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THE WEEKLY UPDATE
WEEK 12
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Mar 20, 2020 2
YTD Performance as of March 20th, 12:00 CET.
1 Market Update 50%
• Significant boost in the crypto market
• Market sentiment still low – Investors not 40%
confident yet
• Volume pushing to 2019 highs
• Extreme volatility as market retrace 30%
• Bitcoin decoupling from the stock market
• Global instability: Flight to the US Dollar
20%
10%
2 Valuation 0%
-2.23%, Bitcoin
• Bitcoin rebounds strongly this week, but are the (in USD)
bulls in full control yet? The BTC price needs to -10%
cross over an important resistance level
-20%
-26.04%, S&P 500*
-30% -31.67%, EURONEXT (in USD)
3 Blockchain Activity -40% -39.80%, FTSE (in USD)
-41.83%, MOEX (in USD)
• Data show that long-term investors are
accumulating bitcoin after the price crashed last -50%
week January 20 February 20 March 20
THE NEWSROOM
Payments Unicorn Square Gets Limited Bakkt Touts New Payment Integration With Opera now lets US users buy crypto with
Bank Charter for Merchant Lending Starbucks Apple Pay or debit card
Opera was the first browser to introduce Web 3
On Wednesday, the U.S. Federal Deposit Insurance Some users of the Starbucks mobile app are now being
capabilities and a built-in crypto wallet across all of its
Corporation Board (FDIC) gave the payments startup presented with “Bakkt Cash” as a payment option. The
mobile and desktop browsers. The Norwegian company
conditional approval for a bank charter to launch Square move seemingly coincides with the bitcoin derivatives
is now letting its US users easily purchase
Financial Services, an Industrial Loan Company. provider’s long-awaited focus on consumer-facing services
cryptocurrencies using a debit card or Apple Pay.
and the announcement earlier today of a whopping $300
million funding round. .
Mar 20, 2020 4
Significant boost in the crypto market
S&P500 correlation skyrocketing
Top Ten by Market Capitalization Price Last week Last month YTD Bitcoin Correlation:
Bitcoin 6179.64 8.58% -39.09% -14%
ETH XRP GOLD S&P500
90-day correlation
Ethereum 135.52 5.89% -51.92% 4% (weekly change included)
XRP 0.16 2.70% -45.82% -16%
BTC 0.935 0.083 0.895 0.107 0.089 0.002 0.584 0.480
Bitcoin Cash 220.68 29.23% -47.09% 7%
Bitcoin SV 154.53 27.86% -50.19% 59% Source: coinmetrics.io
Litecoin 38.95 17.76% -49.42% -6%
EOS 2.27 7.29% -50.56% -13% Top 3: Percentage Change in Price Over the Last Week
Binance Coin 11.88 3.46% -50.76% -12% 15%
Tezos 1.63 0.46% -52.43% 19%
UNUS SED LEO 0.99 2.10% 0.20% 20% 10%
BTC
5% ETH
Best Performing Last Last week Last month YTD
Steem 0.30 117.50% 17.12% 166% 0% XRP
Hedera Hashgraph 0.04 35.35% -21.56% 294%
Dash 65.70 30.04% -43.22% 50% -5%
Bitcoin Cash 220.68 29.23% -47.09% 7%
-10%
Bitcoin SV 154.53 27.86% -50.19% 59%
-15%
Worst Performing Last Last week Last month YTD
Qtum 1.24 -8.39% -53.03% -22% -20%
Algorand 0.16 -2.78% -52.93% -26%
ChainLink 2.23 -2.71% -50.63% 24% -25%
Ontology 0.38 -2.04% -58.96% -28%
Tezos 1.63 0.46% -52.43% 19% -30%
12 Mar 13 Mar 14 Mar 15 Mar 16 Mar 17 Mar 18 Mar
Last week of top 50 by market capitalization
Source: cryptowat.ch Source: cryptowat.ch
Mar 20, 2020 5Small Caps leading the way as prices turn upwards
Percentage of Total Market Capitalization
BTC ETH BCH LTC XRP DASH NEM XMR IOTA NEO
Market
64.06% 8.47% 2.30% 1.43% 4.03% 0.35% 0.20% 0.41% 0.23% 0.26%
Share
Weekly
0.18% -0.56% 0.35% 0.03% -0.25% 0.07% 0.00% -0.01% 0.01% -0.01%
March has, to say the least, been a rollercoaster in the crypto market.
