Bitcoin was trading below $6,000 last week. However, things are actually looking up in the past days. The past three days played a crucial role in funneling much-needed wealth back into the industry. In the last 48 hours, the crypto market added more than $40 billion. Major cryptocurrencies such as Bitcoin, Ripple, and Bitcoin Cash all gained within the 5 o 10 percent range.
There are different reactions to this bullish market. There are those that are skeptical even expecting bears to return once again soon. In case you are wondering what is pushing the price of Bitcoin and other major cryptocurrencies up, here are some things that could be making the necessary changes.
Why Exactly Is It Moving Up?
One of the reasons why there’s an increase is the anticipation of investors to the entry of institutional investors. Though institutional investors are still not going all out, many believe that it is only a matter of time once there is regulatory clarity within the crypto market.
Coinbase, one of the world’s largest cryptocurrency wallet providers, launched Coinbase Custody. Coinbase is looking to encourage big investors to come out by making “digital currency investment accessible to every eligible financial institution and hedge fund in the world”. According to Coinbase on its website, “Over the coming weeks, we’ll continue on-boarding a set of world-class clients that includes leading crypto hedge funds, exchanges, and ICO teams”.
What exactly is Coinbase Custody? It offers both cold storage and broker services. And just last week, it started its operation and accepted first deposits from its clients. According to Coinbase, it is currently holding around $20 billion-worth of crypto assets. And another thing that may have affected the crypto market is the fact that it is still growing and planning to expand on different parts of North America, Europe, and Asia.
According to Maxim Nurov, “This is truly a milestone in the development of institutional-grade crypto market infrastructure. The demand for custodial solutions in the crypto space has been growing rapidly, as institutional investors seek exposure to this new alternative asset class”. He also mentioned that these players are carefully trying to adapt to the securities laws in order to ensure that the institutional investors’ needs are met. The US Securities and Exchange Commission clarified that Bitcoin and Ethereum are commodities while most ICOs are securities. With this announcement, businesses have a concrete idea what laws govern cryptos.
A Cautionary Approval
The European Parliament came up with a research paper that gave a cautionary approval on cryptocurrencies. The paper was entitled “Virtual currencies and central banks monetary policy: challenges ahead”. According to the research paper, it came up with a conclusion that virtual currencies are “relatively safe, transparent, and fast”.
It is true that there are still some crypto experts that are quite bullish on Bitcoin despite dipping below $6,000 last week. In fact, there is even a prediction that says Bitcoin is headed towards $50,000 this year. Is this the start of another bull run? In reality, it remains to be seen. However, it seems that there is some good news that can make Bitcoin and other cryptos experience a bull market at least for now.