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The market is active and constantly changing

Jan 7, 2019

The first week of the year will be remembered for the unexpected change of positions in the TOP-3 cryptocurrencies by capitalization. Ethereum (ETH) shifted Ripple (XRP) from the second position, adding more than 11% in value. At the same time, Bitcoin (BTC) and Ripple (XRP) slightly declined over the same period.

Capitalization of Ethereum (ETH) exceeded $16 billion. The weekly high was set at $167, after reaching the low of $132 before.

Such a powerful growth was due to the expectation of the appearance of a fundamental factor. It is well-known that the expectation of an important signal can have a strong impact on the price of cryptocurrencies.

In this case, the hard forks of Constantinople will lead to the growth of the ETH.

The main positive changes for Constantinople (ETH hard fork) may be a 18-month postponement of the so-called “complexity bomb”, which facilitates upgrades, as well as a decrease in the miner’s reward from 3 to 2 ETH for one unit.

BTC Correlation with Gold and VIX Fear Index

Paul Vigna, a Wall Street Journal cryptocurrency expert, noted an increase in the correlation between changes in prices for gold and BTC. This might happen because Bitcoin is starting to function as a “protective asset” in an unstable situation in the US stock market.

After studying the data of the analytical company Excalibur Pro, Vigna stressed the correlation between BTC and gold at the level of 0.84. Slightly lower is the correlation between price changes for BTC and the fear index VIX 0.77.

Given the increased correlation of these instruments, it can be assumed that a further decline in major US stock indices will enhance the growth of BTC and other TOP-10 cryptocurrencies. This trend may happen due to the fact that part of the capital from the stock market migrates to the cryptocurrency market. But the lack of a convenient tool for institutional investors still makes the cryptocurrency market unattractive for large investors from Wall Street.

The emergence of this investment tool, for example, a BTC ETF, can lead to abnormal growth of most cryptocurrencies.

The following  Ethereum code changes will refer to miners

Ethereum developers have reached a preliminary agreement on updating the code base of the platform. This update will block mining on ASIC devices. Martin Holst Swende, security chief of Ethereum, noted the presence of vulnerabilities. Therefore, he wants to update the code as soon as possible.

Hudson Jameson, Ethereum head of public relations, also ensures a preliminary agreement on ProgPoW implementation. Therefore,  ETH may grow in the nearest future.

EtherGoo application switched to Tron blockchain

The news that the favourite decentralized game EtherGoo has switched from Ethereum to the Tron blockchain has given strong support for cryptocurrencies. According to CoinMarketCap, Tron (TRX) remains the growth leader among the TOP10 cryptocurrencies in terms of capitalization.

Litecoin (LTC) added more than 23% in the last 7 days, during the same period Tron (TRX) increased by 17.1%, and Ethereum (ETH) closed the top three with a growth over 14%.

There were no obvious fundamental factors for the strong growth of Litecoin (LTC) last week. However, growth occurred after OKEx launched perpetual swaps for Ethereum (ETH) and Litecoin (LTC). Perhaps this allowed LTC buyers to resume growth, pushing off from the technical support level and exit the consolidation zone.

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