Official data confirms US recession with Bitcoin price falling to $19K
Bitcoin ( BitcoinTC), wobbled in its narrow trading range on Sept. 29, Wall Street Open, as official data placed the United States economy into recession.
BTC/USD 1-hour candle charts (Bitstamp). Source: TradingView
The U.S. meets the technical definition of recession
Data from Cointelegraph Markets Pro, and tradingView show that BTC/USD hovered just above $19,000 as of the writing.
The pair survived the gloomy statistics for the United States with the second quarter gross national product (GDP), growth of -0.6%. Despite protestations from the White House, this meant that the U.S. had met the standard criteria of recession, with two consecutive quarters without growth.
“Everyone talks as though recessions should never happen,” financial commentary resource The Kobeissi Letter responded.
“A healthy economy will experience many recessions over the long-term. A bubble is one that does not experience a recession. This is a case of a bubble and recession. Fake markets are not real.
Analyzing the European situation, Robin Brooks (chief economist at IIF), warned about a “deep” economic recession. This was based on consumer confidence data.
“With the second quarter GDP revision negative the White House stated that this isn’t the definition of recession,” popular Twitter account Unusual whales continued on the confusion about what constitutes a slump which started earlier in the year.
They advocate for NBER’s which is “a significant decline of economic activity spread across all sectors of the economy lasting longer than a few weeks.”
This event occurs after the Bank of England intervenes abruptly in the United Kingdom’s bond market. They then return to quantitative easing (QE), in a move that is reminiscent of the atmosphere during Bitcoin’s birth.
$19,000 seems unstable
However, the Bitcoin price action managed to avoid significant volatility even though the monthly close was just one day away.
Similar: Bitcoin’s ‘great detox’ could cause a drop in the price to $12K.
BTC/USD was trying to break $19,000 support at the time of writing.
Although the -0.6% GDP result was better that the forecasted -0.9%, Material Indicators, an on-chain analytics resource, had little to celebrate.
Material Indicators shared a screenshot from the Binance BTC/USD order books and warned that the market bottom was not in.
Strong economic report indicates that FED tightening is not having much, if any, impact. Translation: More aggressive rate increases through Q4 and into 2023,” it predicted as part of the accompanying comments.
BTC/USD order book data (Binance) chart. Source: Material Indicators/ Twitter
These views and opinions are the author’s and do not necessarily reflect those of Cointelegraph.com. You should do your research before making any investment or trading decision.
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BitMEX CEO warns that Ethereum Merge could cause high volatility
The Ethereum Merge is one the most anticipated events within the crypto space for this year. Crypto firms are always on the lookout to spot any issues that might arise as the new upgraded Ethereum network becomes operational.
Alexander Hoptner (CEO of BitMEX crypto exchange) spoke to Cointelegraph about how the trading platform is preparing the Merge. He also discussed institutional adoption potential after the transition from proof of stake (PoS) and his thoughts on Bitcoin ( BTC and Ether ( ETH).
Hoptner explained that, aside from making sure all boxes are checked on company preparations for big events ahead of them, it is important to be attentive to what could happen and ensure that the services they provide are functioning properly. He explained:
“You must be just, let’s call it, awake and watch what happens. There is a possibility of high volatility. You need to ensure that your services are available. […] We do not expect major disruptions other than volatility.”
BitMEX’s executive said that a fork would be successful if it was supported by a strong community. Hoptner pointed out that forks are at risk if there isn’t enough support from miners.
The issue of institutional adoption following the Merge was another topic discussed during the interview. The BitMEX CEO feels that PoS Ethereum is better for organizations than major players who are increasing their services to institutional players. This is because it addresses the main environmental narrative with which institutions are most concerned. He stated:
“I am certain that this will push for institutional adoption as well as mass market adoption, because […]nerally, the current generation pays close to the efficiency, environmental development.”
He also pointed out that large financial institutions are already experimenting with crypto, primarily BTC and ETH. Hoptner stated that many institutions already offer 1% to 22% crypto in their portfolios and that he expects this trend to continue.
Related: ETH Merge – CoinGecko founder shares his strategy for forked tokens
Contrary to popular belief that the market is at the moment, BitMEX CEO shared his team’s belief that the current market conditions are not bearish. Instead, he believes that there is a small correction in traditional finance. He stated that:
“Beforehand it was extremely overheated on the market. We were too fond of money, and this is now a minor correction. However, we are extremely bullish about Bitcoin and ETH, particularly for proof-of stake.
Hoptner is positive that the Ethereum Merge is a positive step in the industry and reiterated his team’s belief in the value of ETH. He also stated that Ethereum has a strong community and ETH could eventually surpass BTC. He stated that he believes it could surpass Bitcoin in relative growth.
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