Fidelity and Bakkt 2019: Institutional Crypto Investors Coming
2018 taught crypto investors so much and there is still much to be optimistic about in the New Year. The start of the year was tremendous with the price of the bitcoin hovering around 18-20k in January 2018. Since then, investors have kept their cards close to chest with the drastic drop in the value of the bitcoin. 2019 promises to be a purple patch not just for Bitcoins, but for the cryptocurrency space in general. As an investor that needs some positive news there’s one for you, there are two new heavyweights in the crypto market – Fidelity and Bakkt. These two new players have indicated that 2019 will most likely be a different year altogether. Experts have considered Fidelity and Bakkt as the major players when it comes to bringing institutional money to the market. Many questions have been flying as to how they will affect the market and the answer is they will in many ways.
The Long bear market in Bitcoin’s history has shown no signs of stopping soon which made the introduction of a largescale institutional investment like Fidelity and Bakkt inevitable.
The primary aim of Bakkt is to create an open market platform to enable users and traders store and trade crypto currencies, as they desire. Bakkt is managed by the NewYork stock exchange. They are currently forging strong partnerships with Microsoft and Starbucks to make sure that the masses have access to digital currencies. However, the ability of Bakkt to bring institutional money to the market is vital and this will provide an amazing platform for users and traders who fancy some transactions.
The major features of Bakkt includes security, efficiency and seamlessness. The combination of these features will ensure trust in the market and enable an unhindered access of digital currencies to the public. To make transactions better, Bakkt is also ETFs (exchange-traded fund). The launch of Bakkt could witness a massive adoption with up to 100 million potential users on a weekly basis.
When a major financial institution decides to get involved in cryptocurrencies is usually considered as a great news. Despite the US government’s redtape hindering the launch of serval crypto, Fidelity has manage to sneak through the hurdle. The cryptocurrency and trading platform is being managed by the famous Fidelity investment who are at the moment overseeing client’s investment worth at least 7.2 trillion dollars. The institutional crypto platform is set to manage digital currency investments and to ensure that end-users do not have to go through unnecessary difficulties. The introduction of Fidelity to the market wold also mean that investors as well as users can manage and store crypto currency without complexities. Unlike Bakkt, Fidelity is exclusive to institutional investors only meaning retail investors do not have access.
The current market challenges facing the crypto sphere calls for an urgent intervention. This has made the introduction of Fidelity and Bakkt noteworthy. The bear market is filled with lots of problems and challenges placing a lot of hope on the institutional debutants to spearhead a recovery.
Current Market Challenges
Volatility: This is a major challenge for the current market. The prices are extremely volatile and this makes it difficult for both small and big investors to stay in the market. The super surge and the sudden sink of the Bitcoin is a prime example.
Liquidity: Amidst the positive and recovery that surrounds the bitcoin at the moment, the liquidity of most currencies out there is still a major concern. Lack of liquidity makes it tough for masses to use digital currencies.
Regulation: the fact that the market is unregulated stifles growth and makes it unpalatable for an investor
Mass adoption: cryptocurrencies are a relatively new concept in terms of investment and it has suffered from being embraced by many. This combining with a poor level of awareness results in a bigger issue affecting the market negatively.
Fidelity and Bakkt on a Rescue Mission
The above listed challenges have been well digested by fidelity and Bakkt there is a lot to suggest that they can change the course of the market.
Improved security and stability: Fidelity and Bakkt are on a mission to ensure that the market remains stable. Fidelity’s Custodial Service means that users can invest in crypto without holding it directly reducing the level of risk involved. This also means that anyone can delve into the crypto space without any prior knowledge on how things work. Bakkt on the other hand are also working on a security solution that closes the gap between traditional finance and crypto. The private keys for every client’s crypto asset will be safeguarded in Bakkt’s digital warehouse with Bakkt controlling the public keys.
Mass adoption: An effective way to kick-start a new phase in the market’s development is to adopt crypto as a payment method across several platforms. This would not only improve the brand’s reputation, it also adds value to the crypto by making an actual case for it. The announcement of Bakkt’s arrival into the crypto space back in 2018 had several eye-catching details and a major one was that Microsoft and Starbucks were partners. This is an exciting prospect and perhaps, crypto enthusiasts might finally be able to trade a crypto for a cup of coffee.
Better Liquidity: The arrival of Bakkt and Fidelity will guarantee a drastic increase in capital flow. With Fidelity managing over 7.2 trillion dollars in assets, customers can build on the existing trust and both crypto platforms will attract institutional investors to solve the markets liquidity problems.
Although Bitcoin is considered as the crypto market leader, by the end of 2019 and things may be a little different. Smaller crypto are on the verge of shooting to prominence with Fidelity and Bakkt at the vanguard of the revolution.