Bitcoin may have brought the cryptocurrency market to the mainstream investor, but the end of the year was far from stellar.
Through the weekend, Bitcoin failed to make a move back to $15,000 levels, with Friday’s downward trend persisting through to a weekend low of $12,050 before recovering on Sunday to a weekend high of $14,296.06.
In the early part of today, Bitcoin has been relatively range bound, down 0.82% to $13,765.53 at the time of writing, with an intraday low $13,302.02 and high of $13,941.75.
Recent support has come in the wake of some quite adverse news regarding the cryptomarket’s largest, by market share.
The South Korean government was ultimately the horror show for the Bitcoin bulls last week, with the banning of opening accounts anonymously along with the possibility of the government shutting down the cryptoexchanges two major news pieces of the week. There was also a ban on the trading of Bitcoin futures and the government was also looking to ban banks, foreigners and minors from trading Bitcoin. Following on, KB Kookmin and Shinhan banks announced that they will cease offering redemption of credit card points for Bitcoin by mid-month.
News of the North Korean’s hacking a Bitcoin exchange seems to have gotten the South Korean government into panic mode.
Bitcoin may be steady through the early part of the day, but there are plenty of unknowns surrounding the direction of Bitcoin in the coming weeks.
It will ultimately boil down to whether the South Korean government decides to shut down the exchanges and whether other major Bitcoin geographies will follow.
Certainly, if the concern is over North Korea, then Japan could be next. With Japan and South Korea amongst the top Bitcoin trading nations, the loss of one and / or both would be quite an event and something that Bitcoin will unlikely be able to sidestep.
With government chatter on the cryptos on hold today, there will be little damming news to impact the cryptomarkets, which will leave investors looking towards the future and how the cryptomarket landscape could change in the coming year.
Cboe’s Bitcoin futures are sitting in positive territory at the time of writing, with the January contract up $815 to $14,570. The move suggests that the institutional money is less concerned of a major shift in government sentiment towards Bitcoin that could result in the likes of the South Korean and Japanese governments shutting down the exchanges.
For now, Bitcoin investors seem to be taking a more cautious approach at the start of the year and perhaps wisely, with more news from the South Korean government likely through the week.
We wouldn’t expect any major sell-off today, with futures prices providing some support. Trading volumes are on the lower side however, which is to be expected and that should prevent any rallies, with Bitcoin needing to catch up with its futures price before the cryptomarkets will consider what’s next.
Whatever is said about Bitcoin, it’s not been a bad year, with Bitcoin gaining 1,311% since the beginning of January last year. It may pale into insignificance when compared with the likes of Ripple, but if you’re looking at the equity markets, which many new cryptocurrencies will have been exposed to, the move across was to the cryptos was a wise one.
For Bitcoin’s peers, it’s been a better 1st January for Bitcoin Cash, Bitcoin Gold and Ethereum, though the gains have been minor and few are likely to be jumping in until the news feeds start getting busy with government chatter through the week.
At the start of 2017 things started pretty slowly for the cryptos and today is not too dissimilar, though following exponential gains last year, which crypto will be the trailblazer through the year will be the question on everyone’s minds and Ripple certainly looks to be the favourite amongst the front runners for now.