Week by numbers
The past week has been upward-trending for the cryptocurrency market. The price of the largest cryptocurrency, Bitcoin, rose by approximately 4%, while the price of the second-largest cryptocurrency, Ether, increased by about 0.5%. The total market value of other cryptocurrencies (excluding major stablecoins) climbed by roughly 12%.
As Ether underperformed compared to Bitcoin and the broader altcoin market outperformed Bitcoin, both Bitcoin dominance and the ETH/BTC ratio saw declines during the week—a somewhat unusual occurrence.
Throughout the bullish week, we saw several significant price surges. Among the tokens traded on the Kvarn X trading platform, the top performers for the week were XDC (+52%), XRP (+42%), and ALGO (+34%). On the other hand, the few decliners included MNT (-6%), TRX (-5%), and MKR (-4%).
Market Commentary
Following the immediate post-U.S. presidential election rally, the cryptocurrency market has spent the last two months moving sideways without a clear trend. Bitcoin’s price has fluctuated between a low of approximately $90,000 and a high of around $108,000.
Traders with an eye for detail might notice that the latest highs and lows during this sideways movement have been slightly lower than the previous ones. However, the differences are minor, and the price action still looks more ranging rather than a definitive downtrend.
These interpretations make us somewhat cautious at the moment. While there has been a sharp upward move since Monday evening, by Thursday, January 16, 2025, this rally appears to have stalled at a “lower high.” A local high of just under $103,000 from about a week ago now serves as a critical watershed. If this level proves insurmountable, we may once again test the lower boundary of the range.
The drivers behind the slightly bearish sideways movement in the crypto market are not hard to find. In recent weeks, cryptocurrencies have largely mirrored the movements of the stock market. The S&P 500 index has been on a gentle downward slope since early December.
Monday’s strong start on January 13, 2025, raised cautious hopes that the stock market might be finding a local bottom, which would also bode well for the crypto market. However, we’re still waiting for the S&P 500 to clearly break above 6,000 points—a milestone that, as of Thursday, January 16, 2025, remains unfulfilled.
On the currency markets, attention is drawn to the U.S. Dollar Index, which has been on a strong upward trend for nearly four months. However, since Monday, the Dollar Index has turned downward, and the Relative Strength Index (RSI) has also started to decline.
If Monday’s touch of 110 proves to be a peak, a weakening dollar could once again act as a tailwind for risk-on asset classes. A drop below the 108 level on the Dollar Index could signal a trend reversal. However, as this has not yet occurred, our expectations remain cautious.
It is worth noting that all technical analysis at the moment should be approached with some caution, as we are in the final days before the of the U.S. presidential change. Donald Trump’s inauguration next week and the new administration’s policies still hold significant uncertainties. In the coming weeks, crypto traders should stay alert and be prepared for potential surprises in either direction as markets adjust to the new administration’s stance on tariffs and cryptocurrency regulations.
XRP Rockets
One of the most notable gainers of the past week has been XRP, a veteran in the crypto world. As highlighted in the week’s key figures, XRP’s price surged by approximately 40% over the last week.
This is a remarkable price jump, especially considering that XRP, by market capitalization, is the third-largest cryptocurrency in the world, following Bitcoin and Ether.
Interestingly, XRP’s new cycle high occurred this week, even as the broader crypto market is not particularly hot. It is more common to see several major cryptocurrencies reaching price peaks simultaneously. Currently, however, XRP stands out as the only token among the top 50 by market capitalization to reach new 52-week highs.
This independent upward move brought XRP’s price relative to Bitcoin (XRP/BTC) above the 0.0000275 threshold. This is notable because, in recent years, this relative valuation level has often marked the ceiling for XRP rallies against Bitcoin.
In December, it seemed that this area might once again act as an insurmountable resistance level. However, over the past week, the XRP/BTC ratio breached it with ease. This breakthrough is a highly intriguing development. The next significant historical level against Bitcoin is 0.00037, which XRP/BTC is now only about 10% away from. We will be closely monitoring XRP’s price action, especially if the general trend in the crypto market begins to show clear signs of an upward trajectory, such as a new all-time high (ATH) for Bitcoin.
With these thoughts, we leave readers to follow the fascinating developments in the crypto market as Donald Trump’s inauguration approaches. We’ll be back next week with the Kvarn Pulse newsletter, so stay tuned!
New tokens added to Kvarn X – Toncoin, Mantle, Kaspa, Render, and Syrup!
The new tokens are now available on web and mobile apps. Be sure to update to the latest version of the app.
Toncoin (TON): Toncoin is the native cryptocurrency of The Open Network (TON), originally developed by Telegram. It offers fast transactions and scalability, making it a potential game-changer in the cryptocurrency market
Mantle (MNT): Mantle is a Layer 2 scaling solution for the Ethereum ecosystem that uses Optimistic Rollup technology to enhance transaction speed and reduce costs while maintaining Ethereum network security.
Kaspa (KAS): Kaspa is an innovative Proof-of-Work-based blockchain that utilises the GHOSTDAG protocol, enabling fast and secure transactions. It aims to address scalability challenges while maintaining high security and decentralisation.
Render (Solana) (RENDER): Render Network is a decentralised GPU rendering platform that initially operated on the Ethereum blockchain with the RNDR token. Following a community vote (RNP-002), Render Network has expanded its operations to the Solana blockchain, leveraging its low transaction costs and high performance.
Syrup (SYRUP): Syrup is the native token of the Maple Finance ecosystem, replacing the former MPL token. It functions within a decentralised finance (DeFi) platform focusing on institutional lending and yields.
2024 reports available
All 2024 reports are available for viewing and downloading in Kvarn X under Documents.
Profits and losses: Profits and losses calculated on realized transactions in 2024.
Transaction Report 2024: All transactions in 2024 and a summary of them.
Divly-compatible tax report: If you use our partner Divly for tax reporting, you will find a report tailored for this purpose.
Ideas for Building a Crypto Portfolio?
If you're wondering how to build a crypto portfolio or how to get started with crypto investing, we offer various theme-based examples in this section as ideas for constructing your portfolio. Please note that nothing in this newsletter constitutes investment advice or should be interpreted as an encouragement to make investment decisions.
Theme Idea: AI Tokens
Artificial intelligence (AI) is one of today’s biggest megatrends. AI tokens have been one of the hottest themes of 2024 in the crypto market.
Crypto projects that combine AI and blockchain technology are particularly interesting for two reasons:
1. Many aim to solve one of AI's biggest issues, data centralization. Projects focused on decentralizing data and/or computing power aim to provide a fairer and thus safer foundation for AI development.
2. These projects’ tokens allow small investors to benefit directly from AI's value creation, potentially more so than publicly traded stocks.
An example of an AI-themed crypto portfolio available on Kvarn X might include:
- Artificial Superintelligence Alliance (FET)
- Render (RENDER)
- Akash Network (AKT)
Stay tuned for more portfolio-building theme ideas in our upcoming Pulse newsletters!
The material contained in the Kvarn Pulse is produced solely for the purpose of marketing communication. Any information conveyed through Kvarn Pulse should not be construed as an offer or an invitation to make any purchase or sale decisions, or as an encouragement to make investment decisions about any investment object. Copying or borrowing the content of the newsletter without Kvarn's express permission is prohibited. The information presented in the newsletter pertains to the situation prevailing at the time of writing, and the information may or may not have changed. Kvarn Capital Oy does not guarantee the accuracy or completeness of the information contained in the newsletter or referred to in the newsletter.
