Bitcoin itself is a mysterious asset. Founded by an unknown person or group, manipulated by whales and linked to secret “deep web” transactions among other things, Bitcoin was of little interest to me before 2017. Truth be told, Bitcoin was never “marketed” to me before the price started to take off and scores of Youtube videos, Coinbase advertisements, ICO ads on Facebook and television spots flooded my world. Bitcoin itself lost the interest of the “little guy” in 2018 even though it lost 90% of its value in 2011 and 82% in 2015. Bitcoin and the cryptocurrency market were misrepresented as the “future of everything” and a bubble inflated with new money that may never return. The interest of the “little guy” will be filled in with the money of investment houses in 2019, and a resurgence of the cryptocurrency sector will occur.

In 2017, I opened an Android App on my phone I had downloaded a year before. That App was Coinbase. I was attracted by the recent news of the fall of Bitcoin to $1,800 and decided to make a quick buck on the dead-cat bounce. This was the beginning of my involvement in cryptocurrency that led me to become a fanatic, as the bubble of 2017 inflated; I profited heavily and built a community around the asset. Bitcoin isn’t the only game in town, but as long as its market dominance > 50%, it drives the market.

In 2019, the game will change. The Nasdaq Bitcoin futures market will open, a Bitcoin ETF will likely trade on the exchange and demand will build for Bitcoin as mining operation costs fall. Cryptocurrencies like Monero and Ethereum may gain more interest as large institutions mull “universal basic income” and in-app cryptocurrency purchases.

People love gold coins because they are money you can hold. It’s an asset that holds value. Bitcoin is the same way, and like gold can be securitized by institutions. The market will re-inflate in 2019 as low prices spur demand. Think of Bitcoin like oil. As oil prices decrease, gasoline becomes more viable as an energy source and demand for oil is spurred. Watch the Nasdaq Bitcoin futures and the Bitcoin ETF require institutions to purchase Bitcoin and spur demand.

Sources:

https://www.forbes.com/sites/greatspeculations/2018/12/07/bitcoin-looks-undervalued-despite-subdued-activity-levels-uncertain-growth-prospects/#556cefed7ee3

https://www.forbes.com/sites/forbesfinancecouncil/2018/12/07/is-bitcoin-going-to-zero/

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Responses

  1. SouthernCrossroads

    This is an insightful piece. I see two major points that really stand out in your work, the future is going to be driven by institutional investing and the Altcoin market has to decouple from Bitcoin.

    Institutional investing is at the same time necessary and toxic to the idea of crypto. The banking system has the money to really make move up or down with manipulated prices movements. We are on the verge of either collapse in the United States or conceding that crypto must become mainstream and behave itself or be crushed. This is highlighted with last weeks collapse of ETC.

    While this seems particularly bleak the current market is an opportunity for the Alt market to break out and at least some of those coins will be able to define themself apart from Bitcoin and hopefully will rise apart from Bitcoin. The only real means for crypto to break free of institutional money is for there to be real competition to their financial instruments.

    Great work, very insightful. I did mention you and this piece at https://trybe.one/trybe-quality-content-booster-help-find-your-favorite-articles/

    Have a good one…

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