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BTC Congress purchased the crash

BTC Congress gets a crash course on cryptocurrency.

BTC Congress witnessed testimony from 6 major crypto CEOs over the past 24 hours, discussing the superior security and transparency of cryptocurrencies compared to the traditional financial system. The hearing, initiated by Representative Maxine Waters, the California Democrat leading the committee, aimed to deepen understanding of rapidly evolving digital assets and inform regulatory approaches.

Blockchain technology, as highlighted during the testimonies, ensures transparency and security equally. Every validated block is visible publicly across the network. Additionally, blockchain operates on a consensus mechanism, requiring a significant majority of validators to agree on any ledger changes. As Brian Brooks, CEO of Bitfury, stated in Congress, “In our current financial system, one bad actor can compromise the entire system. Blockchain is essential to our security infrastructure, preventing such scenarios.”

There has also been movement here in Australia. Treasurer Josh Frydenberg said The government of Australia will announce the biggest reform in payment systems in 25 years, including crypto. In an attempt to modernize Australia’s payment systems, the new regulations will broaden the definition of services and products that can be regulated, moving cryptos out of the grey and into the world-leading regulatory framework.

Reading between the lines here, there are big plays taking place from the regulatory standpoint. If you are wanting large scale adoption, then regulation will pave the way. If regulation moves into the market, large investors who were on the sidelines will no doubt begin to step into the market due to the increased security. Regulation change will also provide opportunities for other crypto-related financial products.

Despite the recent correction across the cryptomarket, this news is only positive for the long term outlook.

Bitcoin Technical Analysis

RHODL Ration Bitcoin Technical Analysis

In summary, Realized Value HODL waves are different age bands of UTXO’s (coins) weighted by the Realized Value of coins within each band.

The Realized Value is the price of UTXO’s (coins) when they were last moved from one wallet to another. As the RHODL ratio increases, it suggests large/whale investors are moving coins that have matured in price as BTC runs into a top in the market. Essentially they are selling BTC at the major bull market peaks. This particular indicator has had a 100% success record in predicting tops in the market.

Despite the recent long squeeze as BTC broke down from the rising channel structure. Most indicators are not suggesting a major cycle top is in play. They are actually suggesting the recent pullback is a midcycle adjustment.

Relative Unrealized Profit/Loss chart

When do pullbacks in the market occur?

All financial markets are sentiment-driven. Greed and fear are the driving force behind sentiment shifts in the market. The relative unrealized profit/loss can provide an insight into retail trading psychology. When retail investors reach a euphoria stage the market becomes overly bullish as most investors are in profit. This leads to careless investing and generally ends badly. Leading into major BTC bull run peaks, investor relative unrealized profit and loss generally runs through the greed area and into euphoria. A long term investor can monitor these charts as they will provide you with sell signals. Again, this chart is indicating a mid-cycle adjustment rather than a euphoric top.

Bitcoin Pullback

BTC has taken a sharp downturn outside of the rising channel structure and moved just shy of our 40k downside target. For the time being, we will be watching for a consolidation phase before the next big move.

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That is all for now,

Kind regards,

Tony Fernandez

Head Market Analyst

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