The Month in Review: Analyzing the Cryptocurrency Markets for September 1

The Month in Review: Analyzing the Cryptocurrency Markets for September

Crypto Industry
Digitex Futures
• Dave Reiter
September 30, 2019

What happened to the 2019 cryptocurrency bull market? The crypto community basked in the glow of a substantial rally during the first six months of the year. However, the powerful bull market came to an abrupt end in July. Over the course of the past 90 days, the entire cryptocurrency universe has reversed course and surrendered a substantial portion of its gains from the first half of the year. Will this trend continue for the remainder of 2019?

What Happened to the Cryptocurrency Bull Market in September?

In regard to the month of September, all of the major cryptocurrencies (with the exception of ETH) generated a loss. The biggest loser was Bitcoin Cash, which recorded a decline of 20.5%. Why have cryptocurrencies struggled during the past 60 days? Let’s examine the details and why the cryptocurrency bull market seems to have come to an end. 
Crypto results September

Is Bakkt Bullish or Bearish for the Crypto Universe?

Finally on 23 September, Bakkt opened its doors for trading on the Intercontinental Exchange. Bakkt has been a much-anticipated addition to the cryptocurrency ecosystem. Why? Because it is the first company to offer a physically-delivered Bitcoin futures contract on a regulated exchange. 
According to most crypto experts, institutional investors would not enter the Bitcoin arena until there was a regulated exchange offering physically-delivered BTC futures contracts. Thanks to the launching of Bakkt, institutional money can now flow into digital assets, specifically Bitcoin.

Why are institutional investors so important to the long-term success of Bitcoin? Because they control the vast majority of global investment dollars. For example, according to data provided by the Federal Reserve Bank of St Louis, there is currently $2.14 trillion dollars parked in institutional money funds. 

Essentially, these are institutional dollars sitting on the sidelines waiting to make an investment in a major asset class. The launching of Bakkt on 23 September has given institutional investors the “green light” to invest in Bitcoin. Please review the following table.
institutional funds crypto
This table displays the number of institutional dollars parked in money funds for the past 29 years. As you can see, money funds reached its peak in 2009, following the global financial crisis. The balance slowly declined from 2010 through 2017. However, during the past two years, money fund balances have been on the rise. As we mentioned, the current balance is $2.14 trillion.
Bakkt picked a perfect time to launch the exchange. Institutional dollars are overflowing, searching for an investment vehicle. If institutional investors decide to invest just a small portion of the money funds in Bitcoin, the price could explode dramatically higher. Obviously, this is definitely bullish for BTC.

Rehypothecation

On the bearish side, many crypto investors are worried that the arrival of Bakkt will bring about the rehypothecation of Bitcoin. What is rehypothecation? It occurs when a brokerage firm uses assets that have been posted as collateral by their own clients. The brokerage firm uses these pledged assets to cover its own transactions and trades. Consequently, the assets are “double pledged,” which artificially increases the supply of the asset. 
Of course, increasing the supply of an asset has a tendency to suppress the price. This explains why many crypto investors are concerned that Bakkt could actually be bearish for the price of Bitcoin. Bakkt has a custodial relationship with its account holders along with providing warehousing services for its physically-delivered Bitcoin futures contract. These are the necessary ingredients for engaging in rehypothecation.
In the long run, will Bakkt be bullish or bearish for cryptocurrencies? Most likely, Bakkt will be extremely bullish for Bitcoin and other cryptos. As we discussed, there is an incredible amount of institutional dollars waiting to enter the cryptocurrency universe. Bakkt is the perfect vehicle for allowing institutions to invest in Bitcoin. Why? 
Because Bakkt is regulated and it offers physically-delivered futures contracts. In regard to rehypothecation, it is definitely a concern to the crypto community because it creates an artificial supply of bitcoins. However, the benefit of institutional dollars far outweigh any problems that may occur because of rehypothecation.

Why is Bitcoin Experiencing a Mini Meltdown?

It’s deja vu all over again! When the Chicago Mercantile Exchange (CME) launched its BTC futures contract in December 2017, it coincided with a major top. In fact, Bitcoin recorded its all-time high on the exact day of the CME launch on 18 December 2017. So far, BTC has been unable to penetrate the high from December 2017 @ 19,862.

Bakkt launched on 23 September. In a strange twist of fate, it appears that the Bakkt launch is exerting the exact same downward pressure on Bitcoin just like the CME launch forcing the cryptocurrency bull market to a halt.

