Bitcoin is maturing and imminently becoming a regular market like stocks or forex says a new study which undertakes some formal economic analysis of bitcoin’s price movements.
“While early trading was affected by system-specific irregularities, it is found that over the months preceding April 2018 all these statistical indicators approach the features hallmarking maturity.”
They argue the same likely applies for other digital currencies, such as ethereum, bitcoin cash or even litecoin, all of which have grown considerably in market cap.
Global crypto trading volumes have also increased significantly, standing now at around $30 billion, which is higher than bitcoin’s total market cap at the beginning of 2017.
Following some highly technical mathematical analysis, the study authors argue that has led to digital currencies now becoming somewhat established. They say:
“In spite of its virtual nature and novelty, the Bitcoin market has recently and rapidly developed the statistical hallmarks which are empirically observed for all ‘mature’ markets like stocks, commodities or Forex.
It appears plausible that other cryptocurrencies will follow the same trajectory. This may lead to the emergence of a completely new market, analogous to the the global foreign exchange (Forex) market, wherein cryptocurrencies could hypothetically be traded even in a self-contained manner.”
This may be partly due to some institutional investors entering this space. That includes Soros, the Rockefellers, and so on. But it also includes pension funds, albeit at a relatively very small scale.
Canada’s biggest pension fund, for example, has created a publicly traded stock company that will directly buy eth and invest solely in the ethereum ecosystem.
While Goldman Sachs has hired a former crypto trader, Justin Schmidt, to explore potentially creating a bitcoin trading desk.
That might suggest investment banks might be moving into this space, or might start doing so at a more significant relative scale, to perhaps benefit from considerable potential gains.
Which might suggest cryptos are entering the second stage. Out from relative obscurity to now being a somewhat “serious” stock market with the “big players” potentially starting to move in.