After soaring from $3800 to $52000, Wall Street still looks like a special coin

Source: CICC Block Tianyan app: after soaring from $3800 to $52000, Wall Street is still optimistic about bitcoin. During the Spring Festival, bitcoin is still the world’s largest asset. As in the past year, the value of a bitcoin rose more than $52000, and the increase during the Spring Festival was close to $10000. In March 2020, at the beginning of the outbreak of the world’s new crown epidemic, gold was discarded and investors only wanted us dollar liquidity, and bitcoin fell into the abyss. The lowest price of a bitcoin dropped to nearly 3800 US dollars. Nearly 11 months later, bitcoin has rebounded by more than 1200%. Even if it breaks through $50000, the bullish sentiment of the international market for crypto assets is still high. After Musk’s Tesla announced a $1.5 billion investment in bitcoin on August 8, bitpay announced that its MasterCard prepaid card users can now connect to Apple wallet to pay for goods and services with apple pay. The main payment companies that support encryption are still launching encrypted payment services. Apple pay currently has 380 million users, while bitpay currently supports BTC, ETH, BCH and a variety of stable currencies for payment. Bitpay is also looking for more partners, such as Google pay and Samsung pay. Recently, the Ontario Securities Commission (OSC), the Canadian regulator, announced that it would approve the asset management company purpose investments Inc. to launch a pure bitcoin ETF on the Toronto Stock Exchange and trade under the BTCC code. BTCC will directly invest in bitcoin for physical delivery rather than related derivatives. Institutional analysis believes that the gradual promotion of ETF will be an important driving force. The US Securities Regulatory Commission (SEC) has repeatedly rejected the application of bitcoin ETF for many times, with the main concern that it cannot “prevent fraud and manipulation” and “protect the interests of investors and the public”. Specifically, in order to prevent market fraud, ETF initiators and regulators can enter into fraud monitoring agreements with cryptocurrency exchanges to properly monitor and prevent price manipulation, but this requires that the trading volume of such exchanges is large enough. However, in the past few years, most bitcoin exchanges are not regulated by the SEC, and the trading volume of exchanges regulated by the US government (such as coinbase, Gemini, Kraken) is not large enough, and bitcoin options of CME are only launched at the end of 2017. But today in 2021, the market situation has changed. The scale of CME’s bitcoin futures contract market is large enough. For example, according to skww’s latest data, the contract position has reached US $2.2 billion, ranking first in the bitcoin derivatives market; the business volume of the US cryptocurrency exchange is also growing, and they are all preparing to go public. The bitcoin market is more mature than it was a few years ago. In contrast, the bitcoin trust (GBTC) product of gray fund can be said to be a “castrated version” of bitcoin ETF. There are two main differences between GBTC and traditional ETF funds: firstly, there is no redemption mechanism for GBTC. Since October 28, 2014, the gray bitcoin trust has suspended its redemption mechanism. Although the GBTC of gray fund has passed the regulatory approval, it still has not submitted the redemption plan to the SEC; secondly, GBTC requires to lock the position after the purchase. In the traditional ETF fund trading, t + 0 trading can be realized between the primary and secondary markets. However, the current GBTC’s primary market share can only be sold in the secondary market after six months. Bitcoin ETF is better both in terms of gold content and the convenience of subscription and arbitrage. In addition, Cathie wood, the Ark’s investment manager, who made 190% a year with heavy bets on Tesla, disclosed in a filing with the US Securities and Exchange Commission that Ark’s holding of GBTC was worth $357.5 million. According to ark, if all companies in the S & P 500 allocate 1% of their assets to bitcoin, the price of bitcoin will increase by about $40000. The rapid rise of bitcoin makes it have a place in the asset allocation of institutions. Ark estimates that within four years, the daily trading volume of bitcoin will exceed that of the US stock market, and within six years, it will exceed the global spot foreign exchange market. Ruchir Sharma, head of emerging markets and chief global strategist at Morgan Stanley, said recently that the open source software behind bitcoin makes it more transparent, transferable and trustworthy than government printed paper money. At the time of the outbreak, the US dollar was the world’s preferred reserve currency. However, led by the Federal Reserve, central banks are frantically printing money to keep the economy running during the pandemic, undermining confidence in all national currencies. In 2020, 20% of the dollar in circulation will be printed, which is a huge boost to the attraction of the special currency. Last year, popular payment platforms began to embrace bitcoin and other digital currencies, an important step in their campaign to challenge the dollar.

Leave a Reply

Your email address will not be published. Required fields are marked *