The 2018 crypto market was volatile enough to cause serious anxiety among even the most resilient of its supporters. Many of us were feeling a state of Zen on January 5, 2018 when a market snapshot revealed the price of Bitcoin was a rather healthy $16,665.
Unfortunately, the price tumbled soon after, and the bear market continued throughout the year. By December, when the price of Bitcoin was still falling well below $4,000, our state of Zen was replaced with a bit of panic, or at least some unease.
For crypto enthusiasts and the crypto curious alike, two questions emerge from a year featuring such turmoil:
First and foremost, what are some factors in the massive bear market-run of 2018?
Second, what are some predictions for 2019?
Now, I’d like to discuss a few things that jump out at me as catalysts for last year’s Crypto Crash. I’d also like to mention a few other points of interest that should shape the industry in 2019 and beyond.
What Really Happened in 2018?
ICO Explosion — For the newbies of the crypto world, ICO stands for initial coin offering. An ICO is basically how cryptocurrency startups are funded, either through private venture capital or more traditional lending institutions. The problem is, it’s a very risky investment even under the best of circumstances. Worse yet, well over one-thousand ICOs were introduced in 2018, virtually flooding the market with high-risk investment options for get-rich-quick dreamers to fall in love with.
Interestingly enough, the SEC took measures to begin regulation of ICOs in December of 2017, but it didn’t stop the explosion of ICOs from happening the following year. The simple truth is that most likely over 90 percent of those ICOs are going to fail (if they haven’t already). After all, that is the average success rate of a typical startup anyway.
The failure of these ICOs will serve only to fortify any negative connotations in the minds of consumers looking at crypto as a viable financial alternative. What’s needed is less quantity of crypto-backed startups and more quality.
Government Regulation — While government regulation is definitely a good thing to protect investors from a minefield of bad ICO investments, it’s never exactly a boost to any industry. Surely, many of the smaller investors in various ICOs are inexperienced millennials looking to get a piece of the next Amazon, Apple, or Bitcoin financial boom. and quite honestly, they may need the SEC to protect them from themselves. However, governmental regulation has a way of impeding innovation.
If 90 percent of the ICOs are destined to fail, that means that 10 percent could still succeed while providing a great service. Hopefully, SEC involvement doesn’t become so obstructionist that it prevents an amazing advance in technology from a crypto-backed business.
(Lack of) Blockchain Progress — Speaking of amazing advances in technology, blockchain is the engine that will drive a technological leap forward in the Digital Age. It’s already being introduced into a plethora of industries, from ideally-suited sources like finance, gaming, and real estate to less obvious places like education, agriculture, and healthcare.
The technology is so promising that many financial experts have referred to blockchain as the “new internet.” Unfortunately, 2018 didn’t involve the steps toward mass adoption that many crypto analysts were predicting and/or hoping for. There are several reasons for that underwhelming performance, but chief among them is fear of change.
People fear change in almost any industry, but they fear it exponentially greater in the world of finance because it’s so heavily involved in their well-being. Consider this, the first universally accepted credit card was Diners Club back in 1958, but it wasn’t until decades later that using credit cards became a widely used method of payment for most people. The moral of the story is that the average financial consumer needs time to become comfortable with a new system for secure transactions.
For the crypto industry to revive itself from the crash of 2018, blockchain backers need to become much more vigilant in their pursuit of mass adoption.
If the concept of blockchain is still foreign to you, check out this beginner’s guide to how it works and more specifically, its relation to cryptocurrency and Bitcoin.
Why Poverty Needs Crypto
I strongly believe in the ability of crypto to assist the two billion+ impoverished and unbanked people in the world to join the global economy. Crypto can give these people a viable financial alternative that’s impervious to interference from their own corrupt governments.
Will these two billion people suddenly break free from the chains of poverty and corruption to drive crypto to new heights in 2019?!
However, baby steps should begin soon enough. Most experts agree that up to 90 percent of the currently unbanked population will obtain smartphones within five years. Once the tool is placed into the hands of the people who need it, it’s only a matter of time before they effectively use it for a better way of life. A smartphone is all they need to gain internet access and acquire a digital wallet. Although it won’t magically happen in one year, a rising number of people around the globe are considering crypto as a viable financial alternative to their less than ideal, current financial situation, and that trend should continue in 2019 and beyond.
