Cryptocurrency market analysis [October 22]

Bitcoin Trends: Mild Recovery and Market Bearish Outlook

Bitcoin (BTC) briefly fell below the $105,000 low last Friday, but this week began with a modest recovery, and recently surpassed110,000 dollars.

Bitcoin Fear and Greed Index is at34, and with prices topping110,000 dollars, the index has shown a slight uptick.

However, the overall market mood remains bearish.

This mild price recovery is seen as a move that may be prompted by Federal Reserve Chair Jerome Powell hinting that the Fed’s balance sheet reduction (quantitative tightening: QT) may soon be paused.

This was interpreted by the market as a potential sign that the tightening cycle could be nearing its end.

Ethereum (ETH) Current State and Upcoming Events

Next, Ethereum (ETH) is trading around4,000 dollars, with a slight uptrend. Looking at the chart, it seems to be supported around the high of the ascent in July this year.

Regarding Ethereum, there are several important events planned, including upgrades in December and the potential approval of an ETF with staking features.

XRP and ZEC notable surge

In other assets, XRP (Ripple) announced plans to raise about$10 billion, building the top10 in market cap with the highest rate of increase.

Also, especially the spike inZEC (Zcash) previously mentioned in this article continues to stand out. It has shown daily gains of up to16%, quickly rebounding from big crashes, indicating very strong price movements. This is likely due to growing interest in privacy technology, with Zcash considered one of its key projects.

Vitalik Buterin, the founder of Ethereum, did not directly mention Zcash, but stated that "privacy is the most important thing for Ethereum," indicating a renewed recognition of the importance of privacy technology.

Nevertheless, given this trend, there remains a question as to why zkSync, considered the most technically advanced in zero-knowledge proof technology (zkEVM), is not drawing more attention. Currently, it has not attracted as much interest as might be expected.

Analysts’ Viewpoints and BlackRock CEO Comments

Analysts at Coinbase, the largest US exchange, say for the fourth quarter they are in a "cautious but optimistic stance." They appear to believe there is still room for upside in the crypto bull market.

Personally noteworthy is that Larry Fink, BlackRock’s always-bullish CEO, has begun making unusually cautious remarks such as "Bitcoin is not a bad asset, but over-allocating to it in a portfolio is not good," which may reflect the market's complex psychology.

Major News and Trends

◯ Bank of Japan considering cryptocurrency investments

The Bank of Japan has revealed that it is examining allowing investment in cryptocurrencies. This is also reported by the Nikkei.

· Japanese financial authorities are reviewing regulations to allow banks to invest in crypto assets.

· This could open the door for banks to participate in crypto markets, which were previously constrained.

In Japan, crypto asset exchange regulation has been based on the Payment Services Act since 2017. Now there is movement toward transferring the regulatory framework to the Financial Instruments and Exchange Act.

If banks can custody crypto, institutional investor inflows may be expected, but Japan is currently a latecomer in the crypto field compared with other countries, and the impact is uncertain.

Although Japan is unlikely to take the lead and set the regulatory framework ahead of others, there is an impression that crypto is being reconsidered gradually in this country as well.

◯ Ripple (XRP) raising $1 billion

US Ripple (Ripple Labs) is leading a fundraising of about $1 billion to establish a DAT (Digital Asset Treasury) company focused on XRP, Bloomberg reported on October17.

With this funding, Ripple aims to acquire U.S. treasury companies and purchase XRP. The Digital Asset Treasury is a current trend, but its impact on XRP remains to be seen. XRP remains largely perceived as centralized because most of it is held by Ripple.

The funding is expected to involve SBI with $200 million, and participation from other sources such as Pantera Capital (VC) and Kraken (cryptocurrency exchange).

◯ BTC is on sale — Arthur Hayes

Prominent investor Arthur Hayes has stated that "$BTC is on sale." If turmoil at regional banks in the United States escalates into a crisis, he says to prepare for the bailout measures seen in 2023 (printing money), and asks, "If you have excess funds, go shopping. I have a list, but what’s on everyone else’s list?"

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(This article has been published since 2016)