Does this recent decline in the cryptocurrency market mean investors have finally come to their senses that the market is unstable? Have investors finally realized that there was a massive bubble that the cryptocurrency? The Dotcom Bubble, which is very similar in characteristics to the Cryptocurrency Bubble resulted in the closure, bankruptcies, or legal prosecution of hundreds of companies. We see similar characteristics such as an influx of new ICO's, of which 90% of them are useless, and dead after a short time. According to Dead Coin, currently, there are 930 coins that are deceased, abandoned, or deemed a scam. People have come to the realization that like fiat, crypto has been hacked, stolen, and manipulated. The benefits of crypto have drastically fallen from what was once promised. It became slow and expensive, while not being as secure as claimed. Majority of traders were very inexperienced traders who purchased bitcoin on credit, mortgages, and loans. So, it would seem that cryptocurrency has perceived value due to fiat (dollars, euros, misc). Traders invest fiat, gain profits, and sell for fiat. This makes crypto essentially a trading tool but itself is worthless, because there is no perceived value of cryptocurrency. Do each of the 2,000 coins have value? Are they all accepted? Are they accepted everywhere? Are there exchange rates? Can they be exchanged? These are the important questions asked by investors. Bitcoin, among other cryptocurrencies seem less accepted today vs during the boom of 2017. From what we heard, a big player in the decision was that crypto is no longer stable and have lost confidence. Below, we explain the 3 points on our charts:
Point 1 - We were reading that at this point, BTC was stabilizing and was poised to breakout. BTC traded pretty much flat for most of October, which many traders thought brought the end of the bear market for Bitcoin.
Point 2 - At this point, Bitcoin and the entire cryptocurrency market proved it was not a safe-haven against stock market volatility. Bitcoin has dropped in parallel with the stock market (not in percentage or points) but in a general sell off. There were bits of news here and there that may have influenced prices across the crypto market, but confidence has faltered and fear has set in.
Point 3 - We believe this is the most important point. This point is a future prediction, which we believe in that will take place WITHIN 2019. We believe investors and traders of the cryptocurrency have finally come to terms with the massive bubble that it became. According to CoinMarketCap, there are over 2,050 crypto currencies! Yet, at the same time the entire market cap has been shrinking. This is the biggest sign of a bubble. We believe the bubble popped and is continuing to deflate. We believe this drop in Bitcoin and the cryptocurrencies will continue to deflate, until a massive restructuring takes place, either by government involvement or not. In this restructuring, we will see well over 1,000 cryptocurrencies simply vanish.
So, what is the solution?
In conjunction with the stock market, we believe that the crypto market will also continue downward. The stock market has entered bear market and there is talk that GDP will come to a halt in 2019, below 2% with a big chance of recession. Many cryptocurrency experts state that the market is still in capitulation and predict bitcoin to reach back into the hundreds of dollars. Get out while you still can. You will see the vanishing of majority of the cryptocurrencies during this downtrend. Protect yourself with assets of actual value. Bitcoin is not digital gold, its digital fools gold. You decide, $4,000 for some coding or $4,000 for precious metals that survived every great financial decline? Will there be those who shout "Your crazy, your wrong" absolutely, but we were telling investors/traders to get out in Jan of 2018 where others stated "it was a correction". A correction is defined as a 10% decline, its now been over 80%. We understand, no one wants sobering news that the asset that helped many people make some extra money, is coming down and has further pain ahead.
*Disclaimer
As cryptocurrency is an entirely new type of investment class, predicting crypto has proved to be extremely difficult, even to self proclaimed experts. Our prediction is based on historical financial assets, bubbles, and trends. Bitcoin has a possibility of reversing upward, but the odds of this are extremely remote. We standby our claim that the bubble and capitulation has not ended. Best of luck!
Comment:
We fully expect "Buy the Decline" which will point Bitcoin upward, but the overall trend has been a downward sell-off.
Comment:
11/24/2018 - Bitcoin is following our chart, went slightly up on those who bought the dip but fell through $4,000 mark, currently sitting at $3,800(+/-). Sell, and get out. The cryptocurrency market MUST go through a total restructuring, the dead coins MUST be wiped out, and everything must settle before there can be discussions of investment.
People like to point out that Bitcoin crashed 90% in recent years, but, back then Bitcoin was sitting essentially alone. Today? 2,074 new coins. Do the math. Get out, get precious metals, and ride the volatility that is going to hit the stock & crypto markets like 2008 never dreamed of.
People like to point out that Bitcoin crashed 90% in recent years, but, back then Bitcoin was sitting essentially alone. Today? 2,074 new coins. Do the math. Get out, get precious metals, and ride the volatility that is going to hit the stock & crypto markets like 2008 never dreamed of.
Comment:
BTC has followed our chart to the point so far. 2019 could shape to be a continued downtrend.
