Bitcoin (BTC) Continued Rise Precursor for Regulation

Bitcoin continued rise could attract more regulation as authorities around the world become intrigued. According to Galaxy Investment Partners CEO, Michael Novogratz, regulators are becoming increasingly nervous as the digital currency continues to hit record highs.

Bitcoin Regulation

The sentiments follow yet another record-breaking spree that saw the largest cryptocurrency record its biggest single-day gain of $2,500. The digital currency has since risen to record highs of $14,000 and showing no signs of slowing down.

Given the impact that the cryptocurrency is set to have especially in the financial sector, the former Fortress hedge fund manager, believes regulations may be inevitable.

“One of the big risks out there right now is that prices are moving so fast that regulators are going to get nervous. I could legitimately see bitcoin go $13,000, $14,000, $20,000, $25,000 and see somebody balk,” said Mr. Novogratz.

However, Novogratz has warned that it won’t be easy for regulators to have control over the havoc-causing cryptocurrency.  According to the Executive Officer governments, regulation could take much longer to have a significant impact.

Novogratz is planning to launch a $500 million fund focused on cryptocurrencies investments. According to the Hedge Fund manager, bitcoin is winning mostly because of its underlying technology and not its digital currency credentials

“Bitcoin is winning out as digital gold. I don’t think it’s going to be a currency.… Nothing that volatile is going to be a currency,” said Mr. Novogratz

Bitcoin Futures Impact

Bitcoin has soared by more than 1500% this year. The surge has catapulted it from being just a fringe asset to being a globally traded product. However, it faces its biggest test heading into the year-end as some of the biggest exchanges in the world introduce Futures Derivatives.

Kick-starting the Futures spree is CBOE which is set to launch its own Bitcoin Futures over the weekend. CME Group is set to follow suit before the Christmas holidays as the NASDAQ exchange prepares for its Bitcoin exchanges in the summer of 2018.

Bitcoin has mostly been on the rise with slight pullbacks. However, with the introduction of Futures contracts, it will be much easier to bet on declines as Hedge Funds make an entry. For long, the digital currency has risen on the speculation of bullish traders but with institutional investors entering the foray the landscape could significantly change.

Even though there are traders that are waiting for the Futures contract to go short on Bitcoin, there are also those that plan to use the opportunity to go long. It awaits to be seen what will be the result given that talk of bubble burst around the cryptocurrency has been gaining momentum in the recent past.

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Disclaimer: This article should not be taken as, and is not intended to provide, investment advice. Please conduct your own thorough research before investing in any cryptocurrency.