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July 2021 Market Trend Report

BTC Price Trend: Based on the 4 key BTC price indicators and data as of 31 July, BTC prices is in the recovery phase although a quick rebound to previous highs is unlikely.

Market Trends:

Private investments within the crypto industry have been booming with increasing amount of funds supporting the growth of the nascent crypto ecosystem. Crypto-focused companies are receiving greater interest with many firms receiving strong funding. With such strong support from the institutional investors, the overall industry should continue its boom.

Once seen as a passing fad, the NFT sector has rapidly developed and gained popularity within the crypto ecosystem. More established firms have entered the space along with increased participation from artists and contributors. The entrance of firms like Alibaba and Shopify have improved the legitimacy and should attract more merchants to join the NFT scene. With the boom, NFT-related native tokens could potentially be boosted, and prices rise in the near term.

Stellar Development Foundation is in preliminary discussion with Advent (private equity firm) to purchase MoneyGram. Should the deal take place, this could mark a seismic shift in power equilibrium between crypto firms and traditional finance firms. A successful partnership would bode well for XLM, the native token of Stellar.

Abnormal Activity Tracker: No abnormal activity detected on the Bitcoin or Ethereum blockchain. Bitcoin total hashrate has started to recover slowly as more miners migrate out of China to other regions.

BTC Price Trend

Based on the 4 key BTC price indicators and data as of 31 July, the BTC is in the recovery phase although a breakout within the short term is not expected.

Overall:

NVTS is a short-medium term bull/bear indicator. Current NVTS value is 78.5, on the recovering from previous lows, suggesting BTC prices is more fairly valued;

MVRV is a short-medium term bull/bear indicator. Current MVRV value is 2.10, in the neutral region, suggesting that the market hangs in balance;

Mayer Multiple is currently 0.88, a recovery from previous lows, however the indicator remains below 1, suggesting that the market is yet to break out into the bull territory;

Funding rate did not reach abnormal levels during July. No clear short-term price signals are provided.

As discussed per our previous report “Price Indicators Deep Dive and Bitcoin Price Analysis”, there are limitations to the aforementioned indicators, and these indicators should only serve as suggestions and not investment advice.

Market Trend

The second quarter of 2021 saw a record $4 billion in venture capital raised by cryptocurrency firms, amid a bumper crop of $30.8 billion in fintech deals according to CB Insights. The quarter’s private fundraise was the largest till date, with key investments in sub-sectors such as compliance, crypto custody and infrastructure firms.

FTX crypto exchange valued at $18b in the latest $900m Series B funding round, the largest funding round in crypto history. Investors in the latest round included more than 60 firms, including Paradigm, Ribbit Capital and Sequoia, and receive great interest within the private equity world despite the recent dip in crypto prices.

Digital soccer collectibles platform Sorare announced that it will receive $532 million in funding with the company valuation exceeding $3.8b, the largest capital raise in the history of France's technology sector. SoftBank will lead the funding round with Atomico, a U.K.-based venture firm taking part. A number of Europe’s most powerful club teams, including Bayern Munich, Juventus, Real Madrid and Liverpool have launched non-fungible tokens (NFTs) through the platform.

Global payments giant Mastercard is adding a cryptocurrency and blockchain track to its Start Path incubator program for later-stage startups. Mastercard offers up experts and technology partnerships with other financial services firms in the program in exchange for adding more innovative companies to its client roster. In addition, Mastercard mentioned that it will invest in some of its partners as they seek to broaden their presence within the crypto industry.

Commentary: Despite the lackluster price movement of key crypto tokens, the private investment market remains active with numerous crypto-focused firms getting private capital investments. Private funding in 2nd quarter of 2021 eclipses previously highs and show no signs of abating in the latest month. A record number of deals, amount of funds, highest fundraise continue to headline the growth within the sector. This bodes well for the industry as institutional investors remain confident and interested in crypto.

Alibaba’s E-Commerce website Taobao included NFT Arts in its latest version of the Maker Festival. NEAR Protocol has partnered with blockchain gaming firm Web3Games and Chinese artist Heshan Huang to create and sell NFTs on the Taobao platform this year. The collaboration was considered a success as all the NFTs were sold out on the platform and helped to raise awareness of NFTs within the arts scene in China.

Shopify announced that it is currently allowing merchants on its platform to sell NFTs directly to customers. Before this announcement, merchants had to sell their NFTs on 3rd party marketplaces and ceded much control to these marketplaces. Shopify’s move aims to return the power back to the hands of the merchants and grant them more flexibility in conducting their business. One of the first Shopify merchants to offer NFTs will be the National Basketball Association’s Chicago Bulls, which launched an NFT “Legacy Collection” to sell to customers.

Commentary: The NFT sector has grown from a passing fad into one that is rapidly growing. Initially seen as a meme, the sector has benefited from an increase in participating firms, artists, and customers, helping to boost the ecosystem. Many reputable firms such as Alibaba and Shopify have taken notice and seek to leverage on the growing trend. With the continued support from the contributors and interest from customers, the NFT sector looks to continue its red-hot run and boost NFT-related native token prices as transactions and funding continue to pour in.

Stellar Development Foundation has contacted MoneyGram International about a potential purchase of the 81-year-old remittance giant according to a Bloomberg report. Stellar is currently in discussion with private equity firm Advent to explore opportunities in the space and take advantage of the potential synergies. The deal is still in early stages of exploration and could potentially yield no results.

Commentary: Should the transaction takes place; the deal will mark a significant milestone within the crypto industry. Although Ripple Labs had previously owned a significant amount of MoneyGram’s share, it did not outright purchase the company due to multiple reasons. The acquisition of MoneyGram by the Stellar Development Foundation could mark a shift in power equilibrium between crypto firms and traditional finance firms, making a statement across the globe. A sizeable powerhouse within the remittance scene, MoneyGram will help Stellar speed up the adoption of blockchain technologies and cryptocurrencies within the sector. The deal could potentially be a big booster to XLM, Stellar’s native token.

Disclaimer

Matrixport provides this analysis as general information only. Matrixport accepts no responsibility for the accuracy or completeness of any information herein contained and Matrixport shall not be responsible for any loss arising from any investment based on any forecast or other information herein contained. The contents of this materials should not be construed as an express or implied promise, guarantee or implication by Matrixport that the forecast information will eventuate. The cryptocurrency market is highly volatile. Buying, selling, holding, or investing in cryptocurrencies or related product carries various risks and is not suitable for all investors. Please seek expert advice, and always ensure that you fully understand these risks before participating in the cryptocurrency market.
Matrixport is not acting as a financial adviser, consultant or fiduciary to you with respect to any information provided. Any information available here is “general” in nature and for informational purposes only.

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