Summary
- Bitcoin took a hit following the Fed’s remarks, but a resurgence is ongoing.
- Institutional adoption of BTC will keep on rising due to the strong traction built.
BTC was fighting its way out of the woods today, following the slip below $55,000 that was triggered by an unflattering statement from the Fed chairman Jerome Powell. At the time of writing, BTC/USD had climbed back to $56,401. Bitcoin has recently built strong institutional interest and will likely overcome the current tumult.
Institutional adoption of Bitcoin
The cautious approach to BTC by some institutions is a limitation to its growth. There is a general discord of opinions as to whether Bitcoin has an actual intrinsic value as an investment asset for large institutions.
In the latest development, the head of Fidelity Investment, Mike Durbin, recently stated as much. He said that even though BTC price keeps on surging, most firms managing wealth were struggling to know more about this digital asset. Durbin further added that for investors to be comfortable with blockchain technology, further action needs to be taken.
In better news for BTC, recently, Time Magazine has revealed plans to incorporate digital currencies, including Bitcoin. The news is a publicity boost for cryptocurrencies, going by the influence commanded by the magazine around the world. The publicity company went further and placed a job advertisement on LinkedIn, seeking to recruit a CFO who is knowledgeable in cryptocurrencies.
These moves could be a pointer that Time Magazine is getting ready to invest in the assets. Time has already announced that it will begin accepting payment in digital currencies for its digital subscriptions in the next 30 days. In another development, Time will issue its NFT tokens through Superrare.
The fightback from regulators and policymakers
Earlier this week, US Fed Chairman Jerome Powell issued a somewhat mixed indictment on BTC. Powell was of the opinion that BTC could potentially replace gold but is too volatile and has no backing and can therefore not replace the US dollar. He further derided BTC, stating that it cannot be considered a store of value.
The limitations facing Bitcoin’s acceptance by regulators and governments continue to emerge. Morocco has recently banned BTC and other digital currencies. Despite the ban, the Moroccan citizens have continued to trade in digital currencies. Additionally, Morocco’s Central Bank is considering adopting Central Bank Digital currencies even though BTC and altcoins ban has not been lifted.
Similarly, the Government of India is preparing a bill to institute punitive actions against the holding, trading, and use of digital currencies in the country. Further to that, the government is also considering blocking IP addresses of crypto-exchanges. Nonetheless, there is still widespread use of digital currencies in India.
While governments will likely continue to issue negative publicity on BTC, it has garnered enough traction to continue to attract institutional interest.
Digital currency fraud
As the value of Bitcoin increases, cases of fraudulent acquisition of the cryptocurrency keep on rising. Authorities in Hong Kong are currently holding a suspect who scammed two individuals in a BTC transaction worth nearly $500,000.
Similarly, authorities in the United States have indicted Sky Global. The Canadian telecoms services provider stands accused of laundering money with digital currencies using encrypted phones.
The continued use of digital currencies in the black market and criminal world are an existential threat to their acceptance by governments and increase chances of an outright ban on them. This could adversely affect BTC prices.
BTC/USD technical outlook
The price of the BTC/USD pair is currently trading below the $58,000 pivot level. BTC will find support at $ 53,937, while the first resistance level will be established at $57,697. A break above the resistance levels will drive the price of Bitcoin above $58,000.
