Bitcoin has fallen for six-straight days, its longest losing streak since September, just as the Wall Street financial machine appears to be slowly gearing up to embrace the digital asset. A slew of other cryptoassets like litecoin, bitcoin cash, and ether also fell during the morning hours in London as the overall value of the crypto-universe declined, according to Coinmarketcap.com.
Bitcoin, the crypto with the highest market value, has fallen more than 30% from its end-of-day high on Dec. 16 to $12,753, a drop of about $6,590, according to Coindesk.
Goldman Sachs is setting up a trading desk for digital assets and plans to get it running by the end of June, if not earlier, according to Bloomberg, citing unidentified sources. Major exchanges in Chicago debuted bitcoin futures this month, giving larger traders who had been locked out of the market for regulatory reasons an easier way to get in involved.
Looking for reasons to explain bitcoin’s recent drop could be futile, if you believe Yale economics professor Robert Shiller, who says a “rational appraisal” of bitcoin’s value just isn’t possible right now. However we can take a look at a few the stories that are evolving in the background.
If Wall Street were to one day treat bitcoin as just another investable asset, that should be good for its value, as it would drive up demand from a new set of players. At the same time, the exchanges where actual bitcoin trading takes place have stumbled. Coinbase, one of the biggest US venues for trading digital assets, said this week it was investigating insider trading on its platform. A much smaller exchange in South Korea filed for bankruptcy after hackers stole from its reserves—a phenomena that is far from unusual.
Of course, bitcoin has been declared dead before and then gone on to rally beyond expectations. (Though it’s worth noting that soaring gains are a feature of a bubble, not a bug.) Whatever happens, it remains to be seen whether Wall Street is nimble enough to participate in this speculative frenzy—it takes time to cajole government watchdogs and clients into supporting a new financial initiative. By the time they get on board, the unpredictable and fast-moving world of digital assets may already have moved on to something new.