Market wrap: Bitcoin jumps to $ 36.8,000, other cryptos higher despite worrying signals from China

The prices of blockchain-based assets are rising amid a new wave of uncertainty regarding the regulation and enforcement of cryptocurrency in China,

  • Bitcoin (BTC) was trading at $ 36,278 at 9:00 p.m. UTC (4:00 p.m. ET), jumping 10.2% in the previous 24 hours.
  • 24-hour range of Bitcoin: $ 32,557 to $ 36,890 (CoinDesk 20)
  • Ether (ETH) is trading at $ 2,561 at 9:00 p.m. UTC (4:00 p.m. ET). In the green 2.3% over the last 24 hours.
  • 24 Hour Ether Range: $ 2,418 to $ 2,613 (CoinDesk 20)

Bitcoin price explodes

Bitcoin hourly price chart on Bitstamp since June 6.
Source: TradingView

Bitcoin, the world’s largest cryptocurrency by market cap, was 10.2% green on Wednesday at the time of publication. The price was above the 10-hour moving average and the 50-hour moving average, a bullish signal for market technicians.

The price of bitcoin rose from $ 32,557 at 2:00 a.m. UTC (10:00 p.m. ET Tuesday) to $ 36,890 at 5:20 p.m. UTC (1:20 p.m. ET) Wednesday, a gain of 13.3% on the basis of CoinDesk 20 data. Bitcoin then lost some momentum, falling to $ 36,278 at time of publication.

Bitcoin traders appear to be ignoring the potentially dismal news for crypto in China. This includes an order to shut down miners in Qinghai Province, a ban on certain blockchain keywords across the country, and the arrest of more than 1,000 people for potential crypto money laundering.

In fact, data on the channel suggests that there is much less bitcoin dry powder on the exchanges in recent weeks, as some crypto investors are clearly buying and recovering BTC in over-the-counter wallets.

“A signal in favor of continuing the current bullish reversal is the amount of BTC leaving exchanges from a chain perspective,” said Sean Rooney, head of research for digital asset manager Valkyrie Investments. . Foreign exchange outflows throughout this recovery were the highest on record in 2021, he said.

Bitcoin reserves are falling

Bitcoin reserves on exchanges (red) versus price (black).
Source: CryptoQuant

According to data aggregator CryptoQuant, stock holdings on major sites fell to $ 2.46 million, the lowest since May 17.

Rooney believes the pattern will have to persist for bitcoin to return above $ 40,000.

“This trend will need to continue to break through strong resistance around $ 42,000,” Rooney added. “This rebound in oversold conditions was potentially aided by a much needed positive sentiment with growing adoption hopes in El Salvador.”

Read more: It’s official: El Salvador’s legislature votes to adopt Bitcoin as legal tender

Dull bitcoin futures market

Bitcoin futures opened up interest on major sites last month.
Source: Distort

Since May 19, when the open term interest (OI) in the BTC market was $ 12.1 billion, a bearish-to-side condition has developed in derivatives.

At the time of going to press, the bitcoin futures OI stood at $ 11.1 billion, down 8% and a reversal from the steadily rising futures OI seen earlier this year. The figure reached an all-time high of $ 27.4 billion in OI on April 13, according to data aggregator Skew.

Bitcoin futures have opened up interest on major sites last year.
Source: Distort

The smart money that usually places positions in derivatives is no longer available, noted Elie Le Rest, partner of the quantitative fund ExoAlpha.

“Traders still have doubts about the direction of the market, so leverage has remained relatively low,” said Le Rest. “Bitcoin breaking $ 40,000 could give traders confidence a boost to leverage again to reach new highs in the crypto market.”

Ether charge at three-month low

Hourly Ether price chart on Bitstamp since June 6.
Source: TradingView

The second largest cryptocurrency by market cap, Ether, was trading at $ 2,561 at 9:00 p.m. UTC (4:00 p.m. ET), a gain of 2.3% over the previous 24 hours. The asset is above the 10-hour moving average and the 50-hour moving average, a bullish indicator for market technicians.

The price for using the Ethereum network, known as gas, has fallen to its lowest level in three months, to 16 gwei median or avg at the time of publication, according to data analytics portal Dune Analytics. The gwei is the smallest unit of account of the ether, representing an increment of one billionth.

Median gas prices over the past three months.
Source: Dune analysis

Peter Chan, senior trader at OneBit Quant, attributed the high gas fees to a war between competing automated trading systems for arbitrage opportunities in Ethereum’s decentralized finance ecosystem, or DeFi. For example, on May 11, the median gas price was 311 gwei, nearly 20 times the level seen on Wednesday.

“There are no more gas wars between arbitrage robots now,” Chan said. “So even when the market is volatile, arb robots will not drive up the price of gas.”

Read more: Solana Labs Raises $ 314 Million in Token Sale Led by A16z, Polychain

Other markets

In the alternative cryptocurrency market, The Rest of ExoAlpha monitors tokens associated with Ethereum’s competitors.

“Alternative chains are putting a lot of effort into taking DeFi market share,” Le Rest told CoinDesk. These could include Binance Smart Chain, Solana and Avalanche, he said.

Digital assets on CoinDesk 20 are all higher on Wednesday. Notable Winners at 9:00 p.m. UTC (4:00 p.m. ET):

  • Gold was down 0.13% to $ 1,889 an ounce at the time of publication.

Read more: BitMEX lawsuit plaintiffs claim to present new ‘Smoking Gun’ evidence

  • The yield on 10-year US Treasury bonds fell 3% on Wednesday to 1.489%.

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