The cryptocurrency market has been in a bear trend since the beginning of the current year. Most of the virtual currencies are registering a price decrease of more than 80% since their all-time highs.
During 2017, there was a lot of hype around virtual currencies and blockchain technology. They entered the market trying to create a new economy promising to change many different industries. This is something that can be seen in the Initial Coin Offering (ICO) boom at the end of 2017 and the beginning of 2018.
This is something that can be compared to the Nasdaq Composite Index that peaked back in the year 2000. Internet companies were expanding like no other firms. Investors believed that the internet was going to revolutionize the world and these companies were going to create revolutionary platforms. However, this market plummetted and some companies were not able to grow up again.
The crypto market experienced a similar situation. At the beginning of the year, the whole market capitalization of virtual currencies was going to reach $1 trillion. Although this number couldn’t be reached, the whole market cap ended close to $850 billion. Since that moment, it dived down to $100 billion.
Growing once again from that situation is not an easy task. Indeed, it might be very difficult for some virtual currencies to recover previous prices. At the moment, several projects without new proposals or clear solutions to many problems are not going to survive, and indeed, some of them have already disappeared. However, those that seem to have better proposals and follow market’s demands are performing better.
Bitcoin (BTC), for example, is a virtual currency that attracts several investors and that remains as the largest virtual currency in the market. In the future, Bitcoin could be used as a store of value such as gold. Ethereum (ETH) is being used by companies all over the world to base their platforms and systems. They build on top of Ethereum’s platform and smart contract capabilities.
In 2018, companies and firms working in the crypto space have been signing new partnerships. At the same time, the number of individuals and developers working on these projects has increased amid the bear market.
Now there are several experts that believe that virtual currencies have reached a bottom. This could be just the beginning of a slow recovery that can take not months, but years. According to some analysts, once virtual currencies recover the price they had at their all-time high, the upward trend accelerates.
Nevertheless, it is important to determine whether we have already reached a bottom or no. After it, cryptocurrencies will be experiencing an organic growth that would help them recover their price.