Summary:

• Bitcoin (BTCUSD on xStation5) settles down as the new week unfolds, a key support seems to be in play
• UBS chief economist compares Bitcoin to the tulip crisis which took place in the Netherlands
• Uruguay is going to launch its own digital currency

The beginning to the week in terms of cryptocurrencies has been quite benign as the Bitcoin price and its major peers are moving sideways. As far as Bitcoin is concerned it’s worth taking a look at a technical analysis where bulls seem to defend their major support in form of an upper boundary of an ascending channel. Buyers have been able to keep the price above a key line thus far which could suggest that they could keep a lid on the market going forward. If so they may try to strike a round $8000 in the nearest future. On top of this it needs to stress that a support is underpinned by a local 23.6% retracement placed around $7060 which has halted a bearish impetus as of yet.

Bitcoin has stopped short of increasing, however a pullback could be contained as a key support is in play. Source: xStation5

Let us remind that we wrote about the famous Jamie Dimon’s speech regarding Bitcoin several weeks ago when he called it ’a fraud’ warning that he would dismiss everybody trading the virtual currency. Today we have another prominent person who voiced some doubts related to Bitcoin, UBS chief economist Paul Donovan who compared Bitcoin to the tulip crisis which took place in the Netherlands in 1637. Notice that his remarks came on the heels of the groundbreaking announcement from the CME which revealed its intention to list a Bitcoin futures contract later this year. Although Donovan opposed digital currencies he did say that he was “a big fan of blockchain”.

Finally let’s move to Uruguay where the country’s central bank (BCU) formally presented rollout of its pioneering digitization of the Uruguayan peso on 3 November. It’s a pilot program and the bank reminded that it’s not a cryptocurrency such as Bitcoin but a currency that remains the responsibility of the BCU. The first issue consists of 20 million Uruguayan pesos while as much as 7 million of them were already transferred to Red Pagos, the national payments and collection company. It’s also worth underlining a speech of the president of the BCU who said  that “this is not a new currency, it is the same Uruguayan peso that instead of having physical support has a technological support”.