Bitcoin Hits a New ATH Above $63,000 & Ether $2,200 Amidst Extreme Excitement & Wariness About Coinbase IPO
The crypto market is either hyper bullish or bearish of the direct listing of the largest US crypto exchange on Wednesday while BTC, after a month from last high and trading above $72k on Korean exchanges, and Ether both hit a new ATH.
It has officially been a month that the price of Bitcoin last hit its all-time high of about $61,850. And today, BTC hit a new high at $63,200 on Coinbase. Ether also hit a new ATH at $2,222 on the exchange.
In line with BTC’s gains, XRP, UNI, LTC, XLM, DOGE, LUNA, RUNE, and others are also rallying. XRP -8.52% XRP / USD XRPUSD $ 1.34
-$0.11-8.52% Volume 11.29 b Change -$0.11 Open $1.34 Circulating 35.11 b Market Cap 47.2 b 1 d Positive Momentum for Ethereum Continues with Another $60 Million in Inflows: CoinShares Report 5 d BoE Governor Andrew Bailey Says Crypto Investors Trading In A Bubble 5 d Ripple Reports 97% Growth In XRP Sales For Q1 2021 Amid SEC Lawsuit LTC -14.68% Litecoin / USD LTCUSD $ 323.57
-$47.50-14.68% Volume 10.27 b Change -$47.50 Open $323.57 Circulating 66.75 m Market Cap 21.6 b 1 d Positive Momentum for Ethereum Continues with Another $60 Million in Inflows: CoinShares Report 1 d Tech Stocks Dragging Bitcoin, Ether, & Crypto's Down, But 'Fundamentals Still Strong' 6 d Ethereum Fork ETC Trading 12% Higher on Coinbase, CAKE Wicks Down Over 13.5% on Binance XLM -9.58% Stellar / USD XLMUSD $ 0.61
-$0.06-9.58% Volume 3.2 b Change -$0.06 Open $0.61 Circulating 23.1 b Market Cap 14.19 b 1 d Tech Stocks Dragging Bitcoin, Ether, & Crypto's Down, But 'Fundamentals Still Strong' 5 d Market Experts View Cryptocurrencies As Major Risk, Fed Survey Reveals 6 d Tala Partners With VISA To Drive USDC Adoption in Emerging Markets DOGE -16.94% Dogecoin / USD DOGEUSD $ 0.42
-$0.07-16.94% Volume 11.65 b Change -$0.07 Open $0.42 Circulating 129.58 b Market Cap 54.49 b 20 h USD Index is Crashing; It Has Been Historically Bullish for Bitcoin 1 d Palantir says Bitcoin Is 'Definitely on the Table' to be Put on the Balance Sheet 1 d Tesla's Elon Musk Considers Accepting Dogecoin As Payment For Cars in New Twitter Poll LUNA 12.86% Luna Coin / USD LUNAUSD $ 0.01
$0.0012.86% Volume 0 Change $0.00 Open $0.01 Circulating 1.71 m Market Cap 16.37 K 5 d Burnt Finance Raises $3M For A Solana-based NFT Marketplace; Famous for Burning Banksy Art Piece 5 d Cryptocurrency Related Stocks Tumbling in a Massive Divergence from Crypto Assets 1 w Binance Smart Chain (BSC) TVL Reaches $45 Billion, Catching Up Fast to Ethereum RUNE -4.96% THORChain / USD RUNEUSD $ 17.90
-$0.89-4.96% Volume 294.57 m Change -$0.89 Open $17.90 Circulating 239.9 m Market Cap 4.29 b 5 d Cryptocurrency Related Stocks Tumbling in a Massive Divergence from Crypto Assets 3 w Crypto Market Is Recovering Beautifully, Double-Digit Gains Recorded 4 w Mark Cuban HODLing DOGE for Life, Reports a 550% in Dogecoin Payments for Mavs Merch
While the BTC price prepares for a strong breakout to $70k, Kimchi premium has also returned with a vengeance.
Bitcoin Already Above $70k
After getting popular during the top of the 2017 bull market, this higher price of crypto assets on South Korean cryptocurrency exchanges made its reappearance at the beginning of this year.
“In the last 2 weeks, the Kimchi premium returned with a vengeance reaching over 20%, the highest level we’ve seen since 2017-18. While restricted travel is a major contributing factor to the arb, one cannot ignore the buying frenzy in the Korean retail market, especially in Alts,” noted QCP Capital, Asia’s crypto traders.
The level of Korean crypto frenzy has risen so much that volume on crypto exchanges in the country at times surpasses that of equity exchanges. Also, people from all age groups have been consumed by this frenzy that “could possibly draw increased regulatory intervention.”
However, currently, the Korean market only accounts for roughly 2% of global crypto trading volumes compared to 7-8% in 2018. According to QCP Capital,
“such retail fever, in general, tends to put a damper on topside price breakouts for the largest market cap coins especially BTC.”
During alt-season, this pattern is rather typical as small market cap tokens record massive gains.
Distracting Juicy Yield
Another evidence of outsized buying interest can be seen in the BTC futures curve, which has hit a fresh ATH on a 3month basis at well over 40% annualized.
“This massive contango is the steepest of any financial asset class out there by far and has been attracting a lot of attention in the mainstream media with institutions especially keen to get in on the risk-free futures roll down yield. This has caused further divergence between CME and native derivative exchanges,” noted QCP Capital.
As we reported, JPMorgan, in its latest weekly report on Bitcoin, pointed out these yields, significantly higher than any other currency.
CME is actually trading at a 10% annualized contango now compared to 43% on Binance, presenting an incredible arbitrage opportunity. It is different from what we saw during 2020’s Sept. Dec. bull run when CME was consistently higher than other exchanges as institutional demand dominated flows.
But now, leveraged buying on non-regulated exchanges is leading the market, which time and again results in liquidations pushing the prices down. Today, funding rates went berserk above 0.3% momentarily before normalizing with the Bitcoin funding rate currently of 0.1640% on Binance.
According to QCP Capital, this divergence is partly caused by retail mania overshadowing the institutional side and because of institutional interest in the rolldown yield, aka cash & carry.
Key Catalyst For The Local Top?
While institutions deploy more to this trade on CME, retail is more inclined to lever up through perpetual swap futures and spot volumes on a decline; the $ 55k level is the next bull/bear line.
Even more bearish for the QCP Capital is the miners’ unusual HODLing behavior, not selling since before the March dip. All of this has them selling out their long calls and covering BTC spot long by selling the June & Sep 68k strikes and on ETH, selling the Jun $2800 strike. ETH -8.44% Ethereum / USD ETHUSD $ 3,915.83
-$330.50-8.44% Volume 79.16 b Change -$330.50 Open $3,915.83 Circulating 115.85 m Market Cap 453.67 b 14 h Balancer Labs Launches V2 With Promises Lower Fees, Higher Yields, and Easy Interface 16 h Aave Is Testing Private Pools for Institutions to Ape into DeFi, Reveals CEO Stani Kulechov 17 h Bitwise Launches Crypto Industry Innovators ETF After a Green Light from the SEC
However, they are not bearish, just that current market dynamics do not favor a further exponential move like Q1.
But while some market participants say this is very bullish and “is going to blow people’s minds, Matt Hougan of Bitwise sees it forcing “traditional finance to wrestle with the phenomenal growth that is taking place in crypto” QCP Capital is “extremely wary.”
“The IPO on Wednesday could ultimately reveal too much short-term froth in the system and begin the seasonal mid-month decline. This seasonal intra-month pattern we highlighted previously has been performing like clockwork this year.”