After weeks of getting battered, Bitcoin and the rest of the other cryptocurrencies are up again. Bitcoin jumped by 6.5% to get back above $4,000. This has been the highest point for the cryptocurrency. In just a few minutes, Bitcoin spiked from $3,800 range to above $4,000. Ripple, Bitcoin Cash, Litecoin, EOS, as well as Stellar also had its share of short-term burst as altcoins jumped by 3 to 12 percent on the same day.
Short-Term Jump
Will there be another bull run? This has been the question in everyone’s mind. Clem Chambers who is an author on crypto trading mentioned that “Bitcoin will boom again in a year and blockchain/cryptocurrencies and other applications will define the next 25 years in the same way as online/dotcom has defined the last 25 years”. He also added that “Bitcoin is the tip of the spear and the tip of the iceberg. In both cases you want to be at the right end of it and you don’t want to have the wrong positioning as it emerges”.
With regards to the current jump, Bitcoin has been hovering its market cap between $100 to $140 billion. For a lot of traders, they believe that Bitcoin has to jump above $180 billion in order to have another rally. However, even if Bitcoin’s market cap reaches $200 to $250 billion, this could still make the market vulnerable to bearish trends.
So what exactly caused the recent jump? There are a number of reasons why the entire crypto market had a jump. For instance, Bakkt is going to be launched this month and the US Securities and Exchange Commission is about to make its decision on the Bitcoin ETF application by VanEck. And also, you have the recent development of Nasdaq’s Bitcoin futures. Is Bakkt enough to bring back Bitcoin to its glory days? Will the SEC even approve a Bitcoin ETF?
Institutional Investors Entering the Crypto Market
Experts believe that these are the things that can help get crypto investors to be more involved in the industry. However, there are analysts who are pessimistic about the current crypto climate saying that it could alienate institutional investors.
There are a number of issues that have to be addressed. For instance, you have regulatory issues, compliance, as well as security issues that could all contribute to having institutional investors enter the market.
In fact, SEC Chair Jay Clayton mentioned before that the agency is only comfortable approving a Bitcoin ETF only if crypto exchanges invested in surveillance tools. So far, Gemini has been the only one using surveillance tools used by Nasdaq. Months ago, the agency rejected a number of Bitcoin ETF citing the possibility of price manipulation in the market.
Banking Integration
The good news is that there’s an increase in banking integration. According to Henri Arslanian who is a top executive from PricewaterhouseCoopers (PwC), he believes that there will be institutions coming this year. In his tweet, he believes that the market is going to mature from “toddler to growing up”. He also predicted that there will be more regulations this year while ICOs are going to be out.
The SEC has started hunting ICOs. The regulatory agency even took on celebrities that promoted coins that are considered unregistered securities. Is the jump going to be a regular thing? Or is this something temporary?
