Real estate or Bitcoin: Which is more reliable?

September 22, 2023 Coin Telegraph

Analysis

Marcel Pechman explains whether real estate or Bitcoin is a better store of value and breaks down Instacart’s current valuation and why investors may want an alternate investment.

On this week’s episode of Macro Markets, Cointelegraph analyst Marcel Pechman discusses the real estate markets, highlighting stagnant mortgage demand, attributed to rising rates. With an average 30-year fixed-rate mortgage interest rate of 7.27%, refinancing and home purchase applications have dropped significantly.

Still, Pechman speculates that house prices might rise if inflation continues to grow. While some sellers may be distressed, real estate, especially urban residential, has historically been a reliable store of value. He concludes by highlighting that other investment options may not provide a safer haven in the current economic climate.

In the second segment, Pechman discusses Instacart’s initial public offering, which established its valuation at roughly $10 billion, significantly lower than its $39 billion peak valuation. This reflects the challenges faced by venture capitalists in the current economic climate. Pechman suggests a shift in investor metrics, emphasizing the need for a reliable store of value, where cryptocurrencies like Bitcoin (BTC) could play a role.

Pechman notes that not all cryptocurrencies seek growth through user bases and fees. Bitcoin can operate as a transparent reserve system for banks and nations, issuing Bitcoin-backed digital assets without requiring a billion users. This shift in perspective highlights the need for a reliable store of value. Unlike precious metals with auditing challenges, Bitcoin and cryptocurrencies can fill this role regardless of everyday user adoption.

For additional details and the complete analysis, check out the Cointelegraph YouTube channel.

Ethereum price sees new low versus Bitcoin since switching to Proof-of-Stake

September 21, 2023 Coin Telegraph

Analysis

Ethereum spot ETF request, Ripple’s potential win against the SEC, and growing decentralized app dominance retain hope for ETH investors.

Ether (ETH) has seen a 36% year-to-date increase in its price in 2023 in U.S. dollar terms. This recovery, however, is modest given that ETH is currently trading 66% below its November 2021 peak of $4,870.

Ethereum vs. Bitcoin: 14-month downtrend and counting

Moreover, on Sept. 20, Ether reached its lowest levels against Bitcoin (BTC) in 14 months, breaching the critical 0.06 BTC support. This has raised questions among Ether investors about the factors behind this price decline and what it will take to reverse the trend.

*Ether price / BTC at Coinbase. Source: TradingView*

ETH buyers placed their biggest hopes on protocol upgrades that significantly reduced the need for new coin issuance when the network transitioned to a Proof-of-Stake consensus mechanism.

These hopes were realized in mid-September 2022, resulting in an annualized issuance rate of just 0.25% of the supply. This transformation aligned with the Ethereum community's vision of "ultrasound money."

Furthermore, the subsequent Shapella upgrade on April 12 allowed for withdrawals from the native staking protocol, addressing a major concern for investors. Previously, both the 32 ETH deposits and the yield from participating in the network consensus were locked up indefinitely.

Confidence among Ethereum enthusiasts grew as these significant hurdles were crossed with minimal issues. They anticipated that the price of Ether would surpass $2,000, a prediction that came true on April 14.

However, this optimism was short-lived, as ETH's price promptly fell back to the same $1,850 level just a week later.

Notably, instead of witnessing a net withdrawal, Ethereum staking experienced a net inflow of 3.1 million ETH in the 30 days following the Shappela upgrade, surpassing even the most optimistic expectations.

Given that the Ethereum network's planned developments have generally been on track, albeit with the customary delays, investors now need to explore other potential catalysts for reversing the current downtrend in Ether's price relative to BTC.

External factors present important triggers for ETH price

One of these potential catalysts lies in the ongoing legal battle between Ripple (formerly Ripple Labs) and the U.S. Securities and Exchange Commission (SEC), which could significantly impact Ether's price momentum.

The SEC contends that XRP sales to retail investors constitute a security offering. However, in July, Judge Analisa Torres ruled that XRP generally does not qualify as a security under SEC guidelines, especially when distributed through exchanges.

As noted by the "American Lawyer and Bitcoiner" Bryan Jacoutot on a social network, the Ethereum Foundation remains exposed due to the pre-sale of ETH directed toward institutional investors and subject to a lock-up period.

(1/12) ANALYSIS: I've reviewed the district court ruling on XRP and it rests on very shaky ground. Expect an appeal.

