It’s been another crazy week in crypto land, the big news of course being the SEC’s statement on Ethereum not being a security, the Coinrail hack whereby roughly $40 million US Dollars were stolen, the damning report regarding Tether and the much-awaited EOS mainnet launch.
The SEC’s stance on Bitcoin and Ethereum is undeniably bullish which fills us with confidence regarding future cryptocurrency policy and regulation in the United States – it is a good outcome.
We’re still not out of the woods yet however and for many ICOs and altcoins, the story could go very differently – like ending with a securities classification.
This would mean that the issuer of the ICO, the exchanges who listed (and continue to list) the coins and in some cases, even investors would need to register with the SEC and pay up. Just this year, Merill Lynch was fined almost $1.8 million for engaging in the sale of unregistered securities.
In the event such a ruling did happen, we would likely witness an aggressive sell off as various exchanges delisted coins or perhaps shut down altogether.
It wouldn’t be pretty but it would draw a line in the sand, providing much needed regulatory clarity and legal precedent.
It is always important to acknowledge the downside risk but the SEC’s comments are a positive step forward and one which the CryptoInMinutes team welcome.
The price of Ether did pump more than 10% off the back of these comments but unfortunately, continues to be weighed down by the prevailing bearish trend.
It is worthy of note that CBOE has since announced their interest in launching Ethereum futures.
As we have stated numerous times, on a technical level we are (unfortunately) still bearish and expect further downside with a likely 3K target on Bitcoin before seeing a potential sector-wide reversal.
With that being said, we are fundamentally becoming increasingly bullish. We continue to hear rumours about large OTC orders being made by large institutions and we should not forget that some of the world’s biggest companies and financial organisations are coming on board to use blockchain and cryptocurrency – we have listed just a few of many examples below:
Goldman Sachs – developing a dedicated cryptocurrency department and trading desk
New York Stock Exchange – building an institutional Bitcoin exchange
Santander – using the Ripple blockchain for 50% of international transactions (not using XRP)
Barclays, CIBC, Creduit Suisse, HSCBC, State Street – pledged support for the UBS utility coin
IBM – Developing Hyperledger payments system and has partnered with Stellar Lumens
Microsoft – accepts cryptocurrency payments, partnered with IOTA and recently purchased Github
Soros Fund Management – has stated they will start to trade cryptocurrencies.
There are also many less serious but for different reasons, equally important examples of cryptocurrency uptake in the corporate world – Burger King launched Whoppercoin, KFC a bitcoin bucket and Kodak’s share price was resurrected when they launched their ICO KodakOne, an image rights blockchain application.
The CryptoInMinutes team do not think that blockchain or cryptocurrency are fads and as innovation continues to happen within this fledgling asset class, we expect to see mainstream adoption on a retail, institutional and sovereign basis continue to grow.
Markets move up and down but progress moves in one direction – we firmly believe distributed ledger technology and cryptocurrency have a bright future ahead.