Bitcoin Rises Above $37,000 Despite Binance News

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Bitcoin and numerous major altcoins fell dramatically on November 21 as a result of the Binance news, but have since found support at lower levels. This shows that traders bought at lower levels after the initial knee-jerk reaction. Buying on falls and selling on rallies leads in range-bound trading as the bulls and bears compete for power. The turnaround in market mood could be related to the Binance matter being resolved through a settlement, as well as the market realising that, unlike FTX, Binance did not face a substantial outflow of funds when its liquidity issues first became public.

Fundamental Updates

Let’s delve into the significant developments shaping the crypto market landscape:

  • KyberSwap loses $47 million in potential exploit: KyberSwap, a decentralised exchange protocol, may have been compromised for $47 million, according to data on-chain. The funds originated from its liquidity solution, Elastic Pools. The funds are comprised of the following: $15 million on Optimism, $20.7 million on Arbitrum, $7 million on Ethereum, $3 million on Polygon, and $2 million on Base. A significant proportion of the funds are denominated in diverse ether forms, including liquid staking tokens, wrapped tokens, arbitrum (ARB) tokens, and numerous stablecoins.
  • Mt. Gox will repay creditors in cash shortly: Mt. Gox intends to initiate “immediate” cash repayments to a subset of creditors, according to an email received by creditors. The email from the defunct bitcoin exchange, which ceased operations in 2014, stated that the rehabilitation trustee is working diligently to initiate cash repayments by the 2023 calendar year. Notwithstanding this, repayments are anticipated to continue into 2024 due to the substantial quantity of rehabilitation creditors. Rehabilitation Trustee Nobuaki Kobayashi stated in an email, Because the precise timing of repayment to individual rehabilitation creditors is unknown, it will be impossible to provide advance notice to each rehabilitation creditor regarding the precise timing of their repayment.

Key Data Points

Crypto market key data points
  • Total market capitalization: The total market capitalization of the crypto market is currently around $1.47 trillion. This is a net $20 Billion change from last week.
  • Bitcoin dominance: Bitcoin dominance, which tracks the percentage of the total market capitalization that is held by Bitcoin, is currently at around 49.5%. This is 0.81% up from last week.
  • ETH dominance: ETH dominance, which tracks the percentage of the total market capitalization that is held by Ethereum, is currently at around 16.8%. This is 0.59% up from last week.

Bitcoin Price Analysis:

The bears dragged Bitcoin below $35,800 but were unable to maintain the lower levels. Bullish buying has lifted the price back above $37,000. For several days, the BTC/USDT pair has been stabilising between $35,800 and $38,000. This suggests that supply and demand are in balance. If the price rises above $38,000, the pair might begin the second leg of its climb to $40,000. This level could provide formidable opposition. 

On the other hand, if the price falls and falls below $35,800, it indicates that traders are fleeing. This might pave the way for a further drop to $33,500. Concerns about US legal action against the largest exchange, Binance, triggered a wave of long liquidations, but the rebound was equally impressive. A popular story recently featured a prospective US approval for a Bitcoin spot price exchange-traded fund (ETF).

Bitcoin price analysis

BTC Technical Indicator:

BTC Indicators

Macro Updates:

  • The US labour market is stalling as interest rates rise and economic demand falls, as weekly jobless claims have fallen more than expected.
  • Both initial and continuing unemployment claims dropped, suggesting seasonal adjustment issues. In spite of this downturn, the labour market is strong enough to dissuade Federal Reserve rate hikes but not poor enough to consider cuts.  
  •  Due to conflicting inflation expectation surveys and solid, but declining, labour market data, cautious expectations of a rate cut by 2024 reflect this slowdown.

Bitcoin returns were 0.6% for this week. The Alpha Blue Chip Focused Strategy returns were −21.75% during the same period (16 November -22 November). The Top Cap Digital Assets Strategy and Arbitrage Opportunities & Balanced Strategy returns were -10.56% and −5.61%, respectively.

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