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| Everything you need to make sense of the crypto markets and beyond By the CoinDesk Markets Team Edited by Lawrence Lewitinn, Managing Editor, Global Capital Markets July 23, 2021 Sponsored by Bitcoin (BTC) +1.3% $32,343 Ether (ETH) +3.3% $2,055 (Price data as of July 23 @11:00 UTC) If you were forwarded this newsletter and would like to receive it, sign up here.
Good morning, and welcome to First Mover. Here's what's happening this morning: Market Moves: Bitcoin Options Market Sees Low Chance of Record High This Year Options traders are pricing an 8% chance of the cryptocurrency rising to a new peak above $64,800 by Dec. 31.Technician's Take: Bitcoin Momentum Improves; Faces Resistance at $34K And check out the CoinDesk TV show "First Mover," hosted by Christine Lee, Emily Parker and me at 9:00 a.m. U.S. Eastern time. Today the show will feature guests: Mark Jeffrey, Guardian Circle CEO Brian Norton, MyEtherWallet COO Matt Bond, Banquet Co-Founder– Lawrence Lewitinn
Biggest Movers These are the biggest movers in the CoinDesk 20 over the past 24 hours:
Gainers: Tezos (XTZ): +8.8% Uniswap (UNI): +6.1% Aave (AAVE): +4.8%Stellar (XLM): +4.0% Losers: The Graph (GRT): -1.1%The CoinDesk 20 are 20 digital assets filtered from the larger universe of thousands of cryptocurrencies and constitute roughly 99% of the market by volume at eight of the largest and most trustworthy exchanges.
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Market Moves by Omkar Godbole Bitcoin Options Market Sees Low Chance of Record High This Year Bitcoin options are assigning a low probability to prices reaching record highs by year-end as volatility expectations continue to fall amid a dour mood in the market.
According to data source Skew, options traders are pricing an 8% chance of the cryptocurrency rising to a new peak above $64,800 by Dec. 31. The probability of bitcoin (BTC) trading in six figures is just 2%.
Some observers may feel the market is underpricing the probability, but the numbers need to be read in context with the recent price action. Bitcoin option probabilities (Dec expiry) (Source: Skew) Bitcoin has more than halved since peaking above $64,000 in mid-April. Bullish sentiment has weakened so much that the annualized rolling three-month basis (spot minus futures) in bitcoin futures listed on Binance fell to zero earlier this week. Futures listed on Binance, the world’s largest crypto exchange by trading volume, traded at a premium of nearly 40% during the height of the bull run.
The six-month implied volatility, or investors’ expectations for price turbulence, has dropped to a more than two-month low of 80% at press time, having peaked at 122% on May 17, Skew data show. Bitcoin six-month implied volatility (Source: Skew) That implies investors expect the price consolidation to continue for a while. The cryptocurrency has mostly traded in the $30,000 to $40,000 range for the past two months, barring occasional dips to $29,000.
Options market probabilities have a positive correlation with implied volatility: The greater the volatility, the higher the odds of bitcoin hitting certain levels.
A word of caution, however. As the name suggests, options probabilities are probabilities and can change quickly along with market conditions.
For example, for the first 10 months of 2020, the market consistently signaled a lower-than 10% chance of bitcoin jumping above $20,000 by Dec. 31. Nevertheless the cryptocurrency broke above the key level in mid-December and ended the year near $29,000.
At press time, bitcoin is changing hands near $32,300.
Options probabilities are calculated using the Black-Scholes formula based on metrics such as call option prices, strike prices, the price of the underlying asset, the “risk-free” interest rate on investments as U.S. Treasuries and the time to maturation.
Options are derivative contracts that give the purchaser the right, but not the obligation, to trade the underlying asset at a predetermined price on or before a specific date. A call option represents a right to buy, a put option the right to sell. Read the original story here: Bitcoin Options Market Sees Low Chance of Record High This Year
The CoinDesk Quarterly Review 2021 Q2
Most CoinDesk 20 assets, which constitute 99% of the crypto market by verifiable volume, ended the quarter with negative returns. Meanwhile, protocol development for the world's largest cryptocurrencies by market capitalization, Bitcoin and Ethereum, reached new milestones. CoinDesk Research's latest Quarterly Review dives into the trends, developments and technological progress that shaped the crypto markets from April to June 2021. The full report is now available from the CoinDesk Research Hub.
