Bitcoin very stable during the market sell-off

The cryptocurrencies are known for volatility they have, but uncharacteristically quiet this week, trading in the $6,500 range as stock markets plummeted.


Bitcoin is up 1 percent for the week, while the Dow has dropped 3 percent with wild swings throughout the week. Bitcoin’s insulation from broader market wreckage is relatively new — earlier in October $18 billion was wiped off its market cap in a matter of days as the Dow saw its worst day since February.

Other cryptocurrencies also held up this week. Ether, the second largest in the asset class, is up 0.2 percent while XRP is up 0.4 percent. Still, Brian Kelly, CEO and founder of BKCM, said crypto investors are mostly separated from what’s happening in the broader markets.

“I don’t know of anyone saying ‘Microsoft dropped, I better sell bitcoin to cover my margin’,” Kelly told CNBC.

The relentless selling after bitcoin hit $19,000 last year has slowed down, and Kelly said bitcoin seems to have finally found a bottom at $6,000. While retail interest may be “washed out,” the market is waiting on a wave of institutional buyers, which Kelly said is “coming but it’s slow.”

Institutions are increasingly embracing the new asset class. Fidelity launched a custody solution for institutional buyers, which was seen as a missing factor many investors to enter the market. Major endowments like Yale, meanwhile, are already investing in funds dedicated to crypto and its underlying technology, blockchain. CNCB

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Mohsen Daemi
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