Many cryptoanalysts and investors think that we are at the tail end of the bear run which has lasted for over a year now.
Although there are those who think that things will continue to get worse for Bitcoin and other cryptocurrencies.
Mining Has Become Unsustainable
Bitcoin mining industry almost came to a halt during 2018 as a result of many different factors. The cost of energy worldwide has risen, through inflation and through increased demand for fuel and power. As the price of these bills rises, profit margins shrink, so, you end up paying more money to mine less Bitcoin and thus, your reward is reduced.
Sadly, through 2019 energy bills are only expected to rise. Bitcoin mining uses very powerful computer products such as graphics cards that frankly cost a lot of money. During the cryptocurrency boom of 2017, the price of these products shot up as suddenly.
Regulatory uncertainty will continue to inhibit the widespread adoption of cryptocurrencies. Though the U.S. federal government has made progress in regulating cryptocurrencies, uncertainty and ambiguity at the state level will be more difficult to overcome.
Individuals and businesses must inevitably wait for laws to be figured out and enacted before new technologies can be fully utilized. This has been particularly true of cryptocurrencies — most notably Bitcoin and financial technologies — which have been hindered by a lack of regulation and an abundance of confusion.
Crypto market is far more complex than the traditional trading markets. With estimates like 70 percent of the crypto market being manipulated by wash trading, pump, and dump, spoofing and front-running scheme, it makes sense that a more complex solution would be the best option for getting the SEC’s Bitcoin ETF approval.
A more complex market provides the perfect opportunity for market abuse and manipulation. Since smart contracts and blockchain offer extra layers of complexity, it makes sense that the best solution would be one that is market derived and based on the same technologies driving its native market.
Skepticism With Traditional Investors
Institutional investors are being scared off by the protracted crypto bear market. JPMorgan says the Crypto Winter has caused mass attrition among unprofitable miners as the hashrate has continued to unravel during the past few months.
JPMorgan’s skepticism toward bitcoin is not new, and it comes straight from the top. The investment bank’s CEO, Jamie Dimon, openly hates bitcoin and has often bashed it as “a fraud.” He is not alone, traditional old-school investors like Warren Buffet had earlier called it “rat poison”.