Weekly Market Wrap: Deutsche Bank’s crypto move propels Bitcoin to US$26,750
Bitcoin rose 3.08% from Sept 8 to Sept. 15, to US$26,625 as of 6:45 p.m. Friday in Hong Kong. The world’s largest cryptocurrency by market capitalization has been trading below US$30,000 since Aug. 9, according to CoinMarketCap data. Ether, the world’s second-largest cryptocurrency, rose 0.21% over the week to US$1,628.
German banking giant Deutsche Bank partnered with Swiss crypto firm Taurus to offer Bitcoin and crypto custody solutions to institutional clients, the Swiss firm announced on Thursday. This means that for the first time, the US$1.3 trillion asset manager will be able to hold a limited amount of crypto on behalf of clients and offer tokenized versions of traditional financial assets.
Bitcoin rose to a weekly high of US$26,750 on Friday, bolstered by the announcement from Germany’s largest lender, according to Phillip Lord, president of the crypto payment app Oobit.
“The trend towards more product launches and more geographical diversity in relation to cryptocurrencies is a fact, it is happening, whether in the Lion’s City, El Salvador, Germany, or the U.S.”
“Markets always do what they are poised to do, but never when. Hence, while we are optimistic about seeing the US$30,000 barrier soon, we wouldn’t make a clear projection that this would happen in the second half of September,” added Lord.
Last Friday, the U.S. Securities and Exchange Commission (SEC) appealed July’s summary judgment that said Ripple’s XRP sales to institutional investors violated securities laws, but sales on public exchanges to retail investors did not.
“It seems that the SEC is quite unhappy with the summary judgment and is trying to exhaust all means to get a ruling in its favor,” Jonas Betz, crypto market analyst and founder of consultancy firm Betz Crypto, told Forkast.
“It is a common legal procedure to try to challenge decisions, but in my opinion, it will come to nothing in this case. The XRP token may see higher volatility in the coming weeks, but a broad decline in investor sentiment is unlikely.”
While the SEC’s appeal didn’t come as a surprise, investor confidence took a hit, with Bitcoin falling to a weekly low of US$25,060 on Monday, three days after the agency’s legal action.
Tuesday brought positive developments for investors, after Standard Chartered’s crypto custody arm, Zodia Custody, launched services in Singapore for financial institutions.
Standard Chartered’s move indicates growing institutional acceptance towards crypto, according to Manuel Ferrari, the co-founder of Money On Chain, the first Bitcoin-backed stablecoin protocol on Rootstock.
“This move could potentially signal the start of a growing trend for more large institutions to enter the market. As one of the world’s leading financial institutions, Standard Chartered’s entry into the crypto space lends credibility and legitimacy to digital assets,” wrote Ferrari, in a statement shared with Forkast.
The same day, Franklin Templeton, a holding company with US$1.52 trillion in assets under management, filed for a spot Bitcoin exchange-traded fund (ETF) application. This only brought temporary relief for investors, considering that the SEC delayed the decision on several such ETF applications, including the ones from BlackRock and WisdomTree.
Two days after the news, Bitcoin recovered to US$26,529 on Thursday, which could pave the way to more upside momentum in September, according to Kadan Stadelmann, chief technical officer of blockchain infrastructure development firm Komodo.
“There is a growing sentiment that Bitcoin could rally back above US$30,000 in the coming month,” wrote Stadelmann.
However, Ferrari expects Bitcoin’s recovery to be short-lived.
“The recent rebound in Bitcoin’s price has set the stage for a temporary bounce in price, likely to the US$28,000 level. That will likely be short-lived, however, as Bitcoin is likely to experience further downward pressure in the coming months,” wrote Ferrari.
On the macroeconomic front, the release of the U.S. consumer price index (CPI) showed that inflation posted its biggest monthly increase this year, rising 0.6% for August and 3.7% from a year ago.
Notable movers: BCH, RUNE
Bitcoin Cash was this week’s biggest gainer in the top 100, rising 13.23% to US$217.14. The token started picking up pace on Tuesday as the wider crypto investor sentiment was improved by the launch of Standard Chartered’s crypto custody wing.
Rune, the native governance token of the ThorChain network, was this week’s second-biggest gainer, rising 11.53% to US$1.75. The coin started picking up momentum on Wednesday and has been receiving increased investor interest since lending went live on the protocol on Aug. 21.
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Next Week: Can Bitcoin reclaim US$30,000 in September?
Bitcoin’s double-bottom technical formation, which printed its first leg down on June 15 and the second one this week, is a bullish sign for the short term, according to Lucas Kiely, the chief investment officer of digital asset platform Yield App.
“While Bitcoin is likely to trade lower in the coming months, the double bottom signals a short-term bullish trend for Bitcoin. If Bitcoin manage to close the week above the resistance of approximately US$25,000, it signals strong short-term support,” wrote Kiely, adding that Bitcoin could see considerable bullish momentum if it returned to US$30,000 in September.
In the macroeconomy, investors will be looking forward to the Federal Reserve’s next interest rate decision on Wednesday. The CME FedWatch Tool predicts a 97% chance the central bank will maintain the current rate unchanged in September, up from 92% one week ago. It gives a 67.2% chance for another pause in November.
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