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By Allex Ferreira, Baron of Bitcoin
Few people know how important and important the over-the-counter (OTC) product market is, especially in Asia. Octagon Strategy Limited (OSL), based in Hong Kong, is one of the largest companies that buys and sells large amounts of digital badets on the Asian continent.
Since the beginning of November, I have been communicating by e-mail with the vice-president. and I would like to share with my readers some of his views and opinions on the market in general and on the latest Bitcoin price movements.
Who knows who follows the market as often as the price of bitcoin has been lateralized for more than two months, especially between 6 September and 13 November, negotiated between 6200 and 6500 dollars.
Many people wondered why. volatility as low during this period. According to Fernando Martinez, the proliferation of sophisticated financial instruments increasing the liquidity of the market and, hence, reducing volatility, is one of the factors explaining this lull in volatility and perhaps others that will follow.
"Several companies and platforms now offer crypto-active derivatives such as futures, forward contracts, options and swaps, as well as the ability to borrow and borrow In the past, this was very limited and as the industry matured and institutional investors entered the market, the need for these types of products increased. was beginning to intensify, companies were starting to leverage larger products to provide the most sophisticated audience, "wrote the vice president of OSL.
Martinez does not believe that the story created in (see more about these financial products in a special article that we publish here) could be a catalyst for rising Bitcoin prices in the short term, even if it is approved later this year. "This story is very old.I think the impact on the price of an ETF is already reflected in this price range that we have now.It is clear that if an ETF is approved, it will bring more capital to the market and will create a positive trend in the long run.However, the price and volatility that it could bring back could come back to what they were in 2017 when Winklevoss submitted its application for the first time. "
With respect to the size of the OTC market worldwide, this ensures that bilateral negotiations have more volume than those recorded in the major exchanges of the planet. "The volume of the meter has always been significantly higher than in trade.The reality is that regulated stock exchanges with legitimate banking relationships do not have sufficient liquidity and the ill-regulated stock markets have liquidity but lack banking relationships. Is a problem for the institutional investor because you have to offer both regulation / compliance and liquidity. In the OTC market, it is easier to identify the counterparty and propose a rigorous method KYC and LBC practices, and the OTC market is open to interested parties seeking access to larger pools of cash and offers international banking relationships with 24-hour settlement. for counterparties subject to a rigorous audit process, as is the case with OSL, "Fernando said. I repeat here the fact that he has sometimes known the speed of OSL trading desk operations that he has performed in recent months.
According to him, the Asian market currently has more crypto sellers than buyers. "In Latin America, the opposite is true, there are more buyers because of arbitrage opportunities, and in Latin America the market has started to take off in volume and has become an important area to watch."
Last Monday, November 27, I received another email from Fernando with a very thorough badysis. about the sharp drop in the price of Bitcoin since mid-November. I fully share with you the badysis of the vice president of OSL, the largest trading desk of Bitcoin in Asia:
"At the end of October, our total market capitalization was $ 210 billion At the moment, $ 113 billion, or nearly $ 100 billion, has been taken off the market, and some people say that the catalyst for this accident was hardfaction, which culminated with the ABC and SV, and also because of the hash warfare between these two networks, but the reality is that this sale is due to multiple factors that have had such an impact and have even brought the return of volatility to the market.
It was the perfect storm, on the one hand, you have protocol tokens, which are fantastic technologies and have great aspirations to revolutionize the world, but do not have a daily use mas Most of the tokens are still used in the same way as the infrastructure tokens. There, the SEC is asking some country offices to return the funds, while continuing to view the projects as titles. In addition, we have all these millions of dollars that have been collected and that could be given to investors. However, we can only badume that not all projects have been prepared by a treasury department. So, if they can not repay, they will be trapped in bankruptcy. This led to the liquidation of the main protocols authorizing smart contracts in 2018, the most famous being the. At present, we do not see any support for the ETH, when it reached $ 100 / ETH, it could reach $ 80 / ETH.
Regarding the infrastructure chips, we find that they were very shaken with the fork of the BCH. , and many miners have completely turned their attention to this event. Just like the hashish war that took place between the SV and ABC, it had a negative effect on the ecosystem and private investors and modest investors, who were not very confident about the results at short term, began selling their badets. As the bitchoin continues to fall, the miners had to close their mining platforms. [Nota do Barão: inclusive eu desliguei recentemente mais de 1500 máquinas de mineração de Bitcoin que estava na China]
There seems to be support at the $ 3,500 level for Bitcoin, but I think it's still being tested, "concluded Fernando Martinez, vice president of the company. OSL.
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