Market Wrap: Bitcoin fails to hit $ 16.5,00zero; Boxed BTC hits $ 2 billion

Analysts are bullish on Bitcoin price, but the options market is decidedly bearish for the remaining weeks of 2020. Ethereum's wrapped bitcoin token exceeds $ 2 billion.

  • Bitcoin (BTC) starts trading at $ 16,240 as of 9:00 PM UTC (4:00 PM ET). Profit of 0.30% in the last 24 hours.
  • Bitcoin's 24-hour range: $ 15,971 to $ 16,487
  • BTC above its 10-day and 50-day moving averages, a bullish signal for market technicians.

Bitcoin trading on Bitstamp since November 11th.

Source: TradingView

The price of Bitcoin rose for the third year in a row to as high as $ 16,487, according to CoinDesk 20. It has fallen slightly since hitting that level, trading at $ 16,240 at press time.

“Bitcoin rose well above the $ 16,100 mark. The buyers have pushed the price down due to the large volume, ”said Constantin Kogan, managing partner of the investment company Wave Financial.

The major exchanges' daily spot volume on Friday was $ 668 million as of press time, but nowhere near $ 1.1 billion on Thursday.


Major USD / BTC spot volumes last month.

Source: Shuai Hao / CoinDesk Research

George McDonaugh, managing director of investment firm KR1, highlighted a key difference between the price hike in 2020 and the moon in 2017. "Bitcoin has spent 0.32% of its life on $ 16,000 and up, which means there were relatively many in 2017, there were very few buyers at this level," he told CoinDesk. "This correlates with very few sellers at this level right now, which means there isn't a strong band of resistance for the bulls to push the price up."


Weekly Bitcoin spot trading on Bitstamp since 2013.

Source: TradingView

"I see increasing demand from more traditional family offices making their first investments in Bitcoin as long-term protection or as insurance for their existing investment portfolio," Michael Gord, CEO of Global Digital Assets, told CoinDesk. "I expect this trend to continue as Bitcoin holds its value and does not correlate with most other asset classes."

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Bitcoin isn't entirely uncorrelated with other asset classes like stocks, but recently the correlation between the world's oldest cryptocurrency and the S&P 500 has decreased somewhat.


Bitcoin's 90-day correlation with the S&P 500 in 2020.

Source: Shuai Hao / CoinDesk Research

KR1's McDonaugh expects Bitcoin price to hit $ 20,000, but it could take some time to get there as profit-taking is likely to follow. "$ 20,000 is a far more psychological barrier, so it's likely" HODLers "- people who hold Bitcoin forever – that can reduce risk at this level and create some selling pressure," he said.

Bitcoin options traders are not entirely convinced that they will trade at $ 20,000 in 2020. According to the data aggregator Skew, the probabilities calculated at the end of December only set a 16% chance of USD 20,000 Bitcoin, 29% for USD 18,000 and 39% of USD 17,000.


Probability of Bitcoin prices to expire in December based on the options market.

Source: Skew

Still, analysts predict that Bitcoin could soon surpass at least $ 16,500 continuously. "I am still optimistic about BTC, given market sentiment and current trends," said Andrew Tu, a senior executive at trading firm Efficient Frontier. "Although we might be a little between $ 16,000 and $ 16,500 before we break the resistance."

Wrapped bitcoin hits $ 2 billion

Ether (ETH), the second largest cryptocurrency by market capitalization, gained on Friday, trading around $ 470 and rising 2.00% in 24 hours from 9:00 PM UTC (4:00 PM ET).

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The amount of Bitcoin "locked" in the Ethereum-based Bitcoin contract exceeded $ 2 billion on Thursday and will remain at that level on Friday. In order to use Bitcoin in Ethereum, it has to be "packaged" with a standard called ERC-20 and used as a token on the network.


Blocked total value for wrapped Bitcoin or WBTC in the last three months.

Source: DeFi Pulse

Brian Mosoff, CEO of investment firm Ether Capital, says parking Bitcoin on Ethereum gives the network a huge head start over its emerging smart contract competitors, including Polkadot, Cardano and Cosmos.

"It proves that Ethereum is what everyone is joining in and (networks like) Polkadot may not have a day in the sun," Mosoff told CoinDesk.

Other markets

Digital assets on CoinDesk 20 are mostly green Fridays. Notable Winners as of 9:00 PM UTC (4:00 PM ET):

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  • Oil was down 1.7%. Price per barrel of West Texas Intermediate Crude: $ 40.21.
  • Gold was in the green at 0.60% and at $ 1,888 at press time.
  • The US 10-year Treasury yield rose to 0.896 on Friday and is in the green by 2%.


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