What is the future for cryptocurrencies?
At their highest points, Bitcoin and Ethereum were valued at $20,000 and $1,400, respectively. Since then, they have slid to $6,250 and $290, respectively.
These 68 and 79 percent decreases have exemplified the rapid fall and distrust of cryptocurrencies – even the most popular ones. The exploding growth of crypto occurred largely due to successful initial coin offerings (ICOs), where different cryptocurrencies generated millions of dollars.
The fall of cryptocurrencies largely occurred from the lack of media traction and excitement. In a domino effect, media companies covered less news on cryptocurrencies because they were no longer hitting record highs and their unprecedented growth slowed. Consequently, less people heard about them, which made them more bullish on purchasing these cryptos. This created a negative feedback loop, creating a downward spiral in investments.
Plus, the lack of regulation and the increase in safety concerns created more reluctance for investors. With major hacks in East Asia and other regions, investors became less certain that cryptocurrencies were safe and decided to sell rather than buy.
However, it’s important to note that this has happened before – cryptocurrencies have been around for some time now, so it’s possible that this pattern will repeat itself. This could surely happen due to the Nasdaq founder’s introduction of its own crypto exchange Bakkt. This will likely lead to more regulation and easier accessibility.
Don’t sleep on cryptocurrencies just yet – they are due for another jump soon.