The Crypto market
is seen to be booming as Bitcoin prices rose by 19% and Ethereum coins added
50%. Major cryptocurrencies have lost more than 50% of their highs since the beginning
of June, so a recovery was expected. The major question now is whether the
bulls can hold onto gains? There are a few chances for this to become a reality.
In order to
assess the Crypto market’s trends we have to look at the Bitcoin price chart,
which would designate the rest of the market. BTC prices are moving inside an
upward channel with the lower margin designated by $17,500 and $18,900 previous
lows. Such a formation is likely to be temporary before the price continues to
move alongside the global downward trend. The price is likely to spike over the
upper margin of the channel to return back inside the channel and plunge below
the lower margin. So, the first price target is seen at $17,600 per coin.
Ethereum
prices are moving sweepingly compared to BTC and they are above the upper
channel margin. Further price dynamics of the ETH is restrained by BTC
movements. Fundamental factors are not greatly affecting digital assets, and
the news of Proof-of-Stake protocol that is expected to be introduced in the
Ethereum network in September, could hardly change price trends.
The
bankruptcy of the 3AC Fund continued with more than $2.8 billion claims adding some new claimants like Coinlist, Algorand, Moonbeam Network, and
the Digital Currency Group. The Coinlist itself has a poor reputation because
of rumours about the manipulation of clients’ funds that were collected at the
launchpad stage. These funds could be used to credit other cryptoprojects,
though this matter should not worry anyone in the cryptomarket right now but
they should be prepared for the fact that financial troubles of major
institutional players in the market will probably have long-term consequences.
A general sentiment in
the financial markets is rather pessimistic amid fears of nearing debt service
troubles. These troubles may result in CDS (Credit Default Swaps) fees on some
assets. Such credit events occurred in 1998 and 2008. The price of CDS surged
dramatically to March 2020 levels, signalling an overall pessimistic sentiment
in the market.
Rising costs of Dollar
funding and the strengthening of the Greenback itself may prompt many defaults,
outside and within the Crypto market. Fears over real estate market bubbles and
second-hand cars market troubles may contribute to the worsening situation
making investors shy away before the situation improves.