At the time of writing Bitcoin is trading at $19,581 on GDAX — an increase of over $2000 in the past 24 hours. The cryptocurrency could easily make it to $20,000 in the upcoming days.
The launch of Bitcoin futures by the CME will attract more investors into this space and legitimize the cryptocurrency. Initially, the CME sought a margin collateral of 27%, but this has been upped to 43% ahead of their launch. Beginning December 18, TD Ameritrade will also allow their clients to trade Bitcoin futures.
Interestingly, as the demand for Bitcoin from both casual investors and retail traders increased over the past 12 months, Google has revealed that Bitcoin has been the second most popular keyword on its platform throughout 2017.
The recent rally can be attributed to a variety of factors, the two driving factors of the rise in Bitcoin price have likely been the global finance market’s anticipation of CME’s scheduled listing of Bitcoin futures on December 18 and the strong performance of alternative cryptocurrencies within the past week.
With the start of futures trading on CME, we can expect an increase in volatility. Therefore, traders should reduce their position size for the next few days until volatility subsides.
Last month, major hedge fund Man Group officially announced their plans to invest in Bitcoin and commit to the cryptocurrency market upon the completion of CME’s Bitcoin futures listing. Since such hedge funds have minimum investment values and thresholds at hundreds of millions of dollars, expect billions of dollars to be poured into the Bitcoin market in the coming months.
Although, it is important to note that Bitcoin futures trading volume in its first week was only a fraction of cash Bitcoin transactions. Futures volume has been abysmal at $60 mln per day, compared to the cash transactions of $8.5 billion each day.
It is likely that this bullish momentum will continue until the price test resistance level of $21,500. Just in case if bears overpower the bulls, the cryptocurrency may sink to below $15,200 levels.
Top Stories from the Crypto World
1. Coinbase to introduce more altcoins and maybe an IPO
In an interview with CNBC, Coinbase CEO and co-founder, Brian Armstrong, discussed how Bitcoin and other cryptocurrencies are becoming the next generation stock market.
He went into brief details on a new service which will allow traditional investors and institutions to buy and store cryptocurrencies securely.
“The ones that are the most exciting to us that we have on the platform today are bitcoin, Ethereum, and Litecoin, but there’s many more that are going to be added to the platform in 2018 and I think this is going to be a really exciting space for all kinds of institutional investors to make money,” Brian added.
After the discussions, the interview turned to the question of taking the company public as an IPO, to which Brian said, “We would be quite expensive for any exchange to look at. That being said, it is certainly in the interest of our investors…and the most obvious path of Coinbase is to go public at some point, but there’s a lot for us to do between now and then, whenever that date is.”
Why it matters: As the crypto market becomes “Stock Market 2.0”, the addition of new coins on Coinbase is a huge deal. Traders are now speculating on what particular altcoins will be added to Coinbase. It is likely they will come from the top of the market capacity charts, which tend to be the most popular coins by demand. Maybe Ripple, IOTA, NEO? Discussions on the Reddit suggest Coinbase may not include privacy coins like DASH, Monero or ZCash, because of.. well, regulations.
2. Japan and South Korea regulations are good for Bitcoin, says Charlie Lee
Over the past month, the South Korean government has been planning to impose strict regulations on the local cryptocurrency exchange market to better facilitate the growth of the industry and protect investors.
Yesterday, on December 14, the South Korean government directly refuted unconfirmed reports on the possibility of a cryptocurrency trading ban, solidifying its stance in regards to the South Korean cryptocurrency market and its intent to regulate the space.
Charlie Lee, creator of Bitcoin, in an interview, said, “I think increased regulation will help to reduce the volatility of the coin. A lot of the recent gains have had a lot to do with countries like South Korea and Japan really getting into the cryptocurrency space.”
3. CryptoKitties may lead to a whole new ‘collectables on the blockchain’ era
After its launch last week, CryptoKitties quickly became the most popular Ethereum app – so popular in fact that there’s now CryptoPuppies and CryptoPets.
While some in the crypto community are skeptical of this new trend, others see CryptoKitties as an unlikely pioneer in what could be one of the platform’s biggest applications.
Charlie Lee and Earn.com CEO Balaji Srinivasan argue that this app is actually important because it shows the promise of using the blockchain to instantly transfer all kinds of assets without a third party.
The system for creating these collectibles hinges on a technical standard similar to ERC-20, the same tech that sparked the boom in initial coin offerings (ICOs) in 2017. All the kitties on the platform are made possible by a powerful technical standard underlying CryptoKitties called Ethereum Request for Comments 721 (ERC-721).
Philippe Castonguay, developer relations manager for 0x said, “People have been talking about [ERC-721] for a long time, but no one implemented it before. CryptoKitties happened to be the first. There’s a very big market incoming for ERC-721.”