Investors Should Pay Attention to the Possibility of a Further Drop in the Price of Bitcoin

Alexander Salazar
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Investors Should Pay Attention to the Possibility of a Further Drop in the Price of Bitcoin

The comparison between deeply oversold RSI and the long-term price action of BTC shows it is profitable to buy. Although some traders foresee an optimistic change, cryptocurrencies must face macro challenges like a bullish divergence.

Since there are few signs of an upcoming recovery, the bulls consider the daily price action of Bitcoin (BTC) far from satisfactory.

In line with the trend in the first half of 2022, some factors continue to influence the price of BTC. The possibility of strict regulation, interest rate hikes by the Fed, the Russia-Ukraine conflict, and a possible recession are among those circumstances.

Due to those problems, institutional investors have lost interest in high-volatility assets while the euphoria about the 2021 bullish market has faded significantly.

Although the daily price action of Bitcoin is discouraging, longer-duration metrics show interesting data about investor sentiment and valuation perception.

The Bitcoin Market Still Has to Face Oversold Conditions

The price of Bitcoin puts long-term downward pressure on the daily and weekly timeframe. Besides, the Bollinger Bands, which reflect two standard deviations above and below a simple moving average (SMA), are becoming tighter.

The relative strength index (RSI) reached a multi-year low due to the sell-off of Bitcoin from March 28th to June 13th. In addition, comparing the indicator against the long-term price action of BTC shows it is profitable to buy with a deeply oversold RSI.

Despite the pessimistic short-term situation, a skeptical view of the price and the market suggest a favorable time to hoard.

According to analysts, the price may drop until reaching between USD 15,000 and USD 10,000. In addition, the buy wall at USD 18,000 may disappear and become a bullish trap.

The moving average convergence divergence (MACD) oscillator is another metric to watch in the long term. It became deeply oversold when the price of Bitcoin dropped to USD 17,600 but remains in untested territory.

Although some traders think there might be an optimistic change, cryptocurrencies still face macro challenges. While the price of Bitcoin shows weekly highs and lows, the RSI and MACD move in the opposite direction, a bullish divergence.

Since the convergence of various indicators suggests an undervalued Bitcoin, the bottom does not seem imminent. If BTC dropped to USD 10,000, it would lose 48% of its value, close to USD 20,000.

The MVRV Z-Score Highlights the Oscillation between Fear and Greed

David Puell, the creator of the MVRV Z-Score, says this metric highlights the oscillation between fear and greed in the price cycle. He believes that the brilliance of realized value is that it significantly dampens the emotions of the crowd.

If the market value of Bitcoin is considerably higher than its actual value, the metric enters the red area. When in the green zone, it indicates that BTC is below its realized price while the market may be about to bottom out.

Regarding the price of Bitcoin, the 0.127 MVRV Z-Score is in the same range as previous multi-year lows and cycle bottoms. On-chain data and the above technical analysis indicators suggest an undervalued BTC is in an ideal zone for a long position.

By Alexander Salazar

SHIB Whales May Use USD 3 Million, Influencing Retail Investors

Alexander Salazar
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SHIB Whales May Use USD 3 Million, Influencing Retail Investors

According to Etherscan, two transactions by an ETH whale amounted to USD 3.4 million, one by 200 billion SHIB and another by 100 billion SHIB. Although this hoarding aims to encourage retail investors, the thirty-day MVRV ratio indicates it is not yet time for consistent greens.

The recent impact of significant transactions may have caused the trading volume of Shiba Inu (SHIB) to increase by 49.14%.

One of the leading Ethereum (ETH) whales conducted two large operations, according to the analytics platform Etherscan.

The blockchain explorer also revealed that the two transactions amounted to USD 3.4 million. The whale first transferred 200 billion SHIB tokens to another wallet, after which another 100 billion SHIB went into it.

The Current Situation of the Price of Shiba Inu

Despite a considerable trading volume, there was no evident impact on the price of the popular meme coin. According to CoinMarketCap, SHIB is trading at around USD 0.00001125, representing a 2.33% rally against ETH and 1.23% against Tether (USDT).

Even though the transactions may be insufficient to drive SHIB to a double-digit rally, they proved effective in other areas. Regarding several tokens, SHIB shifted out of the daily hoarding ranges of the Ethereum whales.

