Daily Market Update, December 16th, 2020- BTC Breaks $20K, Hits Official Record High

Total Crypto Market Cap $601.9 BN (+6.47%)

24 Hour Volume $159.9 BN (+42.90%)

Notable Movers Bitcoin (BTC) (+6.87%) 🥳

Bitcoin Dominance 64.1% (+0.63%)

Twenty thousand isn’t just a nice round number. It’s a floodgate that’s now been opened.

Exchange data shows exactly how the dollar price of bitcoin broke the key psychological $20,000 threshold in early trading hours Tuesday and kept on going. The pattern could be a sign of long pent-up demand for the cryptocurrency, and underscores that seemingly arbitrary levels do matter to the market.

According to data provided by on-chain crypto analytic firm CryptoQuant, there was an unusual spike in the number of stablecoin inflow addresses for all exchanges, an indicator of “extreme buying power,” between 13:30-13:40 UTC (8:30 a.m. to 8:40 a.m. ET).

With an increasing number of institutions in North America and Europe buying bitcoin as an inflation hedge, there is a shrinking supply of the cryptocurrency in the marketplace, according to Simons Chen, executive director of investment and trading at Hong Kong-based crypto lender Babel Finance. Demand was thus able to break through a significant amount of resistance near the previous record high.

“There had been some orders sold at around $20,000 from people who bought bitcoin at high prices back in 2017,” Chen said. “But those orders are mostly gone by now and $20,000 has become the new supporting level.”

Building on ether

The Chicago Mercantile Exchange (CME) announced Wednesday it will launch a futures contract on ether, the world’s second-largest cryptocurrency by market value, in February 2021. CME Group said it was “building on the success of bitcoin futures and options” launched three years ago, which has become synonymous with institutional trading. According to some, there’s a growing class of “ether-first” corporate traders.

Crypto checking

New York-based Quontic Bank has become the first FDIC-insured financial institution to launch a bitcoin rewards checking program. Joining a long line of crypto rewards cards, this is the first that will be overseen by the U.S. Office of the Comptroller of the Currency (OCC). Acting Comptroller Brian Brooks has hinted at more “good” actions on crypto by the end of President Trump’s term.

Bitcoin *Officially* Reaches a Record High!

Breaking news: Out of nowhere, Wednesday saw BTC punch through the $19,400 zone — prompting a 7% surge to dizzying new heights of $20,700. It comes almost exactly three years after the last record of $20,089 was set in December 2017. Will there be a further surge if a U.S. stimulus package is announced? Find out why the celebratory atmosphere comes with a warning for new investors.

How Analysts Reacted to BTC’s All-Time High 🥳

Cameron Winklevoss was meditating when he learned that Bitcoin hit $20,000. Has his relaxed aura had an impact on the crypto markets? Ryan Selkis also noted that it’s a bad day to be a Bitcoin bear — as there are "not a lot of sellers right now, but plenty of buyers." JST Capital co-founder Scott Freeman also told Reuters: "It would not be surprising to see other coins follow in BTC’s footsteps and for this upward trajectory to be sustained into 2021." Check out all the reaction here.

Here’s What Altcoins Are Doing Right Now 🤩

As usual, Bitcoin’s boost has given a leg up to smaller altcoins too. XRP and LTC have actually been outperforming BTC over the past 24 hours. But other major cryptocurrencies have been a little bit more muted — indeed, the privacy coin Monero is up just 0.73% at the time of writing. Read our story for the latest state of play as crypto’s market cap hits $600 billion.

Did This News Help Get BTC Over the Line?

A British investment firm has confirmed that it has invested $744m in Bitcoin — a ringing endorsement of the cryptocurrency. Ruffer says it is pivoting away from gold, and the sum represents 2.5% of its $20 billion portfolio. Could continued institutional demand for BTC cause prices to surge even further in the weeks and months ahead? Read more.

Yes, Before You Ask, Coinbase is Having Problems

As is often the case when Bitcoin experiences a dramatic price move, reports that Coinbase is experiencing connectivity problems have gone through the roof. According to DownDetector, complaints of disruption to the service peaked as BTC rallied. The exchange has been criticized repeatedly for its lack of reliability during busy trading periods in recent months. Read more.

Quick bites

  • BECOMING SELF SOVEREIGN: A how-to guide for setting up a Bitcoin node. (CoinDesk)

  • PAPER-FREE: The German government cabinet passed legislation on Wednesday allowing all-electronic securities to be recorded using blockchain technology. (CoinDesk)

  • NIFTY NFTs: Jess Klein writes about the growing art scene behind Nifty Gateway’s success. (Input)

  • TEMPORARY REGIME: The U.K.’s top financial watchdog has extended an imminent deadline for registering a crypto business to mid-2021. (Decrypt)

  • MAJOR M&A: Japanese financial firm SBI Holdings buys European crypto market maker B2C2. (Modern Consensus)

  • ‘HAPPY STAKING’: Ethereum Foundation researcher Danny Ryan sat for an interview hours before Ethereum 2.0 went live. (CoinDesk)

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