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Daily Bitcoin and Crypto Analysis

September 27 Daily Crypto Update: BTC is now already halfway back up

September 27, 2021

Justin d'Anethan

There’s only so much impact the same news can have on investors’ minds. I’m thinking of Evergrande but also, for the crypto community, the Chinese ban that was announced over the weekend.

In traditional markets, with the risk of Evergrande’s default still present but somewhat digested and the idea that (in the US) the Fed continued their accommodative stance, risk assets were bought on Friday last week and in futures trading on Sunday evening. Equities rose, the 10-year yield is back above 1.4%.

In the crypto space, there was a sharp drop over the weekend after China announced it would make all crypto transactions illegal - a narrative that sounded broader and more decisive. It’s fascinating to see how little effect it’s had a day later and how buyers are once again taking control.

After dropping from essentially 45K and all the way to 40K, BTC is now already halfway back up, at $43,000. 

The BTC Dominance index, while slightly higher, remains around or close to 41.80. That suggests that investors didn’t panic, didn’t rush back to the relative safety of BTC, and held onto their diversified portfolio. Within alts, though, you can see a mixed performance.

A lot of the DeFi stuff is outperforming with UNI leading the charge after a 20% gain. ETH, AAVE, MKR are also outperforming BTC with gains of 3% to 6%. 

We do see underperformers, though, like DOT, ADA, or XTZ, all falling about 4-5%.

Speaking of impactful news that came through in the past few days, I think a very noteworthy one is FTX moving its headquarters from Hong Kong to the Bahamas, citing concerns about excessively harsh quarantine rule that makes international business impossible. But, of course, one suspects that the Chinese ban and regulatory environment in HK might be the real cause.

On that note, we also hear of Huobi, looking to soon halt any activity in Mainland China. 

While China is busy doing everything it can to keep capital from flowing out and deal with its financial issues, other countries are marching on. One of the countries doing the most is El Salvador, where more than 2.1 million people actively use crypto wallets and cryptocurrencies.

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