In the fourth quarter of 2017, many investors wanted to buy BTC and ETH specifically to invest in initial coin offering tokens. They didn’t intend to hold BTC and ETH but had to buy them to get what they wanted. Those who owned BTC and ETH, on the other hand, had no interest in selling. They were waiting for the price to rise so they would sell and make profit. There were also those who owned these cryptocurrencies because they believed in them.
Why Did The Price Of Cryptocurrencies Fall?
After the cryptocurrency startups completed their ICOs and became whales, they decided to unload their tokens in December and January 2018. This led to an increase in the demand for BTC and ETH which was followed by an increase in price. Unfortunately, the hangover faded and startups started exchanging their cryptocurrencies for fiat so they can pay engineers and develop their companies. This fueled the run-on-the-bank panic that brought the cryptocurrency market to where it is today. Again, regulatory agencies started putting pressure on initial coin offerings because of the increased cases of scam. This slowed ICOs down reducing the demand for ETH and BTC as new token issuers started accepting fiat deposits directly instead of ETH.
Since ICOs were accepting fiat directly, the market was full of sellers and holders of ETH and BTC but limited buyers. The prices started to fall significantly. Since the price of BTC is related to the price of other cryptocurrencies in the market, the entire market took a hit when the demand for BTC and ETH dropped. This year, it became clear that some of these ICOs were not worth the investment.
What Does This Mean For The Cryptocurrency Industry? When things settle down, many of the weak ICOs will be flushed out of the market. Only strong companies will remain. Retail and consumer investors of Southeast Asia and the world over no longer have any interest in gambling with ICOs especially when you consider the current volumes of cryptocurrencies.
Before now, the cryptocurrency industry used to be made up of 20% institutional investors and 80% retail investors. Now, the order has changed. There are now more institutional investors than retail investors. If more experienced institutional investors decide to invest in startups, retailers may be more inclined to invest. These experienced VCs will raise enough funds and increase the daily volumes of deals. They will have fully decentralized and centralized teams that would do due diligence and help them determine which portfolios to fund.
Bitcoin (BTC) Price Today – BTC / USD
In 2019, 2020, & 2021, the companies that will be funded will be better than those funded in 2017. This will lead to a market rebound. Even if the market doesn’t look good right now, BTC is resilient as it has survived many events people believed would ruin it. Its long-term curve is up so when many infamous coins fade, the market will enjoy a lasting rebound.
Cryptocurrency Price Analysis Today
During the weekend, the price of BTC went higher against the USD carrying the rest of the cryptocurrency market along. Yesterday, however, BTC fell below the $4000 mark again. Right now, it is still red against the USD at $3,806.37. It is down by 0.46%. The trading volume over a 24 hour period is $5,653,010,890 and the market capitalization is $66,399,605,084.