AND Ethereum Foundation remains at risk even if its upheld because of important distinctions in the methods used by Ripple to sell the "pre-mine"

⬇️⬇️
— Bryan Jacoutot (@BryanJacoutot) July 13, 2023

According to Jacoutot, even if Ripple were to secure a favorable outcome, it wouldn't immediately mitigate the risks for Ethereum. Nevertheless, it's undeniable that the regulatory uncertainty surrounding the Ether ICO remains a source of concern for investors.

On Sep. 20, an Ethereum address associated with the ICO era showed its first activity, transferring 32.1 ETH (valued at $52,000 at the time) directly to Coinbase. This additional movement only amplified regulatory concerns since there are no apparent incentives for addresses that have remained dormant for four to eight years to divest at this particular point in the market cycle.

An Ethereum ICO participant who has been dormant for 8 years transferred 32.1 $ETH to #Coinbase just now.

The address received 200 $ETH at Ethereum Genesis.

And the address appears to be related to shemnon.eth (@shemnon).https://t.co/nj5eF8iRT0 pic.twitter.com/6Viytn4dU5
— Lookonchain (@lookonchain) September 20, 2023

A similar occurrence unfolded with an address linked to Vitalik Buterin, which sent 300 ETH (worth $490,000 at the time) to the Kraken exchange on Sep. 19.

More positive news gives hope for Ethereum investors

On the news side, Ethereum has seen some positive surprises, such as the unexpected request for a spot Ether exchange-traded fund (ETF) by ARK Invest and 21Shares on Sep. 6. This development reduced the risks associated with excessive institutional concentration in Bitcoin, particularly if the ETF is approved.

Additionally, Canto, a layer-1 Cosmos-native blockchain, announced its migration to Ethereum's layer-2 on Sep. 18. This Zero-Knowledge, permissionless rollup, compatible with the Ethereum Virtual Machine (EVM), is primarily focused on bringing traditional finance into the Ethereum ecosystem.

Should Bitcoin's price surge be driven solely by the approval of a spot Bitcoin ETF or inflation concerns in the U.S., Ether is well-positioned to follow suit, benefiting from the same catalysts.

Meanwhile, Ethereum's primary competitors in the decentralized applications sector, namely Solana (SOL) and BSC Chain (BNB), face similar risks pertaining to ICO and securities regulations, making it unlikely for them to challenge Ethereum's dominance in terms of total value locked, or TVL, and trading volumes.

This article is for general information purposes and is not intended to be and should not be taken as legal or investment advice. The views, thoughts, and opinions expressed here are the author’s alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.

Bitcoin short-term holders ‘panic’ amid nearly 100% unrealized loss

September 21, 2023 Coin Telegraph

Analysis

Bitcoin speculators are dealing with "a degree of panic" as their BTC holdings sit in unrealized loss, says Glassnode.

Bitcoin (BTC) speculators are in “panic” mode as nearly all of them are in the red, research says.

In the latest edition of its weekly newsletter, “The Week On-Chain,” analytics firm Glassnode revealed 97.5% unrealized losses among Bitcoin’s short-term holders (STHs).

Research warns of "non-trivial" Bitcoin sentiment slide

BTC price action in recent months has tested the resolve of investors, but none more so than those who bought BTC over the past three months.

STHs, which correspond to entities hodling coins for 155 days or less, have seen their aggregate cost basis fail as market support.

As Glassnode notes, as of Sep. 17, the cost basis for those not spending BTC is now $28,000 — around 5% above current spot price.

As part of its research, the firm separated the STH cohort into holders and spenders, discovering “a relationship between abrupt changes in implied (unrealized) profitability and the shift in spending by STHs (realized profitability).”

The result, it says, is what it calls a “non-trivial change in sentiment.”

“From this perspective, we can see that the cost basis of STHs who are spending fell below the cost basis of holders as the market sold off from $29k to $26k in mid-August,” “The Week On-Chain” explained.

“This suggests a degree of panic and negative sentiment has taken hold in the near term.”

*Bitcoin STH holder and spender data annotated chart (screenshot). Source: Glassnode*

"A degree of panic"

The findings chime with the overall sense of caution among Bitcoin traders and analysts, with many predicting a test of lower levels still to come.

Opinion is far from unanimous, however, as optimists eye a change of fortunes for BTC price performance beginning in Q4.

As Cointelegraph reported earlier this week, meanwhile, classic sentiment gauge, the Crypto Fear & Greed Index, remains only modestly bearish at current price levels.

*Crypto Fear & Greed Index (screenshot). Source: Alternative.me*

Nonetheless, for STHs, the threat of permanent loss appears to feel all too real.

