Bitcoin Oversold (They Misunderstood Halving), Fear Appears to Be Moving the Markets

After commencing the year of 2020 with evident gains and rises, Bitcoin found a major drop of over -50% on March 12th, trading between the value of 5,046$ and 5,641$ during the mentioned period. Despite the drop, Bitcoin gained back around 37% on its value during the rise that followed, currently trading at the value of 5,200$. Analysts have been trying to come to the bottom of the problem that became evident with the major drop of Bitcoin that lost almost half of its value, concluding that the news on the Coronavirus is having a negative impact on all markets. That is how it has become a general opinion that the fear brought with the pandemics of Coronavirus is also meddling with the price of Bitcoin and the stability of the cryptocurrency market.

In addition, all markets and various assets and businesses are also being affected by the ruling fear caused by COVID-19. Based on indicators brought up with the latest technical analysis, Bitcoin is showing neutral momentum, which leaves analysts uncertain in the sense of which direction Bitcoin should move next. Based on all indicators, Bitcoin seems to be oversold. There are also indicators showing that Bitcoin could easily take an upward turn and follow a bullish path. What the latest indicators are showing in the case of the dropping price of BTC is that traders are collecting profit instead of opening positions on breakouts and opening long positions.

Is Ethereum Volume Related to Twitter Activity Mentioning ETH

The price of Ethereum dropped by around -40% in the course of a single week in March 2020, following the -50% drop in the price of Bitcoin that is currently trading at the value of 5,200$. After losing around -40% of its value, Ethereum hovered around the price of 100$, struggling to go above. However, Ethereum bounced back up, collecting gains and managing to regain some of the lost value, trading between 120$ and 130$ and well above the value of 100$ per one ETH. Back in 2017 when Bitcoin and Ethereum were heavily on the rise, Ethereum was mentioned on Twitter on an average of 12,000 times daily during the year 2017. Strangely, the number of tweets mentioning Ethereum topped over 15,000 tweets daily in 2018, which is the year when Ethereum showed -76% on annual returns, losing a substantial part of its market value. That was at the same time the highest number of average daily tweets mentioning ETH. The number of tweets including Ethereum severely declined in 2019, dropping below 5,000 tweets per day.

Some analysts decided to reveal the connection between the price of ETH and its momentum with Twitter mentions of ETH, focusing on the case of 2017. When the number of tweets on a daily basis increased by 1%, the price of ETH increased by 1.6% the same day. That trend continued throughout 2017, so traders could predict the momentum of ETH based on the mentions of ETH on Twitter. However, this trend seems to have come to an inversion when it comes to 2019. Apparently, when the number of tweets increased by 1%, ETH would drop by -0.6% as a consequence. Based on the connection between the price of ETH and tweets mentioning Ethereum and Ether, it can be determined that tweets don’t have any firm connection with returns. However, 2017 did show a clear connection between the two, predicting that this could be the case with 2020 since ETH is rising in the price alongside the rising number of average daily tweets mentioning Ether.

Bitcoin Following Downtrends, YouTube Keeps the Ban on Crypto Videos

It seems that the rough times are not sparing any market, including the market of cryptocurrencies as Bitcoin is seen plunging while losing -50% of its value before the crypto was able to take an upward trend and regain around 37% of its value in March 2020. Over the last week, Bitcoin lost -15% of its worth, however, predictions from the crypto community’s top evangelists are remaining positive about the future predictions on the price of BTC. For instance, Max Keiser from RT believes that the price of Bitcoin should top the value of 100,000$ per one BTC due to the outbreak of Coronavirus, while the traditional markets would remain to plunge with the crisis. In the meantime, YouTube is still keeping the ban on cryptocurrency videos, remaining unclear on which videos are prohibited from reaching the platform, that way meddling with the general outreach of cryptocurrency enthusiasts and services through their media platform.

Paul Gosar, US congressman, is working on the new act for 2020 that should help regulate crypto assets and assign them to appropriate regulators. At the same time, mining Bitcoin has become more expensive in addition to expecting more increases in mining expenses with the upcoming Bitcoin halving that should take place in May. On the bright side of events, China is showing a major interest in cryptocurrencies, offering 4.7 million dollars to the People’s Bank of China so the bank could research and develop a blockchain-based financial platform.

MakerDAO Emergency Shutdown Creates a Debt Bubble

The decision of the Maker team to shut down MakerDAO once a debt of 4 million dollars was noted on the DeFi platform is not passing at the time. In case that the platform would pass the decision to shut down, all DAI stablecoins would convert into ETH (Ether). The fault in the system cost the network 4 million dollars that were taken for free since the system or generating collateralized debt positions failed to update the pricing of Maker with the congestion on the Ethereum network. The debt continued to rise from the initial 4 million dollars, getting close to 6 million dollars and topping 5.7 million with the latest update. MKR holders voted on several issues on the matter of normalizing the network’s functions and operations, while the Maker team should address debt auctions, DAI peg, and system debt.

At the same time, the MakerDAO community voted in favor of adjusting the network’s risk parameters. The voting also included the matter of increasing the supply of DAI on the market. Additionally, interest rates for DAI increased by 22%. DeFi entrepreneur, Ryan Berckmans, stated that MKR traders and buyers should be prepared for sustained prices of GAS in addition to downward pressure on ETH and MKR, adding that it is expected to see the global markets crashing further from this point, which may include drops and plunges in the market of cryptos as well.

Coronavirus Prepping: Where is Crypto At

Prepping for the worst in the sense of global economic crisis and economic collapse such as it was the case during 2007 and 2008 when the markets crumbled, seems to be a part of the philosophy behind the concept of cryptocurrency. With Coronavirus, COVID-19, becoming a global problem with the progress of pandemics, some Twitter names have been urging other people to prepare for a possible crisis. The crypto enclave made sure to warn everybody about the importance of staying prepared and being prepared, urging people to prep weeks ahead of the global outbreak. A part of the crypto community is already prepping for the worst by investing in cryptocurrency and holding their assets.

Judging by one of the latest tweets made by one of the members of the broad crypto community on Twitter believes that there would be areas quarantined from 3 to 6 months, also expecting global crisis and recession. Besides, the crypto member under the name Ryan Selkis believes that the USA will have a reset of their health care model while the potential recession could border depression. It also appears that crypto-related businesses started prepping well before the governments decided on the work-from-home policy and other preventive measures that would stop the progress and spreading of COVID-19. Ryan Selkis decided to make the work-from-home policy effective even before other businesses decided to do so, considering the virus to be a big deal. In a way, skepticism revolving around crypto-driven businesses have made crypto businesses more aware of how prepping is important, and why.

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Author: Tokens.net Team
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