The market capitalization of the cryptocurrency market has dropped from its all-time of over $800 billion to currently around $140 billion, according to CryptoCompare data. Many analysts claim that cryptoassets will not retain value while prominent economist Dr. Nouriel Roubini has predicted that digital currencies will disappear as he claims that decentralized mediums of exchange (MoE) have no real use case.
However, a closer examination reveals that there are developments, both business-related and technology-related, that clearly indicate that the nascent ecosystem is actually growing and evolving – and is possibly on its way to mainstream adoption.
Historically And Statistically BTC Price Has Appreciated In The Long-Term
During the period between June 11th, 2011 and November 21st, 2011, the bitcoin (BTC) price recorded a high of only $35 and a low of around $2. So, the percent (%) decrease in the flagship cryptocurrency’s price was of about 94%. It then took bitcoin 19 months to reach its next all-time high of $260 – which it did on April 10th, 2013.
In that same year, BTC price fell to $45 – an 83% decrease in its price from a high of $260. Seven months later, bitcoin was valued at $1,140 and between the time period from November 29th, 2013 to August 15th, 2015, BTC price recorded a low of approximately $150 – which was an 85% decrease (from the high of $1,140).
On December 17th, 2017, BTC price reached an all-time high of nearly $20,000 but its value has declined sharply since then to currently at about $4,256 (at press time). That’s roughly an 80% drop in the BTC price since its last high of almost $19,800.
Looking at this data suggests that historically and statistically, the bitcoin price has appreciated in the long-term, so it would be unfair to dismiss it completely as potential medium-of-exchange (MoE) and maybe one day a store-of-value (SoV).
Fidelity To Introduce Crypto Investments To 27 Million Investors
In November, the Intercontinental Exchange (ICE), the parent company of the $23 trillion New York Stock Exchange (NYSE), had planned to introduce a crypto trading platform called Bakkt – which allows users to trade in digital assets on a tightly regulated platform. While Bakkt has delayed the launch of some of its products (bitcoin (BTC) futures), it is only because there has been increasing demand from its customers and it has had to make changes to meet client requirements.
Meanwhile, Fidelity Investments, one of the world’s largest asset managers, will reportedly be offering digital currency investment options for the first time to its over 27 million investment banking clients.
Giant New York-based Wall Street investment bank, Goldman Sachs, has been strategically investing in different types of crypto-related initiatives. Notably, Goldman Sachs indirectly invested more than $400 million in February to acquire digital asset exchange, Poloniex (indirectly through its backing of Circle Internet Financial).
Digital Asset Receipts (DAR) From Citigroup
Other major financial institutions getting involved include Morgan Stanley – which aims to offer bitcoin (BTC) derivatives to over 3.5 million of its clients, which is also a first for such a large investment firm. In September, US-based multinational investment bank, Citigroup, announced its plan launch a crypto-related financial product called Digital Assets Receipt (DAR).
DARs are basically modelled off of Citigroup’s traditional American Depository Receipt (ADR) Investment plan – which allows US-based investors to own shares in foreign stocks that do not actively trade on exchanges located in the United States.
The digital assets (cryptocurrencies) are to be held by a Citigroup-approved custodian, and each DAR will be issued by the bank itself. After a client receives a DAR, Citigroup will notify a Depository Trust & Clearing Corporation (usually a Wall Street intermediary) – which will then provide settlement and clearance for the assets.