Commentary
Digital Assets ended the week +4.5%, recovering about 1/2 of last week’s declines. Trading continued to slide, dropping another ~ 18% this week to a daily average of $60B. Breadth swung back into the positive this week with 71% of the top 200 coins and tokens ending the week higher.
News flow was stronger this week both in terms of overall sentiment and volume of needle moving stories. Top stories this week included: 1. Binance expanding into the US, 2. FB GlobalCoin building it’s consortium of corporate founders, 3. Bitfinex building out its decentralized product offering, 4. Telegram going back to the market for more money(!), 5. Bitfinex launching its first IEO offering, and 6. Bakkt preparing to launch physically settled BTC futures for insitutionals.
Next week could be a more decisive week for the short-term price trend. Price at the moment seems tough to call. With a very obvious head and shoulders patterns slowly taking shape throughout the week, declining volume and volatility beginning to mean revert, we had been wary of the potential for a price pullback. Outperformance this week by LTC is a reason to not be overly bearish, though, as BTC tends to follow LTC price moves. In short, if we drop below the head and shoulders neckline of $7,500 then it’s likely we’ll see a correction to the $6,000 level. If we can avoid that break next week, then the liklihood of upward momentum picking up again probably increases.
Thoughts
- Reminder — your savings are not safe
– An interesting story out of Italy this week:
Italy proposes tax on savings hidden in safety deposit boxes
– Those who voluntarily declare their deposit-box holdings would be taxed at a ‘low rate’ of about 15%…that’s after, presumably, already having paid income tax
– Interesting to note the language, the verb of choice is ‘hidden’ not ‘saved’
– This seems to tie in with the ongoing global war on cash, which would make it impossible for users to store value outside of the banking system and pave the way for the implementation of negative interest rates (where savers pay to keep their assets with banks, because they have no choice, in an effort to make savers spend their way out of recessions) - Facebook’s GlobalCoin a threat to BTC…or to banks?
– Here’s what we know so far about GlobalCoin:
1. It has pulled in a number of traditional finance and silicone valley types
2. Will cost US$10M to run a node
3. Thought to be targeting retail transactions and cross border payments
4. Will be tied to a basket of currencies
– The big question is will it be a true cryptocurrency, or just an internal settlement mechanism a la Tencent’s WeChat Pay? Within the Digital Asset Space it looks to be a more direct competitor of XRP, but its centralized nature seems to put it more at odds with existing incumbents than BTC.
– A number of the company’s mentioned as early participants in the consortium (Mastercard, Visa, PayPal, Facebook) have a very weak history on censorship resistance. In this light, GlobalCoin seems to be more of an upgrade on the legacy system (in terms of cost and convience as WeChat Pay is) than a challenge to BTC’s value proposition.
News
- Binance says it will launch US exchange business
– Said to be teaming up with BAM Trading Services
– BAM appears to be a registered as a Money Serivces Business with FinCen
– Could possibly be an attempt to better segregate their users to avoid conflicts with US regulators. Meaning that US users would be forced off the global platform and only given access the products and services available on the US entity. - Visa, Mastercard, PayPal and Uber said to be backing FB’s GlobalCoin
– Each of the new backers will invest roughly $10 million in the project
– Previous reporst indicated that the cost of a node would be set at $10m
– Would create a ‘governing consortium for the cryptocurrency’
– GlobalCoin is shaping up to be a consortium of old finance and Silicon Valley — from the perspectives of privacy and freedom it’s hard to imagine a less trustworthy alliance - Bitfinex / Ethfinex facilitate first raise via new Tokinex IEO platform
– Stablecoin Ampleforth successfully raised US$5M in 11 seconds
– Ampleworth aims to be a low volatility synthetic commodity
– The protocol achieves this by actively seeking a price-supply equilibrium - Fundstrat analyst Rob Sluymer, Digital Assets poised to make further gains
“Another upside attempt appears to be developing for most cryptocurrencies. Increase exposure. We expect BTC to stage another rally from current levels toward next resistance between $8,800–$9,000.” - Bitrefill raises $2m in round led by Coin Ninja, eyes global expansion
– Company plans to expand its services outside the US / Europe - Bakkt will begin testing physically-delivered BTC futures July 22.
– Bakkt, has seen multiple delays over regulatory compliance
– Was originally announced August 2018
– The parent company owns many traditional exchanges including NYSE - Ethfinex plans to switch to software governance
– Ethfinex is a sister exchange to Bitfinex
– Will cede control to a decentralized autonomous organization
– Ethfinex’s 23 founding members will be able to vote on operations via the exchange’s native token, Nectar - Iranian architects designed a water park mining facility in a skyscraper
– Kind of a weird one…
– Designs show a water cooled mining facility hidden in a skyscraper - S.Korea’s KB Kookmin Bank and Atomrigs Labs team up on custody
– Have signed an MOU explore asset management and custodial solutions
– Shinhan is also thought to have been interested in custodial solutions - Chinese trader commits suicide betting 2,000 client BTC at 100x leverage
– CEO /co-founder of BTE.TOP, a dedicated crypto data analysis firm
– 2,000 BTC = ~US$14M - Visa launches blockchain payment system, b2b connect
– Looks like a cross border b2b payments system
– Likely negative XRP which has been trying to position itself in this niche - Coinbase expands crypto debit card to 6 more European countries
– Spain, Germany, France, Italy, Ireland and the Netherlands - Bitfinex is listing OKEX’s native token OKB
– Bitfinex will also list USDK a stable coin devloped by the platform - Craig Wright required to make personal appearance in Florida court
– Case alleges Wright stole over 1m BTC from his his former partner
– Wright had attempted to avoid a personal appearance in court - BitMEX issues warning after repeated unauthorized access attempts
– Number of attempts to access users accounts - Metaco SILO, a hot & cold wallet custodial solution secures insurance
– Aon has reportedly organized a sydicate of London insurers
– Will offer a crime insurance product to clients using METACO’s integrated hot-to-cold wallet management solution for financial institutions
– Insurance on hot wallets is notoriously difficult to secure - Telgram’s $1.7B ICO TON token to list on Liquid July 10
– TON will go on sale to retail investors in July, with a full public sale in Oct
– Liquid is a Japan based exchange previously known as Quoine
– Liquid raised funds earlier this year at a US$1B valuation
– The previous US$1.7B TON raise was limited to accredited investors
– It’s unclear why after raising US$1.7B, Telegram needs more funds - BitMEX / CryptoCompare working on futures data for institutional users
– Available on Refinitiv’s Eikon, Reuters version of a Bloomberg Terminal
– Eikon reportedly has 23% market share amongst institutional users - Google update reportedly buries search results for crypto news sites
– Follows reports that CryptoCoinNews has been forced to close down
– Closure driven by a drop in traffic following a June 3 Google Core Update
– CoinDesk reportedly saw a 34.6% drop, Cointelegraph saw a 21.1% drop - BlockTower Capital announces competition for BTC analysts
– The firm is giving away 3.5 BTC in prizes for up and coming analysts - Zilliqa launches smart contract system to its blockchain
– Developers now able to deploy smart contracts on the Zilliqa blockchain
MaiCoin Media
- Head and Shoulders — BTC drop to $6,000?
- Bitcoin’s ‘Institutional’ Opportunity: Part 1, Part 2
Charts
Chart 1. Weekly price vs volume
Chart 2. Weekly price change
Chart 3. Major thematics
Chart 4. Monthly average daily volume as % of historic high
Chart 5. MTD average daily volume
Chart 6. Price, 50D Z Score
Chart 7. BTC vs other Digital Assets, 1 month % change
