Cryptocurrency Market Analysis [April 20]
Cryptocurrency Practical Investment Newsletter April 20
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Ranking of domestic and international exchanges I choose
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【Crypto Market Analysis】
The price movements of cryptocurrencies since last week
are summarized as follows
over the past week
Display: current price (change from one week ago)
Bitcoin
6,000,000 yen (-8.5%)
Ethereum
235,000 yen (-%)
Ripple 147 yen (-%)
Polkadot 3,800 yen (-15%)
Binance Coin 54,000 yen (-4%)
Cardano 132 yen (-4%)
NEM 44 yen (-14%)
Uniswap 3,430 yen (4.7%)
Bitcoin was at 6.5 million yen last week
and briefly hit the all-time high of 7,000,000 yen
before dropping significantly from June 18th onward.
Bitcoin Daily Chart
Looking at the latest price of 6,000,000 yen
on the daily chart,
a price drop below the trendline drawn from the February low this year
is appearing.
We are currently at a price level of 6,000,000 yen,
and as shown in the chart,
a horizontal support line can be drawn from the March high to the mid-April low,
and the price is currently rebounding at that level.
This means the price is bouncing off that support.
If the 6,000,000 yen level breaks,
the next potential low around 5.6 million yen could fall.
Additionally, when the all-time high of 7,000,000 yen was reached last week,
the news included
・ Coinbase NASDAQ listing
・ ConsenSys funding
are mentioned.
Coinbase is the largest exchange in the United States, and on April 14th
it listed on NASDAQ
on what was a historic day,
and Bitcoin recorded the highest price of 7,000,000 yen
just before listing.
On the day Coinbase listed (the 14th), the stock price was
nearly $400, but subsequently
it fell to $330 due to panic selling by investors.
In a sense, a baptism, perhaps.
Coinbase’s listing could be seen as Wall Street—regarded as the world’s financial hub for cryptocurrency—acknowledging its influence, in my personal view.
Also, ConsenSys is an Ethereum-related
company, and close to 6.5 billion yen in funding
has been led by major financial institutions like Mastercard, JPMorgan,
and others.
Because of this, Ethereum also reached a peak price of around 270,000 yen last week.
From this news, you can see
the Binance Smart Chain (BSC) has gained influence
recently, but Ethereum’s ecosystem remains a major focus for the future growth.
【Reference】 Reason behind Bitcoin 7,000,000 yen
【Background of Bitcoin Crash】
Recently Bitcoin dropped sharply and
its daily price broke below the trendline.
Regarding this factor:
・ Bitcoin’s hash rate in China declined
・ Large deposits on Binance
are explained by some experts as causes.
Hash rate is an indicator of Bitcoin mining activity,
and in China Bitcoin mining has been active,
and a temporary decline in hash rate
is thought to have contributed to Bitcoin’s drop.
Some argue the hash rate decline was due to power outages,
which prevented Bitcoin mining from processing transactions.
Well, this is just for reference.
Furthermore, there have been reports of large Bitcoin deposits on Binance,
and some view that such deposits led to significant profit-taking selling.
Usually when Bitcoin moves from exchanges to individuals’ wallets
the price tends to rise.
(As people hold Bitcoin long-term)
So, large inflows to exchanges could indicate higher selling pressure.
In any case, a continuous rise is unlikely, so at some point
the cryptocurrency market could fall again.
Nevertheless, a measured take-profit and timely buying
aligned with your investment strategy is essential, don’t you think?
This article previously shared a method for deciding when to take profits
and I publicly disclosed one of my thoughts (paid section),
but even if prices fall,
being mentally resilient is one of the key points to consider.
Profit-taking is greatly influenced by an investor’s trading style,
so there is no one-size-fits-all, and flexible adaptation is necessary.
【About Ethereum’s Value】
The article by Anthony, who argues the value of Ethereum
beyond its price, was introduced on my site.
Recently, in the crypto market, not only Bitcoin
but many other altcoins have risen substantially,
and people who invest by “buy and it goes up”
are becoming more bullish about listings.
However, focusing only on price may be highly speculative.
Ethereum’s value,
as explained by Anthony, is tied to the community that supports Ethereum’s development.
Ethereum forms the basis for many projects, such as
issuing cryptocurrency and decentralized finance (DeFi).
In my view, this is a major factor lifting the overall market cap of cryptocurrencies.
The Ethereum community often thinks about Ethereum’s future
through donations to related development firms,
which is described as more than just price increases.
Another indicator of this is Ethereum staking.
As part of Ethereum 2.0 upgrades, by staking Ethereum you can earn roughly
6–8% interest, but you cannot withdraw until the upgrade completes.
It is said you cannot withdraw for more than a year,
and more than 58 billion yen has been staked.
Recently, major global exchanges like Binance and Coinbase
also support Ethereum staking, allowing holders who deposit ETH on exchanges to participate easily.
Normally, when considering profit-taking from rising prices, staking is not necessarily advantageous,
but the increase in staking may be driven by the many people who are thinking about Ethereum’s future.
In May this year, Uniswap V3 will be released in the decentralized finance system,
and Layer 2 technology is expected to improve Ethereum’s gas fees,
which I am personally highly interested in.
【Reference】 On the value beyond Ethereum price
Also, recently in Canada there was news that Ethereum
ETF has been approved.
An ETF is said to be an exchange-traded fund,
a stock that tracks the price of Ethereum.
The ETF’s impact includes
・ People with stock accounts can easily buy it.
・ It is a stock, so you do not need to hold the physical asset.
・ Tax treatment can be more favorable than cryptocurrency tax, depending on the country.
There is a notable feature like this.
Canada has already listed Bitcoin ETFs this year, and is actively
creating an environment where cryptocurrencies can be traded.
【Token sales are intensely competitive】
Token sales are being conducted on major ICO sites like CoinList
for fundraising, and competition has recently intensified.
Last week there was a Mina Protocol token sale,
and I participated, but
out of 37,000 slots, over 300,000 applicants applied,
which shows extreme demand.
I was around 130,000th, so I could not buy.
Mina’s per-person purchase limit is
$500 (about 60,000 yen),
and many investors were made to participate in an easier way,
but demand greatly exceeded that.
Purchased Mina is locked for a period, but currently
it is said to be worth more than 100 times the sale price.
I think competition in token sales is rising as the crypto market’s total cap grows.
（Reference） Mina Protocol token sale on CoinList started
CoinList
【Finished Cryptocurrency Tax Filing】
Last week was the tax filing deadline, and I finished it without issue.
In the case of cryptocurrency, income is classified as miscellaneous income,
and typically a working person must file if there is more than
20万円 of profit.
Recently in crypto, with increased DeFi trading,
yield farming, lending, and participation in token sales have increased,
making transaction histories more complex and increasing the number of trades.
In crypto trading histories,
unlike ordinary exchanges, DeFi like Uniswap often requires you to create your own records,
so it is important to prepare early.
Also, some people delegate their crypto tax to a tax advisor, but
for complex trades, it is often more efficient for the person who traded to compile the records.
Because tax audits and consultations with tax advisors are inevitable,
this ends up taking a lot of time.
Nevertheless, for tax advisors, the final check of crypto history and handling of expenses
is an area where they can be especially useful.
Most important is that the person who made the trades
keeps thorough records of those trades
to ensure there are no mistakes in profit and loss calculations.
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