News Updates September 24, 2022

1. Bitcoin Price Analysis: 19231 Big BTC Level. 

Bitcoin (BTC/USD) extended its recent sideways trading activity early in the Asian session as the pair continued to orbit the 19231 area, a level that represents the 76.4% retracement of the legacy historical appreciating range from 3858 to 69000.   The 50-bar, 4-hourly simple moving average and the 200-hour simple moving average has recently served as technical resistance after BTC/USD was capped around the 19949 area and supported around the 18153 area.  Following recent selling pressure, BTC/USD bears are eyeing a greater risk of a test of the 17567.45 low from earlier in June.  Following the recent sharp decline, the 20433 area has emerged as an area of consistent technical resistance and is technically related to selling pressure that commenced around the all-time high of 69000.   

Below current price activity. traders continue to anticipate large Stops below the 17803, 17701, 16966, and 16503 areas, significant technical levels related to historical upside pressure around the 3858 and 9819 areas. Additional significant technical areas on the downside include the 16990.14, 14500.15, and 10432.73 areas. Above recent price activity, upside retracement levels in the depreciating range from 31549.21 to 17567.45 include the 26208, 28249, and 28557 areas.  Additional upside price objectives and areas of potential selling pressure include the 25552, 26323, 26411, 26901, 27126, 27455, 28426, and 29669 areas.  Traders are observing that the 50-bar MA (4-hourly) is bearishly indicating below the 200-bar MA (4-hourly) and below the 100-bar MA (4-hourly).  Also, the 50-bar MA (hourly) is bearishly indicating below the 100-bar MA (hourly) and below the 200-bar MA (hourly).

Price activity is nearest the 100-bar MA (4-hourly) at 19070.23 and the 50-bar MA (Hourly) at 19342.86.

Technical Support is expected around 16990.14/ 14500.15/ 10432.73 with Stops expected below.

Technical Resistance is expected around 25256.96/ 27455.20/ 32383.96 with Stops expected above.  

On 4-Hourly chart, SlowK is Bearishly below SlowD while MACD is Bullishly above MACDAverage.

On 60-minute chart, SlowK is Bullishly above SlowD while MACD is Bullishly above MACDAverage.          

2.  The biggest Bitcoin fund just hit a record -35% discount — A warning for BTC price?
Institutional interest in Grayscale Bitcoin Trust continues to dwindle 10 months into the crypto bear market.

Grayscale Bitcoin Trust (GBTC), a cryptocurrency fund that currently holds 3.12% of the total Bitcoin (BTC) supply, or over 640,000 BTC, is trading at a record discount compared to the value of its underlying assets.

Institutional interest in Grayscale dries up
On Sep. 23, the $12.55 billion closed-end trust was trading at a 35.18% discount, according to the latest data.

To investors, GBTC has long served as a great alternative to gain exposure in the Bitcoin market despite its 2% annual management fee. This is primarily because GBTC is easier to hold for institutional investors because it can be managed via a brokerage account. 

For most of its existence, GBTC traded at a hefty premium to spot Bitcoin prices. But It started trading at a discount after the debut of the first North American Bitcoin exchange-traded fund (ETF) in Canada in February 2021.

Unlike an ETF, the Grayscale Bitcoin Trust does not have a redemption mechanism. In other words, GBTC shares cannot be destroyed or created based on fluctuating demand, which explains its heavily discounted prices compared to spot Bitcoin.

Grayscale's efforts to convert its trust into ETF failed after the Securities and Exchange Commission's (SEC) rejection in June. In theory, SEC's approval could have reset GBTC's discount from current levels to zero, churning out profits for those who purchased the shares at cheaper rates.

Grayscale sued the SEC over its ETF application rejection. But realistically, it could take years for the court to give a verdict, meaning investors would remain stuck with their discounted GBTC shares, whose value have fallen by more than 80% from their November 2021 peak of around $55.

A warning for spot Bitcoin price?
Grayscale is the world's largest passive Bitcoin investment vehicle by assets under management. But it doesn't necessarily enjoy a strong influence on the spot BTC market after the emergence of rival ETF vehicles.

For instance, crypto investment funds have attracted a combined total of almost $414 million in 2022, according to the CoinShares' weekly report. In contrast, Grayscale has witnessed outflows of $37 million, which include its Bitcoin, Ethereum, and other tokens' trusts.

3. Bear Market FUD Could Signal More Blood for These Large Cap Cryptos.

Data from Santiments claims that the FUD surrounding BNB, DOGE, BTC, and LINK could propel a breakout from them.
Several analyst suggest that Bitcoin’s price might shoot above $20k if it beats the FUD.
BNB’s price against Bitcoin as touched a new all-time high.

of a market recovery anytime soon.