Countries in Crisis — Citizens in some countries have already turned to Bitcoin as a superior option to their incredibly unstable national currency. In these nations, inflation has gone so far out of control that people need to bring enormous sacs of bills to exchange for simple items of necessity, such as bread and milk. Consider that one USD equals over 30,000 Iranian rial. Also, understand that the government in Venezuela actually devalued the bolivar by 99 percent last year and introduced an entirely new currency in August.
Crypto provides people, whether they’re unbanked or just embroiled in an economic crisis, with total financial autonomy, where they hold the keys to their own financial success independent of government involvement.
A Bitcoin Rebound? — Considering the over 80 percent market drop of Bitcoin from its highs, what should we expect from the world’s most popular and most valuable cryptocurrency this year?
Now that you’ve read my two tokens work, let’s examine the insight from some of the industry’s most prominent and popular personalities:
She is the CEO and co-founder of Lightning Labs and has a strong presence in the Bitcoin community. Elizabeth Stark definitively remains a crypto realist.
For example, in October of 2018 when many influencers were calling for an end to the Crypto Crash and the promise of brighter days immediately over the horizon, Stark remained cautious, stating her suspicion that legacy financial networks would present an increasingly troublesome obstacle to crypto’s growth and sustainability.
At that point, the price of Bitcoin was still over $6,000. Not long after, the market tumbled even further than most industry experts were predicting.
Despite her cautionary tales, Stark is indeed a crypto supporter. Her company — Lightning Labs — leverages blockchain technology to offer real-world business applications. She urges crypto stakeholders to remain confident, saying, “Bitcoin is a marathon, not a sprint.”
Follow her on Twitter here: @starkness.
Movie goers might describe the embodiment of pure evil as Darth Vader or Michael Myers. Those deeply rooted in the crypto community would likely have a slightly different take, pointing firmly in the direction of Nouriel Roubini. This notion is supplanted by the fact that he is actually called “Dr. Doom” in his profile in the NY Times.
Doom and gloom aside, the highly esteemed American economist and renowned professor at NYU’s Stern School of Business is a card-carrying crypto critic, most recently saying, “It is time to see the light and give up on useless Bitcoin.” Big picture, he sees Bitcoin as nothing more than a clever financial workaround, destined to reside in a museum of quirky economic failures some day in the near future.
One interesting note of relevance to that apocalyptic viewpoint is that Ubini has accurately predicted both the sub-prime mortgage crisis of 2008 and the Crypto Crash of 2018. For that reason, he has earned his reputation as a serious skeptic with legitimate merit to his hypotheses.
Follow Dr. Doom on Twitter here: @Nouriel
Pretty much the polar opposite outlook from Roubini, the somewhat infamous tech entrepreneur offers the following prediction, “I believe that Bitcoin will end 2019 somewhere between $50,000 and $100,000.” Never at a loss for words, the controversial and outspoken McAfee backed up that comment by saying he would eat a certain body part if he were wrong. Hint: That body part was not an arm or a leg, but an appendage of a far more potentially painful nature.
Follow him on Twitter here (at your own discretion, of course): @officialmcafee
Now, you have Stark’s realism, Roubini’s pessimism and McAfee’s optimism to chew on for a while when considering your own crypto investments for 2019. Click here for a listing of other Twitter accounts to follow from the most brilliant and influential blockchain and crypto analysts in the world.
BuySellHODL’s Crypto Ratings & Bitcoin Predictions For 2019
Ok, now that we’ve heard from the experts, let’s get some hard data from other crypto-enthusiasts. My newly launched Crypto App, BuySellHODL, surveys our crypto community regularly to generate crypto ratings and market sentiment data including Real-Time Crypto Ratings, Top Coin Picks, and Coin Price Targets. Currently, the crypto-sentiment is surprisingly positive with 54% of users assigning a ‘Buy’ Rating to the various coins, which is more than twice the amount (26%) of ‘Sell’ Ratings given.
BuySellHODL’ers are even more optimistic about Bitcoin’s 2019 prospects, ranking Bitcoin as their number one cryptocurrency pick for 2019. An impressive 60% say to ‘Buy’ Bitcoin, while only 17% say to sell it. With 3.5 times more people saying to ‘Buy’ vs ‘Sell’ Bitcoin, our proprietary ratings and price target formulas have assigned Bitcoin a ‘Buy’ Rating, with a 2019 price target of $6,396.
