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Bitcoin Price May Decrease Substantially with Institutional Adoption
November 14  |  3 min read

Institutional Investment May Crash Bitcoin Price, According to Expert

The COIN360 Editorial Team

Dr. Pavel Kravchenko, CEO and co-founder of Distributed Lab, revealed at a conference today that alongside the increasing institutional interest in bitcoin could come a bearish attitude towards the first cryptocurrency.

According to Kravchenko, “bitcoin is censorship resistant money” and if institutional adoption increases, bitcoin will no longer have that quality. At a panel focused on blockchain projects and native cryptocurrency tokens at the Cointelegraph BlockShow conference today, Kravchenko stated he doesn’t believe in institutional adoption, claiming that if it were to happen, bitcoin would no longer be censorship-resistant, therefore would crash to zero.

Additionally, Kravchenko stated that, while institutional acceptance might hurt the price of bitcoin, government pushback would help to increase it.

During today’s BlockShow panel, CEO of enterprise blockchain startup Bloq Matthew Rosak stated that “bitcoin as a store-of-value” was helping to increase the appeal of the entire industry. At the beginning of October digital assets analytical agency the TIE shared research findings showing that institutional interest in bitcoin climbed after Bakkt announced its launch at the end of August 2018.

Whether institutional investment will help or hurt the price of bitcoin is still unknown. According to research published less than two months ago, bitcoin futures settlement dates allegedly influence the price of bitcoin negatively. Per the research’s findings, from January 2018 to August 2019, 75% of the time before CME Group’s bitcoin futures settlement dates expired, the price of bitcoin decreased.

In other developments, the Bakkt exchange announced this Monday it was opening the Bakkt Warehouse to offer bitcoin custody to institutions all around the world, after receiving authorization from the New York Department of Financial Services (NYDFS). The Intercontinental Exchange’s (ICE) cryptocurrency venture is also planning to offer cash-settled BTC futures contracts by the end of the year, pending approval.

Additionally, plans of launching bitcoin futures options have emerged throughout the year. The Chicago Mercantile Exchange (CME) announced it would add bitcoin options to their bitcoin futures contracts launched around two years ago on Jan. 13 of next year, with Bakkt planning to launch options as well during Q1 2020.