An epenize server recently published an article mentioning a certain investment manager about the cryptocurrency collapse. Unfortunately, the text has little to do with reality. The only thing you will learn here is how it turns out when the cause and effect are changed and the child spills out with the tub. Let’s get the situation right.
The original article to which I respond:
Source: epenize.cz
Cyclic development of cryptocurrencies
The author mentions in the article a huge decrease in the value of Bitcoin. However, it is taken out of context, it only talks about the correction that came after ATH (all time high) in 2017, when Bitcoin lost 80% of its value. Those who began to doubt were the same ones who invested in the phase FOMO (Fear Of Missing Out) and who, in the image of miraculous enrichment, helped drive the BTC prize to $ 20,000.
But those who understand Bitcoin and cryptocurrencies do not only follow the price, but also the technical, product and overall historical development. Just as every economy has its cycles, cryptocurrencies undergo cyclical developments. A view from a broader perspective speaks for itself, see. development of the price of cryptocurrencies in 2013, 2017, 2020.
Decentralization as a timeless value
However, bitcoin and the entire cryptocurrency industry do not depend on technical developments. Bitcoin is the first currency / asset that is independent of the state, ie decentralized.
Bitcoin and other cryptocurrencies have been shown several times to be stable despite their instability (their market is still small and young). In countries facing a financial crisis and where people have lost access to their bank accounts (eg Argentina), investing in cryptocurrencies has become the only way to manage their assets and not fall victim to hyperinflation or confiscation. The financial crisis caused by the pandemic of a new type of coronavirus, which is creeping the word around the world, will, in my opinion, be another opportunity for the cryptocurrency industry.
Beware of suspicious projects
Over the last five years of my career in the cryptocurrency field, I have witnessed a number of interesting ideas. Some were crazy and impractical, others crazy and very practical, and others were just about selling hot air to naive investors.
Conclusion
Today, there are over 2,000 cryptocurrencies and tokens. However, only those that will function as a means of payment will remain functional, or that will give their owners certain rights (eg ICO or STO), or special assets such as IOTA, which is intended for industrial use. I must agree with the author of the article on the collapse of cryptocurrencies in this section. Most cryptocurrencies and cryptoprojects will be forgotten. But rather than just two, there will certainly be tens or hundreds of them.
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