The current volatility in the crypto space could be worrying for most new entrants. However, for seasoned traders and investors it’s an opportunity to learn the intrigues of the market. It is an opportunity to invest in stable coins whose values can withstand prolonged storms. From history, many altcoins are bound to fail and it’s difficult to tell which ones will survive in the end. In December 2017, Bitcoin price soared to an all-time high of close to $20,000 only to take a sharp downward trend that has reduced the pioneer coin to slightly above $3000 as of this writing. The trend has changed drastically since January 2018, with short-lived rallies followed by sharp sell-offs. Most major altcoins including Ethereum, EOS, Bitcoin Cash, and others have fallen sharply from their previoushighs.
The ailing marketThe stock market is ailing. Just recently, the market lost about $1 trillion following the decline in the market cap of both Amazon and Apple, which own a sizeable share of the market. In 2017, the market lost a huge chunk of its value from crypto and blockchain-related fintech. In addition, the entire crypto market is battling a number of issues. Cryptocurrency, unlike fiat money, is generated through a network of miners who maintain a transparent record of ownership. With the ailing market, a few problems surface up. For example, with the current situation in the market, the cost of mining Bitcoinmight be higher than the current value, which can render it unsustainable ifthe situation persists. Besides, there is increased pressure from the U.S.Securities and Exchange Commission (SEC) to regulate cryptocurrencies.
What is the next move?The crypto sector is young, vibrant, and evolving at a very fast rate. What we see today might not be the same tomorrow. Just as other revolutions that have taken place in the tech sector such as the internet, social networking, and others, the crypto space is going experience massive changes in the years to come. The best advice fora crypto enthusiast is to identify and invest in reliable assets that can weather the storm of revolution. Some of the assets we know today might be phased out in the near future. However, assets with clearly defined objectives, which are focused on accomplishing their goals, could just emerge stronger. Recently, Bitcoin enthusiast Mike Novogratz said, “Revolutions don’t happen overnight. While I believe in the underlying technology and believe in the crypto movement, when prices get stupid, I sell.” Even as the world leans toward mass adoption of crypto and blockchain, it is advisable to have a long-term focus, and the current situation could just be setting the pace.
Disclaimer: The information on this site is provided for discussion purposes only, and should not be misconstrued as investment advice. Under no circumstances does this information represent a recommendation to buy or sell securities.