Investors can now revel in the return of the meme coin Shiba Inu. According to WhaleStats, SHIB occupies sixth place, with over USD 1.37 million accumulated over the last 24 hours. The Ethereum whales held around USD 137.45 million worth of SHIB tokens.

On-Chain Analysis of the Price of Shiba Inu

Although this hoarding aims to encourage retail investors, other metrics also play a relevant role. The thirty-day market value to realized value (MVRV) ratio indicates it is not yet time for consistent greens. According to market intelligence platform Santiment, the MVRV of Shiba Inu was -3.30%.

In that context, the chance for SHIB to hit its current value twice was unlikely. The dominance of the crypto asset is 0.66%, implying that it does not receive much interaction among retail investors.

That situation could be due to the market decline, but SHIB might not take advantage of the whale effect for a rally. Besides, the social volume of SHIB showed an increase in the search for tokens while there was still interest in it.

The improved social volume of Shiba Inu did not guarantee that the short-term momentum would improve. The inflow of the meme coin on cryptocurrency exchanges was extremely low after a rise on September 12th.

Meanwhile, SHIB is trading at around USD 0.00001117 and has accumulated a 1.7% loss over the last 24 hours. While its daily trading volume is above USD 138.38 million, its market capitalization is USD 6.58 billion, according to CoinGecko.

Investors should research cryptocurrencies like Shiba Inu before buying them to know their all-time high, behavior, and possible future price. That will allow them to find the most convenient investment opportunity to minimize the risk of losing their money.

By Alexander Salazar

Predictions for the Crypto Market in October: What will happen?

Audy Castañeda
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Predictions for the Crypto Market in October: What will happen?

October is presented as a “hot” month for the cryptocurrency market. Know everything that can happen in the new month.

September brought about lateral movements in the crypto market. Therefore, investors are expectant regarding the next movements in cryptocurrencies in this new month: Will they hit new yearly lows, or will we see significant increases?

Bitcoin has a lot to tell us about this question, since in recent weeks its price has moved in the range of $18,500 and $22,500. The $18,500 serves as a good support, which apparently only in a really pessimistic scenario could be broken. However, this month will be decisive for that support, as the reasons will be disclosed below.

For its part, in ETH, after the week starring The Merge and the subsequent fall, its price moved laterally in the range of $1,300. Said $1,300 has been a good support, and when the price tried to break it, this led to a bounce.

Some analysts have highlighted the fact that BTC whales that count between 100 and 10,000 BTC continue to dump. The evidence of this is that during the past month these addresses have reduced their supply by 0.4%, which, furthermore, goes against the thesis that we are facing a phase of accumulation of the whales.

On the other hand, the crypto market capitalization stands at $934 billion, being the $900k million a good support for said capitalization.

Inflation will dictate the next big crypto market move

Inflation has played an important role in the prices of the crypto market, since based on it, the FED has defined its interest policy. Therefore, the development of inflation in this month of October plays a key role for the next interest rate update in November.

It is worth noting that the PCE of the United States, which is the index preferred by the Federal Reserve, exceeded the forecast of 4.7% year-on-year, reaching up to 4.9%. The development of this measure during October is key to determining the next interest rates.

Several economists are not optimistic about the development of inflation this month and therefore predict that the next rise in interest rates will be 75 points again. The vice president of the FED in New York stressed that “policy will have to be restrictive (…) We are committed not to back down prematurely.”

The upcoming interest rates are a real test for the crypto market and if they are drastic, we will have the opportunity to check if the prices have really bottomed out or can still exceed the yearly lows.

Regulations will be a hot topic in October

Currently, the crypto market is heading towards a series of important regulations that could make room for the influx of institutional investments. The legal loopholes in the regulation of cryptocurrencies generate uncertainty in institutional investors. Therefore, regulations can lead to an influx of investors.

Speaking of government measures, September was a bullish one for XRP, which rose as much as 50% as its victory against the SEC became evident. Beyond the results of the legal disputes, a clear regulation will be a good motivator for the access of new investors to the crypto market, as we have said.

However, it is worth keeping in mind that the legal landscape could really improve well into 2023, when such regulations move forward through the government bureaucracy. In the following months before 2023, some frameworks and discussions will surely be seen.

