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US Crypto Exchange Kraken Predicts Bitcoin Price Will Rally in October

US-based crypto exchange Kraken has released its September 2020 volatility report which predicts that Bitcoin’s price will likely rally in October after a further separation in correlation from traditional markets and the US dollar.

According to Kraken’s September 2020 volatility report, all indicators show that Bitcoin’s correlation to legacy markets and the US dollar is continuing to weaken.

According to the Kraken report:

“Bitcoin’s correlation with the S&P 500 sank to an 8-month low of -0.27 in the first week before rebounding and finishing the month at 0.60. Inversely, bitcoin’s correlation with the U.S. dollar index (DXY) momentarily turned positive before resuming a 5-month trend of negative correlation.”

The Kraken report states that with Bitcoin coming off what is historically the least volatile month of the year—September—one ought to expect incremental market volatility to surface as of 4Q2020.

The report adds that several factors have not yet been exhibited in Bitcoin’s price. Per the report:

“The ever-growing number of addresses containing between 1,000 BTC and 10,000 BTC and the number of coins held in these addresses suggests that Bitcoin’s strong fundamentals and vigorous demand from “smart money” is not entirely reflected in bitcoin’s price.”

What to Expect in October?

The Kraken report predicts better returns on Bitcoin in October stating that historically, Bitcoin sees and average return of around 11% following the conclusion of its lowest month, September.

Per the Report:

“With bitcoin’s worst-performing month now behind us, October may outperform September, just as it has for 8 of the past 9 years, with an average return around +11%. Note that bitcoin has underperformed its monthly average in 6 of the past 9 months.”

The report also indicates that a large number of BTC whale addresses containing “1,000 BTC and 10,000 BTC continues to grow strongly” as well as the total number of coins held in these addresses. The numbers indicate “a strong pattern of accumulation that started about 7 months ago.”

Along with the amassing BTC whale wallets, further positive signs for the Bitcoin price have been highlighted by the increased institutional demand. At the time of writing, there is almost $7 billion of Bitcoin currently held by 13 publicly listed companies, notably MicroStrategy, Square, Galaxy Digital and Grayscale.

Why Bitcoin’s Price Is Rising Despite Selling Pressure from Crypto Whales

According to on-chain data analytics firm CryptoQuant, Bitcoin whales have been depositing their digital asset funds into exchanges recently, potentially signifying an intent to sell.

Data shows Bitcoin deposits to exchanges have gone up

Typically, wealthy investors hold their Bitcoin (BTC) funds in cold storages – offline – rather than exchanges, the reason being that it secures their huge amount of digital assets and eliminates a potential security breach from hackers. However, though it has not happened yet, blockchain analytics seem to indicate that Bitcoin whales may soon be selling some of their cryptocurrency capital, as more deposits have been made to cryptocurrency exchanges.

Though crypto selloffs usually result in the digital currency’s price dropping slightly, it has been observed that Bitcoin has been more bullish now than ever, despite the seemingly growing selling pressure of the digital asset. A crypto enthusiast retweeted by the CEO of CryptoQuant analytics firm said:

“#Bitcoin’s macro view remains bullish as the Exchange $BTC Balances continue to decline sharply since March (whales are not yet selling. Even at $13,000.) There’s also around 136k BTC currently locked in WBTC/RenBTC.”

Why Bitcoin is surging despite selling pressure

According to market analysts, there may be two explanations for Bitcoin’s current rise in price despite the forecast of Bitcoin whales preparing to liquidate their crypto funds.

First of all, demand for Bitcoin and the number of investors willing to onboard the mainstream cryptocurrency may be greater than the selling pressure of Bitcoin from retail and institutional investors. As the cryptocurrency rises in popularity, many are actively seeking to onboard its escalating success and secure their funds through Bitcoin as a hedge, with the current global economy in turmoil and the US dollar continuously depreciating.

