Traditionally, the strongest quarter for Bitcoin and Crypto trading is Q4 and there is much market anticipation for Q4. Q3 was dominated by news out of China.
On Sept 24th, China announced they were banning Bitcoin (as they have done every year since 2009). Bitcoin reacted with a drop to test it’s support at $40k. It must be noted that mining aside, China has never been a major Bitcoin player, so this news rumbles retail only, and the markets have now recovered.
At the end of September, the Chinese government announced it was extending it’s Internet Firewall to ban Coin Market Cap, Coin Gecko as well as Trading View. All three are leaders in the Crypto space for providing price information, charting, and individual coin information. The Chinese authorities are paving the way for their own Digital Currency, as well as protecting themselves from Capital Flight.
Do we expect something similar in Europe and The US? We believe a Digital Euro seems a long way from being reality, and while The US is working on a digital currency, we think the likely target will be Stable Coins rather than Bitcoin or Cryptocurrencies. In late September, the US Federal Reserve Chairman Jerome Powell said he has no intention to ban cryptocurrencies.
The primary focus of our Investments remains within The Defi Sector, we also have worked on coverage of Layer 2 Scaling Solution Projects. Both Sectors remain very strong and Bullish.
We expect a retrace from where we are, so it remains to be seen where the new support levels will be, but at that point, we will not only add to existing positions, but also diversify into the strongest DEX (Decentralised Exchanges) projects. We expect strong growth in this sector.
The Chinese “ban” saw an explosion of money flows into Decentralised Exchanges, and a very recent project, DyDx, saw daily volumes exceed that of Coinbase (the largest regulated exchange in The US.
We began Blockchain Century Zenith Fund expecting to have investments in 15-20 projects. We have increased this to 24 over the last month. We are currently adding to the exchanges we operate on as part of our risk/exposure security protocols. This will also allow us access to otherwise unavailable projects. So following the next dip, we will, once again, be 100% allocated. We now envisage coverage of up to 33 invested projects.
Blockchain Analysis in September, saw peak levels of accumulation at around the $42k Bitcoin price. These are Institutional Buyers as well as Whales for long term HOLDS.