This Friday (22), without losing the 10% increase achieved in a week, Bitcoin (BTC) corrected almost 3% of its price in one day, trading now at US$ 63,600, according to CoinGoLive.
This drop did not affect the optimism of investors in Bitcoin, but due to the recent departures of Paulo Guedes’ team at the Ministry of Economy, the national market retreated a little.
The altcoin that was not intimidated by the fall was Solana (SOL) which from yesterday to today rose 6.16%, continuing its upward trajectory of 35% in one week.
Bitcoin investor is optimistic
News that the US will finally have its own Bitcoin ETF, even if it’s one of Futures, for now, brought significant gains for the primary cryptocurrency this week. When the first reports surfaced, the BTC quickly soared above $60,000.
After this peak, however, the bears attacked again and pushed the asset to the south – the blow was so strong that in some exchanges the price reached four digits. The event was called a flash crash.
Corrections of this type occur, because as the on-chain analyst Glassnode explains: “As the market moves towards ATH and investors have bigger and bigger unrealized profits, the incentive to sell also grows”.
It’s easy to see this on the chart, where it appears that 98.34% of currencies are now held with unrealized profits. Most are from long-term investors (LTH) – or rather, “diamond hands”.
As of now, the BTC has recovered some land and is above $63,000. The strength of bullish indicators for the currency can also be translated into investor sentiment now, which is quite optimistic according to the Fear&Greed index.
Its market capitalization is around $1.2 trillion, while its dominance over altcoins is 44%.
While the cryptocurrency investor is quite optimistic, the local economic scenario is a little different.
Disband of the economic team
The level of mistrust with the direction of public accounts reached new peaks yesterday and hit domestic assets hard. The recent movements around the creation of Auxílio Brasil were understood by national investors as a breach of the fiscal regime, which removed the parameter of asset prices.
With the demand for much higher risk premiums, future interest rates soared, the dollar went to R$ 5.66 and the Ibovespa fell close to 105 thousand points in the lows of the day.
The investor’s distrust is rational, since, before the spending ceiling was breached, 3 secretaries from the Ministry of Economy and 2 more assistants from Guedes asked to leave. The stampede takes place on the same day that the rapporteur of the PEC dos Precatórios, Hugo Motta, accepted the government’s request to change the fiscal rule.
The maneuver will help make room for another R$83 billion in the Budget. In this way, the amount would be used to fatten up the Auxílio Brasil program – a replacement for Bolsa Família – in order to pave the way for the electoral process for the reelection of the president.
In the Chamber, the text has already passed through the CCJ and, now, through the special commission. The text must now go through two votes in plenary. According to the president of the Legislative House, Arthur Lira, “the environment is favorable to approval.”
For the approval of a PEC, at least 308 votes are needed in the Chamber of Deputies and 49 in the Senate, in two rounds.
Since yesterday, altcoins are not making very significant gains. Ethereum (ETH) even came close to a new ATH, but now it’s trading at just over $4,130.
In contrast, Solana (SOL) was highlighted again with an increase of 6.39% in one day and more than 30% in the last week. Yesterday it stole Ripple’s place in CoinGoLive’s cryptocurrency rankings.
The result of the main altcoins in the last 24 hours is as follows: Ethereum (-4.24%), Binance Coin (-0.18%), Cardano (-3.54%), Solana (+6.39%), Ripple (-4.07%), Polkadot (+1.83%), Dogecoin (-3.31%), Earth (+7.13%), Avalanche (+2.45%), Shiba Inu (-0 .15%) and Wrapped Bitcoin (-3.21%).
The cumulative market capitalization of all cryptocurrencies was close to $2.7 trillion.
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Bitcoin Senator Rallies For Support Against Powell’s Renomination As Federal Reserve Chair, Here’s Why
Popular Bitcoin Senator, Senator Cynthia Lummis is reportedly soliciting for the support of her fellow Republicans in her stance against Jay Powell after the latter got renominated to chair the Federal Reserve.
Bitcoin Senator Wary of Crypto-unfriendly Nominees
As reported by Decrypt who first broke the news, a source in Lummis’ office says her reasons border on her belief that there is an unlawful treatment of crypto-based institutions in her home state, Wyoming.
Meanwhile, the Bitcoin senator is not only against the nomination of Powell. The source still claims that Senator Lummis is also asking her Republican colleagues to help block Leal Brainard’s nomination as well. Brainard is another nominee of President Biden’s for the Fed positions.
