By
Godfrey Benjamin
April 20th, 2024
After Bakkt officially launched its futures contract offering yesterday, the market seemed to lose some weight, disappointing general expectations. The market is also anxious about today’s Congress hearing.
When Bakkt was first announced last year, the entire crypto community welcomed it as a great addition to the sector, hoping that it will have enough power to propel the industry considerably higher. However, even though many think it’s still a little too soon to judge, the first day of Bakkt’s launch has not exactly been encouraging as the overall market has dropped in valuation in response to Bakkt’s weak first day.
After the first hour, Bakkt recorded only about five contracts and even 9 hours later, this number was still less than 30. Furthermore, the first 7 hours saw trades of 18 BTC and even though activity on the platform has gone up since then and has now even crossed $290,000 in its total traded value, the community is still generally unhappy about the numbers and also the fact that the entire market has gone on to bleed a little. The Bakkt platform, which has been touted for a long time as the perfect bitcoin catalyst, has not lived up to expectations so far.
Most notable are Bitcoin (BTC) and Ether (ETH). The market’s leading cryptocurrency first fell by more than 1.5% to trade just a little above $9,800. Throughout the day, it seemed to fluctuate between $9,788, which served as its lowest mark, and $10,097 which was the highest point.
Currently, Bitcoin is trading at $9,779 and seems to be swinging back and forth around the region. However, a new resistance level between $9,785 and $9,790 has been set and it is expected that if Bitcoin crosses this resistance, then a re-entry back into the $10,000 mark is almost sure. It might also be important to note that a further drop down to $9,600 is also possible. If this happens, the next major support levels are $9,500 and $9,400 respectively. If the bears still win these levels, we could possibly then be looking at a further drop to $9,200.
Su Zhu, the CEO of Three Arrows Capital, a hedge fund based in Singapore, has suggested that Bakkt’s disappointing start is not surprising. According to her tweet, Bakkt will initially start slow but will most definitely pick up in the near future. Zhu believes that at the moment most brokers and traders, in general, are either not ready or quite unsure because it’s a new system and they’d like to first see how it goes.
Bakkt will be likely first a trickle and then a flood. The reality is that most regulated futures contracts get low adoption on day1 simply b/c not all futures brokers are ready to clear it, many ppl want to wait and see, the tickers are not even populated on risk systems, etc.
— Zhu Su 朱溯 (@zhusu) September 23, 2019
ETH dropped in the same period by about 0.2% to hit $207.07 but has now dropped more than 6% in the last 24%, hitting $197.06. XRP lost 1,75% now sitting at $0,27 per coin. The other altcoin which was hard hit is Bitcoin Cash, which price declined by 5,38% to reach $290,7.
Another possible reason for the market’s loss is the upcoming hearing slated for today by the US congress. As we reported a few days ago, the Committee on Financial Services chose today to thrash out issues regarding the cryptocurrency sector especially as it relates to regulation with the Securities and Exchange Commission (SEC).
Other topics expected to be discussed include Exchange-Traded Funds (ETFs), whether or not digital assets should be categorized as securities, as well as Facebook‘s upcoming Libra cryptocurrency.
It is not news that the U.S. Congress has not exactly been supportive of Facebook’s cryptocurrency because of the social media giant’s many problems regarding privacy and security. and whatever resolutions made at the end of today, might be felt in the market.