BTC was trading at 10,146 when trading activity began on Bakkt. Four days later on 26 September, the price of Bitcoin had plummeted to 7,783. This represents a massive decline of 23.2%. What happened? Why did BTC experience such a brutal decline immediately following the CME launch and the Bakkt launch? The most logical reason is that traders were concerned with rehypothecation. As you know, rehypothecation creates an artificial supply of the underlying asset. As a result, prices are suppressed. This probably explains the brutal decline during the past week.
Please review Chart #1. 
The Month in Review: Analyzing the Cryptocurrency Markets for September 2
In a recent article, we discussed the probability that BTC had formed an important top on 26 June @ 13,844. So far, this appears to be the most likely scenario. Bitcoin enjoyed a dramatic rally during the first six months of 2019, rising 276%. However, BTC has struggled during the past three months, losing 40% of its value. As we discussed in previous articles, the important numbers to watch are 4,440 – 5,704 – 6,568 – 8,485 – 9,966. 

Most likely, BTC is on its way to 6,568. 

Please review Chart #2.
The Month in Review: Analyzing the Cryptocurrency Markets for September 3

Digitex Continues to Push Forward

30 November is just around the corner! The Digitex Futures exchange will launch on the public testnet. During the past few months, it has become very apparent that Adam Todd made an excellent decision to use SmartDec for developing and programming the Digitex Futures exchange and trading platform. SmartDec and Digitex are on the verge of creating a truly disruptive product within the futures industry. Digitex has tremendous upside potential.    
Digitex Futures writers and/or guest authors may or may not have a vested interest in the Digitex Futures project and/or other businesses mentioned throughout the site. None of the content on Digitex Futures is investment advice nor is it a replacement for advice from a certified financial planner.

September 30, 2019
Crypto Industry
Digitex Futures

The Month in Review: Analyzing the Cryptocurrency Markets for September

Dave Reiter
The Month in Review: Analyzing the Cryptocurrency Markets for September 4

What happened to the 2019 cryptocurrency bull market? The crypto community basked in the glow of a substantial rally during the first six months of the year. However, the powerful bull market came to an abrupt end in July. Over the course of the past 90 days, the entire cryptocurrency universe has reversed course and surrendered a substantial portion of its gains from the first half of the year. Will this trend continue for the remainder of 2019?

What Happened to the Cryptocurrency Bull Market in September?

In regard to the month of September, all of the major cryptocurrencies (with the exception of ETH) generated a loss. The biggest loser was Bitcoin Cash, which recorded a decline of 20.5%. Why have cryptocurrencies struggled during the past 60 days? Let’s examine the details and why the cryptocurrency bull market seems to have come to an end. 
Crypto results September

Is Bakkt Bullish or Bearish for the Crypto Universe?

Finally on 23 September, Bakkt opened its doors for trading on the Intercontinental Exchange. Bakkt has been a much-anticipated addition to the cryptocurrency ecosystem. Why? Because it is the first company to offer a physically-delivered Bitcoin futures contract on a regulated exchange. 
According to most crypto experts, institutional investors would not enter the Bitcoin arena until there was a regulated exchange offering physically-delivered BTC futures contracts. Thanks to the launching of Bakkt, institutional money can now flow into digital assets, specifically Bitcoin.

Why are institutional investors so important to the long-term success of Bitcoin? Because they control the vast majority of global investment dollars. For example, according to data provided by the Federal Reserve Bank of St Louis, there is currently $2.14 trillion dollars parked in institutional money funds. 

Essentially, these are institutional dollars sitting on the sidelines waiting to make an investment in a major asset class. The launching of Bakkt on 23 September has given institutional investors the “green light” to invest in Bitcoin. Please review the following table.
institutional funds crypto
This table displays the number of institutional dollars parked in money funds for the past 29 years. As you can see, money funds reached its peak in 2009, following the global financial crisis. The balance slowly declined from 2010 through 2017. However, during the past two years, money fund balances have been on the rise. As we mentioned, the current balance is $2.14 trillion.
Bakkt picked a perfect time to launch the exchange. Institutional dollars are overflowing, searching for an investment vehicle. If institutional investors decide to invest just a small portion of the money funds in Bitcoin, the price could explode dramatically higher. Obviously, this is definitely bullish for BTC.

