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Is Bitcoin Drifting Towards a Dark Future?

The trends in the market unfortunately haven’t shown any signs of changes and growth as the coin market capitalization continues to avalanche down. The coin market grew to $304 million on 26th of July making it the highest value to be reached within the month. The market seemed to show a bullish behavior, all until the ETF proposal of Winklevoss brothers was rejected by the SEC and the market cap plunged as a whole.

Volatility is the first word that comes to mind when cryptocurrencies are talked about, but the recent week of continuous fall has worried the investors about the future of bitcoin and altcoins. Bitcoin seemed to be the beacon of success for all of the cryptocurrency market at first, but the same currency has been the reason of the prices being dragged down in the market.

Bitcoin depreciated, reaching a 2018 low of $5785.43 in June but the currency bounced back and showed a bullish sign. The signs of the rally motivated the bulls of the market and gave them a hope of a future where the currency would hit extreme prices. Matthew Newton, analyst at eToro said:

If bitcoin can close above $8,000 today, we could assume that we may have a good run toward $10,000.

Showing similar opinions,the publisher of newsletter CryptoPatters said:

While multiple indicators are signaling a pullback is due, breaking $8400 with strong volume could see this rally extend to key technical and psychological resistance at the $9500-$10,000 level before that pullback.

Oppositely, before hitting the $10,000 mark, the currency faced the anticipated pullback and is floating just above $7,000. Even though the currency hit the low of $5,785.43, it bounced back and the anticipations weren’t met and the prices were pulled back. This gave rise to two economic models related to Bitcoin,  the Haye’s model and the Wheatley models.

The two models work based on calculations watching the trends of Bitcoin and analyzing the graphs.

Bulls

The Haye’s model predicts that the price would hit $55,931.60 which is almost too bullish for a prediction, although is backed by many bulls of the market.

Talking to CNBC, renowned financial analyst, Ran Neu-Ner stated that:

I think 2018 is the year where the mechanisms to allow retail consumers to get into cryptocurrencies start to open themselves up. The price will become more stable.

Regarding market stability and volatility linked to cryptocurrency, the co-founder of Reddit, Alexis  Ohanian stated that:

As volatile as it’s been, we see it continuing [to go] up over the long term, because more and more people are going to look for alternatives to fiat as a store of value as we see currency fluctuations with states failing and other uncertainty, that makes having a digital store of value like bitcoin something that’s desirable, because you don’t have to worry about withdrawing it from a bank or the value disappearing as a government money.

Recently, Starbucks decided to go all in on cryptocurrency also seemed to be “the biggest news of the year for bitcoin” — because it paves the way for a bitcoin ETF, according to BK Capital Management founder Brian Kelly.

Bears

Similarly, the other side of the picture is shown by the Wheatley model, that predicts a price of $2352.03. This forecast might be too bearish for some, although the bloodbath is in the views of market bears. Bitcoin has been in the bear cycle since the start of the the year, before which it hit its all time high $20,000 in December, and almost all of the top analysts are predicting decline in the prices of Bitcoin.

Neu-Ner, stated his bearish opinions on CNBC saying that:

Right now my money is on the market continuing to go down.

Comparing the bear market to the bull, he also stated that there’s more than a 60 percent chance of a crypto bear market, compared with a 16 percent chance of a bull market. Although he says that investment in Bitcoin now a days in worthless, but as for long term investments, investors should consider investing in the digital currency as there will be a rally soon.

Continuing with his prediction of Bitcoin in the near future, Neu-Ner said:

I’m calling $5,350 in the next week or two.

Mini-rise in Ethereum’s dominance

Stuck in between the falls in the market cap’s value and the dramatic falls and surges in the values of Bitcoin, the fact that remains neglected is that despite it’s decrease in price, Ethereum is gaining subtle percentages in dominance in the overall coin market.

As shown by coinmarketcap:

src: Coinmarketcap

 

The volumes of the ethereum market are increasing as the ethereum blockchain technology is progressing and the dapps have started to support ethereum as their mode of payments. The subtle 1% increase in the dominance of ethereum shows signs of growth in the future that it would soon push itself and try to catch up with bitcoin in the coming years.

 

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