This week, the price of the largest cryptocurrency, Bitcoin, remained subdued and stuck under $30,000, even falling briefly below $29K to its lowest level since June. And as of writing, BTC/USD has been trading at $29,163, while ETH is exchanging hands at $1,850.
BTC first surged past $30k about a month ago after the traditional finance (TradFi) giant BlackRock filed an application for a Bitcoin ETF, which spurred speculation that if the world’s largest asset manager wins regulatory approval, it could funnel billions of dollars from traditional investors into the digital asset. But the crypto asset has lost bullish momentum since then and is now trading in the red.
As investors took profits, Bitcoin volatility has also dipped to its lowest level in a year while eyes remain on the Federal Open Market Committee (FOMC) meeting. The 30-day estimate for BTC volatility has fallen to its lowest level since earlier this year to just 0.74%.
The latest loss in Bitcoin’s price came ahead of the Federal Reserve’s latest two-day monetary policy meeting on Wednesday. The US central bank will likely raise interest rates by 0.25% today.
However, Bitcoin has been having a diminished reaction to macroeconomic events, with the two most recent rate hikes in May and March resulting in relatively mild price moves of 1.13% and -2.87%. Moreover, it is likely crypto markets have already priced in the anticipated move.
With the price of Bitcoin below its 20-day moving average, traders are eyeing an upside target of a psychologically important $30,000 level, which coincides with its 20-DMA, also an area of high volume.
Meanwhile, crypto data provider Santiment noted that Bitcoin’s supply on exchanges continues to move into self-custody, with the 1.17 mln BTC balance on exchanges being the lowest level since Nov. 2018. Additionally, the drop below $30k last week did not trigger any severe reactions that would indicate FUD (Fear, uncertainty, and doubt) or more upcoming sell-offs, so we may see an upside to $30K.
This loss of momentum could actually also be seen in the flows of Bitcoin investment products which saw a $13 million outflow last week after consecutive weeks of massive inflows. Investors seem to have shifted their focus on altcoins, with ETH-focused investment products enjoying the largest inflows at $6.6 million, suggesting that “sentiment, which has been poor this year, is beginning to turn around,” noted CoinShares’ James Butterfill.
XRP funds also experienced $2.6 million of inflows, implying “investors are increasingly confident in the outlook” for the digital asset. Other crypto assets that saw inflows include Solana (SOL), with a $1.1 million inflow, and Uniswap (UNI) and Polygon (MATIC), which saw an inflow of $0.7 million each.
Dogecoin, however, is the one that emerged as the winner amidst Bitcoin’s continued weakness. The meme coin hit nearly $0.0840 on Tuesday after seeing a 10% jump in price which is its biggest single-day gain since April 3. This took DOGE to a level not seen since April, amidst Elon Musk’s rebranding of Twitter as X.com. Musk has always taken a special interest in DOGE and other meme coins, which has pumped the coin’s price in the past. So, now with Twitter’s overhaul, the market could see it broadening the use of Dogecoin.
Doge’s gains came with an increase in activity in the perpetual futures market. The notional open interest (OI) for DOGE perps topped the $500 million mark for the first time since April 19, according to Coinglass. While OI in USD terms more than doubled in two weeks, it surged to 6.2 bln in DOGE, nearing the peak of 6.43 bln reached on April 8. This increase in OI, combined with a rise in price, led to the recent uptrend.
Besides DOGE, this past week has been good for Maker, which usually ends up being bad for the broad crypto market. Interestingly, as MKR price surged to near one-year high above $1,200, 110% since June 10, VC giant Andreessen Horowitz (a16z) sold a part of its investment in crypto lender MakerDAO’s MKR governance tokens.
A16z, which was MakerDAO’s one of the largest investor and purchased 6% of MKR’s supply for $15 million in Sep 2018, transferred about $7 million of MKR to a freshly created address which then began depositing tokens to Coinbase.
Besides these altcoins, stablecoin Tether (USDT) is also enjoying an uptrend of sorts. The market cap of the largest stablecoin reached a new all-time high (ATH) of $83.76 bln, according to crypto data provider IntotheBlock.
In early last month, the USDT market cap reached its previous high from May 2022. Despite initially struggling to maintain this level, it has now confidently established a new peak. “This shows that despite regular FUD, USDT continues to validate its position as a trusted stablecoin,” noted IntoTheBlock.
THETA Token Gaining Traction
Against this backdrop, the 50th largest cryptocurrency with a market cap of $832 million, THETA, jumped 1.5% in value to now trade at $0.830, as per CoinGecko. With this, Theta’s 24-hours trading volume increased by 97.80% from a day ago to record $40 million in market activity.
