fbpx
Connect with us

Bit Coin

3 reasons why a Bitcoin ETF approval will be a game changer for BTC price

Published

on

3 reasons why a Bitcoin ETF approval will be a game changer for BTC price

Some financial experts believe that the price of cryptocurrencies is solely driven by investors’ speculation, and in the past few years, detractors have suggested that fixed income instruments like Treasury bills have no relation to do with digital assets. This point of view is fairly accurate because at this time, most investors from the asset class are not allowed to invest in Bitcoin (BTC) and altcoins.

Public pension funds, retirement plans, fixed income and most non-leverage equity and multimarket mutual funds can only invest in certain asset classes. These limits arise from the fund class regulation, the fund’s own bylaws and the administrator’s risk assessment.

Not every fund can invest in Grayscale Bitcoin Trust

Unbeknownst to most, the mutual fund manager does not have absolute control of the investment decision. The fund administrator is a third-party company that acts as an intermediary between the fund manager and investors to verify and distribute assets tied to investments.

Therefore, the fund administrator might rule that a particular instrument poses a significant risk and either limit the exposure or deny access to it. The trust fund, in this example, is the investment vehicle used by the Grayscale Bitcoin Trust, or GBTC, and involves an issuer credit risk.

Amundi funds breakdown by asset class. Source: Amundi

Global asset managers will typically have a 30% to 60% fixed income exposure, so it is very unlikely to have any exposure to cryptocurrencies. Amundi, the leading European investment firm — with over $2.1 trillion of assets under management — is a good example.

According to BCG Group, the global asset industry has surpassed $100 trillion, with North America holding nearly 50% of this figure. Unfortunately, these astronomical figures cause analysts to incorrectly relate those numbers to the Bitcoin exchange-traded fund (ETF) instrument.

#Grayscale has partnered BNY Mellon, the world’s largest custodian bank with $41 Trillion in assets in custody. In Feb 2021, #BNYMellon announced they were entering the #Crypto space. Big move by Grayscale in the battle for a #Bitcoin ETF.@Grayscale @BNYMellon #etf #bitcoinetf pic.twitter.com/RfSO7UOKGS

— Thinking Crypto – YouTube Channel & Podcast (@ThinkingCrypto1) July 13, 2021

According to Reuters, more than half of all investment-grade corporate bonds in the eurozone now trade with negative yields. This includes $7.7 trillion worth of government debt, which accounts for 70.8% of the total.

Financial Times reported that the value of the global negative-yield debt has surpassed $16.5 trillion, fueled by investors’ more pessimistic outlook and bond purchases by central banks.

Investors will gradually exit fixed income strategies

There’s reason to believe that investors getting negative yields will eventually move to riskier assets, although it is improbable that a total shift to cryptocurrencies will occur. However, the most likely beneficiaries are non-leverage multi-assets and alternative investments, as these instruments usually carry lower risk than equities and high-yield structured assets and bonds.

Consequently, an eventual Bitcoin ETF approval by the United States Securities and Exchange Commission will open the doors for a vast array of funds that are currently shut out from cryptocurrency exposure.

Even if the ETF is exclusively reserved for a part of the equities and multi-asset classes, the new instrument doesn’t even need to capture $500 billion to propel Bitcoin’s market capitalization above $2 trillion. Less than 2.5 million coins are deposited on exchanges, equivalent to $125 billion readily available for trading.

Commodity funds are the best candidate

According to iShares, the value of global commodities exchange-traded products adds up to $263 billion. Considering that not every mutual fund is listed, it is reasonable to assume that the actual number surpasses $500 billion.

This means that a mere 1% allocation from this specific asset class is equal to $5 billion, and such an investment would surely be enough to propel Bitcoin’s price above its $65,000 all-time high.

If and when a BTC ETF is approved, traders will front-run the potential inflow as soon as the approval is announced, regardless of whether the products capture only $5 billion in the first couple of months.

As long as governments and central banks continue injecting liquidity, buying bonds and issuing stimulus packages, there will be a gradual inflow to riskier assets, increasing the demand for the ETF.

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk. You should conduct your own research when making a decision.

Go to Source

Bit Coin

BTC, ETH, XRP, ZEN, UNI, OMG, AXS — Technical Analysis Sept 28

Published

on

BTC, ETH, XRP, ZEN, UNI, OMG, AXS — Technical Analysis Sept 28

Bitcoin (BTC) was rejected by the $44,000 horizontal resistance area.

