Weekly Crypto Analysis: Bitcoin Pushes Above $21,000; What's Next?

2023/01/16 13:57:03

Crypto Market Overview

Although the nation's CBDC adoption rate is at a measly 0.5%, the nation’s interest in cryptocurrencies continues to baffle the crypto community and the Nigerian government.
Later this month (January), the team behind the Cardano ecosystem will make available a software toolkit that will let programmers create unique side chains on Cardano with the intention of enhancing the ecosystem.

All eyes this week were pointed at the crypto market as Bitcoin crossed the $21,000 price this week.

Many altcoins like Ethereum and Litecoin gained as much as 30%, and with several macroeconomic factors still lingering, analysts are divided as to whether the bear run is over or there is still one last pop remaining.

The crypto market cap surpassed the $950 billion market cap, and with $1 trillion in view, many are drawn back to the pre-FTX era, when the market went over $1 Trillion (it corrected by almost 30% shortly after). Will history repeat itself?

Crypto Market Heatmap | Source: Coin360

Top Altcoin Gainers and Losers

Top Altcoin Gainers

Aptos (APT) ➠ +109.28%

Decentraland (MANA) ➠ +87.99%

Solana (SOL) ➠ +67.81%

Top Altcoin Losers

Fei USD (FEI) ➠ -1.26%

USDD (USDD) ➠ -0.28%

BUSD (Busd) ➠ -0.04%

Fear and Greed Index at 52, Market Sentiment Turns Neutral

For the first time in almost six months, the Fear and greed Index turned neutral. This is a result of the CPI result coming as expected (6.5%) and a sudden crypto rally that ensued.

Fear & Greed Index | Source: Alternative

This Week’s Crypto News Highlights

Nigeria to explore Stablecoin after CDBC failure

After an abysmal showing from its CBDC launch, Nigeria’s central bank is looking to stablecoins and a possible ICO in the next two years. Highlighted in a document titled Nigeria Payment System Vision 2025, the government seeks to harness the power of stablecoins to combat counterfeit currencies, reduce payment inefficiencies, and, most importantly, remove the bottlenecks with remittances.

The 83-page document also covers issues like tax evasion and money laundering and how its failing CBDCs would have been the perfect answer to tackling both. Although the paper claims there are fundraising suggestions for an ICO in the future, the unregulated terrain makes it quite difficult for the central bank to take any more than a brief look into it.

Although the nation's CBDC adoption rate is at a measly 0.5%, the nation’s interest in cryptocurrencies continues to baffle the crypto community and the Nigerian government.

Scam alert: MetaMask warns crypto users about address poisoning

It’s a new year, but old methods for scamming are still being modified. A metamask announcement this week warned wallet holders of a new scamming method where transaction histories are poisoned.

The scam is a particularly insidious and sophisticated attack that sees attackers use vanity address generators to create counterfeit wallet addresses that match the first and last characters of the victim’s wallet address. Then a $0 transaction is initiated and sent to the victim's address. This clever trick gets unsuspecting users to send funds to the wrong copycat address instead of their rightful consumer.

Users are more liable to fall to this scam if they are fond of copying past addresses from transaction histories. MetaMask encourages all its users to double-check the addresses they are sending funds – a few moments of extra care may save them from becoming victims of this scam.

Polygon primed for hard fork aimed at reducing gas fee spikes: New details revealed

To address gas spikes and chain rearrangement issues that have harmed user experience on the Polygon proof-of-stake (PoS) chain, Polygon will undergo a hard fork on January 17.

Following weeks of preliminary discussion on the Polygon Improvement Proposal (PIP) forum page in late December, Polygon formally announced the hard fork event in a blog post on January 12th.

Some of the improvements to be added are that the BaseFeeChangeDenominator function should be increased from 8 to 16 to avoid gas fee spikes. In contrast, the SprintLength function should be decreased from 64 blocks to 16 to address the chain reorganization issue. 87% of the 15 members of the Polygon Governance Team voted in support of the hard fork.

Cardano ecosystem set to expand with custom-built sidechains

Later this month (January), the team behind the Cardano ecosystem will make available a software toolkit that will let programmers create unique side chains on Cardano to enhance the ecosystem.

Input Output Global (IOG), a blockchain engineering firm created by Charles Hoskinson and formerly known as Input Output Hong Kong (IOHK), was announced on January 12. The sidechain toolkit's official technical manual was included in the announcement.

As a "proof-of-concept," IOG engineers have already built an Ethereum Virtual Machine (EVM)-compatible sidechain public testnet using the toolkit. Anyone can launch decentralized applications, produce smart contracts, and transfer tokens between various testing chains after the audit.

Along with additional capabilities tailored to certain applications, the toolkit will allow sidechain developers to select their consensus algorithm.

IOG has already constructed a more straightforward EVM-compatible sidechain in July to start the sidechain development process, so this is not the first sidechain solution IOG has incorporated on Cardano.

Crypto Calendar: Events to Watch This Week

➺ 15/01/2023 - Graphene Airdrop Token Burn

➺ 16/01/2023 - Azbit weekly token Burn

➺ 17/01/2023 - Polygon Hardfork Upgrade

➺ 18/01/2022 - Kyrrex Huobi Global Listing

Bitcoin (BTC/USDT) Technical Analysis

Bitcoin has broken up from an approximate horizontal trend channel in the short term after investors have paid more. A positive signal has been triggered, and a further increase in the currency is indicated. The currency has support at points 17750 and resistance at points 21400.

BTC/USDT Chart on the Daily Timeframe

A positive volume balance, with high volume on rising prices and low volume on days of falling prices, strengthens the currency in the short term. RSI above 70 shows that the currency has strong positive momentum in the short term. Investors have steadily paid more to buy the currency, which indicates increasing optimism and that the price will continue to rise.

Did you know that KuCoin offers premium TradingView charts to all its clients? You can step up your Bitcoin technical analysis and easily identify various crypto chart patterns.