Technician's Take by Damanick Dantes, CMT Bitcoin Momentum Improves; Faces Resistance at $34K Bitcoin (BTC) is holding onto gains after a strong return above $30,000 on Wednesday. The cryptocurrency is starting to stall around $32,400 at press time and is up about 2% over the past week.
Short-term momentum is improving, albeit within an intermediate-term downtrend that began in April. Initial resistance is seen at the 50-day moving average near $34,000. Bitcoin daily price chart shows support and resistance levels with RSI (Source: TradingView) The relative strength index (RSI) on the daily chart is rising from oversold levels, which could keep short-term buyers active into the weekend.Resistance remains strong around $40,000, which Is near the top of the two-month price range. The weekly chart is not yet oversold, although downside momentum is starting to slow.
Read the original story here: Bitcoin Momentum Improves; Faces Resistance at $34K
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BOLO Be on the look out for some of these upcoming events: No major economic data scheduled today.
The cryptocurrency movement has never been so sprawling, reaching every corner of the planet. Crypto State by CoinDesk aims to connect with local communities to explore this movement of financial disruption and how it trickles down to every corner of the globe, from DeFi investment opportunities to alternative ways to transact and store wealth. We're making virtual stops with audiences in Nigeria, the Middle East and Southeast Asia this year. Register for the Crypto State virtual tour.
ICYMI In case you missed it, here are the most recent episodes of "First Mover" on CoinDesk TV: Sam Bankman-Fried on FTX’s $900M Funding Round; Largest in Crypto History, Paxos General Counsel on Stablecoin Risks and Regulations Fresh of a $900 million funding round, the largest in crypto history, crypto exchange FTX is now valued at $18 billion. What is the company planning to do with the money? Stablecoin risks and regulations are in focus as SEC Chair Gary Gensler hints some stablecoins are securities. FTX CEO Sam Bankman-Fried and Paxos General Counsel and Chief Compliance Officer Dan Burstein join "First Mover" to share their takes.
Latest Headlines BlockFi Is Pursuing Plans to Go Public – Even as Regulators Close InThe crypto lender is days away from closing a $500 million Series E, sources say. A timetable for a public listing is circulating among investors. IRS Tweaks Crypto Question Language on 2021 1040 Draft Form The revised question asking taxpayers about crypto assets is much simpler and clearer. Blockchain Protocol Thorchain Suffers Another Hack Totaling $8M Thorchain told CoinDesk a hacker deployed a custom contract that was able to trick the Bifrost into receiving a deposit of fake assets. Trump-Styled Magacoin’s Website Exposes Sensitive Details of New Users: Report A hacker was able to breach the websites' security where they exposed the email addresses and passwords of users who bought Magacoin. Nigeria’s Central Bank Says Its Digital Currency Pilot Will Start October 1 Rakiya Mohammed, the bank's information technology director, also said the bank may conduct a proof of concept before the end of 2021. Beijing City Blockchain Touts IPFS Interoperability Enterprise blockchain in China is receiving government support, while crypto mining is facing a crackdown.Kazakhstan Data Center Operator Enegix to Host Bitmain Machines The center, commissioned in late 2020, is Enegix's third location and is designed to host more than 50,000 mining rigs. Amazon Is Looking to Hire a Digital Currency Lead The successful candidate will have expertise in cryptocurrency and central bank digital currencies, according to a job posting.
Disclaimer: The information presented in this message is intended as a news item that provides a brief summary of various events and developments that affect, or that might in the future affect, the value of one or more of the cryptocurrencies described above. The information contained in this message, and any information liked through the items contained herein, is not intended to provide sufficient information to form the basis for an investment decision. The information presented herein is accurate only as of its date, and it was not prepared by a research analyst or other investment professional. You should seek additional information regarding the merits and risks of investing in any cryptocurrency before deciding to purchase or sell any such instruments. ATTENTION: Scammers have been sending fraudulent emails with links to sites disguised to look like coindesk.com. If you are in doubt about a link, type https://www.coindesk.com directly into your browser; do not copy and paste. Remember, if something seems too good to be true, it probably is.
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