Glassnode analysts unveiled a trend confidence metric, which subtracts spender cost basis from holder cost basis and divides by the BTC price.

“The Bitcoin market is experiencing a non-trivial shift in sentiment, with almost all Short-Term Holders now underwater on their supply,” the firm wrote in part of its conclusion.

“This has resulted in a negative shift in sentiment, with investors spending now having a lower cost basis than the rest of the cohort. This suggests a degree of panic is dominating this group, which is the first time since FTX collapsed.”

*Bitcoin new investor confidence annotated chart (screenshot). Source: Glassnode*

This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.

Interest rate hikes may pause very soon — Here’s why

September 19, 2023 Coin Telegraph

Analysis

This week, The Market Report discusses Bitcoin’s recent price action and the upcoming FOMC meeting, where some speculate interest rates might be paused.

On this week’s episode of The Market Report, analyst Marcel Pechman discusses Bitcoin’s (BTC) strength ahead of the United States Federal Reserve’s Federal Open Market Committee (FOMC) meeting , with investors betting on an interest rate freeze.

Pechman expresses skepticism about the claim that recent inflation data indicated the Federal Reserve’s 2% target was within reach, citing the time lag for interest rate changes to impact inflation and previous instability caused by rate increases.

Moving on, Pechman addresses the decreasing supply of Bitcoin on exchanges, seen as a bullish signal. However, he disagrees that this alone was responsible for Bitcoin’s price surge. Marcel also ponders whether this activity was related to the FOMC meeting but considers it unlikely to be a short-term event.

The next topic covered in the show is the Securities and Exchange Commission’s request to access Binance.US’ software. Pechman explains that while it might seem like the SEC faced a loss in court, the judge expressed doubts about Binance.US’ control of its assets and requested more evidence.

Pechman speculates that Binance was seeking a delay and extension to provide documents or reorganize its operations. Pechman emphasizes the judge’s remarks against Binance and acknowledges the challenges it might encounter in dismissing the accusations, as well as the potential implications for the exchange’s future.

Listen to the full episode of The Market Report on the new Cointelegraph Markets & Research YouTube channel, and don’t forget to click “Like” and “Subscribe” to keep up-to-date with all our latest content.

Bitcoin’s cycles are changing — Bloomberg analyst Jamie Coutts explains how and why

September 14, 2023 Coin Telegraph

Analysis

This week’s episode of Market Talks discusses how Bitcoin cycles are changing and how it could impact the upcoming halving.

In the latest episode of Cointelegraph’s Market Talks, host Ray Salmond speaks with Jamie Coutts, a chartered market technician and crypto market analyst at Bloomberg Intelligence.

When asked whether Bitcoin’s (BTC) pre- and post-halving price action could differ from previous cycles due to a change in global monetary policy, Coutts said:

“I’ve been writing about this for most of the year. We do have some strong fundamentals in the space, but ultimately, what drives risk assets is liquidity. The longer that we have this tightening cycle, and if we start to see an uptick in unemployment and more stress in the banking sector, then there could be a bit more pain for risk assets like Bitcoin.”

Despite the dim macroeconomic outlook, Coutts did suggest:

“We could be near the end. There is still a lot of underlying stress in the U.S. banking system and other areas of the economy. I think this is somewhat different to any other Bitcoin cycle that we’ve seen, but ultimately, people will need to keep in mind that we are living in a fiat and credit-money-based money system, and inevitably, there will need to be a return to some form of easing because essentially the system cannot handle long periods of deflation. So, it is still Bitcoin, and to some degree, crypto assets that have control of their inflation schedules that will do well when things start to resume.”

To hear more about Coutt’s views on the macro, Bitcoin, Ethereum, altcoins and stablecoins, tune in to the full episode of Market Talks on the new Cointelegraph Markets & Research YouTube channel. Also, don’t forget to click “Like” and “Subscribe” to keep up-to-date with all our latest content.

Bitcoin at $25K: Discount or disaster?

September 13, 2023 Coin Telegraph

Analysis

This week, The Market Report discusses Bitcoin’s recent dip below $25,000 and what it means for the near future. Was it a discount or a disaster?

In the latest episode of The Market Report, Cointelegraph analyst Marcel Pechman delves into Bitcoin’s (BTC) latest bounce at $25,000, which some analysts and influencers argue represents a short-term buying opportunity. Pechman explains that Bitcoin’s inverse correlation with the U.S. Dollar Index has only held for 40% of the previous 20 months, meaning it is likely not a good metric to anticipate price movements.

