Bitcoin should take a break before the next rally

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Bitcoin buyers are in profit-taking mode as the cryptocurrency tests the resistance level of $ 40,000. Sentiment has improved dramatically over the past week, although some analysts believe it is time to take a break before another higher step.

“BTC easily broke above $ 35,000, but I think it will probably have a harder time breaking above $ 40,000 this time around,” Justin Chuh, senior trader at Wave Financial, wrote in an email to CoinDesk.

“The miners and sellers are coming back to cash in once more and the buyers are unable to push it any higher after absorbing this blow,” Chuh wrote.

Latest prices

Related: Overbought Bitcoin at $ 40,000 Resistance; Support at $ 34K-$ 36K

Crypto-currencies:

Traditional markets:

S&P 500: 4403.9, + 0.056%

Gold: $ 1,808.1, + 0.5%

The 10-year Treasury yield closed at 1.233%, versus 1.238%

Watch moving average

Sentiment can easily switch from bullish to bearish as bitcoin remains in a consolidation phase with strong air resistance.

“BTC has already been rejected again by its 200-day moving average just like at the start of June, but it should try again after a hiatus and hopefully not drop below $ 35,000,” he said. writes Chuh.

Related: Think Tank Rand Says Crypto Should Be Included In US-Japan Digital Trade Deal

“If (and when) bitcoin crosses the 200 days, it will signal confidence in the market and demonstrate to many players that the bulls have regained control of the market,” Alexandra Clark, trader at a UK-based digital asset broker -United. GlobalBlock, wrote in an email to CoinDesk.

For now, trading activity is up sharply compared to June. Short-term call options were actively traded on Wednesday morning as bitcoin approached $ 40,000, according to data from Skew.

GBTC discount is shrinking

Grayscale Bitcoin Trust (GBTC) shares have lowered their discount to the underlying cryptocurrency held in the fund – perhaps a sign that buyers are using the vehicle to bet on the recent rally in asset markets. digital.

The story continues

GBTC shares traded at a 6.6% discount to net asset value (NAV) on Tuesday, the smallest margin since June 22, based on data provided by crypto derivatives research firm Skew . The haircut had widened to 15% in mid-June.

Some investors may have bought GBTC shares in hopes that the discount will evaporate with a bullish rally in bitcoin. In this scenario, buyers would reap all the price gains on bitcoin while also pocketing additional profits through a narrowing of the discount. (Grayscale Investments, which manages the trust, is a unit of Digital Currency Group, which also owns CoinDesk.)

Ether exchange volumes increase

The ether market grew three times faster than the bitcoin market in the first six months of the year as large investors diversified into the native Ethereum blockchain token, according to the biannual review. of the Coinbase crypto exchange released on Monday.

Crypto CEOs are bullish

Crypto investors have just gone through one of the most difficult quarters on record. Despite a recent rebound, fears of over-regulation, a crackdown on mining in China and environmental concerns have all contributed to negative sentiment in the industry. Most of CoinDesk 20’s assets, which make up around 99% of the crypto market by verifiable volume, ended the second quarter with negative returns.

The Bitcoin CoinDesk (XBX) price index fell 40%, its third worst quarter in history. Conversely, the CoinDesk Ether Price Index (ETX) ended the quarter up 18.7%. While bitcoin has recovered some of its losses, the level of optimism is far from where it was at the start of the second quarter.

Some crypto CEOs, however, still expect a six-digit bitcoin price, saying the medium-term outlook for the crypto market is positive, even if sentiment is not, reports Will Canny of CoinDesk.

Why stablecoins are in the spotlight

Stablecoins have been around for about seven years, but discussions about them have never been more heated than in recent weeks, not only within the crypto community, but also among regulators and traditional market investors.

A lot has happened in the world of stable coins lately, and some of it can be overwhelming. Here are the three big things happening right now:

Tether is under a cloud: As the most traded cryptocurrency on the market, USDT has become the backbone of the entire cryptocurrency ecosystem. More than half of all bitcoin exchanges are made against it. However, Tether, the company behind the digital token, has been plagued by regulatory issues.

Regulatory Heat: Stablecoins had a total market cap of $ 116 billion on Monday, an almost four-fold increase since the start of this year, according to CoinMarketCap. As growth has increased, so has the attention of the United States and other regulators.

Circle going public, other stablecoin issuers leak more: Circle, the issuer of USDC, the second-largest stablecoin, was also in the spotlight. Circle is considering going public through a merger with Concord Acquisition Corp., a publicly traded Special Purpose Acquisition Company (SPAC). The deal would value the crypto financial services company at $ 4.5 billion. Another stablecoins issuer, Paxos, also first released a reserve breakdown for its stablecoins, the Paxos standard and the Binance-labeled BUSD. About 96% of reserves were held in cash and cash equivalents, while 4% were invested in US Treasuries as of June 30.

Altcoin balance sheet

XRP rallies: XRP, a cryptocurrency used by Ripple in its payments network, peaked in five weeks on Wednesday after the company said it was targeting the $ 1.8 billion Philippine remittance market . The cryptocurrency changed hands at $ 0.74 during European hours, reaching its highest level since June 21 and representing a 13% gain on the day, according to data from CoinDesk 20.

Ether Trade Volume Increase: Ether trade volume totaled $ 1.4 trillion in the January-June period, an increase of 1461% from the $ 92 billion observed in the first half of last year.

Burger King Brazil accepts dogecoin: Burger King Brazil is now accepting dogecoin (DOGE, + 2.64%) as a payment method to purchase the fast food chain’s Dogpper, a dog snack. The service has been available since Monday, according to the company’s official website, although users should check the availability of delivery in their region, the company said. Each Dogpper – a dog treat that plays on the name of Burger King’s most famous menu item, the Whopper – costs 3 DOGE. The company recommends purchasing a maximum of five units per order for “availability reasons.”

Relevant news: other markets

Most digital assets on CoinDesk 20 increased on Wednesday.

Notable 9:00 p.m. UTC (4:00 p.m. ET) winners:

xrp (XRP) + 12.51%

them (EOS) + 6.43%

uniswap (UNI) + 4.77%

Notable losers

the graph (GRT) -0.31%

Finance year (YFI) -0.23%

USD coin (USDC) -0.06%

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