Second of all, the institutional demand for Bitcoin has been growing significantly, popularizing the cryptocurrency as an optimal hedge for retail investors. With the recent news of Square acquiring $50 million dollars’ worth of Bitcoin, along with MicroStrategy and Stone Ridge Asset Management’s respective $425 million and $115 million BTC purchase, others have increasingly considered the mainstream cryptocurrency as an alternative investment.

The last announcement by payments giant Paypal that it would let its customers transact with cryptocurrencies on its platform also resulted in Bitcoin leaping past a price hurdle of $13,000. This indicates that retail investors’ sentiments regarding Bitcoin is strong, and may serve to up its price despite selling pressure.

Bitcoin to decouple from the S&P 500 soon?

The cryptocurrency has been extremely bullish lately, trading at $13,127.62 on CoinGecko at the time of writing.

Market analysts have been enthusiastic about the bull run, as it appears that the cryptocurrency may finally be decoupling from traditional stock markets, a move that BTC has previously been incapable of. Gemini co-founder Cameron Winklevoss, who along with his brother has long touted the advantages of owning Bitcoin, said:

“Stocks took a dive today. #Bitcoin is flat. The decoupling is upon us.”

Ripple (XRP) Whale Addresses Reach New All-Time High as Price Surges, Despite Regulatory Unclarity

Ripple (XRP)’s price had performed highly last week, gaining over 6 percent. Ripple (XRP) is currently trading at $0.270880 at press time, according to CoinMarketCap. Data suggests that as the number of holders with large amounts of XRP has been rising, also contributed to the coin’s price surge.

According to crypto analytics firm Santiment, XRP is currently the tip rising asset in discussion rate on cryptocurrency platforms. The analytics firm also explained that there has been an increase of holders with coins containing large amounts of XRP. Santiment explained:

“$XRP has had an impressive +8.4% week, and it’s currently the #1 rising asset in discussion rate on #crypto platforms. The rise of holders with coins containing large amounts of $XRP has been very apparent, as addresses with 10-1M tokens are at new ATH’s.”

Santiment data showed that the current XRP holders with more than 1 million tokens have reached an all-time high of 17,625.

XRP’s price has been trading at the range of $0.23 to $0.26 for nearly two months, before breaking out of its range to trade above $0.27 at press time. Ripple’s price also recently started to break out, comparatively to Bitcoin (BTC) and Ethereum (ETH). A crypto trader tweeted:

“$XRP starting to break out vs $BTC $ETH and $USD? Weird how that’s happening at this pivot. When retirement?”

Ripple XRP classification as a security remains unclear

The question of whether Ripple’s XRP token should be classified as a security remains unclear and has been one of the main reasons as to why the blockchain firm has considered relocating its main headquarters outside of the United States.

The status of XRP remains unclear as the US Securities and Exchange Commission (SEC) has not made a clear regulatory decision on XRP’s legal definition as a digital asset.

If it were to be considered a security, regulations surrounding XRP would fall under the SEC’s jurisdiction. If classified as a commodity, then it would be up to the Commodity and Futures Trading Commission (CFTC) to overlook and regulate XRP.

Why XRP was left out by PayPal

PayPal’s cryptocurrency announcement on accepting Bitcoin, Ethereum, Litecoin, and a few other large cap digital assets have taken the industry by storm. Bitcoin’s price soared shortly after the announcement, as many believe that true adoption is slowly taking place. However, Ripple (XRP) was not included in the list of cryptocurrencies PayPal decided to offer.

Charles Cascarilla, the CEO of Paxos has revealed the mystery behind PayPal’s decision of leaving XRP out of the list. Paxos Trust, was chosen by PayPal for the custody of their digital assets. In an interview, Cascarilla explained that the complications of the SEC’s regulations was the main reason behind leaving XRP out of the list.

What US regulation clarity could mean for XRP

According to a well-known crypto analyst, the price development of XRP is extremely bullish, given that it is the only project that is relentlessly pursuing the regulation of cryptocurrencies. XRP may potentially benefit massively once a legal framework for cryptocurrencies has been set in place in the United States .An analyst said:

“The only project in the entire market that is pushing for Crypto Regulations is $XRP. They know that once these regulations are added, it will completely annihilate almost every other altcoin, and make XRP’s demand skyrocket.”

