Opinions

Cryptocurrency Status Q2 2018 – is it the Darkness Just Before the Dawn?

2018 has seen the cryptocurrency market go on a roller coaster ride, with more lows seen as compared to the highs. Although we saw bitcoin’s value dropping by almost $14,000 in a matter of just six months, a possible surge might just be around the corner, as the ending of the second quarter of 2018 signals an exciting ride ahead.

All in all, the investors who had previously built their empires on the crypto-market were met with a sudden shock in 2018, with prices of cryptocurrencies dropping far below expectations, while those who started to enter the market later on, saw a light of hope as the ending of second quarter signals more and more growth moving forward.

Performance review

In order to cover the major portion of the market as per the market capitalization, the performances of two of the most dominating cryptocurrencies across the crypto-industry are elaborated.

1. Bitcoin plummets shockingly but promises future growth

The start of 2018 marked the highest value that the bitcoin achieved in the year, crossing the $17,000 barrier on January 6, as per CoinDesk’s BPI. Just after that, the market rate for bitcoin collapsed with no majorly signs of a recovery trend in sight. The overall trading of bitcoin across the exchanges also dropped considerably by huge amounts.

In the second quarter, the overall trade volumes, including crypto-to-fiat currency volume, crypto-to-crypto volumes and fiat-to-crypto volumes, dropped significantly by a daunting percentage of 26%, according to a report published by CoinDesk. Bitcoin transactions taking place over the crypto-space also dropped considerably, with miner revenue dropping by 22%, and miner fee plummeting by 19%.

Although hashrate saw a trend antithetical to the performance trend described above, but its growth slowed down considerably in the second quarter of 2018 as compared to the first.

Although the market performance might be down, but bitcoin flourished in the aspect of networking associated with it. Development activity on the bitcoin network saw a little change in progress, but in a positive direction.

The overall performance review of bitcoin in Q2 is depicted in the table below:

src: CoinDesk

2. Ethereum follows Bitcoin’s suit

The market capitalization of bitcoin largely affects the trends displayed by other cryptocurrencies across the crypto-world. Ethereum largely followed bitcoin’s suit with exchange activity plummeting along with the native currency on the ethereum network dropping by a shocking 37%. Ethereum saw a major drop from just under $1400 in January, to below $500 in June, 2018.

In regards to mining, ethereum showed majorly positive signs with mining revenues rising up by 22% in a matter of months. The fees paid to the miners also increased quite considerably, rising over the mark of $1.1 billion, coming quite close to the bitcoin’s mark in Q2.

Major developments and issues were observed on the network end of ethereum. U.S. Securities and Exchange Commission (SEC) stated that ETH, currently, is not a security. William Hinman, the Director of Corporation Finance Division, said:

Based on my understanding of the present state of ether, the ethereum network and its decentralized structure, current offers and sales of ether are not securities transactions.

All in all, ethereum, alongside other major cryptocurrencies in the crypto-world, followed bitcoin’s suit of plummeting in value.

The future

As we see the end of the second quarter, a silver lining is seen across dark clouds that covered the second quarter largely. The investments made in the crytocurrency market increased more than ever signaling a stable end of the year for the crypto-market. The fundraising for projects employing blockchain technology increased beyond expectations. The amount of blockchain startups also increased in number, largely contributing to the growth of this industry. Initial Coin Offering sizes have also increased quite steadily in the second quarter heralding the dawn of stability in the blockchain market like never seen before.

By the end of year 2018, the cryptocurrency market is expected to spike up like never before. With all the major investments pouring in from different investors across the digital market, the market is heading towards more and more stability. The key cryptocurrency to look at in the future is bitcoin, since it has the most market capitalization as compared to the others, and largely dictates the trend in the blockchain world.

The major predictions about the future of bitcoin, and other cryptocurrencies, are nicely summed up in this special report.

All in all, if the demands for buidling exchanged traded funds for bitcoin and other cryptocurrencies are fulfilled by the U.S. Securities and Exchange Commission (SEC), we might see a surge that will overshadow the cryptocurrency run of 2017. After the establishment of ETFs, more and more institutions will start investing and will enter the game of cryptocurrency wasting no time, as the market will be stable and uncertainty will be minimum.

Currently, from the viewpoint of all the financial analysts across the crypto-space, if the establishment of a crypto-based ETF takes place, we will see the prices of cryptocurrencies, specially bitcoin, go past all the previous barriers, and reach a new high by the end of 2018.

Ahsan Khalid

Blockchain Developer. An Electrical Engineer with majors in software development. I present forward my insight regarding the latest happenings of the blockchain world. All views on my articles are my own. Email: ahsan@blockpublisher.com or editor.news@blockpublisher.com

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