Bitcoin, Ethereum, Altcoins - Cryptocurrency Overview - February

 

During the first half of February, the cryptocurrency market gradually increased, reaching its peak by the middle of the month.the maximum value of $ 308 billion. After that, for no apparent reason, the market began the same smooth decline, as a result of which this indicator fell even below the value recorded on the last trading day of January. Thus, closing February at around $ 247 billion, the market showed a decrease in capitalization of 4.6%. Most of the news last month was related to toughening measures aimed at counteracting legalization, optimizing tax issues, as well as the threat of the spread of coronovirus infection, which was one of the main triggers for reducing global financial markets. This time, the opinions of experts regarding the immediate prospects of the market differ significantly. Some of the experts see the “safe haven” in cryptocurrencies until the storm on the world markets settles, and then the role of cryptocurrencies as a hedging instrument becomes stronger in case the virus control is not taken under the necessary control. Such an opinion deserves attention especially amid the fact that WHO has increased the level of danger to the maximum. Other experts note that the model in which cryptocurrencies previously acted as defensive ones broke down for some reason. However, they also agree that this may turn out to be a short-term phenomenon.

First Cryptocurrency Dominance Indexdecreased for the third month in a row. At the end of February, BTC decreased its share in the total market capitalization by 2.1%. At the same time, the weight of ETH increased by 2.3%, XRP increased by 0.1%, and BCH decreased by 0.4%.

The Google Trends indicator, which reflects the number of searches on the topic of bitcoin, is still around its average values ​​over the past 12 months.

 

Bitcoin</p>

The dynamics of the BTC to the US dollar (BTC / USD)

In February, BTC capitalization decreased by 8.5%. In the first half of the month, the bulls tried to overcome the resistance at the psychologically important level of $ 10,000. For several days they managed to keep the price above this level, however, perhaps, due to some relative overbought, there was no continuation, and in the future, the bears seized the initiative. Thus, quotes remain sideways and are currently gradually decreasing to the area of ​​the medium-term trend line. Such dynamics of the first cryptocurrency puzzled many industry experts, because against the backdrop of a collapse in global stock indices, due to the threat of a slowdown in the global economy due to the spread of the coronovirus, as well as rising gold prices, BTC quotes reacted more than restrained, which was not observed before during periods of price volatility in financial markets. Most participants are inclined to believe that after the expiration of CME futures, interest in the coin will increase again, and if the virus spreads further, this tool will play the role of a protective asset. Of the interesting news of the outgoing month, it is also worth noting that the Binance cryptocurrency exchange announced plans to launch options on BTC at the beginning of the second half of this year.

Ethereum

ETH to USD exchange rate dynamics (ETH / USD)

ETH looks a lot more confident showing a secondmonth in a row the dynamics are better than the market. According to the results of February, the coin added about 18% to its capitalization, an increase in trade volumes is observed. From a technical point of view, from the highs reached in the middle of the month, the price of a coin is adjusted to the area of ​​the blue trend line. According to the developers, it is highly likely that the new version of the network (Ethereum 2.0) will work already in the middle of this year. At the same time, during the month of volatility, the coin price was added messages regarding the activation of the ProgPoW code, the purpose of which is to create conditions under which further mining of the coin on ASIC equipment will become ineffective. A number of community representatives called for developers to refuse to activate the code, but in the long term, the decision to activate (if it is finally made), market participants should be perceived positively, since in the future, this fact will help to fuel investor interest in this cryptocurrency market tool. Among other factors that will affect the pricing of ETH in the medium term, it should be noted that, in the opinion of the head of the Commission for the derivatives trading of the United States, in the near future ETH futures will appear on the market.

Ripple</p>

Dynamics of the XRP to the US dollar (XRP / USD)

XRP in February again could not please itsinvestors. By the end of the month, the price of the coin fell by 4%, showing a slightly worse dynamics than the average market. In the first half of February, activity increased significantly, quotes began to grow, but a breakdown of resistance at $ 0.32-0.33 did not occur, as a result, the coin fell under pressure from sellers in the second half of the month. Trading volumes have noticeably increased, while volatility indicators have also increased. From a technical point of view, a volatile sideways pattern is observed in XRP, which, not least, can be caused by the contradictory incoming news flow that was observed during February. Among the factors that have a significant impact on quotes, it is worth noting a court order in the Northern District of California, which states the validity of a class action against Ripple demanding that XRP be recognized as a security and, as a result, a violation of the securities law.

 

Correction currently underway in the marketaffected almost all liquid altcoins. Despite the fact that most of them are still trading significantly higher than last year’s closing prices, cryptocurrency remains open to question. Control by regulators from different countries is increasing. This, of course, has an impact on the dynamics of digital assets. But the measures taken by regulators should benefit the market, make it more transparent, understandable, and as a result, attract new investors here.

Most important news for the month:

In Hong Kong, the authorities plan to further tighten the regulation of the cryptocurrency sphere in security matters, according to the recommendations of the FATF.

In New Zealand, tax authorities may refusetax on goods and services in relation to cryptocurrencies, since in the interpretation of the current legislation of the country, digital assets do not fall into the category of investment products.

According to a deputy representative of the Canadian Central Bank, the bank does not plan to issue its own cryptocurrency in the near future.

In China, due to the coronavirus outbreak, there has been some delay in research work on the digital yuan by the People's Bank of China. At the same time, the timing of the launch of the cryptocurrency has not changed.

At a meeting of finance ministers and heads of centralbanks of the G20 countries once again placed emphasis on the need to implement and comply with the standards for regulating virtual assets, in accordance with the recommendations of the FATF.

The Central Bank of Sweden announced the start of testing its own cryptocurrency, which will last until February 2021.

In the United States in early March, the U.S. tax office will hold a cryptocurrency startup summit to discuss an approach to taxing cryptocurrencies.

In France, lawmakers believe that it is the country's commercial banks with the participation of the ECB that should be engaged in the development of their own digital currency.

Treasury Secretary Steven Mnuchin during hisspeeches in the US Congress announced that the US Treasury Department and the Financial Crimes Enforcement Network will jointly introduce new regulatory requirements for cryptocurrencies.

At a conference at the Graduate School of BusinessA Stanford University spokeswoman said the Federal Reserve is currently exploring the possibility of issuing its own digital dollar.

Russia:

Federal Security ServiceIt is proposed to introduce a ban on the issuance and use of cryptocurrencies as a means of payment in Russia, and to oblige exchange operators to identify the owners of cryptocurrencies.

Based on the results of testing Norilsk Nickel’s blockchain platform, the Bank of Russia proposed amending the bill “On Digital Financial Assets.”

The Bank of Russia will update the list of criteria for suspicious transactions. The new list may also include transactions with digital assets.

According to the Chairman of the State Duma Committee on the Financial Market, Anatoly Aksakov, the State Duma may adopt a law on digital financial assets as early as March this year.