The bullish news of Nasdaq’s partnership with VanEck has given some relief to the crypto market. Bitcoin’s price has reached $4,200 once again, and the altcoins have also started to recover. The question now is whether Nasdaq futures will be “physically” backed by BTC, as in the case of Bakkt.
The massive dump in prices, which started on November 14 due to the Bitcoin Cash war, has wiped out almost 50 percent of the market’s value in nine days. Total market cap was down by almost $100 billion on November 25. Bitcoin fell to $3,600, its lowest price since September 2017. Rocketing back to $4,200 on November 28 has given the market hope that $3,600 was indeed rock bottom.
Ripple (XRP) was affected partly by the general market movement and partly by the FUD about its lack of new xRapid customers. XRP touched the $0.324 mark, losing almost half its value since September 21 when it spiked due to announcements of important partnerships. However, today’s jump of over 10 percent pumped it back to $0.385.
Ethereum (ETH) touched $101 during the bloodbath three days ago, basically falling to May 2017 levels. However, it has regained more than 13 percent in value since yesterday, reaching a price of $119.
Recovery due to bullish Nasdaq news
The news from Nasdaq came at just the right time to provide some relief to the market. Gabor Gurbacs – a digital asset strategist/head at VanEck – confirmed the news at CoinDesk’s Consensus Invest yesterday. He said VanEck is partnering with Nasdaq, the second largest stock exchange in the world, to “bring a regulated crypto 2.0 futures-type contract” to the market. The new partners will launch the first of several futures products early next year.
According to Gurbacs, the two organizations have consulted the Commodity Futures Trading Commission (CFTC) to bring new regulatory standards to the crypto futures market. Their other strategy to inspire confidence with regulators and institutions trying to get involved in the crypto market is leveraging Nasdaq’s stock-market surveillance system, called SMARTS. SMARTS recognize suspicious activities on exchanges, such as wash trading.
As Gurbacs said, the new partners intend to:
bring to market transparent, regulated and surveilled digital assets products, such as Bitcoin futures contracts.
But will Nasdaq futures be physically settled with BTC?
Many traders have reason to be hopeful and bullish about this news. However, it’s not yet clear whether any of these products will be physically settled with Bitcoin (BTC), as is the case with Bakkt. If this is the case, that would be extremely bullish news. Right now, we don’t have that information, so the price could go either way before we find out.
Cryptocurrency trader Daniel Dabek acknowledges the possibility of a price dip, but does not expect BTC to finish below $5,526 on December 19, when CBOE expires.
— Daniel Dabek [SAFEX] (@dandabek) November 14, 2018
Adding another $1,300 to the current price would move BTC well above the dangerous levels we saw three days ago and make it easier to confirm the bottom. However, if it turns out that Nasdaq/VanEck futures are only going to be cash-settled instead of BTC-settled, we may not yet have hit rock bottom.