Today bitcoin is bouncing back, trading near $54,000. Over the last week it fell from a high of near $60,000 to a low of about $51,000.
This is nothing to worry about for long-term holders in my view. Actually, it would be good for things to cool down for a while. Bitcoin has practically gone vertical over the last year, and that’s always a little worrying.
Honestly, I wouldn’t be disappointed if we hovered around these levels for the next 6 months or so. Bull markets need occasional breathers so they don’t overextend themselves.
Meanwhile, fundamental news is still good. We found out this Wednesday that Fidelity has applied to launch a bitcoin ETF. Here’s a snippet from Reuters’ reporting on the story.
Fidelity applied on Wednesday to launch an exchange traded fund to track the performance of bitcoin, the latest move on Wall Street to embrace the digital currency.
Fidelity’s Wise Origin Bitcoin Trust would hold bitcoin and value its shares based on prices from major cryptocurrency exchanges, including Coinbase and Bitstamp, according to a preliminary filing here to the Securities and Exchange Commission.
Having a trusted name like Fidelity launch a publicly-traded bitcoin ETF would be huge for the space. They would likely charge far lower fees than Grayscale Bitcoin Trust while also managing to track the price more accurately.
This would give many institutions the excuse they need to start getting into BTC and crypto. It would be hugely beneficial to have such a rock-solid institutional firm offering an accurate and reasonably-priced bitcoin ETF.
It’ll take time to play out I’m sure, as the SEC has been extremely slow moving on crypto ETFs. But with a power-player such as Fidelity pushing it, I do believe it will get done eventually.
Meanwhile nothing’s changed with the world’s financial situation. Debt continues to pile up as spending increases unabated. I’m fairly confident the Federal Reserve will need to launch new quantitative easing measures soon and to start buying up more of the country’s massive treasury issuance (who else is going to buy the trillions issued this year?).