Crypto Whales Moving BTC to Exchanges Sees Bitcoin Price Bounce at $17,250

The Bitcoin price corrected sharply to $17,250 as a number of crypto whales moved their BTC holding to exchanges, presumably to cash in as the cryptocurrency looked set to claim a new all-time high of $20,000.

Many analysts found vindication in their pullback predictions as Bitcoin sharply corrected from around $19,500—the BTC price losing over $1000 the space of a few minutes on Nov.26. Bitcoin then bounced at $17,250, capping daily losses of around 5%.

Popular crypto trader and YouTube personality Tone Vays told Forbes only days ago that he expected the Bitcoin bull run to end this month. He said, “It’s possible that it has already just ended, but I’ve been saying for the last ten days or so, that this bull run should end in November or early December, but I’m not expecting a bear market.”

While Vays predicted a price pullback, BTC’s drop and bounce at $17,250 is far less severe than his original prediction but it is early days. He said on Nov. 24:

“I’m expecting either significant consolidation or most likely a pullback to the $14,000 to $15,000 area over the next few months […] Then, it’ll take another month or two to get back to $20,000, and I am expecting the break of $20,000 around the end of Q1 of next year, so maybe March or April is when I’m expecting the break of the $20,000 area, and then we go up quickly.”

BTC Whales Create Selling Pressure

The sudden drop in Bitcoin’s price coincided with a number of BTC whales depositing their crypto on exchanges, ready to profit on Bitcoin’s seemingly inevitable new all-time-high, as the price climbed almost as high as $19,500.

Ki Young Ju, CEO of CryptoQuant explained the situation on Twitter. He said:

“All Exchanges Inflow Mean increased a few hours ago […] It indicates that whales, relatively speaking, deposited $BTC to exchanges.”

Source: CryptoQuant – Exchange Inflows 1-month chart

Despite the sudden selling pressure from BTC whales, Ju asserted:

“Long-term on-chain indicators say the buying pressure prevails. I still think we can break 20k in a few days.”

George McDonaugh Managing Director and co-founder of crypto and blockchain investment firm KR1 told Blockchain.News that he believed that due to the psychological implications the $20,000 Bitcoin price barrier has on crypto traders, he expected there could be also be a further sell off from ‘hodlers’ should Bitcoin hit the magic number.

He said, “$20,000 is a psychological barrier, so it is likely to be ‘hodlers’ (people holding Bitcoin forever) that may derisk at that level and produce some selling pressure. But given the comparatively small delta between where we are now at $16,000 and $20,000, it’s likely hodlers will hold out until Bitcoin gets closer to its all-time high.”

Ethereum Price Could Double In Next Two Weeks says Analyst as ETH Whales Accumulate

Surging institutional interest and on-chain data indicate that Ethereum’s short-term price surge could be far from over, as ETH whales pull their holdings off central exchanges some analysts are expecting the ETH price to double in the next two weeks.

Ethereum (ETH) set a new all-time high of $1,467.78 yesterday, its price surging as institutional investors turn bullish on the most dominant smart contract platform and most utilized blockchain for decentralized apps (Dapps) and decentralized finance (DeFi).

The world’s second-largest cryptocurrency, with a market cap of $160 billion, has risen on 90% a year-to-date basis, outpacing bitcoin’s 10% rise.

According to Defi Pulse, there is currently over $25 Billion total value locked in decentralized finance. Ethereum is the most dominant smart contract platform as the most popular blockchain application for developers and projects on which to build and launch Dapps.

In terms of further price gains for Ether—the majority of Defi protocols and the Ethereum network could be considered intrinsically linked, and the new form of digital finance has continued to boom in 2021, and Ether’s price is expected to boom in correlation.

