Cryptocurrencies gain as investor sentiment remains bullish
After the sharp declines experienced in 2018, the crypto sector is enjoying a better start to 2019. The total market capitalization of cryptocurrencies has gone up from slightly above $120 billion to the current $137 billion. These gains have been led by Bitcoin, which has gone up by more than 500 points. Ethereum too has managed to move from below $90 to the current $150.
The recent price increases have come as developers and enthusiasts try to explore the next phase of the blockchain market. Stablecoins have been in the limelight of late. These are cryptocurrencies that are backed with other assets such as the US dollar. They help to reduce the amount of volatility that exists in the crypto market. Already, a number of stablecoins have been developed and Facebook is said to be working on one.
Tokenization has also come into focus. This is a strategy where liquid and illiquid investments are tokenized, making it easier for people to invest in and trade them. For example, stocks listed in New York could be tokenized and offered by a cryptocurrency exchange. The advantage of this is that it creates a new ‘asset class’. In addition, it allows traders to trade in these assets even during the weekends when global markets are closed. Further, developers believe that tokenization will create more liquidity in illiquid assets such as real estate investments.
The ETH/USD pair has moved up to more than 150. On the hourly chart, this price is above the 21-day and 42-day EMA while the RSI has been relatively stable below the 70 level. At this point, the pair will likely move in either direction.