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Bitcoin in for more despair than delight

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Even with Bitcoin trading in a tight range for the past two months, expectations of a Bitcoin push over $10,000 are bleak in comparison to the drop from this point forward. Going by the pricing of futures and options contracts from now till the end of 2020, the cryptocurrency is not seen in the best of light. 

According to a recent report from Ecoinometrics, the next phase of Bitcoin’s 2020 outlook is two-fold. Firstly, the optimistic expectation is the accumulation of positions between the $8,700 to $9,000 range, as traders foresee more “sideways price action.” Secondly, and on the pessimistic side, Bitcoin “breaks out to the downside.” 

Going by these two pathways, the first would require open positions to increase, which would have to be differentiated between an “accumulation phase” i.e. positions in the aforementioned $8,700 – $9,000 range, and a “real capitulation” phase i.e. traders closing positions expecting a drop. In the past two months, since the tight-range trading began, the open interest on CME Bitcoin Futures has dropped from its ATH of $532 million to the current value of $378 million.  

CME Bitcoin Futures open interest | Source: skew

The second outlook is “the sentiment straight to despair,” with Bitcoin dropping to the lows of close to $6,000 to $7,000, or even closer to the March 2020 level. If this more pessimistic future were to be realized, the report gave the following piece of advice, 

“Regardless I’d see that as an opportunity to buy the dip. Trust me, you never have enough cheap sats in your wallets.”

Now that the paths are laid out, the sentiment of the traders in the market bears introspection. The report, citing the latest CME Commitment of Traders [COT] report suggested it pointed to “a path to despair.” 

As laid out earlier, the OI on CME Bitcoin Futures has dropped by 28.94 percent, which looks worse compared to how the two most ardent class of investors are looking at Bitcoin. The “smart money” or the institutional investors are “very much net short” while the retail traders despite being long Bitcoin are slowly changing their tune, 50 percent of retail long positions have dropped from 2500 max net long, to 1250 at press time. The report stated,

“Less open positions together with the long positions fading away at a high rate is the path to despair.”

While this does mean the bullish sentiment is all but dead, looking at the CME Bitcoin Options data, the “story it tells isn’t bearish.” While the Bitcoin call options, or contracts to buy Bitcoin have been decreasing over the past month, there is no rush to buy put options, or contracts to sell Bitcoin.

According to the report, this means that traders don’t expect a lot of money to be made if Bitcoin drops. And on the upside, there is a decent cover i.e. 13 call options to every put. With very little concrete expectation of which way Bitcoin will move, traders aren’t jumping to bet on Bitcoin, or for that matter, better against it. In fact, traders are still maintaining their mild bullish expectations of Bitcoin rather than replacing it with bearish expectations. But some are still going short, as is evident from the falling OI. 

Well, what does this mean for the market? It means that Bitcoin’s stability is not a bearish sign, but it is decreasing the bullish expectations that it accumulated during the April-May recovery period. And until a market-move does happen, traders won’t compile positions. The report concluded,

” So they are just sitting there waiting for something to happen. And isn’t it what we are all doing  at the moment?”

Source: https://eng.ambcrypto.com/bitcoin-in-for-more-despair-than-delight

Blockchain

A senior BOJ official says the digital yen needs public support for it to become a reality.

According to the Bloomberg report, a senior Bank of Japan’s official said that there is no final decision has been made yet even after the announcement of testing to start next year. The official revealed that a lot depends on the public support for it to go ahead with its central bank-backed digital currency. Kazushige […]

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A senior BOJ official says the digital yen needs public support for it to become a reality. – Coinnounce




























The central bank of Japan’s move to launch a digital currency would be conditional on public support, according to a senior BOJ official.


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Source: https://coinnounce.com/bank-of-japan-official-says-cbdc-needs-public-support/

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Japanese soccer star Keisuke Honda launches his own crypto

Crypto and blockchain matter for the global soccer community.

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A Japanese professional soccer player is launching his own cryptocurrency to boost fan engagement.