The show then shifts focus to a recent Glassnode report revealing that the amount of BTC changing hands is at its lowest since October 2020, citing investors’ “apathy” and “exhaustion.” Pechman argues that bulls got tired after the United States Securities and Exchange Commission’s relentless action to pursue Coinbase and Binance. Ultimately, Pechman disagrees that Bitcoin’s recent movement to $25,000 presents an opportunity for buyers, given that the short-term risk-reward ratio near the current price level is around 50:50.

For the show’s next segment, Pechman analyzes the prediction made by Davis Hui, vice president of Bitcoin miner Canaan, that BTC will hit $100,000 in 2024 based on the halving and a spot exchange-traded fund (ETF) approval. First, Pechman explains that BlackRock’s $10 trillion in assets is merely a mirage, as 55% is stuck in fixed-income investments and $2.8 trillion is already invested in other ETFs such as commodities, the S&P 500 index, global emerging markets and alternative investments.

Furthermore, Pechman raises the risk of current holders deciding to flip their positions previously bought at $60,000, $50,000 or even $40,000 if Bitcoin’s price were to shoot up, meaning the offer side is never predictable regardless of miners’ incentives. Lastly, Pechman explains that a spot Bitcoin ETF has been a dream for the past eight years, and nothing has changed to refute the SEC’s reasons for dismissal, namely stablecoin trading volumes and unregulated offshore exchanges.

Check out the latest episode of The Market Report, available exclusively on the Cointelegraph Markets & Research YouTube channel.

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The Fed could lose $100B — Does this spell catastrophe for Bitcoin?

September 8, 2023 Coin Telegraph

The Fed could lose 0B — Does this spell catastrophe for Bitcoin?

Analysis

On the latest episode of “Macro Markets,” Marcel Pechman explains the potential implications for crypto of the Federal Reserve losing $100 billion.

On this week's episode of “Macro Markets,” Cointelegraph analyst Marcel Pechman delves into a thought-provoking discussion on the United States Federal Reserve’s financial woes. Pechman opens by highlighting how the Fed is grappling with staggering losses and emphasizes a fundamental macroeconomic principle: that overall wealth cannot be universally enhanced as demand for goods and services grows.

This discrepancy underscores the challenges posed by inflation, real estate prices and the consequences of the Fed’s policies. Pechman concludes that the Fed is now paying the price for its loose monetary approach during the pandemic, prompting a grim outlook for the U.S. Treasury Department’s finances.

Shifting gears, Pechman moves on to discuss European markets, with a spotlight on Novo Nordisk’s remarkable ascent. The Danish pharmaceutical company has momentarily overtaken luxury goods giant LVMH as Europe’s most valuable company. Pechman notes that the astonishing success of Novo Nordisk, particularly its weight-loss drugs Ozempic and Wegovy, caused Denmark’s gross domestic product growth forecast to be revised upward.

In a final intriguing twist, Pechman touches upon the intersection of traditional companies and cryptocurrencies as he speculates on the potential for traditional companies to adopt cryptocurrency-based revenue distribution methods through smart contracts. While he acknowledges the promise of this concept, Pechman underscores the current immaturity and complexity surrounding such endeavors, emphasizing that the sector is still in its infancy.

For additional details and the complete analysis, check out the new Cointelegraph Markets & Research YouTube channel.

Will Evergrande’s collapse have a silver lining for crypto?

August 30, 2023 Coin Telegraph

Analysis

This week, The Market Report discusses Grayscale’s victory against the SEC, the impact of Evergrande’s bankruptcy, and what happened to the 16 trillion PEPE tokens reportedly stolen.

On the latest episode of The Market Report, Cointelegraph analyst Marcel Pechman delves into Grayscale’s victory against the United States Securities and Exchange Commission. Even though there’s still no decision regarding the firm’s application for a spot Bitcoin (BTC) exchange-traded fund, the decision was favorable for Grayscale and its Grayscale Bitcoin Trust, which has over $16 billion in assets under management.

Next, Pechman discusses the impact of Chinese real estate giant Evergrande’s bankruptcy and questions why it took almost two years to announce the company’s inability to repay its debt. According to The Kobeissi Letter, it seems related to China’s recent unexpected cut in interest rates.

Pechman reminds viewers that China recently announced several measures to stimulate the stock market. Ultimately, he agrees that an eventual collapse of the Chinese markets would be negative for risk-on assets, including stocks, cryptocurrencies and commodities.

