Economist Nouriel Roubini who predicted the 2008 financial crisis mentioned a few days ago that “Crypto bubble went bust for good”. Is this a fair assessment of the crypto market? In 2017, Bitcoin went from around $1,000 to near $20,000. But 2018 was a different story. The crypto market lost 80% of its market cap since its peak. And for this reason, could it really be a bubble?
If you are going to ask the opinion of Lou Kerner who is the co-founder and partner of CryptoOracle, Kerner believes that patience is key when it comes to investing in Bitcoin. Kerner explained that “If you go back to the internet bubble, which is what a lot of us in crypto look at for direction, Amazon arguably one of the greatest companies in history of the mankind, was down over 95 percent over two years”.
HODL and Wait for The Bull Run
If you opt to invest in Bitcoin or in other cryptocurrencies, it is imperative to understand that it is a highly volatile investment. It was explained that the reason is that digital assets lack underlying value aside from confidence. Kerner mentioned that “I think it’s a store of value. I think it’s the greatest store of value ever created. It should surpass gold over time. It won’t happen overnight”.
There are those who are hoping that institutional investors could actually trigger a 180-degree turnaround for cryptos soon. The US Securities and Exchange Commission has been doing its best in order to regulate the industry. This year alone, it considered Bitcoin and Ethereum as commodities while recently, it was hunting down on ICOs that are selling unregistered securities.
You also have the possibility of having a Bitcoin ETF. Over the last months, crypto investors and observers are hoping that the VanEck and Solid X Bitcoin ETF application is going to get approved. That was after a number of Bitcoin ETF applications were rejected by the agency citing the possibility of price manipulation.
Still With a Bullish View?
Tom Lee still has a bullish view of Bitcoin. In fact, though he adjusted the initial $25K prediction by the end of the year, Tom Lee still believes that Bitcoin could potentially hit $15K still. Lee described the recent correction as “awkward transition”.
Lee is optimistic that institutional investors are going to go after the crypto market once there is regulatory clarity. Adam Beck is another diehard crypto believer. He is the CEO of Blockstream saying in a tweet that “I consider $250K-$500K/BTC plausible in the years ahead, from the digital gold, censor-resistant competitor to physical gold, and internet native digital money”.
Is this a Short-Term Slump?
There are those also who believe that the recent bearish market is only short term. In fact, Bitcoin was stable at around $6,200 to $6,500 in recent months. There were even those who thought that the market was actually maturing.
The reason for the reason slump is because of the Bitcoin Cash hard fork that may have potentially caused FUD in the market. Now, if you are looking at sign whether or not to let go of Bitcoin, whales bought a massive amount of BTC after it slumped below $6K.