According to Simon Peters, market analyst at eToro, Bitcoin (BTC) and Ethereum (ETH) prices could move nervously in the coming days.
In fact, important data are expected to come in, especially from the US and UK, which could affect the crypto markets.
Interest rates: the movements of Bitcoin and Ethereum according to eToro
The main expectation is for Wednesday, 20 September, when the Fed will announce its latest decision on interest rates.
Truth be told, virtually everyone expects that it will not raise them this time, and it is hard to imagine that things could realistically go otherwise.
As is often the case, markets have already priced in the possible decision, but have not yet been able to price in what Governor Powell will say at the press conference. Typically, what moves the markets are generally his words, spoken after the announcement of the rate decision, rather than the announcement itself.
The British central bank will also announce its rate decision, but it may be different.
Right now it seems that traditional markets have no certain direction, and may begin to move unpredictably depending on the data that come in. The crypto markets could follow.
As a risk-on asset, cryptocurrencies are sensitive to rate expectations, and any tightening in tone could drive investor sentiment into the bearish area.
Bitcoin and Ethereum: eToro’s analysis
Meanwhile, while waiting for this data, Bitcoin’s price has returned to the level around which it has in fact been hovering since March, namely $27,000.
Since the beginning of the year it has been above this threshold a first time, in April, and then back below it a first time, in June. It later returned above but only to go back below again in August.
In other words, it has already posted two ups and downs only to finally return to the starting point of the 17 March.
For Ethereum, on the other hand, the matter is a little different, because the level around which it has been oscillating for months is $1,800. With today’s increase it has just managed to get back to $1,650, although the percentage gain since yesterday is only slightly less than that of Bitcoin.
The fact is that in June, when Bitcoin’s price went up thanks to news of BlackRock’s spot Bitcoin ETF, Ethereum’s price went up less, so the August decline for ETH started from a lower level.
Last week’s gains were really modest, although recovering from the small drop at the beginning of the week, while today they are more significant.
Bitcoin outperforms Visa
Beyond the more purely speculative aspects, it should be noted that, according to Reflexivity Research, the annual volume of transactions on the Bitcoin network has surpassed that on the Visa network for the first time in its history.
It is worth mentioning, however, that BTC’s overall on-chain transaction volume also includes the technical movements of exchanges, and thus is not perfectly comparable to Visa’s, which includes only card payments.
In addition, the average volume per transaction on the Bitcoin network is very high (nearly $5,000), because huge transactions are often made. In contrast since these are common payments, on Visa network the average volume per transaction is much lower.
However, this gives a good idea of the use of Bitcoin, which is often used for making large transactions, rather than for everyday payments instead.
It should not be forgotten that this does not directly affect the price, partly because many of these transactions are not purchases and sales, but simple transfers of funds from one wallet to another.
It should be noted that the annual volume of transactions on the Bitcoin network has increased steadily over the past decade, so much so that if it continues like this in the coming years it could even come to rival the high-level settlement systems used by the government.
Ethereum: problems with Holesky
As for Ethereum, on the other hand, there have been problems with the new testnet Holesky, which failed to launch after a technical problem delayed its release.
It is worth noting, however, that this is an unnecessary network used only for testing, so the impact on ETH’s price simply was not there.
The new testnet was supposed to debut on Friday, which is exactly one year after the Merge, but the launch was canceled at the last minute precisely because of technical problems.
Holesky is set to become the testnet for the upcoming Dencun hard fork, which will launch new features to help expand the Ethereum blockchain.
However, even in the case of problems with Holesky, the developers have assured that there will be no obstacles to the final launch of Dencun.