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On-Chain Analysis: Is Q4 The Savior For Crypto? What’s In the Store For Bitcoin & Altcoins

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The cryptocurrency market lost more than 350 billion dollars in value over the last ten days. Bitcoin is now down to its lowest price levels since late July. At the time of writing this article, the price of BTC is hovering around 41k-43k, and other cryptos, as usual, are following its price movements. 

We are now witnessing a sell-off based on public sentiment led by the equity market crisis and China banning crypto transactions. Evergrande China is the second-largest real estate developer, and it is on the brink of default. With over $300 billion in debt, the company is experiencing a financial meltdown raising concerns for investors worldwide. Some of them are nervous because it could turn out to be one of the Lehman Moments. 

With so much fear circulating, the market conditions globally got affected in a large way. We saw Dow Jones lose over 500 points, making it the biggest fall since July. Even the Europe Index and Hang Seng were down by more than 2%. 

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This economic contagion is a serious threat to investors and the people employed at Evergrande. The real estate company is estimated to provide four million jobs annually. If the Chinese government fails to bail them out, the economic growth will be stunted to a greater degree. Some experts like Ray Daliobelieve the situation is manageable for the simple fact that the debt is denominated in their own currency.

On-chain Overview 

From an on-chain perspective, the supply dynamics have not changed much. Long-term investors continue to accumulate and leverage these pullbacks as much as possible. Even in terms of miners, they have shown zero sell pressure, and hash power is recovering nicely. We have also seen many trends continue over the past few weeks, and there has been no direct correlation to what’s happening in the equity markets. To understand the underlying data of bitcoin, let us look at some on-chain metrics. 

Realized Price Distribution 

The URPD chart mainly helps us break down demand zones and investor cost basis. Over the last week, we have seen the market absorb $650 million in losses for two consecutive days. This is the first time such a thing has happened since early July. A lot of this has to do with China dropping more news on banning crypto. The SOPR also shows us that we are still in a state of profit, but it must sustain for the next week. 

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Open Interest 

A couple of weeks back— we saw massive liquidation take place in bitcoin futures that were mainly driven by high open interest and funding. But this week, we see a lot of uncertainty in the futures market. Both traders and investors seem to take their bets off the table and wait till there is a confirmation signal. In other words, they are not ready to take risks when the macro trends for bitcoin are unresolved. 

Funding Rate 

When the funding rate is negative, it indicates a bullish price action. As we can see in the chart, the funding rate was in the red for two months, which later led to a massive uptick in price growth. We are now again in the negative percentages, meaning the spot is leading futures. 

Bitcoin Accumulation Score 

According to Rafael, the accumulation is still trending upwards, despite the equity crisis rollover. He believes a continuation of this trend indicates an extremely bullish price action for bitcoin. The blue tones in the chart depict cohorts that are accumulating, and the red tones mean entities are selling aggressively. 

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                                                                   Source- Rafael 

Supply Held by Retail 

Many well-known on-chain analysts like Will Clemente and Willy Woo predict retail investors will drive the middle of this bull run. The percentage of retail holdings forms a large portion of the total supply, increasing every week. In Will’s newsletter, he draws a chart that shows us previous bull runs, and it is clearly visible that retail continues to accumulate in the middle.

Supply Shock Ratios 

Will also plotted the illiquid supply ratios that helps us understand- if there is a change in investor behavior. He sees a trend reversal take place right now, as opposed to pure speculation in the past. 

Most of these metrics indicate a similar trend: big players accumulate first in masses and sell into strength. But the bigger news this week was lightning network integration with Twitter. In every aspect, Strike is showing incredible growth year to date. The capacity of payment channels increased by more than 160%, making a strong case for rapid mainstream adoption.

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 Source- Glassnode

The Strike API is going to simplify cross-border payments like no other application. Jack Mallers also gave a demo on how effortlessly one can transfer money using the lighting network. IoS users can access this feature, and it will later be available to all Android users. This is a big step forward for bitcoin acceptance worldwide. And it is not limited to Twitter’s tip feature. It shows how the same can be done for other applications and make the whole social media networks interconnected by Stripe. 

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Announcing the Stripe API

Closing Thoughts 

Although the fundamental price models of bitcoin remain the same, it is safe to monitor the equity markets as it can indirectly impact multiple asset classes. The only good news we had was lightning network integration, but we still need to see a fully-operation version. Evergrande’s debt crisis will continue to raise fear until and unless the government or the company comes forward with an announcement. In terms of on-chain data, we still see similar trends continue, but they have to sustain moving forward. 

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Bitcoin

BTC Records a New ATH Amid Bitcoin Fut

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Bitcoin recorded a new ATH of $66,930 on Wednesday, October 20, as ProShares’ Bitcoin futures ETF makes an astonishing debut on New York Stock Exchange (NYSE).

As Crypto Economy reported, Tuesday, October 19, was a historic day for Bitcoin (BTC) as the world’s first Bitcoin Futures ETF by ProShares, under the ticker symbol BITO, went live on NYSE that generated an astonishing $1 billion in volume and over 24 million shares traded on its very first day. According to some reports, this first Bitcoin-linked exchange-traded fund listed in the US debuted as the second-most heavily traded fund on the record.

As expected, this historic moment has helped the world’s largest crypto asset by market cap to achieve its new all-time high (ATH) on Wednesday, October 20. According to crypto market tracker CoinMarketCap, the coin crossed its previous ATH of $64,895 on Wednesday evening and then continued to post a new ATH of $66,930. The price has corrected a little and the coin is now changing hands at around $65,000 at the time of writing.

