The Crypto Pulse August 23rd
Rollbit's weekly analysis and review of the news in Bitcoin, Ethereum and cryptocurrency markets.
Rollbit's weekly analysis and review of the news in Bitcoin, Ethereum and cryptocurrency markets.
News 📰
Coinbase will Buy $500M in Crypto and Invest 10% of all Future Profits in Digital Assets
On Thursday, Coinbase CEO Brian Armstrong revealed that the exchange will purchase $500 million worth of cryptocurrency and add it to their balance sheet. The largest American exchange will also invest 10% of its profit into cryptocurrencies.
We recently received board approval to purchase over $500M of crypto on our balance sheet to add to our existing holdings. And we'll be investing 10% of all profit going forward in crypto. I expect this percentage to keep growing over time as the cryptoeconomy matures.
— Brian Armstrong (@brian_armstrong) August 19, 2021
A blog post published by Coinbase on Friday also noted that the exchange will become the first publicly-traded company to hold Ethereum's ETH, DeFi tokens and Proof-of-Stake assets on its balance sheet.
The post also noted that Coinbase may increase their allocation over time as the cryptocurrency economy matures, stating "We believe that in the future, more and more companies will hold crypto assets on their balance sheet".
Sudden Rise of Solana Takes Crypto Markets by Surprise
Solana's native cryptocurrency SOL entered the top 10 coins by market capitalisation last week after the price reached an all-time high just above $80, with the price increasing by more than +35.1% over the past 7 days.
There are a couple of catalysts that saw the price of SOL shoot to fresh highs. Firstly, the NFT art platform Solanart launched the Degenerate Ape Academy collection, with 10,000 Apes selling out in just 8 minutes.
Secondly, the total value locked in DeFi applications built on Solana breached $2 billion for the first time on August 17th and reached an all-time high above $2.5 billion on August 22nd, according to data from DeFi Llama.
Dogecoin Foundation Returns With Ethereum’s Buterin as Adviser
On Tuesday, the Dogecoin Foundation re-emerged with Ethereum co-founder Vitalik Buterin and Elon Musk representative Jared Birchall serving as board members. The Dogecoin foundation was originally launched in 2014, but became inactive and it was eventually dissolved.
The Foundation hopes to secure a three-year budget to fund staff to work on Dogecoin (DOGE) full time and stated that they “will be announcing new projects that will complement the current Core Wallet to enable faster integration and easier APIs (application programming interfaces) for financial, social and charitable projects wishing to use dogecoin.”
TikTok Mixes It Up With Ethereum, Taps Audius as First Music Streaming Partner
Audius, a decentralised, open-source streaming platform built on the blockchain entirely controlled by artists, fans and developers, has partnered with social video app TikTok.
The blockchain-based streaming platform has become one of TikTok's first partners for its Sound Kit functionality, which allows songs to be seamlessly transferred into the social app. TikTok users can now include the songs that artists post to Audius in their videos.
The price of the platform's native token, AUDIO, jumped to highs near $4 on the back of the announcement and has gained more than +123% over the past 7 days.
OpenSea NFT Marketplace Reaches $1B in Trading Volume in August
The NFT trend doesn't seem to be slowing down with NFT marketplace OpenSea surpassing $1 billion in trading volume for the first time in August. The CEO of the NFT marketplace Devin Finzer said on Twitter:
OpenSea just hit $1B in trading volume for the month of August so far.
— Devin Finzer (dfinzer.eth) (@dfinzer) August 17, 2021
And it's still day 0 for NFTs.
According to DappRadar, OpenSea has witnessed triple-digit percentage growth in the number of users and transactions over the past 30 days.
Source: DappRadar
Other News
- Bitcoin's Lightning Network surpassed 25,000 active nodes for the first time according to data from 1ML.
- Payments giant Visa buys CryptoPunk #7610 for $150,000.
- Alibaba has launched a new marketplace allowing trademark holders to sell NFTs representing licenses to their copyright.
- DeFi Projects Could Come Under SEC’s Oversight, Says Chairman Gensler.
Market Analysis 📈📉
7-day Price Change
Data as of August 23rd, 17:30 UTC
Let's look at the Bitcoin chart.
Following the price of Bitcoin closing above the 200-day moving average on August 19th, a new uptrend is underway on the daily chart. Since the price failed to stay below the 200-day moving average for too long and has broken above the August 14th high near $48,200, it looks as if Bitcoin will now head towards May's high around $59,000 over the long-term. A daily close above the psychological level at $50,000 will strengthen the bullish outlook even further.
Bitcoin posted its fifth consecutive week of gains, the longest winning streak on the weekly timeframe since October 2020. The large bearish candle from the second week of May is a bearish variant of the Marubozu candlestick pattern, suggesting resistance will be found at the mid-point ($52,374.99) and at the opening price ($58,336.16), so these two levels will be ones to watch from now on (shown by the white dotted lines on the chart below).
The 1-day chart for Ethereum below shows that volatile price action is incoming, with the Bollinger Bands squeezing together. The width of the Bollinger Bands (which gives an indication of the market's volatility) has fallen to the lowest level since March 2021 for ETH-USD suggesting a big move is incoming as volatility returns.
With the price of Ethereum breaking above August 16th's high today, it looks as if the direction of the breakout will be to the upside. The main resistances in the way of Ethereum's all-time high price of $4,380 lie near $3,500, $3,880, $4,000 and $4,200.
While Bitcoin and Ethereum are slowly creeping back to their all-time highs, Solana's SOL token outperformed the wider cryptocurrency market, reaching a fresh high near $80 last week.
The 4-hour chart for SOL with the Bollinger Bands shows that the price may trade sideways between $80 and $70 before deciding on the next direction. The price of SOL is currently just above the lower band at $70.39 and suggests a buying opportunity at a price below $70.
The price of SOL has so far respected the Fibonacci retracement level at $71.10, which has held as support. As the chart below shows, if the price manages to break above the all-time high near $80, then we could see a rapid rise to $107.85, which is the first Fibonacci extension level. If the support level at $71.10 does not hold, then the next support is found at the $63.68, the nearest Fibonacci retracement level.
Have a great week!
-The Rollbit Team