Cryptocurrency market volatility is on the rise, as fund managers file SEC applications for Bitcoin (BTC-USD) ETFs. The list of companies involved includes companies such as Blackrock, Wisdom Tree, and Invesco. That news has been a boon to crypto prices overall, which have jolted upward rapidly over the past week.
The rapid progress we’ve seen toward wider acceptance of crypto signals potential for further market growth in the coming weeks. The net effect is that there will be a greater convergence between crypto and traditional finance. It’s going to catalyze greater opportunities moving forward.
The Bitcoin news has already pulled the majority of cryptos higher. Now it’s time to consider why particular cryptos should also see their own rallies on this news.
Hedera (HBAR)
Hedera’s (HBAR-USD) opportunity has arrived, as its enterprise use cases appear to have become attractive. Hedera is an enterprise-grade public network for DApp creation, providing unique utility applicable to businesses. I think you can see where I’m going with this. Bitcoin ETFs are in demand. Traditional finance and cryptocurrency continue to merge in terms of their real-world value provided to users.
That gives Hedera a real opportunity in the enterprise space. This crypto project has worked with major S&P 500 clients in the past, and it’s logical to assume that enterprise collaboration possibilities will increase over time.
However, those possibilities have dwindled, driven by quantitative tightening that roiled both the stock and crypto markets. That said, crypto is clearly roaring back, as investors price in better days ahead.
We’ll see if that’s the case. But it’s clear that Header’s value, as a crypto project that straddles the dual worlds of traditional finance and crypto, is one that’s in vogue. If trust in the traditional financial system wanes, Hedera can rise. Moreover, enterprises can embrace Hedera’s functionality and integrate it into their operations. Thus, no matter what happens, Hedera is a crypto project poised for success.
Bitcoin (BTC-USD)
Bitcoin is the well-established as the bellwether of the crypto market. As Bitcoin goes, so goes almost everything else. It was the first cryptocurrency to appear on the market, and remains the grandfather in many ways.
In regards to the recent news around Bitcoin ETFs, what’s important here is that these recent applications are pushing for real, meaningful innovation in crypto and Bitcoin. Current Bitcoin futures ETFs are already available for investors. Those allow for the buying and selling Bitcoin at agreed-upon future prices.
However, the more recent applications are for spot Bitcoin ETFs. This would mean that institutional investors would theoretically be able to buy and sell Bitcoin on the open market, without the use of derivatives. That could increase the demand for Bitcoin on exchanges, driving its value higher.
When one considers the impact of institutional capital flowing into alternative assets like Bitcoin, the potential here is massive. Indeed, it’s safer for many investors to just stick with the big dog on this news.
Polkadot (DOT-USD)
Polkadot (DOT-USD) is attempting to fundamentally change communication within the blockchain world. Currently, most cross-chain communication requires a simple transfer of tokens from one blockchain to another. That was an important iterative step in building Web3. Polkadot, though, goes a step further by facilitating the transfer of any type of data between blockchains.
That’s why projects like Polkadot get referred to as the internet of the blockchain. So, why and how does this matter in relation to Bitcoin’s recent surge upward?
The answer is that blockchain integration into mainstream finance necessitates such interoperability. Polkadot facilitates broader communication between disparate blockchains and frees up the flow of information between them. All that information will need to be connected to the traditional financial system. In this case, Polkadot is the potential link.
Additionally, Bitcoin ETFs are a strong signal that such development is continuing. Traditional and modern finance are converging, and Polkadot looks likely to be a bridge technology of some form. That’s reason enough to consider this crypto project right now.
On the date of publication, Alex Sirois did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