Rehypothecation

On the bearish side, many crypto investors are worried that the arrival of Bakkt will bring about the rehypothecation of Bitcoin. What is rehypothecation? It occurs when a brokerage firm uses assets that have been posted as collateral by their own clients. The brokerage firm uses these pledged assets to cover its own transactions and trades. Consequently, the assets are “double pledged,” which artificially increases the supply of the asset. 
Of course, increasing the supply of an asset has a tendency to suppress the price. This explains why many crypto investors are concerned that Bakkt could actually be bearish for the price of Bitcoin. Bakkt has a custodial relationship with its account holders along with providing warehousing services for its physically-delivered Bitcoin futures contract. These are the necessary ingredients for engaging in rehypothecation.
In the long run, will Bakkt be bullish or bearish for cryptocurrencies? Most likely, Bakkt will be extremely bullish for Bitcoin and other cryptos. As we discussed, there is an incredible amount of institutional dollars waiting to enter the cryptocurrency universe. Bakkt is the perfect vehicle for allowing institutions to invest in Bitcoin. Why? 
Because Bakkt is regulated and it offers physically-delivered futures contracts. In regard to rehypothecation, it is definitely a concern to the crypto community because it creates an artificial supply of bitcoins. However, the benefit of institutional dollars far outweigh any problems that may occur because of rehypothecation.

Why is Bitcoin Experiencing a Mini Meltdown?

It’s deja vu all over again! When the Chicago Mercantile Exchange (CME) launched its BTC futures contract in December 2017, it coincided with a major top. In fact, Bitcoin recorded its all-time high on the exact day of the CME launch on 18 December 2017. So far, BTC has been unable to penetrate the high from December 2017 @ 19,862.

Bakkt launched on 23 September. In a strange twist of fate, it appears that the Bakkt launch is exerting the exact same downward pressure on Bitcoin just like the CME launch forcing the cryptocurrency bull market to a halt.

BTC was trading at 10,146 when trading activity began on Bakkt. Four days later on 26 September, the price of Bitcoin had plummeted to 7,783. This represents a massive decline of 23.2%. What happened? Why did BTC experience such a brutal decline immediately following the CME launch and the Bakkt launch? The most logical reason is that traders were concerned with rehypothecation. As you know, rehypothecation creates an artificial supply of the underlying asset. As a result, prices are suppressed. This probably explains the brutal decline during the past week.
Please review Chart #1. 
The Month in Review: Analyzing the Cryptocurrency Markets for September 5
In a recent article, we discussed the probability that BTC had formed an important top on 26 June @ 13,844. So far, this appears to be the most likely scenario. Bitcoin enjoyed a dramatic rally during the first six months of 2019, rising 276%. However, BTC has struggled during the past three months, losing 40% of its value. As we discussed in previous articles, the important numbers to watch are 4,440 – 5,704 – 6,568 – 8,485 – 9,966. 

Most likely, BTC is on its way to 6,568. 

Please review Chart #2.
The Month in Review: Analyzing the Cryptocurrency Markets for September 6

Digitex Continues to Push Forward

30 November is just around the corner! The Digitex Futures exchange will launch on the public testnet. During the past few months, it has become very apparent that Adam Todd made an excellent decision to use SmartDec for developing and programming the Digitex Futures exchange and trading platform. SmartDec and Digitex are on the verge of creating a truly disruptive product within the futures industry. Digitex has tremendous upside potential.    
Digitex Futures writers and/or guest authors may or may not have a vested interest in the Digitex Futures project and/or other businesses mentioned throughout the site. None of the content on Digitex Futures is investment advice nor is it a replacement for advice from a certified financial planner.

Latest News

The Cryptocurrency Market — Dave's Monthly Review 7

The Cryptocurrency Market — Dave’s Monthly Review

Digitex Futures
Trading
• Dave Reiter
August 30, 2019

After enjoying a strong bull market rally during the first six months of 2019, the cryptocurrency market hit a brick wall in July and August. For the second consecutive month, the crypto bulls watched their favorite digital currencies decline in value. All of the major cryptocurrencies generated a loss for the month of August. 
Despite these losses, there was one major “bright spot” in the crypto community. The Digitex native currency (DGTX) managed to end the month in positive territory. For the month of August, DGTX gained 2.6%, while the average loss from the major cryptocurrencies was (20.3%). Why have cryptocurrencies struggled during the past 60 days? Will this trend continue for the remainder of 2019? Let’s examine the details.
The Cryptocurrency Market — Dave's Monthly Review 8

