News On Bitcoin - Week 36 2024

Weekly update on all things Bitcoin

September 10, 2024

TL;DR

  • BTC is down

  • Bitcoin dominance is down

  • Fed Rate Cuts May Impact Bitcoin

  • Bitcoin Stability Amid Market Volatility

  • Bitcoin Rally Linked to Dollar Weakness

  • Swiss Bank ZKB Launches Crypto Trading

  • Metaplanet and SBI Bitcoin Partnership

  • Core Launches $LstBTC: Bitcoin Staking Reimagined

  • Blockstream's BMN2 Series 3 Launch

  • Bitcoin Hashrate Hits 746 EH/s, New Record

  • Vinanz Expands Sustainable Bitcoin Mining in North America

Bitcoin Price

Crypto is down this week, with BTC being down 5.6% and ETH down 6.0%:

Bitcoin dominance has decreased over the week, rising from 54.1% to a peak of 54.3% and ending at 5.9%. Investor sentiment, regulatory changes, technological advancements, and the overall growth of the cryptocurrency sector shape Bitcoin's market dominance. Its reputation as "digital gold" also enhances its position, making it a key player in the market.

It’s going to be interesting to see whether this trend will continue in the short term, as capital in crypto tends to flow initially to BTC and then further out on the risk-curve, starting with altcoins like ETH and then into mid- or low-cap coins.

Bitcoin (BTC) experienced a significant decline, falling 5.5% from September 3 to September 5, reaching a low of $55,860 from a high of $59,090.

This price drop resulted in $58 million in liquidated leveraged long futures, indicating that bulls were not overly surprised by the downturn.

Despite this, Bitcoin derivatives have shown resilience, suggesting that traders are not excessively leveraging their positions or displaying overconfidence.

Bitcoin (BTCUSD) Analysis:

Bitcoin closed at $56,640.00 on September 6, 2024, marking a decline amid broader economic uncertainties.

Short-term analysis indicates a falling trend channel with support at $52,337 and resistance at $68,119, reflecting negative investor sentiment and lower buy interest, confirmed by high volumes at price bottoms.

Medium-term analysis shows horizontal trends, with Bitcoin marginally breaking down through support at $57,400, suggesting potential further declines, highlighted by consistent low volumes at price tops.

Long-term trends are more positive, with Bitcoin in a rising channel, indicating increasing buy interest over time and a neutral technical assessment, suggesting a hold strategy.

Expected Trading Ranges: Bitcoin (BTC): Support: $52,337 Resistance: $68,119

Market Outlook

Bitcoin is in a short-term downtrend with support at $52,337 and resistance at $68,119. Medium-term signals suggest further declines, but long-term trends remain positive.

Overall, Bitcoin is medium-risk with low liquidity and medium volatility. Investors should monitor upcoming economic data and technical indicators for potential price movements.

BTC/ETH ratio has seen an increase:

Over the past five days, the BTC to ETH rate has experienced a net increase. Starting from 23.30 ETH on September 2, 2024, the rate rose to 23.98 ETH by September 6, 2024. This reflects a general upward trend, with significant daily increases on September 4 and September 5. Despite some fluctuations, the overall movement has been positive during this period.

“The Bitcoin chopsolidation is evolving. The swings are getting larger, and more sustained. Screams to me that this price range is becoming ‘unstable’, and the market is ready to move somewhere else.." 

Financial News

Bitcoin may face significant volatility in September as analysts await the U.S. Federal Reserve's interest rate decision. Currently trading around $59,000, Bitcoin's price could experience dramatic swings based on whether the Fed cuts rates by 25 or 50 basis points.

A 25 basis point cut might signal long-term growth, while a 50 basis point cut could cause an immediate spike followed by a correction. Historical trends show September as a volatile month for Bitcoin, with potential declines up to 20%, reflecting broader economic uncertainties and global monetary policy changes influencing the digital asset's value.

Bitcoin's price fell to $55,860, down 5.5% from September 3-5, but professional traders remain optimistic. Despite this drop, derivatives data show resilience, with no excessive leverage or overconfidence. Bitcoin futures premiums stayed around 6%, and the delta skew of options held a neutral 3%, reflecting stable market sentiment.

