Welcome back to the second volume of ‘The Digital Asset Digest’, Global Digital Asset’s official market newsletter.
Last week we narrowed our focus onto COVID-19 and its impact on the equities and crypto markets. If you missed the release you can catch up here. This week, we will be broadening our scope and taking a glimpse into the crypto & equity markets at large.
Digital Assets – Bitcoin closed at $6,470 Friday, up 4.4% for the week after Congress passed a historic $2.2 trillion stimulus package to fight the devastating economic impacts of COVID-19. Ether was relatively unmoved, rising 0.90% while XRP closed up 12.3% over the same week.
Equities – The S&P 500 rose 12.1% last week, driven by gains in real estate, materials, and financials as new COVID-19 cases in the US and key European regions have seemed to level off. Treasury yields rose slightly in response.
Commodities – WTI Crude dropped 19.7% for the week as analysts debated whether Saudi Arabia and Russia’s deal to cut oil production would sufficiently offset the lack in demand caused by the coronavirus pandemic. Gold is up 6.5% as deflationary fears linger.
News of the Week
“Bitcoin Cash (BCH) went through with its first block reward halving this past Wednesday, with the coin price gaining 11.2% on the day. Those gains were exceeded by Bitcoin SV (BSV), which gained 19.4% over the same period. Bitcoin SV scheduled its own block reward halving on Friday, April 10th, the excitement around this protocol change was most likely the catalyst for the coin’s price surge last week.
Both Bitcoin forks were the only cryptocurrencies in the green as the market came to a close this past week. However, those gains look to be short-lived, as the market is already trading a few points below Friday’s price.
“India, the world’s second-most populous country, is increasingly embracing cryptocurrencies amid domestic economic issues and the nationwide coronavirus-related lockdown. It started on March 4 when the country’s highest court quashed a Reserve Bank of India (RBI) order dated April 6, 2018, which prohibited banks from providing services to entities dealing with cryptocurrencies. Activity on exchanges immediately picked up… Crypto banking services platform Cashaa noted a spike of 800 percent in trading volumes in the 48 hours following the decision. “The platform also registered a volume of 600+ BTC in the first 24 hours,” said Cashaa CEO Kumar Gaurav.”
“A group of investors sued four cryptocurrency exchanges and seven issuers claiming they sold billions of dollars of unregistered digital tokens and other securities in violation of U.S. securities laws. The lawsuits name exchanges Binance, Bibox, BitMEX and KuCoin, and issuers Block.one, Tron, Bancor, Civic, Kybercoin, Quantstamp and Status, according to attorneys for the plaintiffs. The suits, filed late Friday in Manhattan federal court, seek to represent classes of cryptocurrency investors.”
“China’s central bank has sent one of its strongest signals yet of a commitment to creating a digital version of the yuan. “The People’s Bank of China (PBoC) will undoubtedly further its research and development of the national digital currency with enhanced top-down design,” the bank said in an April 4 notice. The notice is a summary of the 2020 National Currency Gold Silver and Security Work Video and Telephone Conference, convened on Friday by Yifei Fan, the central bank’s vice governor. One of the annual meeting’s goals was to lay out top priorities for the bank in this coming year.”
Token Highlight: Seele (Seeletech)
Seele is a token developed by SeeleTech that describes itself as blockchain 4.0, building on top of previous advances in Bitcoin, Ethereum, and the lightning network. The team’s priorities in building the token are scalability, security, and efficiency. To accomplish this, Seele developed a Matrix-Proof-of-Work consensus algorithm, which forces miners to solve for determinants of matrices constructed with hashes rather than the brute-force hashing methods used by Bitcoin. The algorithm is designed to prevent ASICs and GPUs from dominating the entire network.
Seele completed their ICO in April 2018. Two weeks ago, the team released its Seele Stem subchain beta 1.0, which enables unlimited groups of users to build their own blockchain and interact with the Steele mainnet. As of April 10, SEELE traded at $0.065 with a market capitalization of $45.6 million.
BITCOIN ANNUAL PERFORMANCE
INDICES & COMMODITIES
WEEKEND READING: OPINION
“Had anyone presented the current situation to a crypto enthusiast in December, they likely would have said that they couldn’t have imagined a scenario more conducive to crypto’s macro narrative. That scenario may not be all sunshine and rainbows, though… We may be witnessing a fundamental shift in legacy market sentiment — specifically, the cozy relationship between the government and corporations. The stimulus package revealed that corporations were woefully unprepared for any type of supply/demand shock and had abused low-interest loan rates to buy back their own shares.”
Indicators on Bitcoin are bearish heading into the new week after a month-long rally, as BTC broke below the 50-day EMA on Friday. Though RSI seems to signal that there’s still room to rally, MACD convergence paints a bleaker picture, along with weakening momentum signaled by a tumbling ADX. A new high for the month was established at the $7,500 mark, so if resistance is confirmed, this would be a strong indicator of a potential reversal.
“The chief value of money lies in the fact that one lives in a world in which it is overestimated.”
– H.L Mencken
Although the market sentiment is still somewhat bearish, the unprecedented levels of fear and uncertainty from previous weeks have subsided, and so too have the aggressive sell-offs. We hope that the continued perseverance we have seen on a global scale will continue as COVID-19’s economic uncertainty remains.