Bear market wreaking havoc on prices
The ongoing bear market continues to play a huge part in price decreases across the industry. However, it seems that major caps are suffering the most as holders and community members begin to question if there is more blood in store for the market.

4. How Long Will U.S. Dollar Index (DXY) Continue to Rise?

The U.S. dollar index surged a record 3% during the week in the face of another interest rate hike.
The DXY has reached resistance at 113 and the top of the long-term parallel channel.
The crypto community comments on the DXY's parabolic rise.

The US Dollar Index (DXY) continues its parabolic rise. While it increased by 3% this week, commentators are asking when and at what level the dominance of the US currency will end. The strong dollar translates into a weak performance of other global currencies, traditional markets, and cryptocurrencies.

The Federal Reserve (Fed) continues its policy of financial tightening alongside persistently high inflation in the United States (US). This month saw another interest rate hike – this time by 75 basis points. The Fed’s decisions and the global macroeconomic situation favor the appreciation of the US dollar and the DXY index, which expresses its strength.

The DXY measures the strength of the U.S. dollar against a basket of six major foreign currencies. Among them are the euro, the Swiss franc, the Japanese yen, the Canadian dollar, the British pound, and the Swedish krona.

DXY parabolic rise
The US dollar index has been experiencing a parabolic rise since May 2021. The exact shape of the parabolic support line (blue) is not known, as it already seemed to have been broken early last month.

This seemed possible after the DXY reached the resistance area at the 109 level. However, it then only corrected by 4% and bounced off the 105 area, turning it into support (S/R flip). A few weeks later, it reached the 109 level again and finally broke out of it strongly this week, forming a record 3% green candle (blue arrow).

This is the largest weekly increase since March 16, 2020, when the DXY fired up at the start of the COVID-19 pandemic (red arrow). It is worth mentioning that such a steep rise was then a peak signal, after which the DXY experienced a 13.5% correction, reaching a low at 89. This decline, which lasted for 284 days, was at the same time a catalyst for growth in the cryptocurrency market at the turn of 2020-2021.

Currently, we see that the DXY has reached another area of resistance in the 112-113 range. If it is broken through, the next major area of resistance is only at 120 (orange line). This resistance is marked by the macro peak of early 2002.

On the other hand, on the monthly chart, we see a long-term rising parallel channel. Within this pattern, the aforementioned parabola is a sharp transition from the channel’s support line to its resistance. The median of the channel – the basic support in case of a correction from the top of the pattern – is currently in the 103 area.

Technical indicators
On the US Dollar Index RSI weekly chart, a multi-stage bearish divergence was developing, stretching back to May 2022. However, this week it was partially negated (red arrow).

Despite this, the current RSI value in the overbought area is 76.42, while in July it was 76.58. Therefore, even in the face of a huge increase, the bearish divergence may still be valid.

5. What is a cryptocurrency mining pool?
A fraternity-based approach to mine crypto, mining pools let miners combine their computational resources for a better chance to win rewards.

mining a block and share the rewards received among them. 

In existence since 2010, when Slush Pool was formed as the first Bitcoin mining pool, there are now many popular mining pools for cryptocurrencies like Ether (ETH), Zcash (ZEC), Bitcoin Cash (BCH), Bitcoin SV (BSV) and more to choose from.

Understanding the cryptocurrency mining process
Before we delve into what is a cryptocurrency mining pool and how an individual can join one, let us look at how cryptocurrency mining takes place and understand the key difficulties involved. 

Firstly, for any PoW blockchain protocol, the process of mining its native token involves solving math problems using computing power, where the correct answer is represented as the block’s hash number, and rewards are presented to the entity that solves the fastest. 

Since the reward for mining a Bitcoin block is 6.25 BTC, it is quite lucrative from a monetary perspective and has motivated many miners to increase their computing capacity by purchasing expensive ASIC miners. 

6. Merchant Crypto Payments: Clever Marketing or Signs of Real Adoption?

Earlier this year, all the news about digital assets was about the ongoing crypto winter, the bankruptcy of lenders and other projects, and major black swan events like Axie Infinity's Ronin bridge hack or the collapse of Terra's UST algorithmic stablecoin.

Surprisingly, a significant change could be observed in recent months. Despite the fact that cryptocurrency prices remain near the current market bottom, there has been quite some positive media coverage about the industry lately.

