Bakkt Bitcoin Futures Launch FAIL? Is Bitcoin Breakout Imminent? Watch This

September 24, 2019
“With Bitcoin, no one has a monopoly of information”
― Tyler Winklevoss

5-Day Change

  • Bitcoin $9,649
  • Ethereum $195
  • S&P 500 $2,991
  • Dow Jones $26,950

Bakkt Has Launched – Everything Bitcoin Traders Need To Know

It’s not the explosive start that many expected... as Bakkt, the physically-settled Bitcoin futures launched Sunday to not exactly explosive fanfare. In fact, the reception has been downright underwhelming, with only 71 contracts traded in 24 hours for the monthly contract, and even less volume for the flagship daily contract.

Any bump in the spot price? Not yet at least, with Bitcoin’s price actually falling 2.52% since the contracts launched. And the contracts themselves are trading at sub $10,000.

So Bakkt’s a dud? It’s best not to go that far. This is an entirely new product, and is completely regulated – a first for Bitcoin financial products. It’s not surprising that it’ll take some time to gain momentum.

What’s there to look forward to? There’s no doubt that the price will go up – eventually. A fully regulated product, backed by a major player (the owner of the NYSE) means that interest will pick up as investors look for new instruments to buy into. Institutions, for whom the product is designed, don’t move as quickly as retail traders, but they have much bigger pockets.

Wut We Think: Bitcoin isn’t showing any indicators that say it’ll move any way but sideways for the next week, and bears are eyeing $7,700. But rest assured that if it does go that low, a feeding frenzy will emerge as institutions buy up supply to use in Bakkt’s contracts.


The Hash Rate is at a Record High, But a Flash Crash Just Dipped it 40%

Bitcoin is more secure than ever... but an unexplained flash crash just took the hash rate down 40% with no explanation in sight. But that’s only off a peak of 102 quintillion hashes per second – a historic record that indicates how confident miners are in the cryptocurrency.

Why does the hash rate matter? The hash rate, put simply, refers to quantity of computations done by the Bitcoin network. This means that the higher the hash, the more computing power allocated to Bitcoin, and the more secure it is.

So it can’t be hacked? The Bitcoin network can’t be hacked in the traditional sense – it’s decentralized, meaning that records are stored on every miner and node. It can be attacked, but only if the attacker controls more than 51% of the hash rate – but since computing power gets more expensive the bigger the hash rate, that means that any attack would be financially prohibitive.

So why is this dip important? Bitcoin’s still pretty secure with a weekly average hash rate of 94 trillion hashes per second, so there’s no attack incoming. But it does show that there are some variables in the has rate that aren’t accounted for.

Wut We Think: A growing hash rate is a bullish sign, since miners cost money and power, and the more hashes being done directly translate into increased power costs and equipment outlays. Miners must be confident that Bitcoin is sound and growing, otherwise the hash rate would decrease. So flash crash or not, Bitcoin is going to be around for a while, and more secure than ever.


Trading Spotlight: Futures Contracts

It’s always nice to brush up on your trading basics. In honor of the Bakkt launch, here’s a quick description of its foundational product – a futures contract:

Futures contracts are financial products that trade on what the price of a commodity will be in the future – this is commonly used in oil trading, for example, where the usual quoted price of a barrel of oil isn’t the spot price of buying a barrel of oil now, but a future. To read more, visit the Monfex Trading Academy.

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