cryptocurrency
Holiday Bubble Helped Cause (Routine) Crypto Stumble
January 18, 2018
Those cherished-yet awkward-family moments you navigated this holiday may be responsible for Bitcoin’s recent rollercoaster ride.
While that may be painting with a bit of a broad brush, it does appear that that the post New Year’s dip that befell the cryptocurrency world was tied to a festive hype-bubble.
Between Thanksgiving and the December holidays cryptocurrency was a hot topic around the dinner table while people spent extended time with their families, John Omar, head of the Chain Operator blog and cryptocurrency trading course, told deBanked.
Omar explained that not only were those that were already schooled in the ways of crypto-trading discussing their financial gains over apple cider and stuffing, but family and friends who were previously unaware or unfamiliar with the likes of Bitcoin were having their interests piqued.
This spurred a rapid uptick in pricing on the way to to unprecedented gains in Bitcoin and other crypto counterparts.
“No, this is not the end of crypto,” Omar told deBanked. “This is far from the end. What we’re seeing is a price correction after 2 months of unprecedented growth. It’s not even a historic price correction. There have been more dramatic movements. There are a few reasons why the price is correcting at this time: potential regulation from Korea, China and France, and people who bought into cryptocurrencies after the holidays selling off to realize profits.”
Emerson Taymor, founding partner of the strategies firm Philosophie, agrees with Omar’s stance.
“Bitcoin and the market has seen much more significant drops in its past and always rebounded with a vengeance. It is a healthy correction, but far from the end,” he said.
Like Omar, Taymor also attributes the recent drop to “regulatory headwind” overseas.
While he believes that cryptocurrencies best days are not necessarily behind them, there will be losers on the path to determining a clear winner.
“Remember, cryptocurrency is much more than the “stock price,” Taymor said. “We are seeing a fundamental shift in how technology is going to be created. I believe we will have another big run up for the next 6-12 months and then we will have the real bubble bursting. Much like the Dot Com bubble, we will see people lose a lot of money and companies implode like Pets.com and Webvan, but we’ll also discover the next Amazon!”
Was This Bitcoin Lender Paying Returns Too Good to Be True?
January 17, 2018
As the rivers flowed red with the blood of crashing cryptocurrencies Tuesday, one company did not survive. BitConnect, a company infamous in the crypto community for paying out obscenely high returns for lending your bitcoins, may have been too good to be true.
BitConnect offered investors the opportunity to make loans on their platform and earn up to 40% interest per month PLUS an additional .25% daily. The seemingly irresistible returns were enough to allow the market cap of their own company cryptocoin (BCC) to soar to more than $2.6 billion by early January.
On Tuesday, they announced that their lending service and other segments of their business would be discontinued. Cease and desist orders issued by two states, North Carolina and Texas, are said to have played a role. Texas authorities relied more on the company’s obvious flagrant violations of securities laws while North Carolina alleged that the company’s advertised returns were a red flag for a ponzi scheme.
The BitConnect Coin lost nearly 90% of its value immediately after announcing their closure. Meanwhile, the cryptocurrency markets shed more than $200 billion in market cap the same day, according to Coinmarketcap.com. The value of Ripple (XRP), a coin speculators believe will play a role in the future of banking, was not spared. Its price has dropped by 68% since January 5th.
