Bitcoin Holds Tightly Below $20K; Blockchain Protocol Cardano Arrives at Robinhood. Who cares?
Good morning. Here’s what happens:
Prices: Bitcoin and Ether Spend the Weekend in a Tight Trading Range Below $20K; investors will have few significant economic indicators to consider before the next US inflation figures next week.
Insight: Blockchain Protocol Cardano’s arrival at Robinhood seems like a big yawn, given the protocol’s lack of achievements.
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Prices
●Bitcoin (BTC): $19,927 +0.5%
●Ether (ETH): $1576 +1.1%
●S&P 500 daily close: 3,924.26 -1.1%
●Gold: $1,719 per troy ounce +0.6%
●Ten-year Treasury yield daily close: 3.19% −0.07
Bitcoin, Ether and Gold prices are taken at approximately 4pm New York time. Bitcoin is the CoinDesk Bitcoin Price Index (XBX); Ether is the CoinDesk Ether Price Index (ETX); Gold is the spot price for COMEX. Information on CoinDesk indices can be found at coindesk.com/indices.
Bitcoin’s Quiet Weekend Below $20,000
By James Rubin
Bitcoin settled below $20,000 over the past three-day US summer holiday weekend
The largest cryptocurrency by market capitalization was recently trading at around $19,900, up a few percentage points over the past 24 hours and roughly where it ended on Friday. BTC has held support at around this level for a week as investors eyed employment data that could give them some clues about the US Federal Reserve’s next interest rate intentions later this month and the wisdom of committing to higher risk assets.
“We continue to see Bitcoin struggling to maintain $20,000 support,” Joe DiPasquale, CEO of crypto-asset manager BitBull Capital, wrote in an email to CoinDesk.
DiPasquale called bitcoin’s current range “good … to begin accumulation,” although he recommended “being aware of further declines” that could occur around September 13, when the Bureau of Labor Statistics publishes the August Consumer Price Index (CPI).
Ether maintained a similar level of crypto price stasis with a little more than half of the US Labor Day weekend over. The second-largest cryptocurrency by market capitalization recently changed hands just below $1,600, up about 1% from the previous day, but roughly where it ended Friday. ETH investors are now awaiting the Bellatrix upgrade on Tuesday. This improvement on the Beacon Chain will be responsible for setting the rest of the Merge process in motion. The merger will shift ether from proof-of-work to a more energy-efficient proof-of-stake protocol.
Other altcoins were mostly in the green with ADA, ATOM and SHIB recently up over 4% in the last 24 hours. The original token for GMX, a decentralized exchange on Arbitrum, rose more than 9% and has risen significantly in recent weeks.
Stock
US stock markets closed Friday after the Labor Department’s latest jobs data gave little hope that the Federal Reserve, which has raised interest rates by a hefty 75 basis points at its last two Federal Open Market Committee (FOMC) meetings, would dial back its hawkishness. . The tech-heavy Nasdaq, S&P 500 and Dow Jones Industrial Average (DJIA) all fell more than a percentage point and have fallen for three weeks in a row. The US markets will be closed on Monday.
The Department for Supply Management will release its monthly service index on Tuesday with expectations for a slight decline. And the US Census Bureau will release its wholesale report for July.
Crypto news
On Saturday, MicroStrategy Executive Chairman Michael Saylor told an audience at the Baltic Honeybadger conference in Riga, Latvia that the non-crypto arm of the software firm is also working on bitcoin-related projects. The company’s developers are working on solutions that will allow a large number of people to enter the Lightning network, a payment network on top of bitcoin that allows faster and cheaper transactions.
CoinDesk’s Jocelyn Yang reported that unusual blockchain data appears to show large blocks of bitcoin worth more than $200 million moving for the first time in years, leaving cryptoanalysts wondering about its significance. On August 28, according to a post by crypto data analysis platform CryptoQuant, 5,000 BTC that hadn’t moved in at least seven years was transacted. The next day, LookIntoBitcoin’s data tracker showed another 5,000 BTC transferred again.
And the saga of troubled crypto lender Celsius Network continued as the company, which is going through bankruptcy proceedings, said in a legal filing Thursday that a newfound cash pile of $70 million is likely to help it continue operations until the end of 2022. According to the document Celsius expects “approximately $70 million in proceeds from the repayment of USD-denominated loans.”
BitBull’s DiPasquale remains wary of predicting any long-term upward crypto price movement. “If the current macroeconomic conditions persist, we may see an extended period of consolidation for crypto and markets in general, as opposed to a sharp recovery,” he wrote.