The reason for the latter is rather straightforward. In the last few months, a surging number of prominent businesses and government entities have started adopting digital assets for payments.

Accelerating business and state crypto adoption
In August, while Gucci expanded its list of supported digital assets with ApeCoin and the luxury resort chain Soneva started accepting major coins at its premises in the Maldives and Thailand, Oxford City has become the first non-league football club to integrate crypto for matchday payments.

 
 
 Source: AdobeStock / ra2 studio
 

Andrey Diyakonov is the Chief Commercial Officer at Choise.com, a MetaFi (CeFi/DeFi) ecosystem based on Crypterium CeFi solutions and Charism DeFi protocol.
__________

Earlier this year, all the news about digital assets was about the ongoing crypto winter, the bankruptcy of lenders and other projects, and major black swan events like Axie Infinity's Ronin bridge hack or the collapse of Terra's UST algorithmic stablecoin.

Surprisingly, a significant change could be observed in recent months. Despite the fact that cryptocurrency prices remain near the current market bottom, there has been quite some positive media coverage about the industry lately.

The reason for the latter is rather straightforward. In the last few months, a surging number of prominent businesses and government entities have started adopting digital assets for payments.

Accelerating business and state crypto adoption
In August, while Gucci expanded its list of supported digital assets with ApeCoin and the luxury resort chain Soneva started accepting major coins at its premises in the Maldives and Thailand, Oxford City has become the first non-league football club to integrate crypto for matchday payments.

 
Moreover, businesses have expanded crypto payment coverage in Australia and Argentina. –°itizens of the latter can now utilize a prepaid card brought about through a partnership between Binance and MasterCard to settle transactions at merchants via cryptocurrencies. Meanwhile, Aussies can now purchase fuel and other merchandise with their digital assets at On The Run's 175 premises.

At the same time, states are also increasingly realizing crypto payments' potential use cases and benefits. Of course, central bank digital currencies (CBDCs) continue playing a major role in governments' cryptocurrency adoption, especially if we consider how close China is to launching its digital yuan (e-CNY). While visitors and residents can leverage e-CNY to buy subway tickets in Ningbo and Beijing, bus fares can be covered with the state-issued digital asset in Guangzhou.

Clever marketing or real signs of crypto adoption?
Large brands like Gucci, Balenciaga, and Tag Heuer joining the ranks of companies like Microsoft, PlayStation, AT&T, and Subway to accept crypto is definitely good news for the industry.

However, before we imagine bitcoin (BTC) and other major cryptocurrencies "going to the moon", we should discuss whether this is a signal of real-world, no-fooling around adoption or just a marketing plot by brands.

Fortunately, the prior statement seems to hold the truth.

Whether they like it or not, big firms are adopting cryptocurrency for payments to fulfill consumers' surging demand. In Gucci's case, the luxury brand likely decided to integrate ApeCoin due to its customers' strong interest in the non-fungible tokens (NFTs) of the popular Bored Ape Yacht Club (BAYC) project, where top celebrities like Eminem and Snoop Dogg are actively involved.

Andrey Diyakonov is the Chief Commercial Officer at Choise.com, a MetaFi (CeFi/DeFi) ecosystem based on Crypterium CeFi solutions and Charism DeFi protocol.
__________

Earlier this year, all the news about digital assets was about the ongoing crypto winter, the bankruptcy of lenders and other projects, and major black swan events like Axie Infinity's Ronin bridge hack or the collapse of Terra's UST algorithmic stablecoin.

Surprisingly, a significant change could be observed in recent months. Despite the fact that cryptocurrency prices remain near the current market bottom, there has been quite some positive media coverage about the industry lately.

The reason for the latter is rather straightforward. In the last few months, a surging number of prominent businesses and government entities have started adopting digital assets for payments.

Accelerating business and state crypto adoption
In August, while Gucci expanded its list of supported digital assets with ApeCoin and the luxury resort chain Soneva started accepting major coins at its premises in the Maldives and Thailand, Oxford City has become the first non-league football club to integrate crypto for matchday payments.

 
Moreover, businesses have expanded crypto payment coverage in Australia and Argentina. –°itizens of the latter can now utilize a prepaid card brought about through a partnership between Binance and MasterCard to settle transactions at merchants via cryptocurrencies. Meanwhile, Aussies can now purchase fuel and other merchandise with their digital assets at On The Run's 175 premises.

At the same time, states are also increasingly realizing crypto payments' potential use cases and benefits. Of course, central bank digital currencies (CBDCs) continue playing a major role in governments' cryptocurrency adoption, especially if we consider how close China is to launching its digital yuan (e-CNY). While visitors and residents can leverage e-CNY to buy subway tickets in Ningbo and Beijing, bus fares can be covered with the state-issued digital asset in Guangzhou.

