Fundamentals Report #106

September 11, 2020  |  Issue #106  |  Block 647,779  |  Disclaimer

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Vital Bitcoin Stats

Weekly price:  $10315  (-$113, -1.08%)
Mayer Multiple: 1.15
Est. Difficulty Adjustment: +7% in 9d
Prev Adj: -1.2%
Sats/$1 USD: 9694
1 finney: $1.03


Market Commentary

Quiet Before the Storm

Bitcoin
All in all it's been a quiet week in Bitcoin. Price is almost exactly where we left it last week, hash rate is up, developers are fighting, and toxic maximalists are calling chairs scams LOL.

Scam coins
Even altcoins were quiet this week. Ethereum's crash has paused after a 35% loss and Sushi Chef, Founder of the recent Sushi token, showed why all altcoins are scams when he dumped and exit-scammed with $10 million dollars. The altcoin hype seems to be subsiding for the time being.

Traditional markets
From our vantage point, the CCP in China is struggling to hold on. They are stockpiling massive amounts of commodities, perhaps to mask an economic slowdown. If they want to hide the amount that their economy is slowing, they would continue importing commodities but stockpile them instead of use them. The CCP is also heavily subsidizing factories to keep them employed. Where the US is subsidizing consumers, China is subsidizing producers. Neither is worse or better exactly, but since production is easier to move than consumers, China will be hard pressed to keep manufacturing in their country. Lastly, militarily, the China/India border dispute is still simmering, where India appears to have the upper hand, and a Japan/India arms deal was recently penned.

We concentrate on the CCP so much, because it will be the first major casualty of the coming reordering of the globe.

Overall, the Quiet Before the Storm extends to traditional markets. The dollar has bottomed but is slow to do anything substantial. US stocks have pulled back slightly though nothing worrying yet, and Trump's landslide victory is almost guaranteed.

It might be that our volatile end of Q3 prediction comes true, because it's too quiet out there now. Volatility will return soon.

Other Top Stories

IRS offers $300k bounty to anyone who can break Bitcoin's Lightning Network
The IRS wants to be able to track lightning transactions, which should tell us that they are having a hard time doing that and they are just looking into it now.

Kazakhstan in talks on $700 mln in cryptocurrency mining projects
13 mining farms are located in Kazakhstan today, reportedly accounting for 6% of all cryptocurrency mining. This year they've clarified their tax guidance on mining, and to date have had $190 million invested into those mining farms. Boosting investment to $700 million is huge and should make them a major player in the future.

The next phase for Pseudo-finance (Defi) is centralized Uniswap/Sushiswap replacements, (Binance and Crypto.com are releasing competitors), along with "stablecoin platforms/protocols" or networks created to facilitate tokens like Tether and USDC. Gone are the days of "smart contract platform". Eventually, they'll end up on Liquid Network or completely centralized as regulators struggle to keep up.We need your support!Support this free content!


Price

Weekly BMI |  0 : Neutral

On last week's Report, price was $10,420 and it's $10,300 at the time of writing. Throughout the week there has been no major moves either way. If you were expecting a bounce, it feels bearish, however, if you were expecting more of sell off from bitcoin and stocks, it's starting to feel bullish.

It is very likely price moves down $9660 to fill the CME gap, even if for a minute. In the 3 year history of Bitcoin CME futures, every single gap has been filled. We do not expect price to break down from here, only fill that gap and then bounce.

If you'd like more technical and fundamental analysis on the bitcoin price, check out out paid Bitcoin Pulse newsletter.


Mining

The difficulty adjusted down 1.2% on Monday this week and is currently trending to adjust back up ~7% in about 9 days. It's worthy to note that the Hashrate hit an ATH earlier this week!


Stablecoins / CBDC / Altcoins

Tether Dominance : 11.3% (+0.2%)


A very interesting correlation here between the S&P500 and bitcoin. Bitcoin is fundamental uncorrelated with other assets, so this finding might be the result of  only two temporary periods of correlation (the first two red arrows). Short periods of correlation appear and then disappear. If we were to take out 5 dots in each of those two periods, there would be no overall correlation. But what do we know, we aren't statisticians.

Source


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Written by Ansel Lindner and Jeff See

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