By Audy Castaneda

The Solana Network Goes Back into Operation after Suffering a Serious Disruption

Alexander Salazar
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The Solana Network Goes Back into Operation after Suffering a Serious Disruption

The validators deviating from the main code path got stuck on the wrong fork, leading to a power outage. That outage is not an isolated incident, as Solana has experienced at least seven since its launch.

The Solana network recently suffered its second most serious disruption since January, frustrating many users. It took its developers a few hours to solve the partial power outages causing the price of SOL to drop by 6%.

The Validators of Solana Reset the Mainnet

The Solana group first brought attention to the outage on the Solana Status Twitter page. They stated that the network was experiencing a power outage and not processing any transactions.

After noticing their progress while solving the problem, Solana provided updated information and shared detailed instructions for restarting the cluster. After joining, four-fifths of the validators of the Solana mainnet network could finally bring it back into operation.

Why the Network Stops Processing Transactions

Validation operator Stakewiz.com explained on Twitter that a single validator had spread an invalid block. According to the post, that was not a big problem as it was something the network had to handle.

However, the validator produced a block from each of two duplicate instances, creating a fork on the network. Therefore, other validators could not determine which block was valid when they found one of them.

Stakewiz said an unrecoverable network partition had occurred due to the misconfigured node. Those validators deviating from the main code path could not return as they got stuck on the wrong fork. That may have led to the power outage when the network stopped processing transactions.

The developers said the misconfiguration might have been a failed node failover setup. When they understood the source of the problem, they decided to restart the cluster. The validator started the mitigation process after identifying that 153139220 was the last confirmed slot.

The Outage Curse of the Solana Network

The above outage is far from being a mere isolated incident since Solana has experienced at least seven (7) power outages. In 2020, the year of its launch, there were a maximum of five (5) disruptions. That happened about a year after the Ethereum killer had suffered electrical failures for almost 18 hours in September 2021.

Anatoly Yakovenko, the founder of Solana, recently described the outages as the curse of the network. Members of the community expressed their discontent with that situation, complaining about the frequency of the disruptions.

The founder of Cardano, Charles Hoskinson, made fun of the competing network after it disconnected. The entrepreneur reposted the announcement by Solana, while he shared a meme. Some users urged Hoskinson to stop mocking other blockchain platforms when they face occasional issues.

Meanwhile, SOL is trading at around USD 32.83 and has accumulated a 0.7% loss over the last 24 hours. While its daily trading volume is above USD 444.29 million, its market capitalization is about USD 11.66 billion, according to CoinGecko.

By Alexander Salazar

Ontario Securities Commission Sues James Hogg, Who Got $51 Million in an ICO

Audy Castañeda
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Ontario Securities Commission Sues James Hogg, Who Got $51 Million in an ICO

The US SEC also filed a lawsuit against Hogg for its promotion of DIG tokens.

The Ontario Securities Commission (OSC) has filed a lawsuit against Troy Richard James Hogg for selling unregistered securities in an ICO where he raised $51 million.

According to a press release, the OSC alleged that Hogg and his companies, Cryptobontix Inc, Arbitrade Exchange Inc., and Arbitrade Ltd. promoted and sold Dignity tokens (formerly known as Unity Ingot) between 2017 and 2019.

The regulator continued that Hogg promoted the tokens using false representations, including claiming that Gold Bullion endorses the tokens in promotional materials.

Hogg neither did file a prospectus for token distribution nor did he obtain the necessary registration for trading activities.

Additionally, it accuses Hogg and affiliated corporate entities of defrauding investors by using a substantial portion of the funds for unrelated purposes, such as the purchase of real estate. According to the statement of allegations, the OSC obtained assistance from the United States Securities and Exchange Commission in the case.

The SEC also files a lawsuit against Hogg

Meanwhile, the SEC has also filed a lawsuit against Hogg and other residents of the country for selling unregistered securities. He announced the charges filed today in the United States District Court for the Southern District of Florida.

According to the commission, the DIG token was pumped between May 2018 and January 2019 with “false and misleading” press releases and a press conference.

SEC Targets Players from 2007 ICO Boom

The case against Hogg is another instance of securities regulators pursuing cases against individuals and companies that promoted and sold tokens during the 2017 ICO boom.

Last month, the SEC filed a lawsuit against Ian Balina for promoting Sparkster SPRK tokens in 2018. Balina is a popular cryptocurrency promoter with his YouTube channel, Diary of Self-Made Man. He now runs a crypto investment research firm: Token Metrics.

