Bill Barhydt, ABRA CEO, joins 'Power Lunch' to discuss Bitcoin's latest rally, understanding the cryptocurrency's liquidity and why he believes Bitcoin will continue to climb.
Bitcoin jumped to a nearly five-month high above $55,000 on Wednesday, extending its rally from the previous day as institutions jumped in to try to catch the wave.
The cryptocurrency traded 7.6% higher at $54,873.02, according to Coin Metrics. Ether also rose 2.8% to $3,575.73.
Bitcoin rose as high as $55,499 earlier in the session. It’s up 13% this week alone and 87% for the year.
The rally comes amid a series of small developments in Washington, D.C. that have provided some comfort to institutional investors keen to jump into cryptocurrencies.
“Regulatory uncertainty is what’s still keeping investors out of the market and every time we get a step closer to regulatory clarity, you see this kind of reaction,” Bitwise Asset Management chief investment officer Matt Hougan said. “It’s the primary driver of next great bull market in crypto.”
According to financial advisors surveyed by Bitwise, the number one thing preventing them from making allocations to crypto is regulatory uncertainty. Hougan said the majority result has been the same three years in a row.
On Tuesday, Securities and Exchange Commission Chairman Gary Gensler said in a hearing of the House Financial Services Committee that he has no plans to ban cryptocurrency, and that a ban would be up to Congress.
Gensler’s comments mirror those made by Federal Reserve Chairman Jerome Powell, who also said Friday he has no plans to ban cryptocurrencies.
“You had every major regulatory agency in the U.S. this summer declaring that they needed to create a new regulatory regime around crypto,” Hougan added. “That created a great deal of uncertainty in investors minds, they were hesitant to allocate not knowing what the range of possibilities would be. The reason we’re rallying this week is that most extreme left tail of following the path of China was wiped from the market by both Jerome Powell and Gary Gensler.”
