Bitcoin Pulls Back from Three-Week Highs After Rapid Ascent; Bakkt Postponed Again?
Bitcoin drifted back below $4,000 on Saturday as part of a market-wide correction following the recent surge of double-digit growth. Although not out of the ordinary, the pullback risks undermining the recent wave of bullish momentum that swept cryptoassets to nearly one-month highs.
Cryptoassets accumulated more than $30 billion this week. Read more in our Week in Review: Crypto Rally Gains Steam, Western Union Open for Business and Facebook Dabbling in Stablecoin.
Bitcoin drifted lower late Friday before consolidating in a narrow range over night. The decline would resume around 05:00 UTC amid a sharp drop in trading volume. The bitcoin price now resides in the $3,830 range on major exchanges like Coinbase, Bitstamp and Bittrex. It was trading hands at $3,981 on Bitfinex, which normally sees a large premium on BTC/USD.
The CoinMarketCap data feed shows an average price of $3,888.80 at the time of writing. That’s a decline of 4.3% over 24 hours. Trade volumes declined from around $8.2 billion to $6 billion, which is still well above the recent norm.
Bitcoin experienced rapid acceleration between Tuesday and Thursday of this week, catapulting prices to fresh three-week highs. The leading digital currency added 25% in a matter of days, which helped engineer a much bigger recovery in the broader market.
Although bitcoin peaked above $4,200, gains north of that level have proven harder to justify in the current bear market. To keep the relief rally alive, the bulls need to generate bids north of $4,500 and, eventually, $5,000.
Bakkt Postponed Again?
The launch of Intercontinental Exchange’s cryptocurrency trading platform could get delayed again as it awaits regulatory approvals from the U.S. Commodity Futures Trading Commission (CFTC). Bakkt, which plans to offer physical bitcoin futures to institutional investors, could get delayed by another week or more given the timeline for approvals.
As Hacked reported last month, Bakkt was scheduled to go live in mid-December before being pushed back to Jan. 24.
One of Corporate America’s largest crypto ventures, Bakkt is looking to streamline adoption of bitcoin payments among institutions and consumers. Institutional partners like Microsoft and Starbucks have joined the effort to take crypto mainstream.
There are several theories as to how Bakkt will influence the bitcoin market. What separates this platform from similar futures markets is the fact that, with Bakkt, contracts are settled with physical bitcoin as opposed to cash. Physical delivery essentially provides investors with asset custody, which may boost their appetite for digital assets. If that’s the case, Bakkt could have a significant impact on the supply/demand balance of the existing market.
Disclaimer: The author owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.
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