In a note to Blockchain.News on Ethereum’s correlation to DeFi, Paolo Ardoino, CTO at Bitfinex wrote:

“The Ethereum price has pierced another all-time high. The potential of ether is becoming more and more apparent as it demonstrates a formidable capacity to support many projects. Ethereum is a key platform for building blockchain projects and is an integral part of launching decentralized applications. With DeFi protocols exceeding $19B in TVL and showing no signs of decelerating, we may see the price of ether grow alongside its use.”

Exchange Withdrawals point to ETH Whale Accumulation

As the below chart shows, centralized exchanges reached their lowest Ether reserve levels—since November 2018—last week on Jan.23

ETH On Centralized Exchanges. Source:Cryptoquant.com

Increasing withdrawals from exchanges are generally related to periods of whale accumulation. Additionally, the increased accumulation by investors with deep pockets may have put upward pressure on ether’s price and continue to do so in the short-term.

This Ether withdrawal data also coincides with the DeFi’s total value locked (TVL) reaching a $26 billion all-time high and may signals that investors are choosing to take advantage of the lucrative yield opportunities in decentralized exchanges.

ETH’s Institutional Investment Vehicle

Additionally, a sign that Ethereum is making headway and entering mainstream adoption is that the Chicago Mercantile Exchange (CME), the world’s largest derivatives platform, has announced that it is planning on launching ETH futures by February 8. Once it gains the regulatory approval of the US Commodity Futures Trading Commission (CFTC), traders will also have ETH futures as an option, added on to the current Bitcoin futures available.

This will enable investors to trade Ethereum contracts without actually holding the underlying asset, and investors can gain a profit by betting on the future price of Ether (ETH).

Ethereum Price to Double

Popular cryptocurrency analyst, Lark Davis, expects Ethereum to double in the next two weeks just “like bitcoin did.” As Ethereum left centralized exchanges, Davis tweeted on Jan. 25:

“Ethereum balance on exchanges has reached a 15 month low, and withdrawals are not slowing down. Price probably going to double in the next two weeks like Bitcoin did.”

Ethereum has gained 1,200% in value since the March 2020 coronavirus-induced market crash, compared with a 700% increase in the value of bitcoin. In 2020, the Ethereum network saw over $1 trillion worth of transactions on its blockchain – exceeding the transaction volumes of payment platforms such as PayPal.

For now, the Ethereum bull run looks set to continue and ETH is currently trading at $1,324.75 down over 6% in the last 24 hours.

Bitcoin Addresses Holding Between 100 and 10,000 BTC Hit a 7-Week High

Bitcoin (BTC) was still standing at the $40k psychological level to trade at $40,046 during intraday trading, according to CoinMarketCap.

BTC addresses holding between 100 and 10,000 BTC have been on a spending spree, given that they have added 90,000 BTC to their portfolio, as acknowledged by Santiment. The on-chain metrics provider explained:

“Bitcoin addresses holding between 100 to 10,000 BTC have accumulated 90,000 more BTC in the last 25 days. They now hold a 7-week high of 9.11m BTC, currently worth a total of $366.89Billion at this time, and 48.7% of the total Bitcoin supply.”

Therefore, Bitcoin whale addresses hit a 7-week high as they continue accumulating more coins.

Bitcoin long-term holders are the true “diamond hands”

BTC long-term holders have shown their firm stand of keeping their coins regardless of market turbulence, as alluded to by IntoTheBlock. The crypto data provider noted:

“Bitcoin long-term holders are the true “diamond hands”. YTD, the number of addresses holding BTC for more than one year has increased by 3.9%. 22.16 million addresses or roughly 58.52% of the total Bitcoin Holders are holding 9.85m BTC for more than 1 year.”

These sentiments were affirmed by on-chain analyst William Clemente III who stated that holder net position change flipped green for the first time since October 2020.

He had previously acknowledged that long-term BTC holders were stacking while short-term ones were selling.

