In May 2018, I posted an article critical of Cryptocurrency forecasters, pointing out that most people voicing an optimistic view of future price moves had a conflict of interest. After nearly a year of hitting new lows each week, Bitcoin, and Cryptocurrencies at large, have rallied for a week running. As has been a trend in this industry, the optimists are out in force again.
However, Bitcoin forecasts are still Bollocks. As far as technology and use cases are concerned, the Blockchain sector has gone way beyond Bitcoin, but for some reason, this failed “digital currency” is still, rather absurdly, seen as the bellwether of the sector. The Bitcoin Foundation is yet to do anything substantial to take the token close to being what Satoshi Nakamoto envisioned it to be. Transaction times are still high and network fees are volatile. In fact, other tokens such as Ether, EOS, and Steem now have better fundamentals. Data from www.stateofthedapps.com suggests that EOS has surpassed Ether as a decentralized platform, with EOS dapps having more users than those deployed on Ethereum. Even steem, a cryptocurrency that incentivizes social media addiction seems to be more actively used than Ethereum. Obviously, the popularity of Bitcoin and Ether still stem from all the publicity they gained during the dazzling price rise in late 2017.
Not that there haven’t been any moves on fundamentals. Upbit, a South Korean cryptocurrency exchange has obtained approvals to offer trading services in South Korea and Singapore, and will soon have the infrastructure for traders to capitalize their trading accounts from real-world banks. Similar approvals in Europe are likely in early 2019. In the United states, the Securities and Exchange Commission is warming to the idea of cryptocurrencies, with Commissioner Hester Pierce being quite vocal of her views supporting the asset class. Though these will provide the necessary tailwinds for Cryptocurrencies as speculative assets, they completely exclude the use cases that crypto-entrepreneurs are working on. The marketplace for speculation is expanding rapidly, with a new decentralised exchange opening every week, but liquidity is thin as in most jurisdictions, you can’t fund your trading account from a bank.
So the next time someone buttonholes you to rave about how the crypto market has “bottomed” and is now heading “to the moon”, smile thoughtfully and nod, perhaps make acknowledging grunts to be polite knowing full well that it’s all a load of bollocks.