Crypto update Crypto update Crypto update

Crypto Update: Under pressure

Picture of Jacob Pouncy
Jacob Pouncey

Cryptocurrency analyst, Saxo Bank

Last week saw the entire cryptocurrency market capitalisation fall 1.5% to $424 billion. Ethereum outperformed the market by rising 9% over the week. Interestingly, Bitcoin has risen 0.5% for the week after failing to stay above the critical $10,000 level on multiple exchanges.

This week the market is showing a divergence in the correlation of the top cryptocurrencies with the overall market. Bitcoin was testing critical levels on the upside and downside, while Ethereum was rising to previous yearly highs. 

Ethereum could be under pressure

Block.One, one of the largest Ethereum holders, moved 209,000 ether to the Bitfinex exchange this week. The ether sent to Bitfinex only represents a fraction of Block.One’s total Ethereum holdings of over six million ether and represents 4% of the daily traded ether volume. However, Block.One’s ether stash could put continued pressure on Ethereum as Block.One needs to sell the ether to fund its platform development, which launches in June.

Block.One has acquired over 6% of the ether outstanding via its ICO for the EOS platform. Block.One could hold as much as 10% of the ether outstanding by the end of the ICO. The EOS platform is a smart contract platform similar to Ethereum. Block.One holding 6%+ of the Ethereum network (a competitor) could prove to be challenge for Ethereum.

US Federal Reserve says futures launch could be responsible for BTC price

The Fed released a report earlier this week citing the launch of the first exchange-traded Bitcoin futures as the reason for the 2017 bull market and the subsequent decline price in 2018. The report stated that the speculative demand for spot bitcoin led to an increase in price going into the launch of the Bitcoin futures. On the other hand, the launch of the futures lowered the demand for spot bitcoin and allowed for the shorting of the bitcoin market on a regulated exchange for the first time. The futures volume has been increasing since their launch in December.

 
XBTUSD

Disclaimer

The Saxo Bank Group entities each provide execution-only service and access to Analysis permitting a person to view and/or use content available on or via the website. This content is not intended to and does not change or expand on the execution-only service. Such access and use are at all times subject to (i) The Terms of Use; (ii) Full Disclaimer; (iii) The Risk Warning; (iv) the Rules of Engagement and (v) Notices applying to Saxo News & Research and/or its content in addition (where relevant) to the terms governing the use of hyperlinks on the website of a member of the Saxo Bank Group by which access to Saxo News & Research is gained. Such content is therefore provided as no more than information. In particular no advice is intended to be provided or to be relied on as provided nor endorsed by any Saxo Bank Group entity; nor is it to be construed as solicitation or an incentive provided to subscribe for or sell or purchase any financial instrument. All trading or investments you make must be pursuant to your own unprompted and informed self-directed decision. As such no Saxo Bank Group entity will have or be liable for any losses that you may sustain as a result of any investment decision made in reliance on information which is available on Saxo News & Research or as a result of the use of the Saxo News & Research. Orders given and trades effected are deemed intended to be given or effected for the account of the customer with the Saxo Bank Group entity operating in the jurisdiction in which the customer resides and/or with whom the customer opened and maintains his/her trading account. Saxo News & Research does not contain (and should not be construed as containing) financial, investment, tax or trading advice or advice of any sort offered, recommended or endorsed by Saxo Bank Group and should not be construed as a record of our trading prices, or as an offer, incentive or solicitation for the subscription, sale or purchase in any financial instrument. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, would be considered as a marketing communication under relevant laws.

Please read our disclaimers:
Notification on Non-Independent Investment Research (https://www.home.saxo/legal/niird/notification)
Full disclaimer (https://www.home.saxo/legal/disclaimer/saxo-disclaimer)
Full disclaimer (https://www.home.saxo/legal/saxoselect-disclaimer/disclaimer)

Saxo Bank A/S (Headquarters)
Philip Heymans Alle 15
2900
Hellerup
Denmark

Contact Saxo

Select region

International
International

Trade responsibly
All trading carries risk. Read more. To help you understand the risks involved we have put together a series of Key Information Documents (KIDs) highlighting the risks and rewards related to each product. Read more

This website can be accessed worldwide however the information on the website is related to Saxo Bank A/S and is not specific to any entity of Saxo Bank Group. All clients will directly engage with Saxo Bank A/S and all client agreements will be entered into with Saxo Bank A/S and thus governed by Danish Law.

Apple and the Apple logo are trademarks of Apple Inc, registered in the US and other countries and regions. App Store is a service mark of Apple Inc. Google Play and the Google Play logo are trademarks of Google LLC.