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Crypto Trader Market Analysis and News – Update on India Ban

By July 13, 2018 March 27th, 2019 No Comments

Cryptocurrency Market 7-day recap

For this week’s crypto trader update, we noticed a healthy rise in the cryptocurrency market, something we have not seen in quite some time. The week started at ~$246 billion and has finished at around $272 billion, an increase of almost $26 billion or around 10.5%.

Not in the mood for reading? Here’s our video for this post!

Trading volumes are looking even healthier, with the week starting around $10.3 billion and finishing higher at $14.7 billion.

Image depicting recent cryptocurrency volumes as part of crypto trader market analysis

Figure – Coin market cap

Market Dominance

Bitcoin dominance over the past 7 days has stifled slightly. At the beginning of the week saw 42.56% and we finished at 41.69%.

Image depicting Bitcoin market dominance during this period as part of this crypto trader market analysis

Figure – Coin market cap

Google Trends searches for BitcoinEthereumRipple, and cryptocurrency this past week showed some spikes early on and towards the middle of the week. These movements show a fair correlation to the pumps that occurred on June 3rd and 31st. Overall, this is nothing out of the ordinary. Oftentimes, as search volume spikes, they correlate with peaks and troughs in market cap.

Image depiciting recent Google Trends searches for cryptocurrency terms as part of a crypto trader market analysis

Figure – Google trends

Technical Analysis

This week we had some more expert commentary from Rabbi Ahmed, Head of Trading at Bit Trade Australia.

Rabbi’s analysis of the market indicates that July will be the low for Bitcoin, and that the price should rally for 3 months. In regards to the low, Rabbi says:

“The low has either formed already, or one last shakeout to USD $5K to stop longs out before accumulating.”

and that:

“[The] fundamental catalyst for a strong bull run will be an introduction of an ETF. Coinbase and other large exchanges are building infrastructure to cater to the institutional clients.”

Rabbi concludes with sentiments that if one were to accumulate Bitcoin, then the July low marks an appropriate entry point.

Crypto Trader News

Will India Reverse Bank Ban on Cryptocurrencies?

In an article from Quartz, we saw indications that India will not be blanket-banning cryptocurrencies. In fact, the digital assets may gain a ‘commodities’ classification.’ This would give greater regulatory powers to the Indian Government.

The Initial Ban

Back in early April of 2018, the Reserve Bank of India (RBI) banned any regulated entities from dealing with cryptocurrencies. In essence, the RBI placed an immediate ban on any bank or financial institution from dealing with cryptocurrencies. Their statement read:

“…it has been decided that, with immediate effect, entities regulated by RBI shall not deal with or provide services to any individual or business entities dealing with or settling VCs. Regulated entities which already provide such services shall exit the relationship within a specified time. A circular in this regard is being issued separately.”

Given the RBI regulates most if not all national and state banks in India, this ban has had a wide-reaching effect. It’s important to note that this ban focused on companies and businesses that were accepting cryptocurrency as payment, and then disposing or liquidating them into a bank account. So, actually, the ban did not cover cryptocurrencies themselves. In effect, peer-2-peer trade was still okay.

At the time of the ban, the crypto trader market reacted with a loss of around $26 billion USD ( -9.2%).

Image of graph showing India's market response to government ban as part of this crypto trader market analysis

Source: Coinmarketcap.com

The loss was not huge considering the frequent volatility the crypto market endures. This is likely due to the fact that India is not high on the list in terms of trading volume. The two biggest exchanges prior to the ban were ZebPay and Koinex. In fact, they ranked 43 and 44 in terms of global trading volumes.

However, the effect was likely not as great considering the market cap had already corrected by around 70% since December. Sentiment was and still is very poor. Many of the early market participants have left, with the majority remaining being long-term investors.

Cryptocurrencies to Become Commodities

In the piece from Quartz, a senior government official who had access to a special cryptocurrency panel said the following:

“I don’t think anyone is really thinking of banning it (cryptocurrency) altogether. The issue here is about regulating the trade and we need to know where the money is coming from. Allowing it as (a) commodity may let us better regulate trade and so that is being looked at.”

So what does it mean by classifying cryptocurrency as a commodity? According to Investopedia, a commodity is defined as:

“A basic good used in commerce that is interchangeable with other commodities of the same time.”

Examples of common commodities are gold, silver, oil, sugar, coffee etc.

What Classifies a Commodity for Crypto Traders?

