Turbulence for Blockchain Industry Despite Strong Bitcoin Fundamentals: Report
In the past, it was often said that Bitcoin (BTC) is moving the entire crypto and blockchain industry. Is this still the case?
In recent months, Bitcoin has hit high water, including all-time high long-term ownership rates and local highs in the hash rate difficulty adjustment – but Bitcoin remains in bearish conditions as we enter Q4 of 2022.
Not all areas of the blockchain industry boast such signs of strength, such as venture capital (VC), which brought in $840,000 in October, down 48.6% from the previous month. Similarly, there has been a continued decline in sales of GameFi non-fungible tokens, even with 10% more active players in October than in September.
All the while, regulation continues to be a looming threat from entities such as the United States Securities and Exchange Commission, which is now looking into the possibility of Ether (ETH) being a security given that 46.65% of Ethereum nodes are in the United States.
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Each month, Cointelegraph Research releases an Investor Insights report that analyzes key indicators from various sectors of the blockchain industry, such as regulation, cryptomining, security tokens, Bitcoin and Ether derivatives, and VC activities.
Another positive Bitcoin signal
Bitcoin is trading above its 50-day moving average (MA), with the 100-day MA acting as resistance and the moving average convergence/divergence (MACD) histogram signaling a bullish trend. On-chain data and historically accurate calculations suggest a bottom may be near. Furthermore, the MVRV-Z score has been in the green zone since late June, suggesting that Bitcoin is about to bottom.
Volatility in the post-Federal Open Market Committee (FOMC) was brief on November 2, with the trading range consolidating around the $20,000 level. Aside from the FOMC, volatility could come in the wake of the US midterm elections and Q3 earnings from crypto behemoths MicroStrategy, Coinbase, Block and Robinhood, all of which occur in November.
Bitcoin’s fundamentals remain strong, and the asset that started it all for crypto will likely help keep the industry ultimately on course through the rest of the bear market, even if it may face some volatility along the way. But fortunately, 1 BTC continues to equal 1 BTC.
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Demelza Hays, Ph.D., is the Director of Research at Cointelegraph. Hays has assembled a team of subject matter experts from all areas of finance, economics and technology to bring to market the premier source of industry reports and insightful analysis. The team uses APIs from a variety of sources to provide accurate and useful information and analysis.
With decades of combined experience in traditional finance, business, engineering, technology and research, the Cointelegraph Research team is perfectly positioned to put their combined talents to good use with the Investor Insights report.
The opinions expressed in this article are for general information purposes only and are not intended to provide specific advice or recommendations for any individual or about any specific security or investment product.