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TVL on Ethereum DeFi tops $100 Billion

This watershed moment is positively impacting the overall cryptocurrency market. As the confidence in crypto is growing, so does the DeFi activity. With this recent crypto rally, the total value locked (TVL) on Ethereum-based DeFi protocols has also crossed $100 billion for the first time, according to the data provided by DeFi Pulse. Aave is leading the DeFi by having more than $17 billion in TVL on its platform.

According to DeFi Llama, the TVL on all DeFi platforms is $219 billion.

VanEck ETF is Coming Next Week

A Bitcoin ETF has been long-awaited by both the crypto community and investors on Wall Street, many of whom have argued for years that approval by regulators would open up digital currencies to more mainstream investors. Some thought that the US might ban cryptocurrency altogether like China, but the government’s approval of Bitcoin Futures ETF is an indication that regulatory headwinds may not be as strong as some expect.

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As the first Bitcoin-linked ETF has gotten the regulatory green light, many more are waiting in line. VanEck will be the second asset manager to share its part in this new era of Bitcoin. A document filed with the US SEC on October 20 indicates that the regulator has given the company permission to launch its fund after Saturday, October 23. The company has announced that its Bitcoin Strategy ETF, under the ticker symbol XBTF, will go live on Monday, October 25.

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Bitcoin Price Analysis: BTC breaks above $65,000 all-time high, further upside to follow today?

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  • Bitcoin price analysis is bullish.
  • BTC/USD set a new all-time high at $67,000 yesterday.
  • Slight retracement to retest $65,000 as support overnight.

Bitcoin price analysis is bullish today as a higher low has been set after a retest of $65,000 as support. Therefore, we expect BTC/USD to continue higher over the next 24 hours.

Bitcoin Price Analysis: BTC breaks above $65,000 all-time high, further upside to follow today? 1
Cryptocurrency heat map. Source: Coin360

The cryptocurrency market traded with strong bullish momentum over the last 24 hours. Bitcoin gained 3.12 percent, while Ethereum gained 12.35 percent. Meanwhile, Solana (SOL) continues to dominate the market, with a gain of 20 percent.

Bitcoin price movement in the last 24 hours: Bitcoin sets new all-time high at $67,000

BTC/USD traded in a range of $63,807.96 – $66,930.39, indicating substantial volatility over the last 24 hours. Trading volume has increased by 34.33 percent and totals $49.2 billion, while the total market cap trades around $1.24 trillion, resulting in the market dominance of 46.29 percent.

BTC/USD 4-hour chart: BTC to reach $68,000 today?

On the 4-hour chart, we can see Bitcoin price slightly retracing overnight as bulls prepare for another push higher today.

Bitcoin Price Analysis: BTC breaks above $65,000 all-time high, further upside to follow today?
BTC/USD 4-hour chart. Source: TradingView

Bitcoin price action has seen steady growth so far in October. After a several-week consolidation above $41,000 at the end of September, a strong push higher was seen on the 1st of October.

Since then, BTC/USD has seen steady growth with several higher highs and lows set. From the previous major swing low of $41,000 to the current swing high of $67,000, BTC has gained around 63 percent.

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Yesterday, the previous all-time high of $65.000 was broken clearly, further indicating strength for the momentum. Overnight a slight retracement back to the $65,000 mark was seen as bears looked to retest it as support, likely before further upside is seen today.

Bitcoin Price Analysis: Conclusion 

Bitcoin price analysis is bullish as a slightly higher low has been set after a retest of $65,000 previous resistance as support. Therefore, we expect BTC/USD to continue higher over the next 24 hours.

While waiting for Fantom to move further, read our guides on LTC wallets, Gero wallets, and  DeFi wallets.

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PayPal co-founder suggests he’s underinvested in Bitcoin while it records new ATH

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Bitcoin [BTC] did it once again. The asset broke its own record and caught the attention of the entire globe. Amidst this, PayPal’s co-founder, Peter Thiel expressed his angst over being “underinvested” in the world’s largest cryptocurrency.

The crypto industry as a whole garnered immense popularity over the last couple of years. From being closely regarded as an instrument that carries out illicit activities, to being adopted by governments across the globe, Bitcoin has certainly come a long way. Now, with a market cap of $1.2 trillion, Bitcoin stands as one of the most prominent currencies in the world.

Earlier today, BTC pushed past its previous all-time high of $64,899 and managed to hit a new high of $66,930.39. While BTC HODLers rejoiced this surge, an array of people were rather disappointed that they hadn’t poured in their money into the king coin. One of them was PayPal’s co-founder Peter Thiel.

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PayPal’s co-founder talks crypto

During a recent interview, PayPal’s Thiel revealed why he felt underinvested in the asset. He added,

“You’re supposed to just buy Bitcoin. I feel like I’ve been underinvested in it.”

The latest move of Bitcoin was lauded by the entire market. Speaking about the effects of BTC’s ongoing rally, the PayPal co-founder suggested that “we are at a complete bankruptcy moment for the central banks.”

An array of people took to Twitter and made their own predictions about Bitcoin. While some suggested that BTC was slated to endure a major fall, a few others noted that the coin could be aiming for $70K. Tesla’s Elon Musk had a rather bizarre prediction for the coin.

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The Tesla CEO’s latest tweet read,

Bitcoin’s rally certainly paved the way for several altcoins hitting new highs. Ethereum PETH], the second-largest cryptocurrency followed the footsteps of BTC and managed to hit an all-time high of $4,366.

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PayPal has played a major role in the crypto-verse in the last year. From opening doors to crypto and constantly remaining bullish about it, has pushed several assets to a new level.

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