Classification differences between something being a ‘commodity’ and a ‘currency’ can have significant differences in terms of regulation and tax. The former deputy of the RBI, R Ghandhi, had this to say about it:

“Treating them as commodities will also make it clear to some investors that cryptocurrencies like Bitcoin aren’t real currency.”

Here’s where the real complications begin. Because cryptocurrencies are just that. A currency that is cryptographically secure using decentralised forms of consensus. But as we know, cryptocurrencies are also a store a value. Bitcoin is a perfect example of this.

Some cryptocurrencies by nature are intended to be more ‘commodity’ based, with protocol coins like Ethereum and NEO being good examples.

Here is where a ‘one size fits all’ approach does not seem like the way to go. From using the Howey Test (a near 100-year-old form of assessing whether something is a security or not) to applying a ‘commodity’ definition to all cryptocurrencies, it’s clear a new asset class needs clear defining.

Essentially, cryptocurrencies represent a paradigm shift in money – information sharing, technology, cryptography, consensus, and transparent ledgers. Crypto traders need a new system and a new set of frameworks to properly appreciate the change in old world to new, that is cryptocurrency.

OmiseGo (OMG) Partners with Status

In a recent Medium post, Status officially announced a partnership with OmiseGo.

image of Omisego and status logo as part of crypto trader market analysis

Status is an operating system that is built on the Ethereum blockchain and is designed for mobile devices. Any mobile device running the Status OS becomes a light client node on the Ethereum network. One of its main features is a private messenger that also allows for the exchange of cryptocurrency payments. Smart contracts can also be deployed between users within a chat, with all communications being encrypted and fully decentralised.

OmiseGo is a subsidiary project from Omise, which is a payment gateway company operating primarily in countries across Asia. OmiseGo is building a decentralised financial services network, with its aim being to ‘unbank the banked’. One of OmiseGo’s major projects is research and development of ‘Plasma‘, which is a layer-2 scaling solution for Ethereum. Plasma will be based on a ‘Proof of Stake’ consensus algorithm, with features such as a decentralised exchange, infinite scalability and settlement for financial applications.

Benefits of an OmiseGo – Status Partnership

The partnership marks a strong relationship between two very well established cryptocurrency projects. Status is ranked #52 by market cap with its token ‘SNT’. The current market cap is $311 million AUD. OmiseGo is currently ranked #20 with its token ‘OMG’, and has a total market cap of $1.29 billion AUD.

The value exchange of the partnership indicates Status will be using OmiseGo’s Plasma-based decentralised exchange. The exchange will integrate into the Status operating system, allowing seamless token swaps from a mobile app.

Jun Hasegawa, Founder & CEO of OmiseGo had this to say about the partnership;

“The mission of OMG is to put the capabilities of crypto to work for the needs of the real world; Status brings great value to the OMG Network with a multifaceted user-facing platform leveraging OMG’s back-end infrastructure. This partnership is a step forward for our respective projects, the community and the blockchain industry.”

OmiseGo’s Plasma research has been underway since August 2017, marking a big step forward for the OMG team. According to the partnership post, the initial release of the decentralised exchange component is nearing release. Features of the DEX include blockchain to blockchain interoperability, cross chain transactions, and transactions with digital fiat platforms.

Conferences

The Hybrid Summit 2018 is a blockchain conference happening in Bangkok Thailand from the 28th to the 29th of July. Some significant industry veterans will be speaking, including Fundstrats Tom Lee, the man behind the Bitcoin Misery Index.  Also speaking will be Reeve Collins, Co-founder of Tether, Jane Lippencott, Co-founder of ZenCash, and Miko Matsumura, Venture Partner of Bitbull.

If you are interested in attending, our readers can get a special 50% discount on ticket prices by using ‘CRYPTOAUST’ discount code.

Check out more at the official website, Hybrid Summit 2018

Disclaimer: This information should not be interpreted as an endorsement of cryptocurrency or any specific provider, service or offering. It is not a recommendation to trade. Cryptocurrencies are speculative, complex and involve significant risks – they are highly volatile and sensitive to secondary activity. Thus, Performance is unpredictable and past performance is no guarantee of future performance. As a crypto trader you must consider your own circumstances, and obtain your own advice, before relying on this information. Yohttps://cryptocurrencyaus.com/crypto-news-weekly-5/ should also verify the nature of any product or service (including its legal status and relevant regulatory requirements) and consult the relevant Regulators’ websites before making any decision. Cryptocurrency Australia Media, or the author, may have holdings in the cryptocurrencies discussed. Referrals and affiliate links do earn us commissions but they are products or services we personally use and would not endorse if we did not believe in them.

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