Kategorie: Crypto Analysis

• Binance and Coinbase are sued by the SEC
• Bitcoin price remains resilient
• Scarcity, inflation rate halving, and an increase in the number of users help Bitcoin

Once again, cryptocurrency investors are tested. In a span of 24h, several things challenged the market again.

First, Binance, one of the largest crypto exchanges in the world, was sued by the Securities and Exchange Commission with thirteen charges. Second, Coinbase was sued by the same authority for operating as an unlicensed broker in the US.

Moreover, the SEC filed court documents to freeze Binance’s US assets. Given how strategically important these two players are for the industry, how come Bitcoin price remains resilient? Here are three reasons that might explain such resilience:

• Scarcity
• Increased number of holders
• Halving inflation rate

Scarcity

The upper limit of supply is mathematically fixed at 21 million. This scarcity makes Bitcoin attractive in the eyes of many investors, as it resembles a digital store of value.

The number of users/holders increases

More and more people use or hold Bitcoin. Throughout the years, the number of users and holders increased considerably despite the industry being challenged constantly by fraudsters or, in this case, lawsuits.

Inflation rate halving

By April 2024, Bitcoin’s inflation rate halves again. It means that it will be lower than that of gold, which makes it an attractive asset to those looking for a hedge against inflation in times when inflation reached alarming levels, even in the developed world.

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• Stacks crypto price jumped to the upper side of the descending channel.

• The coin jumped because of its close relationship with Bitcoin.

• This rebound could be part of a dead cat bounce.

Stacks price has staged a strong comeback in the past two days even as concerns about regulations in the US continued. STX has jumped by more than 15% in the past 24 hours. In all, it has jumped by over 22% from the lowest level on Tuesday.

A possible reason for the rally

Stacks is a unique blockchain that creates a layer where developers can create applications for the Bitcoin ecosystem. According to its website, the network has over $901 million locked in its staking ecosystem. In the past few months, the network has distributed over 2000 BTCs to stakers.

It is unclear why Stacks price has jumped sharply in the past 24 hours. A likely reason is that this rally in sync with that of other coins. Bitcoin has risen by over 3% in the past 24 hours while other altcoins like Terra Classic and Pepe have jumped by double digits in the same period.

The other reason is that Bitcoin’s ecosystem is growing, helped by Ordinals, the popular NFT platform. Data by TokenTerminal shows that Bitcoin fee revenue in the past 30 days came in at over $102.7 million, making it the second most profitable network in the industry. 

Additional data by CryptoSlam shows that the total Ordinals sales jumped to a record high in May. Sales soared to over $195 million in May from the previous $33.2 million. 

While Stacks has no association with Ordinals, its success means that more developers could move to its ecosystem soon.

Further, STX price rose because Bitcoin seems safe in the ongoing war on exchanges like Coinbase and Binance. The agency highlighted some of the tokens that it sees as being securities. Bitcoin was not one of them.

Stacks price prediction

The other reason why STX price has jumped is that this could be a dead cat bounce, which happens after an asset dips sharply. On the daily chart, we see that the coin retested the upper side of the descending channel shown in orange. Most importantly, Stacks’ 50-day and 100-day moving averages have made a bearish crossover.

Therefore, I believe that the coin has more downside to go unless it moves above the two moving averages. If this happens, the next level to watch will be at $0.5200, the lower side of the channel.

How to buy Stacks

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• The SEC is suing Coinbase and Binance, in yet another scandal in the crypto industry 
• Bitcoin price remains unfazed
• A bullish breakout might be triggered by the Fed not hiking the funds rate again 

The cryptocurrency industry faces, yet again, another test of confidence. The Securities and Exchange Commission (SEC) announced that it was suing Coinbase and Binance in a move that scared cryptocurrency traders operating on the two exchanges. 

But what had the potential of triggering a bearish move in the main cryptocurrency markets turned out to have zero impact. In particular, Bitcoin shows resilience, trading in a consolidation area before its next move. 

Bitcoin chart by TradingView

Is Bitcoin forming a bullish flag pattern?

One of the reasons why Bitcoin is resilient to such news is that it has become much more correlated with traditional markets. For instance, the tech sector’s movements influence Bitcoin much more than anything else. 

Tech stocks surged in 2023, and so did Bitcoin. 

After failing at $30k, it entered a consolidation which continues still. At this point, it looks like Bitcoin forms a bullish flag pattern, but only if the market makes a new yearly high one may be sure the consolidation ended. 

Therefore, to trade this bullish flag, one needs two things. One is to wait for the market to move first and trade above $30k again. Such a move will signal that the bullish consolidation is over, and it is time to trade the measured move. 

In this case, the measured move is about $10k projected from the upper edge of the flag. That gives us a target of $38k for Bitcoin, should it make a new high for the year. 

All in all, the recent scandals might prove, once again, Bitcoin’s resilience. The cryptocurrency moves in line with the US dollar and the tech sector, and so, if the Federal Reserve decides to pause and not hike the funds rate at the next week’s meeting, Bitcoin’s chances of squeezing higher increase significantly. 

