From memes to realities, we can’t escape the fact that we’re in the thick of the bear market. The crypto market is so cold our feet are frozen. Wait, remember when someone launched an NFT collection about feet? Anyway, the bear is still here. But, Bitcoin has passed the $30,000 mark – its highest since April. So, why is Bitcoin pumping?
Why Is Bitcoin Pumping? TradFi.
Not a while ago, SEC chair Gensler said, about Bitcoin, “We don’t need more digital currency, we already have digital currency. It’s the US dollar, the Euro…”
But, recently traditional finance companies are driving toward crypto with full force.
Blackrock Files for a BTC ETF
A Bitcoin exchange-traded fund (ETF) tracks the value of BTC. They can be bought, sold, and traded on traditional stock markets instead of crypto trading platforms. These ETFs have to be approved by the SEC.
BlackRock is the world’s largest asset manager having over $8.5 trillion in assets under management. It has recently filed for a BTC ETF. However, multiple companies have filed for a BTC ETF, but all were rejected. But since BlackRock is a big name in traditional finance, many assume that the SEC will accept its application.
Regardless, this move alone means that traditional finance is seeing potential in cryptocurrencies and specifically in Bitcoin. This also pushed another large asset manager Invesco (IVZ) to reapply for a BTC ETF.
EDX Crypto Exchange Goes Live
Fidelity, Citadel, and Charles Swab, another three big names in traditional finance, launched their own crypto exchange EDX Markets.
EDX Markets CEO Jamil Nazarali wrote on LinkedIn. “EDX’s official launch allows our outstanding team to bring to crypto the same values and standards of competition, transparency, fairness, and safety that investors in traditional assets expect and enjoy.”
Moreover, Abigail Johnson, CEO of Fidelity Investments, has been mining Bitcoin since 2014.
But, Why Now?
Again, earlier on, Gensler practically demonized cryptocurrencies and those who trade them. He even stated that there is no need for such digital currencies and current currencies are enough. How come the boat is heading toward Bitcoin?
I mean, even FED chair Jerome Powell said that “crypto appears to have staying power as an asset class”. He did point out Bitcoin’s volatility but he didn’t deny its potential.
Well, there is a theory going around that this was the plan all along.
- Shit on crypto so the market goes down.
- Join the market at an affordable price.
When you look at it from this perspective, it does indeed make sense. When you bash something, that thing will drop in value especially if you’re in a place of power. And, it’s the perfect time to join something when its price is down. So why not orchestrate the whole thing? Maybe because it’s not ethical but oh well.
Does Bitcoin Pumping Indicate a Bull Run?
Calm your horses, we’re not in a bull run yet. I’m not particularly saying that we will never see one but we’re not witnessing one right now. All of this new blood in the crypto space doesn’t mean that Bitcoin is going to the moon.
These companies may not be seeing any specific long-lasting value in Bitcoin anyway. Why are they putting in money then? Because they want to make money. And, if the market goes back up again, they want to be the ones who own it.
New developments have also been introduced to the Bitcoin blockchain such as SATS that also are contributing to the pump. It’s not solely TradFi companies driving the roller coaster.
However, the actual core of the $30K jump is FOMO. Many are seeing diverse companies chipping in, prices going up, and they don’t want to miss out. Be aware, though. FOMO often leads to dark places.