News updates April 03, 2022
1. BTC Price Analysis: What’s Next For Bitcoin After the 200MA Rejection?
Despite being up about 5% on the day, BTC’s price took a beating in the past couple of days. It appears that the bulls are attempting to retake control, although the shot at $47K from earlier today has so far been unsuccessful.
Technical Analysis:
Bitcoin’s price is struggling to recover, and it is still trading below the 200-day moving average. This level is one of the most common indicators to determine whether an asset is in a bull or bear market. The cryptocurrency has been rallying in the past few weeks, and it even broke past the significant $45K resistance zone.
However, the 200-day moving average rejected it to the downside, and the price is currently being held by the $45K broken resistance level, which has now turned into support. If this level fails, a retest of the 50-day and 100-day moving averages would be the first target to the downside. On the other hand, if the price successfully breaks above the 200-day moving average, the $52K level would be the next significant obstacle.
4-hour timeframe:
On the 4-hour timeframe, it is evident that the price has been rejected from the top trendline of the large bearish flag pattern as the RSI was massively overbought. BTC has currently rebounded from the $45K level and is in a key range.
If a lower high and bearish trend is about to form, the $46K-$47K area would be a probable turning point. The RSI is also in equilibrium after recovering from a nearly oversold level following the impulsive drop from $48K.
Another bearish scenario would be for the price to form a relatively higher high, with RSI signaling a bearish divergence. Both scenarios would lead to a deeper correction to at least the $36K level and the lower trendline of the flag. A bearish breakout of this pattern would be the worst-case scenario as the price could drop to new lows below $33K. On the other hand, if the price breaks the pattern to the upside, both bearish scenarios would fail, and BTC might continue towards the $52K mark.
Onchain Analysis:
The most pervasive sentiment in international affairs over the last two years has been “uncertainty.” A worldwide pandemic, inflation-related fears, and, most recently, a geopolitical confrontation have all served as triggers for several unstable phases during the last two years.
It is often suggested to zoom out and look at the larger picture during times of uncertainty. The figure below, for example, depicts the bigger picture of Bitcoin’s supply dynamics based on the CryptoQuant data.
Realized Cap – UTXO Age Bands (%) is a measure that visualizes clusters of coins based on their lifetimes (the last time they were transferred) and their proportion of the overall realized cap. Coins ranging in age from three months to 5 years are displayed and distinguished by various colors, as mentioned in the chart’s narrative.
In summary, an increase in these age bands indicates HODLing and accumulation (green), while a decrease in them indicates selling and distribution (red) among mid to long-term holders.
The market is presently in an accumulation period, with the number of coins that have moved in the previous three months gradually growing.
2. Bitcoin (BTC) Volatility Has Never Been So Low, Quarterly Candles Say:
* Sideways for a year": Bitcoin (BTC) prints Doji candles on quarterly chart.
* Does Bitcoin (BTC) love April?
Bitcoin (BTC) supporters on Twitter are guessing at what a new pattern means and how it could affect Bitcoin (BTC) price dynamics in 2022.
"Sideways for a year": Bitcoin (BTC) prints Doji candles on quarterly chart:
Mr. Clemente, lead insights analyst at Blockware and popular crypto podcaster, has taken to Twitter to share the chart that displays Bitcoin (BTC) performance quarter by quarter on a logarithmic scale.
It looks like Bitcoin (BTC) printed two ultra-thin candlesticks in a row, a situation unseen in its history. Thus, the period from Q4, 2021, to Q1, 2022, may be less volatile for Bitcoin (BTC).
Mr. Clemente's Twitter followers shared various interpretations of this pattern that looks like what is called Doji Candlesticks among traders and analysts.
Some of them are certain that two thin candles are signaling massive consolidation, while other commentators indicate that this is a clear marker of Bitcoin's maturation as an asset.
Does Bitcoin (BTC) love April?
Bitcoin (BTC) closed Q1 2022, down 1.46% compared to Jan. 1. This is the smallest negative Bitcoin (BTC) quarterly price movement in its history.
In Q4, 2021, the orange coin added 5.45%, which is the second least significant positive quarter for Bitcoin (BTC): in Q3, 2018, the crypto king gained 3.61% in 90 days.
Typically, April is a green month for a first cryptocurrency. It closed April in the red only three times in 10 years with 1.6-3.4% losses.
At the same time, for four years in a row, April was bringing 33-35% gains to the flagship cryptocurrency. Should this happen again, Bitcoin (BTC) might easily return to levels over $62,000.
Blockchain Analyst & Writer with scientific background. 6+ years in IT-analytics, 3+ years in blockchain.
Worked in independent analysis as well as in start-ups (Swap.online, Monoreto, Attic Lab etc.)
3. Is Bitcoin a hedge against inflation?
1) Why do you need a hedge against inflation?
How effective is Bitcoin as a hedge against inflation? Let us first understand what inflation is and how useful the other stuff is to deflate it.
With inflation in fiat-based economies a given, experts and even regular people have been looking for an investment or a tool that works as a hedge. Gold, stocks and real estate have long brought respite to investors who are ever afraid of losing value to inflation. It will be apt to say that these commodities always have had their limitations as a hedge.