Clever marketing or real signs of crypto adoption?
Large brands like Gucci, Balenciaga, and Tag Heuer joining the ranks of companies like Microsoft, PlayStation, AT&T, and Subway to accept crypto is definitely good news for the industry.

However, before we imagine bitcoin (BTC) and other major cryptocurrencies "going to the moon", we should discuss whether this is a signal of real-world, no-fooling around adoption or just a marketing plot by brands.

Fortunately, the prior statement seems to hold the truth.

Whether they like it or not, big firms are adopting cryptocurrency for payments to fulfill consumers' surging demand. In Gucci's case, the luxury brand likely decided to integrate ApeCoin due to its customers' strong interest in the non-fungible tokens (NFTs) of the popular Bored Ape Yacht Club (BAYC) project, where top celebrities like Eminem and Snoop Dogg are actively involved.

Furthermore, with an estimated 320 million crypto users worldwide, many consumers have realized the benefits of crypto payments. Compared to conventional forms of payment, digital assets are cheaper and faster to transfer due to the lack of intermediaries in the transactions. At the same time, while users have direct ownership over their funds (provided they weren’t goofing around with their private keys) with non-custodial wallets, they don't have to use a bank account, a credit card, or other services of financial institutions to settle their payments.

For businesses, the advantages of crypto payments are even more obvious. Compared to traditional providers that typically charge between 1.5% and 3.5% for processing credit card transactions, a recent report revealed that it only costs enterprises approximately 1% to accept digital assets with a capable processor.

The savings in fees and the speed of transactions provide an excellent opportunity for merchants to reduce their bottom line. Furthermore, while they can target crypto-native prospects more efficiently, they face significantly fewer risks of unfriendly behavior, viz. fraudulent chargebacks, with digital assets-powered transactions.

Who will take the lead in crypto adoption?
In the coming months, I expect more luxury brands, especially those actively involved in the NFT and metaverse sectors, to follow in Gucci's footsteps and adopt crypto payments. Also, as demand among merchants grows, it will likely give one more reason for payment giants like MasterCard, Visa, and PayPal to introduce new or expand their existing digital asset offerings to fulfill enterprise demand.

At the same time, as the upcoming metaverses of tech firms like Meta and Microsoft are getting one step closer to their launch, we might witness an acceleration of crypto adoption in this field as well, where said assets might be utilized as a means of payment in virtual worlds. Now, how and whether – if at all – future-proven and regulation-resistant will those new efforts be, remains to be seen. Meta still hasn't fully recovered from the Libra blowback. How decentralized and peer-to-peer (P2P) those infrastructures are is yet another point of uncertainty.

Next year, we may also see some new government initiatives that aim to leverage the benefits of crypto payments in a similar way, spanning across the continents, from Iran through African states to Argentina's Mendoza province. However, I believe all those efforts will be slowed down by the focus that might be diverted to CBDC development.

For that reason, I expect businesses to take the lead in crypto payments adoption for the next few months – or at least until China completes the nationwide launch of the digital yuan, opening up the way to millions of new crypto users.

7. Crypto Regulation: California Kills Key Crypto Bill, Here’s Why?

California Governor Gavin Newsom vetoes Assembly Bill 2269 – a crypto oversight bill. The bill would have required crypto businesses and exchanges to acquire a special license from the California Department of Financial Protection and Innovation. The bill passed both the assembly(with a 71-0 vote) and the state senate. However, Newsom, who had until 30th September to make a decision, vetoed the bill.

The bill is similar to the law in New York which asks crypto companies to acquire a “BitLicense” for virtual asset services. Current New York mayor Eric Adams has criticized this provision, preventing New York from becoming a virtual assets hub.

The bill, called the Digital Financial Assets Bill, aimed to create more oversight over crypto companies in California.

Why Newsom Vetoed The Crypto Oversight Bill
In a letter to the California State Assembly, Newsom informed the legislative body that he will veto the crypto oversight bill. Newsom highlighted the increasing popularity of cryptocurrencies and reaffirmed the need for transparent regulation that can protect Californians.

Newsom revealed that his administration has conducted extensive research on approaches that can protect citizens from the risk of cryptocurrencies. However, Newsom believes that it is early to lock a licensing structure into a statute without considering his research. Moreover, the governor points to the upcoming federal mid-term election. He believes that a more flexible approach is needed that can foster a balance between protection and innovation.