Note, if Bitcoin touches anywhere near $6,400 in 2019, crypto-enthusiasts will be jumping for joy, as this would represent a healthy 89% upside from today’s price. Also, as Bitcoin goes, so do the Altcoins, so this prediction bolds well for the overall crypto market.
Bitcoin’s Future – Can’t We All Just Get Along?
The 5-year price predictions paint an interesting picture as to the strongly divergent opinions of Bitcoin’s future. An impressive 54% predict that Bitcoin will be worth more than $10,000 in 5 years, which is almost triple today’s price. Even more encouraging is that 15% predict a Bitcoin value of more than $100,000. And an incredible 4% believe that Bitcoin will be worth a cool Million!
However, this bullish Bitcoin data is in stark contrast to the healthy amount of extreme pessimists, 17% of them to be exact, who believe that Bitcoin will be completely worthless in 5 years. In other words, we will either all be using Bitcoin for our Starbucks and Amazon Prime Purchases, or throwing out our Crypto Private Keys like 1990’s Baseball Cards in a few years.
Here is a complete breakdown of the 1 & 5-Year BuySellHODL predictions for the Crypto Market & Bitcoin:
Break those numbers down any way you see fit, but I agree with the consensus of my users that Bitcoin should rebound from its sharp decline in 2018. The Bitcoin $1 Million 5-Year predictions are also not as far-fetched as they sound. John McAfee suggests that we will see Bitcoin at $1 Million even sooner, by the end of 2020, and there is some interesting math to support these price levels premised upon Bitcoin becoming the Global Reserve Currency. I’m more in the 5-year Million-Dollar-Bitcoin-Camp as I’ve learned my lessons the hard way of looking like a fool when making short-term Bitcoin Predictions.
One part of my reason for being bullish is that Bitcoin has already gone through several similar bull to bear market runs.
As recent as the beginning of 2015, the market was down 85 percent before it shot up to the record high of almost $20,000 in December of 2017. The subsequent downfall is just the latest in such a market correction and we should see another steady rise to follow.
Additionally, there are several meaningful catalysts gaining steam that may come to fruition in 2019. Just one of them becoming true will produce some desperately needed positive crypto headlines, and likely be the end of the crypto carnage.
Potential catalysts include an improved investment environment led by more regulation and institutional grade products, which seem to be on track for meaningful developments in 2019. But what would be even more compelling, is greater crypto adoption in countries with failing currencies, such as Venezuela, ultimately proving cryptocurrency to be a viable (and perhaps superior) alternative to fiat currency. These game-changing positive Crypto developments will take time to fully materialize, but investors who are patient should be rewarded nicely. However, as we’ve seen with crypto, the only safe prediction is that the unpredictable will happen.
Final Thoughts (for now)
What is the most likely scenario for crypto’s fate in 2019? It’s probably somewhere between Roubini’s doom and gloom prognostication and McAffe’s unfettered optimism. My own thoughts probably align a little more closely with Elizabeth Stark’s, but I’m hopeful that 2019 will be north of that viewpoint as well.
The bottom line is that crypto is still an industry emerging from infancy. It’s got a long way to go, but it also has such exciting potential, I can’t imagine not wanting to be in on it as we exit the hype phase and enter the phase where its true potential (hopefully) begins to be realized.
I’m going to watch its evolution carefully, and perhaps by this time next year, I’ll be posting a follow-up article with the following title:
“Why 2019 was such a booming success for Crypto, and will it continue into 2020?”
For now, make sure to check out the Crypto Ratings & Predictions on BuySellHODL, where you can even win some good old-fashioned cash in our Live Daily Bitcoin Game.
Cliff Lerner is a successful entrepreneur and Author of the Best-Seller Business Book, Explosive Growth — A Few Things I Learned Growing To 100 Million Users. He advises fast-growing startups, is a crypto-enthusiast, and recently launched his new Cryptocurrency App, BuySellHODL, whose goal is to get 100 Million Users to adopt Crypto.
Disclaimer: This information is meant for informational purposes only as myself nor BuySellHODL provides financial advice. Please consult your financial advisor before trading in cryptocurrencies. BuySellHODL is not accountable, directly or indirectly, for any damage or loss incurred, alleged or otherwise, in connection to the use or reliance of any content you read here or on our properties. Please read our full disclaimer.
Bitcoins and Gravy
Man that was a silly article.