Ethereum (ETH) is following a descending resistance line and potentially trading inside a descending wedge.

XRP (XRP) is following a descending support line.

Horizen (ZEN) has broken down from an ascending support line.

Uniswap (UNI) has broken out from a descending wedge.

OMG Network (OMG) is following an ascending support line.

Axie Infinity (AXS) has broken out from a descending resistance line.

BTC

On Sept 27, BTC was rejected by the $44,000 resistance area and created a long upper wick (red icon). This is a bearish sign since the area had previously been acting as support, and the rejection now validates it as resistance.

Technical indicators in the daily time frame are bearish. Both the RSI and MACD are decreasing. The former is negative while the latter has just fallen below 50.

The next closest support area is found at $38,000.

ETH

ETH has been decreasing underneath a descending resistance line since Sept 3. Most recently, it was rejected by the line on Sept 16.

Due to the long lower wicks, the support line cannot be accurately determined. However, it’s possible that ETH is trading inside a descending wedge.

Despite the wedge normally being considered a bullish pattern, technical indicators are neutral. The RSI is right at the 50-line and the MACD is below 0, although it is increasing.

Therefore, the direction of the trend cannot be accurately determined at the current time.

XRP

XRP has been following a descending support line since Aug 17. So far, it has been validated multiple times, most recently on Sept 21. The final touch of the support line (green icon) also coincided with the 0.618 Fib retracement support level at $0.85.

Despite the fact that XRP is trading above a confluence of support levels, technical indicators are not bullish. The RSI is at the 50-line and the MACD is negative, even though it is moving upwards.

The closest support and resistance levels are found at $0.76 and $1.07 respectively.

ZEN

ZEN has been decreasing since Sept 15, after creating a double top pattern and a long upper wick. The pattern was also combined with a bearish divergence in the RSI.

Shortly after, it broke down from an ascending support line. The breakdown is supported by the MACD and RSI, which are both decreasing.

The closest support area is found at $53.

UNI

UNI has been decreasing since Sept 2. After the Sept 7 drop, it created a descending wedge, which led to a low of $17.73 on Sept 26.

However, UNI rebounded and broke out from the wedge. The breakout is supported by the increasing MACD and RSI.

The closest resistance area is found at $26.15, created by the 0.618 Fib retracement resistance levels.

If UNI is successful in moving above it, it may move toward new highs.

OMG

OMG has been following an ascending support line since July 20. However, since Sept 6, it has failed to break out above the $10.60 area, which is the 0.618 Fib retracement resistance level.

Despite the rejection, technical indicators are bullish. The RSI has generated a hidden bullish divergence and the MACD is positive.

Therefore, an eventual breakout would be likely. This could take OMG toward the $15.33 all-time high price.

AXS

AXS has been increasing since Sept 21 when it bounced at the $48.28 support area. The next day, it created a bullish engulfing candlestick and broke out from a descending resistance line.

Following this, it reclaimed the $63 horizontal area and validated it as support.

Both the MACD and RSI are increasing, supporting the continuation of the upward movement.

The next resistance area is found at the all-time highs of $94.50.

For BeInCrypto’s latest Bitcoin (BTC) analysis, click here.

Disclaimer

All the information contained on our website is published in good faith and for general information purposes only. Any action the reader takes upon the information found on our website is strictly at their own risk.

Go to Source

Continue Reading

Bit Coin

Bitcoin (BTC) Fails to Move Above $44,000 Resistance

Published

on

Bitcoin (BTC) Fails to Move Above $44,000 Resistance

Bitcoin (BTC) attempted to move upwards on Sept 27 but was rejected by the $44,000 resistance area.

While BTC is still trading inside the upper portion of a descending parallel channel, the price action is lacking bullish signals.

BTC gets rejected

On Sept 27, BTC made an attempt at moving above the $44,000 area but was promptly rejected (red icon). The area had acted as support in August and the beginning of September but turned to resistance after the breakdown on Sept 20. The rejection created an upper wick and a bearish candlestick. 

Besides trading below resistance, technical indicators for BTC have turned bearish as both the RSI and MACD are decreasing. The MACD has just crossed into negative territory while the RSI is below 50. 