Change*
After crashing down last week, the market is now really picking up Source: Coinpaprika.com
* Weekly change in percentage points
speed again.
30% Monthly Performance of Market Capitalization Weighted Indexes
▪ Small caps is now “only” down 23% in March and has bounced of the 20%
lows from last week. Last Friday, this index was down over 40%, so this
marks a strong recovery. 10%
0%
▪ Bitcoin is currently closing up on Small Caps, ahead of both Large Caps
and Mid Caps.
-10%
▪ Mid Caps is still struggling, down 35% so far in March. -20% -23.12%
-27.26%
-30%
▪ Bitcoin’s market dominance stays stable, while ETH and XRP are -29.90%
struggling to follow the market leader. -40% -35.78%
-50%
-60%
1 Mar 4 Mar 7 Mar 10 Mar 13 Mar 16 Mar 19 Mar
Large Mid Small Bitcoin
Source: Bletchleyindexes.com
Mar 20, 2020 6Market sentiment stays low – Investors not confident yet?
The Fear & Greed Index stays in the “Extreme Fear” area and is now at 12. Even though the
market has increasing strongly this week, investors doesn’t look too confident just yet.
Extreme Greed
12
100
90
Now Last week Last month
80
Fear (12) Fear (10) Neutral (50)
70
60
50
40
30
20
10
Extreme Fear Source: alternative.me
0
March 19 April 19 May 19 June 19 July 19 August 19 September 19 October 19 November 19 December 19 January 20 February 20 March 20
Mar 20, 2020 7Volume pushing to highest levels since 2019 peak
The 7-day average real trading volume* has more than doubled over
the last week. A lot of bitcoin is changing hands right now with
extreme volatility. The 7-day average daily trading volume is now
getting close to the levels we saw back around the peak in 2019.
3,500
3,000
Trading Volume ($ million)
2,500
2,000
1,500
1,000
500
Real BTC Daily Volume (7-day average)
0
Mar 19 Apr 19 May 19 Jun 19 Jul 19 Aug 19 Sep 19 Oct 19 Nov 19 Dec 19 Jan 20 Feb 20 Mar 20
Source: cryptowat.ch *as defined by Arcane Research. Read more here.
Mar 20, 2020 8Extreme volatility as market retrace from the lows
It’s been a week with large drops and strong retrace for bitcoin. This is without a doubt reflected in the
30-day volatility, which is pushing to new highs. We’re currently seeing a 30-day average volatility of
almost 9%, which is very high, even for bitcoin.
10%
8.9%
9%
8%
7%
6%
5%
4%
3%
2%
BTC-USD Volatility (30-day average)
1%
0%
Mar 19 Apr 19 May 19 Jun 19 Jul 19 Aug 19 Sep 19 Oct 19 Nov 19 Dec 19 Jan 20 Feb 20 Mar 20
Source: cryptowat.ch
Mar 20, 2020 9Bitcoin decoupling from the stock markets?
YTD Performance as of March 20th, 12:00 CET.
▪ Both COVID19 and the sudden supply shock in oil has 50%
led to uncertainty in the global financial markets
40%
▪ All major indexes have nosedived over the past weeks.
30%
▪ As the market priced in the severity of COVID19,
bitcoin crashed. This was in part due to investors 20%
having a risk-off approach due to global uncertainty.
10%
▪ Past the initial crash, bitcoin mirrored the stock market
movements tightly, leading to its highest ever 90-day 0%
correlation with the S&P 500 at 0.584. -2.23%, Bitcoin (in USD)
-10%
-26.04%, S&P 500*
▪ However, the price action of the last couple of days
might indicate that the tide is about to turn. -20% -31.67%, EURONEXT (in
USD)
▪ Bitcoin seems to be decoupling from the stock -30%
-39.80%, FTSE (in USD)
markets as its value returns to the levels of January 1st,
while the stock markets remain stagnant. -40%
-41.83%, MOEX (in USD)
-50%
January 20 February 20 March 20
*S&P 500 data based on close on March 19th.
Source: Yahoo Finance
Mar 20, 2020 10Global instability: Flight to the US Dollar?
▪ Over the last week central banks all over the world have lowered their interest rates and introduced stimulus packages to dampen the negative effects of the COVID-19 crisis.
