dollar

Bitcoin analysts eye weakening US dollar as BTC price fights for $17K

BTC price action stays cool over the weekend as Bitcoin bulls attempt to flip $17,000 to support.

Bitcoin (BTC) bulls attempted to retake $17,000 into the Dec. 4 weekly close as volatility looked set to return to the market.

*BTC/USD 1-hour candle chart (Bitstamp). Source: TradingView*

Bollinger Bands demand BTC pricevolatility

Data from Cointelegraph Markets Pro and TradingView showed BTC/USD crisscrossing the $17,000 mark — a focal point throughout the weekend.

With macro cues still to come, Bitcoin looked for catalysts as signs of volatility crept into low timeframes.

Among those eyeing a potential break of the status quo was popular trader Cheds, who noted that the Bollinger Bands volatility indicator was flashing on the 4-hour chart.

Bollinger Bands constricting signals that volatility is due soon, and on the day, 4-hour chart bands were at their narrowest since Nov. 27 — just before BTC/USD gained $1,000.

*BTC/USD 4-hour candle chart (Bitstamp) with Bollinger Bands. Source: TradingView*

Fellow trader Crypto Tony meanwhile stayed put on his short-term BTC price theory.

“Simply no change over the last few days,” he told Twitter followers:

“We are grinding more into the EQ / mid range, but i wouldn’t be surprised to see a wick up to form an SFP and back down.”

*BTC/USD annotated chart. Source: Crypto Tony/ Twitter*

Previously, Crypto Tony flagged $21,500 as a target to aim for if the bulls were to take control and change the trend.

U.S. dollar index reverses relief bounce

The coming week meanwhile looked increasingly important for the U.S. dollar and, by extension, risk asset performance.

Already at its lowest levels in five months, the U.S. dollar index (DXY) looked decidedly bleak at the end of the prior week’s trading.

A bounce to 105.6 on Dec. 2 reversed almost entirely through the day, DXY finishing on 104.5.

For technical analyst Gert van Lagen, it was all part of the plan, with bearish DXY signals apparent even in November.

“Swift bearish continuation would be normal here,” he wrote in an analysis on Nov. 23 to which he returned over the weekend.

*U.S. dollar index (DXY) 1-hour candle chart. Source: TradingView*

“Correction ongoing,” trading resource Stockmoney Lizards added about DXY performance.

The views, thoughts and opinions expressed here are the authors’ alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.

Bitcoin bulls lie in wait as US dollar strength hits 5-month lows

BTC price performance gains some positive tailwinds, but Bitcoin faces a potential top for U.S. stocks.

Bitcoin (BTC) continued to hold key support on Dec. 2 as United States stocks fell on the Wall Street open.

DXY weakness offers hope of “Santa rally”

Data from Cointelegraph Markets Pro and TradingView followed BTC/USD as bulls bought time between $16,800 and $17,000.

Analysts had earmarked the former as a key level to retain; this is, nonetheless, in question at the time of writing as stocks shed 1% to start the session.

Popular crypto analytics account Nunya Bizniz queried whether it was time for a “decision” on S&P 500 performance, eyeing a pattern which suggested a local top may soon appear.

Should that be the case, Bitcoin’s correlation to traditional risk assets would be tested, this having ebbed in the wake of the FTX meltdown.

For the meantime, however, the inversely-correlated U.S. dollar gave bulls little to worry about, the U.S. dollar index (DXY) hitting five-month lows.

DXY wicked down to just 104.37 on the day before rebounding above 105 at the Wall Street open.

*U.S. dollar index (DXY) 1-day candle chart. Source: TradingView*

Fellow analyst Pumpcat thus eyed the six-month close for the chart due at the end of December.

“I think the probablity for a longterm correction is high from here on,” he predicted.

Another popular Twitter analytics account, Cold Blooded Shiller, additionally entertained the idea of a “Santa rally” should macro data and comments from the Federal Reserve complement risk asset performance — to the dollar’s detriment.