Having crossed 20 and 50-day EMA, THETA price indicates rising bullish momentum with Chaikin money flow score at 0.04, also implying that the price has strength. But a sharp decline in CMF suggests that bears have started to enter the market to halt the bullish move. As for the relative strength index (RSI), it is trading at 56.52, again showing bullish momentum.
On the upside, THETA has the next resistance level at $0.88 and then $0.94. If the greens persist, the digital asset could easily rise above $1 with a strong influence of bears present at the annual high of $1.302. Meanwhile, on the downside, the price has formed support at $0.755, then the $0.70 level, and then $0.62. For now, the price has entered into a consolidation zone ranging between $0.755 and $0.83.
While this week has been a volatile one, THETA has been on a broad upward trend since mid-June, during which its price increased by 34% following a 49% drawdown over a two-month period.
2023 has been a year of recovery for the crypto asset, as seen across the crypto market, as THETA price rallied 77% in the first two months before falling 31% between February 21 and March 10 and the subsequent nearly 40% upside in April. THETA price is still up 14.5% in 2023 so far but down 28.5% over the past year.
The lowest the price of THETA ever went was $0.040 in Mar 2020, which means its current price is 1,963% higher than the all-time low price. However, the price has lost 94.7% of its value since hitting ATH at $15.72 in April 2021.
THETA is the native token of the Theta Network, which aims to usher video content into Web3 and create a new paradigm for how we interact with video content.
During the bull market of 2021, THETA saw American pop singer Katy Perry launching NFTs on its platform and acquiring a minority stake in Theta Labs alongside her talent agency, Creative Artists Agency, which also became a Theta Validator, joining the likes of Sony, Samsung, and Google.
The token has a fixed supply of 1 billion, all of which are circulating in the market. Users stake their THETA tokens to validate transactions on the network and are rewarded with new Theta fuel tokens (TFUEL), which are staked on the Theta Edge Network with rewards paid out in TFUEL.
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Theta Network Expansion & Future Plan
Theta Edge Network is a decentralized data storage and sharing blockchain network that provides the core value to the entire project by allowing users to upload and share video and live stream content without a centralized server. Users can share their unused bandwidth to help relay video on a peer-to-peer basis in exchange for receiving rewards.
The streaming service model aims to disrupt the traditional video streaming industry and capture market share from the likes of Netflix and Hulu. The network supports THETA.tv, which is available on Samsung mobile devices.
THETA was created by Theta Labs, which was founded by Mitch Liu and Jieyi Lon, and has raised a total of $113 million in funding over five rounds. Theta Labs’ team is made up of former employees from Netflix, Samsung, Amazon, and Vimeo.
The network uses a new proof-of-stake (PoS) consensus mechanism, which is described as “an aggregated signature gossip protocol” where new blocks are proposed and finalized by a small number of “validator nodes” that are run by its corporate council members. On top of it, a second layer of nodes called “guardian nodes” seal blocks.
Over a year ago, Theta Labs announced that it would launch a “Theta Metachain” in December 2022 so that anyone can build a “subchain” and plug it into the main blockchain without needing permission from the company. As per the company’s revised roadmap, Metachain partners will go live on Mainnet in Q3 of 2023.
Last week, the leading purpose-built blockchain for video, media, and entertainment partnered with 1990s milk cap game company Pogs, which has worked with top brands like Pokemon, Disney, and Barbie over the past three decades.
Rebranded as Pog Digital, the company is pursuing web3 ambitions, and according to them, its 165 million millennials and Gen Z user base “will want to own a modern iteration that integrates digital and physical experiences.”
“By partnering with Theta Labs, we are able to scale a dedicated ecosystem while connecting our collections across multiple blockchains such as Solana, Ethereum, and Bitcoin,” said Pog Digital CEO Kyler Frisbee in a statement.
Earlier this year, Theta Network also partnered with FedML, a Collaborative/Federated Machine Learning and Edge AI Platform that allows users to build and connect AI applications anywhere at any scale. Powered by the Theta edge network, the collaboration enables the deployment of AI and ML at a distributed, global level.
Besides facilitating collaborative training of large-scale generative AI models on the datasets of participating users, it enabled Theta TV community members to contribute their personal preferences and compute resources to train and deploy AI models while being rewarded for their contributions.
Now, for the year ahead, the Theta Labs team is working on Theta Video API, self-serve NFT DRM support for live streams, decentralized transcoding of live streams, next-generation Theta Edge Network, distributed NFT storage, new computational jobs, and support for TNT20 token rewards. Before the year is over, the team further aims to release EdgeStore with jobs and a payload marketplace along with an API interface for developers coming in 2024.
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