I’m not much for speculation unless I’m writing sci-fi, so everything in this next bit should be read only after buying shares in a massive salt mine.
I think cryptocurrency is nearing the end of one cycle and is beginning a new one. The old paradigm was dictated by the early adopters, and mostly comprised of the geek/tech scene widely adopting and then over-speculating on crypto-assets after seeing potential value and also a means of churning through a thousand variations of get-rich-quick schemes
(via the ICO vehicle). Is the ICO dead? EHHH, maybe?
Or maybe not. One thing is for sure: ICO money is starting to dry up. And with exchange listing fees exploding
, the whole ICO market is looking more unsustainable at its current rate.
This is a good thing.
Some return to normalcy is happening, and ironically, this looks a lot like a massive bear market, with Bitcoin leading the decline. But it’s only a bear market in context with the prior massive bull run that mostly catapulted cryptocurrency into the national and international consciousness late 2017.
Despite the 2018 downturn, we’re nowhere near the bottom–and from a total value perspective, the entire crypto market is still highly valued compared to where it was at the same time last year. Hell, Bitcoin is up 1000x from last March.
This is the beginning of a renewed interest in making cryptocurrency promises happen–or bust. It’s also the beginning of a more gradual, yet still significant mass awareness and adoption of cryptocurrency. This will become more apparent as new products are released that make the buying, selling, trading, and use of cryptocurrencies easier than ever (as we know, use case is small enough, and there’s a huge technical hurdle for most users to overcome. As crypto matures, it will become easier for normal users to utilize.
The 2nd quarter will bring a lot of sideways action as the market juggles impending regulation and general uncertainty while institutional investors stockpile and individuals decide if they have the stones to stay in or sell out. Meanwhile, the projects that everyone bet big on will continue to develop their roadmaps and build products that will start to hit this summer. We’ll start to see whether these products can follow through on the promises of the white papers. Many won’t, and will die a slow death. A few will, and their rise will be spectacular (and make early investors fabulously wealthy in the process).
By 3rd quarter I think we’re going to all have a much wider foundation of knowledge and experience within the cryptospace. As individuals, we’ll be more savvy about which projects “feel” like a bunch of hot air and which ones are the real deal. We’ll all become smarter investors, or at the very least, more cautious.
At the moment, altcoin price speculation is largely tied to Bitcoin’s fortunes. This is partly because few exchanges have USD-crypto pairings beyond Bitcoin. But that may be about to change.
If more exchanges offer more altcoin-fiat pairings, we’ll start to see a significant shift in altcoin valuations across the board. This would likely open up more investing opportunities for individual and institutional traders who are desperate to put money into alternative markets when Bitcoin looks shaky. Right now, that’s a difficult and expensive proposition, but if friction were reduced, imagine the “grass-is-greener” mentality would take hold quickly.
Meanwhile, institutional investors will realize that crypto is still largely untapped, and the opportunity for a trillion dollar market not only exists–but is inevitable. Once the regulatory bodies get a handle on just what the heck crypto is, the environment will become less risky, and by extension, more attractive. By the beginning of Q4, we’re going to see extraordinary movements in both prices of alts and in product releases.
As for Bitcoin, I suspect we won’t be seeing its rise to $50,000 or a million per coin, as some have predicted. I don’t think we’ll see it die, but I believe Bitcoin’s time is coming to an end. Its purpose was to become an alternate path for money to follow, and a chance to decouple from the existing financial frameworks. It both succeeded and failed in those goals, but its main success is in opening the door to blockchain development and innovation. That genie is out and will never be put back, no matter what the future holds for Bitcoin.
Of course, I could be wrong about all this. But that uncertainty is partly why this is such an interesting and amazing time–we’re seeing the potential for a third technical revolution (the first two being the development of the Internet and the introduction of the smartphone to our daily lives). If it is indeed as revolutionary as I believe, 2018 is only the beginning of the maturation phase of crypto.