Bitcoin fell in and out of the news this year for all of the wrong reasons. Indeed, the year of the coin’s tenth anniversary was–by many accounts–a real stinker. It was the year that wasn’t for Bitcoin; the year that wasn’t Bitcoin’s big adoption year, the year that wasn’t Bitcoin’s big moment in the sun.
But if all publicity is good publicity, the negative pieces of coverage that Bitcoin got throughout the year all but dwarfed the dwindling amount of light shone on most altcoins. They slipped and slid just like Bitcoin did–but without the Greek chorus of the media groaning and tutting at every turn.
Discover iFX EXPO, Your Gateway to Asian Markets!
Ethereum’s Precipitous Fall
Remember 2017? 2017 was a huge year for Ethereum. Indeed, the cryptocurrency’s massive rise in Q2 of 2017 was one of the factors that put crypto on the map of the first place–within a matter of months, Ethereum lept from $50 a pop to nearly $400. Some of those who got in several months earlier, when Ethereum sat around $15, managed to clear a massive profit.
Ethereum rose again near the end of 2017 along with hundreds of other cryptocurrencies in the big crypto boom at the end of the year, this time clearing heights of over $1000. Much like Bitcoin, analysts sang Ethereum’s praises and predicted that it was heading to the moon in 2018.
Boy, were they wrong.
It turns out that similar to Bitcoin, much of the driving force behind Ethereum’s $1000+ valuation at the beginning of 2018 was driven by speculation. When the speculators left the market, it’s possible that the only thing remaining was the core group of entities that actually do use the Ethereum network.
Not everyone was convinced that Ethereum’s valuation was going to continue its astronomical rise throughout 2018. In fact, Ethereum creator Vitalik Buterin himself expressed on more than one occasion that he believed that all cryptocurrencies were due for a serious market correction.
Reminder: cryptocurrencies are still a new and hyper-volatile asset class, and could drop to near-zero at any time. Don’t put in more money than you can afford to lose. If you’re trying to figure out where to store your life savings, traditional assets are still your safest bet.
— Vitalik Non-giver of Ether (@VitalikButerin) February 17, 2018
Additionally, April argues that “emerging markets will play an important role in ushering in mainstream adoption of altcoins, with remote/rural populations in countries like Nigeria, Argentina and Venezuela leading the charge.”
It is perhaps within these markets that altcoins will finally have the chance to flourish. “In these markets, the ability for blockchain and crypto to remove gatekeepers by empowering the underserved/unbanked — combined with geopolitical instability and high inflation — has created the perfect storm of opportunity for blockchain-based solutions to overpower traditional banking and fiat.”
Still, things will get worse before they get better. “2019 will be the year when we start to see a few coins delivering network value and gaining network effects. This should be a very small percentage of tokens. 99% of them will and probably should die, but 1% or less may show real signs of life,” said Miko Matsumura, VC and General Partner at Gumi Cryptos and a founder at Evercoin Exchange, to Finance Magnates. “Once this happens we will see a bit more life in the markets.”