Luno CEO: BTC likely to keep climbing despite Bitfinex, Tether scandal

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If you’re expecting the Bitcoin Core (BTC) price to crash when the full details of the Bitfinex and Tether scandal come to light, then you might be waiting for the wrong thing. CoinGeek has learned that top analysts expect the news to have little effect on the market, and expect it to keep climbing.

We reached out to Luno CEO Marcus Swanepoel for his thoughts on the current state of the market, and specifically how it might be affected by the ongoing Bitfinex drama. “Typically, in the financial market, ‘if it’s in the news, it’s in the price’—and rumours about these issues with Tether have been circulating in the market for many years, so it should come as no surprise to most of the market and henceforth the price should not be materially impacted,” he wrote.

The expectation amongst institutional and expert investors, who would have the most money to move around, was that this was always going to happen. That doesn’t say much about the reputation of either Bitfinex or Tether, but it does provide some guidance on what will come next.

That doesn’t mean it will have zero impact. “It will create a lot of negative press that will impact new users signing up or scare some people that were perhaps not aware, albeit they are likely in the minority,” Swanepoel noted. All the same, he expects the market to keep climbing. “Given there is generally strong momentum in the market and price at the moment, this should also mask some if not all of the impact. We’ve seen in previous similar scenarios that the market might take a small hit but rends to recover quite fast given so many other (more) trusted sources of liquidity.”

He does think it may help reform regulations of the crypto world though. “Many are still finding their feet in the ‘stablecoin’ arena, so this is likely to highlight additional risks that regulators would be interested to clarify,” he noted. Although, he did stress that any impact from further investigation will have a minimal impact on markets.

His expectation is that due to U.S. and Chinese relations scaring traditional markets, we can expect to see BTC and crypto prices generally continue climbing. “Despite a significant high profile hack of a major exchange reported this morning, buyers are still coming in for BTC,” he pointed out. “It may be significant that Bitcoin, at the moment, seems to attract investors when we switch to a risk off main market.”

Of course, that may not be the whole story. As Chico Crypto has pointed out, shenanigans committed by crypto whales, including Bitfinex execs and Binance CEO Changpeng Zhao, may be inflating the price of BTC in an attempt to use Tether while it’s still useful. While money might be flooding into the market now, and much of it to BTC, as more news comes out, it’s always possible that better investments win out.