Lummis’ skepticism might be as a result of the Special Purpose Depository Institutions or SPDIs as they are otherwise called. They are a new type of crypto-based bank that Wyoming lawmakers granted a special operational license to, just last year.
Two crypto-based companies that received the license in 2020 include Kraken exchange and Avanti — the stablecoin issuer. However, the Federal Reserve’s decision to not approve their applications for central bank-issued accounts has placed a hold on their banking ambitions.
Speaking about the Federal Reserve’s delay in a Wall Street Journal feature article by Lummis on Wednesday, she says it is an intentional and unlawful obstruction. She added that the Fed’s reasons are ambiguous at best. According to the Bitcoin Senator, Lummis claimed that the Wyoming entities have met all requirements for being a bank under the Federal Reserve Act.
Lummis insists that Powell and Brainard are only avoiding their legal obligations in their continued treatment of SPDIs and like many other U.S lawmakers, she wants to know why.
Could Lummis’ Pressure Affect Powell’s Confirmation?
As Lummis continues to apply even more pressure on her colleagues, the possible extent to which this pressure can truly go in affecting the confirmation process of both Powell and Brainard, remains to be seen.
But with the chair of the Senate Banking Committee, Sherrod Brown, reportedly holding a vote on the pair sometime this month, both of them could be confirmed.
Also, there’s a possibility of a potential tight vote now that some progressive Democrats — most notably Elizabeth Warren — are saying they will not be voting for Powell.
PlanB’s Floor Model First Miss: Bitcoin Price Closed Way Below $98K In November
PlanB’s floor model was wrong about BTC’s November closing price. The stock-to-flow model, though, is still on track.
Bitcoin’s closing price for November below $60,000 meant that PlanB’s floor model, which was particularly accurate until now, was finally broken.
At the same time, though, the analyst confirmed that the more popular stock-to-flow model was still valid as BTC is on track towards $100,000.
PlanB’s Floor Model Fails
PlanB is among the most popular analysts in the cryptocurrency space, predominantly known for the Bitcoin stock-to-flow model, which he published in early 2019. However, he also posted another model, which he referred to as the “worst-case scenario,” in July this year.
Also known as the floor model, it’s based on technical aspects, such as the 200-day moving average, and saw BTC closing August at $47,000, September at $43,000, and October at $63,000.
The first two months were spot on. BTC closed in October at $61,000, which was still very near to the model’s predicted price, and PlanB said it was “good enough” for him.
However, November’s closing actual closing price of way below $60,000 was quite different from what the model envisioned – $98,000. As such, the analyst admitted that this was the model’s first miss after nailing the previous few months.
Floor model first miss (after nailing Aug,Sep,Oct). No model is perfect, but this is a big miss and the first in 10y! Outlier/black swan? I will give Floor model 1 more month.
S2F model unaffected and on track to $100K.
Watch out for trolls confusing Floor and S2F model! https://t.co/tj6SSwSzKR— PlanB (@100trillionUSD) December 1, 2021
S2F on Track
As mentioned above, the floor model works separately from the stock-to-flow model, which sees the stock as the size of existing reserves (or stockpiles) and the flow as the annual supply of new bitcoins to the market.
It’s actually even more bullish as the original version sees bitcoin tapping $100,000 by the end of the year. The upgraded stock-to-flow cross-asset model, which introduced different phases of bitcoin’s development, predicted a price tag of $288,000 until 2024.
Although bitcoin still struggles below $60,000 at the time of this writing, PlanB believes that the original S2F hasn’t been broken as the asset is on its way towards $100,000. If BTC is indeed to go into a six-digit price territory, it would have to increase its USD value by more than 66% in the next 30 days.
CashApp Added Bitcoin Taproot Support, Here’s Why It Is Important
CashApp now supports the updated version of Bitcoin
The widely known Cash App mobile payment service developed by Square, which is being used to transfer money with the usage of a mobile app, now fully supports the Bitcoin taproot update.
The mobile payments service is currently available in the U.S. and the U.K. but is still reporting 70 million annual transactions between users and generating $1.8 billion in gross profit.
The taproot upgrade was highly anticipated by the Bitcoin network and the cryptocurrency community in general. Previously, the update went into effect on Nov. 14, 2021, at block 709,632.
Previously, the announcement appeared on the app’s website that has described numerous benefits that users will experience after the implementation of the update. One of the main advantages is increased privacy and reduced transaction fees.
The two-week period has been chosen to confirm the functionality of the updated version of the currency. As for now, the update has been activated for all customers. Taproot-enabled wallets are now available for both receiving and sending.