“Markets are clearly at an important point – both the $DXY looking like freefall + markets like $SPX looking to try and break the major trendlines that have kept them capped,” a further tweet on the day added.

Analyst reinforces $19,500 significance

Eyeing potential for upside, trader and analyst Rekt Capital stuck with $19,500 as the ceiling for Bitcoin on monthly timeframes.

BTC/USD finished November down 16.2%, having broken through support to trade in a new range in the wake of FTX.

“BTC lost $19500 as support. But it hasn’t turned it into a new resistance,” he wrote:

“Technically, $BTC could relief rally to as high as $19500 to turn it to a new resistance. That would be a textbook confirmation of the breakdown. Doesn’t have to happen but a possibility.”

*BTC/USD annotated chart. Source: Rekt Capital/ Twitter*

The views, thoughts and opinions expressed here are the authors’ alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.

Crypto and fiat savers are making a fatal error — and DeFi can come to the rescue

Across crypto and fiat, many consumers are making a fatal error: they’re letting their assets sit idle in accounts without earning interest.

There’s no escaping it: the DeFi markets have cooled down over the past year.

After breaking $180 billion in total value locked last November — coinciding with Bitcoin racing to a new all-time high of $68,700 — data from DeFiLlama shows the collective value of this market has now dwindled to around $40 billion.

Nonetheless, experts remain bullish on the potential of decentralized finance. Protocols are continuing to build furiously during the bear market — ensuring that they’ll be in a strong position for the next wave of adoption. And although this recent contraction has scared away some retail investors, there are still opportunities to be had.

Here’s the problem — across crypto and fiat, many consumers are making a fatal error. Whether their savings are denominated in U.S. dollars or stablecoins, they’re letting their capital sit idle in accounts that aren’t earning interest. And given the runaway levels of inflation seen in major economies right now, this effectively means that their wealth is diminishing — and spending power is eroding with every passing month.

DeFi can be the answer here, but finding the best opportunities within this nascent space and ensuring that your assets are always allocated efficiently is a task that is virtually impossible to do manually. And even if you come across market-beating levels of yield, it can often change before you are able to take advantage of the opportunity.

Crypto is a volatile market that requires 24/7 monitoring in order to be an efficient investor. Plus, traders often end up with FOMO — a fear of missing out — after deploying their assets to a specific protocol.

What’s the answer?

A new concept that’s emerging in DeFi is reactive liquidity. This means that crypto enthusiasts have the ability to ensure their digital assets are earning the best risk-adjusted yield up until the very moment their assets are needed in a different position. Investors are given the ability to add customizable market triggers to their liquidity which ensure that their positions are monitored on-chain at all times. The moment conditions are met — which are set by the user — liquidity is shifted to where it is needed.

Mero is championing this approach to decentralized finance, and argues that it can have big benefits during this time of market turbulence. It allows funds to be deposited into liquidity pools in exchange for Mero LP tokens. Liquidity that is provided into Mero liquidity pools earns auto-compounded yield from automated yield-farming strategies. Any user who holds Mero LP tokens can register market triggers or actions to their liquidity — enabling them to earn yield on Mero up until the very moment their assets are needed elsewhere.

Mero currently supports market triggers, or actions, for topping up or adding additional collateral for loans on protocols such as Aave and Compound. Once registered, the Mero protocol’s network of keeper bots keeps a close eye on these loans — and shifts liquidity out of Mero pools (where it earns yield) to the loan’s collateral in the blink of an eye in order to avoid liquidations.

The team behind Mero, which was formerly known as Backd, say that they have been driven by a desire to make allocating capital in DeFi not only more efficient, but also a better user experience. Their approach effectively automates the process of asset deployment — ensuring that funds are always allocated most efficiently. When better opportunities emerge, or funds are required for time-sensitive purposes, they can be delegated elsewhere.

