In order for Bitcoin and cryptocurrency to be adopted, both Mainstreet and Wallstreet must buy in to the use case of this new product. A fully bearish 2018 has weathered many investors and potential adopters from both camps. The Bitcoin ETF, government regulation, SEC inquiries and major bear market that blasted the total cryptocurrency market from $840 billion to just $180 billion have made pessimists of all but the most die hard cryptocurrency fanboys. Or has it? I am convinced that mass bitcoin adoption is right over the horizon and that within 2-years, we will reap the rewards.
The major bullish thesis for Bitcoin is it’s usage during crisis. During 2017, Venezuela’s economy collapsed and the currency, the Bolivar, saw thousands of percentages of inflation. The new Bolivar, called the “sovereign bolivar” is worth 100,000 bolivars. During the crisis, Venezuelans bought and used Bitcoin and Dash to protect their wealth: https://bitcoinist.com/venezuela-record-bitcoin-october/. Bitcoin filled the void that gold may have during the crisis. As world markets have fallen double-digit percentages this year, and a bear market looks to be in the cards in 2019, investors who has fled to gold will flee to Bitcoin and cryptocurrency increasing demand.
Nations all over the world are adopting Bitcoin, and India’s population of over 1 billion people could lead to huge demand. The problem is that India’s Central Bank has made Bitcoin all but illegal and is shutting down exchanges. India’s demographics support continued adoption of cryptocurrencies, as there are millions of young people who will grow up with cryptocurrency. Zebpay, the Indian cryptocurrency exchange was shut down, and the cryptocurrency market in India has been blasted. As Indian regulations become less restrictive on cryptocurrency in the future, cryptocurrency will take the place of gold as a safe medium of wealth storage.
Investment firms and hedge funds are slowly and silently creeping into Bitcoin and cryptocurrency as their investment of choice. The Cryptocurrency VanEck Vectors ETF is getting closer, and their ETF could attract billions of dollars into the space. VanEck would be required to buy and hold cryptocurrency to support the ETF and investors who are reluctant to enter the cryptocurrency market could participate. VanEck has been working with the SEC to make a compliant product https://www.ccn.com/bitcoin-etf-could-attract-billions-in-new-investment-vaneck/. If this ETF leads to further investment vehicles adopted by Wallstreet, pension and 401k plans could add billions if not trillions to the cryptocurrency market. It’s just around the corner and will allow Wallstreet to jump directly into the game. Hedge funds like Circuit Capital are betting on widespread adoption and more investment talent is focusing on the sector.
The future is bright for cryptocurrency. Those who buy at low prices now will reap the rewards later. Expect the bear market to last between 8-18 months. Good luck to all!