2018 was and continues to be in many ways, the natural and only continuation of the events that took place in 2017. Back then, the boom of the crypto prices took digital currencies like bitcoin sky-high. In a spate of several short months, this cryptocurrency managed to climb and climb until it reached a point of $20,000 for a single BTC token. For some, this was, as the famous movie says, madness, but others, especially crypto evangelist, perceived the entire setup as a completely expected progression that took the price in the only logical direction.
Any mention of a bitcoin or crypto bubble were often mocked to no end in the crypto community circles and there was, for many, no reason to be afraid. The prices could sink for a short while, but then they would be back, bigger than ever. People like John Mcafee were predicting that by the end of 2018, bitcoin would reach the price of $80,000. Others saw it climb even higher, vastly overcoming all of their valuables in the history of the world in terms of its price hike.
Now, with December well underway and the final weeks of the year, it is safe to say that Mcafee did not read the tea leaves completely correctly. With crypto prices tumbling down on a pretty regular anything over a previous couple of months, many are once again revising the theory of a crypto bubble and its further movement to the ultimate value of $0 across the crypto trading board. Yet, is there a chance the entire process is a new alignment opportunity that could weed out the negative elements and allow the crypto screen to once again flourish outside of the full news cycle of the mainstream attention?
Engaging in Crypto
For some time, there have been many cases of individuals who made a huge fortune in crypto deciding to actively start giving out small parts of their cryptocurrency holdings to first-time users. The main idea behind this strange and modern way of generosity is to speed up and spread adoption. There are millions who are interested in owning crypto and doing – something – with it for years. Yet, many of them never did anything to procure it, including buying or earning it. In that case, the same gift of a bit of crypto is the ideal way for someone to dip their toes in the cryptocurrency field.
But, at the same time, this kind of random crypto distribution is very problematic. Often, when these giveaways occur, those doing the giving are eager to show how fast a small sum of crypto can rise in price substantially. In other words, a small gift that took place a year before could now be several times as large thanks to the crypto price growth like the one seen in 2017. Back then, anyone who used crypto for anything in between investment and online BTC betting could have seen its value jump up and up over months.
After all, 2017 took BTC from $1k to $20k in a space that did not encompass the entire year. During this time, any benefactor that gave out $100 in bitcoin could show that their gift is now 10 times as big as its way initially. However, the problem with this type of mentality is the sheer fact that it once again values crypto only as its reflection on the price in terms of fiat. Currently, many inside of the crypto domain are coming to terms that the single metrics of the price of the token in fiat terms is not the best way to measure cryptocurrencies. In fact, it is one of the worst ways to do it and it still remains the most popular and widely reported way of doing it.
The Communication Problem
The main problem behind this type of thinking is not the idea that those who share cryptocurrencies are not clearly underlying their importance as financial technology. Sure, they are not talking about the fact that these digital assets cannot be copied or reproduced thanks to their unique fingerprints inside of their blockchain networks. They are not even addressing the concepts like no-government financial entities or the fact that their entire ledger could be carried by a tiny amount of computers.
Instead, they are talking only one language to the interested individuals around them and that is the language of the quick buck. The notion behind all of these is the simple but painful trajectory they are suggesting to everyone – you too could get as rich as me using cryptocurrencies.
The mindset is what attracted the pump and dump crowd to crypto and many foolish investments that took place in late 2017 when everyone was seemingly chasing “the next bitcoin”. In this regard, the problem of crypto is not that its adoption is not clearly communicated – it is not, but this is not the main choke point. Instead, it is the fact that only the most problematic elements of it are put front and center – the idea that it is nothing more but a tool for generating quick profits that could potentially become a fortune.
The Burst Bubble that was not There
The catastrophic bubble that many predicted in crypto did not happen, but what did happen was the exit of many individuals who perceived crypto like it was mentioned previously. They are the ones who lost money and faith in cryptocurrencies they never really had in the first place. The price of the entire system when with it, not just compared to fiat prices, but also a market cap, social media signals and the number of developments that are implemented or planned.
In many ways, this is the bubble bursting on some level, just like it did in 2014. The prices will drop further and the confidence will be even more shaken. In essence, this is the onset of the crypto winter and the exit out of it will be long and painful. Just like it happens in esports, SaaS platforms and many other ventures in the digital realm, the technical issues coincide with the way the targeted group perceives the same domain. Right now, the perception of the crypto field is not that rosy.
The process of confidence rebuilding will not take place rapidly. Previously, it took over two years for the results to once again go into green. ETH is down 90 percent from its highest value, BTC is down 75 percent and the whole market dropped by market capitalization by 80 percent. The winter ahead will be frosty, but from the ice and trepidation could once again rise a fresh space that would allow for both growth and sustainability.