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Author Topic: Is institutional capital good or bad for Bitcoin?  (Read 1001 times)
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December 07, 2017, 06:43:06 AM
 #1

The debate is still on-going if large investments from institutional firms, would be good or bad for Bitcoin in the long run. Some are saying it will bring more volatility <price manipulation> and others are just happy that the price will probably go to the Moon.

There are also conspiracy theories doing the rounds that these institutions will use their financial powers to destroy Bitcoin. <Buying large quantities and also dumping large quantities>

Some are even saying that the small fish will be eaten by the big sharks. Let's consider the impact of this and how this will change the Bitcoin scene.

Will Bitcoin go 100% commodity & store of value or will it still be used as a currency? 


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February 05, 2018, 09:10:46 AM
 #2

I believe its has both good and bad effects. Good because such institutions would be putting up their investment in bitcoins which means they also knew that there is a big opportunity to earn from it. While on the other hand it would be risky too because there is a possibility of monopolizing the current market due to its high demand in the market.
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February 05, 2018, 10:03:27 AM
 #3

Institutional money flows into assets that are expected to have growth in the long term. This growth is dependent on whether the product/ asset has a market or not. The market depends on the people who are using it. It depends on whether big merchants are going to accept it as a way to fund their commerce activities.
The upside for the common people to use it or store is that its non-deflationary, its value will not depend on government intervention, it will be secure and decentralized in the long run.

This current flow of money is probably just the thing that we fear. Big investors trying to make money off of small investors who scare easy by these constant buys and dumps. It may also just be your average big-pocket traders. I don't think we should worry about it too much.

The fundamentals of bitcoin are as strong as ever. With newer innovations picking up, we'll see another extended lull period. The next wave will come as some of the other alternatives come up with working products and use cases. As usage grows, we can be sure that we'll see the marketplaces getting active again and the merchant revival come in in a big way.
Th institutional money will then come in as a supportive investment and not as a speculative one. That is where we have to head.

This present FUD too shall pass.

 
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February 05, 2018, 08:15:13 PM
 #4

I believe its has both good and bad effects. Good because such institutions would be putting up their investment in bitcoins which means they also knew that there is a big opportunity to earn from it. While on the other hand it would be risky too because there is a possibility of monopolizing the current market due to its high demand in the market.
This is really why we need bitcoin to be more of a usable currency than just a speculative asset as that would give them more chance to take hold of the market strongly and be able to control it however they wish and like. These are guys who have been living their lives manipulating the fiat system, what makes us think the same will not happen in this scenario with bitcoin. I am still sure what we are experiencing right now is institutional played, so the answer to the OP's question is glaring from what we are seeing in the market presently.

I wonder why this was not attended to since December. Even though your's was post busting, it is good this is brought up. I have asked myself this question several times and to me, I just end up seeing room for pretty much manipulation. Unfortunately, a lot of people are panicking and giving them the chance to be able to have more hold in the market, but I am not sure if this would really mean much in the long run on the amount they are going to be sitting on. I am sure they are having this moment already and we can see how that is leading us. At the end, I only see bitcoin ending up as a store of value with the look of things.
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February 05, 2018, 08:18:28 PM
 #5

We were much better without any institution, since the future contracts exist we are only falling!
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February 06, 2018, 01:51:49 AM
 #6

We were much better without any institution, since the future contracts exist we are only falling!
While the current decrease of the price coincides with the future contracts to me the drop in the price seems to be due to factors that can be attributed to bitcoin and nothing more, there is manipulation going on but the drop seems to be related to the fact that china is going to make their controls over cryptocurrencies even tighter which is bad news since we will get less money from Chinese investors.

 
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February 06, 2018, 02:28:18 AM
 #7

I believe its has both good and bad effects. Good because such institutions would be putting up their investment in bitcoins which means they also knew that there is a big opportunity to earn from it. While on the other hand it would be risky too because there is a possibility of monopolizing the current market due to its high demand in the market.
This is really why we need bitcoin to be more of a usable currency than just a speculative asset as that would give them more chance to take hold of the market strongly and be able to control it however they wish and like. These are guys who have been living their lives manipulating the fiat system, what makes us think the same will not happen in this scenario with bitcoin. I am still sure what we are experiencing right now is institutional played, so the answer to the OP's question is glaring from what we are seeing in the market presently.

I wonder why this was not attended to since December. Even though your's was post busting, it is good this is brought up. I have asked myself this question several times and to me, I just end up seeing room for pretty much manipulation. Unfortunately, a lot of people are panicking and giving them the chance to be able to have more hold in the market, but I am not sure if this would really mean much in the long run on the amount they are going to be sitting on. I am sure they are having this moment already and we can see how that is leading us. At the end, I only see bitcoin ending up as a store of value with the look of things.