If BTC were to continue moving downwards, the next closest support area would be found at $38,000.

Current channel

The six-hour chart shows a descending parallel channel, which usually contains corrective structures.

Currently, BTC is trading inside its upper portion. Furthermore, it’s trading just above the 0.5 Fib retracement support level.  

Despite being above a confluence of support levels, technical indicators are bearish/undecided. The MACD is negative and has lost its strength while the RSI has just fallen below 50.

The two-hour chart shows that BTC is following an ascending support line and has made three higher lows since Sept 21. While this can be seen as a bullish structure, the price action is not bullish. 

The previous resistance area at $43,000 that was expected to act as support did not. On the contrary, BTC fell right through it. Furthermore, both the MACD and RSI have turned bearish.

While there is very strong support at $41,500, created by the 0.786 Fib retracement support level and the ascending support line, the price action does not seem bullish.

Wave count

The most likely wave count still indicates that the decrease from Sept 7 to Sept 21 was part of an A-B-C corrective structure, in which waves A:C had an exact 1:1 ratio. This is also supported by the presence of the descending parallel channel.

However, the movement since the low does not seem impulsive, casting some doubt on the possibility of this being the correct count.

Alternative counts could see the movement as a flat A-B-C corrective structure (upper image), or in the more bearish case a 1/2-/1-2 wave structure (lower image). 

At the current time, the correct count cannot be determined.

For BeInCrypto’s previous Bitcoin (BTC) analysis, click here.

Disclaimer

All the information contained on our website is published in good faith and for general information purposes only. Any action the reader takes upon the information found on our website is strictly at their own risk.

Go to Source

Continue Reading

Bit Coin

Europe becomes largest crypto economy with over $1T in transactions — Chainalysis

Published

on

Europe becomes largest crypto economy with over $1T in transactions — Chainalysis

DeFi has become a major catalyst for Europe’s crypto economy. Large institutions have also upped their share of transactions significantly.

4747 Total views

93 Total shares

Europe becomes largest crypto economy with over T in transactions — Chainalysis

The region of central, northern and western Europe, or CNWE, has emerged as the world’s most active cryptocurrency block, receiving over $1 trillion worth of digital assets over the past year, according to new research from blockchain analytics firm Chainalysis. 

The report, which was released Tuesday, found that the CNWE region accounted for 25% of global crypto activity between July 2020 and June 2021. The region witnessed a sharp uptick in transaction volume across all crypto sub-categories, especially decentralized finance, or DeFi.

Chainalysis describes crypto transactions as anything involving trade, investments and business dealings.

Europe has also become a hotbed for institutional investing, with transactions values in this category growing to $46.3 billion in June 2021 compared with just $1.4 billion in July 2020. Perhaps surprisingly, the United Kingdom is the single largest crypto economy in the region at $170 billion worth of transactions. Nearly half, or 49%, of the value was sent via DeFi protocols.

“The U.K.’s growth is driven mostly by growing institutional investment, based on the large-sized transfers driving most of its transaction volume,” Chainalysis senior content marketing manager Henry Updegrave told Cointelegraph. 

A secular bull market for Bitcoin (BTC), the growth of competing smart contract platforms and the arrival of decentralized finance all contributed to crypto’s massive rally during the study period. It comes as no surprise that CNWE’s crypto market activity peaked in May 2021 during the height of the bull market, which was one month removed from Bitcoin hitting $64,000.

Chainalysis’ data corroborates a growing body of evidence showing that large institutional investors have become a driving force within crypto. Wealth managers, family offices and other institutional players have poured billions of dollars into Bitcoin and Ether (ETH) investment products offered by Grayscale, CoinShares, 21Shares and others.

Related: Crypto asset manager Cobo raises $40M to launch DeFi-as-a-service

Beyond the advanced economies of Europe, Chainalysis research has documented the growing uptake of crypto in emerging markets. The Chainalylsis 2021 Global Crypto Adoption Index named Vietnam, India and Pakistan as the leading countries for adoption based on on-chain value received, retail transactions and peer-to-peer exchange trade volume.

Go to Source

Continue Reading
Home | Latest News | Cryptocurrency | Bit Coin | 3 reasons why a Bitcoin ETF approval will be a game changer for BTC price

Market

Trending