2023-12-01 20:34:28
This week, the bitcoin exchange rate has already reached the level of 39,000 dollars. However, in the last seven days, the market actually calmed down without any major developments. The total value of the market already exceeds 1,500 billion dollars. And most of the gains came from Bitcoin, which tested the $39,000 level for the first time in a long time. The best-known cryptocurrency was able to grow by a modest 1% during the last seven days, the real growth came rather at the end of the week, in the last 24 hours. The price of BTC BTC PRICE started to wink in the direction of $39,000 on Friday. We haven’t seen this exchange rate level on the graph since last year. Macro market events are behind the exchange rate movement this week. Top cryptocurrency news of the week in one place FTX has received court approval to sell its remaining assets for $800 million. The bankrupt cryptocurrency exchange is preparing to sell assets managed by Grayscale in the future. Richard Teng, the new CEO of Binance, has already shared his vision for the future of the company. According to him, Binance will eventually evolve into a traditional financial company. Thus, after many years – and criticism – Binance will have a board of directors and an address. And in addition, the world’s largest trading platform will receive increased financial transparency, according to the new CEO. Meanwhile, crypto exchange Binance will end support for the BUSD stablecoin on December 15. Binance users can redeem BUSD coins until February 2024, but payouts will last on December 31, 2023. After that, all existing BUSD balances will be converted to FDUSD. OKX – currently the fifth largest crypto exchange in the world – has released the platform’s thirteenth Proof of Reserves report, which provides information on users’ assets. According to the November 23rd report, the amount of customer money increased enormously compared to the previous month. The new clients were certainly acquired through the uncertainty surrounding Binance by OKX absorbing clients leaving Binance. MicroStrategy – the NASDAQ-listed business intelligence software company headed by one of Bitcoin’s most vocal supporters, Michael Saylor, recently bought $600 million worth of BTC. With this purchase, the company now owns 174,530 BTC and has made a billion profit on its bitcoin investments. Bitcoin and oil exchange rate relationship Despite OPEC announcing further reductions in production quotas, oil prices fell this week. The reason for the unexpected decline is that the reduction in production is voluntary for members. This voluntary nature leads to uncertainty, because it is not known in advance who will support its adoption. Disagreements and tensions within OPEC have increased recently. Some member countries, such as Angola, have already announced that they do not intend to meet the reductions. OPEC decisions and the price of oil The price of oil is quite an important indicator regarding the future of bitcoin. Let’s see what the exchange rate of bitcoin and oil have to do with each other. Looking at the impact of lower oil prices on Bitcoin, we can observe two positive effects. First, the decrease in energy costs is beneficial for Bitcoin mining. Since energy is an ever-present variable cost in mining, lower electricity prices increase mining profitability. This has a double effect. The relationship between Bitcoin and oil On the one hand, miners are now less motivated to sell their newly mined bitcoins because lower energy costs leave more profits in their pockets. Consequently, the selling pressure on bitcoin in the market is reduced. On the other hand, increased profitability also makes mining more economical and attracts more miners to the network. And this contributes to the further decentralization and security of the Bitcoin network. Which ultimately leads to increased acceptance. Secondly, it is worth examining the relationship between lower oil prices and lower inflation. Lower oil prices can lead to lower inflation, and paradoxically, this can make risk assets like Bitcoin more attractive. In theory, lower inflation should reduce demand for assets like Bitcoin, which are generally viewed as inflation hedges. In practice, however, Bitcoin’s role goes beyond mere protection against inflation. It is also considered a risk instrument, characterized by a long maturity and relatively high volatility. In times of lower inflation and potentially lower interest rates, risk assets become more attractive. In particular, Bitcoin can become attractive, as it does not carry corporate risk, i.e. there is no concern about income expectations in a possible recessionary environment. Despite the above insights, it remains a challenge to draw a clear and direct link between Bitcoin and energy prices. This is mostly a problem due to the complicated and unpredictable nature of market factors. While lower oil prices may initially lead to low global economic growth, any correction in the crypto market is expected to be short-lived. Positive forces such as the increased profitability of mining and the broader appeal of venture assets such as Bitcoin in a lower inflation environment are expected to prevail eventually. And this contributes to the flexibility of the cryptocurrency market as a whole. There was a massive withdrawal of crypto from the exchanges The profit in the crypto market exchange rate in the past day was also accompanied by an increased level of withdrawals from the crypto exchanges. Bitcoin withdrawals from crypto exchanges are at a peak According to CryptoQuant, for example, nearly $1.28 billion worth of Bitcoin left crypto exchanges in the last two weeks. The decline in Bitcoin balances across crypto exchanges has largely coincided with rising prices. This indicates that traders are still depositing their Bitcoins. This further reduces the selling pressure on the market. The crypto market boom coincides with MicroStrategy’s announcement that it bought nearly $600 million worth of Bitcoin at an average price of $36,785 per BTC BTC PRICE . This acquisition brings the company’s total BTC holdings to over $6 billion. In addition, expectations regarding the Federal Reserve’s pause in interest rate hikes can now significantly influence the exchange rate. Jerome Powell’s Power Is Greater Than You Think People often wonder why markets are so volatile when the chairman of the Federal Reserve speaks. Volatility is often experienced during his speeches, as traders try to decipher the future direction of interest rates. Why are traders interested in this? As head of the central bank, which controls short-term interest rates, Jerome Powell has more influence over the value of the world’s largest economy’s currency than anyone else. Traders scrutinize all of Powell’s public engagements. In fact, it is almost as if they are trying to predict future monetary policy expectations from coffee beans. According to experts, you can hear the tone of the words. Yes, we are already at the point where Powell’s tone is used to decipher the US central bank’s monetary policy plans. If the message has a positive tone (dovish), it means that interest rates and monetary policy are loosening. However, if the message is negative (hawkish), it means that the central bank is trying to tighten the economy. And this means more expensive debt, less liquidity and higher interest rates, which ultimately means a decrease in the money supply in the economy. Powell will speak twice on Friday, both of which will have traders perking up as the markets try to decipher Powell’s voice. Yes, this man has that much power. Imagine what it would be like to be in his place? The Christmas miracle may appear in the form of a triangle From a technical point of view, the crypto market is ready for further improvement regardless of Powell’s voice. Ascending triangle on the chart of the bitcoin exchange rate The last month has brought extraordinary profits for traders after a long time. Thus, the market was able to form an ascending triangle shape. Technical analysts see this as a bull market continuation pattern in an uptrend. The combined value of all cryptocurrencies could rise well above $1.5 trillion if the price breaks through the upper trend line of the triangle in December 2023. Conversely, a break below the lower trend line of the triangle may bring the risk of invalidating the continuation of the bull market trend.
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