A Potential Uptober for Bitcoin, Chainlink After All
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| By Marija Matic |
Bitcoin's (BTC, “A-”) recent surge — driven by the optimism surrounding future demand from spot exchange-traded funds — has room for further growth, drawing insights from historical trends.
BTC once again finds itself close to its 2023 high.
The encouraging development is that Bitcoin has comfortably surpassed the $31,000 level today, marking a gain of over 4.6%. The momentum continues to be bullish, with Bitcoin registering five consecutive days of gains and demonstrating an impressive ascent of nearly 15% over the past seven days.
However, traders are approaching the situation cautiously. There is a healthy dose of skepticism that the journey beyond $32,000 will unfold swiftly or effortlessly.
The Fear and Greed Index shows that sentiment is still “neutral” and has yet to turn to “greed.” However, the Index shows a notable increase of positive sentiment since last month.
Still, the momentum is trickling down into the altcoins, many of which have broken out of their months-long channels. But none has gathered as much buzz and sighs of relief as Chainlink (LINK, “B+”).
For a year and a half, LINK had been trading within a tight range, earning itself the mocking name "stablecoin." Finally, yesterday’s breakout above resistance at $9.50 propelled it to $11:
Many are expecting LINK to build on this positive momentum, with the first notable target being $13.30.
Meanwhile, another altcoin is in the spotlight, but not for its price action.
Last Monday, Uniswap (UNI, “C+”) token holders found themselves divided over the introduction of a new fee structure that is projected to generate significant revenue: Hayden Adams, the creator of Uniswap, has revealed a 0.15% trading fee will be charged on certain tokens on the platform's website and wallet, in addition to the existing 0.3% protocol fee on all swaps.
This new fee has the potential to generate substantial income for Uniswap Labs, the company behind the decentralized exchange protocol and its widely used website and wallet. However, the move has faced criticism from parts of the community because it doesn't directly benefit UNI token holders, despite its promise to enhance the ecosystem through research and improvements.
So, when the announcement was made last Monday (as indicated by the blue pointer), the price responded unfavorably, resulting in a 7% decline:
The price dipped to $3.83, but it has since rebounded and even rallied, reaching $4.35 today and aligning with the bullish trend of the broader market.
So, what does this new Uniswap fee mean for the community?
Well, first, it's important to note that only users conducting swaps through the official Uniswap website and wallet are subject to the 0.15% fee. Users who utilize services that aggregate decentralized exchanges or directly interact with the protocol's code are exempt from this fee.
Some are optimistic that this change will encourage the development of additional interfaces for the exchange and steer users toward aggregators, thus enhancing their overall experience.
However, some UNI token holders are still expressing frustration over the absence of a "fee switch" that would allocate a portion of the liquidity provider earnings to them.
The most significant UNI voters remain cautious about the regulatory complexities and implications of such a move, which is why no decision has been made by the DAO through a vote so far.
Meanwhile, this past year has showed us that users have been sticky as Uniswap continues improving. So far in 2023 alone, the team has released an iOS wallet, Android wallet, UniswapX, major improvements to the Uniswap web app, Permit2, Uniswap v4 draft codebase and more.
In addition, Uniswap Labs has given over 60 grants to developers, researchers and others, many of whom have gone on to raise venture capital or additional funding for their apps/ideas built on Uniswap.
Companies being able to generate revenue by building on Uniswap is good for long-term growth and success of the protocol.
Notable News, Notes & Tweets
- Charges were dropped against Ripple’s (XRP, “B-”) executives, although the case against Ripple continues, giving the investors partial relief.
- A lawsuit has been filed against Gemini, Genesis Global Capital and Digital Currency Group by New York Attorney General Letitia James, accusing them of defrauding investors out of over $1.1 billion.
- Polkadot (DOT, “C+”) workers endured ‘Hunger Games’ retreat after getting news of mass layoffs, employees say.
What’s Next
Bitcoin is extremely bullish right now as the approval of a spot ETF is getting priced in in advance. Still, it faces potential challenges in the form of macroeconomic data releases.
The final economic data for October will take on heightened importance as the Federal Reserve will make a decision on the federal interest rate on Nov. 1. Additionally, ongoing geopolitical events are likely to introduce another layer of unpredictability to the market.
Considering the significant implications for cryptocurrencies and other risk assets, the upcoming week appears poised for a tumultuous ride. And while that may be enough to shake out some weaker hands, crypto enthusiasts meanwhile are eyeing the prospect of a substantial trend shift via breakouts from extended multi-month trading ranges, as they feel increasingly bullish.
Best,
Marija
