Market Wrap: The ‘Elon Effect’ Blasts Bitcoin to $44.8K While Ether Moons


Bitcoin’s price is approaching Mars thanks to Elon Musk, while ether hits a new record. Investors are pulling BTC out of DeFi to diversify their profits.

  • Bitcoin (BTC) is trading around $ 44,023 as of 9:00 PM UTC (4:00 PM ET). Climbing 14.5% in the last 24 hours.
  • Bitcoin 24-hour range: $ 38,051 – $ 44,801 (CoinDesk 20)
  • BTC well above the 10-hour and 50-hour moving averages on the hourly chart, a bullish signal for market technicians.

Bitcoin trading on Bitstamp since February 5th.

Source: TradingView

Bitcoin’s price hit a record price on Monday, rising to $ 44,801 at around 1:00 PM UTC (8:00 AM ET). According to CoinDesk 20 data, it’s been a month since the previous record of $ 41,375 was hit.

The historical price of Bitcoin over the past month.

Source: CoinDesk 20

A catalyst for the price increase: The Tesla (TSLA) of the entrepreneur Elon Musk has invested 1.5 billion US dollars in the cryptocurrency. The company also said it would accept bitcoin for goods and services.

Continue reading: Tesla is investing $ 1.5 billion in Bitcoin and plans to accept crypto payments

“All bets are off the table now. I was worried about that [at] At around $ 35,000 to $ 40,000, we didn’t see large institutional flows and the market was pretty weak over the weekend, ”noted Chris Thomas, Head of Digital Assets at. Swissquote Bank. “But Tesla would have bought a little every day for the past few weeks.”

Since the beginning of 2021, the Bitcoin spot exchange volume recorded by CoinDesk 20 on eight major exchanges has been above the half-year average.

So far this year, the average daily trading on these exchanges has been $ 4.4 billion. As of August 8, 2020, the daily average has been $ 1.7 billion. At more than $ 6.7 billion at the time of going to press on Monday, the volume is also above the 2021 average.

Major spot bitcoin volumes from exchanges in the past six months. (Shuai Hao)

Source: CoinDesk Research

“Bitcoin is at a new high in ‘frenzied’ buying today and clearing minor resistance as of January,” said Katie Stockton, technical analyst at Fairlead Strategies. Stockton also noted that Bitcoin has lost steam since its musk-motivated rally to $ 44,023 at press time. “Signs of exhaustion are associated with today’s steep rally from an overbought / oversold perspective,” she said.

However, the trend remains bullish, Stockton added. “Despite the potential for additional short-term volatility, the long-term uptrend appears healthy from a dynamic behind Bitcoin perspective.”

While some are skeptical about the increase in Bitcoin’s 30-day volatility over the past three months, other types of traders are certainly excited about it.

30-day bitcoin volatility over the past three months. (Shuai Hao)

Source: CoinDesk Research

“Tesla’s purchase of Bitcoin was a largely predictable move given the support of CEO Elon Musk,” said Guy Hirsch, US managing director at eToro.

Continue reading: Ex-OCC boss Brooks calls Tesla’s Bitcoin Buy a bit “scary” for the rest of the world

“If more companies make similar announcements, $ 50,000 could possibly be within reach in the next few months,” added Hirsch.

“We think we’re just scratching the surface when it comes to corporate and institutional participation in the world of bitcoin and cryptocurrencies,” Joel Kruger, cryptocurrency strategist at LMAX Digital, told CoinDesk. “We suspect that moves by visionaries like Tesla will only serve to reinforce the tremendous value proposition that decentralized assets offer.”

Ether on a new level as BTC investors withdraw from the Ethereum protocol

Meanwhile, Ether (ETH) is also reaching records and the asset’s correlation with Bitcoin has fallen back to a level not seen since December.

90-day correlation between Bitcoin and ether over the past six months (Shuai Hao / CoinDesk Research)

Source: CoinDesk indices

The second largest cryptocurrency by market cap rose $ 1,720 on Monday and rose 8.5% in a 24 hour period at 9:00 p.m. UTC (4:00 p.m. ET). The price hit a new all-time high on Monday and hit $ 1,776, according to CoinDesk 20 data.

Continue reading: Ethereum futures are now traded on CME

According to data aggregator DeFi Pulse, the amount of Bitcoin held in DeFi (Ethereum Based Decentral Finance) fell by almost 3.5% from over 50,000 to 48,344 BTC on Monday.

Bitcoin has committed itself to decentralized finance for the past three months.

Source: DeFi Pulse

Swissquote’s Thomas notes that Monday could be a day for bigger players to start moving bitcoin as a new bitcoin price spike could encourage some investors to diversify their profits.

“Bigger hedge funds, etc. [that] Of course, if you got into Bitcoin between $ 15,000 and $ 20,000, you’d want to take profits between $ 45,000 and $ 50,000 for a profit of 2.5-3x. “I’ve always seen that as a difficult challenge,” Thomas told CoinDesk.

Other markets

The digital assets of CoinDesk 20 are all on Green Monday. Notable Winners as of 9:00 PM UTC (4:00 PM ET):

  • Oil rose 1.9%. Price per barrel of West Texas Intermediate Crude: $ 58.03.
  • Gold was in the green at 0.95% and at $ 1,830 at press time.
  • Silver gains 1.9% and changes hands at $ 27.32.
  • The 10-year US Treasury yield rose to 1.169 on Monday and was in the green by 0.15%.

The CoinDesk 20: The assets that matter most to the market