The upcoming U.S. job market data could influence Bitcoin's price, especially with the weak ADP report adding downward pressure. However, traders seem unfazed, comfortable with Bitcoin's $56,000 level despite recent ETF outflows, suggesting confidence in the digital asset's stability amidst broader economic uncertainties.

Bitcoin’s potential for a bull run is tied to the recent drop in the Dollar Strength Index (DXY). Historically, a declining DXY signals favorable conditions for Bitcoin, often leading to significant price rallies. Despite the DXY's downturn, Bitcoin's price has remained stagnant, hinting at a possible catch-up rally.

Market sentiment is shifting to a more "risk-on" environment, with increased demand for high-yield corporate bonds. The S&P 500's recent growth and its strong correlation with Bitcoin suggest Bitcoin might soon follow the upward trend, signaling a potential bullish phase in the current market cycle.

Adoption News

Zurich Cantonal Bank (ZKB), Switzerland’s fourth-largest bank with $450B AUM, now offers $BTC and $ETH trading via its e-banking and mobile platforms. The bank securely stores private keys, simplifying crypto investment for customers and eliminating the need for personal wallets. Available 24/7, this service also extends to other Swiss banks.

ZKB’s entry into the crypto market follows its 2021 milestone of issuing the world’s first digital bond on the SIX Digital Exchange, highlighting its commitment to integrating digital assets into traditional banking services.

Metaplanet, dubbed the "Japanese MicroStrategy," has partnered with SBI VC Trade to enhance its Bitcoin trading, storage, and financial strategies. This collaboration offers Metaplanet secure, tax-efficient custody services and enables the company to use Bitcoin as collateral for financing, boosting its financial flexibility.

Metaplanet continues to expand its Bitcoin reserves, now holding 360 Bitcoins valued at $207M. The partnership underscores Metaplanet's commitment to Bitcoin as a core asset, leveraging SBI's advanced services to strengthen its position in Japan's cryptocurrency market.

Core Blockchain has unveiled $LstBTC, a liquid staking token pegged 1:1 to Bitcoin. This innovation allows Bitcoin holders to stake their BTC without locking it, thereby keeping it available for decentralized finance (DeFi) use. Users earn daily rewards in $CORE tokens, enhancing Bitcoin's role in DeFi while preserving liquidity.

The $LstBTC platform incorporates a secure multi-sig setup for added safety and aims to boost Core's ecosystem by attracting developers and users. This move could broaden Bitcoin's application in DeFi, potentially driving new growth and innovation within the sector.

Mining News

Blockstream has launched the third series of its Blockstream Mining Note 2 (BMN2) token, enabling non-U.S. investors to access Bitcoin mining. Each BMN2 token represents 1 petahash per second (PH/s) of mining power from Blockstream’s facilities, providing holders with Bitcoin mined through their hash rate. The token is EU-compliant and follows the successful BMN1, which yielded a 32% Bitcoin return over three years.

The BMN2 series offers a lower hash price and emphasizes sustainability with 80% of mining power derived from carbon-neutral energy. This new token presents an attractive investment opportunity amid the approaching Bitcoin halving.

The Bitcoin network hashrate reached a new all-time high of 746 EH/s on September 3rd, despite Bitcoin trading below $60,000. This surge in computational power reflects stronger network security and long-term confidence in Bitcoin’s fundamentals, even as prices dropped over 10% this week.

Leading mining companies like Whatsminer and MicroBT are launching advanced rigs, while Riot Platforms acquired Block Mining for $92.5 million to boost its hash rate. The growing hashrate signals the industry’s focus on expansion and technology upgrades, highlighting the disconnect between network health and short-term price fluctuations.

UK-based Bitcoin miner Vinanz employs a decentralized, asset-light model, partnering with third-party hosts across North America to enhance flexibility and sustainability. By avoiding debt and spreading operations across diverse locations like Indiana, Nebraska, Iowa, and Labrador, Canada, Vinanz mitigates risks from local disruptions while leveraging varied energy sources.

Aiming for operations in 25-30 states within five years, the company balances its growth strategy by allocating 50% of new capital to machines, 30% to monthly costs, and the remainder to R&D and overheads. Vinanz focuses on optimizing profitability amidst Bitcoin's volatility, ensuring a stable, adaptable expansion path.

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