Bitcoin has taken a turn for the worse, but while the move may not look great on paper, it turns out things are going quite well for some of the institutional traders that have yet to step into the cryptocurrency arena. Many institutions are using the recent bitcoin price dip as an opportunity to buy at a lesser price and get their fingers on an asset that many companies have been going crazy over for the past six months.
Bitcoin Has Taken an Ugly Stumble
Things really took a serious turn back in August of last year, when companies such as MicroStrategy first began buying up tons of BTC and commenting about what an important asset it was for all who engaged in crypto trading. From there, many other institutions – such as Square, MassMutual and Stone Ridge – began making their way into the crypto space, and bitcoin’s price started to grow at an alarming rate.
However, nobody could have predicted the latest institutional move set forth by Tesla, which two weeks ago purchased approximately $1.5 billion worth of the world’s biggest cryptocurrency asset. However, this was all done at a time when bitcoin was trading in the $50,000 range. Now, it has fallen by about $10,000, which some believe to be a healthy correction, but either way, many institutions that haven’t gotten involved in crypto yet see this as a chance to finally try it out.
Aside from bitcoin, other altcoins appear to be feeling the heat as well. Assets such as Ethereum, Ripple’s XRP and Stellar are all suffering at the time of writing, though a select few – such as Cardano – are experiencing slight gains of around five percent at press time.
Many people seem to believe things will ultimately pick up once Coinbase fully goes public. The popular crypto exchange has just filed paperwork to be listed on the Nasdaq, and many analysts and industry experts alike think this is going to set things up for major change in the crypto space.
In a statement, the company explained:
Our mission is to create an open financial system for the world. We are building the crypto economy; a more fair, accessible, efficient and transparent financial system for the internet age that leverages crypto assets. These are digital assets built using blockchain technology.
We Need to Be Ready for Price Fluctuations
In addition, the company warned that volatility isn’t likely to disappear anytime soon, and traders – along with crypto-based companies like itself – need to be prepared for that. Coinbase explained:
Our operating results have and will significantly fluctuate due to the highly volatile nature of crypto. Most of our net revenue is derived from transactions in bitcoin and Ethereum. If demand for these crypto assets declines and is not replaced by new crypto asset demand, our business, operating results and financial condition could be adversely affected.