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Despite last night’s correction, which seems to be undergoing an interesting rebound at the time of writing, it has definitely been another positive week for the cryptocurrency market. Many important milestones were indeed crossed and, to the delight of many patient investors, the altcoins led the market.
Let’s talk about the altcoins first. The vast majority of altcoins saw an interesting surge in their ratio to bitcoin. Among the more capitalized ones, the most interesting to us is undoubtedly Ethereum, which managed to surpass its all-time high in U.S. dollars while bitcoin remained in its consolidation channel. The price per token reached a high of $2,150 USD and remains above $2,000 USD at the time of writing. It should be noted that the fund has taken significant positions in ETH during this climb, adding value to investors through our active management approach.
While the presence north of this cap was short-lived, the altcoins surge also helped surpass the $2T capitalization for the entire crypto market earlier this week. The latter was at US$209 billion just a year ago. Note that bitcoin’s dominance of the market is really starting to recede, although BTC remains the leader by far. Indeed, 73% of the total market capitalization was based on bitcoin at the beginning of the year, while it currently sits at 56%.
This rising overall capitalization has led to impressive thresholds being crossed. Indeed, the crypto market cap now exceeds the value of all public U.S. banks. Despite its declining dominance, bitcoin alone is still worth more than JP Morgan Chase, Bank of America and Wells Fargo combined.
The bitcoin network’s hash rate is also reaching new highs, having hit 179.4 exahashes per second yesterday. Rising prices are indeed allowing miners to fall back into strong profitability territory, so much as ASICs equipment launched as early as 2014 currently still being profitable.
The story of the Winklevoss brothers and their involvement in the creation of Facebook is now part of techno industry folklore. It’s no surprise to anyone that the twins have a beef with the social giant. Seven years ago, when they were jumping into the world of cryptocurrencies, they claimed that bitcoin would one day be bigger than Facebook. While most were laughing at such a declaration then, their prediction is now proving true. Facebook’s market capitalization is $883 billion compared to over $1 trillion for BTC.
Coinbase will officially go public next week. In anticipation of this historic moment for the company, first quarter results were announced this week. In the midst of the bull market, the exchange’s active users soared by 117%. This mind-blowing growth has generated $1.8 billion in the first quarter of 2021, creating a net profit of between $730M and $800M. Verified users – or the total number of people with a Coinbase account – increased from 43 million at the end of 2020 to 56 million at the end of the first quarter of 2021. Transaction volume exceeded $335 billion in the first quarter. For all of 2020, transaction volume reached $193 billion. Finally, total assets on Coinbase’s platform increased from $90 billion to $223 billion, an increase of nearly 150% from the previous quarter.
As Nataniel Whittemore, author at Coindesk, mentions:
In conclusion, a quick traditional weekly mention of Michael Saylor and MicroStrategy. Just this week, $15M of the company’s treasury was converted into crypto, adding 253 BTC to the coffers. These bitcoins were purchased at an average price of $59,339. As of April 5th, the firm has 91,579 BTC purchased at an average price of $24,311.
Despite the correction of the last few hours, the technical picture remains where it has been since the beginning of the year, in dark green territory. There is no need to decipher the most complex indicators these days. The bitcoin price has not closed a single day below the 50-day moving average since October 7th, 2020. It has, however, often used it as a springboard. With the 50-day moving average now at $54,365, this is an important support to watch. The same is true of the $50,000 – $50,500 area. On the bullish side, the price keeps testing the $60,000 mark. Breaking through it would definitely retest the all-time highs and possibly set new records.
Rivemont Investments, manager of the Rivemont Crypto Fund.
The presented information is as of April 7th, 2021, unless otherwise indicated and is provided for information purposes only. The information comes from sources that we believe are reliable, but not guaranteed. This statement does not provide financial, legal or tax advice. Rivemont Investments are not responsible for any errors or omissions in the information or for any loss or damage suffered.
