Bitcoin [BTC]’s institutional adoption depends on built ‘infrastructure’, says Blockchain CEO |
The CEO of Blockchain Inc., Peter Smith, recently stated in an interview that the cryptocurrency market will see consolidation in the next few months. He quoted his reasons for saying so as the increased entry of institutional investors into the market.
This comes after Bitcoin saw a rally above the $7000 mark after a period of extended non-volatile behavior. The coin broke the $7000 mark and continued to present a constant price above the limit.
“For the last couple of years, we have seen really rapid increases then very rapid decrease and then sort of a slow consolidation of the market. I think we are seeing another slow consolidation in the market now, there is a likelihood to see a moderate and positive consolidation over the next quarter.”
According to Smith, this cycle of the market has a good position due to the presence of regulatory clarity. This did not exist last year, he said. He also spoke about the penetration of institutional investors into the market, saying that the order flow has changed. He stated:
“Right now it’s a pretty slow retail market, historically market is led by retail. The market is seeing a pretty big uptick in the institutional market. That’s the reason Bitcoin is outperforming.”
Bitcoin still seems to be the go-to choice for institutional investors entering the market, as it is the one with the most direct regulatory approach. On this, Smith stated:
“Institutions that are coming into the market are usually buying Bitcoin first so I expect it to outperform relative to other major cryptos in the next 6 months.”
More recently, technology solutions for Bitcoin’s custody by institutional investments have emerged, such as Coinbase’s Custody solution. This is also in line with Michael Novogratz’s prediction for the state of the market, as he believes that custody solutions will drive the market. In May, he stated that Bitcoin reaching high depended on the custody solutions for digital assets, namely wallet services and private key storage solutions.
Smith said something similar, stating:
“But a lot of this has to do with the infrastructure that you build to enable some of these institutions to come into the market. There are a lot of talks of these institutions coming into the market, but I think we won’t be seeing its full effect until mid-2019.”
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