Market Wrap: Bitcoin Loses Momentum at $ 19.4K; Ethereum rates on the rise

The number of days of billion dollar spot volume in the bitcoin market is on the rise, pushing prices higher. Ethereum’s transaction fees are also increasing as general interest in cryptocurrencies fuels demand.

Bitcoin closed Wednesday at a price of $ 19,500, reaching $ 19,474, according to data from CoinDesk 20, before losing momentum, to $ 18,883 at press time.

“Following a soaring rise in the past week, bitcoin appears to have consolidated at $ 19,000 even after briefly dipping below this important psychological milestone,” noted Guy Hirsch, US chief executive for multi-brokerage. eToro assets. “This is important because it shows that there is support for bitcoin for this valuation for the first time in its history.”

Read more: The Bitcoin options market suggests investors prepare for the all-time high

“Bitcoin is holding above $ 19,000, so we’re about 2% off approaching the all-time highs last seen in 2017,” noted Elie Le Rest, partner of quantum trading firm ExoAlpha. “Every day we see volumes increase in all locations.”

Helping to drive bitcoin’s price rush is volume. In fact, Tuesday’s combined $ 1.8 billion daily volume across five major USD / BTC spot exchanges (Bitstamp, Coinbase, Gemini, ItBit, and Kraken) is the second largest recorded in 2020, only surpassed by the $ 1 level. , 9 billion of March 13. At press time, Wednesday’s volume for the five trades was nearing $ 1 billion.

“In recent weeks we have seen volumes increase aggressively and we do not expect it to come off too much in the coming days,” noted Michael Rabkin, head of institutional sales for crypto market maker DV Chain. “From a pricing standpoint, we believe there is a lot of momentum in this risk-based market and we can’t see it stop anytime soon given all the money printed globally.”

In fact, the amount of US M2 money went from $ 15 trillion in January to $ 19 trillion in November, a 26% increase in the circulating money supply created this year in an effort to avoid the economic woes caused by the coronavirus.

And while many market watchers speak of bitcoin’s proximity to an all-time high, many ignore the impact that the ether has had on the market as well. An upcoming network upgrade to Eth 2.0 plus an increase in decentralized finance, or DeFi, use cases appear to be fueling the ether fire. In 2020, bitcoin rose more than 162% while ether gained a whopping 343%.

“The recent Eth 2.0 contract milestone is sparking positive sentiment around Ether,” noted John Willock, chief executive of cryptocurrency custody provider Tritium.

Ether (ETH), the second largest cryptocurrency by market capitalization, fell on Wednesday trading around $ 581 and slipping 4.1% in 24 hours at 21:00 UTC (16:00 ET).

Read more: Coinbase will suspend all trading on margin citing the CFTC guide

Transaction fees on the Ethereum network are increasing. Average fees reached 0.00577876 ETH on Tuesday, the highest since October 8.

The Cryptofees.info website, which collects data from Coin Metrics, puts Ethereum first for fees in the cryptocurrency ecosystem. Over the past week, Ethereum has generated nearly $ 3 million in average commissions alone, and the Uniswap, SushiSwap, and Curve network decentralized exchanges (DEXs) are also in the top five in terms of one-week average commissions.

Brian Mosoff, chief executive of the investment firm Ether Capital, says this fee data is a sign of demand from users of the Ethereum network. “A quick glance at cryptofees.info shows that Ethereum is by far the most used network, even more than Bitcoin,” Mosoff noted. “Ethereum fees are increasing due to the appreciation of the ETH price and the demand for network usage.”

Digital assets on CoinDesk 20 are mixed on Wednesday. Notable Winners at 9pm UTC (4pm ET):

Read more: US intelligence raises SEC concerns over China’s encrypted dominance