Binance Research: Bakkt to Blame For September’s Bearish Performance
The crypto industry lost significant momentum during September. Binance Research claims that one of the potential reasons for this may have been people ‘selling on the news’ of Bakkt launching.
Bakkt Launch Fell Flat
Most notably, on September 23, 2019, Bakkt Bitcoin futures contracts started trading. However, what was hoped to be a groundbreaking moment for the market turned out to be a massive anticlimax.
One of Bakkt’s promises is to bring institutional investors into the crypto market. For Bakkt CEO Kelly Loeffler, Bakkt launch represents “a milestone for the industry.” She also wrote,
As institutions enter this emerging asset class, they will continue to look to secure infrastructure and the regulatory certainty that it provides. Importantly, these futures contracts now serve as benchmarks established by a trusted price discovery process upon which investors can rely.
On the other hand, JPMorgan strategists argue that “the Bakkt flop is directly linked to the steep cryptocurrency market crash.” Likewise, the Binance Research report suggests that Bakkt is to blame for Bitcoin’s price drop. According to the report,
One possible reason, explaining Bitcoin’s price drop, could be the general indifference towards the much-hyped release of Bakkt, as BTC prices dropped over $1,000 a day or so after trading began… Short-term wise though, Bakkt’s disappointing start seems to have been a contributing factor to the recent price decline.
Nevertheless, the Binance Research team remains optimistic. It believes that better days are coming for the crypto industry. According to the researchers,
“October 2019 promises to be an exciting month with many questions waiting to be answered. Will gas fees on Ethereum keep increasing? Will the Telegram Open Network launch? Where will the Bitcoin dominance head to?”
Binance Continues to BUIDL
Binance Research recently released its September 2019 market overview report, which highlights the flatness that characterized the crypto industry for most of the month. And it points out to the fall of the crypto market that occurred on 24 September.
Indeed, in September, the total valuation never rose above $300 billion. Aat the time of writing, the crypto total market cap remains below $213 billion, as TradingView reports.
Nevertheless, the report underlines, the crypto industry kept pace with the development and creation of new derivatives platforms and other crypto financial products.
The report draws attention to the two derivatives platforms that the cryptocurrency exchange Binance launched during the month under review.
On September 2, Binance announced the acquisition of the Bitcoin futures and Crypto options trading platform, JEX. A few days later on September 13, the exchange launched Binance Futures.
Moreover, in September the CME Group reiterated that it would launch options on Bitcoin futures in early 2020.
How do you think Bakkt and other crypto-based products will help Bitcoin go mainstream? Let us know your comments below!
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