Weekly Roundup: BTC at 3-Week Low, Alt Markets Follow, Bytecoin an Exception
In this week’s edition, we examine some of the reasons why BTC can’t seem to climb back above the $10,000 mark, why its still the leading indicator of investor sentiment in the crypto markets, and muse over what little it takes for a second-tier alt to shoot up over 30% in the face of a market downtrend.
BTC Fails to Hold Gains, Altcoins Follow Suit
The price of bitcoin ended the week with a 10% loss, falling to a three week low and sinking to $8400 as of Monday morning, once again retracting gains that have been slow to accrue in 2018. Though BTC is still up considerably from its 2018 low of $6200, set in early February, it has not managed to climb above the psychologically-crucial $10k mark since March. Suspected reasons for bitcoin’s relatively stagnant price movement include the following:
- Efforts by federal governments worldwide to regulate its availability or usage, which curb its libertarian appeal of an independent, anonymous form of currency
- A growing list of competitors that offer enhanced versions of bitcoin’s features, based on new developments in the computer science surrounding blockchain technology
- Bitcoin’s continued association with negative human behavior, such as greed and a wide variety of criminal activity, ranging from simple money laundering, to pyramid and Ponzi schemes, to darknet contract killings.
Regardless of pressures brought on by newer cryptocurrency alternatives and a fear of falling out of popularity with investors, bitcoin still leads the pack of all other coins; the clear majority of which continue to mimic its price movement behavior (i.e. when BTC goes up, most altcoins go up, and when BTC goes down, most altcoins go down). This phenomenon is easily confirmable by taking a quick glance at the 7-day price charts for the top alts, which tend to mirror the 7-day chart for bitcoin, unless some coin-specific news is driving a particular coin up or downwards:
Last week’s price chart for BTC, generally experienced by most altcoins, can be characterized by a wavering high dominating the first half, followed by a sharp midweek drop (most coins fell at this point within minutes or hours of each other), followed by a slow climb back upwards, finishing with last night’s substantial decline. To make a long story short: the health of investor appetite for bitcoin remains the number one indicator of the health of most other coins, and the cryptocurrency market as a whole.
Coins Bucking the Trend: Bytecoin
An example of a coin untethered to the price of BTC last week was Bytecoin (BCN), which soared upwards of 32% over the week, and 26% against BTC in the last 24 hours alone. Bytecoin, an original take on the idea of the blockchain, was built from the ground up and based on CryptoNote technology, designed to offer an enhanced layer of privacy by obscuring sender addresses during the transaction process. Since Bytecoin was first released to the public in March 2014, more than 20 CryptoNote coins have followed suit, including the darknet market fave Monero (XMR), which currently sits five spots above BCN in the ranking by coin market capitalization.
So, what is contributing to Bytecoin’s upward trajectory in the face of heavy market downwinds, or stagnant air at best? The number one driver of BCN’s momentum is its recent listing on the world’s biggest coin exchange by volume: Binance. Last week, Binance decided to not only add the long-standing cryptocurrency but offer three pairings: BTC/BCN, ETH/BCN and BNB/BCN. At a price of $0.01 per coin, BCN is still down some 45% from all-time highs set earlier in the year, but there is little doubt that the Binance boost will have some long-term positive effects for CryptoNote’s original coin. Binance’s ease of use and worldwide access will provide an opportunity for those who have known about Bytecoin but unable to purchase it for whatever reason, increasing its liquidity and breathing new life into the four-year-old cryptocurrency (an age that is relatively ancient by today’s standards).
We wish there was more news to explain Bytecoin’s sudden rise in price, but the fact is, sometimes being added to the world’s biggest cryptocurrency exchange is all that is takes for a coin to experience some massive gains. A piece of evidence that points to Binance as being the sole factor in BCN’s climb is the fact that these gains were not seen in other exchanges where BCN is heavily traded, such as Poloniex and OKEx. Interestingly, the full potential of this latest “pump” of Bytecoin was probably dampened by some negative news, in that the team behind an “app store” for the popular Linux-based operating system Ubuntu disclosed that there was some mining malware hidden in one of its popular apps, and that the coin being mined was Bytecoin.
Also in the News
- A series of bitcoin conferences hosted by the well-established crypto news source CoinDesk is raking in millions of dollars in ticket sales, despite being boycotted by Ethereum founder Vitalik Buterin because they are “too expensive.”
- All the negative press surrounding bitcoin shouldn’t blind people to the reality of the ways in which blockchain technology has the power to transform society for the better, including the provision of a solution in keeping corrupt governments honest, reminds an article in U.K.’s widely-read The Guardian.
- American venture capital investor and Wall Street media figure Tim Draper had some pretty anti-Warren Buffett words to say about bitcoin, declaring it not only a good investment but “the most secure place to put your money.” We can only assume he means this if you are putting it in a paper wallet from an open source paper wallet generator, for which the keys were generated offline – and you are storing it someplace you feel is absolutely secure.
- In another cluelessly ironic crypto moment to come from the insulated, overpaid robber barons at Wall Street,Goldman Sachs announced that it planned to lead the way in helping institutional investors make cryptocurrency investments, despite CEO Lloyd Blankfein’s comment last year that he did not consider bitcoin, the mother of all cryptocurrencies, to be a “store of value.” We must wonder, as a basic instinct, why anybody would continue to trust this man or place a single cent in any investment which he ultimately oversaw in his capacity as Goldman Sachs CEO.