The post Bitcoin unfazed by SEC suing Coinbase and Binance appeared first on CoinJournal.

• The SEC delivered the biggest lawsuit in the crypto industry.

• It sued Binance and Changpeng Zhao in the United States.

Binance Coin price has been in a freefall after the SEC filed a major lawsuit against Binance and its CEO. BNB coin retreated to a low of $272.6, the lowest level since March 11. It has plunged by more than 20% from the highest level this year.

SEC sues Binance and Changpeng Zhao

Binance Coin and other cryptocurrencies plunged hard on Monday and Tuesday after the SEC filed one of the most consequential lawsuits in the crypto industry. In a statement, as we wrote here, the agency sued Binance, alleging that it had defrauded customers and offered regulated products to American customers without following the law.

As expected, in most periods, cryptocurrencies tend to underperform when there is a major announcement such as this. We saw most of them plunge after the collapse of FTX and Terra and its ecosystem. Most importantly, XRP and other coins plunged after the SEC launched a lawsuit against Ripple. 

There are also concerns about the state of regulations in the industry with the US using enforcement instead of engaging the crypto industry. Analysts believe that the agency will continue being tough against digital currency companies after the collapse of FTX.

Still, this is not to say that BNB coin price will continue falling. Instead, the most recent data shows that Binance is doing well. For example, data by DeFi Llama shows that Binance has had over $1.47 billion in outflows in the past 24 hours. While this is a huge number, the company still has over $51 billion in assets.

Further, historically, many investors tend to buy the dip in crypto after big events. For example, most coins jumped this year despite the collapse of FTX.

BNB price forecast

The daily chart shows that the Binance Coin price has been in a slow bearish trend in the past few days. This sell-off intensified after the SEC lawsuit. As it plunged, the coin crashed below the key support level at $298.4, the lowest point on May 12th.

Binance Coin retreated below all moving averages and is slightly above the key point at $265.6. Therefore, I suspect that the coin will remain under pressure this week and then bounce back as the lawsuit fades. As we have seen with XRP, it is possible for a coin to rise despite the lawsuit. The initial level to watch will be at $265.

How to buy Binance Coin

eToro

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Binance

Binance is one of the largest cryptocurrency exchanges in the world. It is better suited to more experienced investors and it offers a large number of cryptocurrencies to choose from, at over 600. Binance is also known for having low trading fees and a multiple of trading options that its users can benefit from, such as; peer-to-peer trading, margin trading and spot trading.

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• Most metaverse tokens rose sharply on Monday as cryptocurrencies retreated.

• The jump happened ahead of Apple’s WWDC event on Monday.

Metaverse tokens like Decentraland MANA, Sandbox’s SAND, and Axie Infinity’s AXS were among the best-performing coins on Monday. Other metaverse tokens like Enjin Coin and ApeCoin were also in the green. Most of these coins rose by more than 1.5%, which is a better performer than other coins like Bitcoin and Ethereum.

Apple WWDC event

The main reason why metaverse tokens jumped on Monday is the upcoming WWDC event by Apple. Historically, this has been the biggest event in the tech calendar since the company usually unveils its key upgrades. 

Apple is seen as the benchmark for key products. It made key products like iPhones, Apple Watch, and iPads cool. Today, other companies in the technology industry have come up with similar products.

Analysts believe that the WWDC event will see the company unveil its virtual reality set, which is its first major product in a decade. The company has been working on this product in the past seven years. In this period, the company has long believed that its product was not ready yet. According to the WSJ, the device will retail at $3,000, making it one of the company’s most premium products.

Experts believe that Apple’s entry in the industry will take the virtual reality industry mainstream. In the past, attempts by companies like Facebook and Microsoft to take them mainstream have failed. Today, only a handful of people use these products.

Therefore, metaverse tokens like MANA, SAND, Enjin Coin, and AXS token have risen because of the ongoing hype. There is a belief that this hype could rival that of artificial intelligence.

Will the metaverse tokens rally continue?

Decentraland MANA price jumped by more than 6% while Sandbox and Axie Infinity price soared by more than 5%. Similarly, Enjin and ApeCoin rose by over 4%. 

However, I believe that these gains will not hold because of a concept known as buying the rumor and selling the news. This is a situation where an asset price jumps ahead of a major news release and then declines when the news happens.

In this case, these tokens will retreat possibly because Apple’s device will not have anything to do with these tokens and their ecosystem.

How to buy Decentraland

Skilling

Skilling is a Scandinavian based cryptocurrency broker which has a desktop website as well as apps for iOS and Android devices. It supports over 50 cryptocurrencies and it has a demo account to allow users to gain familiarity with the platform. Skilling has no hidden fees, it is an officially regulated broker and it supports a wide range of payment methods.

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eToro

eToro is a global social investment brokerage company which offers over 75 cryptocurrencies to invest in. It offers crypto trading commission-free and users on the platform have the option to manually invest or socially invest. eToro even has a unique CopyTrader system which allows users to automatically copy the trades of popular investors.

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