Keisuke Honda, former Japan midfielder and currently a captain of the Brazilian professional league team Botafogo, has launched his own token to build new connections with his fans, Cointelegraph Japan reported on Oct. 22.

The so-called “KSK Honda Coin” was launched on Thursday via Rally.io, a blockchain platform for creating video streaming and gaming applications. The new coin is intended to enable fans to interact with Honda.

Holders of KSK Honda token will be able to get exclusive content from Honda as well as interact with the player via private channels on Discord. “We decided to create a social token to build new connections with our most loyal fans,” Honda said.

The world-known soccer player said that the new token will allow him to connect with fans in a more open manner, providing a 100% transparency in knowing who holds coins in the fan community.

The global soccer community is moving deeper into the crypto and blockchain industry in search of new ways of connecting stars with their fans.

On Oct. 15, a top soccer club in Russia’s Premier League — Zenit St. Petersburg — signed on to the blockchain-based gaming platform Sorare to issue collectible and tradeable digital cards. In September 2020, Italian professional sports club SS Lazio signed a multiyear deal with crypto trading platform StormGain, enabling new fan engagement options through crypto.

Source: https://cointelegraph.com/news/japanese-soccer-star-keisuke-honda-launches-his-own-crypto

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Grayscale invests $300m in a day to grow its crypto portfolio

Grayscale Investments continues to grow its cryptocurrency portfolio by adding $300 million in assets…

The post Grayscale invests $300m in a day to grow its crypto portfolio appeared first on Coin Journal.

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Grayscale Investments continues to grow its cryptocurrency portfolio by adding $300 million in assets under management (AUM) in a day

Grayscale Investments revealed that it had added $300 million worth of cryptocurrencies to its digital assets portfolio over the past 24 hours and over $1 billion in the last week. This information was relayed by Grayscale CEO Barry Silbert via a tweet yesterday.

The crypto fund manager noted that it had $6.3 billion in AUM as of October 15. However, it has added $1 billion in cryptocurrencies over the past week, and the company now controls $7.3 billion worth of digital assets.

Silbert stated that the company “Added a cool $300 million in assets under management in one day. The additional sum brings the total assets held under management to $7.3 billion”.

The funds are held in the company’s trust for Bitcoin (BTC) and Ethereum (ETH), in addition to Grayscale’s digital large-cap fund. This latest development comes less than 48 hours after PayPal announced its entry into the cryptocurrency market, with Bitcoin surpassing the $13,000 mark afterwards.

Each Grayscale report is delayed by 24 hours, which means that this data refers to the previous day’s figure.

The cryptocurrency funds manager reported that its Litecoin (LTC) Trust recorded the highest growth since the last report. Grayscale reported that its LTC Trust increased by 7.5%, while their Zcash (ZEC) Trust increased by more than 6% over the past 24 hours. Grayscale also has extensive holdings in other cryptocurrencies such as Ripple (XRP), Ethereum Classic (ETC), Bitcoin Cash (BCH), Horizen (ZEN) and Stellar Lumens (XLM).

Grayscale might be increasing its cryptocurrency holdings after raising massive funds in the third quarter of the year. Grayscale’s financial report for Q3 2020 revealed that it had bought over $1 billion in investment across all its cryptocurrency trusts. This year, Grayscale has raised $2.4 billion, which is more than twice the total amount they obtained for the years 2013 – 2019.

The investment firm revealed that 81% of investment in the third quarter came from institutional investors, while another 57% came from people investing in multiple products.

With the crypto fund manager now holding over $6 billion in AUM, it means that Grayscale controls around 2.5% of the total Bitcoin supply, currently above 18,000 BTC. The Bitcoin supply is capped at 21 million, which means that roughly 2.5 million bitcoins are left to be mined.

Grayscale isn’t the only company that is increasing its stakes in cryptocurrencies at the moment. MicroStrategy recently bought $425 million worth of Bitcoin, and Jack Dorsey’s Square Inc. invested $50 million in Bitcoin.

Source: https://coinjournal.net/news/grayscale-invests-300m-in-a-day-to-grow-its-crypto-portfolio/

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