So far, 2018 hasn’t been the best year for cryptocurrencies. The bearish sentiment that followed the euphoria at the end of 2017 seems to be running the show, but is this the end of cryptocurrencies, or merely the downside that comes before a resounding turnaround in fortunes?
Yoni Assia, CEO of eToro believs that selling your ryptocurrency now is like selling Apple stock back in 2001, when it was falling in value. It is easy to see why many people are selling off their holdings, especially if you didn’t get into crypto s a long-term investment, but if you do take a longer view of the market, then perhaps there is a good reason to hold on to those crypto assets for a while longer and see how it all plays out.
If we look at Bitcoin’s past trends, it doesn’t seem over ambitious to claim that there is likely to be an upswing towards the end of 2018. If that happens and you sell now, then you stand to lose money.
ICOs are the real ‘bubble’
Assia told Business Insider that one thing to look at in the crypto market is the number of startups issuing tokens in ICOs. He believes that “95% of them will end up as nothing, because that’s startup funding.” What he means is that the majority of tokens will simply fade away, leaving the strongest ones to lead the crypto market. These are probably going to be Bitcoin, Ethereum, Litecoin and a few more.
Dominik Schiener, creator of IOTA said earlier this year that he expects less than 10 of the 1,400 crypto projects that have started in the last year to survive. That’s quite a radical figure.
Neither Assia or Schiener are sceptical about crypto; they are both supporters of the sector, but what they are saying is that as with the dotcom era, many projects will get funding but not survive. However, those that do are likely to transform the world and make their investors big money.
What Assia is really saying is that it is ICOs that are ‘the bubble’, not cryptocurrencies or the blockchain. Many of them simply aren’t viable. But their demise will pave the way for true cryptocurrencies to succeed in the future.
We may not be in quite the same situation as Apple stock holders were in 2001, but it has a ring of familiarity. Still, if we remember that correctly, after that massive sell-off, Apple’s stock went on to gain a staggering amount of value, and who is to say that crypto won’t do exactly the same. It might look like a washout at the moment, but give crypto time and you might be glad you held on to your assets.