1. Market Wrap: Ether Outperforms Bitcoin as Traders Look to Altcoins
Analysts see strong fundamentals for alternative cryptocurrencies.
Cryptocurrencies were mostly higher on Thursday as some traders appear to be rotating into tokens that have underperformed over the past month. Bitcoin was roughly flat over the past 24 hours, compared with a 7% jump for ether over the same period.
“Direction-wise for BTC, we find ourselves with a bullish bias but unable to form a strong bullish conviction in spite of the clear optimism in the market,” crypto trading firm QCP Capital wrote in an announcement on Telegram.
Despite BTC’s recent outperformance, QCP mentioned that it is “extremely excited” about the new growth phase in the decentralized finance (DeFi) market. The firm maintains long positions in tokens such as Algorand’s ALGO and Solana’s SOL relative to its neutral BTC position.
Latest Prices
Bitcoin (BTC), $57,730, +1.2%
Ether (ETH), $3,788, +7.7%
S&P 500: +1.7%
Gold: $1,799, +0.3%
10-year Treasury yield closed at 1.518%
Ether underperformance narrows
Ether, the second-largest cryptocurrency by market capitalization, is holding price support above $3,500, and its underperformance versus BTC over the past month appears to be narrowing as some investors look toward improving fundamentals in alternative cryptocurrencies.
FundStrat, a global advisory firm reiterated its bullish stance on ether in a newsletter published on Wednesday. “We remain comfortable in the perceived tailwinds that the leading smart contract platform is set to benefit from and expect rotations into ETH to follow any sizable run-up in a bitcoin-dominated market,” the firm wrote.
From a technical perspective, the chart below shows the ETH/BTC ratio rising from the 200-day moving average for the first time since April, which preceded a period of strong outperformance. The ratio broke above a short-term downtrend in August and could see further upside toward 0.07 over the short term.
2. Bitcoin Climbs Above $60K After Report that SEC Won’t Block Futures ETF
The key cryptocurrency’s price touched $60,300 Friday.
Bitcoin jumped above $60,000 for the first time in almost six months following a report that a bitcoin futures exchange-traded fund (ETF) will clear the U.S. Securities and Exchange Commission (SEC).
As of press time the largest cryptocurrency was changing hands around $59,900, after touching $60,300 earlier Friday.
The SEC is reviewing around 40 bitcoin ETF filings with multiple decision deadlines on futures-linked products hitting next week. According to Bloomberg, the regulator is expected to approve at least some of them, clearing the way for trading to begin.
The SEC does not need to take any formal action to approve the filings. Under federal law, applications can become effective if the SEC allows a mandated deadline to pass by without requesting changes or directing the aspiring issuer to pull the filing.
Bloomberg named applications by ProShares and Invesco as two proposals that may be allowed to launch under this law next week.
3. Ransomware Payments in 2021 Already Dwarf Last Year’s Total, FinCEN Reports
FinCEN identified over $5 billion in transactions tied to ransomware payments based on $590 million detailed in Suspicious Activity Reports.
Payments tied to ransomware attacks in 2021 are already exceeding 2020′s total, the U.S. government’s financial crimes watchdog announced Friday.
Exchanges and other financial institutions reported more than $590 million in payments tied to ransomware attacks, including cryptocurrency payments, to the Financial Crimes Enforcement Network (FinCEN) in the first half of 2021, outstripping a 2020 total of just $416 million. It was not immediately clear what amount of this total was comprised specifically of cryptocurrency transactions, versus more traditional payment methods.
A Treasury Department press release said attackers are “increasingly requesting payments in Anonymity-Enhanced Cryptocurrencies such as Monero.”
Attackers are also using mixers, decentralized exchanges, fresh wallet addresses and hopping between chains more as an effort to evade law enforcement officials, the release said.
FinCEN tied the reported amounts, which came through Suspicious Activity Reports (SARs), to a total of $5.2 billion in transactions that may be “potentially tied” to ransomware payments, according to Treasury Department official Todd Conklin.”
Last year, former FinCEN Director Kenneth Blanco told that less than 1% of SARs filed to the agency mentioned crypto, though he did not share any monetary figures tied to these reports.
Conklin, counselor to Deputy Treasury Secretary Adewale Adeyemo, told TRM Labs’ Ari Redbord that the announcement is part of the Treasury Department’s broader push against ransomware. Ransomware, where an attacker encrypts a victim’s computer or network until the victim pays a ransom for a decryption key, has been employed in several high-profile attacks in 2021, disrupting critical supply-chain vendors like a gas transport firm and a meat processing plant.
4. Ether, Bitcoin to Strengthen in Coming Weeks, FSInsight Says
The firm’s first upside target for bitcoin is close to $61,000 and then the highs from earlier this year of around $64,860.
Ether is beginning to gain on bitcoin following a month of underperformance, and Thursday’s surge to multi-week highs suggests a retest of the September top at $4,027, according to a report published Oct. 14. by FSInsight, a markets strategy and research firm.
Ether is “showing evidence of starting to gain ground in market cap given the breakout in its market-cap dominance chart,” the report says.
FSInsight says both ether and bitcoin should continue to strengthen in coming weeks and “technically it looks right to own both near-term.”
An ether breakout above $4,027 should “not face much resistance at $4,410, but likely surpass this and rally to targets near $4,951, or targets above lie near $5,826,” and “it’s anticipated that September highs should be exceeded, giving way to acceleration back to new all-time highs,” the FSInsight report says.
The firm’s first upside target for bitcoin is close to $61,000 and then the highs from earlier this year of around $64,860.
FSInsight had previously argued that the gains in crypto markets seen on Oct. 1 may be technically significant.
Bitcoin was trading at about $59,360 and ether at $3,778 as of publication time.
5. Bank of Japan Seeks ‘Plain, Easy-to-Cook’ CBDC Model
An executive director has stressed that the BoJ has “no plans to issue a CBDC at this time,.
The Bank of Japan (BoJ) would try to develop a central bank digital currency (CBDC) that can easily coexist with private payment methods, Executive Director Shinichi Uchida said in a speech.
Seeking “vertical coexistence,” with other payment methods used by the public, a CBDC should be made of “relatively plan, easy-to-cook material,” Shinichi Uchida said on Friday.
The central bank official cited an example in which a CBDC could be used within a digital wallet provided by a private company.
“There are various options, but the Bank of Japan would like to work with you to draw an overall picture of the payment system when the CBDC exists,” he said.
The director said the priority of the central bank is that the addition of a CBDC should enable competition between private payment systems providers, while also being universally accessible by the public.
This position was also stressed in a statement, which was released on Wednesday, by the finance officials of the G7.
Uchida added in his speech that the BoJ has “no plans to issue a CBDC at this time,” but that not issuing one would still leave the central bank with the task of building a payment system fit for the future.
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