Daily Markets Update - October 7, 2020

Total Market Cap $335.3 BN (-1.82%)

24 Hour Volume $104 BN (+11.83%)

Notable Movers EOS (EOS) (+5.77%)

BTC Dominance 58.6% (+0.86%)

What a difference a day makes.  With stimulus talks showing signs of promise yesterday (traditional equity markets moving positively) things took an abrupt U-turn following President Trump’s announcement that new stimulus talks will be suspended until he wins the election. Yet another controversial move as even the Republican Party believed that there was no harm with continuing the stimulus conversations during the polling stages. Markets took further cues from Fed Chairman, Jerome Powell’s warning of  “tragic” risks if the Government doesn’t step in with another stimulus package. The Dow closed down 1.3% whilst the global crypto market cap shed $7 billion in value to 325B (from 333B) yesterday. Interesting to mention that the VIX has been going up for the past six days from 25 to 29.

Digital assets market:

  • All of top 20 large-cap coins saw red, with the exception of $EOS which gained 5.6% on the news of Google Cloud’s participation as a BP node

  • $BTC wiped out its gains from the past two days, trading back at 10,580 range after five consecutive hours of selling action (around the time of the Trump-related news) which sent the price down $200. Next support at 10,530 and 10,500. 

  • $EOS broke out of its range between 2.4 and 2.6 to highs of 2.9 before correcting back to 2.6.

  • $ETH slid as well from 352 levels to 338, consistent with most other coins during this time period. Nearing the next support at 333 and 325 before sitting in an unprotected range at 312.

Alts and DeFi watch:

  • Seeing drops ranging from 2% to as much as 12% for notable DeFi related tokens

  • $YFI dropped to 14,700 levels with its latest two-day price action leading to 22% drop in price with the DeFi sector going through a long overdue correction after a hot September.

News that caught our eye:

  • UK bans crypto derivatives for retail investors in a move seeming to mirror actions taken by the CFTC over Bitmex

  • China’s central bank reports that its DCEP pilots have processed transactions exceeding 1 billion yuan

  • All-time transaction volume on the Silvergate Exchange Network (SEN) has reached $100 billion on back of $BTC and stablecoin trading

UK Regulator Bans Sale of Crypto Derivatives to Retail Users

The FCA said these products are "ill-suited" for retail consumers due to various reasons, including "extreme volatility" of cryptocurrencies. There is no legitimate investment need for retail consumers to invest in these products, said the regulator. Hacks, inadequate understanding, and cryptocurrencies’ "no reliable basis for valuation" are some other listed reasons for the ban.

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93% of the Top 250 Coins Declined in Price in September

The DeFi boom is built on Ethereum and propelled ETH’s price rise from $100 in March to $470 in August. However, the DeFi euphoria has been fading in recent weeks, and there is bearishness in the rest of the market too. For the past two weeks, ETH price has been hovering at around $350.

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75 Crypto Exchanges Have Closed Down So Far in 2020

As least 75 crypto exchanges have closed down due hacks, scams or simply disappeared for unknown reasons so far this year. There are some macro trends which help explain why so many smaller exchanges are failing. The growth of DeFi and the rise of decentralized exchanges in 2020 has put the final nail in the coffin for many smaller operations.

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Google Cloud Joins EOS Blockchain Community 

Google Cloud has joined the EOS blockchain community with the intent of becoming a block producer. This would require approval of the EOS community. EOS, which has often been criticized for excessive centralization, has 21 block producers in total.

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Ripple Threatens to Leave U.S. Over Crypto Regulation (Don't Let the door hit you on the way out)

Executive chairman Chris Larsen said San Fransisco-based Ripple has grown increasingly frustrated over what it perceives as a hostile attitude to the cryptocurrency industry by the federal government, and in particular the Securities and Exchange Commission. Ripple has been locked in a long-running battle with the SEC and investors over whether the digital currency XRP is a security.

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