The crypto market has been behaving somewhat strangely over the past couple of weeks – Bitcoin has been rising and falling rather erratically while adding to its market dominance, and altcoins have been plunging in price and shrinking in their market cap and dominance. With the Bakkt launch nearing and the global economy fearing economic instability owing to several politico-economic events, the crypto market can swing in any direction. Here is a list of factors that are contributing to the unpredictability of the crypto market –
The Upcoming Bakkt Launch
Word in the market is that the Bakkt launch on September 23 will take Bitcoin to new highs. The launch of Bakkt was announced on August 16 and from $9675 on August 15, the price jumped to $10524 within just a day – 9% increase. It did dip below $9500 on August 30, but started gaining momentum again in the first week of September.
Today, on Sept 6, when Bakkt has launched warehouse deposits for institutional investors, Bitcoin is up nearly 3%, breaking the $10,800 mark after several days of trying and heading towards $11K.
The Gigantic Spike in CME Futures
The weekly volume metrics on CME projects saw a massive increase of 600% in the trading volume. The average volume in the last two weeks was 6.85(negative) and 7.72 (positive), units respectively.
This surge signifies an increase in the interest of institutional investors in Bitcoin. Unsurprisingly, this upswing in trading volume comes at a time when the Intercontinental Exchange-backed bitcoin futures exchange and digital assets platform Bakkt is about to launch.
Also, the present politico-economic situation – US-China trade wars, upcoming Brexit, Hong Kong protests and Argentina & Venezuela’s hyperinflation, has rendered traditional investment options risky and people are turning to safe-haven assets like gold and bitcoin.
But, Why are Alts Falling?
In this Bull run, Bitcoin seems to have stolen all the limelight, while altcoins falter. Ethereum, the second most popular cryptocurrency hasn’t enjoyed the same kind of recovery from its post December-2017 bearish mood. At its existing price of $177, it is trading at just 12.3% of its all time high of $1432. The reasons for the same could be attributed to the fact that Ethereum had enjoyed a bull run in 2017 when tokens made on the Ethereum blockchain were being used for raising funds through Initial Coin Offerings. The ICO-fever fizzled out and people liquidated their ETH holdings. Now, Ethereum’s is faced with the problem of scalability which is preventing technologists from using it for serious projects. Ethereum’s market share stands at just 7% now, while Bitcoin’s is 10 times of this at 71.2%.
The third largest cryptocurrency XRP, doesn’t seem to be doing too well either. It has been in the limelight recently, but for the wrong reasons. The crypto community is accusing its parent company, Ripple, of dumping XRP in massive quantities (worth billions!) and manipulating the price of the cryptocurrency. A crypto influencer even started a petition to put an end to this practice. XRP is trading at $0.25 at present, which is just about a small fraction – about 8% of its all-time high price of $3.24.
Where is the Crypto Market Headed?
With the Bakkt launch around the corner, and both retail and institutional investors turning to Bitcoin for security in these turbulent times, the future of Bitcoin seems positive. Several crypto analysts and influencers have affirmed the same.
Max Keiser is still quite bullish about the $100k bitcoin price, and believes that the crypto market might see a new Bitcoin ATH soon since the self-acclaimed Satoshi Nakamoto, Craig Wright, doesn’t have half a million bitcoins to give to Ira Kleiman at the court’s orders –
“#Bitcoin market discounting fact that CSW never had the Bitcoin, to begin with, so he obviously can’t pay the 1/2 M coins the court is ordering him to. With that potential supply no longer an impediment, we’ll see a quick trip to new ATH. ”
Anthony Pompliano, co-founder and partner at Morgan Creek Digital, who is also known as Pomp on Twitter, recently said in an interview on CNBC that –
“In less than a decade, there is a decentralized digital currency that went basically from the fringes of the internet to now the discussions of the G-7…
Every single week we are seeing more and more institutions built around bitcoin and the crypto markets in general. Whether it’s infrastructures around hash rates, mining, support, and security network… The more institutions that are built around this, the more that it is it will never go away. And I think we are at a point now where bitcoin is here to stay and it’s gonna end up being in every institutional investors’ portfolio at some point in the future.”
He also believes that Bitcoin will hit $55,000 before the May 2020 reward halving.
A well-kown crypto analyst, CryptoWelson recently predicted that Bitcoin would go up to 17K in September. He tweeted –
However, influencers don’t have the same kind of enthusiasm about altcoins,
Max Keiser believes that the next target for ETH is $90.
Pompliano is bearish on the entire altcoin segment. He recently said that –
What do you think about the present bull run? Do you think that Bitcoin will achieve a new ATH, and the altcoins will decline further? Share your views with us in the comments!