All of this can take a lot of weight off a DeFi investor’s shoulders — freeing up precious time so they can focus on other things.

Working across DeFi

As you would expect, continually uncovering competitive yields hinges upon onboarding as many pieces of DeFi infrastructure as possible. Fresh from securing $3.5 million in funding over the summer, Mero Finance intends to do just that.

The platform’s core liquidity pools, which support deposits for DAI, USDC, and ETH have continuously been ranked among the top 10 pools for base APY on Ethereum according to DeFi Llama. Furthermore, since its initial launch last Spring, three security audits have been completed and new dedicated liquidity pools for USDT and FRAX have been added.

More features beyond collateral top-ups are scheduled to launch in the next six months, and work is underway to roll out a governance token, too.

The project told Cointelegraph: “Mero enables you to maximize the power of your assets with reactive liquidity. Start using DeFi like a pro with Mero’s 24/7 on-chain monitoring, interest-bearing assets, and automated liquidity management.”

Material is provided in partnership with Mero

Disclaimer. Cointelegraph does not endorse any content or product on this page. While we aim at providing you with all important information that we could obtain, readers should do their own research before taking any actions related to the company and carry full responsibility for their decisions, nor can this article be considered as investment advice.

Bitcoin price gains $1K in minutes as CPI data deals DXY fresh 2% dip

Wild volatility continues for Bitcoin and altcoins as the lowest CPI readout since January pummels the dollar.

Bitcoin (BTC) surged $1,000 in five minutes before the Nov. 10 Wall Street open as United States inflation and jobs data boosted risk assets.

CPI comes in lowest since the start of 2022

Data from Cointelegraph Markets Pro and TradingView showed BTC/USD climbing to daily highs of $17,782 on Bitstamp.

The pair was just hours from a more-than-two-year low below $15,700 at the time, taking its 24-hour low-to-high to 12.8%.

At the time of writing, BTC/USD circled $17,400 with volatility still rampant as U.S. markets opened to digest economic data.

This had come in the form of the Consumer Price Index (CPI) print for October, along with jobless claims.

Both offered a positive surprise, CPI coming in below expectations and jobless claims above, both implying that the Federal Reserve’s rate hikes were working and that a pivot may come sooner than feared.

Analyzing Bitcoin’s reaction to the Binance order book, monitoring resource Material Indicators showed the nearest resistance hurdle at $18,500.

“Bear Market Rally is still alive,” part of accompanying comments read.

*BTC/USD order book data chart (Binance). Source: Material Indicators/Twitter*

Trading account IncomeSharks was even more optimistic, arguing that $20,000 may return as part of the risk asset rebound.

“Bitcoin- Has an easy path back to $20k as Stocks pushing up and positive CPI numbers,” it told Twitter followers.

At 7.7% year-on-year, the October CPI readout marked the lowest since January, an accompanying press release confirmed.

“The all items less food and energy index rose 6.3 percent over the last 12 months. The energy index increased 17.6 percent for the 12 months ending October, and the food index increased 10.9 percent over the last year; all of these increases were smaller than for the period ending September,” it stated.

*U.S. Consumer Price Index (CPI) chart. Source: Bureau of Labor Statistics*

DXY tanks 2% on economic numbers

Meanwhile, an already weakened U.S. dollar index (DXY) felt instant pain at the release, dropping over 2% for the second time in recent days.

DXY circled 108.6 at the time of writing, its lowest since Sept. 13.

At the same time, stocks opened markedly higher, with the S&P 500 up 3.5% and Nasdaq Composite Index gaining 4.6%.

Popular analyst John Wick, like others, nonetheless advised caution.

“Dollar falling out of the up-channel due to CPI numbers. This giving relief to assets,” he tweeted alongside a DXY chart.

“Just because an up-channel is broken does not mean a sustained downtrend always happens. Often another channel may form at a slower rate of assent, or may jump back to original channel.”

