After a noticeable setback on Monday, cryptocurrency markets stabilized later in the week as bitcoin returned to its predictable trading range and major altcoins pared losses. The institutional pivot toward crypto was perhaps the biggest newsmaker of the week. Not only are there signs that Goldman Sachs may finally launch a bitcoin trading operation, fellow Wall Street bank Morgan Stanley heralded cryptocurrency as a “new institutional asset class.”
Institutions Flocking to Crypto?
As Hacked reported this week, Goldman Sachs could be nearing the launch of a new bitcoin trading product, with early reports indicating a limited rollout of the new offering. According to The Block, Goldman has already signed up new customers for a non-deliverable forward product that will provide cash-settled exposure to bitcoin.
While Goldman appears to still be on the fence about bitcoin, Morgan Stanley issued a bold statement earlier this week declaring crypto to be the new asset class for institutional investors. In a report titled, “Bitcoin Decrypted: A Brief Tech-In and Implications,” the bank says blockchain technology has made surprise developments in recent years, paving the way for new crypto funds that are making it even easier for investors to enter the market.
Although the bear market is showing little signs of letting up, institutions are beginning to recognize the utility of digital assets and are likely to broaden their involvement in the sector moving forward.
Tron: The Standout Performer
Tron’s TRX token managed to break even during the month of October, defying a broad market downtrend that saw the likes of Ethereum, XRP and bitcoin cash post double-digit percentage losses. As it turns out, Tron’s hype machine is turning out favorable results following several key partnerships and acquisitions being announced.
That being said, Justin Sun was recently the center of controversy yet again after the Tron founder teased another high-stakes partner. That “partner” turned out to be Baidu, one of China’s largest cloud computing companies. However, as CCN reported, Tron is just a client of Baidu and not a partner in the conventional sense of the term.
While truth twisting appears to be the norm for Sun, his project is gaining steam. One of Tron’s largest decentralized applications, TRONbet, announced first-week payouts in excess of 300 million TRX. According to Tron’s official website, the platform has onboarded dozens of decentralized applications since launching the Tron Virtual Machine.
TRX recently secured a listing on CoinSuper, a Hong Kong-based digital currency exchange, a move that induced heavier than usual volatility for the token. As Hacked reported on Thursday, TRX’s sudden and sharp rally followed by an equally large drop has all the characteristics of a pump-and-dump.
Relief Rally on Wall Street
After their worst month in seven years, U.S. stocks are rising again thanks to a series of positive earnings calls and signs of a potential breakthrough on the U.S.-China trade rift. Bargain hunters have also rushed in to snatch up tech stocks pummeled by the month-long correction.
Investor sentiment was lifted on Thursday by a tweet from U.S. President Donald Trump, who said he had a long, productive dialogue with Chinese counterpart Xi Jinping. Both sides are attempting to bridge the gap on trade ahead of a face-to-face meeting in Buenos Aires, Argentina later this month. The Trump administration is pushing to get a new trade deal done by early December and a failure to do so would lead to new tariffs being issued.
Q3 is shaping up to be another positive quarter for U.S. earnings despite several disappointing results. As of last Friday, more than three-quarters of S&P 500 companies had reported better than expected profit results. More than half said third-quarter sales were better than expected.
The Week Ahead
From the perspective of trade volume and volatility, crypto markets remain on ice. Investors’ collective lethargy is unlikely to let up any time soon as debates over securitization and regulation continue to swirl. A lack of new buyers in the market will keep prices subdued until new fundamental developments inspire capital flows back into the crypto space. At present, there’s no sign of that emerging.
That being said, long-term holders of bitcoin have grown accustomed to longer market cycles. After all, the last bear market lasted several years. The difference this time is there are more people watching and more users invested.
Disclaimer: The author owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.
Featured image courtesy of Shutterstock.