Weekly Crypto Market Report: February 14-20, 2022 - BTC, ETH, XRP, GRT & More
Market Fundamentals Analysis
BTC (-6.50%) and ETH (-5.25%) led the decline over the weekend following reports that President Biden is likely to issue an executive order next week directing government agencies to study cryptocurrencies and a central bank digital currency. In addition to that, the unfavourable macroeconomic situation in Russia, has further dampened the sentiment, leading to a rather significant correction setting in over the past week.
The Bitcoin network has hit another all-time high in terms of difficulty as competition among miners intensifies over the past few months. On-chain analysis indicates that on Friday mining difficulty reached a new high of 27.97 trillion hashes. Amongst alts, Decentraland welcomed JPMorgan, as it became the first large Wall Street bank to open a presence in the metaverse, with their announcement of a lounge opening in Decentraland.
Over the past week or so, an interesting pattern has started to emerge. It appears that retail investors are taking this opportunity and buying the dips more and more, while hedge funds and VCs are less convinced that this dip will end anytime soon as they continue selling. Due to this dynamic, the market is unable to swing in a particular direction, and has been rather range bound over the weekend.
The ongoing legal battle between Ripple and the U.S. SEC carries on. Going into its second year, some newly released documents might provide the payment company with an advantage over the commission, according to industry experts. This development has led to a strong rally in the asset. XRP is up 30% since the start of the month, and has consistently seen attractive volume growth. The anticipation is high, and after the court filings submitted on Feb 18, many believe that Ripple has a high chance of proving that XRP is not a security asset, something it was sued for in Dec 2020, marking an end to this saga. A break and close above C$1.10 level could challenge the resistance at C$1.35. The gradually rising 20-day EMA and the RSI near the midpoint suggest a minor advantage to buyers right now.
The Graph (GRT) got a double-digit boost in price after its catalogue of subgraphs increased and Web3 became a trending topic among industry experts. After hitting a low of C$0.43 on Jan. 24, GRT has rallied to its resistance level at C$0.65. The key reasons for its momentum include GRT’s addition of new subgraphs, increased capabilities of The Graph network due to community engagement and outreach efforts, and finally the rise of Web3.
We’re in a cycle right now where events completely separate from crypto (imminent rate hikes, Russia-Ukraine) threaten to completely disrupt the frankly strong narrative which crypto has established here in 2022. However, even then we are seeing strong fundamental developments take place. An example of one is Twitter adding Ethereum wallet support - this was not a surprise to the market but is still a relatively big deal for ETH. Every Layer 1 has its own case for an NFT ecosystem, and Ethereum’s position in the PFP space seems like a secure lead, which will only grow with Twitter integration. It also does highlight a key advantage that Ethereum has at this moment, which is wallet infrastructure readier to interact with Big Tech. This will surely change over time, but this feels like a space where the first-mover advantage is no small factor.
- American venture capital firm Sequoia Capital has launched a new cryptocurrency fund as part of its ongoing efforts to bootstrap the next generation of blockchain-focused startups.
- Major financial services firm Fidelity International will be listing a Bitcoin exchange-traded product on the SIX Swiss Exchange and Germany’s Xetra digital stock exchange.
- The Bulgarian Stock Exchange has recently launched eight ETNs based on two digital currencies, Bitcoin and Ethereum.
- Opensea co-founder and CEO, Devin Finzer, has denied rumours that the non-fungible token (NFT) marketplace’s codebase was breached and that attackers had stolen $200 million.
Bitcoin Technical Analysis
Bitcoin, after making the low of C$41,600 (on 24th Jan) started moving in an uptrend and rallied up to C$58,073. The asset faced a stiff resistance at C$58,250 (Horizontal trendline) and corrected almost by 16%. BTC broke the key support of C$51,000 and made a low of C$48,500.
The asset has a strong support at C$46,000 whereas C$51,000 will now act as a strong resistance. If the bulls fail to defend the support then we can expect further downfall and the prices can test the C$43k levels. To witness a rally BTC needs to sustain and close above C$51,000. RSI in the negative territory indicates that the bears have the upper hand.
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Information provided in the weekly market report is for information purposes only and should not be interpreted as investment, legal, or tax advice. Prior to investing, it is very important to evaluate your investment objectives and your risk tolerance carefully. This technical report is not meant to provide guarantees of future performance, and users should not rely on it, as the actual performance and financial results may differ significantly.