Market Wrap: Bitcoin Bounces From $13.2K; Ether on Centralized Exchanges at 2-Year Low

Bitcoin's price is trending up after a dip while traders are moving ether off from centralized exchanges.

AccessTimeIconNov 2, 2020 at 9:35 p.m. UTC
Updated Apr 10, 2024 at 2:29 a.m. UTC
10 Years of Decentralizing the Future
May 29-31, 2024 - Austin, TexasThe biggest and most established global hub for everything crypto, blockchain and Web3.Register Now

Bitcoin opened the week recovering from a dip while ether balances on centralized exchanges fell.

  • Bitcoin (BTC) trading around $13,673 as of 21:00 UTC (4 p.m. ET). Slipping 1.2% over the previous 24 hours.
  • Bitcoin’s 24-hour range: $13,221-$13,877
  • BTC above its 10-day but below the 50-day moving average, a sideways signal for market technicians.
Bitcoin trading on Bitstamp since Oct. 31.
Bitcoin trading on Bitstamp since Oct. 31.

Bitcoin’s price dipped as low as $13,221 at around 12:00 UTC (7 a.m ET), according to CoinDesk 20 data. It subsequently rebounded up to $13,673 as of press time.

“It's interesting to see that today, as the S&P and gold price rose, BTC dropped in today's market open,” said Andrew Tu of Efficient Frontier, a crypto quant trading firm. “In recent weeks, we have been seeing BTC price diverge from the equities market.” 

Bitcoin’s 90-day correlation, where zero means no mutual relationship, has been dropping since Oct. 18. 

Bitcoin’s 90-day correlation to the S&P 500 index in 2020.
Bitcoin’s 90-day correlation to the S&P 500 index in 2020.

“If this becomes a long-term trend, this could be a very positive sign for BTC should the equities market continue to correct over the medium to long run,” Tu added. Equities are faring quite well Tuesday, with major indexes were in positive territory.

However, the optimism in equities may not last. “Markets are likely to be unpredictable during the U.S. elections and any unexpected shocks to the system could cause the type of mass sell-off in traditional assets that has in the past brought digital assets down as well, though those dips tend to usually be only temporary," cautioned Guy Hirsch, U.S. managing director of multi-asset brokerage firm eToro. 

Bitcoin volumes for Monday on major spot exchanges totaled $490 million as of press time, much higher than the past month’s average of $257 million and closing in on this past Monday’s $502 million total. 

Major exchange USD/BTC volume the past month.
Major exchange USD/BTC volume the past month.

However, higher volume than this past month’s average is not translating into major price action Monday with an uncertain U.S. presidential election looming Tuesday, Nov. 3.

“This is the calm before the storm,” said David Lifchitz, chief investment officer of ExoAlpha. “Most investors remain prudent and don't want to take a bet on an event whose outcome is binary: Will there be panic selling or a relief rally on Nov. 4?” 

Options traders see a 51% chance bitcoin is over $13,000, a 42% probability of the price of BTC over $14,000 and a 27% chance of surpassing $15,000 for November expiration. 

Probability of BTC prices based on options for November expiration.
Probability of BTC prices based on options for November expiration.

Crypto could see some big movements once there is some clarity on the election and pent-up capital is unlocked, added Zachary Friedman, chief operation officer of trading firm Global Digital Assets. “Right now, pre-election, capital is staying sidelined in a wait-and-see fashion.”

Ether on exchanges drops

Ether (ETH), the second-largest cryptocurrency by market capitalization, was down Monday, trading around $387 and slipping 1.8% in 24 hours as of 21:00 UTC (4:00 p.m. ET). 

The amount of ether in reserve, or held by major centralized exchange addresses, a metric calculated by data aggregator CryptoQuant, has dropped to 11,628,046 ETH, a low not seen since Aug. 14, 2018. 

Ether reserves in major exchanges addresses since 2018.
Ether reserves in major exchanges addresses since 2018.

One factor for the decline, according to Denis Vinokourov, head of research at digital asset prime broker Bequant, is the rise of decentralized exchanges, or DEXs, and the proliferation of liquid cryptocurrency pairs on those venues. 

Liquidity on Uniswap the past six months.
Liquidity on Uniswap the past six months.

“The number of currencies available to trade on DEXs rose to 8,000 in October versus 1,500 in early January,” Vinokourov noted. “The top venue that is Uniswap now commands liquidity of close to $3 billion, which is actually an increase from the levels observed in September.”

Other markets

Digital assets on the CoinDesk 20 are mostly red Monday. One notable winner as of 21:00 UTC (4:00 p.m. ET):

  • 0x (ZRX) + 0.32%

Notable losers:

Commodities:

  • Oil was up 3.8%. Price per barrel of West Texas Intermediate crude: $37.09.
  • Gold was in the green 0.95% and at $1,895 as of press time.

Treasurys:

  • U.S. Treasury bond yields were mixed Monday. Yields, which move in the opposite direction as price, were up most on the two-year bond, jumping to 0.160 and in the green 5.1%.
The CoinDesk 20: The Assets That Matter Most to the Market
The CoinDesk 20: The Assets That Matter Most to the Market

Disclosure

Please note that our privacy policy, terms of use, cookies, and do not sell my personal information has been updated.

CoinDesk is an award-winning media outlet that covers the cryptocurrency industry. Its journalists abide by a strict set of editorial policies. In November 2023, CoinDesk was acquired by the Bullish group, owner of Bullish, a regulated, digital assets exchange. The Bullish group is majority-owned by Block.one; both companies have interests in a variety of blockchain and digital asset businesses and significant holdings of digital assets, including bitcoin. CoinDesk operates as an independent subsidiary with an editorial committee to protect journalistic independence. CoinDesk employees, including journalists, may receive options in the Bullish group as part of their compensation.


Learn more about Consensus 2024, CoinDesk's longest-running and most influential event that brings together all sides of crypto, blockchain and Web3. Head to consensus.coindesk.com to register and buy your pass now.