Historically, over the last nine years, Bitcoin (BTC) has undergone four big corrections, which made it decline by over 80% in price. The corrections the crypto market saw in 2018 triggered a 69% decline in value of BTC. However, some minor digital currencies like Binance Coin (BNB) and EOS experienced negligible changes.
In August 2010, August 2011, January 2014, and January 2018, BTC experienced 70 – 80% losses against the US dollar.
The Maturity of the Crypto Market
Regardless of the noticeable waning in the value of BTC, many investors retained their investments, eliminating changes in their positions even in a period of doubt and extreme volatility.
The maturity of the crypto market has been manifested in the stability of Bitcoin since August 6. In the last two months, BTC has stabilized at the range of $6300 to $6800, seldom breaking out of the $6800 resistance zone, while other digital currencies like Ripple (XRP) and Ethereum (ETH) established high volatility.
The rise in the stability of BTC has enabled the crypto market to be less vulnerable to hype and regulation news. Significant achievements in the crypto world like the creation of Bakkt by Microsoft, Starbucks, and ICE to enhance the availability and liquidity of BTC- hardly influenced the short-term price trend of BTC.
On CNBC’s “Crypto Trader,” Erik Voorhees the CEO of Shapeshift Exchange said that the current bear market of digital currencies is progressively ending.
Voorhees further stated that, though the bear market is not totally over- considering the 80% decline in value of the cryptocurrency market- the market appears to have improved from the worst phase of the correction.
The Entry of Institutional Investors
In 2017, news about the likely entry of institutional investors was very common. To a large extent, the exponential rise in crypto prices in December last year was clearly activated by a new wave of interest shown by retail traders and individual investors all over the world.
In countries like South Korea and Japan, the interest and demand towards digital currencies rose to a point at which crypto exchanges lacked provisions of cryptocurrencies to meet the market demand, leading to the evolution of premiums.
Since BitGo and Coinbase are already permitted as trusted BTC exchanges in the US market and giant financial institutions Citigroup, Goldman Sachs and Morgan Stanley are ready to provide crypto services, Novogratz suggests that soon, institutions will flood the crypto market.
Novogratz further stated that institutions are only waiting for BTC to break out of its two major resistance lines, at $8,800 and $10,000, to start allocating their capital into the crypto world.
If this comes to pass, Novogratz projects a 30% increase in BTC price before the year ends.
Balaji Srinivasan, a Coinbase Chief Technology Officer, recently said that he fully trusted BTC and crypto market after it subsisted the 2011 crash. The resilience of the cryptocurrency market and its ability to rise again from huge corrections depicted the market’s potential for enthusiasts and investors.
The 2018 correction has left a similar effect on the crypto market. Though many investors were adversely affected by the 69% decline in the value of BTC, the market has experienced some of the most positive reports in all its account.
Here are some different 2019 BTC predictions:
Mitch Blakeway, Head of Trading at Quantatex
“We expect a high degree of volatility in the very near future.
“A high level of Bitcoins has recently been moved from cold storage to hot storage by significant influencers in the cryptocurrency market. What this means is that investors who have the ability to move the market are gearing up to trade. This could mean moves greater than 10% in either direction.
“There are notable levels of support and resistance with support around the $2,850 level for Bitcoin and resistance around $4,000 therefore a break either below $2,850 or above $4,000 could lead to momentum in that direction.
“We believe that Bitcoin will eventually shrug off the recent weakness during 2019 and expect the price to retest record highs of $20,000 by December 2019. This is justified on a number of fronts.
“We expect an ETF in Bitcoin to be authorised by the SEC in 2019. We expect continued adoption of certain cryptocurrencies such as Ripple (XRP) by banking institutions during 2019, which will have the knock on effect of positivity for Bitcoin as other cryptocurrencies tend to be ‘pegged’ to Bitcoin.
“We also believe that once the selloff has finished there will be modest headroom above the current price which will allow for buying momentum.
“During the dotcom boom the price of Apple shares went from $1 to $4 before ‘collapsing’ to $1 again. It now trades at around $176 per share at time of writing, therefore anyone fearing the worst after the dotcom boom would have missed out whereas anyone with a bit of courage and forward thinking would have seen significant returns.”
George Ermakov, Head of Research & Development at Crypterium
“Previous Cryptreium research identified a Bitcoin support area in the range between $3,000 to $5,000. At the moment, Bitcoin is actively trading in this range.
“Based on the existence of important fundamental factors such as the launch of BAKKT ICE and NASDAQ futures, 2019 is expected to be positive for price dynamics.
“Technical analysis based on logarithmic scale shows the expected price levels that bitcoin can reach in 2019. Bitcoin is likely to reach a price of around $12,000, which will be an excellent result and can initiate a further growth in 2020. 2020 is close to another important date – the BTC ‘halving’.”