Biggest winners
Biggest losers
Insight
Cardano on Robinhood? So what
By Sam Reynolds
Robinhood recently announced that it is listing Cardano (ADA) on its trading platform, which has generated all kinds of buzz and bullish predictions of a price breakout.
Of course, talk of the ADA and price breakouts sometimes seems as old as crypto itself: The token, according to its faithful, is always on the cusp of something big.
But the reality is that an outbreak has not yet occurred. ADA, despite launching in 2017, only introduced smart contracts last year. Smart contracts are what make blockchains useful; the maturity of smart contract framework on Ethereum can be directly linked to the value of Ether.
And even after smart contracts were launched on the ADA, nothing happened. DeFi Llama shows that the total value locked (TVL) in Cardano is only $81 million. Compared to TVL locked in other protocols, this is less than a rounding error (or in the case of Solana, a double-counting scheme).
In the time since ADA’s launch, other protocols have far surpassed it for utility and for market confidence in them. Clayton, which is relatively unknown outside of Korea, launched in late 2021 and has a TVL of $357 million. Avalanche, launched in September 2020, has $1.8 billion in TVL.
Although Tron, which is synonymous with shitcoin, and whose founder’s name is closely associated with a get-rich-quick scheme, has a TVL of $5.7 billion – much more than ADA.
Market cap is a measure of the value of tokens in circulation, not the value locked in the protocol’s code.
To be sure, Cardano founder Charles Hoskinson, always seems to draw a crowd wherever he goes, and this charisma and his past achievements (some falsified as journalist Laura Shin recounts in her latest book) may largely explain the protocol’s allure and $15 billion market value. Investors are often drawn to entrepreneurs with a large presence.
Based on Cardano’s current advantages, nothing else accounts for the attraction.
Important events
US Labor Day holiday
08:30 HKT/SGT(12:30 UTC): Jibun Banking PMI (August)
09:45 HKT/SGT (13:45 UTC): Caixin Services PMI (August)
CoinDesk TV
In case you missed it, here’s the latest episode of “First Mover” on CoinDesk TV:
Bitcoin hovers around $20,000 as US adds 315,000 jobs in August; Ethereum energy consumption
“First Mover” Dove into the Crypto Markets After the August Jobs Report. While the US added 315,000 jobs last month, the unemployment rate rose to 3.7%. What does this mean for crypto markets? Path Trading Partners Chief Market Strategist Bob Iaccino provided his analysis. Hodder Law Firm’s Sasha Hodder also discussed issues before the court in the Celsius bankruptcy case, such as whether the crypto lender’s escrow account holders will get their money back. Plus, what will “The Merge” upgrade do to Ethereum’s energy consumption?
Headings
Australian CBDC research project could bring crypto clarity, legal expert says: Michael Bacina, partner at law firm Piper Alderman, joined CoinDesk TV’s “First Mover” to discuss why the country is the best place to test asset digitization.
US job growth slowed in August; Bitcoin gains: The report is one of the last major economic data points the Federal Reserve will see before its monetary policy meeting in September.
Did Merge Optimism Lift Ether or Was It the S&P 500?: The summer in the stock markets likely contributed to battered crypto bulls cheering on Ethereum’s impending technological upgrade.
Coinbase mispricing allows users in Georgia to withdraw at 100x rate: The glitch saw Georgia’s national currency, the lari (GEL), priced at $290 instead of $2.90.
Longer readings
TradFi Investors Will Love Ethereum’s Merger: The impact of the big shift to proof-of-stake has not been priced into the market for ether, says CoinDesk’s chief content officer.
Other voices: El Salvador had a Bitcoin revolution. Hardly anyone showed up (Bloomberg)
Said and heard
“We know that despite the moribund state of the markets, many hedge funds, family offices, venture funds and even pension funds and endowments are seriously looking at the long-term benefits of including crypto in their portfolios. Below I explain why post-merger ether can play a prominent role in their future allocations.” (CoinDesk Chief Content Officer Michael Casey) … “Then call me the world’s happiest cynic, because when I predicted the complete and catastrophic failure of Facebook’s rebranding as “Meta” that started less than a year ago, I really didn’t think it all would unravel as quickly and uncannily as it has. Horizon Worlds, Meta’s intended metaverse, went live in December, and oh my, it’s been downhill from there.” (CoinDesk columnist David Z. Morris) … .@MicroStrategy’s R&D is now working on enterprise-class applications of the #LightningNetwork technology, including the enterprise Lightning wallet, @saylor said at #BH2022 . (CoinDesk investigative reporter Anna Baydakova)
