retail and institutional clients, is up five million from last year. Last July, Alistair Milne, the CIO of the Altana Digital Currency Fund, the London-based crypto arm of the Altana Investments hedge fund, tweeted a spreadsheet showing Coinbase’s growth year-on-year.”
“China-based mining pool Btc.top wants to upgrade the concept of cloud mining, which allows users to mine crypto remotely by buying a certain amount of hash power from a third-party, with what it calls “joint mining.” Announced on July 25, the company’s new “joint mining” subsidiary B.top aims to reduce the risks associated with “popular cloud mining products” by offering more flexibility. Specifically, B.top claims to charge service and maintenance fees to its users only after they have reached the break-even point, meaning that its customers start to share profits when their revenue is equal to the cost they initially paid to purchase the equipment.”
“The daily income earned by Ethereum miners has soared by over 60% in a month, according to data tracked by Ethereum mining pool Sparkpool. The surge in daily profit from Ethereum mining surge has also outpaced ether‘s (ETH) price jump of 40% over the same period. The profitability rise comes thanks to soaring transaction fees on the network, as well as relatively slow growth in competition from other miners. Sparkpool’s data shows Ethereum miners’ daily income was around $1.85 per 100 megahashes second (MH/s) on the network on June 27. Over the past month, and the last two weeks in particular, this has jumped by 60% and reached as high as $3.27 on July 25. The metric has since dropped back to around $3.”
Flexacoin describes itself as a digital collateral token that enables instant point-of-sale payments on the Flexa network. Through the Flexa network, Flexacoin users can openly trade the coin with other integrated retailers and users. The token is built on the ERC-20 standard and is built on the idea that scalability is required to support spending capacity. Through staking, Flexacoin temporarily secures cryptocurrency transactions while they are awaiting confirmation on the blockchain, guaranteeing that every transaction on the Flexa network settles. Anyone on the network can stake Flexacoin and stakers are rewarded with a small percentage of each transaction to compensate for the risk.
Flexa completed its token sale in December 2018. In April 2019, Flexa announced that it had raised $14.1 million in venture capital funding led by Pantera Capita, 1kx, Nima Capital, Access Ventures, and other partners. The team is based on New York and founded by former executive members at Raise, a leading digital retail payments platform for consumers. As of today, Flexacoin trades at less than $0.01 with a market capitalization of $129.7 million.
Cryptocurrency Weekly Performance
Indices & Commodities
“Based on these passionate declarations, it would seem that those who live and breathe crypto vehemently reject the fintech label. They view fintech as a mere iteration on the incumbent rails of traditional finance, while crypto is building something inherently transformational, coming from a fundamentally different place in terms of culture, identity and motivation. Apolline Blandin, Cryptocurrency and Blockchain Lead at the Cambridge Center for Alternative Finance (CCAF), in the U.K., believes that a crypto-asset perfectly fits its definition of alternative finance as a monetary system emerging outside the traditional one. “More importantly, it is aligned with our mission to unearth data about emerging industries,” said Blandin.”
We are cautiously bullish this week on Bitcoin. In last week’s Digital Asset Digest, our stance was neutral and we pointed towards weakening momentum and low volatility to explain why we were sitting on the sidelines. This week, however, it is clear that the bulls have come roaring and that BTC has finally closed successfully past the $10K resistance mark (a key level our readers know we have been watching for quite some time).
The ADX seems to indicate that this bull run is just getting warmed up, and given how long the crypto market has been waiting for an opportunity like this, we expect more funds to flow into digital assets over the upcoming week. The reason why we cautiously bullish this week is because indicators are also showing that the coin is in overbought territory. Since its surge over the last two days, RSI has remained above the 70 mark, suggesting a strong potential pullback. For now, we are buyers of Bitcoin, but if RSI crosses under 70 over the week, we would consider unloading back into fiat.
After weeks of cyclical market activity, Bitcoins meteoric rise this week should not be taken lightly. Whether it is a renewed interest in decentralized technology, or institutions assigning a new risk assessment to crypto, there has clearly been an injection of new capital and we hope that it is here to stay.
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