Morning Coinheads.
Bitcoin and other cryptos took a dive alongside US equity markets overnight.
The word is BTC is testing an important support zone, although long-term momentum is looking pretty weak.
Meanwhile, although interest in the NFT market has drifted in 2022, crypto-lending platform Pine sees an opportunity.
It’s Thursday in Cryptoland. Let us begin.
Crypto follows markets on a bit of a slippery slide
Coindesk.com says it best: “It was a red Wednesday for nearly everyone in crypto.”
Red for Bitcoin. Red for Ether. And a whole lot redder for other major altcoins as investors out and out ignored those who reckon digital assets aren’t a wee bit tethered to stocks.
Bitcoin was recently trading around US$28,900, within its range the past few days following the collapse of the TerraUSD (UST) stablecoin and the LUNA token that supports it, but down 5% over the past 24 hours.
The no. 2 crypto by market cap, Ether, was off more than 8% over the same period after slipping below US$2,000.
Among the rest of the declining and the decrepit, SOL, AVAX, DOT, MATIC, SAND and MANA were all down circa 12%.
Technical view: Bitcoin on cusp of further downside
That’s a key support zone for BTC, according to Domainick Dantes and it is also the lower bound of a year-long trading range.
Dantes says a decisive break below US$27,000 could yield further downside targets for BTC, initially toward US$17,823.
“Further, BTC’s downward sloping 50-day moving average indicates persistent trend weakness, which could keep sellers active.”
Bitcoin faces hefty resistance between US$33,000 and US$36,000, which could stall an upswing in price. On the weekly chart, momentum remains negative despite overselling, and Dantes says that could increase the risk of a breakdown in price, similar to what occurred in March 2020 and November 2018.
‘This crypto crash feels amazing’
This is a great read, by Ian Bogost at The Atlantic… less about the structural decline of crypto, more about the last time things got a little bubbly in the tech department.
“A special, acid feeling wells up when you realize that you’ve passed up the opportunity to get rich with no effort whatsoever. Denser than jealousy but lighter than regret, it is a nausea of the spirit rather than the gut. Netscape and bitcoin (and GameStop and perhaps even Tesla) are windfall fantasies. In hindsight, only an idiot would have missed the boat had they been on its gangway at the crucial moment.”
Bogost says of the latest tech dive: it could have been me. I’m glad it wasn’t.
Pine Protocol is really doing Pine Now Pay Later
According to Cryptosaurus, the team behind the Pine Protocol is keen to get y’all buying now and paying later using non-fungible tokens (NFT).
Fresh off closing a US$1.5 million funding round led by Sino Global, Amber and Spartan Group, Pine is building a platform which they say allows NFT holders to access cashola using their NFT as collateral, and a mortgage-type vehicle it is calling “Pine Now, Pay Later” for those who are looking to purchase an NFT but require financing.
“A year ago, I wanted to buy a Meebit but I did not have spare ETH in my wallet. Therefore, I sold my Bored Ape Yacht Club (BAYC) at 7 ETH to execute the trade. I wanted to buy back another BAYC but I never did and I still have my Meebit right now. In hindsight I wish I had access to a platform like Pine,” said Alex Ho, Pine’s co-founder, illustrating a use case for the platform.
“I decided to build out Pine so that NFT owners like myself are able to unlock liquidity without having to sell their NFTs.”
Gen-Z caught in cryptoland: All my friends made me do it
The BBC says youngsters are always keen to make a quick buck – but for Generation Z – it is the volatility and the decentralised lure of digital assets such as cryptocurrency and NFTs which makes the crypto world so dangerous.
“All my friends were talking about [cryptocurrency] so one day I just decided why not just jump in and see if I can make some money,” 20-year-old Paxton See Tow told the Beeb.
All he needed was his phone and trading thousands of dollars’ worth of assets was only a click away. But the unregulated universe of crypto does mean the investor protection is pretty thin.
Generation Z – also known as Zoomers (apparently!) – are the first digital natives. Born twixt the mid-1990s to early-2000s, they grew up online, playing games and meeting friends virtually, so the transition to gamification investing is ‘natural’ says Lily Fang, a professor of finance at INSEAD business school.
“Young people were at home and it’s almost a gamification of trading. All of these factors created a perfect condition for this to take off.”
She says for many young wannabe traders, advice is readily available on platforms such as YouTube, Twitter and Reddit in the form of random, unregulated Fin-fluencers.