Delay of Bakkt: lack of liquidity has caused a sell-off of Bitcoin


The decision of Bakkt, the Launch of the physical Bitcoin Futures on the 24. To move January 2019, came a few days ago, in the midst of a violent downward movement, and provided within the crypto-Community for disappointment, the hoped for due to a possible increase in the trading volume on an upward trend.

Despite the disappointment the Team of Bakkt , however, strongly noted that the Bitcoin Futures take place, and that you work hard at it “all the conditions” to create, to ensure that the product of all the legal, technological and economic expectations are met, with such a major market, such as Bitcoin (BTC) are connected. The delay should, therefore, be considered not to be negative, but optimistic, as Bakkt explained in a series of Tweets.

As the world’s most liquid and widely distributed cryptocurrency, and where we’ve seen the most customer demand, bitcoin’s profile creates a liquid product on which to build, a futures contract (2/2)

— Bakkt (@Bakkt) November 21, 2018

In addition, the company explains in its FAQ, such as the price of Bitcoin is determined, as soon as the Futures are traded:

In view of the transparency and regulation of futures markets, the futures price in a one-day, physically-settled Bitcoin will serve the contract as the pricing of the contract for the market. There is no dependence on Cash is contract platforms for billing rates in the price determination for the daily Bitcoin-Future.

It is also important to note that Bakkt currencies, despite the high optimism to Bitcoin is the possibility of the Opening of Futures for other Crypto does not exclude:

We will consider additional treaties in consideration, when the landscape is developed more and we get additional feedback from customers about what they want and need.

Lack of liquidity has ensured closeout

According to Bart Smith, the head of the Department for Digital Assets when trading giants of the Susquehanna, allowed for a lack of liquidity in the Bitcoin markets, the selloff of the last few days. For the coming months, said Smith, that the admission of the Fidelity and Bakkt in the crypto currency market, the liquidity of BTC increase and an increase in capital could lead.

Currently, it is for the average Trader is quite difficult to invest on trade platforms like Coinbase in the crypto currency market. These impractical systems, such as the KYC process (Know Your Customer), according to Smith, the crypto currency market is limited to a relatively small group of investors who have a certain Expertise, to invest in the “new” asset class

Number one, access to new capital is very difficult. If you are a global Institution, it is still very difficult to buy Bitcoin the way you want it, maybe. A wealthy Person, the G. I. Generation will make a high-resolution photo of your driver’s license and take him to a Website and there send money. You want to invest with Fidelity. You want to invest in Bank of America.

Smith added that the limited number of Fiat-Exchangeses the Bitcoin markets more difficult, the growing selling pressure of the investors to absorb that because of the Bitcoin Cash Hard Fork fiasco the trust in the short-term Trend of BTC lost.

This has led to the second Problem, that was without the new paths for the new capital, the liquidity is very low. And as we have seen throughout the summer, a stable price, he was $ 6,000. The volatility was at the end of July, really low. So what happened was that in this environment, if you have a controversial Hard Fork, a degree was lost of confidence, and if these sellers come in, there is simply no liquidity to record it. Hopefully there will be Bakkt, Fidelity and other companies have enough capital to suck it up.

As #bitcoin plunges and nears $4,000, Wall Street’s Crypto King Bart Smith of Susquehanna says he’s still a long-term believer in the cryptocurrency.

— CNBC’s Fast Money (@CNBCFastMoney) November 20, 2018


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