Gold 1861,41
|
EURUSD 1,2168
|
DJIA 30973,50
|
OIL.WTI 52,415
|
DAX 13927
|
|---|
The price of the first cryptocurrency has already fallen by $11,000 from its previous all-time high. While analysts are trying to predict the depth of the correction, news of great fundamental importance for BTC has come out.
BTC
The world’s largest investment company, BlackRock, has requested permission from the US financial regulator for cryptocurrency transactions. For now, the company does not plan to buy Bitcoins directly, sending them to its own or a third-party storage facility. Permission is required to trade Bitcoin futures.
In theory, of course, BlackRock could not only buy these futures, but also sell them. In reality, however, there would be no selling, as the fund simply has not prescribed in its rules the opening of short positions without coverage.
This news cannot be instantly recouped by the markets. However, it is extremely important for 2 reasons.
1. BlackRock has about $8 trillion in assets under management. If the company wanted to invest 1% of the money under management, that amount would be about 25% higher than the entire bitcoin capitalisation at the moment. If anyone thinks that the BTC market will grow in this case by a factor of 2 and 25%, that is not the case. The fact is that there is at most 5 million BTC on the market (out of 18.5 million ) that can be bought. And even if no one joins the purchases (which is impossible during a trend), the price of BTC will rise 5-10 times.
2. The second conclusion is as follows. Large investment funds and pension funds are very similar. They depend on the opinion of their investors. If the largest investment fund starts buying BTC, it means that smaller funds simply can’t stay away because investors won’t understand them. They will withdraw the money, handing it over to managers who feel the hand of the market. This is exactly what we covered in detail at the end of last year.
Perhaps at these levels, bitcoin provides one of the last opportunities to buy into a correction before storming the new $50,000 milestone.
01.30 Australian retail sales for December
04.00 Bank of Japan interest rate decision
13.45 ECB Interest Rate Decision
14.30 ECB press conference on monetary policy
Important Notes on This Publication:
The content of this publication is for general information purposes only. In this context, it is neither an individual investment recommendation or advice nor an offer to purchase or sell securities or other financial products. The content in question and all the information contained therein do not in any way replace individual investor- or investment-oriented advice. No reliable forecast or indication for the future is possible with respect to any presentation or information on the present or past performance of the relevant underlying assets. All information and data presented in this publication are based on reliable sources. However, Bernstein Bank does not guarantee that the information and data contained in this publication is up-to-date, correct and complete. Securities traded on the financial markets are subject to price fluctuations. A contract for difference (CFD) is also a financial instrument with leverage effect. Against this backdrop, CFD trading involves a high risk up to the point of total loss and may not be suitable for all investors. Therefore, make sure that you have fully understood all the correlating risks. If necessary, ask for independent advice.