As of late, however, bullions, or commodities like gold and silver, have come across to be less reliable over small investment horizons. In 2021, bullion steadily lost ground. Real estate has low liquidity and higher transaction costs and requires continual management and maintenance. Regarding stocks, they require investors to have sophisticated financial skills and the majority of regular people lack the skill set for being an efficient stock manager.
2) What is inflation?
Inflation is when the purchasing power of the local currency goes down. A popular metric used for measuring inflation is the Consumer Price Index (CPI).
Inflation refers to rising prices of goods and services, leading to a decline in purchasing power of the local currency. As a result, more units of a currency are needed to purchase a certain item. For instance, a fruit basket might have been priced at $5.00 a few years before. Now, the same basket carries a price tag of $8.00, indicating a drop in purchasing power.
The following chart indicates how prices of a few items skyrocketed between 1960 and 2021 in the United States:
The Consumer Price Index (CPI) is a popular metric used to measure inflation, exploring the weighted average of various price baskets of goods and services. The CPI metric affects interest rates, wages, state benefits, tax allowances, pensions, maintenance, contracts and other payments.
3) Ways to hedge against inflation.
Putting money in store of value investments like gold, real estate, stocks and crypto helps curb inflation.
As cash loses purchasing power over time, keeping cash leads to people losing their savings. This has prompted people to put their money in store of value investments such as gold, real estate, stocks and, now, crypto. Will Bitcoin protect against inflation has been a question in the town ever since.
To be held as a store for value, an asset should be able to hold its purchasing power over time. In other words, it should increase in value or at least remain stable. Key properties associated with such assets are scarcity, accessibility and durability.
Gold as a hedge against inflation:
During past inflationary periods, gold has had a mixed track record. In the 1980s, there were times when holding gold gave negative returns to owners.
Morningstar data gives a peek how gold has had a spotty track record during past inflationary periods. A commodity that is supposed to hedge against inflation is expected to rise when consumer prices are going up. During periods of high inflation, particularly in the 1980s, there were times when gold owners ended up fetching negative returns.
In recent times, gold has slowly lost its luster as a hedge. During the pandemic and even when waves have subsided, people are showing less interest in gold. It is still viewed as good enough for holding value in the long term, but for the short term, the metal is seen as less reliable now.
Real estate as a hedge against inflation:
The popping of the U.S. housing bubble underlined that real estate couldn’t always be trusted as a hedge against inflation.
For a long time, real estate has been regarded as an effective hedge against inflation. This myth, however, was busted in the United States housing bubble. In March 2007, home sales and prices in the country suffered from a sharp fall. As National Association of Realtors (NAR) data reveals, sales dropped 13% to 482,000 from the peak of 554,000 in March 2006.
In America and around the world, real estate prices are closely linked with factors like government policy, political and economic stability of the country, local demographics and economy, geographical location and infrastructure, among others. Parameters are simply too many for a regular person to understand.
Stocks as a hedge against inflation:
Long-term investment in stocks helps in tiding over the effects of inflation. Just make sure that the company has strong fundamentals.
Some stocks do help protect the value of your investment. Even if these stocks get hit by impatient investors in the short term, they recover well over time. But you need to factor in that not all stocks work well for hedging inflation. You need to find companies that have strong fundamentals and are more likely to draw better dividends for their shareholders.
4) Is Bitcoin a good inflation hedge?
Bitcoin is an effective hedge against inflation, thanks to limited supply and decentralization. These factors bring in scarcity and resilience power.
When looking into the query Can Bitcoin prevent inflation? Two major factors you need to consider are limited supply and decentralization.
Limited supply – bringing scarcity:
The supply of Bitcoin (BTC) has been algorithmically capped to 21 million coins. By the end of 2021, 18.77 million BTC have already come into circulation. In other words, 83% of the Bitcoin that could come into existence had been mined within 12 years of the inception of the cryptocurrency.
5) How does a rise in inflation impact Bitcoin prices?
Since its inception, the value stored in Bitcoin has increased more rapidly than the inflation itself.
Investors view Bitcoin as a tool to beat inflation though the objective of individual investors might be different such as to book profits, grow their wealth or use it as a store of value. As the exponential increase in Bitcoin prices reveals, the value stored in the cryptocurrency has increased faster than the inflation itself. Even in 2021 — a modest year for Bitcoin — the cryptocurrency grew at 59.8%, considerably better than inflation in most countries.
6) Does Bitcoin work as a hedge against inflation?
Statistics reveal Bitcoin has worked wonderfully well against inflation, much better than assets such as gold, real estate and stocks.
As an asset, Bitcoin works amazingly well against inflation and beats it by a big margin, though you should be careful about extraneous factors like the regulatory environment. Statistics reveal that the odds are much better while storing value in Bitcoin than assets like gold, real estate, stocks and others.
Underlying strengths like limited supply and decentralization propel Bitcoin to a unique position as an asset that can keep inflation at bay.
4. India's Crypto Trading Volume Plummets as New Tax Rules Enter Into Force:
Crypto trading volumes in India have plummeted following the new tax law entering into force. The new rules impose a 30% flat tax on crypto income and do not allow losses to be offset against gains.
