The year 2018 has been a pretty dismissal for the cryptocurrencies. The market cap of cryptocurrencies is falling consistently. In the month of May itself, cryptocurrencies have fallen significantly. That is why traders are trying to find out what is in store for cryptocurrencies in the rest of the year.
We look into some of the predictions of cryptocurrencies for the year 2018.
Market cap to head lower:
The current market cap of cryptocurrencies is around $ 310 billion. At the start of the year, it was somewhere around $ 500 billion. This is a clear indication that the cryptocurrency market is consistently falling as well. According to analysts, it is said to fall further. Even though some of the cryptocurrencies might rise higher but the overall market cap will fall.
Bitcoin to fall further:
There are many bullish predictions for Bitcoin. That, however, does not mean that it will increase significantly in the rest of the year. According to some estimates, Bitcoin will settle around $ 6000 by the end of this year. If this happens, it would have lost 66% of its value from the peak.
Bitcoin to be surpassed:
Many experts are pointing out that Bitcoin will be surpassed by any other cryptocurrency. The best prediction is of Ethereum. The usage of Ethereum is also increasing significantly. However, up until now, that one has been falling as well.
Also, according to the experts, the regulations will be increased significantly as well. As a result, US will be at the forefront of increased cryptocurrency regulations. This will also ensure that investors clearly know what they have to do in terms of taxation as well as investments in Bitcoin.
According to the experts, Bitcoin ETF will become more popular as well. Currently, there are a couple of ETFs listed in the United States. As a result, with passing time it will become more and more popular as well.
Thus, these are some of the predictions are related to cryptocurrency field in the year 2018. Most of these predictions are set to be achieved as well. That is why it remains to be seen whether each and every one of those predictions is achieved or whether only a few of them are achieved. Many traders as well as investors are looking at such predictions in order to get idea about the profits which they can generate from the cryptocurrency markets. Keyword: Bitcoin, Bitcoin ETF, Ethereum, cryptocurrency market cap, cryptocurrency prediction
- A merger occurs in the crypto space
According to CoinMarketCap.com, there are approximately 1,600 investable cryptocurrencies. Of these roughly 1,600 digital currencies, just 500 or so have a market cap north of $10 million, and a mere 91 had tallied in excess of $10 million worth of trading volume over the trailing 24-hour period. In other words, there are way too many cryptocurrencies clogging up the investable space, many of which aren’t very liquid. One way to fix this issue, short of removing certain digital currencies from exchanges, is through cryptocurrency mergers.
However, combining cryptocurrencies isn’t as easy as it sounds. Even though we’re essentially talking about making computer code compatible between two virtual tokens and their blockchains, the proprietary tweaks that crypto developers include on their networks and/or tokens makes a combination less than ideal more times than not.
Nonetheless, if smaller virtual currencies want to become relevant, or if mid-tier digital tokens want to surpass bitcoin, the idea of a merger or combination has to be on the table. For instance, in January, rumors swirled that bitcoin rival Litecoin and privacy coin Monero were in the early stages of considering a merger. Though this merger didn’t come to fruition, it marks the reality that consolidation is sorely needed in the crypto space. By year’s end, I predict we’ll witness the first notable merger.
- A major country bans cryptocurrencies
Finally, I’m going out on a limb and predicting that a major country will join the half-dozen smaller countries to have banned cryptocurrencies. Currently, cryptocurrencies are illegal in Bolivia, Bangladesh, Ecuador, Kyrgyzstan, Morocco, and Nepal. There are also quite a few countries where crypto is frowned upon, but not wholly illegal, such as Venezuela and China.
What country might be the culprit? That may be asking a bit too much of my crystal ball, but my eyes are squarely on Britain. The writing appears to be on the wall after British banks banned bitcoin purchases with credit cards back in February, and, just weeks later, the Treasury Committee of the U.K. Parliament announced a probe into how cryptocurrencies are impacting U.K. consumers, investors, and businesses. This probe was launched as a result of the hype and volatility that has shrouded the crypto space. Should a major market like Britain ban cryptocurrencies, it would be a major blow to the confidence of emotional retail investors.
Predictions aside, keep this in mind
Regardless of whether these predictions turn out to be partially right, spot on, or out in left field, what can’t be denied are the risks involved with cryptocurrency investing.
For starters, cryptocurrencies lack the traditional fundamental metrics that aid investors in determining an appropriate valuation for an asset. With a publicly traded stock, we can look at balance sheets, income statements, earnings reports, and listen to the commentary of management when determining whether a stock is worth buying or not. Cryptocurrencies have virtually no metrics that can be examined, save for processing speed and daily average transactions, neither of which tells us much about the long-term value of digital currencies.
Just as worrisome is the fact that blockchain technology is stuck in a vicious Catch-22. The digital, distributed, and decentralized ledger that underlies most cryptocurrencies has worked splendidly when kept within the confines of small-scale projects. However, no businesses have been willing to take the training wheels completely off of blockchain yet, primarily because it’s untested in the real-world — and gaining this real-world experience is only possible if big businesses give this technology a chance.
In sum, while cryptocurrencies are still liable to bring a lot of excitement to the table for the remainder of 2018, I’d suggest keeping your money safely on the sidelines and out of virtual tokens.