*U.S. dollar index (DXY) annotated chart. Source: John Wick/Twitter*

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.

Bitcoin heads to US midterms as research says dollar ‘closing in’ on a market top

Weekend losses solidify as macro volatility to come meets internal turmoil over FTX.

Bitcoin (BTC) stayed lower at the Nov. 7 Wall Street open as the day before the United States midterm elections opened to flat equities performance.

Crypto wobbles on FTX woes

Data from Cointelegraph Markets Pro and TradingView showed BTC/USD nearing $20,600 at the time of writing — a three-day low.

Volatility was expected around the midterms and the Consumer Price Index (CPI) print for October later in the week.

An additional hurdle in the form of controversy over trading platform FTX added to the market’s cold feet, with commentators wary of unnecessary damage to growth.

“This whole thing is incredibly bad for the industry, and especially for retail,” popular trader and analyst Pentoshi summarized.

“Retail is the one who pays for it when war is waged. But it can also end up with unintended consequences. Unfortunate to see.”

Bitcoin had headed south overnight amid comments from Changpeng Zhao, CEO of the largest global exchange Binance, in which he confirmed that the exchange would be ridding itself of FTX’s in-house cryptocurrency, FTX Token (FTT).

William Clemente, co-founder of crypto research firm Reflexivity, offered a silver lining in the form of increased value for decentralized exchanges (DEXs) going forward.

“Similar to how the mismanagement of risk from centralized crypto lenders earlier this year laid out the bullish case for DeFi, this centralized exchange drama is also laying out the bullish case for DEXs,” he tweeted, referring to the Terra debacle and associated repercussions.

A look at the top 10 cryptocurrencies by market capitalizati showed mixed performance on the day, with 24-hour losses heaviest for Solana (SOL), down 12.4%.

Back on Bitcoin, trader Il Capo of Crypto stayed close to an existing theory of $21,500 marking a local top to come, which would be followed by more severe downside.

“21500 and nuke. Do it,” he wrote on the day.

That theory included a target macro low of $14,000, in stark contrast to other forecasts, which called for $30,000 within weeks.

Analyst: DXY “key to everything”

Both the S&P 500 and Nasdaq Composite Index were meanwhile unmoved ahead of the midterms.

The U.S. dollar index (DXY), busy attempting a reprieve from last week’s losses, circled 110.5 at the time of writing, unable to find bullish momentum.

Precising research into macro markets, Raoul Pal, founder and CEO of Global Macro Investor, called dollar weakness “the key to everything right now.”

“We’re not totally convinced that we can’t make a final push higher towards 117 but we’re closing in on a top,” the research piece added.

Bitcoin is cooling its rally — Here are the BTC price levels to watch next

Bulls have a lot of work left to do, say Bitcoin analysts as consolidation enters for BTC price.

Bitcoin (BTC) consolidated gains on Oct. 27 as the highest levels in six weeks gave way to sideways action.

Bitcoin impresses with stability on GDP print

Data from Cointelegraph Markets Pro and TradingView showed BTC/USD circling $20,500 on Bitstamp after reaching local highs of $21,012 the day prior.

The largest cryptocurrency trod water in line with United States equities at the Wall Street open, with the S&P 500 flat and the Nasdaq Composite Index down around 1% at the time of writing.

The U.S. dollar index (DXY), meanwhile, began to claw back losses on the day, providing a headwind to risk assets absent for much of the week. The DXY had seen its lowest levels since mid-September.

Ahead of a decision on interest rates by the Federal Reserve, gross domestic product (GDP) data showed a rebound for the U.S. economy in Q3.

“This [GDP] number is weaker in terms of the signal it sends about the forward strength of the economy than the last one was, even though the headline was positive,” Eric Winograd, director of developed market economic research at AllianceBernstein, nonetheless told the Financial Times.

In Europe, the European Central Bank (ECB) raised key rates by 0.75%, as expected.

