Just after the global economic recession of 2008, bitcoin erupted out on the financial scene. Although the asset could not get much attention in it’s first few years, the past couple of years have proved to be quite exciting for the asset. The 2017 bull run of bitcoin is unknown to none as the asset almost touched the $20,000 mark in December. Bitcoin trading has gained serious traction since then. But alongside this, bitcoin trading has become one of the tougher options for the investors entering this arena owing to bear run that has continued on for more than a year now. Besides, the institutions and major giants from Wall Street also hold back from entering the arena of bitcoin trading. Here are some of the reasons why the situation is as we see it today.
The connotation attached with bitcoin since the beginning has not been largely positive in the media. Since the market is new and technological innovation in blockchain is being made at a very rapid pace, there aren’t many laws and regulations surrounding the asset. Due to this, a lot of negative, illegal and fraudulent activities have found their ways to enter this world. Owing to this, bitcoin trading has not been one of the favorite options of the investor community and Wall Street in general.
A plethora of scams is seen in the bitcoin world. Many investors from across the globe have lost a large amount of money to these scams. Besides, the price of bitcoin is highly volatile. One day the asset is going up with massive greens and the very next day, it is down on its knees resulting in the loss of a large amount of money for the investors. Making things worse, the price is highly prone to manipulation by big whales present in the game and hence bitcoin trading becomes too unnatural of an option for the investors.
The regulatory body in charge of approving of bitcoin exchange-traded fund (ETF), the United States Exchange Commission (SEC), has also not approved it owing to the issues like manipulation and prevalence of fraudulent activities. Putting all the pieces of the puzzle together, it is the evolutionary issues linked with bitcoin that hold institutions and giants from Wall Street from touching this asset.
But as we move into 2019, developments are being made in the regulatory arena. Different regulatory frameworks are being put in place so that investors in the bitcoin trading community can be provided with secure frameworks of operations.
It is too early in the bitcoin world as of now. Just like every technological innovation, it seems that bitcoin also needs its time to grow and mature. Things will likely change as we move forward. Although bitcoin trading might not be the most favorite option of the institutions as of now, it might become so in the future.