Weekly Market Overview for October 15–21, 2018
Our previous review included an analysis of the situation with the USDT, which excited the market at the beginning of the week. Since then no significant movements were observed, so we decided to dwell in this review on fundamental events that have a long-term impact on the cryptocurrency market. Note that Bitcoin is trading at $ 6,450 on Sunday evening (according to Bitstamp), and volatility has not exceeded 2.5% since Tuesday, i.e. for 6 days.
We also recommend paying attention to the Altcoin market. In terms of technical analysis, most of these are close to significant levels of support. Perhaps we are witnessing the completion of the accumulation phase. This is particularly clearly demonstrated by the Altcoins with <significant> histories and high capitalization: EOS, NEO, Litecoin, OmiseGo, NEM, Qtum, Cardano.
Of course, there is always a chance of further decline, but it is worth considering the fact that the total capitalization of the Altcoin market (without Bitcoin) has been on the decline for the sixth month in a row. The previous record was in 2014: Altcoin’s prices kept falling for 5 consecutive months.
So, what are the significant fundamental events we are talking about? First, on Monday, October 15, one of the largest management companies, Fidelity Investments, announced the creation of a unit focused on providing cryptocurrency trading services to institutional investors. The new division was called Fidelity Digital Assets. The platform is scheduled to launch in 2019. Cryptocurrency trading services, as well as analytical and consulting support, will be available to institutional investors 24/7.
Second, the launch date of another platform for institutional investors and commercial organizations, Bakkt, was finally announced. Some sources even quote a specific date — December 12 of this year. There is already an official website of the company, which confirms that work will begin in December.
Third, large institutional market participants are preparing to enter the game. Goldman Sachs and Galaxy Digital Ventures, founded by billionaire Mike Novogratz, jointly invested $ 15 million in the BitGo cryptoactive assets storage service. The company allows you to work with 75 different cryptoactive assets, and among its clients one can highlight the Bitstamp exchange.
BitGo claims that more than $ 2 billion worth of assets is already in its stores. BitGo has become a regulated custody for digital assets in the United States.
There are also important nuances as far as statements are concerned. Goldman Sachs says that it does not plan on creating custodial solutions based on the Bakkt infrastructure. At the same time, the bank is considering the possibility of trading Bitcoin futures on this platform. This indicates the possibility of maintaining a certain degree of competition in this market. No company so far concentrates all infrastructure services single-handedly.
One can resist anything but a temptation to finish the review with a quote. Bakkt CEO Kelly Lofler: “The digital marketplace is as fragmented as the energy market in the early 2000s. ICE paved the way for an increasing number of institutions willing to trade in energy. This made it possible to form a modern liquidity market, ”Lofler notes. “We are about to witness transformations of a similar scale in the cryptocurrency market.”
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