Still, Pechman argues that in a separate movement, maybe one to 10 months later, there could be a shift toward Bitcoin as investors realize they’re being diluted by the government’s inability to sustain itself without injecting liquidity, which could benefit cryptocurrencies.

Lastly, Pechman explains what happened to the 16 trillion Pepecoin (PEPE) tokens reportedly stolen and gives advice on how to avoid getting rug-pulled on altcoins. For further insights into all of these matters, tune in to the latest episode of The Market Report, exclusively available on the newly launched Cointelegraph Markets & Research YouTube channel.

Bitcoin velocity hits lows last seen before Q4 2020 BTC price breakout

August 26, 2023 Coin Telegraph

Analysis

Bitcoin investors sit on their hands at $26,000 — can a velocity rebound reproduce the kind of breakout seen three years ago?

Bitcoin (BTC) on-chain activity is at levels last seen before its run to 2021 all-time highs, data shows.

In an X (formerly Twitter) post on Aug. 25, Ki Young Ju, CEO of analytics platform CryptoQuant, revealed multiyear lows in Bitcoin velocity.

Bitcoin supply stagnates at $26,000

Bitcoin is becoming increasingly static at current price levels — with an overall BTC price trend absent for months, the impetus to buy or sell is reduced.

Underscoring this status quo is velocity, which is a measurement of BTC units moving around the network.

According to CryptoQuant, on daily timeframes, the metric is now at levels last seen in October 2020.

“There are two sides to this situation,” Ki commented.

“It can be seen as positive since whales are holding onto it, or negative since it’s not being transferred to new investors.”

*Bitcoin velocity chart. Source: CryptoQuant*

Ki referred to a similar absence of major trading activity among high-volume investors — part of a narrative that states that the market is in “wait and see” mode on BTC.

As Cointelegraph reported, new money entering the space was visible at the beginning of the year, as BTC/USD began its Q1 winning streak, which ultimately totaled 70%.

“Oversold” RSI signal persists

The volume data meanwhile appears significant for another reason.

In late 2020, once it put in a long-term bottom, the metric’s rebound accompanied Bitcoin’s first ascent past $20,000 to new all-time highs a year later.

Unlike then, however, Bitcoin appears broadly oversold at its current $26,000, per its daily relative strength index (RSI) as measured by Cointelegraph Markets Pro and TradingView.

As Cointelegraph reported, the 12-hour RSI hit its lowest in five years this month and has yet to recover — again reflecting a return of investor interest still to materialize.

*BTC/USD 1-day chart with RSI. Source: TradingView*

Collect this article as an NFT to preserve this moment in history and show your support for independent journalism in the crypto space.

This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.

Does high US consumer debt benefit Bitcoin price?

August 25, 2023 Coin Telegraph

Analysis

Cointelegraph analyst and writer Marcel Pechman breaks down consumer debt and why it might lead to a good outcome for BTC.

On the latest episode of Macro Markets, Cointelegraph analyst Marcel Pechman explains why United States consumption remains strong while auto-loan and credit card balance delinquency is accelerating. According to Pechman, consumers built a cushion of extra cash savings as the U.S. government injected money to avoid a recession and temporarily forgave student loan repayments.

But, according to investment bank JPMorgan, “consumers have spent down the entirety of their excess savings from the pandemic, which at one point totaled more than $2 trillion,” as reported by Business Insider. Pechman believes that if JPMorgan’s predictions are correct, the stock market should have been trading much lower. Still, Pechman doesn’t think that betting against the S&P 500 is sound advice, given that inflation is right around the corner and the government will be forced to inject liquidity to avoid a recession.

For the show’s next topic, Pechman dissects the Chinese central bank’s intervention after the yuan hit a 16-year low against the U.S. dollar. For Pechman, the biggest risk is the market doubting the country’s ability to sustain a stronger yuan, meaning betting that the People’s Bank of China’s reserves won’t be enough to sustain the desired level.

In essence, what the Chinese central bank is doing has limits and ultimately is a risky bet, argues Pechman. For now, according to the analyst, there seems to be no imminent risk coming from the yuan, but it is worth keeping an eye on.

For further insights into these matters, tune in to the latest episode of Macro Markets, exclusively available on the newly launched Cointelegraph Markets & Research YouTube channel.

Analysis

Ethereum vs. Bitcoin: 14-month downtrend and counting

External factors present important triggers for ETH price

More positive news gives hope for Ethereum investors

Research warns of "non-trivial" Bitcoin sentiment slide

"A degree of panic"

Bitcoin supply stagnates at $26,000

“Oversold” RSI signal persists

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