New Crypto Tax Rules in Effect:
The new crypto tax rules entered into force on April 1 after the country’s parliament approved Finance Bill 2022. A flat tax of 30% now applies to crypto income with no deductions or loss offsets allowed.
On April 1, crypto exchanges in India began seeing sharp declines in trading volumes. Aditya Singh, who runs the Youtube channel “Crypto India,” posted screenshots on Twitter showing a sharp decline in trading volume at four major cryptocurrency exchanges in India: Coindcx, Bitbns, Zebpay, and Wazirx.
This is just the start of the decline of such a great ecosystem that we had in India,” Twitter user Shivam Chhuneja commented. “Our government must think about taxation rules that bolster the industry and their tax revenue at the same time. Many people earn their living form crypto trading.”
India’s finance ministry explained in Lok Sabha, the lower house of parliament, last week that “no deduction in respect of any expenditure (other than cost of acquisition) or allowance is allowed.” Furthermore, losses from crypto transactions cannot be offset against gains.
Ashish Singhal, co-founder and CEO of crypto trading platform Coinswitch, commented:
A flat 30% tax that does not differentiate short-term capital gains from long-term gains, with no provision for deducting expenses incurred or offsetting losses is not in tune with the tax framework for other asset classes and is discriminatory.
Crypto supporters in India have petitioned on Change.org for the government to introduce reasonable crypto tax policies. At the time of writing, the petition has garnered more than 103K signers.
On July 1, another damaging tax provision will come into effect. A 1% tax deducted at source (TDS) will be imposed on crypto transactions. An Indian parliament member recently explained why this is detrimental to the crypto industry.
5. Report: Best cities for a career in crypto, NFTs and metaverse:
A few days ago, gambling company MrQ compiled a report on the world’s best cities for a career in crypto, NFTs and metaverse. The analysis involved parameters such as average salary, number of job vacancies and number of related businesses, as well as average download speed.
MrQ report reveals the best global cities for crypto, NFTs and metaverse:
The crypto industry is booming thanks in part to the NFT and Metaverse sectors that continue to emerge and grow, predicting a bright future for this industry and those who obviously work in it.
That’s why MrQ analyzed multiple parameters to find out which are the best cities in the world to pursue a career precisely in the crypto, NFT and metaverse industries.
NFT careers: Singapore in first place, followed by London:
In the Non-Fungible Token sector, which exploded in 2021, Singapore appears to be the best city in the world to work in, resulting with the second highest number of NFT jobs combined with the number of businesses related to NFT, Crypto and the metaverse.
Not only that, in Singapore the average annual salary for this job is also the sixth best in the world, with an impressive $66,050.
Next is London, with its annual salary being even better than Singapore, at $77,400.
In terms of the highest paid cities for an NFT career, Sydney and Melbourne have salaries of over $93,877 and $82,096 respectively. In Europe, on the other hand, Amsterdam, London and Hamburg are the cities to move to if you want to earn significantly in the NFT industry, with salaries of $77,865, $77,400 and $75,377, respectively.
Looking at the ranking in reverse there are Colombia, Portugal, Mexico and the United Arab Emirates which are the worst paid for a career in NFTs.
Crypto and metaverse: the best cities in the world for a career;
And if a career in the crypto sector were the object of study, the history to be examined spans 14 years, with the invention of Bitcoin in 2008. Well in this case, it is the United States that seems to dominate the ranking of the best cities in the world, with Denver at the top.
Then again, the US is also home to Mark Zuckerberg who renamed his global Facebook business to Meta Platforms in October 2021, claiming he wants to develop in the metaverse. But it seems that the new dimension has not been confined to the United States.
In fact, when it comes to the metaverse, Singapore, London and Hong Kong occupy the top three positions as the best locations to pursue a career in this sector.
All three locations host the most job openings, with London coming in first place with 332, which is more than double the number of Singapore coming in second with 149.
Surprisingly, Mexico City tops all other locations analyzed with an average annual earning potential of $317,332, followed by Sydney with $96,608 and Melbourne in third with $92,052.
Gen Z and their increasingly tech-savvy habits:
Recently, Thunes also revealed in its report the living, buying and financial habits of the most digitally savvy, Gen Z, the most populous generation on the globe.
Gen Z is the most populous generation on the planet. It is the 16-24 year olds who do not know life without internet and smartphones, and who seem to be forcing the change in society in favour of technology.
In fact, Gen Z is increasingly involved in social media, both for everyday life, but also for shopping and, in some cases, even for earning money. Not only that, the report revealed that as a method of payment, Zoomers prefer mobile wallets to traditional bank accounts and cash.
6. Central banker conference to examine 'safe DeFi' and CBDCs next week
A group of central bank officials is set to discuss decentralized finance and CBDCs during a virtual event on Monday.
The Bank for International Settlements (BIS) will livestream a conference from Zurich called "Does Safe DeFi Require CBDCs?" The event will examine how DeFi markets may evolve and what roles central banks and Central Bank Digital Currencies may play in creating a secure environment.