To make Bitcoin more usable as currency there should be a decent solution for scalabity issues. Also, high volatility doesn't help, and as a decentralized currency, volatility is part of its nature, there isn't much to do about it... Bitcoin goes through the store of value path, with some people using it as currency, but not the mass, not the most part of investors and enthusiasts.

I agree with you, the market's movements smell like manipulation, trying to make little fishes drop their coins, so the whales can take all of it and save for themselves, reaching to OP's possibility, to dump large quantities of coins later, a kind of sabotage. So the institutions come with their own Crypto-Currency (centralized one), saying: "Well, as Bitcoin failed, now you can use this one, it's much better, there are a lot of advantages, join us!".

So I don't think institutions investing hard is positive for Crypto world, especially for Bitcoin, but there is nothing we can do about it, it's a free world.

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February 06, 2018, 03:10:21 AM
 #8

We were much better without any institution, since the future contracts exist we are only falling!
While the current decrease of the price coincides with the future contracts to me the drop in the price seems to be due to factors that can be attributed to bitcoin and nothing more, there is manipulation going on but the drop seems to be related to the fact that china is going to make their controls over cryptocurrencies even tighter which is bad news since we will get less money from Chinese investors.

It's nothing to do with China. China banned bitcoin and closed the exchanges a good six months ago.

What is happening started with profit taking, and then liquidation of stop-losses via bots.

 
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February 06, 2018, 03:35:04 AM
 #9

The debate is still on-going if large investments from institutional firms, would be good or bad for Bitcoin in the long run. Some are saying it will bring more volatility <price manipulation> and others are just happy that the price will probably go to the Moon.

There are also conspiracy theories doing the rounds that these institutions will use their financial powers to destroy Bitcoin. <Buying large quantities and also dumping large quantities>

Some are even saying that the small fish will be eaten by the big sharks. Let's consider the impact of this and how this will change the Bitcoin scene.

Will Bitcoin go 100% commodity & store of value or will it still be used as a currency?  


It brings volatility and price manipulations only with a low amount of this institutional investors. If we will have more whales then it will be way harder for a single one to influence on the whole price, Bitcoin is still not popular enough for it. Monopolies do not exist on the free market (on the average and long terms), that will be to expensive to buy a huge amount of BTC. Even if someone do it and then dump all BTC the market will  bring the price back and the whale will lose its influence.
P.S. Current market cap of Bank of Aberica is slightly over the current crypto market cap. They gona have to sacrifice themselve to kill crypto.
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February 07, 2018, 03:28:14 PM
 #10


I believe that although the participation of these large companies favors the trustworthiness of small and independent investors besides causing more pressure for governments to be approved, it also causes greater price speculation and these volatile increases become the worst enemy of any virtual currency.
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February 07, 2018, 03:41:46 PM
 #11


Institutional money is one of the causes of speculation that is evident, almost as much as the sale of Wall Street futures. And it is precisely because of this volatility that this has caused that the governments of the world have insisted on wanting to control everything.
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February 07, 2018, 05:20:51 PM
 #12

Institutional capital is the only way for the Crypto market to sustain its own inflated prices and absorb its irrational valuations.

excluding government, at this point there are no other sources of capital aside from institutional money capable of supporting such disproportional pricing behavior.

Crypto will eventually face two options: clean its act for institutional and professional money, or implode.
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February 07, 2018, 11:48:42 PM
Last edit: February 09, 2018, 09:46:21 AM by farhaan
 #13

The debate is still on-going if large investments from institutional firms, would be good or bad for Bitcoin in the long run. Some are saying it will bring more volatility <price manipulation> and others are just happy that the price will probably go to the Moon.

There are also conspiracy theories doing the rounds that these institutions will use their financial powers to destroy Bitcoin. <Buying large quantities and also dumping large quantities>

Some are even saying that the small fish will be eaten by the big sharks. Let's consider the impact of this and how this will change the Bitcoin scene.

Will Bitcoin go 100% commodity & store of value or will it still be used as a currency?  


I think that institutional capital is good for bitcoin as it would add more credibility to bitcoin.It is also said that if institutional capital enters bitcoin market,it would also reduce the volatility of bitcoin price as such firms would not be reacting like newbies getting panic and selling bitcoins thereby destabilizing the market.

