Some very positive news has been coming out of the cryptocurrency market this week showing signs that digital currency and blockchain tech are set for a prosperous 2020.
With the current doom and gloom shed over the recent drop in crypto prices, it can be difficult to stay positive in such a volatile market. However, several key news reports released over the last week shows companies such as Ripple investing in the future of its borderless transfers and payment system, Bakkt’s BTC futures are finally on the rise, and German banks have their eyes on getting involved in the sale and custody cryptocurrencies.
Our main topic for the week is the rise of Bakkt’s BTC futures and why there has been a sudden increase in trading volumes after such a disappointing entrance onto the cryptocurrency scene. Also, for all those that are wondering what the halving of BTC may bring next year, we have gone into some detail to explain how the up and coming event may be affecting investor decisions, and the possible effect it will have on the value of BTC in the future.
All in all, investments are still are going strong and financial firms are showing interest in becoming part of the cryptocurrency circle with news laws waiting to be passed in order to pave the way for financial success.
Back in September, we reported on the opening of the fiat currency backed Bakkts futures market having an effect in the future of Bitcoin. There was a lot of hype prior to its launch, but the launch was disappointing with much lower than expected trading volumes reported on the platform's opening day and thereafter. You can read more about the Bakkt Bitcoin futures market here.
Last week Bakkt’s Bitcoin Futures reported $40 million of volume trading. This was a stark contrast to what have seen from a concept that was supposed to change the face of the cryptocurrency market; particularly for BTC investors. Every day last week $20 million in futures were put up giving us a hint that suddenly there is a lot more interest from trading institutions.
One of the reasons for the sudden upsurge is likely due to the recent price declines in BTC value that have fallen well short of most investors’ expectations. However, and as we have reported on several occasions, Bitcoin is due to halve in May 2020 which is predicted to raise the value of the world’s most mature cryptocurrency. With the price being low, and the halving fast approaching, it seems like a very good time for investors to get their money in now.
The easiest way to explain this is by using fiat currency. Central banks can order their mints to print/produce more cash at will these days. The more physical cash, the less the currency is worth as there is so much of it. This is simple economics at work using the concept of demand and supply. The more physical cash, the less it is worth. This is exactly the same with commodities – the less rare the commodity is or if the commodity is in abundance, then the less value it has because it is easily obtainable.
On the other hand, the scarcer a commodity is, the more it is worth. The theory is that supply can just about or barely keep up with demand meaning higher prices can be charged because people are willing to pay it.
The same is expected to happen with Bitcoin. The blocks that miners can mine will be halved, and therefore less BTC will be mined. Right now, the block reward is 12.5 BTC, and when it halves it will be 6.25 BTC. With around 4,380 blocks mined every month right now the value is roughly $260,000 a month. Halving BTC blocks will mean $130,000 per month will be mined.
As algorithmically only a set number of BTC can be mined, which mining is expected to be completed by 2140 for your information, this means that BTC cannot just print more money like the banks can. As such scarcity of BTC will kick in with theorists saying that the halving will have a positive increase in BTC’s value.
MoneyGram has long been associated with Ripple as reported by CNBC.com in January 2018. The transfer giant saw the potential of cryptocurrency almost 2 years ago and it is still going strong on its mission to make cryptos a part of their future operations.
MoneyGram has been using XRP to speed up payments as well as reduce the costs involved with borderless transfers. Ripple has obviously seen the fruits of their partnership with MoneyGram as very positive because the blockchain tech firm injected $20 million in exchange for shares on the NASDAQ listed firm. At the time, MoneyGram shares were worth $3.00 each, but Ripple bought the shares at a rate of $4.10 per share. This comes after Ripple injected $30 million in June this year as part of a promise to inject $50 million into MoneyGram.
Now Ripple has kept its investment promise and also has a vested interested in the success of MoneyGram’s future seeing as the firm now owns shares that were purchased at an inflated price. For anyone out there interested in both stocks and crypto investments, there could be something here to investigate as a long-term investment opportunity as Ripple obviously seem confident in MoneyGram’s future.
Who said that cryptos are dead? Yes, the market is fluctuating, but as we reported last week, BTC’s ‘Parabolic Uptrend Is Still Intact’. In short, BTC’s expected value at this stage in its existence, as with a good number of other cryptos, is exactly where it should be despite its volatility.
If you were wondering whether all this talk of parabolic uptrends is all huff and puff after seeing the recent declines in crypto values, then maybe this piece of news will help you change your mind.
Now we all know the German’s have a keen eye for investment. Furthermore, German financial institutions are not known for taking uneducated risks on a whim. It is fair to say that financers from Germany are some of the shrewdest investors on the planet, and so when you hear that a German bank is waiting in the sidelines for their call to come and join in on the action, it is worth taking note.
There is a bill in the European nation on the verge of being passed that will give EU banks the go-ahead to become involved in the sale and custody of Bitcoin as well as a few other selected virtual currencies. The only catch is that 16 German states will need to agree and sign off on the bill so German banks can legally become involved which is expected to happen early next year.
German banks are keen to offer services that will allow their customers to access stocks, bonds, securities, cryptos, and online banking facilities at the touch of a button. If the 16 states do sign off, the overall effect and positivity that will surround the passing of this bill should see another increase in cryptocurrency values as one of the world’s leading financial markets joins the crypto sphere.
BTC may well be dipping and rising unpredictably, but investment and interest in the cryptocurrency financial market are not flailing. German banks and big-name money transfer firms are still hot in the running angling their business models to cater to the continuous rise of cryptocurrencies into the mainstream financial world. We have also had a hint that investment banking firms are taking advantage of low BTC prices in lieu of next year’s halving of BTC which is the likely cause for the sudden upsurge in trading volumes on the Bakkt Bitcoin futures platform.
The future looks bright, and as we lead our own way into another new decade where crypto prices remain uncertain and volatile (which is great news for experienced day traders by the way), the businesses surrounding the cryptocurrency market remain bullish with their investments. If you were to bet on the success of the cryptocurrency market, you would not be wrong to follow news related to investment firms jumping in the bandwagon as a positive sign for 2020’s crypto market as a sign to invest.
As always, here at mBit, our cryptocurrency news team will remain visual picking out news reports for the one-week crypto news report that will give you insights to both the highs and lows of the business element surrounding cryptocurrencies.
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