“Big day today, as the ECB comes in with their policy and GDP numbers from the U.S.,” Michaël van de Poppe, founder and CEO of trading firm Eight, summarized.

“Honestly, Bitcoin remains calm at these levels, would have expected a more significant correction since the last push.”

The latest data from CME Group’s FedWatch Tool put the odds of the Fed copying the 0.75% hike at 90.8% on the day.

*Fed target rate probabilities chart. Source: CME Group*

$14,000 return still haunts trader’s chart

Analyzing the weekly BTC/USD chart, popular trader Rekt Capital highlighted the zone immediately below $22,000 as an important one to reclaim for bullishness to continue.

“BTC is slowly approaching the red resistance area,” he wrote in an update on Oct. 26.

Fellow analyst Il Capo of Crypto, meanwhile, said that $21,500 would need to form the basis for consolidation should bulls want to see $23,000 materialize.

His “main scenario” remained a reversal to new macro lows for BTC/USD, potentially hitting $14,000.

*BTC/USD annotated chart. Source: Il Capo of Crypto/Twitter*

Ethereum is ahead of Bitcoin this rally — But ETH price still risks 20% crash against BTC

Ether has entered a bearish range that preceded a 35% price crash in the April–May 2022 session.

Ethereum’s native token, Ether (ETH), recorded better gains than Bitcoin (BTC) over the past 24 hours despite the latter finally rising above the key $20,000 level.

Ether beats Bitcoin in risk-on rally

On the daily chart, Ether jumped approximately 14% to reach its weekly high of $1,554 (data from Binance) on Oct. 26. Bitcoin underwent a similar rally, but its week-to-date profits are just 6% by comparison.

The ETH/BTC pair gained around 8%, climbing as high as 0.075 BTC on Oct. 26.

*ETH/BTC daily price chart. Source: TradingView*

The boom across the top crypto assets has been synchronous with the United States stock market’s winning streak since Oct. 24. It also came on the backdrop of a weaker U.S. dollar index, which has been typically trading inversely to the crypto market since March 2020.

Bear fractal alarm

ETH/BTC’s latest price rally has taken it to a range that preceded a 35% correction in the April–May 2022 session (marked as “R1” in the chart below) and was instrumental in limiting its upside prospects in August–September 2022 (marked as “R3” in the chart below).

*ETH/BTC 3-day price chart. Source: TradingView*

The range coincides with the area defined by ETH/BTC’s 0.236–0.382 Fib lines, or 0.072 BTC–0.077 BTC. Therefore, the pair may stabilize inside the range, followed by a correction toward the 0.068 BTC–0.064 BTC area, its near-term support levels.

Meanwhile, a decisive breakdown below the 0.068 BTC–0.064 BTC area could expose Ether to fall toward its multi-month ascending trendline, which served as a solid rebound point after the April–May 2022 downtrend.

$ETHBTC | Update

The outlook after closing the pair at the top.
You can have a nice projection by analyzing RTed tweets (for education).

With mLTF bearish indications from the red box, the price may visit the lows of the green box.

The red lines are another resistance zone. https://t.co/6zFhLWT1A0 pic.twitter.com/rKnxWsCS3E

— Efloud (@EfloudTheSurfer) October 26, 2022

That puts ETH/BTC’s primary downside target at around 0.059 BTC in Q4 2022, down 20% from current price levels.

Bitcoin price rises above $19.6K as US dollar strength falls to 3-week lows

Dollar weakness shows instant results for BTC price strength, with local highs coming back in for a test.

Bitcoin (BTC) returned to local highs at the Oct. 25 Wall Street open as nervous analysts kept an eye on miners.

DXY provides instant relief for BTC

Data from Cointelegraph Markets Pro and TradingView showed BTC/USD rising to offer a modest challenge to resistance, still unable to escape an established trading range.

