5 REASONS WHY BITCOIN AND OTHER CRYPTOCURRENCIES ARE TAKING US ON A ROLLERCOASTER
Posted by: BITCOINSTEIN, January-6-2018
Little did anyone know that the prices were going to see a steep decline, taking us on a wild ride of cryptocurrency for 2018. As a fact, “cryptocurrency” is a word that elicits a very strong response these days transforming from something easily dismissed to something hard to ignore.
Little did anyone know that the prices were going to see a steep decline, taking us on a wild ride of cryptocurrency for 2018.
As a fact, “cryptocurrency” is a word that elicits a very strong response these days transforming from something easily dismissed to something hard to ignore.
A year ago, very few talked about investments in cryptocurrency and still a massive part of population haven’t heard about it. Many cryptocurrencies surged in value mostly because people are looking for an alternative, and more so than not, because they’re trying to make a quick boom.
5 Key factors are catching investors in 2018.
1. FOMO Among Bitcoin investors.
FOMO (Fear of missing out) a very common term among cryptocurrencies investors, describe the period when prices are volatile and investors panics from losses or winnings. Getting involved into the world of cryptocurrencies trading is still very much driven by sentiment and emotions rather than valuation, considering that market prices are currently so speculative, but don’t let the your heart cloud your judgement.
The volatility in the market often is what leads to either fear or faith. Fear in the Crytpocurrency field blows with the wind, essentially the facts speak for themselves, the price fluctuations, if Bitcoin’s volumes increases, certain crypto-assets might be affected, because they priced in Bitcoins.
Large growth in the educational sector. Cryptocurrencies becoming mainstream and not only “tech geeks” are involved. The entire eco-system is growing - the trend is clear.
2. Hacking and Regulation
Over the past few years, there’s been quite a few large high profile cryptocurrency hacks, Hundreds of millions of dollars have been stolen and lack of security created a trust barrier among some of the investors. Such events typically have fleeting market impact: bitcoin has surged to one record after another during the past few years despite major thefts from exchanges including Bitfinex and Mt. Gox. Here's a list of some of the largest cryptocurrency hacks so far:
- August 2010: Bitcoin Hack
- March 2014: Mt. Gox Hack
- January 2015: Bitstamp Hack
- June 2016: Decentralized Autonomous Organization Hack
- July 2016: Steemit Hack
- August 2016: Bitfinex Hack
- July 2017: CoinDash Hack
- July 2017: Parity Hack
- July 2017: Veritaseum Hack
- August 2017: Enigma Hack
- November 2017: Tether Hack
The general concern rise worries and questions that still left unanswered after the recent hacks into cryptocurrency exchanges and mining sites and the new regulations on taxing the earnings from trading in countries like the U.S and India might have scared off potential investors and even caused existing participants to cut their losses.
3. Limited Supply.
Most of the cryptocurrencies are not governed by banks or the governments, hence no one controls the price; it’s most about demand and supply. High demand, low supply open doors for opportunities - this is what we all looking for.
There are 21M Bitcoins ever created out of which 16M are in the market circulation The concept that a cryptocurrency exists in limited number, with new units brought into existence at regular intervals over time.
Bitcoin’s value comes from people willing to accept them as payment or investors who believe in the digital store of value.
4. Crypto Gaining Confidence In Emerging Economies.
Bitcoin won the title of the “Digital Cash” by offering us fast, secure and borderless transactions. Using its own decentralized technology for securing payments and storing funds, cryptocurrencies are independent of any banks or governments. The transfers can also be sent anywhere in the world instantly at virtually no cost, making them ideal for use in countries experiencing economic trouble, lack of trust in the banking system or where movement of wealth is not possible through the traditional policies.
Bitcoin and other alternatives are used by everyday people to circumvent the government’s strict capital controls for payments overseas, gaining the position of the fastest growing payment system in the world. The blockchainis the main reason why cryptocurrencies are here to stay.
5. Does Trends Matters?
According to Forbes, in the year of 2018 we will see many more cryptocurrencies doubling in value. This will be the year that more unknown cryptocurrencies double in value. How many will quadruple in value is anybody's guess.
In 2018, some of us are going to spend time discovering newer companies and our coins, especially since this market currently seem to run on greed. Investors will seeks for new windows of high-returns.
As a result of this trend, bitcoin's dominance of the cryptocurrency market has fallen to its lowest level in five years. As of now, bitcoin’s market cap is $233.6 billion, accounting for 36% of the total value of all cryptocurrencies. In January 2017, bitcoin accounted for 80% of all trading in crypto.
Please do not consider this post as any sort of financial advice - we believe in education and simply just spreading our thoughts among the network. The cryptocurrencies market contains risks therefore invest wisely.