Cryptocurrency News

BTC price doesn’t care about El Salvador? 5 things to look for in bitcoin this week

bitcoin (B T c) starts another week below $40,000, but with two major new destinations under its belt.

Bitcoin adoption has also seen unexpected firsts — from El Salvador and Paraguay — after FUD continued to pour in from China over the weekend.

The world is potentially congratulating its first two “Bitcoin nations” in history, there’s a lot to be said about it, but can BTC price action catch up?

Cointelegraph takes a look at five things that could change the status quo in BTC/USD in the coming days.

High Interest Rates “Good” Says Yellen

A cursory glance at the broader macro climate provides an interesting mix for bitcoin traders and traders.

Inflation in the United States is still the talk of the town, with Treasury Secretary Janet Yellen revealing she would favor higher rates.

Speaking To Bloomberg over the weekend, Yellen voiced support for President Joe Biden’s latest massive spending package, arguing that it should be given credibility, even if it results in inflation.

“If we end up with a slightly higher interest rate environment it would really be a plus for society’s view and the Fed’s view,” she told the publication.

Higher interest rates improve bitcoin’s appeal as a deflationary asset, but accompanying them is the rise in the US dollar this month – something that has traditionally put pressure on BTC/USD.

After a surge of 90, the US Dollar Currency Index (DXY) is now busy building lost ground, bucking the downtrend that began in mid-March.

US Dollar Currency Index (DXY) 1-Day Candle Chart. Source: TradingView

El Salvador, Paraguay Fail to Reverse Bitcoin Bullies

Within bitcoin, everyone has the word “El Salvador” on their lips.

After the payment gateway strike made serious inroads into the country, President Nayib Bukele formally announced that he would send a bill to parliament to make bitcoin legal tender.

Should it succeed, El Salvador will be the first nation on Earth to do so, effectively adopting something similar to the “Bitcoin standard”.

Bukele confirmed his plans during a video address at last week’s Bitcoin Conference 2021 event in Miami, in which Strike CEO Jack Mallers outlined the plans.

However, the markets were practically unaffected by this revelation – something that persisted as a Paraguayan congressman took to social media to hint at plans for bitcoin integration into another world economy.

“As I was saying long back, our country needs to move along with the new generation. The moment has come, our moment,” Carlitos Rezala tweeted on Monday.

“This week we begin with an important project to innovate Paraguay in front of the world! Real to the moon.”

Regala also thanked Bukele for his “example”.

as Cointelegraph ReportedHowever, El Salvador’s adoption of bitcoin may come at a cost. Responding, commentators touched on potential early troubles arising from Bukele’s authoritarian leadership, as well as an economy that uses the US dollar to do so.

For Caitlin Long, founder and CEO of Avanti Bank, bigger forces may be at play.

“Bitcoin is hacking dictatorship, just like it is hacking big technology,” he wrote In one of the many tweets about the move.

“Bitcoin doesn’t care why the President of El Salvador wants to make BTC legal tender – it doesn’t matter.”

Shorts Mount in Classic Bear Signal

Watch the immediate price action and anyone would be forgiven for having a cold foot on bitcoin on Monday.

For all the excitement of the conference, BTC/USD is strongly range-bound and there is a run of higher highs and higher lows that could signal a breakout.

Recent attempts to do so – by escaping a narrow “compression” wedge where the volatility trend has dropped to almost zero – have all come to a halt.

At the time of writing, bitcoin was trading slightly above $36,000.

with funding rates being lessPositive signs were visible in some segments of the market, but others are already sounding the alarm.

Short trades on the major exchange Bitfinex are a cause for concern. As popular Twitter account Fomocap noted on Monday, the rise in bears has historically coincided with great volatility – usually on the downside.

“Bitfinex sudden short move always means something. A drop from November 25 to May 19,” he warned.

“It’s on the rise again.”

Bitfinex Shorts vs BTC/USD Annotated Chart. Source: Fomocap/Twitter

This will cement existing fears that Bitcoin is not yet done with its bearish return. Opinion is divided, as Cointelegraph Reported – Some await a return of $20,000, while others are convinced that such levels are out of reach for good.

Ethereum Eyes “Parabolic” Move Vs BTC

Bitcoin’s pain could still be an altcoin’s gain.

Despite the decline in the crypto market cap, some cryptocurrencies are continuing their upward move, with hopes that an opportunistic “alt season” may still emerge.

Of particular interest this week is ether (ETH), reaching a recent local high of 0.081 against bitcoin over the past month.

Currently at 0.076, ETH/BTC may be ready for another breakout. Three Arrows Capital CEO Kyle Davis went even Description Incoming move as “parabolic”.

“If we hit .2 on both assets without making USD to an all-time high, I’m not going to bother with crypto anymore,” said Blockfolio’s UpOnly chat show host Kobi replied, capturing the general feeling of dismay among traders with the current price action.

ETH/BTC reached its all-time high of 0.123 in early 2018 and has since failed to reach those levels.

ETH/BTC 1-Week Candle Chart (Bitstamp). Source: TradingView

On Monday, most of the top fifty cryptocurrencies by market cap saw modest gains with bitcoin weakening, while some outperformed, including Solana (p) with 10% return and Tezos (XTZ) with 12%.

businessman josh rager this kind of experience About SOL’s prospects on Sunday.

Highest outflow of miners phase 2021

Bitcoin’s hash rate is showing signs of recovery, a slight lift From 125 exhash per second (EH/s) to 134 EH/s in recent times.

Difficulty is still down by about 8% at the next automatic readjustment in five days’ time, which compensates for a miner shake-up with recent volatility.

Still, the once confident miners who took the plunge reduced their holdings. collectively Last week, the data shows.

As noted by the analyst William Clemente, the miner balance dropped by 5,000 BTC compared to a week ago – a major change.

On June 3, 3,012 BTC left the largest mining pool Poolin, the largest single outflow of 2021. A day later another 2,501 BTC were moved.

Comment, however, analyst lex moskowski Acknowledged that the sale of funds may not have ended.

“It’s not a song to sell, even if this day see 3x outflows like this,” he tweeted.

Minor BTC Balance Chart. Source: William Clemente / Twitter