Dragonfly Capital Partner Echos How Bitcoin Will Weather the Bear Market Storm vs Falling Further
As the world bids adieu to the year that was 2018 and prepares for the holiday season, most traders in the business of dealing with cryptos have a singular common question. Will Bitcoin [BTC], and by extension other digital currencies, survive or collapse?
End Of Days?
The end of 2017 had promised the age of digital currencies. So when the crash of Bitcoin market prices in early 2018 happened, some presumed it was the market correcting itself. Since the start of the year, crypto prices have collectively fallen over a staggering 80 percent. Many cynics have used this to cite the end of all crypto assets. Some are worried that the unbalanced mining ecosystem of Bitcoin will lead to a cyclical effect. It will result in a hashrate drought that will cause panicked miners to leave and will inevitably lead BTC into a death spiral. And then there is the fear that the U.S. Securities and Exchange Commission and other regulatory bodies will enforce stringent measures that will make any business proposition an ardent task , leading to the demise of most cryptocurrencies.
While scepticism is healthy for any industry, there are a lot of people who plainly disagree with the apocalyptic warnings. These backers of blockchain have kept an unwavering faith in this digital asset, even with the fluctuating prices, sinking towards $3700 at the time of writing.
And these are not just some crypto enthusiasts or cyperpunks. As noted in this site, veteran trader Peter Brandt had predicted the price fluctuations, in fact, he is expecting a further fall in prices; expecting BTC to stabilise at around $1200. He has also foretold of BTC price patterns following a familiar path, which will see the coin raise up again.
This sentient is shared at Dragonfly Capital Partners. At a recent interview with Forbes, Alex Pack, a partner at the firm, discussed BTC and its chances. He feels even if the market value of the coin falls to $1,000, it has already developed a material value proposition. So the coin will not drop to zero as some nay sayers are predicting. Calling the technology a “landmark in the history of money,” he has also highlighted the viability of Bitcoin being used as digital gold.
There are many in favour of using BTC in this fashion, primarily due to its scarcity and focus on decentralization. Owing to this, many in the financial sector, such as CEO of Messari, Ryan Selkis have stated the obvious benefits of using this to secure against possible inflationary recession. Echoing similar sentiments to Alex, Ryan was quoted saying “Something like Bitcoin has become a more dependable store of value. People buying and using it have got to be confident it’s not going to zero.”
Rise Of Bitcoin.
While to many it seems that this bear market has been the death knell of Cryptos, a little perspective is needed. While gold has climbed from about $1200 to $1300 from 2014 to 2018. The value of BTC has increased from $400 to about $4000. Undoubtedly, the market instability is an issue that needs to be addressed. However, the bull run has had an undeniable impact on this nascent industry. Bringing it in to public consciousness, all this mainstream media coverage can only auger well for the technology.
Despite the markets, there are continuous efforts to make bitcoin more accessible. It is to be launched from the New York Stock Exchange as well as the Nasdaq. These factors inspire Alex and he positively notes:
“The question now is how long this bear market will last? The death cries seem far softer than in previous downturns and the people involved now have more patience. We think we’ll be able to weather the storm.”
With the underlying technology already widely acknowledged as being a game changer and perpetual efforts by various start-ups, investors are not yet willing to give up on it. This certainly gives the impression that, contrary to what some might claim, crypto assets are not only not on their death bed, this is a segment ready to fight. Will the faithful hold their nerves to allow for this market cycle to play out its natural course or will the faithless win, only time will tell.