I’ve been writing a number of articles on cryptocurrencies and Bitcoin since July this year when it was still at 8000 -9000-ish. Since then, Bitcoin had stunningly fallen to a low with today’s close at $3700.
Charting a 74% loss in one year is scary – but not unexpected.
In July last year, I warned of a “massacre” which would sweep out weak alternative currencies and ICOs. Toward the end of 2018, we saw people pulling their money out of those ICOs, alt-coins and stronger regulations on cryptocurrencies. This, I believe, is just the start.
Investors need to stay away from the current crypto-markets until such time when one could definitively see a stabilization and widespread adoption of such alternative currencies. More importantly, value investors need to wait until a time when the intrinsic values of these currencies could be determined. Only then, could we say we want to “buy a dollar for 50 cents”.
On my 2019 prediction for where cryptocurrencies are heading… I expect the downtrend to continue till a point where even the average speculator might once again find these investments attractive. I’m guessing this could be anywhere in the upper hundreds.
The vision that cryptocurrencies can disrupt economies and “change the future” seems to have flaked out for now in view of their disappointing prices. However, I strongly believe in the long-term potential of these new innovations. Despite falling prices, businesses and governments are still hard at work figuring out new ways to transact, new Blockchain systems for better security, and so forth…
However, as an investment vehicle – I have to emphasize and conclude once again that it is still not the right time.