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| December 2, 2020 Everything you need to make sense of the crypto markets and beyond Sponsored By: By the CoinDesk Markets Team Edited by Bradley Keoun If you were forwarded this newsletter and would like to receive it, sign up here. Bitcoin (BTC) +1.8% $19,113 Ether (ETH) +2.5% $575 (Price data as of Dec. 2 @11:31 UTC) TODAY: Price Point: Bitcoin was higher though lacking vigor after hitting an all-time high earlier this week. Market Moves: XRP soared 169% in November, topping performance of the CoinDesk 20 digital assets during a month when bitcoin dominated headlines. Bitcoin Watch: Options market shows some traders are positioning for a market correction, CoinDesk's Omkar Godbole writes. What's Hot: BlackRock's Larry Fink weighs in on bitcoin, institutional bitcoin shop NYDIG raises $150M, Libra rebrands as "Diem," new $908B U.S. stimulus proposal emerges.
Price Point Bitcoin was higher, in an indecisive-looking market swinging between about $18,300 and $19,300. Prices have failed to push higher after surging to a new all-time high of $19,920 earlier this week.
"Expect additional short-term volatility," Katie Stockton, a technical analyst for Fairlead Strategies, told CoinDesk's Daniel Cawrey.
In traditional markets, European stocks slipped and U.S. stock futures pointed to a lower open as lawmakers discussed new economic-stimulus measures and traders awaited new data on U.S. jobs growth during November. Gold strengthened 0.7% to $1,827 an ounce.
The 10-year U.S. breakeven rate, representing inflation expectations as implied by bond markets, rose to 1.81% on Tuesday, the highest since July 2019.
Market Moves As bitcoin dominated headlines in November with its rally toward an all-time high, one of the most prominent alternative cryptocurrencies, XRP, quietly jumped 169% during the month to top the performance rankings among digital assets in the CoinDesk 20.
The move left XRP, the payments token used in Ripple’s global payments network, up 225% in 2020, versus the older and larger bitcoin’s 165% gain. XRP has a market capitalization of $21.4 billion, a fraction of bitcoin’s roughly $350 billion.
The frenzy may be driven by a looming airdrop of free “spark” tokens to anyone who holds XRP, some digital-markets analysts told CoinDesk last month.
There’s also the possibility that some first-time cryptocurrency buyers are unaware that it’s possible to buy a fraction of a bitcoin (BTC, +0.35%) – divisible up to the eighth decimal, instead of a whole token. For the novice investor, XRP, currently changing hands at 62.3 cents, looks a lot cheaper on a price table than bitcoin’s $19,087.
“As the digital asset space has seen renewed interest in the second half of 2020, a new wave of investors are looking for ways to get exposure,” said Brian Mosoff, CEO of the publicly traded Canadian investment fund Ether Capital. “Ripple appears to offer exposure in their portfolio, and a quick Google search may result in some users believing XRP is cheap and likely to become a product banks utilize for cross-border settlement.”
Stellar (XLM, +1.21%), another payments token founded by Ripple co-founder Jed McCaleb, was the second-best performer in November among the CoinDesk 20, gaining 153%. It’s up 313% on the year.
For comparison, bitcoin rallied 40% in November while ether, the native cryptocurrency of the Ethereum (ETH, +1.43%) blockchain, rose 56%. - Bradley Keoun CoinDesk 20 asset returns for November 2020. (CoinDesk)
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Bitcoin Watch Bitcoin daily price chart showing market pause after surge to all-time high. (TradingView/CoinDesk) Bitcoin's price rally looks to have stalled, triggering fears of a temporary price drop.
The leading cryptocurrency fell nearly 4.5% on Tuesday, snapping a three-day winning streak. The decline confirmed a negative divergence (lower highs) on the 14-day RSI, which often paves the way for price pullbacks.
Options market activity shows some traders have positioned for correction. Asia hours saw continued buying in December expiry put options at $14,000 and $15,000 strikes, according to Deribit Insights. However, significant selling was seen in the put option at the $19,000 strike during the early European trading hours. A put option is usually sold when the market is expected to rally or consolidate.
The latest options market activity shows traders stand divided on the next move in bitcoin.
As per technical charts, support is located at $18,279 (Tuesday's low), followed by $16,317 (Nov. 26 low). The cryptocurrency has traded well within Tuesday's price range of $18,279 and $19,920 so far today.
On the higher side, the psychological level of $20,000 is the level to beat for the bulls. - Omkar Godbole
Read More: Bitcoin Sees Record Number of Active Users as Price Almost Hits $20K
Token Watch Ether (ETH): Price correlation with bitcoin holds strong during latest rally.
Bitcoin (BTC): Larry Fink, CEO of money management giant BlackRock, tells former Bank of England Governor Mark Carney at Council on Foreign Relations that bitcoin has "caught the attention" of many people and could "evolve" into a global asset.
USD Coin (USDC): Centre, overseers of standards for dollar-based stablecoin USDC, hires former CLS, JPMorgan, State Street executive David Puth as first CEO.
What's Hot Institutional bitcoin shop NYDIG raises $150M for twin crypto funds (CoinDesk) Not so fast! CoinMarketCap says bitcoin prices haven't yet topped the all-time high based on its own records, at $20,089 in December 2017 versus CoinDesk's old $19,783 (and now $19,920) using the Bitcoin Price Index (CoinMarketCap) Almost 20% of PayPal users have used app to trade bitcoin, Japanese securities firm Mizuho says (CoinDesk) Russia says digital ruble will be only token allowed as form of payment in country, with law banning use of cryptocurrencies for payment set to take effect in January (CoinDesk) Blockchair lead developer Zhavoronkov mounts campaign to stop Taproot upgrade on Bitcoin network (CoinDesk) Libra Association rebrands to "Diem" in effort to distance itself from Facebook-led stablecoin push that brought international regulatory backlash (CoinDesk) Cryptocurrency derivatives platform ErisX launches cash-settled contracts after physically settled futures fall flat (CoinDesk) "We have built money for a world that’s geographically divided, but that’s not the word we live in anymore," Ajit Tripathi writes in op-ed (CoinDesk Opinion) BlockFi announces early 2021 launch for bitcoin rewards credit card (CoinDesk) Hottest debate on Wall Street is whether to buy bitcoin or gold (Bloomberg)Australian crypto exchange BTC Markets accidentally exposes personal data of 270K users (CoinDesk)
Analogs The latest on the economy and traditional finance European Central Bank chief economist privately gave dovish assurances to Goldman Sachs, JPMorgan, Citigroup, UBS, Deutsche Bank, BlackRock after ECB President Lagarde publicly made comments on Italian bond market, economy's health that were seen by investors as hawkish (WSJ) Bipartisan group of U.S. senators introduce new stimulus proposal worth about $908 billion (Washington Post) In global markets, "everyone already expects everything to be really fantastic," implying the optimism is already priced in, columnist James Mackintosh writes (WSJ) Japan wants to attract foreign talent in the financial sector by slashing income taxes (Nikkei Asia Review) Huawei Technologies gets foothold in Southeast Asia after partnering with Indonesian government (Nikkei Asia Review)
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