Coinbase Commerce will discontinue support for BTC and similar UTXO coins, shoppers will need Coinbase account to use BTC for payments.
As of 21, July 2020, Bitcoin “active entities”, or simply users- rose to a colossal 305,355. An amount of interaction that hasn’t been seen since December of 2017, marking the height of the Bitcoin Boom. However, during that time, those December heights of 2017 marked a prolonged bear market, which although recovery was secured, the historically volatile price movements of bitcoin had all but stopped. Pegging itself back at the pre-February 2020 market shakeout value of just around 9k, a price that Bitcoin had been harboring comfortably since September 2019.
Known for exciting price volatility and subsequent gains opportunity, seeing the market go all but comatose had many seasoned investors intrigued, firming the predictions that Bitcoin could reasonably function as a crypto-equivalent to gold. Perhaps it was this newfound crypto-hedge buy-in that had fresh investors flocking to platforms like Bitvavo, exchanges designed to help traders navigate the marketplace. Perhaps it was the advent of such exchanges in itself.
Growing Interest and Concern
Following somewhat sinister and unsubstantiated detractors, hushed whispers of ominous whale movement in late June of this year seemed to put many investors off of the market- with these supposed pundits predicting yet another complete market crash, as whales hurried to dump their holdings.
While movements did occur, the small trade oscillations to follow these “solid tips” did little to affect the price of the coin. Instead, the opposite seemed to happen, as new users flocked to the market, driving up active entity participation to the levels we see this month, rising above the average by 14%. Leaving common critics holding doomsday predictions in out-turned pockets.
Despite the surge in users, transaction network activity and price point had yet to budge as of late July, remaining stagnant for a four week period. A type of stability that is rarely seen in the bitcoin marketplace. That is, until July 27, when from seemingly nowhere a flurry of market activity drove the price past 11k. A value not seen since August of 2019. The price perk had many teetering between excited and wary, fearing that bitcoin was up to its old tricks of enamouring quick turn investors by providing a number of enticing valleys and peaks.
Price Spike in a Slumbering Market
The price of Bitcoin brushed $11,000 USD on Monday, to which speculators had several theories regarding what could be behind the unexpected tailwind. Most believe that this newest price high, a value not seen or sustained since 2017, has to do with a renewed and aggressive interest in DeFi markets. Decentralized Finance (DeFi) is the latest investment craze to hit the crypto sphere. A type of crypto driven financial system that mimics traditional structures on the notion of decentralization.
Suspecting that investors in DeFi and altcoins- which have also seen a bump in interest- are pumping gains into Bitcoin and Ethereum, the two most popular cryptocurrencies in existence. Using them as a passive gains hedge to other, riskier investments. Which in turn, has driven up the price of both. As Ethereum prices jumped by nearly a third in the last month.
New legislation may also be providing a bit of an updraft, as the U.S. Office of Comptroller of the Currency put out a letter that now allows for banks to become custodians of cryptocurrencies for their customers. Further blurring the line between centralized banking and DeFi. There’s also speculation that recent interest and price jumps in the sector come from a growing distrust and concern in traditional financial and governmental structure.
What This Means for Bitcoin
Speculators seem torn as to whether recent spikes in interest will be enduring. Citing multiple probably factors for the increase. Although positive sentiment prevails. Many seem to believe that whether or not the market continues on with the bull run we’re now seeing, or goes back to its torpid state of 9k nebula, another market shakeout or prolonged and devastating bear performance is unlikely.
Some go as far as to suggest that Bitcoin has finally broken its initial resistance band of $10,500 USD and could reasonably be expected towards its next of $13,800. Pointing towards “wave theory” a type of crypto-favourite oscillator that gained massive traction in 2017. Which pulls credence from the noticeable increase in both active entities and renewed excitement revolving crypto finance and blockchain technologies.