The bitcoin price was down 3% last week with the release of Bitcoin XT serving as the key driver of the sell-off. The ongoing Bitcoin forking debate should continue to impact the markets this week, as traders look to process the ramifications of a potential fork in January.
Bitcoin by the Numbers
Bitcoin Price Recap
Bitcoin price was down 3% week-over-week, continuing what has been a rough August for the market. Traders were able to point to a catalyst for last week’s sell-off which peaked over the weekend when prices dropped 4% to hit support at $256.
The market sell-off was triggered by the weekend release of Bitcoin XT, a patch set on top of Bitcoin Core. Bitcoin XT allows users to download a controversial update to the Bitcoin network which could lead to a fork in the blockchain in January 2016.
The patch was released so that a majority could be reached through optionality by allowing the community to use Bitcoin XT or Bitcoin Core. Although too early to tell, the fork debate will be something bitcoin traders should continue to monitor, especially if Bitcoin XT gains substantial traction.
Bitcoin Trading Week Ahead
The market is still trying to make sense of a potential fork and how this would affect long-term pricing. We could experience a sideways market over the next week offering minimal opportunities to build out long-term positions.
This week, support can be found at $252. Should those levels break, the market may head towards June’s support level of $240. August may ultimately prove to be a month-long market correction that cools off bitcoin’s previously hot summer.
Best Bits from Last Week
- NewsBTC: Visa Exploring Bitcoin and Blockchain Technology
- Coindesk: US Bank Regulator Calls for Balanced Bitcoin Oversight
- Medium: Why is Bitcoin Forking?
Bobby Cho is the Director of Trading at itBit and leads our Global OTC Agency Trading Desk. Previously, Bobby was Vice President of Trading at SecondMarket where he helped create the first broker-dealer based institutional bitcoin trading desk. He has extensive experience in both bitcoin and securities trading with clientele ranging from Fortune 500 companies, hedge funds, asset managers and other financial institutions.
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*All data and references are current as of 9:00AM EST on 8/17/2015.