Bitcoin trades sideway after holiday amid hopes for softer regulatory environment and broader adoption

Bitcoin continues to trade quietly near the $95,000 level following the Thanksgiving holiday, which resulted in relatively low liquidity in the US market.

Optimism remains strong about the future of the US regulatory environment, with former Commodity Futures Trading Commission (CFTC) Chairman Chris Giancarlo predicting that the Securities and Exchange Commission (SEC) will drop its lawsuit against XRP developer Ripple Lab.

This comes after SEC Chairman Gary Gensler announced that he will step down when Joe Biden’s presidency ends in January. There is also talk of crypto advocate Paul Atkins being a potential nominate to head SEC. All of this adds to optimism about a more stable regulatory environment, following a series of lawsuits filed by SEC against several companies operating in the sector, including some of the largest.

While the turbulent environment has also hampered the wider adoption of cryptocurrencies and their integration into the financial system – which it was meant to revolutionize in the first place. With the upcoming structural regulatory shift, there is growing hope that crypto technology can become more deeply embedded in the wider economic life.

One of the most prominent aspects of the expected adoption is the wider integration of RippleNet’s cross-border payment settlement solutions among banks seeking to replace the traditional SWIFT system. Another aspect that has already been achieved is on the institutional investor side with the launch of spot exchange-traded funds in the US for both Bitcoin and Ethereum, which have net assets of more than $100 billion, according to SoSo Value.

What the markets may be counting on is further wider adoption as a means of settlement for comprehensive payments as well. The figures on this side are still weak despite the wide range of options and ongoing development.

For example, the top 20 decentralized finance (DeFi) protocols for payments in DeFiLlama’s statistics have only made about $291,000 in fees over the past 30 days. The total value of user funds (or total value locked (TVL)) in these protocols is only about $780 million, with Bitcoin’s Lightning Network taking in more than $500 million of that.

Another example is crypto payment settlement pioneer BitPay, which processed just around 247K transactions over the past six months.

In contrast, credit card companies in the US have earned more than $135 billion in fees in 2023, and Visa has processed about 266 billion purchase transactions in the same period, according to Statista.

In any case, optimism is prevailing and gaining more momentum with the upcoming relaxation of regulatory restrictions that will boost the broader Bitcoin, as the technology and infrastructure are already in place to serve the purpose for which these cryptocurrencies came.