Bakkt Has Been Cleared to Launch

Without question, the biggest piece of news emanating from the crypto community during the month of August was the announcement released by Bakkt on 16 August. After several delays and false starts, Bakkt unveiled its plans to launch a new Bitcoin (BTC) futures product beginning on 23 September.
This will place Bakkt in direct competition with Bitcoin futures products offered by the Chicago Mercantile Exchange (CME). The vast majority of members in the cryptocurrency community are heavily in favor of Bakkt’s entrance into the Bitcoin futures arena. They view the Bakkt news as “bullish” for the long-term direction of BTC and other major cryptocurrencies. 
Contrary to popular belief, Bakkt is not a cryptocurrency futures exchange. Instead the company provides custody services for its physically-delivered Bitcoin futures product.
Essentially, Bakkt is a warehouse. Its parent company, the Intercontinental Exchange (ICE) will provide the necessary infrastructure to allow Bakkt to offer BTC futures. The launching of Bakkt is another example of the unprecedented growth that is occurring in derivatives trading within the cryptocurrency community.
In addition to Bakkt, four other firms are working with regulators to offer similar cryptocurrency derivatives products. The list includes LedgerX, ErisX, Seed CX and trueDigital. Given the dramatic increase in crypto trading volume during the past two years, there’s no doubt that cryptocurrencies will soon be regarded as a major asset class by the global investment community.

Bitcoin is Struggling to Stay Above The $10K Level

On 24 June, BTC pushed above $10K for the first time since March 2018. Bitcoin stayed below $10K for 15 consecutive months. During the past 60 days, BTC has been locked in a narrow trading range (Chart #1). The cryptocurrency has been unable to consistently stay above the $10K level. This is not a good sign for the Bitcoin bulls.
The Cryptocurrency Market — Dave's Monthly Review 9
In a recent article, we discussed the probability that BTC had formed an important top on 26 June @ 13,844. So far, this appears to be the most likely scenario. Bitcoin enjoyed a dramatic rally during the first six months of 2019, rising 276%. However, BTC has been unable to record any additional gains above 13,844. Of course, the recent price action could simply be a period of consolidation prior to another explosive move to the upside.
In order to fully regain its bullish momentum, Bitcoin needs to generate a weekly close above 13,844. Until BTC records a new high for 2019, it is definitely vulnerable to a nasty decline. If Bitcoin begins to roll over to the downside, the important numbers to watch are 4,440 – 5,704 – 6,568 – 8,485 – 9,966. Please review Chart #2.
The Cryptocurrency Market — Dave's Monthly Review 10

Digitex is Moving Forward

Despite a few setbacks along the way, the Digitex Futures exchange continues on its journey to becoming the first zero-fee cryptocurrency futures exchange. In May, Digitex teamed up with SmartDec for help in developing and programming the futures exchange and trading platform. SmartDec is a highly successful company located in Moscow, Russia specializing in software development, smart contract development and software auditing.
Recently, Digitex announced the exciting news that it will launch on the Ethereum public testnet beginning 30 November. This will give traders an opportunity to experience the Digitex trading platform on a real-time basis. Launching on the Ethereum public testnet will allow Digitex the ability to continue testing, modifying and enhancing its state-of-the-art trading platform. The future looks bright for Digitex!

Bitcoin Update

This article was written on 28 August. Shortly after the completion of this article, Bitcoin penetrated the important support level @ 9,966. At least for now, BTC has fallen into bearish territory. Most likely, Bitcoin will drop below the next support level @ 8,485. Please review Chart #3.
The Cryptocurrency Market — Dave's Monthly Review 11
Digitex Futures writers and/or guest authors may or may not have a vested interest in the Digitex Futures project and/or other businesses mentioned throughout the site. None of the content on Digitex Futures is investment advice nor is it a replacement for advice from a certified financial planner.

August 30, 2019
Digitex Futures
Trading

The Cryptocurrency Market — Dave’s Monthly Review

Dave Reiter
The Cryptocurrency Market — Dave's Monthly Review 12

After enjoying a strong bull market rally during the first six months of 2019, the cryptocurrency market hit a brick wall in July and August. For the second consecutive month, the crypto bulls watched their favorite digital currencies decline in value. All of the major cryptocurrencies generated a loss for the month of August. 
Despite these losses, there was one major “bright spot” in the crypto community. The Digitex native currency (DGTX) managed to end the month in positive territory. For the month of August, DGTX gained 2.6%, while the average loss from the major cryptocurrencies was (20.3%). Why have cryptocurrencies struggled during the past 60 days? Will this trend continue for the remainder of 2019? Let’s examine the details.
The Cryptocurrency Market — Dave's Monthly Review 13