▪ As the FED lowered the rates to 0%, a paradigm shift regarding fiscal policies might have eclipsed with ZIRPs* becoming the new normal
▪ The forex markets have been extremely volatile this week as small currencies have depreciated dramatically against the US dollar, with investors seeking a “safe haven”.
▪ Bitcoin, however, has had a strong week. An investor would be better off holding bitcoin from Jan 1st till today than holding EUR or GBP in the bank.
Quite remarkable with bitcoin’s recent price crash.
▪ Maybe the turbulence in the financial markets contributes in making investors aware of the value of a scarce, geographically agnostic, decentralized currency with a reliable issuance
policy?
YTD Performance vs The US Dollar, March 20th, 12:00 CET Currency pair YTD Performance
50%
JPYUSD -1.08%
40%
CNYUSD -1.62%
30% BTCUSD -2.23%
20% EURUSD -4.42%
KRWUSD -7.04%
10%
-1.08%, JPY GBPUSD -11.17%
0%
-2.23%, BTC AUDUSD -15.75%
-10% -4.42%, EUR BRLUSD -20.04%
-11.17%, GBP MXNUSD -20.44%
-20%
NOKUSD -20.46%
-30% RUBUSD -22.09%
January 20 February 20 March 20
Source: Yahoo Finance *Zero Interest Rate Policies
Mar 20, 2020 11VALUATION
Bitcoin rebounds strongly, but are the bulls in control?
▪ A crazy week for the bitcoin price, with two weekly
candles we don’t see that often.
▪ BTC has retraced a lot of the brutal crash last
week, and it will be interesting to see if bitcoin
truly is decoupled from the stock market going
forward in these turbulent times.
▪ The current level around $6,600 - $6,800 has been
a support level for the BTC price several times over
the past year.
▪ Will it now act as resistance, or will the price break
above and continue upwards?
Source: Tradingview
Mar 20, 2020 13BLOCKCHAIN ACTIVITY
HODLers are buying bitcoin now
Bitcoin: Holder Net Position Change
▪ Data provided by Glassnode show long-term hodlers are buying bitcoin now.
100 $19,200
Thousands
▪ A metric called the “Hodler Net Position Change” shows the monthly position
change of long-term investors.
0
▪ When the metric is above zero (green), it means that holders on average are
accumulating BTC. $9,600
▪ When this metric is below zero (red), it means that holders are selling and -100
most likely taking profits.
Net Position Change (BTC)
▪ We saw that the metric dipped below zero in February, as holders stopped $4,800
-200
accumulating.
BTC Price
▪ However, over the past week, holders have once again started
accumulating bitcoin. -300
$2,400
-400
On-Chain Bitcoin Activity (7-day average)
$1,200
Last Last week Last month YTD
-500
Transaction Value Adjusted (mUSD) $5,801 7.33% -15.44% 79.92%
Transaction Count 272,830 -15.84% -16.55% -7.57%
Miner Fees (USD) $329,409 43.78% 8.56% 196.74% -600 $600
Mar 17 Oct 17 May 18 Dec 18 Jul 19 Feb 20
Active Addresses 746,747 -0.74% -1.48% 16.54%
Source: Glassnode Data provided by
Mar 20, 2020 15Disclaimer
• “The weekly update” (the report) by Arcane Research is a report focusing on cryptocurrency, open blockchains and fintech. Information published in the report aims to spread knowledge about developments in the market for
cryptocurrencies. All content that is published is for informational purposes only and no content is intended to be a recommendation for making financial transactions or investments. We do not provide financial advice and
are not responsible for readers losses in the market
• We have made every reasonable effort to ensure that the information in the report is accessible, accurate and up-to-date, but subject to technical problems, errors and inaccurate information may occur.
• Investing in cryptocurrency and technology companies involves considerable risk. To understand the risk you are exposed to, we recommend that you perform your own analyzes and seek advice from an independent and
approved financial advisor before deciding to take action. Investments also have tax consequences that you must take responsibility for investigating and living.
• We disclaim any responsibility for expenses, losses (both direct and indirect) or damage arising from, or in any way related to, the use of information in this report. In other words, users are fully responsible for their own
investment activities.
• Arcane Research is a department within Arcane Crypto AS, org. 994 608 673, and can be contacted at research@arcane.no or tbj@arcane.no
Mar 20, 2020 16Subscribe to The Weekly Update Contact: research@arcane.no
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