The leading cryptocurrencies showed weak volatility during the past week and are currently more likely to continue this trend than to rise or fall due to uncertainty in the market. In turn, digital asset traders are now closely watching incoming news, because such information channels involuntarily make us remember the first months of last year. According to CoinDesk, Bitcoin’s volatility fell by 98% over the year, because on January 16, 2018, this figure was $3,468 in light of the collapse in asset value at the time and the frustration of ordinary investors. Today, Bitcoin’s volatility is only $61. How such news affects the rates of digital assets is presented in this material by DeCenter.

Russians Are Not Ready to Buy Cryptocurrencies Due to Misunderstanding

Until now, the belief of a wide range of investors in cryptocurrencies has not recovered, which can also be seen in the latest study by experts from Kaspersky Lab and B2B International. It states that more than a third of Russian citizens (37% of respondents) simply do not understand how to interact with assets that cannot be “physically touched,” although they know about their existence. Among the 924 Internet users who took part in the survey, 42% are not interested in using digital money even in the future, which is also likely due to a lack of confidence in the new product and the collapse of many assets after an unrestrained growth at the end of 2017. 2% of those surveyed said that they lost their funds in cryptocurrencies due to fraudulent software, hidden mining, or embezzlement of funds from crypto exchanges. At the same time, not everything is as pessimistic as it may seem at first glance, because 8% of respondents have cryptocurrencies and make payments in them on a daily basis, even though the practice of crypto payments is not as common in Russia as in the USA or Sweden, Estonia, and other European countries. It is possible that at the end of this year, in Russia, users will be more trusting in cryptocurrencies if rates do not show record volatility for financial instruments and crypto coins are increasingly used to pay for goods.

Ethereum Was Unable to Launch the Constantinople Network Update

January 16 will go down in the history of the third-most capitalized cryptocurrency as one of the most challenging days because the community nearly split in light of the confrontation around updating the network on block 7,080,000. But just a day before the appointed time to start implementing the Constantinople upgrade, smart contracts audit company ChainSecurity reported a critical vulnerability that could allow attackers to make an infinite number of transactions on the same block. After urgently convening a meeting of the creators of the project, Vitalik Buterin, Hudson Jameson, and Nick Johnson, as well as the developers and managers of the projects operating on the Ethereum blockchain came to the conclusion that the update was not yet ready for launch, and it was decided to postpone it indefinitely until the error is rectified.

HSBC Announced Success of Currency Exchange Blockchain Platform

2018 was filled with skepticism about the future of cryptocurrencies from representatives of large financial institutions. But at the same time, there was a successful application of blockchain technology within these organizations. One of the world’s largest banks conducted more than 3 million currency exchange operations and 150,000 payments worth more than $250 billion on its internal HSBC FX Everywhere Platform as part of internal transactions in 2018. And now the credit institution is ready to offer this successful experience to its large clients engaged in cross-border operations and dealing with millions of currency exchange operations. This will allow corporations to directly exchange currencies, as well as improve the documentation system for conversion operations.

USDC Became Number 1 among the “Young” Stablecoins

Another news of last week, which increased the credibility of the cryptocurrency sector, is a message about the successful completion of the audit of the USDC stablecoin, which the representatives of the startup Circle have already boasted about. Earlier in 2018, they were audited by the audit company Grant Thornton, and from the last report of the same company, it became known that the number of coins issued and their fiat equivalents was almost entirely in the electronic “vault.” At the time of the check, there were more than $251 million in custodial accounts, which corresponded to the number of coins issued.

In this connection, USDC is gaining more and more popularity in the crypto community, and the day is not far when this stablecoin can compete with Tether, which is constantly under attack in the financial media because of the lack of understanding in the simple question put by the experts: Is the cryptocurrency fully backed by U.S. dollars? It will, however, be tough to oust Tether from 6th place in the Coinmarketcap ranking (capitalization of more than $2 billion) due to the extensive use of this asset in cases of cryptocurrency subsidence and incomplete confidence in its counterparts. At the time of this writing, USDC capitalization is $329 million, and it is ranked 19th in the same ranking.

Chart of cryptocurrency capitalization dynamics excluding Tether for the last 45 days at the beginning of January. Source.

A Watch with a Bitcoin Wallet Will Be Created in Switzerland

And at the end, it is worth noting one of the very good news for the crypto community as Swiss watchmakers are keeping up with the times and decided to place a built-in wallet for storing cryptocurrencies in the mechanism of their products. The handmade watch company A. Favre & Fils, founded in 1718, decided to integrate the cold wallet and “modern security solutions based on the blockchain.” These watches will not only be a means of spending money earned on cryptocurrencies but can also become a useful assistant for their owners. To date, it is only an idea, and the prototype of the “Crypto Mechanical Watch” will be ready in the 2nd quarter of this year. In this case, the designers have already promised that the watch will include a protective function in case of theft or loss so that it would be impossible to debit funds from the wallet. Sales will begin at the very end of spring or early summer of 2019, with the cost of one item ranging from 100,000 to 150,000 Swiss francs.

Technical Analysis of Cryptocurrencies

Bitcoin

Bitcoin continued to “play on the nerves” of traders, which lead to the continuation of movement in the region of $3,700 with reduced volatility volumes last week. At the time of writing, a more attractive picture can be noted for continued growth to the previously designated value of $3,900– $4,000 in the coming weeks, although it is more likely to decline due to a large number of open buy positions. When they are “thrown out of the market” at stop orders in the support area of ​​$3,600 or even $3,300, then “big business” will start to gain positions for purchase, and then it is worth waiting to overcome the key value of $4,000. In any case, this very level is connected with the psychological overcoming of the barrier by the majority of buyers, who are also still wary of new landslides and the search for the bottom with Bitcoin. At the moment, the previously identified goals at the levels of $4,150–$4,500 are still relevant as part of the implementation of the double bottom technical analysis model. The long-term goal of the coming months in the form of movement in the area of ​​the cluster $5,280−$6,000 also remains relevant.

BTCUSD chart, daily timeframe. Source.

Ether and Altcoins

Ether continued to consolidate below the resistance value of $130 and took the form of the Wedge technical analysis model with the option to retest the $100 area. In the coming weeks, there is still a chance to overcome the $130 level with the possibility of reaching $160–$180 in the coming weeks and the target of the coming months at $216. Litecoin also retains intrigue with the potential to break the boundaries of the current consolidation at $30 and $33.60. Increasing demand for Bitcoin will push capitalization growth to this asset, which may lead to the consistent achievement of local extremum levels of $40 and $43.50 within the next weeks.

ETHUSD chart, daily timeframe. Source.

The Most Important Events of the Crypto Market in January 2019:

 Initially, the launch date of the Bakkt platform was scheduled for January 24, 2019, but according to the latest information, this event will be postponed to a later date until mutual understanding with the CFTC regulator is found. On this day, a collapse of the rate may occur, as it did on January 17, the day the Constantinople update was canceled on Ethereum. Be careful when making deals on this day and the days preceding it!

 The expiration of January Bitcoin futures contracts on CME is scheduled for January 25 at 4:00 PM GMT.