Bulls are still not in charge

Market analyst Lark Davis believes that Bitcoin bulls are not yet dominated the market because the top cryptocurrency failed to close above the 200-day moving average (MA) despite being a stone’s throw away.

Davis recently stated that Bitcoin needed momentum to hit $43,000 for it to retake the 200-day MA.

The 200-day MA is a key technical indicator used to determine the general market trend. It is a line that shows the average closing price for the last 200 days or roughly 40 weeks of trading. Therefore, a surge above it represents the start of an uptrend.

Ethereum Whale Addresses Are Still Hovering Around an All-Time High

After hitting an all-time high (ATH) of $4,350 in April, Ethereum (ETH) Tuesday plummeted to lows of $2,000 following the recent crypto market crash.

Nevertheless, this price drop seems not to be dampening the spirits of ETH whales because they are still on a record-breaking trend, as acknowledged by Documenting Ethereum. The crypto data provider explained:

“ETH whale addresses are still hovering around an all time high.”

On-chain metrics provider Santiment echoed these sentiments.

“We see that the long-term growth rate of ETH whale addresses with 10k to 100k tokens is staying near AllTimeHighs despite the drop-off from May. Meanwhile, addresses with 10-10k continue falling.”

Ethereum whales are, therefore, bullish in the long term as they continue accumulating more coins.

Meanwhile, famous French DJ David Guetta recently revealed that he would accept the sale of a Miami beachfront apartment worth $14 million in Bitcoin or Ethereum.

23% of ETH supply locked in smart contracts

Documenting Ethereum also disclosed that 23% of ETH supply was locked in smart contracts.

Some features on the Ethereum network, like smart contracts, are widely used in the decentralised finance (DeFi) and non-fungible token (NFT) sectors. This trend has been pivotal in aiding Ethereum’s recent bull run, which saw the psychological price of $4,000 breached.

Furthermore, the launch of ETH 2.0 in December 2020, which seeks to transit the present proof-of-work (POW) consensus mechanism to a proof-of-stake (POS) platform, has driven more participants to the Ethereum network.

POS is seen as a game-changer because it is environmentally friendly and can tackle the high gas fees challenges.

It, however, remains to be seen how ETH plays out in the short term because market analyst Michael van de Poppe recently stated that Ethereum might experience a period of consolidation based on the formation of a crucial support level.

The Number of Bitcoin Addresses Holding At Least 1,000 BTC Hit a Monthly Low

Ever since China strengthened the supervision of cryptocurrency mining and related trading, causing “fear, uncertainty, and doubt” (FUD) sentiment that has intensified among investors, Bitcoin (BTC) has been on the receiving end as its price continues to drop.

The leading cryptocurrency was down by 20.48% in the last 7 days to hit $31,643 during intraday trading, according to CoinMarketCap.

The number of BTC addresses holding more than 1,000 Bitcoins also plummeted, as acknowledged by Glassnode. The on-chain metrics provider explained:

“The number of Bitcoin addresses holding 1k+ coins just reached a 1-month low of 2,152.”

The BTC mining crackdown happening in China has caused miners to sell their holdings to attain the needed capital to establish new facilities in other nations.

Market analyst Lark Davis noted:

“Chinese miners are being forced to either shut shop or move shop, the result has been that they are selling Bitcoin to both exit the market and recoup investments or to fund their move to greener pastures like Kazakhstan or Texas.”

Davis added that a lot of BTC mining machines were being switched off, which was detrimental in the short term but good in the long term.

A bear market is near?

According to CryptoQuant CEO Ki-Young Ju, the Bitcoin bear market might be confirmed by the fact that many whales are sending their holdings to crypto exchanges. He pointed out:

“I hate to say this, but it seems like the Bitcoin bear market confirmed. Too many whales are sending BTC to exchanges.”

Market analyst Michael van de Poppe also noted that Bitcoin needs to hold the current level to avoid a slump to the $24K area.