United States equities likewise headed modestly higher, with the S&P 500 and Nasdaq Composite Index up 1% and 1.3%, respectively at the time of writing.

The U.S. dollar index (DXY) conversely lost ground on the day, falling to its lowest levels since Oct. 6 and providing potential tailwinds for risk assets to seal opportunistic gains.

For traders, the intraday status quo remained in place amid an ongoing lack of real volatility. Popular Twitter account Crypto Tony highlighted significant range levels, with $18,900 an important zone to hold.

Fellow trader Crypto Ed, meanwhile, revealed that he was “still waiting” for a correction to that level, followed by a bounce past $19,100.

“It might even go a bit lower, then coming back here, that would be your entry for a long,” he said in a YouTube update.

Previously, commentators had revealed a wait-and-see approach to the market, with estimates of a breakout ranging from two to eight weeks.

Miners under surveillance

Downside risk, meanwhile, firmly focused on miners on the day.

With the hash rate at all-time highs but spot price at its lowest in nearly two years, miners continue to battle the tightest profit squeeze in history. They could soon be forced to offload hoarded coins to cover expenses, some warned.

In a dedicated research piece on the topic, Cauê Oliveira, lead on-chain analyst at BlockTrends, in particular, drew attention to hash price — miners’ revenue per exahash.

“At this moment hashprice, as the indicator is known, reached $66,500 which is the lowest value ever recorded,” he explained.

“Total revenue has strongly deviated from its average annual growth. What is common in all bears but with one difference: the costs of maintaining the operation.”

As of September, public miners’ BTC balance totaled a combined 34,509 BTC, a large tranche of liquidity that “can be unloaded as mining pressures continue,” market analyst Sam Rule commented.

“Bitcoin could conceivably capitulate to the $10k-$18k range, fueled by a final selloff from the miners. Something I definitely psychologically prepare for,” longtime analyst Tuur Demeester added.

*Bitcoin miner net position change chart. Source: Glassnode*

With miners exiting a major capitulation phase in August, however, data suggests that even prolonged distribution of coins does not necessarily impact price action negatively.

In early 2021, for example, after BTC/USD had cleared its 2017 all-time high, miners embarked on a mass profit-taking exercise, this failing to hold back Bitcoin as it hit an impulse top of $58,000 in April that year.

According to on-chain analytics firm Glassnode, the selling at that time saw roughly 30,000 BTC leave miner wallets in the month January.

*Bitcoin balance in miner wallets chart. Source: Glassnode*

Bitcoin price hits 1-week lows as Fed rate hike rumors unsettle market

A sudden dip accompanies squabbling over Fed rate hike policy, with BTC price action recovering lost ground.

Bitcoin (BTC) dipped further below $19,000 on Oct. 21 as rumors circulated over the United States Federal Reserve.

Fed still on track for major November rate hike

Data from Cointelegraph Markets Pro and TradingView showed BTC/USD abruptly dropping before the Wall Street open, hitting lows of $18,660 on Bitstamp.

A recovery took the pair higher, and it was attempting reclaim $19,000 as support at the time of writing.

The action came as commentators claimed the Fed was softening its policy on rate hikes ahead of the Nov. 1–2 Federal Open Market Committee (FOMC) meeting.

Citing mainstream media quotations from Fed officials, they suggested that the November hike could be the last 75-basis-point adjustment, with smaller ones following.

“Some officials are more eager to calibrate their rate setting to reduce the risk of overtightening,” Nick Timiraos, chief economics correspondent at the Wall Street Journal, summarized.

“But they won’t want to dramatically loosen financial conditions if and when they hike by 50 bps (instead of 75). This meeting could allow officials to get aligned on next steps.”

Timiraos came in for skepticism following his words, with some accusing him of “leaking” data that would be sensitive for markets.

“How silly that there’s a designated Fed leaker that can drop a timely tweet thread and instantly impact global markets,” popular commentator Stack Hodler wrote.

