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Markets Rebound as Federal Reserve Chairman Clarifies “No intention to ban” Cryptocurrencies in United States – Weekly Roundup

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September has historically been a down month for crypto-markets.  October on the other hand has typically treated investors well.  Sure enough, markets are now up as we enter the new month on positive news out of the United States, recovering from a rocky week plagued by uncertainty out of China.

Evergrande

As China doubled-down on its stance/ban against crypto last week, markets reeled with FUD.  Further compounding this was news of behemoth property developer Evergrande becoming insolvent, and the effects it would have on markets around the world.

While initial fears surrounding the situation have since abated, it has not yet resolved, with Evergrande having already defaulted on multiple loan repayments.  Interestingly, there is an increasingly large group which believe China will be able to resolve the potential implosion of Evergrande, and have begun purchasing debt in the company.

No Intention to Ban

When the aforementioned events occurred, there was a significant amount of new wallets which panic-sold, clearly having not yet experienced a Chinese ban on crypto – something that has happened no less than 7 times over the years.  Naturally, many came to wonder and worry if the United States would follow a similar path moving forward.

Thankfully, Federal Reserve Jerome Powell has allayed these fears, explicitly stating that the government has “no intention to ban” cryptocurrencies.

A Billionaires Perspective

In addition to the head of the Federal Reserve commenting on cryptocurrencies, this week saw multiple billionaires share their opinion as well.  Both Elon Musk and Orlando Bravo independently indicated they believe that cryptocurrencies are not going anywhere, and that they can’t be stopped.

In an interview with CNBC, Orlando Bravo stated, “How could you not love crypto?  Crypto is just a great system.  It’s frictionless.  It’s decentralized.  And young people want their own financial system.  So it is here to stay.”

Speaking at a coding conference, Elon Musk stated, “It is not possible to, I think, destroy crypto, but it is possible for governments to slow down its advancement.”

Undoubtedly, if they came to these conclusions (along with millions of existing market enthusiasts/participants), then it is unsurprising to find the Federal Reserve doing the same.  With clarity now provided on a potential ban, hopefully moving forward there can be thoughtful regulation fostering growth and safety.

Market Reaction

When looking at the performance of BTC over the past week, it is clear that the market was suffering under the weight of developments coming out of China.  If the market was to recover, an important bit of positive news was needed – and that is just what it got.

After grinding down towards $40,000, BTC was able to post a dramatic upswing after news of the United States having no intent to ban cryptocurrencies began to circulate.  While this was an important statement, there were indeed other smaller but positive developments which occurred this past week – namely El Salvador officially launching its volcanic (geo-thermal) green-mining initiative.

While things were looking precarious for a little bit, this end of the month uptick in price resulted in yet another example of the popular analyst ‘PlanB’ nailing another price prediction.  In doing so, the stock-to-flow model remains intact.  Moving forward, PlanB notes the following price floors for the coming monthly closes.

Joshua Stoner is a multi-faceted working professional. He has a great interest in the revolutionary 'blockchain' technology. In addition to this, he is a licenced Paramedic in Nova Scotia, Canada. As such, he can provide emergency care/medicine to any situation necessitating it.

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