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Why Bitcoin, Ethereum And Altcoins Are So Weak in 2018

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While Bitcoin has achieved much in less than a decade they have been around, it would seem that this year has been particularly harsh. Even though it is still a large trend, something has caused the crypto world to seemingly lose its momentum. So, today, we will explore what has been bugging cryptos in 2018.

So far, 2018 has been quite an eventful year for cryptos. The market went from its peak to its presumed bottom in a matter of days back in January. Numerous times since then, the stubbornly bearish market hinted at going bullish, only to crash once more, and take everyone’s’ hopes with it.

Hack after hack after hack hit the exchanges, wallets, ICOs, and everything else crypto-related. And, let’s not forget the controversies, accusations, lawsuits, the issue of centralization and decentralization, and the number of altcoins going up to over 1800. According to many experts, it is a miracle that the crypto market is still around at this point. And, while the year has obviously been extremely tough, we should now take a look at some aspects that have made an impact on the situation, for better or for worse.

The capital pool

In order to see the situation regarding the crypto market’s capital pool, let’s start with retail. Retail has developed a large interest in cryptos on several occasions in 2017 and 2018 due to the belief that there is an easy profit to be made. Each time it has happened, the cash flow seemed to help the market a bit, but it never received enough to take off.

Then, there is a controversy about early adoption. Despite the big popularity of ICOs, especially at the beginning of the year, a lot of coins were ruined before they even started due to fear of scams and Ponzi schemes. Nobody was willing to jump the gun, which in the end led to more damage done to the market.

Of course, institutional investors did not help at all. Those against the trend continued to bash it at any given opportunity, and they also have some pretty influential names among them. Pro-crypto institutional investors, on the other hand, while supportive, had to remain careful and hesitant. And, while their contribution is one of the largest sources of cash flow to the crypto space, the amount invested has not been nearly as big as it could have been according to estimations.

The leaks

While the capital pool already suffers due to a lack of trust, security, and a threat of scams and schemes, there are other issues that are constantly draining it.

One of the largest issues is mining inflation. According to statistics, over $30 million worth of cryptos are entering the market every day. That is almost $11 billion on annual basis. While the mining is a necessary part of decentralization, the new coins are definitely helping the bear market, instead of turning it bullish.

The next big issue is taxes. The governments are quickly finding a way to subject cryptos to taxation, which is draining the space even more. Additionally, there are things like leverage and various fees within the exchanges themselves. The exchanges cannot be eliminated since they are needed for coin trading, and until the truly decentralized exchanges emerge, the crypto holders are stuck with these ones.

Finally, there is the so-called demise of altcoins. A lot of these coins suffered greatly from price declines, and have damaged the market even more than it would be damaged without them. Their popularity came from investors who wanted to take advantage of their low price, and when it went up, more people came. Then, the prices went down and pulled all of these investments with them.

For now, it is unknown what the future of cryptos will hold. While many are hoping for a bullish market, there are also those who foresee the disappearance of cryptos. While this will hardly happen, we still have to wait for the proper conditions that would turn the market into a profitable space once more.

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Disclaimer: This article should not be taken as, and is not intended to provide, investment advice. Global Coin Report and/or its affiliates, employees, writers, and subcontractors are cryptocurrency investors and from time to time may or may not have holdings in some of the coins or tokens they cover. Please conduct your own thorough research before investing in any cryptocurrency and read our full disclaimer.

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Bitcoin

Stepping off the rollercoaster: Why I’ve fallen out of love with Bitcoin

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The very word Bitcoin has almost become synonymous with that of cryptocurrency. It’s basically just a medium of conducting digital transactions – it’s a virtual currency and one of many. So how has it taken on a definition of its own and asserted itself as a leader in the digital financial ecosystem?

Bitcoin has been crowned king of altcoins, probably because it was one of the earliest and most successful of its kind. The trendsetter has ushered in a wave of cryptocurrencies built on decentralised P2P networks and has inspired a growing number of followers and spinoffs. But is Bitcoin struggling to keep up with the newcomers who have made considerable developments to the stability, security, and usability of the crypto world?

The supporting case for Bitcoin has been a clear one. Its pioneering infrastructure has situated it in a position of dominance in the altcoin realm. Bitcoin has a proven usage case as a store of value. Having existed over 8 years without failure, it has a large lead over most altcoins and has withstood the test of time as younger counterparts join the market. However, it seems to be on a downward slope, or at the very least, not progressing at the speed of the market.

In May this…

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Altcoins

Cryptocurrency Collateralized Debt Positions Are Growing in Popularity

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While Bitcoin (BTC) continues to hover around the magical 10,000 price level, altcoins continue to fight an uphill battle.  Simply put, hopes of a future bull run continue to diminish as Bitcoin maintains its dominance.  One school of thought is that a few altcoins will survive and flourish, but which ones are anyone’s guess.  That being said, it’s hard to go wrong picking against the top coins like Ethereum (ETH), Ripple (XRP), Litecoin (LTC), and EOS.  These projects have managed to find a foothold in the market and have a better chance than most of staying there.  While traders wait for their positions to increase in value, one opportunity that may be worth looking at is initiating a collateralized debt position.

What is a Cryptocurrency CDP?

In traditional terms, a CDP is essentially putting up collateral in order to receive a loan against the deposited amount.  There are several examples of this in our day to day lives.  Auto title loans from large companies like TitleMax are extremely popular with consumers.  Consumers are essentially able to use their car as collateral in exchange for a cash payment which can then be used for whatever needs the consumer has.  The consumer can continue using their car as long as debt payments are made.

The same concept applies to cryptocurrency CDPs.  Consumers are able to put up crypto tokens, such as…

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Altcoins

Hodium Presents a Compelling Opportunity for Outsized Investment Returns

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I’m sure all of us remember the cryptocurrency glory days of 2017 and early 2018.  It was one of the biggest bull runs in history and created incredibly wealth for quite a few early entrants.  Unfortunately, for most of us, those gains have most likely been wiped out during the altcoin apocalypse.  The truth is that traders probably thought a bit too highly of their trading abilities when the reality was that anyone could have thrown a dart at a board and ended up making money.

As markets mature (and the crypto market is definitely maturing) it becomes more and more difficult to generate alpha.  In that regard, it’s similar to traditional financial markets.  I can remember trading during my high school days.  It was the late 90s and right in the middle of the dot.com boom.  Eventually, however, the euphoria fades away and reality hits hard.  Now, it’s become rather difficult to actually trade profitably which has given way to the rise of hedge funds.

Hedge funds are investment funds that pool capital from accredited and/or institutional investors and invest in a variety of assets, often with extremely complex portfolio-construction and risk management techniques.  The professionals employed by hedge funds are the best of the best and have spent years honing their craft.  That is why they’re able to make the millions of dollars that they normally…

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