With leading American business intelligence firm MicroStrategy accumulating more Bitcoin holdings to a record-high of 105,085 BTC, it remains to be seen whether such actions by institutional investors will prompt the much-needed upward momentum in the Bitcoin market.

Bitcoin’s Sentiment on Twitter Remains Negative, Which Could Signal a Price Upswing

The consolidation period in the Bitcoin (BTC) market continued making a negative sentiment recently on Twitter, as acknowledged by Santiment.

The crypto analytic firm explained:

“Twitter’s sentiment toward Bitcoin remains negative in the amount of volume and tone that our algorithm is picking up. Generally, when there is negativity, there is a higher degree of a price upswing to catch the crowd off guard.”

Nevertheless, Santiment noted that this trend could trigger an upward momentum, leading to a market in surprise.

Bitcoin’s sentiment on Twitter being negative can be linked to the fact that short-term interest in the leading cryptocurrency declined by 43% after reaching an all-time high (ATH) in February.

Moreover, the number of addresses holding BTC for less than one month has dropped by 59% since February as volatility plummeted. Low volatility has engulfed the BTC market, and this phenomenon has partly been attributed to China’s intensified crackdown on crypto mining.

Bitcoin ‘millionaire tier’ of addresses continue going up

Yet, Santiment added that the BTC ‘millionaire tier’ of addresses holding between 100 and 10,000 Bitcoins keeps climbing. Precisely, their holdings have increased by 100,000 BTC since May 21.

On-chain analyst Will Clemente echoed these sentiments. He stated:

“Bitcoin whales have added +76,441 BTC to their holdings in the last 2 weeks.”

It, therefore, shows that the long-term investment perspective amongst Bitcoin whales remains strong.

Meanwhile, Jackson City, the eighth-biggest city in the US state of Tennessee, is looking at options for allowing its residents to pay property tax in Bitcoin. Moreover, the city’s employees are to be permitted to pay based on the dollar-cost average (DCA) in BTC.

DCA is an investment strategy in which an investor divides up the total amount to be invested across periodic purchases of a target asset to reduce the impact of volatility on the overall purchase.

Ethereum Whales’ Accumulation Mode Continues as Price Tops $3,200

Days after the London Hardfork went live, Ethereum (ETH) has been experiencing an uptick in prices as the second-largest cryptocurrency is set to become deflationary based on this upgrade.

ETH was up by 16.52% in the last seven days to hit $3,228 during intraday trading, according to CoinMarketCap.

Ethereum whales are not relenting in their accumulation quest because addresses with more than 100k coins now hold 43.7% of ETH supply, as acknowledged by Santiment. The on-chain metrics provider explained:

“Ethereum whale addresses aren’t stopping their accumulation as prices hover above $3,100. Three years ago to the day, addresses with 100k+ ETH owned 35.8%. Today, they own 7.9% more of the second market cap asset’s total supply. There are 1,338 of such addresses.”

These statistics show that Ethereum whales’ accumulation has been on an upward trajectory because they owned 35.8% of ETH supply three years ago compared to the current 43.7%.

Is Ethereum eyeing the $4,000 level?

According to market analyst Ali Martinez:

“The IOMAP shows that Ethereum could run to $4,000 if ETH manages to close above $3,235. A rejection from this supply barrier could lead to a spike in selling pressure that pushes ETH to $2,700.”

Martinez believes that a run to the $4,000 level is relatively open because Ethereum currently stands at the zone, which it has to break for more upward momentum to be attained.

On the other hand, Ethereum options open interest recently surged to a two-month high.

ETH was recently boosted after the London Hardfork or EIP 1559 was implemented because a base fee for every transaction carried out will be set. As a result, giving all a fair opportunity.

Furthermore, users who may wish to conduct their transactions faster than the standard provisions of the network can add a tip to validators to fast-track their transactions. Part of this tip is burnt, helping to improve the monetary policy of the Ethereum network as a whole and making it deflationary.

With ETH options open interest topping $4 billion, whether this will boost Ethereum’s journey to the $4,000 level remains evident.