Over the past week, the cryptocurrency market has shown noticeable growth. Bitcoin grew by 12% to more than $48,000, Ethereum followed suit and increased by 11% to a resistance level of $3,500. Although, the daily trading volume practically did not increase during this week.
At the same time, China‘s bans on the cryptocurrency industry continued and entailed many negative consequences. Almost all cryptocurrency exchanges in China are winding down their activities in this country. These include Huobi, OKEx, Kucoin, Binance, and many more. The largest mining pools including SparkPool, BeePool and F2Pool also stopped serving customers from China. Even the largest mining device manufacturer, Bitmain, is relocating production to other countries.
Thus, the situation in China has become very tense and it seems that the authorities have decided to finally suppress all activities related to cryptocurrencies. All companies in one way or another connected with this country leave this jurisdiction. An interesting fact is that all this negative news had almost no effect on Bitcoin and the cryptocurrency market.
But the main opponent of China on the world stage, the United States, has exactly opposite views on the crypto industry. So, the head of the FRS said that they are not going to prohibit or restrict cryptocurrencies, but just want to bring them into the legal field. Basically, this concerns the regulation of stablecoins. This bill is already being actively formed. It was thanks to this news that the entire cryptocurrency market experienced the strongest rise.
A new major bug occurred in one of the largest DeFi protocols – Compound. Last week, the team updated a smart contract that rewards users for providing liquidity. Several users immediately saw the vulnerability in the smart contract and almost completely emptied the wallet of the smart contract in the amount of $82 million. This is the first hack of a large project in a long time. However, it did not affect the crypto market in any way.
El Salvador continues to promote its Bitcoin activities. This time, this state announced that it is going to mine Bitcoin using a volcanic power plant. President of this country, Nayib Bukele, even showed the first satoshi mined in this way. Recall that El Salvador began planning Bitcoin mining in early June of this year and was actively purchasing mining equipment in the summer of 2021st.
Let’s take a look at how all these events are reflected on the Bitcoin chart and try to analyze in which direction the price might go this week:
In the middle of the last week, Bitcoin fell to $40,500. After the release of positive news from the FRS, the chart confidently turned upward and showed significant growth. The price went up from the falling wedge as we expected. Now Bitcoin is likely to continue its growth to the level of $52,000 – $53,000.
Indicators also point to continued growth. RSI and MACD have a clear uptrend that can be uptrend all week. The only factor that raises doubts is the low trading volumes. However, this may be due to the protracted falling of the cryptomarket in September.
Many altcoins also showed significant gains of tens of percent. This trend may continue in the near future, especially if Bitcoin is showing growth. It is difficult to say if the altcoin market will outperform Bitcoin this time because its dominance is in great uncertainty.
September closed with a fall for the fifth year in a row. Usually, October happened to be a positive month for the crypto market. Over the past 4 days, this has already fully manifested itself, as the market grew by 10% and again exceeded the $2 trillion bar.