Ever since Bitcoin began plummeting from its late-2017 highs of nearly $20,000, the crypto community has been looking towards institutional and corporate investments as the next potential source of capital that could lead the markets to surge back towards, or above, their all-time highs.
Despite this, the Bitcoin ETFs that many investors were looking towards are still showing few signs of being approved, and institutions haven’t been quick to jump into the markets. Although Wall Street entering the markets would certainly be positive for crypto prices, investors ought to remember that the overall market cap climbed to over $800 billion on speculation alone, and this could certainly be replicated again.
Wall Street Not Interested in Crypto… Yet…
Although the 2017 crypto bull run did spark Wall Street’s interest in the nascent markets, the ensuing crash appears to have smothered this spark, with Goldman Sachs tepidly moving away from their plans to open a Bitcoin trading desk due to weak customer demand and regulatory issues.
New York Stock Exchange parent company – ICE – has also been forced to delay the release of the Bakkt cryptocurrency exchange on multiple occasions due to regulatory red tape.
While speaking to The New York Times, Paul Chou – the founder of crypto exchange LedgerX – explained that institutions simply haven’t moved into the markets in the way that he had previously expected them to.
“It was definitely part of the original plan that institutions would be a big part of this market… We were wrong,” Chou explained.
Ciaran Murray, a cryptocurrency trader in London who once attempted to start a crypto hedge fund, also discussed the lack of “smart money” in the crypto markets, noting that the details about the nascent markets scared them off.
“The smart money knows that crypto is not ready… Once you get into the details, it scared them off,” he said, further explaining that he doesn’t expect the speculative nature of the markets to change for three or four years.
Crypto Markets Can Skyrocket Regardless of Wall Street
Because the cryptocurrency markets were able to skyrocket to over $800 billion on speculative investments alone in 2017, they can certainly climb back to this level again without any Wall Street funding.
At the time of writing, the total crypto market cap is roughly $163 billion, up from its 2018 lows of under $100 billion. Because the markets have mostly seen positive price action since the market cap dropped below $100 billion, it is likely that this level could very well mark a long-term bottom.
Late yesterday, the entire crypto markets surged, putting further distance between their current price levels and their 2018 lows, which strengthens the bull’s case for an imminent bull run.
Assuming that the markets are able to begin climbing back towards their 2017 highs, the institutions and corporations that lost interest in the industry over the past year will likely be drawn back in, which could help the markets surge even higher.
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