• Bitcoin price continues to hold the $51,335 support, but the depressed outlook continues to become heavier.
  • BTC could make a 10% fall before the next leg up as multiple technical indicators flash bearish signs.
  • A higher high above $52,985 would invalidate the bearish thesis, opening the possibility for more gains.

Bitcoin (BTC) continues to take to a directional bias, with the market now busy truing to read through the 120 pages of BTC creator Satoshi Nakamoto, for clues about his identity. 

Among the highlights is, "My choice for the number of coins and distribution schedule was an educated guess," together with the humorous, "100 push-ups a day will send the price to 100k,"

Also Read: Bitcoin price could drop 7%, but MicroStrategy nearly merits S&P 500 inclusion

Bitcoin creator emails revealed 

In a post on X, one of the earliest collaborators of BTC creator Satoshi Nakamoto has shared emails of their discussion. The revelations have contradicted popular opinion that Satoshi Nakamoto's earliest collaborator was likely Hal Finney, a well-known cryptographer.

Elsewhere in a Thursday blog titled “ETF approval for Bitcoin – the naked emperor’s new clothes”, the European Central Bank (ECB) detailed an analysis of the Bitcoin market, saying that the king of cryptocurrency “has failed on the promise to be a global decentralized digital currency,” adding that BTC “is still hardly used for legitimate transfers.”

The blog also argues that despite the landmark approval of spot BTC exchange-traded funds (ETFs) on January 10, BTC is still not suitable as a means of payment or as an investment. The ECB contravenes the general opinion among crypto proponents that ETF approvals validate BTC as a safe investment.

The Central Bank also said that the preceding rally seen in Bitcoin price following the approvals is proof of an unstoppable triumph is false, highlighting that the fair value of Bitcoin remains zero.

We disagree with both claims and reiterate that the fair value of Bitcoin is still zero…the use of ETFs as financing vehicles does not change the fair value of the underlying assets.

The ECB says that there is a worst-case scenario where Bitcoin’s expected boom fails, urging traders to brace for massive collateral damage, including the “ultimate redistribution of wealth at the expense of the less sophisticated.”

Debunking the “false promises of Bitcoin” and warning of the social dangers if not effectively addressed, the blog argued:

  • Bitcoin has not lived up to its original promise to become a global decentralized digital currency.
  • Bitcoin’s promise to be a financial asset whose value would inevitably continue to rise is equally wrong.
  • Bitcoin transactions are still inconvenient, slow, and costly.
  • Bitcoin is still not suitable as an investment.
  • Bitcoin mining using the proof of work (PoW) mechanism pollutes the environment on the same scale as entire countries.
  • Increased Bitcoin prices imply higher energy consumption because then miners are able to cover higher costs.

Further, the ECB report acknowledges that while Bitcoin price is gaining as hope grows the Fed could lower interest rates and increase the risk appetite of investors. Then again, the report says, “This could turn out to be a flash in the pan.”

Bitcoin price outlook as the ECB wrecks and demolishes BTC

Meanwhile, as Bitcoin price’s horizontal consolidation continues, the market is slowly leaning to the downside. The price is testing the immediate support at $51,335 and could break below it as multiple technical indicators flash bearish.

To start with, the Relative Strength Index (RSI) has already executed a sell signal by crossing below its signal line (yellow band). The Moving Average Convergence Divergence (MACD) is also teasing with a potential bearish crossover below its signal line (orange line).

In addition, the histogram bars of the MACD are also fading as they edge toward negative territory. The same outlook is seen with the Awesome Oscillator (AO) histogram bars, flashing red as they edge toward the mean line.

If the $51,335 support gives in, Bitcoin price could drop, first losing the $50,000 milestone as support with the possibility of extending to the $48,000 level. In a dire case, the fall could see BTC retrace the $40,000 psychological level, almost 23% below current levels.

Also Read: Bitcoin back over $51K, crypto market recovers as Nvidia's earnings rejuvenates AI-tokens

BTC/USDT 1-day chart

On the other hand, increased buying pressure could see Bitcoin price reclaim its range high of $52,985, last tested on February 20. Clearing this blockade could set the pace for Bitcoin price to extend past the $53,000 level. A break and close above this level would make $60,000 the next target for BTC. A test of this psychological level would denote a 17% climb above current levels.

Also Read: Top 3 Price Prediction Bitcoin, Ethereum, Ripple: Crypto market cowers with sell signals after FOMC minutes

Cryptocurrency metrics FAQs

What is circulating supply?

The developer or creator of each cryptocurrency decides on the total number of tokens that can be minted or issued. Only a certain number of these assets can be minted by mining, staking or other mechanisms. This is defined by the algorithm of the underlying blockchain technology. Since its inception, a total of 19,445,656 BTCs have been mined, which is the circulating supply of Bitcoin. On the other hand, circulating supply can also be decreased via actions such as burning tokens, or mistakenly sending assets to addresses of other incompatible blockchains.

What is market capitalization?

Market capitalization is the result of multiplying the circulating supply of a certain asset by the asset’s current market value. For Bitcoin, the market capitalization at the beginning of August 2023 is above $570 billion, which is the result of the more than 19 million BTC in circulation multiplied by the Bitcoin price around $29,600.

What is trading volume?

Trading volume refers to the total number of tokens for a specific asset that has been transacted or exchanged between buyers and sellers within set trading hours, for example, 24 hours. It is used to gauge market sentiment, this metric combines all volumes on centralized exchanges and decentralized exchanges. Increasing trading volume often denotes the demand for a certain asset as more people are buying and selling the cryptocurrency.

What is funding rate?

Funding rates are a concept designed to encourage traders to take positions and ensure perpetual contract prices match spot markets. It defines a mechanism by exchanges to ensure that future prices and index prices periodic payments regularly converge. When the funding rate is positive, the price of the perpetual contract is higher than the mark price. This means traders who are bullish and have opened long positions pay traders who are in short positions. On the other hand, a negative funding rate means perpetual prices are below the mark price, and hence traders with short positions pay traders who have opened long positions.

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