The SEC accuses him of selling unregistered securities, and failing to disclose that he did indeed receive funds for the tokens he was promoting.

Balina will fight SEC accusations

Last September 19, Balina, in a written statement posted on his website, says the SEC’s claims are totally unfounded. According to the influencer, he only invested $100,000 in Sparkster and says there is “no evidence” that he received any kind of bonus from the firm.

“Mr. Balina also did not benefit from his purchase of Sparkster tokens. In any event, Mr. Balina is a potential victim of fraud and misrepresentation by the Sparkster team, like other investors,” the notice states.

On Twitter, Balina said he is “thrilled to make this fight public.” He said he will fight the charges in court to the end and has turned down a deal “so they have to prove themselves.”

Balina has said that he will fight all accusations on behalf of the crypto community. He claims that the regulator’s complaints against him “is a gross exaggeration in all respects.”

The crypto promoter is now asking the community to fund his defense against the regulator. He shared a Gofundme link, and also requested crypto donations on Ethereum.

“Due to the costly and exhaustive process ahead, an Ian Balina Legal Crimes Fund has been created to help with legal costs,” he tweeted.

By Audy Castaneda

Cardano (ADA) Nearly Dead, Ethereum Maximalist Says

Audy Castañeda
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Cardano (ADA) Nearly Dead, Ethereum Maximalist Says

According to popular Ethereum maximalist Evan Van Ness, Cardano is nothing more than a “zombiechain”.

Cardano recently celebrated its fifth birthday, and while the coin has come a long way from where it started, skeptics in the space are still unsure how far Cardano and ADA could go.

Cardano’s $14.9 billion market cap is impressive, especially considering its over 270% growth since January 2022. However, according to popular Ethereum maximalist Evan Van Ness, Cardano is not more than a “zombiechain”, gaining its traction from ADAbots. So what is the truth?

Is Cardano Becoming a “Zombiechain”?

When comparing transactions per second on Cardano vs Uniswap, Ness noted that the former has less than one transaction per second, which was substantially less than Uniswap.

Ness twitted that, “Not only does Cardano do less than one transaction per second…Uniswap does substantially more transactions than Cardano.”

The seven-day moving average of daily transaction counts for Uniswap (red) vs. Cardano (blue) shows that Cardano transactions began to decline after May 2021, while Uniswap transactions accelerated in July 2022, outperforming Cardano transactions.

This low transaction count is surprising when looking at Uniswap’s market cap of around $6 billion versus Cardano’s at $20 billion.

Notably, Uniswap also has a $1 million higher daily fee count compared to Cardano’s $10,000 or less in daily fees.

In contrast to Ness’s claims, some people argue that it is inaccurate to compare Uniswap and Cardano as they both use different models: account-based and eUTXO.

The eUTXO model is more robust compared to the account-based model which requires a state machine that will determine the state of an account at any given time.

However, the main downside of the eUTXO model is its inability to fit multiple transactions in one block, which is a crucial feature for decentralized applications and services.

Retailers Abound as ADA Whales Remain Cautious

Despite the successful launch of Vasil on mainnet on September 22, apart from high social volumes, ADA did not see any major increases in terms of price or user activity.

It should be remembered that the name given to the long-awaited hard fork is due to a tribute made to the important Cardano developer of Bulgarian origin, who died a few months ago: Vasil Dabov, who was a Cardano ambassador and Blockchain consultant.

With the Vasil hard fork, sweeping changes to the network were expected to take place, impacting transaction fees, speed, and decentralized application development.

However, a positive sight for ADA HODLers was the steady number of daily active addresses that have been maintained throughout the bearish period.

With the percentage of the total stablecoin supply held by whales being over $5 million at least, it was evident that ADA whales were noticing less trust, noting a continued decline.

ADA’s occasionally high trading volumes are a relief, but some support from HODLers and long-term whales is needed to price above the key $1 mark.

It is not known for sure whether ADA price will close above the red descending trend line, or rather add another leg lower to its bearish cycle.

The low for 2022, according to experts, is $0.385, and could be revisited if a rejection triggers a sell-off to the downside.

Seeing the current market turmoil this week and the next step in the escalation between Europe and Russia, there is no real incentive to start a strong bull run.

By Audy Castaneda

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