September Crypto Outlook: Focus to Remain on SEC and Crypto Regulation...

August was a mixed month for cryptocurrencies. Bitcoin rose by more than 10% while other cryptocurrencies like Ethereum, Ripple, and Litecoin had double digit losses. Ethereum and Ripple declined by 30% and 20% respectively. YTD, Bitcoin, Ethereum, Ripple and Litecoin have declined by 40%, 60%, 68%, and 83% respectively. The total market cap of all cryptocurrencies started the month at $260 billion.
Last month, the biggest news in the cryptocurrency sector was the decision by the SEC to reject nine Exchange Traded Funds’ (ETF) proposals. This was a highly anticipated news by market participants because it would mean more demand by institutional investors. The SEC rejected the proposals, saying that they exposed investors to a lot of risk. The senior management of the SEC later announced that they would review the decision, which was made by junior staff members.

This month, traders will wait for the senior management’s decision after reviewing the ETFs. If one or more ETFs will be accepted, it could mean a short-term price hike of the cryptocurrencies. However, in the long-term, the decision could mean nothing for the currencies. Good evidence of this is the decision by the CBOE and CME to list Bitcoin futures in December last year. Traders anticipated that this would attract more demand by institutional traders. Instead, most of them placed short bets, which is a major reason why their prices collapsed this year.

Apart from the Bitcoin ETFs, traders will focus on Ethereum. The Ethereum network was created to provide application developers with a safe and reliable platform to build applications. To access the platform, the developers are required to pay using ETH Gas. This has led to the criticism that ETH could become valueless because the developers can continue to use the network without paying. These concerns have been shared by the founder of Ethereum Foundation, Vitalik Buterin. It is also the reason why the price of ETH has remained within a narrow range near the YTD low. Last week, the announcement by CBOE that it would list ETH futures provided no catalyst for the currency.

Traders will also focus on cryptocurrency fraud. In recent weeks, several criminal activities have been reported. Bloomberg reported that Robert Mueller was investigating a former Bitcoin executive who was accused of transferring fraud money using Bitcoin. If he is indicted, it could call for more regulations to prevent money laundering. Another fraud that will be watched is the Bitcoin Dark, a fraudulent cryptocurrency that has seen its price soar by more than 270% in what is being viewed as a pump and dump scheme.

Events play an important role in the cryptocurrencies sector. It is during these events that experts talk about the future of the currencies. Of course, some of the words from these experts are taken with a pinch of salt because they tend to have conflicts of interest. Some other participants are usually well-placed government sources who have a role in regulating the industry. This month, several high-profile events will take place.

On September 6, the Blockchain Conference for Software Engineers will take place in Atlanta. The goal of this event will be to share insights on ways to build quality decentralized apps and infrastructure. On 20th, the Asset Backed Crypto Summit will take place in Lisbon, Portugal. This event will showcase startups that have their crypto projects backed by common asses like gold, silver, and lithium.

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Information provided via press release