Monex Crypto Market Weekly: October 11

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This post is a translation of the weekly cryptocurrency analysis by Crypto Lab, a wholly owned subsidiary of Monex Group (Tokyo, Japan). Monex is the parent of TradeStation Group. Due to the difference in time zone, we’re able to share Friday’s report today.

Summary

  • PayPal’s (PYPL) decision to exit Facebook’s (FB) Libra project pressured Bitcoin (BTC) early in the week.
  • BTC subsequently rebounded amid strong price action in Ripple (XRP) and Ethereum (ETH).
  • XRP built on gains from last week while fellow altcoin ETH rose after garnering attention at the industry’s largest event, Devcon.
  • Investors should watch the $8,500 level in BTC as an important battle ground.
  • BTC support lies at $8,000 while resistance can be found at $9,000.

This Week’s Market Trends

BTC fell on surprise news of PYPL withdrawing from the Libra project. It later stabilized amid strong price action in major altcoins XRP and ETH.

XRP had a positive reaction to news on October 2 that its Xpring investment division launched a money-transfer platform. Both ETH and XRP rose on news that Binance will launch a number of tokens pegged to leading cryptocurrencies. After starting the week lower, BTC recovered and finished about 6 percent higher.

Binance had another major announcement: a fiat-to-crypto over-the-counter (OTC) platform for the Chinese yuan later this month. On a negative note, the U.S. Securities and Exchange Commission (SEC) denied Bitwise’s Bitcoin exchange-traded fund (ETF). It was expected, so had little impact on prices.

Bitcoin (BTCUSD) chart, with hourly candles.
Bitcoin (BTCUSD) chart, with hourly candles.

This Week’s Topics

  • Morningstar (MORN) will soon provide a crypto-asset evaluation system. (10/4)
  • Retail giant Ikea will conduct the world’s first transactions using smart contracts and e-money. (10/4)
  • Apple (AAPL) CEO Tim Cook says governments, not corporations, should manage currencies. (10/3)
  • Ohio suspends a BTC-based system for paying taxes amid uncertainty about service provider BitPay. (10/4)
  • Coinbase will start a service that allows users to hold money in an account and earn interest. (10/4)
  • PYPL abandons the operating organization for FB’s Project Libra. (10/4)
  • Coincheck, owned by Monex, allows natural-gas customers in the Tokyo area to pay utility bills with BTC. (10/4)
  • Xpring, an investment division of XRP, has launched a virtual-currency payment platform supported by multiple apps and programming languages.(10/5)
  • Fintech company Amun will launch the first virtual-currency based Exchange Traded Product (ETP) on the Swiss Stock Exchange. (10/6)
  • Algo Capital lost $1-2 million of cryptocurrency after its chief technology officer’s phone was hacked. (10/7)
  • Parity Technologies releases a new version of its Parity Singer app to convert old smartphone into a cold-storage wallets (10/7)
  • Stone Ridge Asset Management has submitted documents to the SEC for a cash-settled Bitcoin futures fund. (10/7)
  • South Korean blockchain company Blocko has started business operations in the United Arab Emirates. (10/7)
  • Investigations into blockchain companies by U.K. regulator Financial Conduct Authority (FCA) spike 74 percent year-to-date in 2019. (10/8)
  • Cryptocurrency exchange Coinbase is in discussions with Omni to acquire its engineering team. (10/8)
  • Cryptocurrency futures-exchange operator CoinFLEX has issued derivatives linked to the launch of FB’s project Libra. (10/8)
  • The world’s largest developer event, Devcon 5, opened on Tuesday in Osaka, Japan. It runs through November 8. (10/8)
  • The U.K.’s FCA will announce final rule changes in early 2020 that could potentially block exchange-traded products linked to crypto assets. (10/8)
  • The Ethereum Alliance (EEA) has invented a reward token system to provide incentives for member companies. (10/8)
  • European Union officials intend to propose new rules to regulate currencies such as FB’s Libra. (10/8)
  • Hong Kong’s Securities and Futures Commission (SFC) has issued ruling for investing in cryptocurrencies. (10/9)
  • Jennifer Robertson has transferred almost $9 million to QuadrigaCX’s bankruptcy trustee. The company failed after her husband, founder Gerald Cotton, died without sharing permissions to its cold wallets. (10/9)
  • UNICEF announces the establishment of the world’s first “virtual currency fund” for donations. (10/10)
  • Blockchain startup Wireline announces a stablecoin which will be linked to FB’s Libra. (10/10)
  • The Swiss National Bank and Bank of International Settlements sign an operational agreement to explore cryptocurrencies. (10/9)
  • U.S Senators Brian Schatz (D-HI) Sherrod Brown (D-OH) have voiced concerns that members of FB’s Libra project haven’t satisfactorily responded to regulatory concerns. (10/9)
  • SEC rejects BTC ETF filed by BitWise. (10/9)
  • The U.S. House of Representatives Financial Services Committee announces that FB CEO Mark Zuckerberg will testify about project Libra on October 23.
  • The Law Review has published the “Virtual Currency Regulation Review, 2nd Edition” explaining the laws of 29 countries around the world. (10/10)
  • Binance has begun offering peer-to-peer (P2P) transactions in the Chinese yuan. (10/10)

Next Week’s Forecast

BTC has upside potential if it can break through $8,500.

The rejection of BitWise’s ETF and worries about Libra highlight the regulatory hurdles still facing cryptocurrencies. On the other hand, the industry continues to make incremental improvements.

Short-term BTC price fluctuations continue to be influenced by global equity markets and price action in the major altcoins.

Stock prices are pinned on the U.S.-China trade negotiations. In regards to altcoins, XRP has potential to rise in the short term because several events are expected next month. Investors wanting to follow BTC’s momentum will look to see whether the 200-day moving average hold as well as a break of the critical $8,500 level. BTC bulls need to defend the $8,000 low on any pullback.

Next Week’s Topics

  • 10/14-15: ChainPoint Blockchain conference in Yerevan, Armenia
  • 10/15-17: Hard Fork Summit in Amsterdam
  • 10/15-16: Crypto Invest Summit in Los Angeles
  • 10/16-17: Blockchain Life in Moscow
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