Bakkt Has Been Cleared to Launch

Without question, the biggest piece of news emanating from the crypto community during the month of August was the announcement released by Bakkt on 16 August. After several delays and false starts, Bakkt unveiled its plans to launch a new Bitcoin (BTC) futures product beginning on 23 September.
This will place Bakkt in direct competition with Bitcoin futures products offered by the Chicago Mercantile Exchange (CME). The vast majority of members in the cryptocurrency community are heavily in favor of Bakkt’s entrance into the Bitcoin futures arena. They view the Bakkt news as “bullish” for the long-term direction of BTC and other major cryptocurrencies. 
Contrary to popular belief, Bakkt is not a cryptocurrency futures exchange. Instead the company provides custody services for its physically-delivered Bitcoin futures product.
Essentially, Bakkt is a warehouse. Its parent company, the Intercontinental Exchange (ICE) will provide the necessary infrastructure to allow Bakkt to offer BTC futures. The launching of Bakkt is another example of the unprecedented growth that is occurring in derivatives trading within the cryptocurrency community.
In addition to Bakkt, four other firms are working with regulators to offer similar cryptocurrency derivatives products. The list includes LedgerX, ErisX, Seed CX and trueDigital. Given the dramatic increase in crypto trading volume during the past two years, there’s no doubt that cryptocurrencies will soon be regarded as a major asset class by the global investment community.

Bitcoin is Struggling to Stay Above The $10K Level

On 24 June, BTC pushed above $10K for the first time since March 2018. Bitcoin stayed below $10K for 15 consecutive months. During the past 60 days, BTC has been locked in a narrow trading range (Chart #1). The cryptocurrency has been unable to consistently stay above the $10K level. This is not a good sign for the Bitcoin bulls.
The Cryptocurrency Market — Dave's Monthly Review 14
In a recent article, we discussed the probability that BTC had formed an important top on 26 June @ 13,844. So far, this appears to be the most likely scenario. Bitcoin enjoyed a dramatic rally during the first six months of 2019, rising 276%. However, BTC has been unable to record any additional gains above 13,844. Of course, the recent price action could simply be a period of consolidation prior to another explosive move to the upside.
In order to fully regain its bullish momentum, Bitcoin needs to generate a weekly close above 13,844. Until BTC records a new high for 2019, it is definitely vulnerable to a nasty decline. If Bitcoin begins to roll over to the downside, the important numbers to watch are 4,440 – 5,704 – 6,568 – 8,485 – 9,966. Please review Chart #2.
The Cryptocurrency Market — Dave's Monthly Review 15

Digitex is Moving Forward

Despite a few setbacks along the way, the Digitex Futures exchange continues on its journey to becoming the first zero-fee cryptocurrency futures exchange. In May, Digitex teamed up with SmartDec for help in developing and programming the futures exchange and trading platform. SmartDec is a highly successful company located in Moscow, Russia specializing in software development, smart contract development and software auditing.
Recently, Digitex announced the exciting news that it will launch on the Ethereum public testnet beginning 30 November. This will give traders an opportunity to experience the Digitex trading platform on a real-time basis. Launching on the Ethereum public testnet will allow Digitex the ability to continue testing, modifying and enhancing its state-of-the-art trading platform. The future looks bright for Digitex!

Bitcoin Update

This article was written on 28 August. Shortly after the completion of this article, Bitcoin penetrated the important support level @ 9,966. At least for now, BTC has fallen into bearish territory. Most likely, Bitcoin will drop below the next support level @ 8,485. Please review Chart #3.
The Cryptocurrency Market — Dave's Monthly Review 16
Digitex Futures writers and/or guest authors may or may not have a vested interest in the Digitex Futures project and/or other businesses mentioned throughout the site. None of the content on Digitex Futures is investment advice nor is it a replacement for advice from a certified financial planner.

Latest News

The Month in Review: Analyzing Crypto Results for July 17

The Month in Review: Analyzing Crypto Results for July

Cryptocurrency
Digitex Futures
Trading
• Dave Reiter
July 31, 2019

After enjoying a strong bull market rally during the first six months of 2019, cryptocurrencies experienced a sizeable decline during the month of July. It was not a good month for crypto traders and investors. All of the major crypto results for July generated losses. The average loss was (24.9%). Monero was the best performer for the month while Zcash turned in the worst performance. What was the driving force behind the crypto decline? Can we expect these losses to continue? Let’s examine the details. Continue reading

July 31, 2019
Cryptocurrency
Digitex Futures
Trading

The Month in Review: Analyzing Crypto Results for July

Dave Reiter
The Month in Review: Analyzing Crypto Results for July 18

After enjoying a strong bull market rally during the first six months of 2019, cryptocurrencies experienced a sizeable decline during the month of July. It was not a good month for crypto traders and investors. All of the major crypto results for July generated losses. The average loss was (24.9%). Monero was the best performer for the month while Zcash turned in the worst performance. What was the driving force behind the crypto decline? Can we expect these losses to continue? Let’s examine the details. Continue reading

Latest News