The battle for segwit has moved from bitcoin to litecoin as the two camps are engaging in all-out mining war. Litecoin prices swung back and forth widely since our last update as a result. But first let’s go over BTC and as usual, we’ll come back to Litecoin later in this article.
Bitfinex Stops Deposits, Price Spikes
More drama in the crypto arena this week and the star is again Bitfinex. The embattled exchange stopped all deposits yesterday, adding to market fears about solvency problems. It’s unclear if the deposit block was instituted by their Taiwanese banking partners or by Bitfinex themselves. The wording of their announcement implies the first option. A few weeks ago Bitfinex was forced to stop USD withdrawals after Wells Fargo blocked their wire transfers. Initially, the exchange filled a suit against WF but this was later dropped.
These events caused the price of bitcoins on Bitfinex to spike and significantly diverge from the rest of the USD market. Currently, one BTC is selling for $1,272 on this exchange while most are quoting prices around $1,214 dollars per coin. If these deposit/withdrawal issues continue, we can expect the price of bitcoins on Bitfinex to initially surge as traders cash out via BTC ‘while they still can’. This process could be followed by a crash in the price if BTC withdrawals are instituted as well. As of now, this is all speculation, we are as clueless as anyone about what exactly is going on at Bitfinex.
The overall market will be somewhat affected by this drama and on balance, this should be negative for the price of BTC/USD. Technically, however, bitcoin remains in a short-term uptrend. To end it the bears will have to push prices below the $1,150 figure. A new downtrend requires a break of the $1,000 round level.
Segwit Battle Moves to Litecoin
The battle for segwit has moved from bitcoin to the litecoin turf. In the past 24 hours we saw the anti-segwit camp ramp up their mining hash power significantly. It now appears that they will manage to block segwit for another activation period. Currently, the Segwit miner support stands at 75.81 percent (75 % is needed for activation). But during the past 24 hours this figure was only 63 percent. If the trend continues, the upgrade will be blocked yet again.
Technically LTC/USD is still in a rally. A decisive breakdown below the $8.75 swing low is needed to end the current bullish run. On the longer-term charts (weekly and monthly) Litecoin is in an uptrend as well.