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February 08, 2018, 12:15:46 AM
 #14

For me, large institutions are not totally bad to invest in bitcoin or any other coins, as long as they have enough capital to invest. In fact, that certain institution can contribute to the total development of bitcoin business because they invest, in bitcoin business if nothing people will access or invest it is totally useless, so why some people said that large institutions are bad in bitcoin business, and some also said that some large institutions manipulated the price, for me, how can large institutions manipulate the price, they are only a member and fan of accessing and investing bitcoin, and without direct power to control the price, investors are no power to control the price. The only person can control the price is only the management.
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February 08, 2018, 03:03:53 AM
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 #15

I recently read an article that Blockchain's first major use case is as the stock market 2.0 and with the way things are going it looks like Bitcoin and other cryptocurrencies are emerging into a new asset class, cryptoassets. Technology stocks always had a significant impact on the market, and being a new asset class, Bitcoin is still in its early phases, a few perceive it as a hedge against traditional markets, but for the rest, it's still a speculative asset, but as its value evolves as a commodity, it would have more impact on traditional markets.

If you look at things from commodity perspective, Bitcoin as being a mainstream financial investment, then institutional money is good, it's not just about futures, but recently Robinhood announced plans to enable Bitcoin trading, NASDAQ futures plan, similarly if some major firms allow Bitcoin trading, it would give Bitcoin much more credibility and legitimacy as an investment/commodity. I think institutional money might decrease volatility and give more stability and liquidity, but yeah, the downside is the possibility of manipulation along with somewhat a barrier for small investors to get into the market, and even though a disrupting technology, commodity adoption might have more speculation than technology/fundamentals. This is where IMO the currency aspect is necessary.
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February 08, 2018, 04:26:25 AM
 #16

Institutional Capital can bring goodness at the same time will ruin the people. It is good to see that the price is volatile and our investments gradually increase but if we look at the manipulation of others specially the whales, we will notice how it really bad and it will bring us bankruptcy if they will make a conspiracy to bring down the price of a certain altcoin.
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February 08, 2018, 04:34:22 AM
 #17

Institution capital brought us to good speculation of income in bitcoin.Investments increase and its because of their big contribution in the market to flactuates the value for rising up.Its good thing to know that they encourage bitcoin now worldwide.
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February 08, 2018, 06:17:41 AM
 #18

I recently read an article that Blockchain's first major use case is as the stock market 2.0 and with the way things are going it looks like Bitcoin and other cryptocurrencies are emerging into a new asset class, cryptoassets. Technology stocks always had a significant impact on the market, and being a new asset class, Bitcoin is still in its early phases, a few perceive it as a hedge against traditional markets, but for the rest, it's still a speculative asset, but as its value evolves as a commodity, it would have more impact on traditional markets.

If you look at things from commodity perspective, Bitcoin as being a mainstream financial investment, then institutional money is good, it's not just about futures, but recently Robinhood announced plans to enable Bitcoin trading, NASDAQ futures plan, similarly if some major firms allow Bitcoin trading, it would give Bitcoin much more credibility and legitimacy as an investment/commodity. I think institutional money might decrease volatility and give more stability and liquidity, but yeah, the downside is the possibility of manipulation along with somewhat a barrier for small investors to get into the market, and even though a disrupting technology, commodity adoption might have more speculation than technology/fundamentals. This is where IMO the currency aspect is necessary.

I like what you are saying. So it is not just about the manipulation, but more than that, it is about the credibility and legitimacy as an investment/commodity on global stock markets. In your opinion, what would be more beneficial to Bitcoin? Bitcoin Futures or Bitcoin ETF's?

Being such a small fish in the pond, would institutional money suffocate Bitcoin or would it strengthen it's growth. I see a situation where big Wall Street traders will only replace the old Bitcoin whales. <Everyone has their price and these guys have enough money to grow a big carrot for these Bitcoin whales.>


Harlot
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February 08, 2018, 06:38:07 AM
 #19

I think it will be more volatile as an increase in investor and investor's money will mean more price movement for Bitcoin. And isn't the whales doing that already? If the business investors will enter late into the scene it will mean that they will be buying up the price of Bitcoin. Some of the people have even said that they have already entered and they are the ones who have pushed the price down because of the bad statements they are doing. Well I don't have any proof of it but there is a possibility that they have done it.

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February 08, 2018, 07:07:41 AM
 #20

Currently, Bitcoin has not be fully utilize and a lot need to be done with bitcoin and blockchain technology. The most things that I think the blockchain's enthusiasts should do is to be able to convince governments and financials leaders about the benefits of this technology. From my country I discovered that bitcoin  is been attacked because the leaders did not know anything about bitcoin but see it as ponzi. I think institutionalized capital is going to affect the development of bitcoin.
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