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Bitcoin Prepares For Growth

Published 10/17/2019, 08:06 AM

Bitcoin keeps consolidating in the $ 8500-7500 range. The sluggish dynamics was immediately noticed by market participants and has already entailed a significant decrease in interest among traders who prefer more volatile trading. It is worth noting that this market apathy is currently observed in the entire crypto industry, not only over Bitcoin. Is the news background so scarce that Bitcoin has nothing left to do except for trading flat? In fact, it’s not that bad and there are still some fundamental triggers that can revive the bullish rally in BTC.

Firstly, the fate of Bitcoin ETF is still unclear. Let us recall that Exchange-Traded Funds or ETFs are ready-made portfolios of securities or other assets exchanged on a stock market. They operate as investment funds and provide everyone access to an index or property. With Bitcoin-based ETF there is no need to worry about the safety or storage of Bitcoins. It’s a much safer and easier option for investing in cryptocurrency. However, there’s always a “but”. Since ETFs are Bitcoin derivatives, they must be approved by the US Securities and Exchange Commission (SEC) before they can be launched. Unfortunately, this process didn’t go off without a hitch. To date, none of the exchanges have received the green light to launch such contracts. It is worth noting that many have tried. Back in 2016, SolidX applied for Bitcoin-based ETF, and later was followed by CboeBZX, VanEck and Bitwise. Nevertheless, the market participants remain enthusiastic, which supports the idea that the first ETF contracts may appear by the end of 2019. Bitwise Asset Management has very good chances of becoming pioneers in this area.

Secondly, let’s not forget about Bakkt futures - a special trading platform created by ICE (NYSE:ICE), which allows trading cryptocurrencies. Access to the platform can be obtained by both retail traders and institutional investors. Despite the fact that it’s been almost a month since the launch of Bakkt, trading volumes leave much to be desired. Nevertheless, the experts warned that the start is likely to be sluggish. First, retail traders should come to the exchange, and only then, after some time, institutional investors would become interested. It is worth noting that CMEGroup has also seen a similar slow start, but then liquidity increased significantly.

Lastly, the launch of Libra or Gram may contribute to Bitcoin’s growth too. According to Zuckerberg and Durov, the launch of the above cryptocurrencies will create a global payment system for people who don’t have the opportunity to use banking services. In other words, we are talking about the appearance of direct competition to banks. According to very approximate estimates, private companies participating in Libra and GRAM would have over $ 3 trillion at their disposal, which obviously implies great influence in the financial markets. It is not surprising that both projects faced great resistance from the financial officials. It is worth noting that not only the United States but all the word’s biggest governments fear the launch of stablecoins. Despite all this, it is a possibility that Durov and Zuckerberg may succeed in persuading the SEC. The regulator’s loyalty can be earned in exchange for the opportunity to track and verify financial transactions.

All in all, Bitcoin ETF, Bakkt, Libra and Gram won’t necessarily become the next growth drivers for Bitcoin, although each of them has all chances to trigger new growth. It’s only a matter of time now and all we can do is wait and see, which driver will eventually push Bitcoin to the moon again.

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