“Imagine the havoc if someone hacked this guys account and leaked a 100bps raise. Yields rocket and we get UK pension crisis 2.0 — what a janky monetary system.”

According to CME Group’s FedWatch Tool, the odds of a 75-basis-point hike next month remained almost guaranteed, with a mere 6.2% chance of 50 basis points.

*Target rate probabilities chart. Souce: CME Group*

Dollar retreats after yen seals more lows

U.S. equities saw a confident start to trading on the day, while the U.S. dollar swiftly lost ground after earlier causing fresh pain for trading partner currencies.

The U.S. dollar index (DXY) was below 113 at the time of writing, having spiked to near 114 hours prior.

“It’s all about DXY and the consolidation between recent highs and D1 uptrend,” popular crypto trader and analyst Pierre explained, citing the earlier analysis.

In a sign of how problematic the dollar’s rise was becoming, the Japanese yen weakened past the psychologically significant 150 mark — a 32-year low.

“Unless the BOJ gives in in its bond yield suppression, the yen will continue to power lower. JPY 150 breeched,” Alasdair Macleod, the head of research for Goldmoney, forecast.

*USD/JPY 1-month candle chart. Source: TradingView*

New Fidelity report flags ‘stark contrast’ between Bitcoin and fiat currencies

Counterparty risk and “liability” form enduring qualities setting Bitcoin apart, says Fidelity Digital Assets.

Bitcoin’s (BTC) future may “stand in stark contrast to the rest of the world,” asset manager Fidelity Investments predicts.

In a recent research piece, “The Rising Dollar and Bitcoin,” released Oct. 10, Fidelity Digital Assets, the firm’s crypto subsidiary, drew a line between Bitcoin and other currencies.

Bitcoin “does not correspond to another person’s liability:” Report

While hardly a stranger to bullish takes on Bitcoin, Fidelity continues to publicly reiterate its faith in the largest cryptocurrency despite the near year-long bear market.

In the report, analysts stated just how far Bitcoin as an asset has diverged from what is currently considered the norm. In the new high-inflation environment, Bitcoin’s fixed issuance and supply are of particular importance.

“Therefore, bitcoin may soon stand in stark contrast to the path that the rest of the world and fiat currencies may take – namely the path of increased supply, additional currency creation, and central bank balance sheet expansion,” they explained.

While the report’s title places influence on the strength of the United States dollar relative to other world currencies, it was the crisis in the British pound that Fidelity highlighted as the kind of event impossible on a Bitcoin standard.

Summing up, the firm forecast that “more monetary debasement may be needed to alleviate the high debt load among developed economies, while recent events in the United Kingdom have shown counterparty and liability risks in the system, making monetary intervention and doses of liquidity features that are not likely to go away any time soon.”

“Comparatively, bitcoin remains one of the few assets that does not correspond to another person’s liability, has no counterparty risk, and has a supply schedule that cannot be changed,” it concluded:

“Whether those properties begin to look more attractive is ultimately up to investors and the market to decide.”

*Bitcoin monthly returns chart (screenshot). Source: Coinglass*

Volatility remains crypto-sector base case

Elsewhere, Fidelity’s optimistic take on the current state of the Bitcoin network itself diverges from the nervousness of its crypto-sector peers.

The firm’s round-up of research for the month of October pointed to the BTC illiquid supply hitting a ten-year record, as well as surging network fundamentals.

As Cointelegraph reported, meanwhile, in its latest weekly newsletter, “The Week On-Chain,” on-chain analytics firm Glassnode concluded that volatility would be likely what characterized Bitcoin going forward.

“The Bitcoin market is primed for volatility, with both realized and options implied volatility falling to historical lows. On-chain spending behavior is compressing into a decision point, where spot prices intersect with the Short-Term Holder cost basis,” it concluded, summarizing the data points covered.

More widely, traders are preparing for a violent exit of Bitcoin’s narrow trading range within weeks.